Welfare Reform Bill

Lord Wigley Excerpts

Wednesday 16th November 2011 Grand Committee

[Lord McKenzie of Luton]

I thank the Minister for that statement. It is very helpful in being able to schedule and make progress on Report.

[Lord Wigley]

My Lords, as I was saying before I was interrupted a couple of days ago, these amendments touch on a critical consideration—namely, the need to ensure that those making assessments can identify factors that may make it difficult to engage meaningfully, fairly and objectively with the applicants: disabled people, whose condition of course fluctuates, as has been mentioned already, and for whom communication itself is often a challenge.

Nowhere is this more evident than among those whose difficulties arise from the autistic spectrum of disorders. As was pointed out by the noble Lord, Lord Touhig, on Monday, on the autistic spectrum not only are no two people the same, but the same person may exhibit different characteristics over a period of time.

The Minister will, I am sure, have noted from Monday’s debate that many of those who contributed—the noble Lords, Lord German, Lord Addington and Lord Touhig, and the noble Baronesses, Lady Howe and Lady Healy—highlighted the challenge of proper assessment in the context of autism. The noble Baroness, Lady Healy, emphasised the need for assessors to have specific training in autism, and access to expert champions. The noble Baroness, Lady Grey-Thompson, who moved the amendment, warned of the dangers of incorrect decisions where assessors base their conclusions on face-to-face interviews without professional knowledge and without experts’ evidence. Given the extent to which autism factors have run through this debate, may I urge the Minister to address the points raised in that autism context?

In particular, I urge the Minister to ensure that in dealing with problems of face-to-face assessments, safeguards be written into the Bill, so that wherever there is ample expert written evidence available, applicants do not have to go through unnecessary face-to-face assessments. The Bill should stipulate that all assessment will take into account expert reports and evidence as a first tier in that assessment process.

Secondly, there should be a requirement that those undertaking assessment have appropriate training, including in autism. This is something about which Autism Cymru, the organisation in Wales, feels particularly strongly. Also, in every assessment centre there should be available to assessors appropriate experts or champions in mental, intellectual or cognitive disabilities, including autism.

The third point I want to underline—and these have all been raised in different ways by noble Lords who have contributed to this debate—is that the Bill and regulations must specify that parents and carers are categorically allowed to support disabled individuals at every stage in the assessment process. Those without such support should be told of their rights to an independent advocate.

Finally, I turn to the position of lifelong awards in the context of Amendments 86F and 86G, to which I have added my name. The Government have said that they want all awards to be for fixed terms apart from in exceptional circumstances, and that there will be some sort of built-in review process. Surely the Minister must realise and accept that there will be people who are sadly not exceptional, whose condition is a lifelong one and for whom the worry and uncertainty of regular reviews are an unnecessary imposition, the cost of which is a waste of public money. Does not all common sense say that those with a degenerative disease, for example, should not have to face repeated assessments? In this group there are more than 300,000 adults, as I understand it, with autism, whose core condition will not change; there are some 70,000 with MS and 20,000 with Parkinson’s disease, whose condition is incurable. Retesting these people is no more than pandering to the tabloid agenda we heard about in the last sitting.

I urge the Minister to take on board these amendments and to facilitate lifelong awards where appropriate.

[Lord Low of Dalston]

My Lords, I have put my name to Amendment 86ZB in this group. These amendments, which would dispense with a face-to-face assessment where there is appropriate written evidence, have considerable overlap with Amendment 86ZZZV in the name of the noble Baroness, Lady Campbell, in the next group. So, if I may, I will say what I have to say on the matter now and spare the Committee the repetition when it comes up later especially since, with apologies to the Committee, I have to leave for the airport at 3.15 and may not be around when we come to the later discussion.

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I hope that I have reassured noble Lords that the assessment process will be sensitive, proportionate, personalised, based on sound evidence and delivered by individuals with the right skills, training and support. On this basis, I urge the noble Lords and the noble Baroness to withdraw their amendments.

[Lord Wigley]

Before the Minister sits down, he mentioned the possibility of developing in conjunction with the National Autistic Society an initiative to augment training. Is he aware of the scheme that has been running in Wales, under the autism plan that was adopted by the Government of Wales, with training work undertaken by Autism Cymru with Careers Wales and to some extent with Jobcentre Plus itself? Last February, an online booklet was published for Careers Wales and Jobcentre Plus, and there were similar publications on autistic conditions relating to the advocacy service and GP practices. Are these the sort of initiatives that the Minister sees being developed in conjunction with the National Autistic Society?

[Lord Low of Dalston]

Before the Minister concludes, I am sorry if I was not paying attention, but I did not hear him respond to the points made about our amendment about cases where the written evidence was clear and unambiguous, where there were very high levels of need which, the nature of the impairment made clear, were unlikely to change. I heard the Minister say that the assessment process would be implemented with flexibility, but my impression was that the avoidance of a reassessment would be a pretty exceptional situation. Those of us who support Amendment 86ZB believe that cases where people's circumstances are unlikely to change and their high levels of need have been unambiguously and unequivocally evidenced are not isolated exceptions. That is a widespread and general circumstance. Can the Minister respond a bit more positively on that?

Welfare Reform Bill

Lord Wigley Excerpts

Monday 14th November 2011 Grand Committee

[Lord Sassoon]

I do not believe that there is any question of the Government being sued. The matter is clearly regrettable. The error was not spotted by anybody either inside or outside HMRC until August, when a technician in HMRC spotted it. It was not spotted by any of the numerous parties who no doubt crawled over this technical area, and it is now being corrected at the earliest practical time. Therefore, there is no question of the Government being sued by anybody—but it is important that we correct the technical error.

