Social Security (Special Rules for End of Life) Bill [HL]

Baroness Sherlock Excerpts

2nd reading
Tuesday 24th May 2022 Lords Chamber

[Baroness Sherlock (Lab)]

My Lords, I thank the Minister for her introduction to this short Bill and all noble Lords who have spoken. We have packed quite a lot into a fairly short time. As we have heard, the intention is to amend the definition of “the end of life” in existing legislation, shifting it from six months to 12 months and then, in effect, to change eligibility for five benefits so that those who are expected to live for between six and 12 months can get help more quickly. These changes are long overdue and these Benches very much welcome them. I too congratulate Marie Curie, MNDA and all the charities which have campaigned to get us to this point.

We would like to see the Bill on the statute book as soon as possible. The Government have already used secondary legislation to change eligibility for universal credit and ESA, which we welcome, but it means that, for now, there is a different set of criteria for the special rules depending on which benefit you apply for. The sooner we can get them together, the better.

Since we have a legislative process to go through, this is a chance for the Government to bring the House up to speed on how people with terminal illnesses are being supported in our country. So, I have a few questions. The Government offer two arguments for this approach, the first of which is to align DWP’s approach with that of the NHS. Some interesting comments have been made: by the right reverend Prelate the Bishop of Carlisle about the importance of this being truly holistic—looking at people’s physical, mental, spiritual and financial needs—and by the noble Baroness, Lady Finlay, who, with her characteristic expertise, has helped us to understand the nature of the conversations that might happen.

I pause briefly to say that I think some clinicians find those conversations easier than others. Given that so much hinges on this, it will be important for the Minister to work with colleagues in the Department of Health and Social Care to make sure that appropriate information and encouragement is given to all clinicians to cover the full range of issues at the 12-month point. For reasons that the noble Baroness, Lady Finlay, explained, this can be a little complicated because of the imprecision of diagnoses at that distance.

The second argument given by the Government is that, when the six-month rule was introduced in 1990, many people with a life-limiting diagnosis were unlikely to survive for more than six months, but that advances in diagnosis and treatment have since moved on and now people live for much longer. The question of how long people live is pertinent to the way the special rules are framed. The right reverend prelate the Bishop of Carlisle raised questions of prognosis. The noble Baroness, Lady Noakes, gave a brief but very helpful tribute to the MNDA and highlighted the challenges for people living with motor neurone disease.

As the MNDA has pointed out, some people will of course outlive their prognosis. They could find that they are still alive after the three years for which the special rules award is offered, but are very ill—perhaps ventilated, completely paralysed or unable to speak. At that point, they will be asked to make a new application for fresh benefits. The MNDA argues that, since motor neurone disease is incurable and progressive, the benefits awarded under special rules should be lifelong. It points out that, if you apply under the normal rules, you could end up with an ongoing award with only a light-touch review at the end of a 10-year point, but you do not get that under special rules.

Did the Government consider making some categories of special rules awards lifelong, or doing something of the kind mentioned by the noble Baroness, Lady Finlay, by considering whether someone in that circumstance might be better off in a normal rules process? Can the Minister tell the House how many people are in this position under the current rules? I am assuming that it will not be very many. How many people could outlive their diagnosis at the moment and therefore bump up against the three-year problem? Has the department estimated what figure this might be under the 12-month rule?

The noble Baroness, Lady Brinton, the noble Lord, Lord Balfe, and others asked how people will get to know about these rule changes; that is incredibly important. I understand that any third party can make a claim for benefits on behalf of someone who is terminally ill, even if they do not have a power of attorney or an appointeeship. Given that, it will be extremely important that clinicians know about this change, but also that family, friends and others should get to know that this is available for somebody who may seem some way away from the end of their life, unlike the situation right now. Can the Minister tell the House what the Government will do to make sure this is as widely known as possible?

The good thing about special rules claims is that they are fast-tracked and there is no waiting period. A number of noble Lords have asked how long this will take. The noble Baroness, Lady Brinton, pressed the point to make sure that the time taken to process claims does not increase as a result of expanding the case load. I understand that new PIP claims under special rules are currently being cleared in three working days, on average. That is marvellous but it contrasts with an average of 22 weeks for a normal PIP claim, and this is of course why we need special claims—because it takes such an incredibly long time to process a normal claim.

That means that, if somebody were to die in 18 months, they would be waiting for over five of those months to get their claim for PIP processed. Once they have made an application, if, at some point while they are still waiting to get the claim processed, they are told that they have less than 12 months to live, does that mean—can the Minister confirm—that they would automatically be moved on to the fast track and the claim backdated to when they first made an application? Will the Minister reflect briefly on whether it is really acceptable to take over five months to process a claim for PIP when the people waiting to get it may be severely sick or disabled?

We are also being told by the Minister that, in most special rules cases, the highest level of benefit is awarded, but the noble Baronesses, Lady Brinton and Lady Janke, made the point that that does not necessarily apply to all claimants, including children. As we have heard, children can receive the higher-rate mobility component of DLA only when they hit the age of three, and the lower rate from the age of five. I gather from Together for Short Lives that that is based on the advice to the DWP that only when the child gets to three can you work out whether they are unable to walk as a result of a disability, rather than their taking time to learn to do so.

The case was made by Together for Short Lives and by some noble Lords that this is not simply about mobility in the traditional sense. If children or their parents depend on a vehicle for bulky medical equipment or on being able to get to an emergency service quickly, they clearly have mobility needs, even if not for those reasons. I too would be interested to hear whether the Government have responded to the SSAC report from 2020 recommending that they revisit this question of mobility, particularly for children under three. Can the Minister also say whether the Government considered that applications made under the special rules for babies and children under three who have 12 months or less to live should allow access to the DLA mobility component?

I will not dwell on this for too much longer, but the question of poverty facing terminally ill people was raised by the noble Lord, Lord Balfe. I am glad he found the Marie Curie report to his profit; it is very interesting and I also commend it to the House. I was quite shocked by its statistic that one in six people who die in the UK every year die below the poverty line. Of those of working age who die, it is one in three; a third of those of working age who die, says Marie Curie, will die in poverty. It is worse for families with kids because they often end up having to give up work, with increased childcare costs.

Marie Curie makes a number of recommendations: early access to the state pension, extra help with childcare, people under 65 getting access to winter fuel payments, and the run-on of carers’ support, which was mentioned by the noble Baroness, Lady Finlay. What consideration is being given to those proposals? Will the Minister commit the Government to responding to this report in detail?

Finally, I pay tribute to all those who support people who are approaching the end of life: the medics, nursing staff, healthcare assistants, chaplains, friends and family, those in charities, volunteers, carers, taxi drivers, ambulance drivers and all those who support people through what is one of the most difficult but also important times, which comes to each one of us in due course. How we as a society treat people in the last year of their life is an indicator of our core values. We cannot stop people dying, but we can treat them well and at least ensure that they do not die in poverty. That should be our shared goal.

[Baroness Stedman-Scott (Con)]

My Lords, I thank your Lordships for your contributions to the debate today. I am sure we all agree that this is a matter of huge importance for those at this stage of their life and their loved ones. The Government are committed to improving how the benefits system supports people nearing the end of their lives.

