Tax Credits (Income Thresholds and Determination of Rates) (Amendment) Regulations 2015

Debate between Baroness Hollis of Heigham and Baroness Meacher

Monday 26th October 2015 Lords Chamber

[Baroness Meacher]

I thank my noble friend Lord Listowel. I should mention that a petition signed by 270,000 members of the public over the weekend was handed to me this morning. There is huge fear and anger about these cuts. I am very grateful for the support of the public and the media—believe it or not—and their appreciation of the efforts in this House, although I personally never sought any of it. That is a rather important point to make: I am really not here to grandstand.

I support the Government’s raising of the tax threshold, the increase in the minimum wage and free childcare for three and four year-olds, but those measures will not protect the most vulnerable. The Institute for Fiscal Studies makes clear in its analysis that the biggest losers from the 2015-16 tax and benefit changes, even by 2020, will be the poorest working families. The very poor will hardly gain at all from the increase in the minimum wage or the national living wage. Very poor self-employed people will not gain at all from the increase in the minimum wage. I have had a pile of emails from self-employed very poor people. The biggest gainers from the increase in the income tax threshold and the higher rate threshold will be those earning £43,000 to £121,000 per year. We seem to have a massive redistribution of income here, but it seems to be going the wrong way.

The Government have for five years urged unemployed people to take a job. The sanctions regime has been extremely brutal, but having said that, it is, of course, much better for people to work, if they can, than to remain unemployed. The main justification for the Government’s policy has been that work pays. Yes, and working tax credits achieved that objective. Working tax credits prevented unemployment soaring in the recent recession.

Finally, I repeat that the aim of this amendment is to support the democratic process to enable the elected House to hold the Government to account. That is the duty of this House. If we cannot do that, we might as well not exist.

[Baroness Hollis of Heigham (Lab)]

My Lords, on the amendment standing in my name, two issues concern this House. The first is whether this amendment improperly challenges Commons financial privilege—a constitutional issue. The second is whether this amendment improperly challenges Government cuts to welfare—the policy issue.

Let me address the first, on constitutional propriety. As the noble Baroness, Lady Stowell, said, when we have framework Bills on childcare and social security, all the serious detailed work is done, rightly, by regulations—that is, SIs. We can amend Bills; we cannot amend SIs, yet often we do not know the Government’s intent until we see the SI itself. We then face either a draconian fatal Motion or a lamenting regret Motion that changes nothing, so instead this is a delaying amendment. It is not fatal, as the Government know. It was drafted with the help of the clerks and it calls for a scheme of transitional protection before the House further considers the SI. Essentially, the cuts would apply to new claimants only. Frankly, that new SI could be drafted in a week and implemented next April exactly as planned.

However, does it none the less break convention by trespassing on Commons financial privilege? No. The advice from the Clerk of the Parliaments—and he has seen and confirmed my words on the specific issue—is that Commons financial privilege is exercised in two ways. We can amend an education Bill, say, but the Commons can reject our amendment if the Speaker certifies that the Commons has financial privilege on this issue. Secondly, says the Clerk, the Commons can pass a supply or money Bill, which we cannot amend. He goes on: financial privilege does not extend to statutory instruments—it simply does not. Nor are statutory instruments covered by the Salisbury/Addison convention. The more so, I would add, because the Prime Minister ruled them out himself, and he did because these layered elements to tax credits are all affected by the taper and the cuts.

As has been said, if the Government wanted financial privilege, these cuts should be in a money Bill; they are not. If they wanted the right to overturn them on the grounds of financial privilege, they could be introduced in the welfare reform Bill on its way here; they did not. So why now should we be expected to treat this SI as financially privileged when the Government, who could have made it so, chose not to do so? It is not a constitutional crisis. That is a fig-leaf possibly disguising tensions in the Commons between members of the Government. We can be supportive of the Government and give them what they did not ask for—financial privilege—or we can be supportive instead of those 3 million families facing letters at Christmas telling them that on average they will lose up to around £1,300 a year, a letter that will take away 10% of their income on average. That is our choice. Those families believed us when we all said that work was the best route out of poverty and that work would always pay. They believed the Prime Minister when he promised that tax credits—and they are one package—would not be touched.