[Lord Wigley]

I thank the Minister for that answer, but I will pursue one point. He made the point that nobody spotted this—including, by implication, opposition Members. Nevertheless, it is not opposition Members who are running HMRC. Has any disciplinary action been implemented over this mistake?

[Lord Sassoon]

My Lords, if the technician who spotted it was not part of the original drafting, he or she is to be congratulated. I was not making a point about the Opposition; I was merely pointing out that this is a highly technical area that escaped everybody's notice for a considerable amount of time. What is going on now is that HMRC has introduced new procedures to make sure that the checking process that it will go through for these things in future will mean that there will be a significantly reduced chance of anything like this slipping through again.

[Lord Wigley]

My Lords, will the Minister confirm that people who had an entitlement under the law as it stood will be paid fully in accordance with the law as it stood, and that there is no question of a clawback coming through retrospective legislation?

[Baroness Hollis of Heigham]

It is worse than that. Money has been taken from people. The thrust of the noble Lord’s argument suggests that it should be repaid until it has been appropriately legitimised.

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[Baroness O'Loan]

My Lords, I support the noble Baroness, Lady Campbell. The proposal to amend Clause 75 by changing the name “personal independence payment” to “disability living costs allowance” is intended to clarify the purpose of the payment. However, it does not reflect the way in which understanding of that issue has been developed. “Personal independence payment” has come to suggest that the disabled person is or will become independent as a consequence of the payment. That will not happen. What will happen is that the person will be able to finance the inevitable additional costs that are consequential on their disability or disabilities and the various barriers which hinder full participation.

Independence is about not being reliant on others. The reality for those with disabilities is that they will always need assistance for a range of activities. The cost of that assistance is an additional resource which the disabled person needs. The DLA provides for those costs, and under these arrangements the payment of these additional costs will be enabled, not independence itself.

We are acutely aware of the extent to which people entitled to benefits are unable to claim because of lack of knowledge and understanding of their rights. That is a proven fact, despite the coverage to the contrary. It is most important that the name of this benefit does not have the capacity to add further confusion for the beneficiary. It has been recognised by government that people do not fully understand what DLA is for. It has also been recognised that disability benefit entitlement should be easier for people to understand. I therefore believe that the term “personal independence payment” is not adequate or appropriate.

The aim of the DLA was always to enable a disabled person to experience as full a life as possible and to provide for the additional costs. That approach recognised the reality that independence as others experience it is never going to be a reality for a person with a range of disabilities unless additional funding is made available to enable the access to education, to social and political life, to employment or, indeed, to membership of this House if that is what the person aspires to.

I travel regularly by plane, train, underground, bus and all forms of transport which are profoundly difficult and sometimes inaccessible for those with disabilities. Access to transport continues to be at a very low level, and therefore the use of taxis or cars involving significant additional costs is the only option available in many circumstances. Access to some buildings is still impossible for people with mobility problems. I share an office with someone who has a disability and so I am aware of the endless conversations that ensue on an invitation. Those questions include, “Can I get access to the building? Can I get into the event? How will I get up the steps?”. Other problems arise for those who suffer from deafness and learning disabilities in terms of access to the content of material. That has to be provided for and it costs money. Surely we should recognise this and make quite clear what the allowance is intended to enable: simply, the payment of additional costs.

[Lord Wigley]

I rise with some humility to follow the noble Baronesses who have moved and spoken to these amendments. Reference has been made to the battles that took place in the 1970s, the 1980s and the 1990s to try to make progress on this issue. A number of noble Lords here today were involved in the various stages. I look across the Committee Room and see the noble Lord, Lord Newton, who was very much involved from the Government’s point of view and was there when progress was made. The battles were partly with regard to the substance and content of the legislation to ensure that resources were available for those in need. However, alongside that, there was a battle to ensure that the terminology was appropriate. We know that in so many areas of disability there have been changes in the conventional acceptance of terminology. To a very large extent that has been driven by those with disabilities themselves. Many of us have had to adapt to that terminology, coming to realise what it means. The terminology is important not only to disabled people themselves but to the rest of society because of the perception society has of the challenges of disability. One therefore wants to make sure not just that the terminology is neutral but that it works positively to help those most affected by it.

The noble Baroness, Lady Lister, referred a moment ago to the fact that the amendment is not asking the Government to make an expensive provision. We have heard from the Minister speaking to many, many amendments in this Committee that the cost has to be a factor and we all understand that. In this instance, it does not appear that the cost has to be a factor and if the Minister can find some way to accommodate the terms of these amendments, I believe it would do an awful lot of good at very little cost.

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[Lord Newton of Braintree]

I got it nearly right, but it is still quite a lot of people. In that case, my question to the Minister is: what steps does he expect to take—it may be that this is already clear and I just do not know—to protect people who are already receiving DLA at the point of transition? We are talking about sums of money that, although not large to many of those in this Room, can be very large indeed to some of the people who are receiving them. One of the things that I always had in mind—I think at one stage my then Cabinet colleagues occasionally referred to it as “Newton’s law”—is that not giving somebody something is quite different from taking away from somebody something they already have. I would like to hear my noble friend’s comments on that.