This Bill will ensure that thousands more people at the end of their lives can get fast-tracked access to three disability benefits—the personal independence payment, attendance allowance and disability living allowance—earlier than they currently do. It will change eligibility so that those expected to live for 12 months or less, as opposed to six months, which is the current rule, will receive vital support. The changes ensure a consistent definition of end of life across health and welfare services and introduce easily understood criteria, which will support implementation. The changes will ensure we have a system that works and that gives those affected the support they need when they need it, and that clinicians and charities can engage in with confidence.

I will try to answer some of the many questions raised by noble Lords. The noble Baronesses, Lady Brinton and Lady Sherlock, asked about the response time for fast-tracked claims. PIP end-of-life claims are fast-tracked: it currently takes three working days for new claims and four working days for reassessments. This compares to the current average end-to-end process for new PIP claims of 22 weeks.

The noble Baronesses, Lady Brinton and Lady Sherlock, raised the mobility component of disability living allowance for children under three. Only children over the age of three can claim the higher-rate mobility component of DLA, as all younger children have substantially fewer mobility needs. This group can however still access other forms of support, including the care component of child DLA. There are no current proposals to change the current age restrictions for the mobility component of child disability living allowance. However, the department recognises the difficulties that some families with severely disabled children under the age of three may face, particularly those whose reliance on bulky medical equipment makes transport difficult. As a consequence, the department has been in discussions with the charities Motability and Family Fund to explore options for helping this group of children. A pilot scheme has been developed and is making good progress. Family Fund is selecting children with a profound disability who are under the age of three and are therefore ineligible for DLA but who would benefit from the use of a vehicle provided by Motability Operations. I am sure that the Minister for Disabled People will be very happy to meet the noble Baroness, Lady Brinton, and Together for Short Lives. I will go back to the department and put the wheels in motion for that.

The right reverend Prelate and the noble Baroness, Lady Finlay, raised the difficulty of accurate prognosis, which gets worse the longer it is. The department recognises that determining a prognosis is not an exact science. The definition in legislation is clear that it applies where there is a reasonable expectation that death in consequence of a progressive disease is expected in the next 12 months. We support this in our guidance for clinicians, where we ask whether they would be surprised if their patient were to die in the next 12 months and to consider the expected prognosis. We expect the new 12-month approach to mean that thousands more people will be able to benefit, and we have already heard back from senior clinicians that the 12-month approach helps clinicians feel more confident when determining whether someone meets the special rules in the benefits where it has already been implemented. The department is clear: we are relying on the best judgment of clinicians, there are no repercussions for clinicians whose patients live beyond the time period, and claimants receive three-year awards in recognition of that fact.

The right reverend Prelate raised the issue of ensuring that financial assistance does not come at the expense of better or more widespread palliative care for all. The department has chosen 12 months to align with the NHS definition of end of life and to link up with existing initiatives for clinicians to identify people in their final year of life. We hope that, as part of clinicians’ holistic approach to considering their patients’ needs when they enter the final year of life, the financial support available to a patient is considered alongside their physical, spiritual and other support requirements.

My noble friend Lady Noakes raised the point about the DWP committing to monitoring impact and being prepared to make changes based on evidence and data. I have no doubt that this will happen in the department, but I will go back, raise the specific point and write to my noble friend to clarify.

The noble Baroness, Lady Brinton, wanted to know how doctors, who are key to this, will hear about these changes. We have had extensive engagement with health professionals and others. Let me just read a few, because there are pages of them. The Minister for Disabled People led an update call with policy representatives from Marie Curie, Macmillan and MNDA. We have had royal college round tables with the Royal College of General Practitioners, the Royal College of Physicians and the Royal College of Nursing. We had a workshop with Macmillan benefits advisers. We have had the Westminster Health Forum, the next steps for palliative and end-of-life care bulletin in hospice leaders’ brief and the Association for Palliative Medicine bulletin. I can assure noble Lords that there has been extensive communication. We are developing a bulletin jointly with the Association for Palliative Medicine, a Hospice UK Project ECHO newsletter, learning models for clinicians, royal college features in their communications, a palliative and end-of-life care information session and further workers’ engagement sessions.

The noble Baroness, Lady Finlay, made the important point about claimants being informed when they are coming to the end of their three-year award. A letter is sent ahead of the end of the award inviting them to resubmit information. If they continue to meet the special rules criteria, they will receive another three-year award.

The noble Baroness also asked about doctors signing medical evidence and how we will monitor the evidence received. The medical evidence forms used in support of a special rules claim can be requested only by clinicians and are not publicly available. The DWP’s in-house clinical team also undertakes occasional audits of medical evidence and uses feedback from the process to further improve forms and guidance. Where the DWP is unsure about the information provided or needs to clarify, clinicians from the DWP assessment provider can contact the clinician to ensure that the claim can be processed quickly. She asked what would happen to those claims if identified and what AI programmes are being developed. The DWP is also looking at making process improvements for the special rules end-to-end customer journey. I can ask officials to consider this moving forward.

I take fully the points noble Lords have made about engaging with patients and people using the system. The noble Baroness, Lady Finlay, specifically asked to meet Ministers to discuss the guidance and the forms. I can only say that my officials will be very happy to discuss the existing guidance for commissions; where it can be further improved, we will do so.

The noble Baroness, Lady Finlay, asked what financial support we can give parents when children die. Child DLA stops when the child dies because it is an extra cost benefit for the child and not an income maintenance benefit for the family. She also asked for the latest on the severe disability group; we recognise that people who may not meet the special rules criteria may still have severe and lifelong conditions that will not improve and will always need extra financial support to live independently. That is why we want to test an approach for a new severe disability group, or SDG, so that those people can benefit from a simplified process that does not involve a face-to-face assessment. The department will work closely with the MNDA, Marie Curie and other stakeholders to understand how best to orientate claimants to the new SDG application gateway and design a process that best meets their needs.

The noble Baroness, Lady Finlay, asked what happens if a person outlives their prognosis. Where someone makes a claim under the special rules, they are given a three-year award. This recognises that making a prognosis is not an exact science. Where people live longer than expected, they should continue to receive the support provided to them by the benefits system. She also asked how relatives will be informed about the cut-off point, which I believe I have answered, and what we are doing about people with longer prognoses. The Shaping Future Support: The Health and Disability Green Paper recognises that people who may not meet the special rules criteria may still have severe and lifelong conditions that will not improve and will always need extra financial support to live independently.

My noble friend Lord Balfe and the noble Baroness, Lady Sherlock, raised the issue of secondary legislation. We are currently in primary legislation. There are no plans to change the law again, so this Bill takes the simplest approach to change to 12 months.

My noble friend raised a really important point about whether terminally ill people can still work. Where work is therapeutic and gives them a purpose in life, in very difficult circumstances, the answer is absolutely yes. Those on universal credit can voluntarily take up work where appropriate.

The noble Baroness, Lady Janke, asked about the specialist unit in the DWP. We are actively considering how we can improve the special rules processes; we will keep all noble Lords apprised of that.

