Homeless People: Night Shelters

Debate between Lord Avebury and Lord Freud

Tuesday 11th June 2013 Lords Chamber

[Lord Freud]

My Lords, there are approximately a quarter of a million people living in overcrowded accommodation and 1 million spare bedrooms in homes lived in by people who receive benefits in the social rented sector.

[Lord Avebury]

My Lords, the noble Lord said that this was an isolated incident, but is he aware that local authorities are already cutting off housing benefit and that shelters are closing down? When will Homeless Link and Crisis have a reply to the representations that they made to DWP asking for an urgent clarification of this ruling?

Mesothelioma Bill [HL]

Debate between Lord Avebury and Lord Freud

Monday 10th June 2013 Grand Committee

[Lord Freud]

My Lords, these amendments look to allow for legal fees to be paid by the scheme without limit. Amendment 17, tabled by the noble Lord, Lord Howarth, looks to reimburse in full all legal costs incurred either through applying to the scheme or through bringing proceedings against an employer or insurer. The noble Lord, Lord Howarth, has also tabled Amendment 28 to cover the cost of legal advice obtained in respect of appeals to the First-tier Tribunal. Amendment 42, in the name of the noble Lord, Lord McKenzie, and the noble Baroness, Lady Sherlock, also seeks to cover any legal costs, including the cost of appeals.

The introduction of the scheme is aimed at making the receipt of payment as quick and simple as possible. The amount that a successful scheme applicant is paid will include an amount for legal costs. This will be a fixed amount and will be included as part of the scheme payment received by an applicant and specified in the regulations. In the impact assessment, we used the working assumption of roughly £7,000 to go towards legal fees for each successful application. Since then, we have revised the numbers, using the working assumption of £2,000. The final amount will likely fall somewhere between the two. For clarity, the schedule will show the amount of the actual payment and the amount of legal fees, which will be on top of the 70% figure, to be absolutely clear in response to the question from my noble friend Lord German and the noble Lord, Lord Howarth.

I reassure the noble Lord, Lord Howarth, that the MoJ and the DWP are at least on the same planetary system—some of the time, anyway. The specific regulations will be laid after the Bill receives Royal Assent. The MoJ will conduct elaborate, complicated consultation. To update the noble Lord, Lord Howarth, on timing—I hear his strength of feeling on this—the consultation will be launched in July 2013, next month, and will contain specific options. Clearly, it is recognised that this is a complex issue. The consultation period will last 12 weeks as it will go through the summer, and the response will be published in the winter of 2013. Some of the issues around the right kind of fixed costs will be dealt with in that consultation.

The aim of the scheme is to make the receipt of payment as quick and simple as possible. In response to my noble friend Lord German’s question about the level of information that is required, the eligibility criteria are specified in Clauses 2 and 3 of the Bill. The scheme is not a no-fault scheme, so the applicant will be required to establish the eligibility criteria. However, they are in practice much simpler and more straightforward than in a civil claim. Rather than go through all the specifics of that, in the interests of time I would prefer to set it out in writing.

The reasons for wanting to set a fixed amount of legal costs that can be recovered by lawyers are threefold. First, it is important that applicants are not charged unreasonable or disproportionate legal costs by their lawyers, as we have seen happen in other instances. Any legal work would be in respect of an application to a statutory scheme, which is non-contentious and much quicker and simpler than civil litigation. Secondly, we hope that fixed costs will deter scheme applicants being pressured into entering no-win no-fee agreements, potentially reducing the amount of scheme payment paid in respect of their disease. Thirdly, it is important that the scheme is not overburdened with high legal costs, which would raise the levy and jeopardise the scheme in its entirety.

In respect of any legal costs associated with appealing to the First-tier Tribunal, if these were to be paid in every case that could act as incentive for anyone who was unsuccessful in receiving a scheme payment launching an appeal, even if the appeal was without merit. This would significantly increase the amount of money needed to fund legal fees, requiring the levy to be set higher. Any significant increase in costs could prevent the scheme being set up. It could also overburden the tribunals system with unnecessary appeals.

[Lord Avebury]

That takes care of the disincentive to bring claims to the First-tier Tribunal that have no merit, but what about the claims that do?

[Lord Freud]

It is important to highlight that higher rights are not required in the First-tier Tribunal or the Upper Tribunal as they are in civil courts. That means that scheme applicants could represent themselves, or that their solicitor could conduct any advocacy on their behalf; they would not need to instruct expensive legal counsel. There will be no legal aid for appeals to the First-tier Tribunal following the review scheme decision unless exceptionally it is necessary to make legal aid available to avoid a breach of an individual’s rights under the ECHR or under European Union law relating to the provision of legal services. This will keep costs to a manageable level.