The other thing is also, in a sense, a question directed to the Minister, although it may also have occurred to the noble Baronesses and others who are interested in this. It is the reference in the Bill and in this amendment, which follows the Bill, to a person’s ability to,

“carry out daily living activities”,

being limited by,

“the person’s physical or mental condition”.

I would like to say a word or two about how that is to be done. In my day, which some in the Room will remember, we had a benefit called the housewives non-contributory invalidity pension, which entailed a lot of tests, that were regarded as demeaning and humiliating in the extreme, about whether somebody could boil a kettle or take a tin off a shelf. I think there were others, to judge from the reaction of the noble Baroness, Lady Wilkins, who will remember them. I would not want to get back into that. Indeed, I got rid of it. I hope that we may have a word that there will be a more civilised way of assessing the ability to carry out daily living activities than is revealed on the surface of the Bill.

[Lord Wigley]

If the Minister accepts the figure for those who will lose relatively small sums that are of critical importance to them, and if the services that they have been able to purchase or the benefits in their life that they have been able to obtain by virtue of having that money now have to be found through some other means, has some assessment been made of the additional cost that may be going elsewhere in order to ensure that they do not lose out on aspects of their lives that are critical for their day-to-day existence?

[The Countess of Mar]

My Lords, I think the noble Lord, Lord Newton, put his finger on the button in his first comments. It is people’s fear of what is going to happen when they have a medical examination. Many of them have already had experience of DWP medicals, and from the correspondence I have had they are extremely distressed about what is going to happen to them in the future. It may be that they are dramatising, in which case we would be very pleased to have our minds put at rest, but on the other hand, if we are making this 20 per cent cut in expenses, they are bound to be frightened because these are people at the bottom who are going to be chopped off, and they do not understand how the process in going to happen.

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[Lord Freud]

My Lords, I will give a full report on Wednesday, but I have already indicated where I am pretty sure we are. We are looking at passporting in a much wider way. We are having the SSAC report in January with its recommendations. There will undoubtedly be a lot of work around that. It would indeed be foolish to look at one aspect of passporting without taking the whole of passporting together. As noble Lords know, this is a framework Bill. There will be plenty of time to consider all these elements as we go through the regulations when we will be doing things in the fullest possible way. I imagine noble Lords in this Room will be taking a very full interest in all these aspects. Let me leave it that I will come back with the timetable at our next sitting.

These amendments seek to broaden the scope of PIP—I do not know whether my noble friend’s formulation of the personal disability costs payment has found favour, but I will stick with PIP, like the noble Baroness, Lady Hayter, for the purposes of this—by introducing an additional tier to the daily living component. When we consulted on the overall framework to personal independence payment, we stated our intention to move to a structure that has two components paid at two rates. We decided on this structure for three key reasons: to simplify the overall structure by reducing possible award outcomes from 11 to eight; to make it easier to understand and administer; and to ensure that it reflects the range of individual needs and provides appropriate levels of support.

We also made it clear that the overall design of personal independence payment is intended to ensure that the benefit is fairer, more transparent and focused on the individuals who are least able to live independently. It also provides an affordable and sustainable platform of provision for the future.

In responding to our consultations, most organisations said that they supported the move to broader definitions for both components as they were a better reflection of the real experience of disabled people’s daily lives. Our view, therefore, is that a daily living component paid at one of two rates will enable us to better reflect the impact of impairment on an individual’s ability to participate. I appreciate the concerns of the noble Baroness that people will receive lower levels or no support under our reforms and that her amendments are intended to prevent that. However, that fails to deal with one of our fundamental aims, which is to give more consideration to whom we prioritise for support.

The Government have been clear here. We intend to protect those who are most in need and will prioritise support for individuals whose impairment has most impact on their ability to participate. That aim, and the way in which we intend to deliver it through the new assessment criteria, may necessarily result in shifts in provision. Some people will receive more support under our proposals; some the same; and some less. This is not an exercise in simply making arbitrary cuts to existing provision; it is about refocusing benefit provision so that it reflects disability impairments and barriers to participation in the 21st century.

[Lord Wigley]

The Minister mentioned a shift in provision. Did he look at the responsibility falling on other people? I am thinking particularly of it falling on social service departments of local authorities.

[Lord Freud]

My Lords, clearly an enormous amount of work has been done on this within both government and consumer organisations. When we refine the criteria—which is the process that we are going through—we look at all those aspects to ensure that we focus the money on where it will have most effect in supporting people to live independent lives.

On the question raised by the noble Baroness, Lady Grey-Thompson, on how we will assess people, the version of criteria that we published on Friday looked at a range of key, everyday activities. The main question is to look at what support an individual needs. It is much more holistic than the test described by my noble friend Lord Newton of how to boil a kettle. Our testing results through the summer demonstrated that our approach is both reliable and valid. On the question raised on the cost of getting evidence from GPs, we are discussing PIP plans with the Department of Health but have not yet made any estimate of the specific costs of obtaining evidence from GPs. However, evidence gathering will be a critical part of PIP and we recognise that disabled people will want to present information from a wide range of sources, not just GPs. We will ensure that they are able to do this.

Let me pick up the point made by the noble Baroness on the 652,000 so-called losers. That assumes that all the people currently receiving the lowest rate of DLA care would receive nothing under the PIP. We have not yet completed the detailed assessment of the impact of our changes on the current DLA caseload, and will do that on Report. It is likely that we will see significant movement in the new benefit. I suspect that some people will receive more support because of the improved assessment; some will receive broadly the same; some will receive less; and some will leave benefit altogether. The most important thing is that these results should accurately reflect the level of need of the individuals concerned so that the money will go where it is most needed. From what we have seen so far, the draft assessment is working to achieve this.