But why do people need tax credits? There is a lot of misunderstanding about this. If the House will allow me, consider two women in a call centre: one is single, working 35 hours a week, who from April earns £13,000 a year for herself, and the other, a deserted mother with two young children, managing 25 hours a week, earns £9,000 a year for the three of them. The Government are completely right that we should certainly not subsidise employers’ low pay, but no employer could pay the deserted mother twice as much per hour as the single woman on the next phone in the call centre to make up for her family’s circumstances. The employer cannot do that and it is not reasonable to ask it to do so. That is the job of tax credits. They reflect family circumstances, which an employer cannot reasonably do.

Welfare Reform Bill

Debate between Baroness Hollis of Heigham and Baroness Meacher

Wednesday 14th December 2011 Lords Chamber

[Baroness Hollis of Heigham]

My Lords, I strongly support my noble friend on his last point. The whole point of sanctions is not just to punish but to change behaviour. If someone does so and therefore, having learnt their lesson, is willing to comply, they should get rewarded for that, so to speak, otherwise there is no incentive for them to change their behaviour. I hope that the Minister will hear my noble friend’s wise words, otherwise the sanctions regime will not work or stick—and, I suspect, will end up being judicially reviewable.

[Baroness Meacher]

My Lords, I shall speak extremely briefly to Amendment 28, which is in this group, but I would not wish the House to take the brevity of my remarks as an assessment of the importance that I attach to it. The amendment concerns thousands of people up and down the country with mental health problems, mental impairments and learning difficulties and would affect whether they are fairly treated or denied benefits unfairly because of misunderstandings and a failure to understand why those people have failed to comply with the conditionality requirements and then have their benefits removed or cut.

I emphasise that it is not sufficient, as I believe the Minister said in Committee, that if a matter is drawn to the attention of the officials, they will take that matter into account. Many of these people will not be aware that they need to make that clear; they will not even necessarily have the capacity to make it clear that their disability, handicap or learning difficulty prevented them satisfying the conditionality requirements. They may indeed be lying in bed, not opening their post, not answering the phone, not responding to requests to come for an interview and so on.

The Minister is very familiar with these issues, but I was concerned in Committee that he seemed simply to suggest that a person can point out that they have a problem. I would be interested to know whether he can assure the House that specific actions will be taken by officials to ensure that they have considered and checked whether a person has a mental health problem or a learning difficulty, and whether that has in fact affected their capacity to respond.

The other issue in the amendment has to do with reasonable adjustments. Of course there are people who cannot get to the office and attend an interview or assessment, such as people suffering with agoraphobia. Many others are also sufficiently unwell in a mental health way that they simply will not be able to perform as others might. Reasonable adjustments have to be made for those claimants if they are going to be fairly assessed and not sanctioned unreasonably. I will be very interested to know what the Minister has to say in response to these issues.

Welfare Reform Bill

Debate between Baroness Hollis of Heigham and Baroness Meacher

Wednesday 14th December 2011 Lords Chamber

[Baroness Hollis of Heigham]

I have a series of amendments on housing. This amendment calls for periodic reviews of the interconnection between CPI and rent levels. This is an issue that has concerned the whole House at different stages, including on the CSR Statement as well as in Committee.

We know now that the proposed deficit reduction programme, according to the Chief Secretary, will extend for a further two years at least beyond the general election. This amendment now takes on the added urgency that perhaps did not exist at the time when we discussed it in Committee. Local housing allowance, which I will call housing benefit, in the private rented sector is based on the 50th percentile of private rents, which should mean that half of all private rents are affordable on HB and half are not. It is a median. The HB, in other words, covers the average rent. We also know that the Government are reducing that 50th percentile to the 30th percentile, which means that 70 per cent of properties would be unaffordable but 30 per cent should still be so. We have argued that and resisted it, but the Government have insisted on their proposals. That is bad enough and will make it much harder to find a private rented home. But, in addition, HB to cover your rents up to the 30th percentile will rise only by CPI, not by the actual increase in private sector rents. Yet according to Savills rents are rising at the moment by more than 7 per cent a year, and CPI is only half of that—not this year but we expect it to be. Rents are rising on average at double the rate of CPI, mainly because of additional demand for private flats from young people for whom originally the flat would have been a transit tenure but who now stay there while they seek to save their deposit for a home of their own.