Picking up on the point about the tribunal system, it is traditionally an inquisitorial rather than adversarial system and is designed to make things easier for those representing themselves. For those who do wish to obtain legal representation, it is hoped that lawyers will charge a fair and proportionate rate. The work will be non-contentious and there will be no defendant as there is in a civil case. The tribunal system is there to assist appellants. There is therefore every incentive for lawyers to carry out work on scheme appeals required efficiently and in a way that keeps costs proportionate.

Picking up the question from the noble Lord, Lord Howarth, on the level of fixed fees, clearly the MoJ consultation will consult on both the principle and the structure of such a regime to support a dedicated pre-action protocol. I hope noble Lords can see the need for pragmatism here—the need to keep costs at a proportionate amount and to protect the money that an applicant receives in respect of the disease from high legal costs, as far as possible. I urge the noble Lords not to press the amendment.

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[Lord Freud]

My Lords, I fully recognise that Amendment 19 is a probing amendment that would remove the possibility of the scheme making payments subject to conditions. It would therefore have the consequence that the recipient of a scheme payment would have full control over the use of the scheme payment.

Let me make the purpose of this part of the clause absolutely clear. In general, we fully expect that most scheme payments will be made to the applicant. This is for vulnerable people who might be mentally incapable of handling their own finances or who are unable to look after their own welfare by attending to basic financial transactions that adults normally carry out for themselves. It is important, therefore, that in those sorts of cases the scheme administrator is able to subject some payments to certain safeguards, such as how a scheme payment is to be used, and to decide when such conditions should be imposed.

We expect the scheme administrator to use this power to ensure that, where appropriate, payment is made to an appropriate person or fund to safeguard the beneficiaries’ interests. I am sure that the one thing on which we are all agreed in this Committee is that we want to avoid the recipient of a scheme payment having unsupervised control over the use of a large sum of money if they are incapable of managing such a sum. However, a number of valuable points are being made about the interplay between primary legislation and regulations, which we will take away and consider. Clearly, the rules are in draft and we will take the points made today as we look over them. With that assurance, I urge the noble Lord, Lord McKenzie, and the noble Baroness, Lady Sherlock, not to press their amendment.

[Lord Avebury]

Perhaps I may ask my noble friend why, if the only circumstances in which conditions are to be imposed are those that he has just outlined, where the recipient of the compensation is incapable of handling his own financial affairs, Clause 15 does not specify those circumstances and thereby reduce the breadth of the wording, which according to him is completely unnecessary.

[Lord Freud]

I take on board my noble friend’s point. As I said, I shall look at this and the other points made by this Committee. The rules are only in draft form, and we may look at them to lock that down.

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[Lord Avebury]

My Lords, I think the Minister said in replying to the previous amendment that when we came to this one he would give us some more information about the membership of the body that the industry proposes to establish. It would be very useful to know that, as it conditions the way we will think about monitoring and reviewing. Clearly, if the board established by the insurance industry contains people who have an association with that industry, the degree of intensity of monitoring and reviewing would have to be far higher than it would if the board were totally independent.

[Lord Freud]

To answer in just one minute: I will take the whole package and look at it. That is what I am committing to do.

Mesothelioma Bill [HL]

Debate between Lord Avebury and Lord Freud

Wednesday 5th June 2013 Grand Committee

[Lord Avebury]

My Lords, I am glad that these things happen to other people as well as to me. The Deputy Chairman need not apologise because everyone, however careful they are with their diaries, makes these mistakes from time to time. I missed an appointment myself this morning and I am still smarting from it.

On Second Reading, the Minister said that the Bill would establish a payment scheme to make lump sum payments to eligible sufferers from mesothelioma and their eligible dependants but he later amended that and said that it was a means to create such a scheme. Clause 1 gives the Secretary of State power to create, amend, replace or abolish the scheme within the certain broad parameters referred to in Clauses 4, 5, 6 and 10. Parliament has no say in the details of the scheme or in any variations made to the scheme, although of course it does on the regulations that are made under the Bill.

My noble friend Lord German and I both commented on this at Second Reading but the Minister evidently did not consider it important enough to pick the matter up in his winding-up speech, nor is there any explanation of the drafting in the Explanatory Memorandum. We are merely told that the clause confers these wide-ranging powers on the Secretary of State without saying why Parliament is excluded from all these processes.