In the proposed criteria we have demonstrated that we have not simply removed the lowest rate of DLA. The concepts of needing assistance and how individuals prepare food, as described by the noble Baroness, Lady Hayter, are very much part of the criteria. We are aiming to ensure that passports to provisions elsewhere, such as vehicle excise duty exemption and the blue badge scheme, continue. Where necessary, we are working with other government departments and the devolved Administrations to ensure that the new PIP arrangements match closely their arrangements to ensure continued support for disabled people. It is our intention that the personal independence payment will provide part of the gateway for receipt of carer’s allowance in the way that DLA currently does. I have dealt with the timing issue.

In conclusion, let me assure the noble Baroness that our proposals to move to a two-tier daily living component is not about reducing support or cutting costs. It is a principled move that will help us deliver a benefit that will focus on those least able to participate. It will do that in a way that will make it fairer, clearer for everyone to understand, simpler to administer, and affordable and sustainable into the future. The Government have spent a considerable time developing and consulting on the provisions that the noble Baroness wishes to amend. Our view is that they are the right way to progress our aims. I therefore cannot support the amendment and I urge the noble Baroness to withdraw it.

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[Lord Low of Dalston]

My Lords, I realise that I should have apologised to the Committee earlier for having taken no part in the debates on this Bill heretofore, then turning up on day 13 and contributing to practically all the debates. I hope that this will be regarded as making up for lost time rather than trespassing on the good will of the Committee. I would have been here for day 11 when contributory ESA was discussed at considerable length, but unfortunately I was away last week and therefore not able to do that, however keen I was to do so. However, I hope that I will be able to make up for lost time on that when we come to Report. There was certainly a lot to get one’s teeth into in the report of the debate on contributory ESA held on day 11, which I have already begun to study with care, but it is quite technical so it will need more study—I can see another weekend or two going on that.

I turn to the matter in hand. I certainly want to support the amendment moved by my noble friend Lady Campbell. People vary in the extent to which they regard the social model of disability as another holy grail of disability policy and in the extent to which they regard the barriers erected by society as opposed to medical factors as accounting for the bulk of a disabled person’s difficulties. I confess that I am inclined to allocate a bit more significance than some to the so-called medical factors—those to do with the individual and their impairment. But this amendment is moved in impeccably moderate terms. Its purpose is simply to ensure that the assessment process for PIP takes into account the full range of factors—social, practical and environmental as well as medical—that disabled people face. No one could possibly disagree with that, and I am sure that the Minister will tell us that he does not either.

In introducing PIP, the Government have stated their commitment to support disabled people to overcome the barriers they face in order to lead full and independent lives. If that is the case, the assessment should assess the full picture of the barriers that disabled people face in their everyday lives, and putting this amendment in the Bill would help to ensure that the assessment process took that form.

[Lord Wigley]

My Lords, I regard this as one of the most important amendments we are considering because of the importance of the message it carries. If we were alive then, most of us remember where we were when President Kennedy was shot, or when 9/11 occurred. I remember exactly where I was when I first came across the social definition of disability. I was in Sweden, it was 30 years ago this year, and it was the International Year of Disabled Persons. I was in the process of trying to get a disabled person’s Act on to the statute book in the House of Commons. With the support of a number of people here, we were successful. In fact, the noble Lord, Lord Low, gave me a considerable amount of help outside the Chamber at the time.

The definition was put to me in these terms, which I still carry in my mind. Handicap is the relationship between a disabled person and his or her physical, social or psychological environment. By medical intervention, we may or may not be able to do something about the basic disability, but our ability to amend and adjust the environment can prevent disability becoming a handicap. In those terms, it is glaringly clear where responsibility lies to minimise the degree of handicap that people, for various unfortunate reasons, whether accidental or congenital, have to face as the consequence of disability. It is the responsibility of any Government in any civilised country to have that at the core of their approach to disability politics.

I am not certain of the extent to which the words in the amendment will change the thrust of policy, but I am certain that the commitment to this approach must be central. If we have that commitment at the heart of our thinking, other decisions in this Committee and in later stages will work out for the benefit of disabled people.

[Lord Addington]

My Lords, the social model is something that anybody who has been involved in disability for any length of time has been searching to get hold of and use more correctly. I remember that when we did the Disability Discrimination Act, we had a variety of people coming in to see the committee, and it became my role in that committee to ask for a workable definition, which I failed to get from those groups at the time. We have moved on and are getting better. This is a step forward. We are building an agreement here, and I look forward to what the Minister says about it. This is something on which we might be able to admit that there is a continuation of government policy over various Governments. There has been a continuation of agreement on this over many subjects among the parties and across all political barriers. Implementation may change slightly over the years, but growth and consensus have been built up.

It will be very interesting to know how the Minister sees this approach being built into a variety of other subjects later on in the amendments on this part of the Bill, because that will allow us to assess how deep the thinking has been. It is very easy to say, “Of course we’ll do that”, and it has been done. We have all fought many smaller battles on disability over the years because somebody has said, “Oh no, that’s the way we do it”. One of the most recent ones I have been involved in, which I hope is coming to a happy outcome, is, “Oh, you’ve got to be able to spell to an acceptable standard to become an apprentice”. I have bored many people in this House with that over the past few months. They did not quite take on board that the use of language can be through various means. The electronic devices in front of you mean that you can transfer written meaning—text to voice, voice to text and back again—in various ways and have been able to do so for well over a decade. The people who have got involved in this—the people who were writing legislation at that point—were just out of touch with the reality and the perception of those other people who do not share the mainstream. They were interacting with one aspect.

