Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
“Information sharing in relation to the Social Fund
Before sharing information regarding eligibility for services under section 69(3) of this Act, the Secretary of State shall satisfy himself that the Local Authority is intending to deliver these services in accordance with the purposes set out in the settlement letter that accompanies any payments made from the Consolidated Fund under section 69 and that arrangements have been made to report on the use of these payments.”
Baroness Lister of Burtersett
My Lords, this amendment has the support of the noble Lords, Lord Kirkwood of Kirkhope and Lord Blair of Boughton, to whom I am grateful. The noble Lord, Lord Blair, asked me to say that he is lecturing in Oxford and, if he is unable to reach the House in time, to assure your Lordships that he means no discourtesy by his absence. He also asked me to remind the House that he has spoken twice in support of the Social Fund earlier on Report, seeking the Government’s commitment to require councils to preserve this money and account for its spend on the objects of the Social Fund. I know that the noble Lord, Lord Kirkwood, is chairing a committee of the House and I am hoping that, like the cavalry, he will come over the hill—or through the Bar—to my rescue. If not, though, his strong support for an amendment along these lines is on the record both in Committee and on Report.
I apologise for returning once more to the Social Fund, and I will not rehearse all the arguments again. The reason why I have tabled yet a further amendment is that I felt in our previous debate that Members of your Lordships’ House were disappointed with the Minister’s response to the concerns raised around the House—disappointed because the Minister clearly agrees with the central underlying objective of these amendments. As the noble Lord, Lord De Mauley, assured your Lordships’ House, we are equally committed to ensuring that this money is targeted on and reaches the most vulnerable people. Previously, the Minister said that it was quite clear that we need to ensure, if we are putting money out for vulnerable people, that it goes to vulnerable people and is not diverted elsewhere.
The money that we are talking about is that which is currently paid out in community care grants and crisis loans under the discretionary Social Fund to provide vital cash assistance at times of acute need. I note that in today’s Guardian the Minister, Steve Webb, writes:
“To say the social fund is set to be abolished is completely false”.
However, in response to a Written Question from Karen Buck MP on 5 May 2011, he stated:
“The Social Fund is not being devolved to local councils. The Welfare Reform Bill includes proposals to abolish the discretionary Social Fund”—[Official Report, Commons, 5/5/11; col. 898W]—
in other words, the part of the Social Fund that we are debating here today.
The vulnerable people to whom the Minister referred include women who have fled domestic violence, young people who have left care and people with chronic health conditions or disabilities who need help with household items in order to live independently in the community. Family Action, to which I am grateful for all its hard work on this issue, has provided noble Lords with a number of examples of the value of the Social Fund to people in such circumstances. I shall quote just one:
“Lisa was awarded a Community Care Grant after being forced to leave her furniture and most of her possessions behind when she fled a violent partner with her three sons. She lived in a refuge and then temporary accommodation. When she moved into permanent accommodation, she had hardly any belongings and no money to furnish the partially-furnished house. Lisa’s fear of being isolated and lonely in her unfurnished, unpainted room was exacerbating her mental health problems, making her unable to unpack any of the items from her move. She slept in the bed of her middle son and her social worker emphasised how important it was to furnish her room, so she could sleep alone and move towards an independent and organised life. Lisa was awarded a grant for a bed, bedding and drawers, which helped her feel more at home, gave her the emotional strength to start unpacking her boxes, and meant her and her middle son were able to sleep comfortably, alone. She said ‘I’ve been waiting for this flat for six-and-a-half years, and for once in my life I can call a place home for the first time. For once in my life, my kids and I have a home… I just want to get myself better’”.
Family Action says that thanks to this help,
“Lisa was able to start rebuilding her shattered confidence”.
The noble Lord, Lord De Mauley, tried to convince your Lordships’ House that the safeguards that he had offered in response to an earlier amendment would,
“ensure that the money intended for vulnerable people goes to vulnerable people”—[Official Report, 11/1/12; col. 215.]
But there are no real safeguards. There will simply be a detailed settlement letter—and I thank the noble Lord for clarifying the contents of it—a specific revenue grant, and a review of a cross-section of local authorities in 2014-15 to see how they have spent the money. While these are all welcome, they are not by any stretch of the imagination genuine safeguards. There is nothing to prevent hard-pressed local authorities spending the money on other pressing demands—and authorities admitted as much in their responses to a DWP survey. It could be to make up the shortfall from the money being devolved for council tax benefit or even, as the noble Lord, Lord Newton of Braintree—now officially crowned hero on this matter—suggested, be spent on a swimming pool. I note that the noble Lord, Lord Fowler, is now in his seat. The irony of my standing on this side of the House, defending the Social Fund, which I attacked when the noble Lords, Lord Fowler and Lord Newton, introduced it, is not lost on either of us.
Lord De Mauley
My Lords, during the passage of the Bill there has been much discussion of the reform of the discretionary Social Fund, and how we can ensure that the money intended for vulnerable people goes to them—an aim with which, as the noble Baroness, Lady Lister, generously acknowledged, I am completely in agreement. However, imposing restrictions on local authorities through data sharing, as the amendment seeks to do, would take us a little away from the central issue of how best to ensure that the funding achieves its intended purpose.
The noble Baroness’s Amendment 62BJA would mean that the Secretary of State would have to ensure that he was satisfied that a local authority planned to use the funding, which will replace community care grants and crisis loans for general living expenses, for the purposes set out in the settlement letter, before he could share information with a local authority about eligibility for assistance under the new local provision. The Secretary of State would also have to be satisfied that arrangements had been made to report on the use of the funding.
I appreciate the noble Baroness's intentions in moving the amendment. Despite its drafting, and despite what the noble Lord, Lord McKenzie, said, I read it as another approach to the issue of ring-fencing the funding that will go to local authorities. Although I do not think that it will achieve that, I will say, as I said before, that a ring-fence is not the best way to ensure that the money reaches vulnerable people. Ring-fencing would mean that local authorities could be constrained, for example, from investing in existing services, or pooling the money with funding from pre-existing services to provide a comprehensive and effective support system for the most vulnerable people in their communities.
The Government fully agree that it is very important to have adequate controls in place to ensure that the funds are used in the way intended. We have clear agreement on that point. However, I will explain why the amendment is unnecessary. Other controls are in place to provide checks and balances before, accompanying and following the initial allocation under the new provision. Perhaps I have not been adequately clear about these so far.
First, I turn to the current element of the steps that we are taking—what I might call the “before” steps. Departmental officials have already conducted a great number of meetings and workshops with local authorities to support them in preparing to deliver the new local provision. We will continue with this support by holding a series of workshops with all upper-tier local authorities over the coming months. The workshops will consider in detail how transferred funds could be used to maximum effect from April 2013. Through the sharing of ideas and best practice, they will assist the development of new services and will help local authorities identify how the funds can be used to best effect to support the most vulnerable. The participants and outcomes of the workshops will be published on the DWP website as part of our ongoing package of advice and information for all local authorities.
The settlement letter—what I might call the “accompanying” step, because it will accompany the funding that local authorities receive for delivering the new provision—will set out, as we discussed at some length last week, what the funding is to be used for and the underlying principles, and will describe the outcome that must be achieved. On 17 January this year, having further considered our debate of the week before, I laid out exactly what the settlement letter would contain. My noble friend Lord German made the point that local people and communities can hold their local authorities to account. The detailed settlement letter will help them do that. Furthermore, as I explained, in order to underline its purpose the funding will be distributed to local authorities through a specific revenue grant rather than being included with the rest of their general expenditure in the main revenue support grant.
I shall move on to the “following” steps. Following the introduction of localised assistance, the department has already made plans to conduct a review in 2014-15 to obtain appropriate information from a representative cross-section of at least 50 local authorities, which represents one-third of the total, in order to help inform future funding levels. We have committed to using this opportunity to gather further information about the way in which local authorities have used the funding. I contend that this review will be more valuable than the information required under this amendment. It will tell us about how the provision is working and what the funding is being used for, whereas this amendment would require a judgment to be made about the intention of a local authority before it delivers the new scheme. In addition—and this is critical—as local authorities will not know in advance which of them will be involved in the review, the risk of scrutiny and exposure from the review work will also help to drive their behaviours and, in theory, they may otherwise have been tempted not to comply in full.
Turning to the amendment itself, I suggest that it would be unreasonably burdensome to expect the Secretary of State to make a case-by-case check on every local authority that requires information about eligibility from the Department for Work and Pensions. As I said a moment ago, we estimate it would be approximately 150 local authorities. Indeed, the amendment presumes that local authorities will approach the department about eligibility for their local schemes, but this may not happen in every case. It will be for each local authority to decide which vulnerable people in its area would most benefit from the new local provision. This is the point. This is about trusting local authorities. They are best placed to make these decisions, as they will already be working with vulnerable people in their area through the other services that they provide. This local knowledge will help them to decide how to tailor support, and they may not feel that they need to approach the department for any information in order to do this.
Even if the obligation contemplated by the amendment were necessary, which, as I have explained, we contend it is not, primary legislation would not be the place for it. Regulations under Clause 129 will prescribe the purposes for which the department can share benefit information with local authorities, and the agreements reached with local authorities will make clear that the information is to be supplied only if it is for a prescribed purpose—in this case, determining eligibility for the new local provision.
We are already working with local authorities to make sure that they are ready to deliver this support. The settlement letter will make explicit that the funding is to provide a replacement provision for community care grants and general living expenses crisis loans. It will be clear that the funding is meant for vulnerable people and about the outcomes that should be achieved. The review will offer a check on what local authorities have done with the funding they received and will provide accountability.
The noble Baroness, Lady Lister, asked why a light-touch reporting system cannot be set up. Local authorities will be using money in a variety of ways, all directed towards meeting the needs of vulnerable people. Any system, no matter how straightforward, would, by its very nature, have to be complex to capture and assimilate all the money and the varied information.
The noble Lord, Lord McKenzie, and other noble Lords raised Supporting People as a demonstration, in their eyes, of how non-ring-fencing produces a risk. The Supporting People funding was deliberately incorporated into the main formula grant in order to provide local authorities with maximum flexibility. Our funding will not be included in the overall grant. It will be part of a special revenue grant. In addition, we are working and will continue to work with local authorities before the funding is allocated to devise plans for using and targeting the money and, as I have said before, we will review over one-third of them to ensure that the money has been spent appropriately.
My noble friend Lord German, who must have no idea how grateful I am to him for his very helpful words, asked the important question about Wales and Scotland. The funding will not be transferred under the Barnett formula; it will be allocated through a special grant. The funding will be based on the equivalent Social Fund spend for 2012-13, and it should be noted that Scottish policy is also not to impose a ring-fence.
The noble Baroness, Lady Hollis, asked about the tension between upper-tier and lower-tier authorities. The funding is allocated to upper-tier local authorities in order to provide the greatest possible flexibility to local areas. From our discussions with local authorities, we know that a range of delivery models are being considered, some of which will result in some funding being devolved to lower-tier services such as housing. Decisions about the ultimate funding for each area will be determined by a range of local factors, including the location and nature of existing services, and how these align with areas of deprivation and need and the level of funding that will be devolved. In some less deprived areas it may not be necessary or practical to operate a number of services.
Local authorities have been enthusiastic and engaged with this process and I am confident that, given what I have said, they will continue to act in a responsible and fair way to protect the most vulnerable in their communities. I hope I have addressed the issues noble Lords have raised, and I ask the noble Baroness to withdraw her amendment.
Baroness Lister of Burtersett
My Lords, I am very grateful to all noble Lords who have spoken. I have to say, when I was calling for the cavalry, I had not expected its generals to be two former social security Secretaries, the noble Lords, Lord Newton and Lord Fowler. I am very grateful to them for what they have said. I particularly thank my new hero, the noble Lord, Lord Newton, for his strong words in favour of the amendment.
The noble Lord, Lord Skelmersdale, rightly said that the key is the settlement letter and what happens if a local authority does not abide by it. I do not know about the noble Lord, but I have not heard an answer to that question. In Committee, the noble Lord, Lord Kirkwood of Kirkhope, and I came to a great defence of the principle of the Social Fund. I would not say that we had been wrong at the time, but we accepted that the Social Fund had worked out better than we had expected. We all agree that it needed reforming. The problem is that reform is not the same as the partial abolition that is taking place now. I would still have preferred the old system of statutory single payments, but that is history and that is not what we are here to discuss.