If the Government consider it necessary to make changes in the system of employer’s liability insurance under the 1969 Act, obviously they have to come before Parliament and seek approval, as they did for the Act itself. Under this Bill the amount of any payment is determined by regulations, but in Clause 4 there is provision for the payments to be made subject to conditions, or for the payments to be repaid in whole or in part in specified circumstances. Again, these decisions are the sole prerogative of the Secretary of State. Similarly under Clause 5, the procedure for the making and deciding of applications is part of the scheme issued by the Secretary of State without having to obtain parliamentary approval.

There are further provisions relating to the scheme in Clauses 6 and 10 which are left to the unfettered discretion of the Secretary of State. These may not be in the best interests of claimants—we simply do not know—and it would be helpful if my noble friend could say whether, before any of these decisions, drafts will be published for consultation with the stakeholders. In the period leading up to the publication of the Bill, the Minister told us at Second Reading, there were 15 meetings with the insurance industry and 11 with representatives of victims’ groups, lawyers and members of the APPG. If the Government had to come back to Parliament they would have some incentive to continue with these consultations on the scheme and on the amendments to it which may be made in the future.

I hope that my noble friend can assure us that there will be no private consultation with the insurance industry excluding organisations representing the victims of mesothelioma. According to the Guardian, firms with insurance interests have given the Tories nearly £5 million since Mr Cameron became leader of the party. I am sure that the Government would not like it to be suspected that the industry’s largesse entitled it to any special favours. Your Lordships will bear in mind that all firms providing employer’s liability insurance have a vested interest in ensuring that, as far as possible, the details of the scheme create as light a burden for them as they can achieve. If, however, the industry passes on the costs to customers, as the Data Monitor survey quoted in paragraph 97 of the 2013 impact assessment suggests, it might be more impartial if it is asked to comment on a draft before the scheme is published.

The Delegated Powers and Regulatory Reform Committee says that this scheme is comparable in structure and content with the one governing a discrete, targeted social security benefit. It concludes that,

“only a most compelling explanation could justify the establishment of a scheme that is to determine rights to statutory payments, yet is not to be subject to any form of Parliamentary scrutiny”.

That says it all. I beg to move.

[Lord Freud]

My Lords, before there are any other contributions on this topic, it might save time if I respond rapidly to the last point mentioned by the noble Lord, around Amendments 1, 2, 4 and 5, about establishing the scheme on a statutory basis. Clearly that is the recommendation of the Delegated Powers and Regulatory Reform Committee. We acknowledge the concerns behind it. In the time between the recess and the Committee stage it has not been possible to do more than consider the proposed changes to the Bill. I am sure that noble Lords understand exactly what I am saying. I understand their concerns about the means by which the scheme is established and we are giving the matter due attention. I hope that those remarks might save a little time today.

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[Lord Avebury]

My Lords—

[Lord Freud]

Is the noble Lord—

[Lord Avebury]

I was going to withdraw.

[Lord Freud]

Ah, I might say a few words. I hope that in my earlier intervention in the interests of saving a little time I effectively dealt with our approach on Amendments 1, 2, 4 and 5. I will turn to Amendments 3 and 6 in the name of the noble Lord, Lord Howarth.

Amendment 3 requires that before the scheme is established,

“the Secretary of State shall publish his proposals and make a statement to Parliament about them”.

This falls into the area of the recommendations from the Delegated Powers and Regulatory Reform Committee to make the scheme rules subject to negative resolution. The result of those considerations may serve to enhance in practice the level of parliamentary scrutiny, which would make this amendment unnecessary.

One or two questions were raised. I apologise for the late arrival of the scheme rules—everything seems to be just in time today—but I was keen to get them to Committee Members before we started. Of course, we will have another day of Committee, and further stages. They are a draft at this stage and a work in progress and we will be continuing to refine them during the passage of the Bill and indeed afterwards.

I ought to deal with the question from my noble friend Lord Avebury on the meeting with the insurance industry. Bluntly, this was a negotiation with the insurance industry and you have to meet people to negotiate with them. To get a working scheme going, that was an essential job. I would have liked to have done it with rather fewer meetings, but that is what it took.

Amendment 6 requires that:

“The Secretary of State must report annually to Parliament on the performance and progress of the scheme”.