If we can get a definition of how that is coming in, not so much for this amendment but to throw into a couple of others, we will all be a little happier. If you have a wonderful, magical definition that we can put into a Bill, I will cheer.

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[Baroness Healy of Primrose Hill]

My Lords, I will speak to Amendments 86ZZA, 86ZA and 86ZB in my name. First I will say a few words in support of the amendment of the noble Lord, Lord German. It is vital for adults with autism spectrum conditions to have this right. It is essential that a claimant whose disability impedes communication has an advocate to help them understand the meaning of questions fully and provide accurate answers. The condition also means that many claimants with autism experience high levels of anxiety. A known advocate would be a reassuring presence in an interview.

An autistic adult may have communication problems that are not obvious to the interviewer. That their answers could dictate whether they get the support they need purely on the grounds that they did not adequately understand what was being asked would be very unfair. Judging by the Explanatory Notes to the new draft regulations, which suggest that a claimant can bring another person to a face-to-face assessment, the Government might be sympathetic to the need for such support. However, without clear rights and duties to ensure that advocates are involved, there is no guarantee that such an advocate can attend, translate at and participate in the interview. Therefore claimants must be explicitly informed of their rights, and it cannot be left to the discretion of the assessor.

Amendment 86ZZA, which was tabled by the noble Lord, Lord Addington, and has already been mentioned by my noble friend Lord Touhig, is about the need for adequate training for assessors. I strongly support it. It is important because it is a safeguard against the fear of many parents that their autistic adult children will not be understood and that the wrong decisions will be taken about their needs and their ability to work. Families from the ACT NOW campaign group are very concerned that inadequately trained assessors will not understand the complexities of autism. They also believe that the government target to reduce expenditure on DLA by £1 billion will seriously prejudice individual discretionary decisions.

Although I welcome the Government’s acceptance of Professor Harrington’s recommendation that there should be mental, intellectual and cognitive champions in each medical assessment, I hope that that will also apply to the assessment of DLA—which possibly may become PIP—and that assessors will have training in autism as well as specific understanding of the limits of their knowledge and will know when to ask for expert advice. It should also be possible for assessors to have access to an expert champion to provide that advice.

The amendment would guarantee the safeguard of properly trained assessors who will have access to the necessary range of medical and psychological expertise. It is about ensuring a standard, regularised system of excellence that will deliver a high-class public service across the country. Families that have been through so much in trying to ensure that their children will be able to live independent lives need to know that the Government acknowledge their concerns and will not leave their child’s future well-being in the hands of inadequately trained and inexperienced assessors whose judgments could result in disastrous consequences. Families are concerned that if, as a result of the proposed 20 per cent cut, the new benefit focuses only on those with the greatest needs, their adult children with autism, who perhaps are unable to access social care support, will also lose this key benefit because of misjudgments by assessors who may be expected to take decisions influenced by the pursuit of targets that have been designed to reduce costs and the number of people on benefits.

Finally, I support the amendments tabled by my noble friend Lord Touhig to allow claimants not to be put through face-to-face assessments where it is possible to determine the claimant’s entitlement to benefits on the basis of available medical or social care assessment evidence. Interviews and other similar kinds of encounters may cause people with an autism-spectrum condition severe mental anguish. It is not the nervousness or anxiety that we may experience at the approach of a difficult or unpleasant event, but dread and terror. A person with autism has autism for life, as my noble friend pointed out. It is surely unnecessary to repeat a PIP assessment every few years. For many, it will be needless cruelty. A mother of a 20 year-old man with Asperger’s said of his medical assessments, “I think the whole process is completely overwhelming for people with autism”.

The amendments seek to ensure that people who have been diagnosed by medical or social care professionals as having a condition that is unlikely to change significantly or that will deteriorate over time are released from the threat of constant assessment which in so many cases adds to their anxiety and so makes their condition more difficult for them and their carers to manage. Many, but not all, DLA claimants with autism typically undergo a number of assessments by expert professionals. Reports from these assessments will be available, as well as detailed information about them from professionals working with them. The National Autistic Society, to which I am grateful for its briefing, has argued strongly that in many cases an additional assessment by DWP is therefore unnecessary.

[Lord Wigley]

My Lords, I have put my name to these amendments. I support what the noble Baroness, Lady Grey-Thompson, said. As joint patron of Autism Cymru, I identify entirely with the points that have been made by noble Lords. I hope there will be further opportunities to press these matters.

[Lord De Mauley]

My Lords, I apologise for intervening in the middle of the debate but I am conscious that it is the custom that we do not go beyond 7.45 pm in Grand Committee. I suggest that this is a convenient moment for the Committee to adjourn until 2 pm on Wednesday.

Welfare Reform Bill

Lord Wigley Excerpts

Tuesday 8th November 2011 Grand Committee

[Lord McKenzie of Luton]

My Lords, in speaking to Amendment 71M, I shall speak also to Amendment 71P. I shall speak to the other amendments in this group when they have been introduced.

Clause 51 is one of the most controversial and unfair provisions in the Bill. It seeks to limit contributory ESA to 365 days in aggregate in respect of the same reference period. The clause further seeks to have the clock running for this currently so that days of receipt to date count towards the total. Our amendment is modest in that it seeks to remove the reference to 365 days and replaces it with an order-making power for which the prescribed number of days must be at least 730—that is, two years. This formulation provides the route to ensuring that any time-limiting of contributory ESA must be based on a proper analysis and evidence, rather than the arbitrary approach that the Bill adopts.