The noble Baroness also raised specific guidance and training being provided. The DWP is working closely with clinicians from charities, royal colleges and, in particular, the ambitious partnership for palliative and end-of-life care, as it has done throughout this process, to consider specific communication and training for clinicians about how to support their patients in claiming under the special rules and raise awareness of the eligibility criteria and process. The department worked with senior clinicians to develop a special rules guide for clinicians and, to support them in this process, will continue to monitor the guide’s effectiveness and whether further support is required. My officials would be happy to discuss where the existing guidance for clinicians could be further improved.

The noble Baroness also asked why we are not adopting an open-ended approach with no time limit, based on clinical judgment. The department considered all the feedback it received from the evaluation and decided to adopt an approach that mirrors the one used in the health system; there was significant support from clinicians for this.

The noble Baroness, Lady Sherlock, raised the fact that charities such as the MNDA have called for award lengths to be extended. Although we have already touched on this, a three-year award strikes a balance around recognising that making a prognosis is not an exact science. Where people do live longer, as I have said, support will be provided to them by the benefits system.

The noble Baroness made a point about the PIP assessment times. I can say to her only that we want them to be much shorter. The Minister for Disabled People is working hard to do that and I am sure that, in due course, an all-Peers briefing session in which noble Lords will have a chance to make their points will be available on this issue. The noble Baroness asked for some stats. We will write to her on that point and place a copy in the Library to share it with everyone.

We have only recently got the Marie Curie report. We are seriously considering it but, having listened to everybody, it seems that it is welcome. We will respond in due course.

The noble Baroness, Lady Sherlock, asked how the benefits system links to the NHS. We hope that, as part of clinicians’ holistic approach, financial support is discussed alongside physical, emotional and spiritual needs as a patient enters their final year. The DWP has worked with DHSC and many key stakeholders to create guidance to support clinicians.

The noble Baroness asked what the department’s position is on the recommendation in the Marie Curie report that recommends early access to the state pension. We are still considering the report at this early stage, as I have said. We value Marie Curie as a key stakeholder and welcome our ongoing dialogue. The Government are committed to improving fast-track access to benefits for people nearing the end of their lives; I hope we have demonstrated that. The Bill makes similar changes to DLA, PIP and AA collectively; these changes will enable thousands more people thought to be in the final year of their lives to get fast-track access to the benefits they are entitled to.

The noble Baroness, Lady Sherlock, made a point about a SSAC report in 2020. I must confess, I am struggling—

[Baroness Sherlock (Lab)]

If I may help, the 2020 SSAC report recommended that the Government review whether children aged under three could be eligible for the higher rate component of DLA.

[Baroness Stedman-Scott (Con)]

I thank the noble Baroness; that is helpful. Other questions were raised and I will, as always, go back to Hansard and ensure that I answer them in writing and place a copy in the Library.

I again put on record my thanks to the individuals, charities, clinical groups and all the others, including the trade unions, who have supported the Department for Work and Pensions since the then Secretary of State launched an in-depth evaluation of how the benefits system supports people nearing the end of their lives in 2019. We recognise the vital role they play and are committed to continuing our engagement with them as the changes the Bill will make are implemented. I thank all noble Lords again for their contributions today and I hope I have managed to reply to everyone. As always, I am happy to speak to any noble Lords who want to discuss particular issues further before Committee stage; as ever, the door is open. I beg to move.

Senior Citizens: Means-tested Benefits

Baroness Sherlock Excerpts

Monday 23rd May 2022 Lords Chamber

[Baroness Stedman-Scott (Con)]

I reiterate what the Prime Minister has said: no option is off the table. We will do what we can but noble Lords will have to wait a little longer for those announcements to be made.

[Baroness Sherlock (Lab)]

My Lords, I am glad that nothing is off the table but I would quite like to see something on the table. Maybe the Chancellor could be encouraged to think that there is a bit of urgency about this. One reason take-up is not always the answer is that the amount of pension credit that goes unclaimed is around £1,900 for every family entitled to receive it. That is why the state pension matters so much and why abolishing the triple lock this year—of all years—was so damaging. However, as this is about take-up, I looked at the stats and found that take-up is lower among older pensioners than younger ones. It is markedly lower for pensioners who are single rather than in couples. What does that tell the Government and what are they going to do to make sure that the money gets to where it is most needed?

[Baroness Stedman-Scott (Con)]

On pension credit take-up, the noble Baroness has made interesting and accurate points. We have this campaign. The Minister for Pensions is working with the BBC, other media outlets, GP surgeries, post offices and so on. It is our job to make sure that people are aware of the benefits of pension credit and to encourage take-up, but there is only so much we can do in that way. We really believe that families could be helping relatives entitled to pension credit to claim it.

Social Security System: Rising Cost of Living

Baroness Sherlock Excerpts

Tuesday 17th May 2022 Lords Chamber

Asked by

[Baroness Sherlock]

To ask Her Majesty’s Government what assessment they have made of the effectiveness of the social security system in the context of the rising cost of living.

[The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office and Department for Work and Pensions (Baroness Stedman-Scott) (Con)]

My Lords, no specific assessment has been made. We are committed to supporting those on low incomes and will spend around £255 billion through the welfare system in 2022-23. We are supporting households with cost-of-living measures worth over £22 billion this year, including changes to universal credit to make work pay, the £9.1 billion energy package to help us with rising energy bills and an additional £500 million to help households with the costs of essentials.

[Baroness Sherlock (Lab)]

My Lords, it is not enough. The welfare state was created to provide security in retirement and to make sure that life events did not result in destitution. Last month, the state pension went up by 3% for the year, as did benefits for children, disabled people and low-earners. In the real world, we all know that inflation is heading for 10% and energy prices have gone mad. The Governor of the Bank of England has just said that food prices will be rising apocalyptically. Does the Minister accept that growing numbers of both older and younger people literally do not have enough money to buy food and pay their bills? If so, will the Government bring forward benefit increases or find some other way to stop people falling into modern-day destitution?

[Baroness Stedman-Scott (Con)]

The Government, of which I am a member, acknowledge that these are very difficult times, particularly for pensioners and young people with families. The uprating of benefits has been done in September; that is how the Secretary of State uses the CPI figure. However, I can confirm that the Government have convened a new cost of living ministerial committee and the PM has urged Ministers to go faster and be as creative as possible in ensuring that the Government are doing everything they can on this important issue. The Chancellor and Prime Minister are working extremely closely on this and will continue to do so because they are cognisant of the very communities that the noble Baroness is representing.

Women: Cost of Living

Baroness Sherlock Excerpts

Thursday 10th March 2022 Lords Chamber

[Baroness Stedman-Scott (Con)]

Many noble Lords have made the point about the £20 uplift. To be absolutely straightforward and open, there is nothing I can say about it, other than that for those on universal credit the taper rate compensated for some of the withdrawal. There are moments when I wish I was Chancellor.

[Baroness Sherlock (Lab)]

My Lords, let me spell out what this is going to do. Inflation is running at record rates. The Bank of England forecasts that, next month, it will go up to 7.25%. That forecast was made before the war in Ukraine. Benefits are going to go up by 3%. Next month, the energy price cap will go up to £2,000. People are currently being offered £3,500 fixed-price tariffs. To put that in context, that is £67 a week. We give an adult on universal credit or JSA £75 a week to live on. How are they possibly meant to manage?