The Minister used to argue that capping HB would drive down rents. That is not happening, nor will it, because no longer do landlords have to let to HB tenants. Just as there are eight people after every job, there are eight tenants after most lets. HB tenants will get only what no one else will take: the substandard, the squalid and the downright unsafe. Any complaints and you are evicted after six months. Tenants will be forced into poorer and poorer accommodation. Worse, as I say, rents are rising at double the rate of CPI, so whereas now your HB may theoretically cover 30 per cent of available rents, in three years’ time it may cover only 20 per cent, and in five years only 15 per cent. In more expensive towns such as Winchester, it is estimated that there will be nothing available to rent for anyone on HB within the next few years.

This amendment is very simple. It requires that the Government's original policy intent—that HB in the private sector will allow the tenant the choice of the bottom 30 per cent of properties—continues to be respected and that the widening gap between the CPI uplift in HB and the actual rise in private rents does not invalidate the Government's intentions. In other words, this amendment simply asks the Government to ensure that they do what they say they want to do—no more, no less—and that we keep clear the policy intent, and that it is delivered.

In the past, the Minister has decorously brushed this aside by saying that it is outside the CSR period, but given the Chief Secretary's remarks, it is not any more. He also helpfully said in Committee on 20 October that,

“if local housing allowance rates are clearly out of step with rents, they can be reconsidered”.—[Official Report, 20/10/11; col. GC 146.].

It would be very helpful to know how this would be done, given the vagueness of the draft regulations. The Government should confirm whether reviewing the operating method will occur periodically or, if not, what will trigger it. This amendment seeks to get greater clarity in the regulations in order to protect the Government’s own policy intent: that 30 per cent or so of private lettings should be affordable and available to those on local housing allowance. I beg to move.

[Baroness Meacher]

My Lords, I support Amendment 17, to which I added my name. As always, the noble Baroness, Lady Hollis, has comprehensively covered the issues and I will therefore take only a few moments of your Lordships’ time to express my personal concerns about the issue.

The Government have a policy to reduce over time the percentage of GDP paid out in benefits to those on low incomes and those out of work. Perhaps the main mechanisms by which this will be achieved, though by no means the only ones, are the range of housing allowance controls to which the noble Baroness referred and the linking of housing allowance to the CPI, rather than to the rate of increase of rents themselves. The problem I have with the CPI link in particular, along with all the other controls, is that it is beyond the control of government how this plays out; hence the importance of these monitoring mechanisms that the noble Baroness has spelt out.

For example, if the euro collapses—it seems ever more likely that it may—and we have several years of recession or, indeed, deep depression with falling prices, do the Government have any idea how rents will respond in that situation? Because of the pressures of a growing population with more and more single-person households, as well as the limited stock of properties, particularly in London and the south-east, it is possible that rents may remain static, or even rise in the south-east, while other prices are falling. The Government assume that the downward pressure on housing allowances will ensure that in fact rents fall as well, but I am not at all confident about that. There is a huge private rented sector out there and as fewer young people can afford to buy, more and more of them will indeed move into that rented sector.

A very different scenario will be that once the years of fiscal tightening are over inflation could return with a vengeance, leaving a soaring gap between the RPI and the CPI—the prices claimants will have to pay in the shops on the one hand, and the CPI which will determine their housing allowance levels on the other. Of course, all these uncertainties will be there alongside a benefits cap, which may or may not be inflation-proof, and the need for many vulnerable people to adjust to a move from higher ESA to lower-level JSA. The Minister knows that I fear many vulnerable people will be included within that group, going down the slope towards the cheaper JSA. There is also the loss of disability benefits for children, the loss of tax credits and so forth, and the move to monthly payments if we cannot persuade the Minister that this will be the last thing that people are going to cope with. For all these reasons, I agree with the noble Baroness, Lady Hollis, that the House needs some assurance that there will be systematic and regular monitoring of the consequences of linking rents to CPI and on how the situation will be assessed and in what circumstances a change of policy would be regarded as appropriate.

I would also be grateful if the Minister could inform the House on a particular aspect of this issue. Shelter and the Chartered Institute of Housing estimate that the link between local housing allowances and the CPI will, by 2030, result in 60 per cent of local authority areas being unaffordable for LHA claimants. Undoubtedly, these will be the areas with jobs. Can the Minister say whether the Government accept this estimate and, if not, what the Government’s estimate is? Whether or not he accepts the estimate, has the DWP undertaken an impact assessment of the housing allowances/CPI link on employment in this country? What particular impact on employment will this have?