To justify a time limit for ESA we need to be satisfied that it is reasonable to expect people to return to work within the period, or to be fit for work and transfer to the JSA regime or be subject to work-related requirements in the universal credit regime. This judgment is not without difficulty, given the multiplicity of circumstances that cause individuals to be allocated to the work-related activity group—the WRAG. They include mental health and fluctuating conditions and depend on the level of support that is available to individuals. No one is arguing for a system that enables individuals to stay in the WRAG for ever without making any effort to move closer to the labour market. However, is it not the case that, when placed in the WRAG, there is a prognosis of how long somebody will stay there, and that prognosis is reviewed for its appropriateness before a claimant is moved to the JSA regime or, in the future, to the all work-related requirements of universal credit or, indeed, to the support group?

Therefore, in essence, the system has an individualised assessment of how long somebody may need to remain in receipt of contributory ESA if the national insurance conditions are satisfied. If the Government have confidence in the WCA process, why not rely and build on this approach? Is not the answer that this is really not about fairness or making reasonable judgments about how long people need to remain in the WRAG but all about cost savings and removing entitlements to which individuals may have contributed throughout their working lives?

A lot of figures have been swirling around this matter but we know that government estimates show that by 2015-16 700,000 people will be affected by time-limiting. Forty per cent of these will not qualify for means-tested benefit. Of those who do, can the Minister give us an estimate of those who will receive maximum income-related ESA and possibly the distribution of those who will not? We know that 94 per cent of contributing ESA claimants in the WRAG have a claim, the duration of which is 12 months or more. From the Pathways programme, we know that between 2005-06 and 2008-09 only between 25 and 30 per cent of participants found work within 12 months. There are strong representations, for example, from Macmillan to the effect that for many cancer patients 12 months is not a long enough period before they return to work. It maintains that three-quarters of people with cancer placed in the WRAG still claim the benefit 12 months later.

Of course, the Government’s defence of all this is that income-related ESA will still be available. However, the thresholds for the means-tested benefit is low, and entitlement could be denied if a person’s partner earned as little as £7,500 a year or worked more than 24 hours a week. That is another couple penalty and a significant disincentive to work. The Government’s own assessment is that the average change in income for those who lose out from time-limiting is a loss of £52 a week—a staggering amount—with some losing as much as £94 a week.

We can accept that, as with JSA, an argument can be made for contributory ESA to be subject to a time limit, but the line must be drawn at a point where it is reasonable to expect that people will be able to move on from the support and protection of the work-related activity regime. Three hundred and sixty-five days is clearly far too short a time for this yardstick. Seven hundred and thirty days is, it is accepted, an arbitrary figure to an extent, but the real task is to do the analysis, produce the evidence and do the work so that a proper time limit can be established. This evidence-based approach is what the DWP is usually so good at, and it is to be regretted that it is being abandoned in this situation.

Although not spoken to yet, we wholeheartedly support the proposition that the assessment phase should not feature in the number of days counted for any limitation period. The basic JSA rate is all that is received during this period and claimants do not know whether they will end up in either the WRAG or the support group.

Similarly, we support the amendments that prevent any days arising prior to the introduction of the legislation counting towards any limitation period. Can the Minister tell us how many people will lose contributory ESA at the point that these provisions in the Bill come into effect? Writing to tell people that this restriction is probably on its way—and we will have to see the resolve of the Liberal Democrats on this issue when we have the opportunity to vote—is all very well but helpful advice to the effect that the DWP cannot offer any guidance before the legislation becomes law must have been received with some consternation. Perhaps we can ask what feedback has been received.

I have not spoken to Amendment 71P, which is by way of a probe. The notes provided by the DWP state that people in the support group will not be affected by the proposals. Is this correct? Take the case of someone who starts in the WRAG but because of a deteriorating condition transfers to the support group. Prior to any time limit in legislation taking effect, contributory ESA would have been payable throughout, based on satisfying the first and second contribution conditions at the start of the claim. But if entitlement ceases as a result of the time-limiting rule, will the claimant not have to satisfy the contribution conditions afresh? Satisfying the second contribution condition may not be a problem because of crediting, but the claimant could be out of time to take advantage of the last tax year in which the national insurance contributions were paid, the last time when the individual was actually earning in excess of the LEL.

I have a couple of further questions. When somebody is migrated on to the ESA from contributory incapacity benefit, will the national insurance contribution conditions be treated as satisfied or will they have to be met again? The Minister will recognise that somebody who in later years has been treated as having limited capability for work may well have been credited with sufficient national insurance contributions to satisfy the second condition, but may struggle to satisfy the first condition of paying contributions amounting to 25 times LEL within the previous three complete tax years. When somebody is transferred from contributory incapacity benefit to contributory ESA, is it intended that the 365-day clock starts at that point? What analysis has been undertaken in respect of this in planning transfers to ESA? What is the position of somebody who is no longer in the WRAG because they are considered to be fit for work and currently, therefore, are on JSA? Will they be eligible for contributory JSA, albeit for a maximum of six months? Further, policy briefing note 4 makes it clear that further changes are planned to the employment and support allowance to align the earnings rules and taper with universal credit. With contributory ESA in steady state, accepting for this purpose the 365-day time limit, what analysis has been undertaken of the costs and benefits of this? Is it intended to be cost-neutral?