I am very grateful to the right reverend Prelate the Bishop of Manchester for the point he made about accountability. It is interesting that the noble Lord, Lord German, made the same point in Committee, where I felt that he was not convinced that accountability would be achieved. I know a letter was written to him, and I was not convinced by that letter that accountability would be achieved. The noble Lord, Lord German, raised a question about the local electorate holding local authorities to account. The people for whom the Social Fund is so vital are the people who are least likely to vote in local elections and be on the electoral register. As much as I would like to think that other members of the community will put the interests of potential Social Fund users at the top of their concerns when voting, I am afraid that it is simply not going to happen. Local organisations should not have to prise the information out of local authorities to try to make them accountable at the ballot box.
Yes, we do trust local authorities. This amendment is not about bashing local authorities. This is not an amendment that says, “I do not trust local authorities”. However, local authorities are under huge pressure in terms of spending. We trusted them with the Supporting People grant, but, as I have said, they are making disproportionate cuts in it—not because they want to hurt vulnerable people but because it is easier to make cuts in the money that goes to marginalised groups than it is in, say, weekly bin collection.
I am very grateful to the Minister. I get the sense that his heart is not really in what he is saying today.
Baroness Lister of Burtersett
He has put up a very noble defence of the Government’s position. But the noble Lord, Lord Newton, put his finger on it. I did not like to say this myself as a member of the Opposition. The resistance to an amendment on these lines is not coming from the Department for Work and Pensions; it is coming from the Department for Communities and Local Government. As the noble Lord said, we should not allow the localism agenda to trump the needs of some of the most vulnerable people in our society.
I very much welcome the full and strong steps that the department is taking to try to engage local authorities in seminars and so forth. That is all very valuable. But ultimately there will be no come-back if local authorities do not use the money for the purposes voted for by Parliament.
I have listened carefully to noble Lords on three or four occasions and each time we inch a little further towards where we are trying to get. But on none of these occasions have I been satisfied that we will achieve genuine accountability and that any mechanisms are in place to ensure that the money voted for vulnerable people will be spent on them. As my noble friend Lord McKenzie said, at a time when we are all being told about public spending being under such pressure, surely it is that much more important that the money is spent on the purposes for which it is intended.
Given that nearly everyone who has spoken has spoken in favour of the amendment and that I do not feel that the Minister has addressed questions put by his own side of the House, I wish to test the opinion of the House.
Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Hayter of Kentish Town
My Lords, we form a select few still in the Chamber. I remind noble Lords that the Child Poverty Act 2010, which established the Child Poverty Commission, was passed with cross-party support. We believe that there is now similar support for the proposal to expand its remit to deal with social mobility. We welcome that move. However, our Amendment 62F seeks to ensure that the commission has a duty, an obligation and a right to advise Ministers so that the fruits of its expertise, research, understanding and work are put at the heart of decision-making. This is not to replace the Government’s role in decision-making but to input at the appropriate level into the intelligence available to the Minister, as strategies to tackle child poverty are developed and implemented. Amendment 62CZA seeks to ensure that the child maintenance and enforcement policies similarly do not fly in the face of objective, evidence-based advice. The Child Poverty and Social Mobility Commission may be a very valuable think-tank, academic centre of excellence and great publishing venture but without this duty to advise it will not be guaranteed a voice in Whitehall.
We naturally warmly welcome the Government’s Amendment 62JA, which appears to meet our request in Amendment 62K, and which enables Ministers to provide the commission with any resources, including research, which Ministers think are required for it to carry out its functions. Perhaps the Minister will confirm that this will enable the commission to request research directly where it believes that there are important gaps in the data available to it. Will the Minister also outline what might happen if the commission believes that such research is necessary but the relevant Minister does not? While we are delighted that the Government have seen the need for such research, it would be useful if the Minister could also say when exactly he expects the new commission to be established, as we need its input. These amendments are needed to strengthen the role of the Child Poverty and Social Mobility Commission. Amendment 62F is central, not an add-on, to the work of the commission. It would restore the duty for the commission to give advice to Ministers on the preparation of their strategy. The DWP note states:
“The Government believes that policy development should be the responsibility of Ministers … and should not be delegated to arm’s length bodies. The Commission’s current advisory role inadvertently provides a route for Ministers to avoid accountability if the Strategy proves ineffective by shifting responsibility to the Commission”.
It goes on to state that the commission will henceforth only be able to give advice on technical issues around the measurement of poverty and social mobility.
We welcome the strengthened accountability whereby the annual report of the commission will report on progress towards the target. Far from being incompatible with the commission providing advice on the strategy, part of that advice comprises being able to input into Ministers’ thinking on matters beyond just technical issues around measurement. A serious commission with quality members and staff will be hard to establish if it is denied the existing duty of advising Ministers. What, after all, will be the point of it as opposed to having this work done by a university department? There is no chance that Ministers would simply delegate development of a strategy to an unelected commission. It is clearly Ministers on whom the ultimate duty to eradicate child poverty falls, and who will be answerable in this House and elsewhere for the success of that strategy. Placing on the commission the duty to give advice to the Government would strengthen its role and status, allowing it to provide the independent scrutiny, intellectual challenge and source of expertise that were envisaged in the original Child Poverty Act, which passed with cross-party support. I beg to move.
Baroness Lister of Burtersett
My Lords, I rise briefly to support the amendment of my noble friend Lady Hayter. However, her case was made on the assumption that the commission will have expertise. The original requirement that commissioners must have expertise relevant to the work of the commission has been taken out by this legislation. Apparently, the Government have argued that, because the commission will be a reviewing rather than an advisory body, the expertise requirement is no longer needed in the schedule. However, as End Child Poverty points out, this makes no sense. Reviewing requires just as much expertise as advising.
I should therefore be grateful if the Minister could give a rather better explanation as to why that provision has been taken out, because it is in danger of weakening the commission. I understand that the commissioners will be appointed through the non-departmental public body appointing process. Can the Minister explain how the process will work in this instance? What type of expertise do the Government believe is necessary for the commission, taken as a whole, to have? How will the NDPB appointment process ensure that the commission has such expertise? We are of course talking about expertise on both child poverty and social mobility. It is perhaps also worth considering not just traditional academic forms of expertise but the expertise born of experience.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)
My Lords, at the start of these two groups of amendments on the child poverty commission, I want to make it clear that this Government are absolutely committed to tackling child poverty. Our child poverty strategy, published in April last year, set out the package of reforms that we are implementing to ensure that no child faces a life trapped in poverty. As part of this, we want to create a new and more powerful commission that can assess the progress made as reforms are implemented.
Amendment 62F seeks to ensure that the commission continues to provide advice to the Minister as to how to eradicate child poverty. As noble Lords are aware, the new Social Mobility and Child Poverty Commission differs from the original child poverty commission in a number of important aspects. First, it will have a broader remit that will encompass social mobility as well as child poverty. Secondly, it will for the first time have the power to publicly assess government progress. The previous child poverty commission’s role was simply to provide advice to government. The new commission is required to produce an annual report that assesses whether the Government are taking the steps that they said they would in their strategy, and it will therefore have the opportunity to hold the Government to account for the steps that they are taking and point out where they are falling behind. This will ensure that Ministers are still responsible for developing the strategy, as is right, but that there is external examination to ensure that it is being implemented.
Finally, the commission will no longer play a direct role in the development of the Government’s child poverty policy. This third change is crucial if we are to maintain our commitment to ensure that unelected public bodies are not established unless there is a clear need for their work to be carried out independently of government. This is one of the three key principles of the review of public bodies carried out by the Government last year. It is the role of the Civil Service, directed by Ministers, to develop policy. This is not a job for external bodies.
We cannot justify establishing a public body to provide advice when there is already a wide variety of ways in which government can access such guidance. Indeed, many of the organisations that we might expect to see represented on such a body provided recommendations on the current child poverty strategy via our extensive consultation exercise. Giving a single public body a statutory power to provide advice to government on child poverty policy also risks undermining ministerial accountability. It offers a degree of scope for Ministers to shift responsibility for their policy to an external body. When publishing its report each year, the commission will have the opportunity to advise the Government on steps that they should be taking to implement the strategy. As an independent body, the commission would be able to respond to government consultations and put points to Ministers, alongside other organisations with an interest. It is a fundamental principle of this Government that Ministers are accountable for the policies and strategies they put forward. Therefore, while we will continue to consult widely on this policy area, we do not believe that the commission should be given a special, statutory role in providing advice.
I can tell the noble Baroness, Lady Hayter, that we are committed to establishing the new commission as soon possible, once the necessary legislative changes are made. That means, given that I need to define “as soon as possible”, that as soon as the amending legislation has been passed we will begin to put the new commission into place.
If the commission thinks research is required but the Minister does not, whether or not a particular request is granted will be a matter for private discussion between the Government and the commission. The commission will be able to request research directly; there is provision for it to do that.
On the issue of the expertise on the commission, raised by the noble Baroness, Lady Lister, we intend that it have the appropriate balance of expertise in child poverty and social mobility and we agree that a commission without specific expertise in these areas would not be effective in carrying out the functions set out in the Bill. How will we conduct the appointment process? All members of the commission, including the chair and the deputy chair, will be appointed using a fair and open recruitment process which meets the standards required by the office of the Commissioner for Public Appointments.
Baroness Lister of Burtersett
I am sorry to interrupt, but I also made a point about expertise born of experience. I sat on the Commission on Poverty, Participation and Power, half of whose members had experience of poverty. It was one of the most rewarding experiences of my career, because the insights of those with experience of poverty were such that I could not bring to the subject. Will the Government be open to such expertise?
Lord Freud
Yes, my Lords. I hope that I was making clear that our intention is to get people who are experts in the area. It is hard to overspecify what that means, but people in that category could provide a powerful insight. I am not going to write the job spec in detail tonight, but clearly those would be attractive sets of experience for the commission.
Amendment 62CZA would require that any steps taken in relation to collecting child support maintenance should be consistent with advice given by the Social Mobility and Child Poverty Commission. I will stick precisely to the point in relation to the commission rather than straying back into some of the discussions we had earlier this evening. Our view is that the commission should not be involved in developing policy. From that it follows that we do not think that it should develop policy on child maintenance. That is something for which Ministers alone should be responsible—or perhaps responsible for alongside the House of Lords.
Moreover, where payments are reliable and regular, child maintenance provides parents with care with a separate income stream that may improve the lives and life chances of some children in or near poverty. We have concluded that child maintenance payments are estimated to have a small, non-reportable impact on the number of families living in relative income poverty as currently measured and with current data sources.
Amendment 62JA, the government amendment, and Amendment 62K, would both create an explicit provision in the Bill for the Government to carry out research at the commission's request if it so wishes. We addressed that issue briefly in Committee. I gave assurances that having that provision in the Bill is unnecessary. The Bill already enables Ministers to provide the commission with any resources, including research, which Ministers think are required for the commission to carry out its functions. However, given that the issue has arisen again, we decided to table an amendment to allay any remaining concerns. The government amendment provides that Ministers have the power to carry out or commission research at the request of the commission if they so wish.
Before I ask the noble Baroness to withdraw the amendment, I make it clear that the Government do not consider any of the amendments consequential. I commend Amendment 62JA.
“(2A) Section 57 (entitlement of lone parents to income support etc) will come into force no earlier than 1 April 2013, and not before the implementation of universal credit.”
Baroness Lister of Burtersett
My Lords, yesterday the noble Lord, Lord Kirkwood, said to me, “Trust you to have the last amendment”. I am not sure that it was a compliment. Amendment 69 relates to the implementation timetable for Clause 57, which ends entitlement to income support for lone parents whose youngest child is aged five. This is to be introduced as soon as possible after the Bill receives Royal Assent. This modest amendment seeks only to introduce a delay to the implementation of the proposed change to ensure that it aligns with the planned introduction of universal credit, and to encourage the Minister to put on the record some concessions that would ease the situation of the lone parents affected.
Moving an additional 100,000 lone parents off income support and on to jobseeker’s allowance when their youngest child reaches five is a short-sighted measure in the current economic climate. Increased conditionality and tougher sanctions serve only to add unwarranted pressure on lone parents, when suitable employment opportunities remain sparse and access to further education is curtailed by work-related requirements. Critically, lone parents who find work of less than 16 hours per week will be unable to take advantage of the new childcare support provisions for at least 18 months. This potent mix could leave lone parents stranded on out-of-work benefits and unable to secure the foothold they need to enter the labour market on a sustainable basis.