Scotland Act 2016 (Social Security) (Adult Disability Payment and Child Disability Payment) (Amendment) Regulations 2022

Baroness Sherlock Excerpts

Thursday 10th March 2022 Grand Committee

[The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office and Department for Work and Pensions (Baroness Stedman-Scott) (Con)]

My Lords, I beg to move that the draft Scotland Act 2016 (Social Security) (Adult Disability Payment and Child Disability Payment) (Amendment) Regulations 2022, laid before the House on 24 January 2022, be approved. I am pleased to introduce this instrument. Subject to approval, it will make some necessary legislative changes to prevent overlapping entitlements of the soon-to-be-introduced Scottish adult disability payment, with UK disability benefits.

In consequence of the Scottish Government’s child disability payment, very similar regulations were made in July 2021. As these regulations mirror, in relation to adult disability payment, much of the policy intent and technical application of the previous instrument, I hope that noble Lords will forgive me if I repeat much of what was said during the debate on those previous regulations. My honourable colleague the Minister for Disabled People, Health and Work brought this instrument before the other place on Monday, so there is little new to outline in my opening remarks. I am satisfied that the Scotland Act 2016 (Social Security) (Adult Disability Payment and Child Disability Payment) (Amendment) Regulations 2022 are compatible with the European Convention on Human Rights.

The UK Government are committed to making devolution work and to ensuring the transition of powers to the Scottish Government under the Scotland Act 2016. This is a long-standing commitment. As a result of the devolution of social security powers to the Scottish Parliament under this Act, the Department for Work and Pensions will need to update its legislation from time to time to reflect the introduction of the Scottish Government’s replacement benefits. Section 71 of this Act allows for the necessary legislative amendments, in this case as a result of benefits introduced under the Social Security (Scotland) Act 2018.

I am grateful for the opportunity to debate these regulations today. They will effect some purely technical, administrative changes. They will prevent overlapping payment of the Scottish adult disability payment and UK disability benefits such as the personal independence payment and Armed Forces independence payment. The instrument also includes some time-limited overlapping provisions for Northern Ireland.

Noble Lords will be aware that the Social Security (Scotland) Act 2018 established the legislative framework for the Scottish Government to introduce new forms of assistance using the social security powers devolved under Section 22 of the Scotland Act 2016. Specifically, Section 31 of the 2018 Act allows the Scottish Government to introduce legislation to provide financial support through its disability assistance for people in Scotland with long-term additional health needs.

The Scottish Government recently legislated to provide for its disability assistance for working-age people, which will be introduced from the 21st of this month. They are calling this “adult disability payment” and I will refer to this as ADP from now on. If the regulations are passed today, they will ensure that there are clear boundaries between entitlement to ADP and entitlement to a relevant UK Government benefit to ensure that there is no overlapping provision of payments. It will do that by making it clear that a Scottish resident cannot be entitled to a relevant UK Government benefit and that in the case of those who move cross-border, a DWP payment will not start until the day after payment of ADP has ended. This will not only protect the public purse by avoiding double payment to the same claimant for the same need but help prevent the need for complicated overpayment calculations and recovery. Furthermore, it is also in the best interests of the claimant, who will have clear expectations of which Government are responsible for paying their benefits at which point in their claim or award.

As just noted, as part of the offer, although ADP has residency-based conditions attached, the Scottish Government will continue to pay ADP for a period of 13 weeks after a claimant has left Scotland and moved to another part of the UK. This will allow claimants time to sort out new benefit arrangements, should they wish to, and the instrument sets out that a successful claim to a UK Government benefit will start the day after the end of that 13-week period.

Our intention is to offer later this year a similar facility for those moving to Scotland, and this is not the subject of these regulations brought before this Committee today. What are needed now are modest but necessary legislative amendments to avoid overlapping payments in order to both support the devolution agenda and strengthen a union that works together in the best interests of our shared citizens. The instrument also includes provisions on behalf of the Ministry of Defence to ensure that Armed Forces independence payments will similarly not overlap with ADP.

Finally, provisions have been included to prevent overlapping entitlement when a claimant moves to Northern Ireland and is in receipt of the 13-week run-on payment from the Scottish Government. I commend this instrument to the Committee.

[Baroness Sherlock (Lab)]

My Lords, I thank the Minister for introducing these regulations. As we have heard, following devolution of responsibility for certain social security benefits, the Scottish Government are introducing ADP for applicants ordinarily resident in Scotland. It will start to replace personal independence payment, PIP, in Scotland from this month.

The primary purpose of these regulations, as the Minister has explained, is to prevent overlapping payments of attendance allowance, DLA, PIP or Armed Forces independence payment when a claimant is getting ADP. We support the instrument and are pleased to see the Scottish Government using the powers transferred to them under the 2016 Act and subsequent legislation—although I express a bit of disappointment that it has taken such a long time for this to happen. It is critical that the rollout of ADP goes well, and that the transition from the current regime is smooth. Since these regulations are part of that process, we want to see them succeed and are pleased to support them.

The Minister mentioned that ADP will carry on being paid for a period of 13 weeks following a move from Scotland to England or Wales or Northern Ireland, to allow the claimant time to make a claim for the relevant benefit. When the Social Security (Scotland) Act (Disability Assistance and Information-Sharing) (Consequential Provision and Modifications) Order 2022 was discussed in the other place on 2 March, the Minister Iain Stewart said:

“At its introduction, adult disability payment will operate in broadly the same way and for broadly the same group of people as personal independence payment.”—[Official Report, Commons, Delegated Legislation Committee, 2/3/22; col. 3.]


So can the Minister tell the Committee whether the conditions for eligibility for ADP are the same as they are for PIP, or will someone moving from Scotland to another part of the UK have to undergo a fresh assessment to get PIP? If they do have to be assessed, is that classed as an assessment or a reassessment? There is a distinction in terms of time, as the Minister will know, and priority for processing a claim.

The Minister Iain Stewart also said:

“The 13 weeks is a safety net, and applications can be made in advance. It is there to ensure that payments can continue if there is some delay, so that no one is disadvantaged.”—[Official Report, Commons, Delegated Legislation Committee, 2/3/22; col. 8.]


The intention clearly is that there should not be a gap in payment between somebody moving from Scotland on ADP and coming to England, say, and claiming PIP. So can the Minister tell the Committee how long it takes to process a claim for PIP? Is she confident that 13 weeks will be long enough to ensure that there is no break in payment?

I dug out what I think are the latest official statistics, which were for last October, and which showed that clearance times for normal-rules new claims were 24 weeks from registration to a decision being made—and that is assuming the claimant was not one of the millions who end up having to go for mandatory reconsideration to get their benefit established in the first place. That adds another 11 weeks to the process. So can the Minister tell the Committee whether this means that, if someone moves from Scotland to England—just across the border, say, to Berwick—then makes a claim, and it takes either 24 or potentially 35 weeks, they will still get only 13 weeks’ run-on? What happens to them during those remaining weeks when they are still waiting for their claim to be processed? Also, does the comment by Iain Stewart about applications being made in advance mean that someone preparing to move from Scotland to England or Wales could make a claim for PIP while they were still living in Scotland in advance, as they prepared for their move to England—again, to avoid any gap in payments? That might deal with the problem that it takes longer than 13 weeks to process a claim.