If households have no option but to move to areas with very few employment opportunities, how much higher will unemployment be year on year than would otherwise be the case and what will be the costs of that higher unemployment for the taxpayer? These sorts of issues need to be incorporated within the ongoing monitoring and assessments of the impact of these policies, year by year. Within the Minister's response to this amendment, I would be most grateful if he could include some reference to the employment impact.

Welfare Reform Bill

Debate between Baroness Hollis of Heigham and Baroness Meacher

Wednesday 23rd November 2011 Grand Committee

[Baroness Hollis of Heigham]

My Lords, we are talking still about benefit caps. We left the debate on Monday, I think, accepting that families hit the cap, as the noble Lord, Lord Best, explained so straightforwardly for us, through the interplay of both high rents and large families, a problem particularly in London and the south-east, with 70 per cent of those affected in social housing. Amendments tabled during our previous day’s debate sought, first, a more appropriate comparator by excluding child benefit in particular from benefit cap calculations—this was an argument by my noble friend Lady Lister—so that we could compare like with like and not apples with oranges. A second group of amendments suggested, wisely, a transitional period of grace before the cap was imposed. This is a theme to which I think we will all want to return, because we need a period of grace for quite a lot of the measures being introduced in order for them to settle down before the whole weight of penalties comes into play. We ran a similar amendment on housing benefit earlier. A third group of amendments sought to exclude subgroups from the caps—for example, those in supported housing, carers and kinship carers.

I want to focus on two aspects of all the debates that we have had so far, plus on the issue of carers, which was raised so effectively by the noble Baroness, Lady Hollins, and issues of housing benefit raised by the noble Lord, Lord Best. I support the thrust of all the amendments. There was one golden rule of public finance that I learnt from my time in the department: amendments abating or removing cuts always cost more than the cuts originally saved, even if the situation is not restored to the pre-existing status quo. That may be the case here again.

I wish to raise some wider questions on Amendment 99A tabled by the noble Baroness, Lady Hollins. She argued powerfully that just as PIP will remain outside of UC and the cap, so, equally, should carer’s benefit not be included in the cap, because they mirror each other, as they do in real life. The financial pressures, the fatigue and exhaustion, the using-up of savings and the social isolation apply just as much to many carers as they do to so many disabled people. We know that the Minister is sympathetic to carers, as is the whole House. So far, however, we do not yet know how many carers face a reduced earnings disregard. We do not know how many carers will lose carers allowance, because of the possible uneven mapping of the existing DLA passported benefit to the new PIP. We also do not know whether CA will come within the cap.

Given that the Bill is going through Committee stage here I feel that we are entitled to require the Minister to give us this information before we start Report stage and that we should not have to wait until we get to the clauses specifically about carers. If a single carer—it could be no carers, or it could be 100,000 carers—loses their entitlement to a passported benefit they will come into the framework of in-work conditionality which we have to deal with before we get to the carers clauses, at which point the Minister tells us he will be able to give us the information we want. We cannot do it that way round. It is not fair to the carers and it is not fair to Committee Members, who have been trying to do our best to get from the Minister—I am sure that he wants to be helpful on this—this information on the situation in which carers will find themselves. We must know everything about this situation before Report; otherwise some of us will be demanding that we go back into Committee, in the middle of Report stage, in order to take on board information that should have been available to inform earlier debates. It is not a proposal I would wish to argue. It is annoying for everybody concerned, but I feel quite strongly that it is not reasonable to ask us to proceed in this way.

The second area is housing benefit. Again, I strongly support the amendments moved so powerfully by the noble Lord, Lord Best. However, perhaps I may widen the point to remind the Minister of where we are so far and what we so far know, and then to ask him what advice he would give to a housing association such as mine—I declare an interest as chair of Broadland Housing Association. First, there is under-occupying. So far we have learnt that many of our poorest tenants would be required to move to smaller accommodation—except that we do not have it; it does not exist and it will not be built in the next few years. So the tenants will stay put and be fined on average about £20 a week. They have no savings, so they will run up arrears. However, we will be asked to avoid evicting them on grounds of decency as well as cost savings. Although such tenants would not be intentionally homeless through arrears generated by benefit cuts—as the Minister has helpfully agreed on the record—we would in any event have to rehouse them, probably in the house next door, if we evicted them. We will get substantial arrears from—although not pensioners—perhaps one-fifth of our tenants. I do not know.