Longitudinal research with lone parents who had elected to move into employment and with their children underlines the importance of such a secure foothold. The research was carried out for the department and was indeed cited in a note that the Minister kindly circulated on the impact of maternal employment on schoolchildren. This note referred to the evidence in the research of how lone parents’ employment can provide a good role model for their children. However, the research also found that that is not always the case. One of the researchers, Tess Ridge of Bath University, writes that,
“encouraging lone mothers into unstable and insecure labour markets runs the risk of alienating children from the values of employment. For these children work had held out the promise of something better and that promise had not been kept, so they also experienced disappointment and for some an apparent loss of confidence in the value of work”.
In light of such findings, my advice to the Minister is: more haste, less speed. The long-term gains associated with requiring the lone parents of younger children to be available for paid work might be better achieved by adopting this amendment.
As I argued in Grand Committee, gaining a level 3 or higher qualification makes a significant difference to the amount of money a lone parent can earn and increases their chances of upward mobility. Work search and work availability requirements will severely limit the ability of lone parents to gain qualifications and skills that could help them find higher paid employment that is sustainable, and to make the most of opportunities to progress once working. Currently, lone parents can receive a fee remission if claiming JSA. However, they are also required to continue to seek work while studying and be prepared to leave a course if offered employment. If they refuse, they face a payment sanction. It seems to me that in these circumstances work-related requirements inhibit, rather than enable, a claimant’s ability to find better paid employment. This is an unintended consequence, I am sure, and is in fact preventable. Previously, lone parents on income support could complete a full-time further education course, up to and including level 3, when their children started school, and crucially before moving on to jobseeker’s allowance—a benefit with significantly higher conditionality.
The prescribed circumstances in Clauses 22 and new Section 6F—inserted by Clause 49—should, I would argue, permit access to further education up to and including level 3, and training for responsible carers claiming JSA or universal credit. This means that, if undertaking a further education or training course, they should be treated as fulfilling work search and work availability requirements until their course ends or their child turns seven. This would allow responsible carers to “skill up” and increase their earning potential when their youngest child starts full-time education. This is entirely consistent with the Government’s anti-child poverty and social mobility strategies, which emphasise the importance of education and training and the contribution they can make to ensuring that paid work represents the best route out of poverty. The Minister expressed some sympathy with the arguments presented in Committee when he was pressed by the noble Baroness, Lady Meacher, to write greater flexibility into the Bill. I wonder whether he has been able to give further thought to this and perhaps go rather further than he was able to in Committee.
Lone parents require jobs that allow them to be there for their children when they need them. With only one parent to do the school run, care for children when they are ill and support them with their school work, jobs with flexible working patterns are absolutely vital, as is access to affordable, high-quality childcare. On this point, the announcement that the Government will extend support for childcare costs to those working under 16 hours is very welcome. This is due to be implemented as part of universal credit from October 2013 onwards. The demand for jobs of less than 16 hours per week, so-called “mini jobs”, is likely to increase as lone parents of five and six year-olds look for work that dovetails with their caring responsibilities. The extended help with childcare costs will be of particular benefit to this group of lone parents. However, unless the implementation of Clause 57 is delayed, 100,000 lone parents of younger children will be unable to access it for up to a minimum of 18 months, if offered a job of less than 16 hours a week.
Finding the money to pay for childcare can be a significant hurdle for lone parents and is often the straw that breaks the camel’s back when it comes to making work pay. Until very recently, responsible carers in short-hours jobs could access financial help towards childcare costs. Prior to April 2011, a time-limited discretionary in-work childcare subsidy payment was available for lone parents and partners on the New Deal and who worked less than 16 hours. This provision has since been abolished and incorporated into the flexible support fund. This is a generic pot of money for discretionary use by advisers to cover a wide range of claimant’s needs and is available only when all other avenues of possible financial support have been explored.
Might I suggest that introducing an interim payment akin to the previous in-work childcare subsidy would be a positive work incentive for this group of claimants during the interim period? I am sure that Gingerbread, to which I am grateful for help with this amendment, would be keen to discuss the possibilities with the Minister, who has said that he always has an open door.
To conclude, there is a strong case for delaying the implementation of this policy to coincide with the introduction of universal credit in order for the Government to achieve their objectives. However, if this policy goes ahead as planned, it would require the kind of additional interventions that I have outlined, and I therefore hope that the Minister will look favourably on them and at the very least make a commitment to give them serious consideration. I beg to move.
Lord Freud
My Lords, as noble Lords are aware, our focus is on supporting and helping to lift children out of poverty and improve their life chances by encouraging lone parents to enter paid work. Evidence shows that paid work is good for lone parents and their children in nearly all circumstances. Indeed, just under 80 per cent of lone parents with a youngest child aged five or six are either in employment, looking for a job, or would like to work.
Many lone parents consider making the transition to work when their youngest child starts school, and it is for these reasons that we announced our intention to align the age at which lone parents could reasonably be expected to look for work to when their youngest child reaches the age of five. This means that once a lone parent’s youngest child reaches the age of five we would want the parent to claim jobseeker’s allowance if they are capable of work. If they have limited capability for work, they would claim employment and support allowance, unless they are entitled to income support on some other ground, for example as a foster carer. If we delay carrying out this change and wait for the introduction of universal credit, we delay bringing these lone parents closer to the labour market, delay making any benefit savings but, more importantly, delay lifting more children in lone-parent households out of poverty.
Picking up the point on the current economic situation, it is important that we do not repeat the mistakes of past slowdowns and allow people to slip into inactivity. In fact, one of the best things about this economic slowdown—and there are not many good things about it—is that we have not let more people fall into inactivity. In fact, there is less economic inactivity now than a couple of years ago. Maintaining our active labour market policies will ensure that people, including lone parents, do not become detached from the labour market and are well placed to benefit when the economy picks up again.
As noble Lords are aware, this is especially significant because, compared to a child of a lone parent who is not working, a child of a lone parent who works part-time is almost three times less likely to be living in poverty, and a child of a lone parent who works full time is five times less likely to be living in poverty. While we want lone parents to enter work, we do not want them to do so at the expense of their caring responsibilities. This is why we maintained the right for lone parents to restrict their availability for work to school hours, and we will retain all other flexibilities within jobseeker’s allowance to ensure that lone parents can balance caring for their child while working. I described all those measures in Committee, and I shall not do so again given the lateness of the hour.
I stress that this initiative is an important lever in lifting lone parent families out of poverty. If it were delayed until October 2013, it would result in about 17,000 fewer lone parents being in work, which in turn would prevent increases in household income for up to 25,000 children. However, in response to the noble Baroness, Lady Lister, I am conscious of the importance of putting together training and employment strategies. When I wrote my report in 2007, the two strategies were so far apart that they never met. They are moving together, and my view is that we should move them as close as we possibly can, so the door is particularly wide open to discuss with the noble Baroness and, perhaps, with Gingerbread how we can achieve that in the months and years to come.
With that explanation, I ask the noble Baroness to withdraw her amendment.
Child Poverty
Baroness Lister of Burtersett Excerpts(12 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Freud
My Lords, we are concerned about the slow way that people on ESA are moving into the work programme and we are looking closely at how to accelerate that process. Clearly, one of the ambitions of the programme is to get the hardest-to-help people back into the workforce, and there has been a rather slow start in that area.
Baroness Lister of Burtersett
My Lords, can the Minister explain why the Government dismissed the projected 100,000 increase in child poverty due to tax credit cuts as a “statistical quirk” arising from the relative nature of that poverty when, in opposition, the Prime Minister promised,
“loud and clear … the Conservative Party recognises, will measure and will act on relative poverty”?
Lord Freud
My Lords, one of the recent decisions we have taken was to up-rate benefits by the CPI at 5.2 per cent, when average earnings in the period have increased by 2.8 per cent. Interestingly, that is the core reason why the IFS projections for this year and next show a decline on last year. Looking further ahead, we clearly have a lot of work to do in maintaining any reduction in child poverty and the IFS warns us that we need to have government policies to do that. However, I should point out that what we are driving towards is behavioural change, whereas the IFS measures concrete changes of income transfer.
Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Corston
My Lords, I want to speak briefly about child benefit. I was very proud of the fact that in 1977 the then Labour Government, under Jim Callaghan, brought in child benefit. At the time, there was a huge campaign saying that it was taking money out of the wallet and putting it in the handbag. We said, “Yes, that’s exactly what it is going to do and it is exactly what it should do”. My noble friend Lady Gould, who was my boss at the time as chief women’s officer for the Labour Party, and I played our part in making sure that Jim Callaghan knew what the women of the Labour Party thought about child benefit.
I want to address my comments to a particular part of this argument about child benefit being a benefit that is paid to the carer of the child. It is money that goes to women. In my work with women in prison, I have more than once come across a tragic phenomenon where a woman shoplifts. I know of a case in the south-west of England where a woman shoplifted 99 times in a year, each time for food for her children. Her husband had control of the family income—whatever that family’s income is, and it might be benefits. The only money she had was the child benefit and all of it went on feeding her children, but it was not enough and she therefore stole food. I say to the Government: you think very carefully about the effect that any incursion into child benefit—as a universal benefit payable to the carer of the child, irrespective of income—will have, and that is a hugely important principle. If people do not need the benefit, then use the income tax system to make sure that there is a redress, but please do not, without thinking very carefully, attack a benefit that is the only means whereby some women can feed their children.
Baroness Lister of Burtersett
My Lords, the noble Lord, Lord Hamilton, asked questions about the morality of the current situation. I should like to ask this House, following the point made by the noble Lord, Lord Kirkwood: is it moral that we are deliberately pushing families with children below the level of income that Parliament has decided is necessary to meet their most basic needs? Research shows that that money is not sufficient to meet those basic needs, as determined by the wider population.
A number of noble Lords, including the noble Lord, Lord Fowler, on the government Benches, have asked questions about costs—I had a wonderful vision of the noble Lord wearing his “Action for benefits” badge in front of the mirror. In the other place, the Minister said that this is not primarily a cost-saving measure. What is it? He said it is primarily about changing behaviour, but my noble friend Lady Sherlock pretty well demolished those arguments.
The Minister also said that this is about restoring the credibility of the welfare benefits system. However, that credibility is being undermined by the misinformation being put out by Ministers about that system—in particular, the way that they slide between talking about average incomes and average earnings as if they are the same thing, when they are not. The median family in work receives £33.70 in child benefit as well as various other in-work benefits. The point was made that child benefit replaced child tax allowances. If that had not happened and we still had family allowances and child tax allowances, the median earnings of the average family would be that much higher because of the effect of child tax allowances. It is therefore really unfair that we are not comparing like with like and, as my noble friend pointed, when the Minister was pushed on this issue in Committee regarding how he could justify the fact that we are not comparing like with like, he simply did not have an answer.
Baroness Wheatcroft
My Lords, I did not join your Lordships' House in order to kick the underprivileged, particularly children, but I did believe that the Government were committed to healing the broken society. I do not think that any of us can doubt that society is broken, and we would all agree that there is a need to heal it and that dealing with the dependency culture is an important part of that. That is something that I believe in absolutely. That is at the heart of this legislation. To my mind, the worst sort of child poverty is poverty of aspiration.
Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Lister of Burtersett
I will speak briefly in support of Amendment 60A. The noble Baroness, Lady Hollins, has probably not had a chance to see the latest impact assessment, which hit our e-mail accounts only a few hours before this debate. There is now a section in it about carers and I would like to add to what she said. The assessment said that 5,000 carers are expected to be affected by the cap. It is a small number but it is 5,000 too many, in my view. The mean reduction in benefit as a result of the cap is £87 a week; the median is £65 a week. That is a lot of money for carers to lose. Can the Minister tell us what behavioural change the Government are looking for among carers?