I understand that applications for ADP will open at different times in different parts of Scotland. I think it will be piloted in some parts. Does the Minister know when it will be fully rolled out? If somebody were to move now from England and they happened to land in the bit of Scotland where it is being piloted, presumably they would have to make a fresh application for ADP. The Minister mentioned that the intention of the Government was to arrange this so that the run-on is a two-way street—so that, in due course, if you move from England to Scotland, you will get a 13-week run-on of PIP while you make an application for ADP. In fact, Iain Stewart said in the Commons that

“the situation does apply both ways. If a person in England claims PIP or one of the other benefits and moves to Scotland, the DWP would look to ensure they had an equivalent transition period.”—[Official Report, Commons, Delegated Legislation Committee, 2/3/22; cols. 7-8.]

But if somebody on 1 April were to move to Scotland and happened to be in an area where they had started doing ADP, would they get a run-on or no run-on? Would they suddenly find that their PIP stopped immediately and they had no benefits at all until their ADP was processed?

Finally, the Minister said something about the regulations also introducing some time-limited overlapping provisions for Northern Ireland. Can she tell us what they are, because I could not figure it out? I apologise for that and look forward to her reply.

[Baroness Stedman-Scott (Con)]

My Lords, I thank the noble Baroness, Lady Sherlock, for the points she has made. I shall try to deal with them.

I turn first to what happens to a person if they move now. While DWP is administering the existing disability benefits on behalf of the Scottish Government under agency agreements, any customer moving to Scotland will be handled as a routine change of circumstances. This means that these cases will continue in payment on the same benefits as now and form part of the Scottish caseload administered on behalf of the Scottish Government. DWP will continue to manage their claim until they are transferred to Social Security Scotland. The case transfer process has been agreed with the Scottish Government and claimants will not see any disruption to their payments.

--- Later in debate ---

I believe that the noble Baroness was very keen for us to say that PIP is taking far too long, and with the 13 weeks there might be a break in payment. If she will allow me to, I shall go back to the officials to get more detailed information, in the hope that I can answer her question in full.

[Baroness Sherlock (Lab)]

I am grateful for the considerable information that the Minister has given me. In fact, I was not asking or generally complaining about PIP being slow, which is what she said. I do think that it is too slow, but that was not my point; my point is that everything about the description of ADP suggests that the intention is that there will not be a break in payment. The Minister in reply to me has just said that the 13-week run-on will reduce the risk of a break in payment, but it is the claimants’ responsibility to apply quickly. As she seems to be suggesting that a claim cannot be made until the claimant has actually moved to England, and if there is only a 13-week run-on, and even if she applies on day one, it takes 24 weeks to process the claim, even if she discharges her responsibility with impressive speed, it seems impossible to avoid there being a break. That is what I am interested in. What are the Government going to do about that?

[Baroness Stedman-Scott (Con)]

I think that I was trying to make the point, although I accept that I made it badly, that on the specific point that the noble Baroness has just raised I want to go back to the officials to get more detail, because this must have crossed their desks as a risk. If the noble Baroness will allow me, I shall write to confirm.

As I have said, the UK Government are working collaboratively with the Scottish Government to ensure that the two systems of social security will operate effectively alongside each other, and the required legislation that underpins them is delivered successfully for the people of Scotland and, where relevant, claimants in England, Wales and Northern Ireland. The order highlights the importance that the UK Government place on the effective functioning of devolution. I commend the order to the House.

Social Security Benefits Up-rating Order 2022

Baroness Sherlock Excerpts

Wednesday 9th March 2022 Grand Committee

[Lord Shipley (LD)]

My Lords, I thank the Minister for introducing this uprating order. The problem is that the combination of rising inflation and tax rises is creating a cost-of-living crisis that will affect practically every household in the UK but will be especially difficult for those on low incomes who make use of welfare payments.

Before the crisis in Ukraine, the Resolution Foundation reported that an average family will see household budgets reduced by £1,200 a year through a combination of soaring energy prices, the freezing of the income tax personal allowance and the rises in national insurance and council tax. Those on low incomes will find it hardest to make ends meet, because the major benefits are due to go up in line with a lagged measure of inflation. The September CPI rate had it at 3.1%, whereas the Bank of England expects inflation to peak at 7.25% in April and to average around 6.2% in the course of 2022—and all that is before the impact of the crisis in Ukraine is taken into account. Many commentators are forecasting an inflation rate for the UK of more than 10% later this year.

The Government really must not allow a situation to develop that means a deep cut in benefits year on year for people less able to withstand the impact of the rising cost of living. For example, those who must use meters to pay for their gas and electricity will be put under even greater financial strain because of their high cost compared with other methods of payment.

Even before the impact of the Ukraine crisis on the cost of living, this policy would have led to a £290 real fall in benefit income year on year for the 10 million households in receipt of these benefits. That would be an unacceptable cut in the incomes of millions of people who are already among the most vulnerable. The Spring Statement later this month provides an opportunity for the Chancellor to do something about this crisis, which was unnecessarily deepened by the removal of the £20 per week boost to universal credit.

Paragraph 12.1 of the Explanatory Memorandum on impact is hopelessly out of date. The assertion that the

“impact on business, charities or voluntary bodies is negligible”

is flawed. The impact will be very great, particularly on charities and voluntary bodies, which will see a huge increase in demand for their help as prices rise steeply and real incomes decline for millions of households.

I hope that the Minister will agree that this uprating order is out of date and that the Spring Statement needs to bring proper solutions to the deepening crisis in our cost of living and its impact on those with low incomes.

[Baroness Sherlock (Lab)]

My Lords, I thank the Minister for introducing these orders and all noble Lords who have spoken. I agree with my noble friend Lord Jones that it would have been preferable had the uprating order been taken in the Chamber. Many of the orders that we deal with are technical; this one affects the incomes of some 20 million people at a time when we have never seen a cost-of-living crisis like this. Had it been taken in the Chamber, we perhaps would not have had a regret Motion, but here we are.

I thank my noble friend for mentioning my late and much-lamented noble friend Lord McKenzie. Every time we gather here, we miss him very much. I just wanted to read his name into the record.

First, a word on the guaranteed minimum pensions order, which is rather more technical. I have raised the question of equalisation in most previous years, but we have had a new development. A new Private Member’s Bill has just arrived in the Lords from the other place that aims to address the legal uncertainty that the current legislative situation can pose when a pension scheme tries to adopt a process for addressing GMP equalisation. The Government smiled on it at the other end. At Second Reading in the Commons, the Pensions Minister, Guy Opperman, accepted that what the Bill does is key because it

“gives the Government the ability to set out in regulations the details of how survivor benefits will work for surviving spouses or civil partners of people with guaranteed minimum pensions.”

He also made the point that the Bill

“gives the Government the ability to set out in regulations details about who must consent to the conversion of guaranteed minimum benefits.”—[Official Report, Commons, 26/11/21; col. 627.]

The Minister confirmed, at col. 628, that the Government backed the Bill. However, when the Commons got to Third Reading on 25 February—a long gap—he said:

“The reality is that there is no real way for my hon. Friend’s Bill to get through this House and the House of Lords in the time allowed”.—[Official Report, Commons, 25/2/22; col. 659.]