We will perhaps also be faced, as we found from the discussion last week, with some tenants who are up against the housing benefit or UC cap. They too will face arrears, and again we will be expected as social landlords to avoid evicting them for what is not their fault. Again, arrears for us will mount.

We may also face cuts in housing benefit for those with supported housing in its various forms, although obviously this is a much smaller group. Again their arrears may mount, and again those will pass to the housing association.

Finally—an issue which we have not yet debated—we will certainly face substantial arrears in the move to direct payments to tenants rather than to the landlord.

Each of these four changes in housing benefit from DWP will plunge social housing landlords into mounting arrears. What is my housing association to do? We cannot raise rents to compensate for those arrears because we are at our fixed-target rent and DCLG does not allow us to go above it. We cannot get extra revenues from HCA or DCLG—indeed, they have cut our capital revenues by some 60 per cent. Housing associations could well find their accounts qualified, at which point the banks may threaten to reprice their capital loans because of infringement of a covenant, at which point our building programme falls.

I suppose that we could cut staff but the Tenant Services Authority within the HCA requires us to improve services. A 95 per cent satisfaction rate on any of the criteria it produces is required, which means that there must be staff on the ground, and quite rightly so. The driving-up of standards equals staff, which means that you cannot cut in that field either.

Put those four cuts together and they could send many housing associations into the red. Any one or two of these proposed benefit changes would be difficult to manage, but to face all four would be unbelievably difficult. I warn the Minister that he could be jeopardising the financial stability of a swathe of housing associations across the country. How then will the Prime Minister’s newly voiced concern for affordable housing be met? Given that 95 per cent of all housing stock that will exist in 10 years’ time has already been built, we cannot adjust the stock to meet what I believe is very wrong-headed, and in some places downright indecent, changes to HB. Some of us feel very strongly about this and it would seriously jeopardise our support for UC. DWP’s cuts in housing benefit will be offloaded to housing associations as arrears.

Goodness knows that local authorities are strapped for cash with 30 per cent cuts, but at least they have other financial resources. Housing associations do not. I repeat to the Minister that his savings will be our debt. DWP and DCLG have to get their act together. As I suggested at Second Reading, not entirely jocularly, if we could persuade DCLG to give up its batty scheme of localising council tax benefit with all the savings that accompany it and trade it for protecting the housing benefit, which would finance the homes we need and keep people in the homes that they want, UC would be welcomed widely across the country. I warn the Minister to take this issue very seriously. It will be very difficult for those in the field of social housing to cope when his cuts become our arrears with no capacity to meet them.

[Baroness Meacher]

I support Amendment 99A, which would exempt from the benefit cap, as others have mentioned, claimants with entitlement to carer’s allowance or additional allowances within universal credit for claimants with regular and substantial caring responsibilities. I am sure that this amendment was moved extremely ably by my noble friend Lady Hollins.

Perhaps I may make a couple of comments about the cap more generally. As Cross-Benchers, we do not normally refer to any political activities that we might have undertaken even in the distant past. Over a quarter of a century, however, I have spent rather a lot of time knocking on doors. One incredibly powerful recollection that I have is that the perception of the so-called scrounger was always the biggest single issue on the doorstep, even bigger than immigration. We cannot get away from the fact that low-income earners bitterly resent neighbours who they regard as being on benefits and, apparently, seeming to do rather better than they themselves. It is important that low-income earners feel that they are benefiting from going to work, which was the objective of the tax credit system. I strongly support the principle of that, albeit that there were a few problems with complexity.

As for the political motivation behind the benefits cap, I understand that people must have that incentive to work and that those in work should not resent those who are out of work. I have concerns, however, which I believe others have expressed, about the cap as a mechanism for achieving that sense of fairness. My understanding is that the design of the universal benefit should achieve this objective if only, as others have said, the council tax benefit were incorporated within it—at least except for a small number of very large families and some people living in very high cost areas.

I suggest to the Minister that the Government give some thought to finding a formulation in the legislation to achieve their fairness objective as between claimants and low-paid earners without resort to the notion of the cap. I know that the Secretary of State is extremely committed to this cap because it is a beautifully simple little message about being tough on claimants, if one is really honest about it. However, the Secretary of State should think carefully about whether this is acceptable within the traditions of democracy in this country. The aim, of course, would be to avoid relinquishing parliamentary scrutiny of the Executive. That is important because the levels and structure of benefits should not be open to change by the Executive without reference to Parliament. I understand that that is possible with the Bill as drafted. I know that the Minister will correct me if I am wrong but that is my understanding.