Baroness Thomas of Winchester
I have a more specific question about disability living allowance and I think this may be the right place to ask it. If someone living in a high-cost rental area on local housing allowance has a serious accident or is diagnosed with a serious long-term condition, perhaps next March, and is placed in the ESA work-related activity group, they might apply for disability living allowance. They might have had a stroke that was not bad enough to take them out of the jobs market for a very long term but that would require them to take a long period of recovery, and they might have been quite badly affected. This person will have to be assessed and then wait for a qualifying period of three months. If during those three months the person in the household falls foul of the benefit cap, will they be penalised immediately or will their application for DLA be taken into account, which of course will then exempt them from the cap? This is an important matter which we have not heard anything about. It might be part of the transitional arrangements that we hope we will hear about, but I would hate that person, with all their difficulties, to have to think about having to look for another place to live when they are trying to recover from quite a serious illness.
Baroness Lister of Burtersett
My Lords, I rise to speak in support of Amendment 61B, to which my name is attached, and to Amendment 61C in my name. The amendments have a particular resonance for me. One of my clearest memories when I worked at the Child Poverty Action Group was sitting below the Bar during the passage of the then social security Bill under the Fowler review, of which we heard earlier, and literally jumping for joy when the Minister announced that the then Conservative Government would withdraw their proposal to pay family credit through the wage packet. I was given a severe warning by the attendant.
During my subsequent academic career I conducted Joseph Rowntree Foundation-funded research with Jackie Goode and Claire Callender that demonstrated the importance to the well-being of both children and women of paying benefits for children to the mother who was in all those families the parent with main responsibility for the day-to-day care of the children. This research helped to persuade the previous Labour Government of the error of their ways when they proposed to pay working tax credit through the wage packet. Now here we are again having to persuade the Government why it is so important to pay money for children direct to the parent who has the main responsibility for the day-to-day care of the children and for day-to-day budgeting. This time the stakes are higher, as the noble Baroness, Lady Meacher, has made clear because universal credit wraps up so much in it, including housing costs. The noble Baroness, Lady Meacher, has already made the case very powerfully for why what is colloquially known as “wallet-purse” is such a crucial issue, particularly for children and women.
I want to pick up a couple of the arguments made by the Minister in Committee, some of which I have to admit I was not convinced by. First, I make reference back to a point made by the noble Lord, Lord Lester, earlier when he talked about the report of the Joint Committee on Human Rights, which came out after our proceedings in Grand Committee. It commented on the reduction in the financial autonomy of women, resulting from the payment of universal credit to only one member in the household. In order to address that, the Committee suggested that the Bill could be amended to allow payments intended for children to be labelled as such and to be paid to the main carer.
One of the points made by the Minister was to try to reassure the Committee that making universal credit as a single payment will not now be a problem because the Government are committed to ensuring that people can access support to manage their payments and help them to budget effectively, including access to budgeting products, such as jam-jar accounts, as mentioned by the noble Baroness. I put that argument to an expert who understands jam-jar accounts much better than me, and who shares the Minister’s enthusiasm for them. Her response was that it was a bit of a smokescreen as there is no coherent link between budgeting accounts and the decision as to whom the benefit is paid. Moreover, what is at issue is not budgeting capabilities but financial autonomy. It is about ensuring that the parent with the every day care of children has control over the money allocated for them.
That brings me to another argument used by the Minister that the Government want to enable couples to decide where their payments should go. It is not for the Government to dictate how a family arrangements its finances. The only decision that the couple can make is between payment into one or other single account or a joint account. As the noble Baroness has already explained, joint accounts are not necessarily the answer. Research by Fran Bennett of Oxford University and others shows that the existence of a joint bank account does not guarantee access by both partners to the money held in it.
While I agree that it is not for the Government to dictate how a family arranges its finances, is it not the case that their belief in the power of nudge might point them to supporting this amendment? Presumably, the Government want the money allocated to meet the needs of children to be spent on children. As the noble Baroness pointed out, that is much more likely to happen if the money is clearly labelled for children.
If the Government refuse to countenance that approach, then I suggest that Amendment 61C might be the answer. It provides for a couple to choose for the payment to be split between accounts without earmarking any of the money for specific purposes. This would meet the Minister’s concern that universal credit should be seen as a single payment. In this case, it would be a single undifferentiated payment, but split between the two bank accounts when the couple so wished. It would allow for the variety that exists in the ways that couples organise their finances. I acknowledge that it is not a perfect solution for, as the Minister observed earlier in our proceedings, effective choice exists only when the balance of power is equal, and the gender balance of power is still often very unequal, but it would be more consistent with the Government’s position on choice and would be better than the only choice offered in the Bill, which potentially puts all the money into the hands of one partner.
As the noble Baroness emphasised, neither of these amendments would cost money, but they would help millions of women and children and address the very real problem of hidden poverty which can result when resources are not shared fairly within families.
Lord Kirkwood of Kirkhope
My Lords, I shall add a few comments to the speeches of the noble Baronesses, Lady Meacher and Lady Lister. I learnt the importance of this subject a long time ago when I was involved in consistorial legal work in a provincial legal office in south-east Scotland. I was surprised by the importance of financial autonomy to people within quite troubled and tense family contexts, as the noble Baroness, Lady Lister, mentioned. I was then persuaded yet again, academically, by the exemplary work that she has done ever since with Fran Bennett and others to make this case consistently over the years. It is as apt in this benefit reform as it was in the Fowler reforms or at any time since. I guess I could be persuaded that this is a debate that needs to be conducted at regulation level and I am certainly up for continuing an interest through the primary legislation until the regulations are tabled. I will be happy to contribute to those discussions.
There is a real question that I want to be clear in my head about. We had some interesting discussions in Grand Committee and I am certainly sympathetic to the Minister’s search for innovative financial products. I think it is absolutely correct. However, if you separate out the politics from all this, I would like to understand whether it is factually possible for the agile computer system that we are developing with such care in Warrington to deliver the device suggested in Amendment 61C. That is a separate question from whether the Minister is prepared to deliver it. I want to know that we are not blocking off—this is the point that the noble Baroness, Lady Meacher, made—the opportunity to come back to this. If we cannot persuade the coalition in the short term, either tonight or in regulations, that this is the right thing to do, which I believe it is, it would comfort me if the Minister were able to say that the Government do not believe that this is right because there are other ways of dealing with it. I would go to my bed this evening and rest slightly easier if he were able to say that it is still possible and we would not need to buy a new computer system if we wanted to do this in future.
“( ) After subsection (8)(b) there is inserted—
“(c) shall consider the extent to which a claimant falling under section 22 of the Welfare Reform Act 2012, and upon whom a sanction has been imposed under section 26 or 27 of that Act, had guaranteed and predictable access to childcare meeting the needs of any child for which the claimant was the responsible carer at the time when the decision appealed against was made.””
Baroness Lister of Burtersett
My Lords, in moving Amendment 62ZA, I shall speak also to Amendment 62B. These amendments focus on the issue of sanctions, in particular where a claimant with a dependent child faces sanctions because they are unable to access work or work-related activity or to sustain work due to a lack of suitable childcare which meets the needs of any child for which the claimant is a responsible carer. Amendment 62ZA seeks to ensure that the appeal tribunal takes into account the extent to which a claimant with a dependent child had access to appropriate childcare when the decision was made to impose a sanction under Sections 26 or 27. Amendment 62B also focuses on this issue and would guarantee that a claimant would not face sanctions and the loss of benefit where they are unable to access work or work-related activities or to sustain work due to a lack of appropriate childcare.
These amendments are supported by more than 40 very widely spread organisations. The recent child impact assessment statement from the Children's Commissioner for England stated that sanctions should never be imposed on the main carers of children under Clauses 26 and 27 of the Bill, unless accessible, affordable childcare was available that would allow them to take up offers of work or training or attend interviews. These amendments would meet the commissioner’s concerns. Providing such safeguards would be consistent with the approach taken in the 2009 welfare reform legislation where at Report, my noble friend Lord McKenzie of Luton confirmed in response to a similar amendment tabled by the noble Lord, Lord Kirkwood of Kirkhope, that the then UK Government would introduce regulations to provide that claimants with a dependent child would not face sanctions in these circumstances.
Most lone parents want to have the opportunity to combine paid work with the vital job of being a parent once their children are old enough, but the Welfare Reform Bill fails adequately to recognise the significant barriers to paid work which lone parents often experience, in particular the availability of appropriate childcare. In Committee, the Minister outlined the kind of safeguards which would be put in place to protect lone parents from sanctions where they are unable to access childcare. I will not reiterate them now. Unfortunately, I have a whole lot of examples which I cannot now read out because of the time constraints. However, in those examples it is clear that lone parents are being put under pressure to work hours which are not consistent with their childcare responsibilities. I believe that the organisations have written to the Minister and I am very happy to provide those examples outside these proceedings.
I know that the Minister will say that it is not appropriate to put in the Bill the safeguards being sought to ensure that no one is sanctioned because of lack of available childcare. I am sure that the House would be very grateful if he could therefore give a commitment on the record to bring forward regulations in the same way that my noble friend Lord McKenzie of Luton did to provide safeguards for lone parents who are doing a very important job raising their children. I beg to move.
Lord Kirkwood of Kirkhope
My Lords, I concur with the noble Baroness, Lady Lister.
Lord Freud
My Lords, I shall speak to Amendments 62ZA and 62B. I could almost do so like my noble friend Lord Kirkwood, but I will speak at slightly greater length.
I would like to assure noble Lords that we are in agreement on the need to ensure that a claimant’s childcare responsibilities are taken into account when setting work-related requirements and when determining whether a claimant has good reason for failing to meet a requirement. For the record, let me set out how we intend to do this.
The legislation will provide clear safeguards. When a child is under one, support will be unconditional. When a claimant’s child is under five, we will ask the claimant only to attend work-focused interviews. If claimants fail to meet this requirement for no good reason, they will be subject to the lowest level sanction; the sanctionable amount for these claimants will be limited to 40 per cent of the sanctionable amount for other claimants.
Secondly, advisers will take childcare responsibilities into account when setting work-related requirements, and we intend to set out some specific safeguards on this issue in regulations. Regulations will prescribe that claimants with a child under 13 will be able to limit their work search to jobs that fit around their children’s school hours. This is key. The best way to prevent the inappropriate application of sanctions is to ensure that requirements are reasonable in the first instance.
Amendment 62B seeks to introduce a blanket exemption from conditionality sanctions for claimants who can demonstrate that they did not have guaranteed and predictable access to suitable childcare. We do not think such a legislative exemption is needed. As I have previously explained, when a claimant fails to meet a requirement, a sanction will be imposed only if the claimant does not demonstrate that there was a good reason. In considering whether there is good reason, we will consider all relevant matters raised by the claimant, which could include the availability and cost of suitable childcare. This flexible, case-by-case approach is the right one, but to be absolutely clear, when a claimant demonstrates that a lack suitable childcare meant that the claimant was unable to meet a work-related requirement, a decision-maker should determine that the claimant has good reason and a sanction will not be applied.
Noble Lords have previously raised concerns about where the responsibilities lie in relation to the provision of good reason. I would like to take this opportunity to clarify the position. We have a responsibility to ensure that claimants understand the decision-making process and that they have an opportunity to explain the reason for a failure to meet a requirement. The onus is then on the claimant to tell us the reasons and provide supporting evidence where necessary. The department must then determine whether the reasons raised are relevant and whether any of those reasons constitute a good reason. The current practice of visiting ESA claimants with a mental health condition or learning disability before the application of a sanction is a good example of the proactive process required to collect evidence of good reason in some cases. I can assure noble Lords that we will review our approach to collecting evidence of good reason for all claimants to ensure that we get this process right.
The final safeguard is the appeals system. Any decision to reduce an award as a result of a sanction can be appealed to the First-tier Tribunal. Amendment 62ZA seeks to require the tribunal to consider whether the claimant had guaranteed and predictable access to childcare. We do not want to go down the route of prescribing specific matters to be taken into account by an independent body; the existing legislation is clear and sufficient. The First-tier Tribunal must consider any issue or circumstance raised by the claimant that is relevant to a valid appeal, so in an appeal against a decision to reduce an award of benefit because of a sanction where a claimant cites lack of suitable childcare as a good reason for failure, this should be considered by the tribunal because it is plainly relevant to whether the award ought to have been reduced.
Given the safeguards we have in place and the commitment I have made to reviewing our processes for collecting evidence for good reasons, I hope I have provided the assurances on the record that were required by the noble Baroness and I urge her to withdraw this amendment.