The Government have accepted that there are problems to be addressed on the matter of GMP equalisation, so can the Minister assure the Committee that if that Private Member’s Bill fails to get through, the Government will none the less speedily moved to address the outstanding issues?

I turn to the Social Security Benefits Up-rating Order, which we gather to debate every year, except of course during the years of shame, when the Government refused to update social security benefits as they should have done. I cannot remember a year when the context was so worrying for so many people. The cost of living is rising so fast that even those on middle incomes are struggling and it is a catastrophe for those on lower incomes. People are genuinely frightened about how they are going to manage. Demand for help from food banks is already skyrocketing, as it is for financial advice and debt support. The noble Lord, Lord Shipley, made a good point that the Explanatory Memorandum had not taken account of the impact on those organisations.

--- Later in debate ---

If the order is voted down, the 3.1% increase will still go ahead in April, because the IT process cannot be changed at this stage. The increase will, however, have no legal underpin. That is why I urge the House to approve the order, so that there can be certainty of outcome for the 20 million people who receive state pensions and benefits from DWP.

[Baroness Sherlock (Lab)]

I thank the Minister; I definitely have not had that answer before. In her mind, then, what is the point of this debate?

[Baroness Stedman-Scott (Con)]

The point of the debate is to approve the order. Here we go.

[Baroness Sherlock (Lab)]

Perhaps the Lord Chairman will allow me a little licence. I understand why the Minister said that, but I want to get to the bottom of what it is we think we are doing here. So the computers are changed in December and, if either House rejects this order, the increase goes ahead anyway; it just does not have any legal underpinning. Perhaps I have been spoiled, but I am accustomed to thinking that, when the House is asked to take a decision, that has a consequence: if we say yes, something happens; if we say no, something does not happen. This is the first time that I have been aware of being asked to take a decision and being told that, if we said no, it would not make any difference. Does the Minister not think that that is a little unusual?

[Baroness Stedman-Scott (Con)]

Further information: if the House votes the order down, that is a sign that the Government must change the process.

--- Later in debate ---

[Baroness Sherlock (Lab)]

May I suggest a pay rise for whichever member of the cavalry sent a note in her direction? To be clear, we will not oppose the order. I just wanted that point to be clear and I thank her very much.

[Baroness Stedman-Scott (Con)]

I am not giving pay rises, I can assure the noble Baroness.

[Baroness Stedman-Scott (Con)]

As I said, I fully appreciate the issue of people who use keys to pay their energy costs, which are higher. Let me take that back as a special project. I will speak to the Secretary of State, who I will see tomorrow, and she may well have a thought on that. When it comes to the Spring Statement, all noble Lords tell me to speak to the Treasury. I have nothing to tell your Lordships about the Spring Statement; we will have to wait to see what, if anything, comes out in relation to this. I take the point of the noble Lord, Lord Shipley, about charities, but that is an indirect effect, if it happens. I cannot add more than that at this stage.

The noble Baroness, Lady Sherlock, talked about poverty, a subject that we have discussed many times. The Government are committed to a sustainable long-term approach to tackling poverty, and to supporting people on lower incomes. We will spend £110 billion on welfare support for people of working age in 2021-22. With around 1.29 million vacancies across the UK, our focus is firmly to support people to progress into work as the best way to substantially reduce the risks of poverty.

I know that there are people who cannot work, and I know the passion with which the noble Baronesses, Lady Lister and Lady Sherlock, and others talk about us wanting to help that group. Our multi-billion-pound plan for jobs, which has been expanded by £500 million, is helping people across the country into work. I know that our new Way to Work programme has raised some issues. As I have said before, when I opened the jobcentre in Hastings, the staff were alive with the freedom that it would give them to do more, and in more detail, to help people at the lowest point of their lives. I trust those work coaches implicitly to do what they can and, more importantly, to feed back if something is not working so that we can fix it.

The noble Baroness, Lady Sherlock, asked whether I still believed a Statement that I made. Perhaps she can write to me, as I did not quite catch the context. I will be very happy to write back.

[Baroness Sherlock (Lab)]

If the Minister reads Hansard, that might cut out a stage.

Occupational Pension Schemes (Collective Money Purchase Schemes) Regulations 2022

Baroness Sherlock Excerpts

Wednesday 23rd February 2022 Grand Committee

Obviously, the regulator has to comply with the law and protect members’ interests, but if it adopts a bureaucratic, nitpicking approach to how these regulations and requirements are met, we will have very slow progress on what is an important and useful development as a type of pension provision. We have to emphasise this to, and work with, the Pensions Regulator to ensure that it adopts a practical approach and enables other employers to think, “This isn’t going to be a nightmare; we can actually do this”.

[Baroness Sherlock (Lab)]

My Lords, I thank the Minister for her introduction to these regulations and all noble Lords for their contributions. As some noble Lords will remember, we spent a long time debating the Pension Schemes Act in this House. We asked lots and lots of questions about the establishment of CDC pension schemes. When we asked questions of the Minister, at least some of the time the answer came back: “The detail will be in the regulations”. Now here we are; here are the regulations and they will implement the authorisation and supervisory regime for CDC schemes. It is not surprising that so many questions have come from my noble friend Lady Drake and other noble Lords, and I am afraid I have more to add to the list. I very much hope the Minister can answer them, because this is our last chance before the scheme is created and it is incredibly important.

Here are my questions, starting with the future of CDC schemes. In his foreword to the consultation document in 2019, the Pensions Minister, Guy Opperman, said:

“There were encouraging signs of a growing interest in CDC amongst employers and commercial providers, outside of the Royal Mail and CWU. I expect this will increase further”.


It is three years down the road, and still only Royal Mail has committed to establishing a scheme. The Government admit that future take-up is still unknown.

In her contribution, my noble friend Lady Drake highlighted some of the concerns that flow from devising the details of a scheme with only one employer in mind. The future will not be the same, of course. The noble Baroness, Lady Janke, and my noble friend Lord Davies of Brixton asked what happens if other employers want to join in future. It is my understanding that we would need additional legislation if we got developments such as unconnected multi-employer schemes or commercial master trusts operating CDC schemes. The Minister can confirm that.

In such scenarios, different risks would need to be considered. One would expect the regulations and the code of practice provisions on things such as financial sustainability and trustee discretion to be more robust. For example, I would expect to see a definite requirement to ring-fence reserves to meet the costs of a triggering event or implement a continuity option; or, for example, a strengthening of trustee discretion over things such as opening new sections or the appointment of the chair of trustees. Can the Minister confirm that these regulations and the draft code of practice under consultation will not be considered fit for purpose for unconnected multi-employer and commercial master trust schemes?

The Government have acknowledged that there is considerable uncertainty as to the impact of the CDC proposal. I take the point made by my noble friend Lord Davies that, when one starts something, of course one will never fully know until it is out there. However, it is probably because of that uncertainty that the regulations and the draft code are long and complicated —because they are trying to cover for a range of circumstances. In turn, I suspect that that will mean that the CDC scheme rules are likely to be long and require a high level of understanding by trustees and their advisers. That complexity adds to the importance of clear member communications, and good systems and processes.