We have a number of other amendments to consider. I have no doubt that we will hear the refrain from the Minister, “There is no money. These changes are vital for deficit reduction”. But there is always choice. The question is: why make these particular cuts and why is this particular burden to be borne by those who by definition are not currently able to work and, moreover, have paid their dues in the past? I beg to move.

[Lord Wigley]

My Lords, I must say that I have considerable reservations about this clause in general, and these amendments touch on a number of them. I have concern about the provision for time-limiting the contribution-related ESA to 12 months, as is provided by this clause. It means that ESA claimants with a spouse or partner working 24 hours a week or more will not be eligible for the benefit. I believe that the time-limiting ESA is a serious disincentive to work for the partners and carers of ESA claimants, which leads to a situation in which unemployment is more financially sustainable than work, which must be a considerable worry to us all.

I further believe that the time-limiting of ESA punishes working families where one member is claiming ESA. Does the Minister accept that those with a working partner or with other income or capital, possibly up to as many as 400,000 people, will lose entitlement to the benefit completely if these provisions go forward? I urge the Government to think again on this.

Welfare Reform Bill

Lord Wigley Excerpts

Thursday 3rd November 2011 Grand Committee

[Baroness Howe of Idlicote]

I present the sincere apologies of my noble friend Lady Mar. She had very much hoped that this amendment would come up on Tuesday, but alas, she has an engagement that she could not possibly break. So I will inadequately move it on her behalf.

Under the Bill, a person will be deemed to have limited capacity for work if the claimant’s capacity for work is limited by their physical or mental condition and if the limitation is such that it is not reasonable to require the claimant to work. The work capability assessment is designed to assess whether a claimant has limited capacity for work or limited capability for work-related activity, but there is no definition of work either on the face of the Bill or in regulations. A group of charities that includes the MS Society, Parkinson’s UK, Arthritis Care and Forward-ME have indicated that this is a significant omission, and it is one that I certainly agree with my noble friend Lady Mar should be rectified.

Individuals must not only be capable of some very limited work; they must be capable of obtaining realistic and sustainable employment. I am sure that the Minister will acknowledge that capability for work is not a clear-cut issue. Many disabled people fit neither the “completely fit for work” nor the “completely incapable of work” categories. As the Minister knows, the main interest is in those with a fluctuating condition—an area where my noble friend Lady Mar has both experience and, indeed, considerable knowledge. They can unpredictably veer between both categories and, however much they may want to work, this group finds it particularly difficult to obtain and retain sustainable employment.

My noble friend and I strongly support the principle that all those who are able to work should be supported through the work-related activity group in ESA, which is designed particularly to identify those who have a limited capacity for work. However, those who face significant barriers to returning to the workplace require extra time and support to move back into the work environment. The WRAG is a very important provision for those with fluctuating conditions, as it asks them to undertake work-related activities that are personalised and appropriate to their needs and abilities. However, the group believes that the current work capability assessment sets too high a bar for the test of limited capability for work—the test that admits people to the WRAG. The test fails to take into account the reality of the claimant’s abilities not just to take on work but to retain and manage unsupported sustainable employment.

The Australian Social Security Act 1991 and the Australian assessment of work-related impairment for disability support pension criteria supply a sensible definition of what could be meant by the ability to carry out meaningful work. Slightly amended for the UK, as is proposed in my amendment, this could provide an important aid in determining whether a claimant actually has limited capability for work. Broadly, the amendment would specify that, in order to be capable of work, the claimant should be able to: work for at least 15 or 16 hours each week in meaningful work that pays at least the national minimum wage; reliably perform their work on a sustainable basis without requiring excessive leave or absences—the Australian system takes this to be at least 26 weeks; and, lastly, work in unsupported employment without requiring excessive support to perform their work. I beg to move.

[Lord Wigley]

My Lords, I am very pleased to support this amendment. One is very aware of the tremendous work that the noble Countess, Lady Mar, has undertaken in this area and of her expertise. There is no doubt that the fluctuating condition of many people with disabilities can be a difficult factor from whichever end you look at it: from the point of view of the disabled person, who may want to work but is uncertain whether they can carry out the work, or from the point of view of the state and the way in which these regulations apply to such people.

The one element in this amendment that I am not entirely certain about is the question of “unsupported employment”. There are times when, if a disabled person is given adequate support, they can be in full-time meaningful work on a continuous basis. I would not want this amendment to undermine that dimension, which is very important.

Turning to new subsection (6B) proposed by the amendment, can the Minister comment on paragraph (b), which refers to work,

“which exists in the United Kingdom”?

This raises some interesting questions. Is it in the Government’s mind that there might be work outside the United Kingdom, the availability of which could, if it were not taken up, lead to people being debarred from their benefits? One thinks of people living in Dover: an hour’s journey puts them into the French catchment area. If one lives in Holyhead, if the fast boats are running one could quickly be in Dublin—presuming that there is any work in Dublin these days. The Government’s intention in this matter certainly needs to be probed. If paragraph (b) is necessary, I would be interested to know what the Government’s explanation is.

[Baroness Wilkins]

My Lords, I strongly support this amendment in the hope that it will go some way to meeting the fears of the thousands of disabled people facing their work capacity assessment, especially those who have a fluctuating condition such as multiple sclerosis or an ill understood condition such as ME. Members of the Committee will have been inundated with letters from people who have been given every reason to mistrust the assessment process as carried out by Atos, and I know that the Minister has been made very aware of the stress and anxiety this is causing.