Baroness Lister of Burtersett
My Lords, I am very grateful to the Minister for his full response, given the lateness of the hour. I should have thanked One Parent Families Scotland for its help with this amendment. As this organisation has written to the Minister, if there is anything that it wishes to follow up, I wonder whether he would be willing to meet representatives of this and other organisations that have written to him just to go through in more detail what he has so kindly said to the House. I beg leave to withdraw the amendment.
Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
“( ) Where amounts are re-allocated to local authorities as described in subsection (5), the Secretary of State must publish the following information annually for five years following the first re-allocation—
(a) the amount of money which has been re-allocated from the Consolidated Fund in each local authority; and(b) an annual report accounting for the expenditure of these amounts in each local authority area.”
Baroness Lister of Burtersett
My Lords, like Amendment 50 debated last week, this amendment is designed to minimise the adverse effects likely to result from the abolition of the discretionary Social Fund—
Baroness Anelay of St Johns
My Lords, in order to be of assistance to the noble Baroness, who is seeking to move a very important amendment, may I suggest that those leaving the Chamber do not pass in front of speakers? That is not the habit of this House. May they please leave the Chamber by another route, so that we may hear from the noble Baroness?
Baroness Lister of Burtersett
Thank you.
The amendment is about accountability. Considerable concern was raised in Grand Committee about the accountability of local authorities for the moneys devolved to them when the discretionary Social Fund is abolished. The amendment has been drafted with the help of Family Action, to which I am grateful, so as to put into effect the recommendation of the Communities and Local Government Committee report Localisation issues in welfare reform. While the CLG Committee accepted the Government’s case against ring-fencing the money, its report said that this,
“may carry some risks at a time of difficult financial circumstances for councils”.
The committee therefore recommended that,
“central government identifies clearly the amounts that are being allocated to local authorities, and collects information about their use, until the new arrangements have bedded in—we suggest a period of five years. … This would provide some reassurance about the effectiveness of the new system in helping those in need”.
Ministers have been giving out mixed messages on this issue. I hope that means that they are genuinely trying to find a way of answering the concerns about lack of accountability that have been raised in a number of quarters. One ministerial response has been to rely on the ballot box, even though the people affected are those least likely to vote, and also to contend that it is sufficient to set out the purpose of the funding in a settlement letter.
However, a chink of light emerged in the Government’s response to the call for evidence, when they said that the settlement letter, mentioned last week by the Minister, the noble Lord, Lord De Mauley,
“may be supplemented with a requirement to report on how the funding has been used”.
The CLG Committee observed:
“This would fall some way short of the accountability mechanisms suggested by some stakeholders”.
Nevertheless, if the Minister now committed the Government to imposing such a requirement, we would be satisfied.
Last week, the noble Lord, Lord De Mauley, spoke about supplementing the planned review of a cross-section of local authorities in order to collect more information on how the money is spent. While I welcome the spirit in which this very small concession was offered, I fear that it falls short, not just of what we believe is necessary but of what the Government themselves hinted at in their response to the committee’s evidence.
We are still awaiting an answer to some astute questioning in Grand Committee from the noble Lord, Lord German, about how the Government will meet their obligations of stewardship for the money allocated to local authorities in England. As the noble Lord stated very powerfully, this is a question of accountability to Parliament. How can such accountability be ensured if local authorities are not required to report on how they spend the money allocated to them?
The purpose of Amendment 50ZB is to allay the fears voiced by voluntary organisations such as Family Action, Women’s Aid and Platform 51 that local authorities might impose a local or residence condition as a way of rationing assistance when allocating social housing. Again, I am grateful to Family Action for help with drafting this amendment. Given the pressures on local authorities, it is quite conceivable that some at least might seek to impose a local connection test—that is, confine help to people who already have a local connection with the area. In Committee, I tabled a general amendment to prevent such a test. This amendment is drafted more tightly to ensure that such a test is not applied to people fleeing domestic violence—or, more accurately, people who have fled domestic violence—young people leaving local authority care, people who are homeless or who have been homeless within the previous 12 months and people leaving institutional residential care such as a hospital, prison or a young offenders’ institution. In other words, this amendment is designed to safeguard the interests of groups who are likely not to have a local connection.
As the voluntary sector consortium headed by Family Action points out,
“These groups of people are much less likely than others to be able to demonstrate local connection. Without crucial assistance from a Community Care Grant to buy essential items such as cooking equipment and bedding, they may struggle to set up and maintain a home. This puts them at risk of reoffending or moving back into temporary or institutional accommodation, which is far more costly and means they lose their newly-found independence”.
The consortium is particularly concerned that, without a clear legal prohibition on requiring a local residence connection, women who have experienced domestic violence will be discouraged from moving elsewhere to flee their violent partner, or will return to their partner because they are unable to provide basic household items such as a cooker to prepare cheap healthy food for themselves and their children. The consortium’s concerns were echoed in the impact report published last week by the Office of the Children’s Commissioner for England, which looked at the impact of the legislation in relation to children’s rights. When questioned on this matter in the House of Commons, the Secretary of State assured Members that local authorities had a moral duty. Welcome as this recognition is, I fear that if a woman who has fled domestic violence or an ex-prisoner cites a moral duty to their local authority they will not get very far. Surely if the Government believe that a moral duty holds, they should translate it into a statutory duty.
The Minister, the noble Lord, Lord Freud, did not address these issues in Committee but kindly wrote to me afterwards. However, he simply set out in his letter the local connection provisions on homelessness contained in the Housing Act 1996. I shall not spell those out now, but they protect a person from being denied any assistance anywhere because of a lack of local connection. If the Minister is saying that the same rule will apply here, then I welcome it, but does it not need to be written into the legislation? As I understand it, the Housing Act 1996 does not apply to the legislation we are discussing here. If the Minister were to offer to bring forward his own amendment at Third Reading to give effect to the Housing Act provisions on local connection, I would happily withdraw the amendment as unnecessary. As an absolute minimum, can the Minister assure the House that the settlement letter will spell out that local authorities should follow the same provisions as in the housing legislation?
It seems to me that the aims of these two amendments are not that far from what the Government themselves wish to achieve. I hope therefore that the Minister might be willing either to accept them or to agree to bring forward his own amendments at Third Reading. I beg to move.
Lord De Mauley
My Lords, the local authority will not spend the money on a swimming pool.
Baroness Lister of Burtersett
My Lords, I thank all noble Lords who have contributed to the debate. They have added some powerful arguments and questioning. In response to the noble Lord, Lord Newton, I should say that it is better to go from zero to hero than the other way round.
I thank the Minister who, I feel, is inching gradually in the direction that we have been trying to push him. He has again reassured us that the Government share the concern across the House that the money that is allocated to local authorities should be used for the purposes intended. It was helpful to have more information about what will be in the settlement letter. However, I have heard nothing today to reassure me that the money will necessarily be spent on what is intended. We should think of the context. Local authorities are under huge pressure. Apart from anything else, they will have to be responsible for council tax benefit, with a cut of 10 per cent in the money available for it. How tempting it might be for them to say, “Oh, let us use a bit of the Social Fund money to top up council tax benefit”.
How can the noble Lord say with such assurance that the money will not be used on a swimming pool, a road or anything else? Without the information that this amendment would provide, I am afraid that the Government simply cannot give that assurance. I am very disappointed that the noble Lord has not felt able to go further in meeting the spirit of these amendments even if not the letter of them. I do not think that he has dealt adequately with the questions and comments made by noble Lords.
We have the example of the supporting people budget. When the ring-fence was removed, immediately many local authorities started spending the money on other things. That was with an existing budget. This is a new budget, which will be even more tempting for local authorities. I hope that the Government will reflect further on this issue. We will certainly reflect further but, for the moment, I beg leave to withdraw the amendment.
Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Patel
My Lords, I speak to my Amendment 45, which takes a much more radical view and proposes leaving out Clause 52. I guess the happiness will end now. However, I take note of the comments made by the noble Baroness, Lady Meacher, about the anxiety over abuses in the system, and I will listen carefully to the response from the Minister, because it is an important issue. I agree with the noble Baroness that it will not be worthwhile pressing any of the amendments if the Minister’s response is that there is a need to reconsider matters in the light of our comments.
I will outline the reason for my suggestion that we leave out Clause 52 by exploring historically why youth ESA was set up. Under the provisions, a person under the age of 20 who is not in full-time education or who has had a limited capability for work for 196 consecutive days can gain entitlement to contributory ESA despite not having reached the contributions threshold. This measure has existed in some form in the benefits system for nearly 40 years to enable young people to access contributory benefits if they are unable to work because of illness or disability.
The youth rules were introduced for incapacity benefit in April 2001 as a result of provisions in the Welfare Reform and Pensions Act 1999. They were intended to refocus benefits on people disabled early in life who had never had the opportunity to work and gain entitlement to incapacity benefit through the payment of contributions. The rules were carried over into ESA as part of the Welfare Reform Act 2007, again to ensure that young people who had not had the opportunity to build up a sufficient contribution record would not be excluded from the non-means-tested allowance.
With the Welfare Reform Bill the Government now intend to abolish the youth condition, as well as time-limiting its receipt to 12 months for existing claimants. The justification for this change, as set out in the impact assessment, is that it,
“will simplify the benefits system and ensure a consistency of treatment for those claiming ESA”.
This assessment completely fails to recognise that young people with long-term health conditions or disabilities are already in a place of disadvantage in comparison with older adults, hence the introduction of the youth condition in the first place, and that this change will entrench this disadvantage. This will mean that young people, including those unable to work because of cancer, will be extremely unlikely to be able to access the contributory element of ESA and will have recourse only to the means-tested income-related element to be subsumed into universal credit. Young people who are ineligible for the income-related component, which will include those with a partner who works more than 24 hours a week and full-time students, could therefore lose up to just under £100 a week. This will have a devastating impact on those who are unable to work and are struggling with the significant additional costs of a cancer diagnosis—and, believe me, there is a significant cost for all kinds of reasons once cancer is diagnosed.
The eligibility of young people for benefits is extremely dependent on their circumstances and particularly on their education status. I have serious concerns about how students, for example, are treated under the system. Full-time students are able to claim income-related ESA only if they are already in receipt of DLA. This is another example of how the eligibility rules at present disadvantage young people. I am also concerned about the knock-on effect of many young cancer patients who are students becoming ineligible for DLA as a result of the introduction of PIP—and we will discuss that later. I believe it is critical that the Government ensure that the eligibility of students with long-term health conditions and/or disabilities for ESA is not dependent on their receipt of DLA.
Let me give an example. David was diagnosed with stage 4 Hodgkin's lymphoma when he was 22. Before he was diagnosed, he received a full wage working for the NHS that stopped when he was undergoing treatment. As he had been working for his employer for only six months, he was entitled to three weeks’ paid sick leave. He was subsequently unable to claim any benefits, including ESA, because he was forced to move back home with his parents. David told me: “It can be really difficult for young people to build up time with one employer so that they are entitled to sick pay at full pay”. Similarly, it is extremely difficult for young people to build up national insurance contributions, so I am thankful that at present the youth rules enable young people, including those with cancer, to access contributory ESA, which can be a lifeline when they are already impacted by a loss of earnings.
DWP statistics show that 17 per cent of the current caseload of ESA claimants aged 16 to 24 are currently accessing contributions-based ESA, or both income and contributions-based ESA, and could therefore be negatively affected by this change. The DWP impact assessment estimates savings of only about £11 million per annum while noting that 70 per cent of those affected will lose £25 a week as a result of qualifying for income-related ESA only, which equals about £1,300 a year. A further 10 per cent will lose almost £100 a week by virtue of not qualifying for income-related ESA. Over a year, this amounts to almost £5,000. Only 20 per cent, or just under 3,000 claimants, will get exactly the same amount of income-related ESA that they would have got under the youth provisions. Based on the Government’s own estimates, this loss of income may affect as many as 10,000 people by 2015-16.
This means that only 20 per cent of claimants will be financially unaffected by these changes. I believe that it is wrong that these savings should be levied from such a small group of vulnerable young people. Indeed, the department’s own impact assessment notes that:
“The abolition of the ESA ‘Youth’ provisions is more likely to have an impact on disabled people because ESA is directly targeted at people with health conditions that limit their ability to work. There is a risk that the affected group will be more likely to need more support because of their condition than all ESA customers”.