However, because of the way in which the rules are framed—my noble friend Lord Davies is right—a lot of responsibility will have to be borne by the regulator on some complex technical issues. If CDC schemes grow in number, as is hoped, how will the regulator, given its increasingly complex pensions remit generally, build and maintain the necessary capacity and capability to authorise and supervise such schemes? This is highly technical stuff but with a lot at stake. How is the regulator going to be able to manage it?

Next, I want to turn to the fit and proper person test for trustees. These regulations, in Regulation 8 and Schedule 1, together with the code of practice, set tough fit and proper person requirements for assessing whether a person can be a trustee of a CDC scheme, especially around skills, knowledge and experience. I am clear about the importance of ensuring that members’ interests are protected by an informed, knowledgeable and balanced team of trustees. However, the detail in the draft code leads me to ask a couple of questions. Is the Minister at all worried that the bar is perhaps set too high for committed and conscientious member-nominated trustees to meet? Is it perhaps the policy intention to squeeze out member-nominated trustees from single or connected employer CDC schemes? Is it perhaps the intention to have CDC schemes run only by professional trustees?

I realise that the scheme rules are complicated but, if schemes end up relying increasingly on professional trustees, that potentially brings a different risk: groupthink. Corporate trustees are more likely to come from the industry and may be more concerned with compliance than looking beyond it to see emerging risks. Further, a single employer or connected employer CDC scheme is established under an irrevocable trust by an employer. Could the terms of such a trust fetter the discretion of the trustees to a point and remove the chair of trustees?

Then there is the key issue of financial sustainability, about which my noble friend Lady Drake asked some crucial questions to which the Committee needs clear answers today. I am going to go back a little in history and remind the Minister of a couple of exchanges during the passage of the Bill. I must say, I was a lot more articulate in my head at the time than I was when I read it in Hansard afterwards; it is amazing how much less impressive it is when one reads it later, but bear with me. In Committee, I put this to the Minister:

“I think I understood her to say that the regulator would not approve a scheme unless the sustainability criteria had been met and that they could be met only if an adequate amount of money was placed in, for example, escrow. Is she saying that a scheme would be approved only if the regulator was satisfied that enough money had been provided up front by the sponsoring employer to fund the continuity options in the event of a triggering event?”


She replied:

“The answer to the question asked by the noble Baroness, Lady Sherlock, is yes, the money would be in an escrow account if needed.”


I pressed her further and asked:

“So could it never be the case that in the event of a triggering event, such as a wind-up, an employer pulling out or an employer downsizing, money would have to come from members’ contributions to fund the continuity option?”


The Minister’s answer was clear. She said:

“The answer to that question is no, it should not be.”—[Official Report, 24/2/20; col. GC 18.]


How can we be assured of that?

My noble friend Lady Drake had an exchange with the Minister on the same issue on Report. I hope that the Committee will bear with me if I quote again briefly. The Minister said:

“For the financial sustainability requirement at Clause 14 to be met, the trustees must provide evidence that they can access sufficient financial resources to cover the costs associated with setting up and running the scheme, as well as those associated with dealing with triggering events. If the regulator is not satisfied about the security of these resources and that they can be accessed as needed, the requirement will not be met and the scheme will not be authorised. It may well be that, in the early days of a CDC scheme, initial funding comes from the employer, but our approach does not just rely on employer-provided financial support; it enables trustees to draw on other options, including funds held in escrow, insurance policies or contingent assets. These should be available to cover any costs arising from a triggering event.”—[Official Report, 30/6/20; cols. 604.]


That raises a key question: how can the Minister assure the Committee that there will always be enough money available to meet the cost of a triggering event and implement the continuity strategy without recourse to members’ funds, as she promised on Report? Despite all our pressure, the Government chose not to require the reserves to be more obviously ring-fenced, as in a master trust. As my noble friend Lady Drake has pointed out, the requirements in the regulations and the draft code are pretty soft and unspecific. I look forward to hearing the Minister’s answer to her question as to whether there will be hard triggers—such as ratios—when we come to make those assessments.

I have gone on quite a bit but I think this is incredibly important. A lot of people will read this record—more than the number in this Room—because huge amounts of money will be at stake. If the Minister is asking the House in due course to pass these regulations, it is really important that we get some concrete reassurances on the safety of those members’ assets.

Finally on this issue, can the Minister assure the Committee that, when moves are made to extend the CDC authorisation to unconnected multi-employer schemes or commercial master trusts operating CDC schemes, the financial sustainability requirements will be more robust, given the nature of the risks and the increased scale that would bring?

The Pension Schemes Act 2021 created a whole new kind of pension scheme. That does not come along very often. These regulations are the only chance that the House of Lords will have to gain clarity on how those schemes will operate and how members’ assets will be protected. I therefore really hope that the Minister has come armed with some detailed answers. I look forward to her reply.

[Baroness Stedman-Scott (Con)]

My Lords, I thank all noble Lords for their helpful contributions to this debate. Before the noble Baroness, Lady Sherlock, raised it, memories came flooding back of our discussions on the Bill, which were lengthy and in depth.

I start by raising the points made by all noble Lords; I will try to answer at the level and detail for which the challenge has been set down. The noble Baronesses, Lady Janke and Lady Sherlock, asked how we will ensure that the CDC scheme has sufficient financial resources to cover the cost of operating the scheme if things go wrong. As part of the financial sustainability and continuity strategy authorisation criteria, the scheme must show how members will be protected against impacts, including costs, if a triggering event occurs, and must satisfy the regulator that there are sufficient protections. The financial sustainability requirements include demonstrating that there are sufficient financial resources to cover the cost of establishing and operating the scheme as well as costs arising from addressing a triggering event. This must be available to be used as and when needed.

If the regulator is not satisfied that the criteria are met, it must not authorise the scheme. The scheme will also need to satisfy the regulator on an ongoing basis that it continues to meet the authorisation criteria; for example, if the costs associated with addressing a triggering event change, the scheme must be able to show that it has sufficient resources to cover this. The regulator can require information relevant to the authorisation criteria to be included in a supervisory return. It is a significant event if the scheme is unable or unlikely to be able to meet the cost of a triggering event occurring.

Again, the noble Baronesses, Lady Janke and Lady Sherlock, raised the appointment of trustees and asked how we will ensure diversity on the board of the trustees. Our primary focus is on ensuring that trustees in all occupational pension schemes meet the standards of honesty, integrity and knowledge appropriate to their role. The regulator’s draft code of practice, published in January, sets out that trustee boards should have policies on diversity and inclusion, including objective selection criteria, and should demonstrate that they have the ability to capture, process and monitor data on diversity and inclusion. This would need to be demonstrated to the regulator for it to be satisfied both that the scheme satisfies the authorisation criterion and that the scheme’s systems and processes are sufficient to ensure that it is run effectively. The regulator will continue to supervise trustee action in this area and has established a working group to look at data, research, best practice, practical tools and employer engagement. We will look at the outcomes from the working group and consider what measures are needed.

--- Later in debate ---

The noble Baroness also asked whether the bar is set too high for committed and conscientious member-nominated trustees to meet. I believe I have answered this on the point about diversity and making sure that people have integrity.

[Baroness Sherlock (Lab)]

I apologise, I was not clear enough. My question is not about diversity in the sense that it is mostly understood; I was specifically asking whether the requirements had been framed in such a way as to be too difficult for member-nominated trustees to meet, with the effect that they would be driven out in favour of corporate trustees, which would lead to us not having a diversity of views. I was not referring to the other, more traditional, understanding of diversity.