As regards this amendment, if the Government are determined to have the benefit—and I still hope that they are not—one group of claimants who clearly should be exempt are carers. About 200,000 children in the UK are being raised by grandparents, older siblings or other family members and friends. These carers step in to bring up a child or children as a result of very difficult family circumstances which often involve drug or alcohol misuse, abuse or neglect, death or serious illness, domestic violence or imprisonment. These carers are saving the taxpayer very large sums. These households are often large, simply because they have children of their own and then bring in others, perhaps five or more; so they will be disproportionately affected by the cap. I am sure that others have already mentioned this issue but I hope that the Minister will address it directly.

The idea of imposing a cap or some form of benefit control on large families is presumably to discourage parents from having more children than they can readily cope with, but that argument does not apply at all to carers who take on other people’s children. I do not know what the Minister feels about that point. Is that actually the main incentive behind the cap in relation to these households? Have I misunderstood? I would welcome his clarification. I know that he will want to support carers and hope that he is in a position to hold out some hope of concession on this issue. I hope that, at the very least, he will take this matter away for consideration.

Welfare Reform Bill

Debate between Baroness Hollis of Heigham and Baroness Meacher

Tuesday 8th November 2011 Grand Committee

[Lord Freud]

Moving swiftly on—Amendments 72A and 73 exclude from time-limiting any days contributory ESA claimants in the WRAG have received ESA for before this clause comes into effect. We expect that around 100,000 people will have been in receipt of contributory ESA in the WRAG for more than 12 months by April 2012, plus an additional 100,000 who will reach 12 months’ duration in the WRAG during the rest of 2012-13.

On the issue raised by my noble friend Lady Thomas on retrospection, a benefit claimant has no right to receive ESA indefinitely if the conditions of entitlement change or their circumstances change and they no longer meet the conditions of entitlement. Through the amendments made by the Bill, we are changing the conditions of entitlement for the future so that entitlement will not end until Clauses 51 and 52 is commenced. This will not affect any entitlement that has already arisen. I assure noble Lords that we are not seeking to recover past ESA payments that claimants have received correctly, but merely defining their future entitlement to ESA on the basis of whether at the time the clause is commenced they have had ESA already and if so for how long, and whether they are in the WRAG. We took the decision to issue 115,000 notification letters to all claimants potentially affected by this change to ensure that they were given sufficient notice. This generated around 4,200 inquiries from claimants in response.

We wish to strike a balance between fairness of treatment for all those affected and complexity. We do not think that it is reasonable that people in the WRAG who have already received contributory ESA before Clause 51 comes into force should continue to do so for an additional year after the clause is commenced. This would be unfair to new claimants; we want as many people as possible to receive benefit for the same period of time. Given the very difficult financial position that we inherited from the previous Administration, this is another difficult decision that we have had to make to ensure that the economic well-being of our country is protected.

[Baroness Meacher]

Can I just raise a question? The Minister talks about the unfairness about those in the future and those in the past, but that issue exists anyway. People who started claiming 18 months or two years ago, or whatever, clearly had a different length of contributory ESA to those people who claimed any time from 1 April last year in the Government’s terms. What I was suggesting was that the conditions are changing as of 1 April next year, and it is retrospective to suggest that the conditions change from 12 months previously. That is what is retrospective. Of course, you will always have unfairnesses between the past and the future when you change laws. It is not logical to suggest that there is some sort of inequity between past and future and, therefore, there is no retrospection. I think that the Minister has to accept that there is retrospection here.

[Baroness Hollis of Heigham]

My Lords, perhaps I may add to the Minister’s woes. He will no doubt be aware that previous Administrations faced this difficulty when we moved from IVB—invalidity benefit—to incapacity benefit. What happened was that people on invalidity benefit remained on that benefit and only new entrants went onto incapacity benefit. That is one path. I can quite see that allowing long-term claimants to have two or three different paths is technically complicated and administratively undesirable, but it is what is most supportive and decent to the individuals concerned. Their expectations are not suddenly changed part-way through their later years.

The second path that the noble Lord could adopt would be to say that from now on, at a certain date, this will be a common rule for all new and existing applicants. That would be the middle path. What would clearly be wrong would be to say that this will apply only to new applicants and that we will knock off existing claimants who have come up to the time barrier. I have never known that in social security before—ever.