I therefore believe it is wrong that the Government should seek to remove a vital form of financial support for young people with serious long-term health conditions. For a proposal that by the Government’s own admission will impact around 10,000 young people, the cumulative savings will be only £11 million.
In Committee, the Minister stated that he believes that his,
“proposals have built-in support for this group of claimants”.—[Official Report, 8/11/11; col. GC 58.]
I can assure the Minister that this is not the case and that his proposals will have a significant financial impact on young people with serious health conditions who may have no other option for financial support. For example, young people with cancer are not always able to access DLA, particularly if they have a treatment period of less than nine months. ESA may be their only option while they are undergoing treatment.
The Minister has also argued that no other group has this kind of concession in contributory benefits. However, that is exactly the point: the rules exist precisely because it is unlikely that young people will have been able to build up the requisite national insurance contributions, but they should still be able to access a benefit designed to provide financial support to those unable to work because of illness or disability. I do not see how this proposal can be part of a “principled approach to reform”, which is the basis for the whole of welfare reform.
The measure will remove a vital source of financial support for young people with serious health conditions and disabilities. I hope that the Minister will give some indication that he recognises this and that he is willing to look at it again or at least give it further thought. I take the point made by the noble Baroness, Lady Meacher, about the abuse of the system, which certainly needs to be addressed. When the time comes for me to decide whether to press my amendment, I will be mindful of that.
Baroness Lister of Burtersett
My Lords, I support Amendments 45 and 46, to which my name is attached. The purpose of the amendments has already been explained and the case has been made convincingly. I simply want to add to that. Young people who are disabled from birth or early in life have been entitled to claim ESA or its predecessors from the age of 16 since 1975, as the noble Lord, Lord Patel, pointed out. That has been accepted by all the main parties as a fair and proper way to treat young disabled people. Indeed, my noble friend Lord McKenzie did not thank me for reminding the Grand Committee that in a previous Parliament he was urged to be more generous to this group of young people by the then Opposition spokesperson, the noble Lord, Lord Skelmersdale. I was therefore rather surprised when the Minister argued in Grand Committee that no other age group can qualify for contributory ESA without having paid, or been treated as having paid, national insurance contributions. That is because all other age groups will have had the opportunity to earn such contributions, as the noble Baroness, Lady Meacher, and the noble Lord, Lord Patel, have already pointed out.
We are talking about a very small group. According to the Government’s figures, about 15,000 young people are likely to be affected each year. Some of these will qualify for income-related ESA, although sometimes at a lower rate, when there will be an estimated average loss of £25 a week, which is a significant sum for those on a low income. They may become automatically eligible for passported benefits such as free prescriptions, depending on the outcome of the review currently being undertaken by the Social Security Advisory Committee, but that does not justify removing their underlying entitlement to a weekly income. One in 10—or 1,500 a year—will lose all entitlement to benefit, perhaps because they have a partner in full-time work or because of the capital rules.
Lord Freud
To be absolutely honest, unwinding the effects of the first full year, which will be in 2017, is quite hard to do in simplistic terms when compared to an SR. The simple answer is that the £4 billion is a real £4 billion, not an eroded £4 billion. The impact assessment makes it clear that it is made up of roughly half and half efficiency; it is a much more efficient system. We have taken the efficiencies that we have gained and put them back into the pockets of people, plus an extra amount of £2 billion. That is where the money is coming from. The bulk of it is going into the lowest two quintiles in a rather efficient way; I forget whether it is 80 per cent or 90 per cent, but the bulk of that money is directed very efficiently.
I turn to Amendment 45 in the names of the noble Lord, Lord Patel, and the noble Baronesses, Lady Lister and Lady Finlay. Clearly, the design of that amendment removes Clause 52 altogether. As I have just mentioned in my remarks on Amendment 45A, we have a principled approach to reform, in which we are trying to modernise and simplify the current welfare system and remove duplicate provision when our resources are limited.
As we move towards universal credit, on which I have just spent a bit of time, there are other areas of rebalancing the relationship between the state and individuals. I remind noble Lords again that the small number of youngsters who do not qualify for income-related ESA are in this position only because they have alternative resources available to them. All those in the ESA support group will continue to receive unlimited support. We will also, of course, provide support to ESA youth claimants whose awards end, and they later become vulnerable through their conditions deteriorating so they develop limited capability for work-related activity.
Baroness Lister of Burtersett
Does the Minister accept that there may be resources available to that group but that they are not resources over which they would have control, as they do not provide those young people with any form of independence, as does the contributory ESA?
Lord Freud
My Lords, where they have other resources, as they move into young adulthood, clearly they have to be resources of their households at that stage and their own capital and household income. The reality is that very many of this small group of youngsters are inheriting very substantial sums of money; that is why they are in the position that they are in. That is a decision in principle over whether we should support people who have very adequate resources of their own. We will continue to support those who have deteriorating conditions even when they have a high income. They just go back into the support group.
Let me just go into the rather complicated position with European law and the specific judgment here, which I am looking at. I do not know whether the noble Lord, Lord McKenzie, will regard it as recent enough—this is the Lucy Stewart case on 21 July last year. It is within half a year, so I think that is recent. We have a code for soon and sooner or whatever; recent is within half a year. That judgment made it clear that we cannot use the past/present test to deny access to a benefit if a claimant demonstrates a genuine link to the UK in other ways, which may include consideration of the relationship of a claimant and the social security system of the competent member state or claimants’ family circumstances. The past/present test requires that a claimant must be present in Great Britain for 26 weeks out of the last 52 preceding a claim for employment and support allowance. We still lost the case, even though we had lots of powers on residence. Clearly, the view of this Government is that it should be a matter for the Government of this country to decide how people qualify for benefits. The effect of this judgment is that young people can qualify for a benefit even when they have not lived in this country for many years.
I cannot be absolutely hard and fast on the European benefit-shopping issue; I can tell your Lordships only that this is causing us enormous concern at a number of levels and we are currently challenging Commission lawyers on it. The issue, at the simplest level, is that if you can call something social support it is much less likely to be abused and taken abroad than if it is a contributory right. That is where the battleground is and your Lordships can clearly see what we are doing here. When we are asked for a concession and whether we can get round the European law, what we are looking at is a system that basically provides the support for the vast bulk of the youngsters whom we want to support without opening our doors wide to current and future dangers of this kind of benefit exportability. That is the approach that we have adopted to try to get round this problem.
Lord Freud
My Lords, I do not think that we ought to spend a huge amount of time on this—it is really difficult and moving very fast. The principle is that it is the automatic entitlement that makes us vulnerable. If it is for income supplement and social support, it protects us. Your Lordships can see that the change that we have made here is to cover the vast bulk of the youngsters with support, but it is not automatic. That is precisely the safety that we are going into with this European legislation. I do not think that the precise workaround from the noble Baroness, Lady Hollis, works or that we should sit round this Chamber and work something out. All I can tell your Lordships, for your consideration, is that this is the way that we have found to get round it while, as I say, covering 90 per cent of those youngsters.
I ought to hurry along, but let me move to giving your Lordships the figures on Amendment 45. The reduction in the cumulative benefits savings by 2016-17, over five years, would be around £70 million, which we would need to find elsewhere. A little bit here and a little bit there—it is a very hard thing finding bits of money.
Baroness Lister of Burtersett
I am sorry to interrupt again but in Grand Committee the cumulative saving during that period was £10 million. Now, suddenly, it is £70 million. Where has the other £60 million been accumulated?
Baroness Lister of Burtersett
My Lords, I want to make a very brief point in support of the amendments. The Government say that time-limiting ESA is not based on an estimate of a typical recovery time—it is not evidence-based—but on the principle that these are people who have other means of financial support, which of course is exactly the same principle that the Minister raised earlier to justify removing the ESA youth condition.
This other support is of course income-related ESA, and the Government point out that 60 per cent of people affected will be able to claim it. That means that 40 per cent of those affected—roughly one-third of men and nearly half of women—will not be able to. We are talking here about an erosion of their financial autonomy. Many noble Lords have received many letters from people saying that they are shocked and anxious at the implications of this.
An article in today’s Guardian summed up very well what this erosion of financial autonomy means. This quotation is from a man who is going to be affected by this:
“The satisfaction of being able to contribute to the family budget with a benefit that has been earned and paid for will be removed. The last shred of dignity will be stripped from people who have already lost a great deal in life and who may already feel a burden on those who care for them”.
Disabled people should never feel that they are a burden on those who care for them, and it is terrible that they are being made to feel that way by this clause.
Baroness Hollis of Heigham
I shall be very brief and respond, if I may, to the noble Baroness, Lady Thomas of Winchester, who over the years has been a doughty champion for disabled people. However, I have never before heard her make a speech based on the sole proposition that because the House of Commons might reject an amendment, it should not be moved in this House. That is not a sound base for policy, as the noble Baroness will accept. That does not mean to say that at Third Reading there may not be compromise or fallback amendments and so on, but this House has never walked away from its proper duty to scrutinise because it feels that the other place may not accept what we are doing. I hope that the noble Baroness will not run up that sort of argument again.
Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Lister of Burtersett
My Lords, in Grand Committee the question of the assessment period got a bit lost because there were so many issues that the Minister had to deal with. I asked the Minister why the assessment period was not included but never got an answer.
We talk about the time limit kicking in after a year but it is a year minus 13 weeks because for those first 13 weeks people affected will be paid at JSA rate, which is lower. Quite a number of us were confused, but the upshot was that the Minister said:
“I have to admit that I am not particularly happy about the assessment phase of ESA and how it is working … I would like to look at it. It is difficult to have a set of principles around something that one is somewhat unhappy about”.—[Official Report, 8/11/11; col. GC 46.]
I hope that the Minister has looked at it in the interim and has perhaps realised that there is no principled reason for the clause as it now stands and there is every principled reason for supporting the amendment. I hope that the Minister will see reason and it will not be necessary to test the opinion of the House in the way that the noble Lord, Lord Kirkwood of Kirkhope, was suggesting.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)
My Lords, I shall leap straight in on the issue raised by the noble Baroness, Lady Lister, on the assessment phase. What I was really alluding to was the upcoming sickness absence review, which is an important review of how we treat sickness absence. One of the things it has looked at is the interrelationship between sickness absence periods and the ESA regime. Basically the review sees no real reason for the assessment phase. As we look at this we must ask: are we structuring ESA and sickness absence so that it is a vulnerable or difficult process? I am sympathetic to my noble friend when he says that there might be a way through this. I want noble Lords to be aware that huge weaknesses have been found. We are pushing people through a process that puts them in limbo for a long period of 92 days or more. The sickness absence review states that that is deeply unsatisfactory, and I suspect that a lot of noble Lords in this Chamber who understand the system also believe that. In that area, I am not sure that this is genuinely the direction in which I want to go because I am not sure that it is something we want to maintain.
Moving on from that, let me set out some of the technicalities of the assessment phase. It usually ends after 13 weeks unless by that point there has not yet been a WCA determination. If a WCA has not been carried out by the 14th week, the assessment phase ends when a determination about limited capability for work has been made. So if the claimant’s assessment phase lasts longer than 13 weeks and they are found to have limited capability for work or work-related activity, the payment of additional components is then backdated. That is the existing system, which I am not that happy with. The effect would be to exclude it in terms of counting to the 365 days, or at least the 730 days depending on where we are, but in practice it does not always happen within 13 weeks and we have a lot of disparity of treatment. Even if we were to stay with the regime, it would be a pretty messy system.
I know that noble Lords hate me when I go through figures, but let me give some—I shall do my best because these figures have been running around. Purely on this basis, there is a cost of an extra £430 million cumulative to 2016-17 over the five-year period. I shall try to make a quick off-the-cuff assessment of how much extra it is when we look at it on top of the two years, and it is not actually a hugely different sum. It is £200 million on the SR period and £400 million on the total period of five years. I know that noble Lords feel that hundreds of millions are easily obtainable, but it is not an insignificant amount of money.
Moving on to Amendment 40B, the effect of this amendment would be that for existing ESA claimants, the one-year time limit would be calculated from the date the clause is commenced, and none of the time already spent on ESA would count towards the 365-day total entitlement. I want to have a word about retrospection. The noble Lord, Lord McKenzie, used the word slightly freely and in fact slightly aggressively. I was upset but not ashamed. I can understand that noble Lords are unhappy that we are taking account of days before the clause is brought into account, but this is about the question of whether noble Lords feel that this is the right approach; it is not about retrospection. Retrospection involves interfering with a claimant’s past entitlement and we are not doing that with this measure.