[Baroness Stedman-Scott (Con)]

The point is very well made. We will have to work with member trustees to make sure that they are trained and that they understand the requirements prior to taking on responsibilities. I will consult my colleagues and answer in more depth in writing.

The noble Baroness, Lady Sherlock, asked whether the policy intention is to squeeze out member-nominated trustees from single or connected employer CDC schemes. The answer is no. She also asked whether the intention is to have CDC schemes run wholly by professional trustees. Again, the answer is no. She also asked a further question: “A single employer or connected employer CDC scheme is established under an irrevocable trust by an employer. Could the terms of such a trust fetter the discretion of the trustees to appoint and remove the chair of trustees?” I am advised that this is not the case and that there is no change from other schemes.

The noble Baroness also asked whether I can assure noble Lords that there will always be enough money available to meet the cost of a triggering event. As part of the financial sustainability and continuity strategy authorisation criteria, the scheme must show how members will be protected against impacts, including cost, if a triggering event occurs and satisfy the regulator that there are sufficient protections. The financial sustainability requirements include demonstrating that there are sufficient financial resources to cover the cost of establishing and operating the scheme, as well as costs arising from addressing a triggering event. They must be available to be used as and when needed. If the regulator is not satisfied that the criteria are met, it must not authorise the scheme.

The scheme will also need to satisfy the regulator on an ongoing basis that it continues to meet the authorisation criteria. For example, if the costs associated with addressing a triggering event change, the scheme must be able to show that it has sufficient resources to cover them. The regulator can require information relevant to the authorisation criteria to be included in a supervisory return. It is a significant event if the scheme is unable or unlikely to be able to meet the cost of a triggering event.

The noble Baroness asked about member-nominated trust rules applying to CDC schemes. Generally, trustees are required to ensure that arrangements are in place and implemented that provide for at least one-third of trustees or at least one-third of directors at the trustee company to be member-nominated.

The noble Baroness, Lady Sherlock, asked would— I apologise, I am struggling to read this piece of paper. I will write to the noble Baroness and place a copy in the Library so all noble Lords understand.

Benefit Sanctions on Jobseekers

Baroness Sherlock Excerpts

Thursday 3rd February 2022 Lords Chamber

[Baroness Stedman-Scott (Con)]

The noble Baroness makes a very good point. The work coaches are well trained and their relationship with employers is gathering momentum. In fact, I heard today that employers are more prepared to take people with no experience in their industry and in fact are also considering taking people they would not normally have taken, such as ex-offenders and those with autism. So, yes, I agree.

[Baroness Sherlock (Lab)]

My Lords, let us take a step back. What the Government are doing is saying to somebody who has lost their job, “If you don’t get back into your own field within four weeks, you should go and find any job and get in there fast”. The Government put out a massive press release last week saying, “We’re going to get half a million people into over a million vacancies”, and the centrepiece was the idea that you could be sanctioned within four weeks—ironically, before you even get your first universal credit payment, which takes six weeks.

Given that only 3% of universal credit claimants are even in this category—and given that all the evidence shows that most of them get back into work really quickly anyway—rather than blaming people who have lost their jobs, why not focus on long-term unemployment, people leaving the labour market and people retiring early? Let us concentrate on the real problems. Would that not be a better idea?

[Baroness Stedman-Scott (Con)]

I am afraid that on this occasion I cannot quite agree with everything that the noble Baroness said, or indeed the sentiment in which it was said. That will come as no surprise to people. The fact is that we have been working with long-term unemployed people to try to overcome their barriers and put solutions in place. I say again that when someone does not have a job and they cannot get one within the field that they are used to and skilled in, their skills can be applied to other sectors, so they can take jobs and be in work and then, when a job comes up in the field they want, we can help them apply for it. So I do not hold with what the noble Baroness says.

Underpayment of Benefits: Compensation

Baroness Sherlock Excerpts

Tuesday 18th January 2022 Lords Chamber

[Baroness Sherlock (Lab)]

My Lords, a vulnerable person with multiple health needs recovering from a heart bypass was left for years living on half the money she was entitled to when the DWP moved her on to ESA, which also stopped her getting free prescriptions and other passported benefits. The ombudsman looked into her case and reported that Ms U, as she is known, could not afford to eat properly or heat her home, and that:

“Her mental and physical health declined drastically”.


Over 118,000 other people were similarly affected. The DWP eventually paid arrears but is refusing to pay compensation. The ombudsman recommended it paid compensation

“in recognition of its error and the potentially devastating impact it has had on people’s lives.”

When this matter was debated in the Commons last week, the Minister in the other place said that the Government had published the previous Thursday an update of these cases on GOV.UK. I have searched GOV.UK, as has the Library, and have found no such documentation, so I am dependent on the Minister to answer these two questions. First, can she say whether the DWP has now complied fully with the ombudsman’s recommendation to pay Ms U £7,500 in compensation and interest on her £19,832 of arrears? Secondly, will the Government also follow the ombudsman’s recommendation to provide remedies to the others who have suffered injustice or hardship as a result of the same maladministration?

[The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office and Department for Work and Pensions (Baroness Stedman-Scott) (Con)]

I will go back to the department and check the first point that the noble Baroness raised. This situation is appalling and awful, and I apologise to all those affected on behalf of the Government and the department. I can confirm that Ms U has had a £7,500 compensation payment and a further payment of interest on the benefit arrears payment of £19,832. There is little more that I can say about her, other than that we have complied completely with the PHSO’s point.

On others affected—and I understand the depth of feeling on this—the department has a discretionary scheme that allows special payments to be made to customers to address any hardship or injustice caused by DWP maladministration. Consistent with other large-scale LEAP exercises, special payments under the DWP discretionary scheme will not routinely be made. There is no legal requirement to make special payments as the scheme is discretionary. However, as the Minister for Welfare Delivery said in the other place on Thursday, if anybody believes that they are a special case, they are quite free to make representation to the department.

State Pension Age

Baroness Sherlock Excerpts

Tuesday 18th January 2022 Lords Chamber

[Baroness Stedman-Scott (Con)]

Since 1994-95, rates of female pensioners in poverty, by all measures, have fallen by a larger amount than rates of male pensioners in poverty over the same period. The proportion of pensioners in absolute poverty, after housing costs, has halved since 2002-03. Pension credit is the safety net—I know that will open the floodgates for a raft of other questions—and we must make sure that as many people as possible apply for that benefit.

[Baroness Sherlock (Lab)]

My Lords, I cannot let that go: relative poverty among pensioners is on the rise again, having fallen considerably for years. However, controversially, I will come back to the Question. The latest ONS tables show that life expectancy at birth in the UK is 79 for men and 83 for women. But life expectancy is lower in Wales and Northern Ireland, and especially Scotland, than it is in England. What are the Government doing to engage with the devolved Administrations, and how might pension policy take account of that?

[Baroness Stedman-Scott (Con)]

I hope that, during the review, the devolved Administrations will be consulted. I will certainly go back to the department and speak to the Secretary of State to make sure that that is included in the review. The review will then report, and the noble Baroness will get the answers that she is looking for.