I argue that it is not necessary to include this in the Bill. Scrutiny and reviews are already planned for the scheme without the need to include those in legislation. Indeed, we cannot know at this stage whether it is necessary or appropriate to report annually. We are aiming to determine the details of the reviews at a later stage. I am happy to commit to making a Statement to the House on the scheme’s performance. We will keep this under review as, over time, we expect the volume of scheme cases to reduce and for further information on the schemes to be readily available. The kind of information that the noble Lord, Lord Howarth, was talking about may become transparent effectively on a daily basis. I urge the noble Lord, Lord Avebury, to withdraw his amendment.

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[Lord Freud]

My Lords, the difficulty in doing such a negotiation is that this was pretty price-sensitive stuff in the marketplace. We had to keep it tight. I did, however, explore the angles without being specific or laying it out by saying, “Here is the architecture”. I explored the elements of what we were aiming to do with, as I say, not just the victims’ groups but the lawyers and the APPG. Keeping a balance between a commercially complicated deal and ensuring that the other side is well informed is always difficult, but that is the balance that I tried to strike.

[Lord Avebury]

My Lords, I certainly was not objecting to the meetings that were held with the insurance industry in the lead-up to the Bill. I mentioned that at Second Reading the Minister told us how many meetings there had been not just with the victims support group but with various other stakeholders, such as the lawyers representing the victims. I had hoped that those consultations would have been extended into the period when the details of the scheme are being formulated. We would hope that there would be equality of arms between the insurance industry and the representatives of the victims in designing the details of the scheme and in looking at any amendments that may be necessary later on. However, we have to be content with what the Minister has said this afternoon and hope that, at least by Report, we will be looking at something a little more concrete than the Minister was able to say to us. In the meanwhile, I withdraw the amendment.

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[Lord Freud]

My Lords, there is a deep and difficult history to this of which, I suspect, everyone in this room is aware. We are trying to ensure that we can get money to that group who have missed out. I am as dismayed as many of your Lordships that that has not happened earlier, but we are where we are. We are doing it now in a way to ensure that we can get those payments flowing rapidly. I apologise if I seem to be making a Second Reading speech. The problem is that this is such an emotive issue—the disease is so horrible—that it is very hard not to do so.

We have to come back to what is a specific deliverable. It is awful to sound so legally defensive, as I know that I am sounding here, but I am trying to get a deliverable, to get as much money as possible to people. I shall answer the specific questions. I know that I will not have the noble Lord, Lord Howarth, resounding with pleasure, as he wanted to be, but that is the underlying reason. My motivation is to get as much money as I possibly can safely, without risk—legal risk, in particular—to people.

[Lord Avebury]

I am sorry to interrupt my noble friend, but was it always clear whether a person was covered by the employer’s liability insurance? In the industries which have been mentioned, such as the construction industry, where the boundaries between the employed and the self-employed were not always clear, and a person comes forward and claims that he worked for such and such a firm and was employed at the time, but the employer’s liability insurance has been lost, how can the scheme be satisfied that he was qualified within the terms of the Bill?

[Lord Freud]

That is a very important point. As the noble Lord, Lord McKenzie, was querying, some people will appear to be self-employed where the reality is that that was an artificial, tax-driven construct. In that case, if they can demonstrate that in practice they were acting like an employee, they would be eligible for a payment under the scheme. That is specifically allowed for.

The noble Lord, Lord Howarth, asked about estimates of exposure to people who have been washing laundry—secondary exposure in the household. We do not have those data, I fear. We have data on general environmental exposure, which would include that, and I can give that information to the noble Lord. Clearly, people who catch asbestos outside the employer liability framework can get payments under the 2008 Act. Various noble Lords thought that they were inadequate, but they are state payments established since then.

My noble friend Lord James asked about the MoD and the Admiralty in particular. The state does not have employer’s liability—

Child Poverty

Debate between Lord Avebury and Lord Freud

Tuesday 26th June 2012 Lords Chamber

[Lord Freud]

My Lords, there is a lot of debate about how to measure poverty. I believe that relative income measures have an important place, as do absolute measures, but it is quite true that we need to have strategies that go to the fundamentals that create poverty rather than worrying about trying to ameliorate those by income transfers. It is more important to have a balanced strategy.

[Lord Avebury]

My Lords, why do the Government refuse to extend the pupil premium to Gypsy, Roma and Traveller children who are the worst achievers in all sectors of education, whether measured by achievement, attendance or exclusions? Surely that group qualifies as being the most deprived of all in our schools.

[Lord Freud]

My Lords, I will pass that view on to the Department of Education.