It is worth explaining what retrospection of time limiting would involve if we were to do it, which we will not. It would involve interfering with past entitlement to ESA. An example would be: at the date we commence the time-limiting provisions, if a claimant who had been receiving contributory ESA in the WRAG for 18 months, it would be retrospective if we demanded repayment of the extra six months of benefit he had already received because that would interfere with the claimant’s past entitlement. We absolutely are not doing anything which is retrospective in that sense. We are redefining the terms on which claimants are entitled to ESA in the future.
Lord Freud
My Lords, I do not want to reopen this matter at Third Reading on the basis of things that I will have no further information on at all. That does not make much sense. The noble Lord is absolutely right that if we were to get rid of the assessment phase—and clearly that is something on which, as those who know how government works will know, we would have to do some work—it would be a big change. It would tie in with a lot of other changes, with work that we are going to be doing this year. We are utterly committed to this sickness absence review, which has been a very important document for us. My noble friend said that there was some value in using this assessment phase in this way in the future. I am trying to say that I do not think there is, because I would not want to put any weight on it. There might be other things that we can do to get out of a hole—if we are in a hole—but I honestly do not think that this is a promising line. I do not want to have this debate again at Third Reading. I have said everything I can on it, but I hope that I have said enough.
Baroness Lister of Burtersett
I apologise, but I wonder whether the Minister could say one more thing now so that we do not have to come back to it at Third Reading. If the assessment phase is done away with, clearly there is no issue. Given that the Minister himself is clearly suggesting that he would like to see that, would it be possible for him then to say whether, in the event that the assessment phase is not abolished, he would accept the spirit of this amendment now?
Lord Freud
I am clearly not in a position, and it would take more than a couple of weeks to get into a position, to make that kind of assurance. I know how skilfully your Lordships ask me these questions, and I deeply appreciate it, but I cannot do that. All I can tell the noble Baroness is that we have had a very powerful report on sickness absence, which I am personally very closely associated with and have sponsored. It made this recommendation, and most people in this Chamber who understand these matters would say that that is the way to go—as I would. Noble Lords must take their conclusions from that, but I cannot go much further or make promises on hypotheticals, because that is not how the system works.
“Condition relating to youth
In paragraph 4 of Schedule 1 to the Welfare Reform Act 2007 (condition relating to youth), after sub-paragraph (1)(d) insert—“(e) after the assessment phase has ended, the claimant has limited capacity for work-related activity.””
Baroness Lister of Burtersett
My Lords, I hope that this debate will be a bit more straightforward than what we have just been discussing. The amendment aims to protect the ultimate safety net in our social security system by ring-fencing the money devoted to it when responsibility is devolved to local authorities without any statutory duties attached.
Clause 69 abolishes the discretionary Social Fund, described by Barnardo’s as a lifeline for some of the poorest and most marginalised people in our society. Together with Family Action, to which I am indebted for its assistance, it is among many voluntary organisations looking to your Lordships' House to safeguard that lifeline. Indeed, 20 have this week written an open letter to the Minister. This is not the place to make the case against the abolition of the discretionary Social Fund; we rehearsed that in Grand Committee. Instead, it is up to us to ensure that when the discretionary Social Fund is abolished, the money allocated to local authorities and the devolved Administrations is used for the purpose intended.
The Social Fund was introduced in the late 1980s in place of a system of statutory payments to help some of the poorest members of society with one-off needs. At that time, the noble Lord, Lord Kirkwood of Kirkhope, and I were ranged against the noble Lord, Lord Newton of Braintree, who unfortunately cannot be with us this evening for health reasons. Today, we are trying to salvage something from the forthcoming wreckage of what we now acknowledge that the noble Lord, Lord Newton, achieved—one of life's ironies.
Through a system of community care grants and crisis loans, the discretionary Social Fund provides vital cash assistance to some of the most vulnerable members of the community. CCGs help people on out-of-work benefits to remain in or set up their own home, to retain their independence. We are talking, for instance, about young people leaving a children's home or foster care, people with chronic health conditions or disabilities who need aids and adaptations to allow them to live in the community—about one-third of recipients are estimated to be disabled—and women who have fled domestic violence. As one such woman said:
“The community care grant meant such a lot. I had been in a refuge. I had very few possessions as I had to leave them all behind ...The CCG helped me make my flat into a home”.
Crisis loans are interest-free loans payable where there is an immediate threat to health or safety—for instance fares when a child has to be taken to hospital or money to cover the cost of replacements following a flood or fire.
We accept that the discretionary Social Fund needs reform, but this is not reform, it is abolition with no guarantee that local authorities will pick up the pieces using the money allocated to them. The aim of the amendment is to write into the Bill just such a guarantee and thereby achieve the Government's aim of protecting the most vulnerable.
Experience suggests that without some form of statutory ring-fencing, there is no way to ensure that the money allocated to local authorities and devolved Administrations will be spent in the way that the Government and Parliament intend. That is not a criticism of local authorities but simple realism. Local authorities are already hard-pressed to meet all their statutory functions in the face of budget cuts. This pot of money could be very tempting.
In Grand Committee, the noble Lord, Lord Brooke of Sutton Mandeville, held us spellbound with a cautionary tale of what happened when he was a junior Minister of higher education, and money intended for Liverpool Polytechnic was purloined by Liverpool council for housing. It clearly impressed the Minister. More recent experience is that of Supporting People—a fund designed to help vulnerable groups. Since the ring-fence was removed from that, overall spending on Supporting People has been cut by more than 10 percentage points more than the settlement received by local authorities for the purpose. That is an existing budget; the pressure to cut a wholly new budget will surely be greater.
We should listen to what local authorities themselves have to say. Recently published DWP research with authorities addressed this issue. While admittedly some authorities were unenthusiastic about ring-fencing—perhaps seeing tying their hands in that way as being like turkeys voting for Christmas—a number were,
“concerned that without a ringfence ... funding would quickly become amalgamated into existing budgets and as a result its identity, visibility and purpose would be lost. A second concern was that Councillors or Directorate heads would redirect the funding to plug gaps in other budgets”.
It is just such fears that this amendment is designed to allay.
Both the present and previous Social Fund Commissioners have expressed similar anxieties. What will happen to the woman who has fled domestic violence and who needs to turn a house into a home for her family, or the disabled person anxious to remain in her home but without the means to do so, or the ex-prisoner who needs to set up home? The potential consequences have been spelt out by organisations such as Citizens Advice and Family Action: greater reliance on overstretched charities, on food banks and on high-cost lenders, as the Joint Committee on Human Rights also warned in its report on the Bill, or simply going without, with a potential risk to health or safety.
A child rights impact assessment of the Bill, just published by the office of the Children’s Commissioner, suggests that such consequences mean that the clauses in the Bill abolishing the Social Fund could be in breach of the UN Convention on the Rights of the Child on a number of counts. Can the Minister—wherever he is—please tell the House what account has been taken of the convention and what the Government’s response is to this advice? I am sure that your Lordships’ House would not want to agree to a breach of obligations under the convention.
The case for ring-fencing was made from all Benches in Grand Committee. In response, the Minister acknowledged the strength of feeling and indeed accepted the spirit of the amendment when he said:
“It is quite clear that we need to make sure, if we are putting money out for vulnerable people, that it goes to vulnerable people and is not diverted elsewhere”.—[Official Report, 10/11/11; col. GC 140.]
I could not have put it better myself.
On the other hand, he argued against ring-fencing. He contended that ring-fencing would restrict innovative thinking and limit local authorities’ ability to devise schemes that best address the specific needs in their respective areas. However, ring-fencing does not prevent innovative schemes; it simply prevents local authorities using the money for some other purpose entirely.
The Minister promised to reflect on the arguments put in Committee. I am sure that all noble Lords will be delighted if he has come up with a solution to the dilemma in which he found himself—that of accepting the spirit of ring-fencing but not the legislative means of achieving it. If your Lordships’ House should pass this amendment, it would not cost the Government an additional penny, which should be music to the ears of the government Benches. On the contrary, it would help to ensure that the money voted by Parliament was spent on safeguarding the health and well-being of the vulnerable people for whom it was intended. I beg to move.
Baroness Turner of Camden
My Lords, I support the amendment. When I first read the Bill, it had been my intention to put down an amendment to try to remove the clauses dealing with the Social Fund. Clauses 69 to 72 outline the abolition of the discretionary Social Fund, including community care grants and crisis loans. As we have heard from my noble friend Lady Lister, the Government expect these responsibilities to be undertaken by local authorities.
We are dealing here with quite desperate people. The funds provide assistance for people at the very end of their tether. They have no one to turn to and nowhere else to go. The problem is that local authorities are now under considerable pressure themselves. They are having to economise and there is no guarantee that the very poor people for whom the funds provided some form of immediate support will figure very high in the list of requirements so far as local authorities are concerned.
I did not process my amendment earlier but my fears are very well met in the amendment now before the House. As my noble friend indicated, it provides for ring-fencing to ensure that a local authority makes provision for the people already provided for by the Social Fund arrangements. There are many instances, as we are aware, of women facing domestic violence, which is rather horrifying. Much of it takes place within families, sometimes within immigrant families, and the women have absolutely nowhere to go. Some of the violence is unbelievably cruel and sometimes it surfaces in cases that eventually reach the courts. We have an obligation to ensure that people in such desperation have somewhere to turn.
There are other levels of deprivation and concern that have already been referred to, involving children, homeless people and those who have just been released from institutional care. They are people who have nowhere else to go and we have to provide that support for them. I very much hope that the Government will be persuaded to accept this amendment.
Lord De Mauley
Historically it has been AME. The funding for the year 2012-13 will be the funding that is transferred in 2013-14. It will not increase by that amount. However, there are the budgeting loans to which I have referred as well.
The noble Baroness, Lady Hayter, raised a question over benefits. Short-term advances will replace crisis loans for alignment as part of a national payments on account scheme. These advances of benefit will cover those in financial need as a result of waiting for an increase in benefit or for a benefit claim to be dealt with.
On the question asked by the noble Baroness, Lady Sherlock, the policy is developed taking account of all relevant rights. We did not take specific legal advice.
I hope that what I have said will enable the noble Baroness to withdraw her amendment.
Baroness Lister of Burtersett
I am very grateful to all noble Lords who spoke in support of the amendment, in particular the noble Lord, Lord Blair, who waited patiently all day and has shown his commitment to the importance of this amendment in doing so. The noble Lord, Lord Kirkwood, is ever a supporter on the side of righteousness and rightly said that ring-fencing is the very least that noble Lords should expect.
I am grateful to the Minister for the spirit in which he responded to the amendment. It was very much the spirit in Grand Committee by the end—the recognition that we must ensure that the money is spent. As my noble friend Lady Sherlock said, it is not just on the people for whom it is intended but for the purpose for which it is intended. I am afraid that I am personally not convinced that a settlement letter is sufficient to ensure that. We have made some progress but not nearly enough. The Minister then half-answered the question that I was going to asked on how the Government would check that the settlement letter was followed. I think that he said that there would be a review in 2014-15 of a cross-section of local authorities. Perhaps I may suggest that perhaps he would like to consider Amendment 50ZA before we come back, as it would go further than that and require local authorities to report on how they use the money, because that is the only way in which to be sure that the settlement letter is adhered to.
I am afraid that I am not terribly convinced by the Minister’s response to the question asked by my noble friend Lady Sherlock about the UN convention on children’s rights. If the Government have not taken legal advice—and I believe that the Children’s Commissioner’s report is only just published—I would want to know specifically what the Government’s response is to that report and to what the Children’s Commissioner says. We have not heard that response tonight. However, I am aware that it is very late and it is not the time to test the opinion of the House, even though not one noble Lord has spoken in support of the Government and all noble Lords have spoken in support of the amendment. Nevertheless, I beg leave to withdraw the amendment.
Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 11 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Meacher
My Lords, I support Amendment 19. I have particular concerns. I fully endorse the point made by the noble Baroness, Lady Hollis, that when people lose their job it is unacceptable for them immediately to face not only the shock of being unemployed and the dramatic fall in their incomes but the prospect of having to move their home. Psychologists always say that it is important to avoid changing more than one of our three mainstays of security in any one year: employment, our main relationship and our home. The risks of mental health problems rise significantly if we do so, as the noble Baroness illustrated very well.
There is therefore a strong case for allowing newly unemployed people time to adjust before they have to think of moving home. Of course the hope would be that they would find work within that year and never have to move at all. I want to raise again a particular problem that to some degree would be assisted by the amendment. I raised this issue in my most helpful meeting with the Minister but have reason to believe that his assurances would not work as he thinks they would. The issue is that of people with severe mental health problems who may be absolutely unable to move into shared accommodation, either because they themselves could not handle having someone else around or because the situation would be untenable if not downright dangerous for anyone else trying to live with them. The Minister assured me that discretionary housing payments should deal with this problem. Perhaps in theory this might be the case, but apparently in practice it does not in fact work. Does the Minister regard it as right for sick people to be penalised when for therapeutic reasons they cannot move into a living space with someone else?
I have a couple of examples to illustrate the point. A woman in her early 30s, living alone in private rented accommodation, receives ESA because of her mental health condition. She already has rent arrears as her housing benefit does not cover her rent. She applied for a discretionary housing payment but this has been refused. She has now been told that her housing benefit will be cut further, of course, in January 2012, when she is only entitled to the shared accommodation rate. She finds it difficult to cope with other people, and could not cope with a shared flat, even if she could find one. The adviser who is dealing with her fears that she could become homeless.
The other example is of a woman in her early thirties with HIV and related health difficulties, including depression. She is regarded as being unlikely to receive a discretionary housing payment until she is 35. I do not know why, but that is what I am told. She comes from a traumatic background, needs regular access to her many medications, and to the bathroom. She is not regarded as someone who could cope with shared accommodation: again, a likely homeless person.
If these claimants finish up on the streets, they will no doubt end up on one of our hospital wards at a cost of £261 per day, £95,000 per year to the taxpayer. I realise that this is a cost to the Department of Health, and not to the DWP, but I know the Minister is broad-minded on such matters and will not want to cause a massive increase in Department of Health costs. I am serious about it. There might be a saving to the DWP, but a much bigger cost in the Department of Health. However, the noble Baroness, Lady Hollis, does not accept at all that there would even be a cost saving in the DWP. There would therefore be a double whammy. We already see people moving automatically from benefits, to losing benefits, then on to the streets, and then into hospital. That is the way the system works, and this measure will simply make matters worse.
Apart from the inappropriateness of shared accommodation for some, though not at all every mentally ill person, there is also the practicality of finding such accommodation for this particular group. Someone with a mental health problem is going to be the last person many people want to share with. We know that the stigma involved is considerable. People are frightened, and they assume that people are dangerous when in fact they are not at all. But also, in reality, some people have difficult personal assumptions which would make them quite difficult to live with.
The result is that these people will not find shared accommodation readily, even if they could cope with it, and many absolutely could not. I know many people on our wards whom we could not discharge into shared accommodation. They would simply sit around on the wards, and it would be a problem.
I have focused on a particular claimant group, but an important one, in view of the numbers of these people. I hope the Minister will be sympathetic to the amendment, for all the reasons the noble Baroness, Lady Hollis, pointed out, but also because it would ameliorate the problem of this particular group of people with mental health problems who, with any luck, might over a year settle down rather further and then might be able to be accommodated within the system.
Baroness Lister of Burtersett
My Lords, I support the amendment tabled by my noble friend Lady Hollis of Heigham. She has painted a vivid and powerful picture of what this means for the people affected. I have sat through and participated in a couple of debates already about this, partly on the regulations, in Grand Committee. The more I have listened and read the evidence, the more uncomfortable I feel about us allowing this measure to go ahead.
When I was younger, I flat-shared. I answered the ads in Time Out, and it is a very different thing. I am sure that many noble Lords may have been in that position, and think there is nothing wrong in sharing accommodation. But doing it from choice is very different from being pushed into it. As my noble friend has spelt out, we are talking about less salubrious accommodation.
I am concerned about various groups who are particularly vulnerable here, as we have already heard. When the Social Security Advisory Committee considered this, it talked in particular about the way women will be affected. Women are not disproportionately affected as a group, but those who will be affected could be particularly adversely so.
There are two groups in particular. Pregnant single women, the advisory committee said, will be restricted to the shared accommodation rate until they give birth. They face one of three undesirable situations. They can move home twice, at a time when they may be financially, emotionally and physically ill-equipped to do so, into shared accommodation, and then back to self-contained accommodation when the baby is born; they can decide to move into shared accommodation and remain there after the birth of their child; or they can try to make up the shortfall in their rent.
Baroness Hollis of Heigham
My Lords, I would prefer housing benefit to be part of UC and to be paid to the tenant, because I think that that strengthens UC and makes it easier for one simple calculation to be made for the family. However, I support the amendment because, until the Government have rock-solid arrangements in place to ensure that the rent element in UC is immediately paid to the landlord, both tenant and landlord will, as the noble Lord, Lord Best, said, suffer.
Why would the tenant suffer? He may have to pay transaction costs. If it is looped through his bank account and there are any outstanding overdrafts, debts, or whatever, his UC, including the housing element, will be top-sliced. That is when there is no temptation to spend it on other things. I checked with my housing association. Even with direct debits from tenants in work, those direct debits go astray—deliberately or otherwise—and intensive work has to be done in housing management to reconstruct them again. Tenants can risk losing their home if rent payments are not made automatically to their landlord. For some tenants, that will be a real struggle. If tenants wish to have their rent paid directly to their landlord, but that choice is being denied them, they will suffer.
Why will the landlord suffer? Arrears will undoubtedly arise. I have doubled the amount in my housing association accounts because of potential arrears that I suspect will follow from this change, as have other housing associations. We will then also have to increase staff resources to try to collect those arrears. Private landlords, already reluctant to take DWP tenants, will certainly refuse. One reason for extending direct payments in the first place was to make it a more attractive option for landlords in the private sector, who have been notoriously reluctant since the 1950s to make accommodation available. They used to say, “No Irish, no blacks, no DSS, no dogs”. Versions of that scrutiny, that winnowing out, I fear regrettably still apply.
Ultimately, landlords may need to face evicting tenants. As many of those who cannot manage their money will be vulnerable, they may or may not be regarded as intentionally homeless. If they have children, they are a real problem for all parties, including social services.
Furthermore, housing associations, including mine, are seeking to raise money from private sources, from banks—even, we hope, from pension funds, which is under negotiation at the moment—for building programmes. Our asset is the security of our rent roll. If tenants instead have money paid to them which is not rock-solidly paid immediately to the housing association or the local authority, that rock-solid asset base will no longer be as valued. We estimate that the proposal will cost us something like 50 base points extra on all the loans we raise. We become a worse risk and, as a result, fewer homes will be built. An amendment putting the decision in the hands of not the DWP or landlords but in the hands of tenants is surely the right way forward.
Baroness Lister of Burtersett
My Lords, I shall speak briefly in support of the amendment moved by the noble Lord, Lord Best, from a slightly different perspective, and repeat what I said in Grand Committee. In Grand Committee, I congratulated the Government on their research, Perceptions on Welfare Reform and Universal Credit, which sounded out various stakeholders about what they thought about some of the reforms. One thing that came from that from people who will be affected was that although they welcomed the one-stop shop approach of universal credit—to the extent that it is a one-stop shop—there were real fears about putting all the eggs in one basket. If all the money goes together in one lump sum, if anything goes wrong, people are left insecure—high and dry. If some of the rent payment is going to the landlord, where the tenant wishes it, that is mitigated. That is why that choice should remain
Not expressed in this research but by a number of outside organisations is the worry about what happens to the money in the family. I know that the Minister argues that budgeting accounts will sort this out. I hope that they will, but I think that he knows that I am still slightly sceptical about the magical powers of the budgetary accounts. There are fears that the money may not be paid into the account of the person responsible for paying the rent and that they may not then have control over how the money is spent by their partner. That is a slightly different perspective from that of the noble Lord, Lord Best, who understandably and powerfully is relaying some of the concerns about housing providers, but we have to think about the extra burden that this might be placing on some families.
Lord Cormack
My Lords, the noble Lord, Lord Best, has made a powerful case. He made it very gently but forcefully. I was also struck by what the noble Baroness, Lady Howe of Idlicote, said. As one who held MPs’ surgeries for about 40 years and saw people come in who were often in considerable distress, I know that it is not just the feckless who get into financial trouble. Many decent people get into financial trouble. The ability to say that this money should go direct to the landlord could be of enormous help to someone who suddenly has a sick child and feels that they must spend the money on that child. If the money has gone to the landlord, the landlord is secure and the tenant is secure. That must surely be wholly desirable.
Those of us who have been constituency Members of Parliament know how difficult it is to persuade private landlords to consider tenants in this general category. We need an abundant supply of privately rented accommodation. Anything that may detract from that is to be regretted.
I admire my noble friend, because he is thoroughly the master of his brief and because his underlying aim, which is to create a more responsible society, is one to which we can, surely, all subscribe, but there are exceptions and times when it is right to give a choice.
Another point, which the noble Baroness, Lady Howe of Idlicote, made, struck a chord with me. There are many elderly people in receipt of benefit who get confused. I am not talking about people who suffer from dementia, but we all know—the noble Lord, Lord McAvoy, knows from his constituency experience—that elderly people sometimes get confused. They think, very genuinely, that they have paid something when they have not. It would be a great blessing to give those people that choice.
I would urge my noble friend the Minister to give very careful thought to this. I hope that the House will not divide on it tonight, but I hope that he will be able to give some thought perhaps even to putting down an appropriate amendment at Third Reading.
Welfare Reform Bill
Baroness Lister of Burtersett Excerpts(12 years, 11 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Lister of Burtersett
We are very pleased to hear that. Can the noble Lord tell us what definition of domestic violence the Government have in mind? They are consulting at present on the question of domestic violence and I wonder what the implications are for this provision.
Lord Freud
I am going to have to write with a precise definition of domestic violence and the threat of domestic violence.
Turning to Amendment 26, we are all too well aware that in-work conditionality is a difficult and contentious area. In this debate and in Committee noble Lords raised a number of concerns and questions. I think that I have been open enough to admit that I do not have all of the answers to those questions right now, but I hope that I can provide some real reassurance by describing our planned approach. We are going to take some time to get this right, because it is a new area. I said in Committee that there may be a role for piloting and I can now be much clearer on that.
We have decided that when universal credit is launched we will not be imposing conditionality on claimants with income or earnings which would, broadly speaking, have taken them over the cut-off point for the current out-of-work benefits. So we are effectively continuing with the current system. Rather than a review, our approach will be to pilot the application of conditionality on claimants whose income is above this level. We will want to gather views on the sort of approaches that could be tested and I commit to publishing the details of these pilots. We will then reflect on the results of that process before adopting any national approach.
Finally, turning to Amendment 24A, I have listened very carefully to the feelings of noble Lords on this and again let me say that we are of one mind on this matter. Work is already under way, as I said in Committee, around how kinship carers should be treated for conditionality purposes. I agree that kinship carers who need a period of adjustment should be given time to return to a stable footing before being expected to meet work-related requirements and juggle conditionality with new caring responsibilities. Advisers will have discretion to lift temporarily the requirements on individual claimants where a child’s needs are such that the claimant must be able to provide full-time care. I repeat what I said in Committee. I recognise the potential for value and clarity in a legislative exemption from conditionality and we are carefully considering options for further provisions. The Bill provides scope for flexibility in this area and we have powers to make regulations as necessary. These things take time, but I can assure noble Lords that work is progressing. I am on this case. We are currently talking to the Department for Education—
Lord Freud
No, my Lords, the sanction regime does not work like that. It takes away the equivalent amount of the JSA, so you keep getting your housing credit, but have this amount taken off, which will be a proportion of the total universal credit.
Baroness Lister of Burtersett
I am sorry to interrupt the Minister, but is he saying that the department is unable to measure compliance with work-seeking requirements? If that is the case, surely the whole basis of the sanction regime falls apart?
Lord Freud
I think I can safely say that we are not saying that. We are just saying that we want real proof of a change. The prodigal son must do more than turn up and warm his hands on the fire as the fatted calf is slaughtered. I am saying that he has to take a job and hold it for a minimum of six months.