Broadly, this amendment sets out that, in order to be deemed capable of work, the claimant should be able to work for at least 16 hours each week in meaningful work that pays the national minimum wage or above and, most importantly, that they can reliably perform their work on a sustainable basis of at least 26 weeks without requiring excessive leave or absences. This would do much to rectify the current situation. What happens now is that at the end of an Atos report on a claimant, which goes to DWP decision-makers following the completion of the work capability assessment, there is usually a prognosis which says, “This claimant should be able to return to work within x months”. However, the WCA is not currently designed to offer any concrete evidence of a person’s realistic capability to find employment. The content of the WCA is designed purely to assess a person’s physical and mental functionality, not their ability to find employment, how long this may take or what support an individual may need to do so in the light of the barriers to work that their condition presents.

The WCA test focuses largely on a claimant’s typical day. Yet there is no such thing as a typical day for someone with a fluctuating condition. For example, a woman with MS in her early 30s told the MS Society that on one day she may feel well enough to participate in voluntary work and have a busy and active lifestyle, yet during a recent lapse she was rendered completely blind for a period of weeks and found that on many days she was unable to get out of bed due to disabling fatigue.

The typical-day history taken in the WCA refers to a typical day out of work. However, a typical day out of work for someone with a long-term condition could be very different from a typical day if they had to travel and complete a full day’s work. One person with multiple sclerosis told the society, “Nothing done in the interview related to my ability or my lack of ability to work. I answered the questions as honestly as I was able, but was not able to stress the fluctuating nature of the symptoms, i.e. yes, I can read, but not for more than a few minutes and then I have to rest”. Another person said, “They have no idea what day with MS is like. They do not know how work would go if one day you can walk but the next you cannot, if one day you pee yourself continually and the next you are okay. Who would employ me? I am constantly fatigued, yet of course the WCA found me fit for work.”

I do not doubt the Minister’s sincerity when he says that his whole motivation is to support and enable people to take their place in the world of work, but how can he hope for this to succeed when the assessment for determining eligibility for universal credit is based on such a flawed, unjust and mistrusted system? As we have heard too many times, 40 per cent of those wrongly found fit for work win on appeal of the decision, and in some areas I am told that the figure increases to 90 per cent if people are represented at tribunal.

--- Later in debate ---

[Lord McKenzie of Luton]

My Lords, this is an interesting and challenging amendment and the debate has been deeply concerning. We have heard from the noble Baroness, Lady Grey-Thompson, that people are terrified and scared about facilities not being available; we have heard from my noble friend Lady Wilkins about the mistrust of the WCA and the profound mistrust of Atos and some challenging questions about how they are regulated; and we have heard from my noble friend Lord McAvoy and the noble Baroness, Lady Howe, about fluctuating conditions.

I understand that the system works at present by seeking to establish if someone has limited capability for work, and that this is determined by a range of descriptors which seek to establish how someone’s physical and mental health affects their functioning. Someone not reaching a sufficient points total would not be classified as having limited capability for work and would therefore—in essence by default—be deemed fit for work. The point was pressed that the assessment does not look at whether someone having not been deemed to have limited capability for work is therefore fit for work in any practical or coherent way. Actually, that gives food for thought. Somebody who has been deemed fit for work would seem to claim JSA and be subject to relevant conditionality and in the world of universal credit be subject to all work-related requirements. There have been ongoing debates about how appropriate the descriptors are and, perhaps more fundamentally, how they are applied in practice. We have certainly heard some of that today. This is of particular interest to us, because we were in government when the system was introduced; I remember all the policy staff and all the work that was done to introduce the ESA and the WCA. Given the fact that it is not working as it should, maybe the judgment was that it is not capable of working in any event, and that is of some concern.

The Harrington review has published its first considerations and the recommendations have been accepted. It is understood that the second review was completed in July and is still under consideration. Perhaps the Minister can give us an update.

A key question that the amendment poses is whether the WCA, properly applied, would mean that the outcome sought by Amendment 55C would inevitably follow, assuming that it was the outcome that was wanted. I think probably not. On making a judgment about somebody having limited capability for work, there is a prognosis also about how long they would remain so assessed—that is to say, a determination about when they would be fit for work. The noble Baroness, Lady Wilkins, again made this point. When making that determination, to what extent would those judgments reflect the criteria that this amendment seeks to set out? Again, I suspect not—but perhaps the Minister can help us by telling us the criteria applied when someone is making a judgment after a while whether somebody is fit to go back to work and fit for the JSA regime or the full work conditionality. Is it just the absence of failure of work-related activities requirements, or is it something more positive in trying to see what they are actually capable of and what the definition is of work? I am not being very clear on this issue, but my concern when I think about it—and I had not thought about it in this way before—is that the WCA assessment puts somebody in a category. If they fail, although fail is perhaps not the right term, they go by default into a category that assumes they are fit for work. Should that judgment inevitably follow from that process?

There is a sense of cliff edge about the system. On one side of it, there are full conditionalities and harsher sanctions, and the full work-related requirements; on the other side, there is lesser conditionality and requirements only in respect of work-related activity, no prospect of higher level sanctions and higher benefit levels. Of course, all of this rests on the judgment under the WCA, subject to reconsideration and appeals and so on. So much hinges not only on the descriptors and how they are set out and whether they are appropriate but on how they are applied. Universal credit does not particularly smooth that particular cliff edge, although it deals with other cliff edges about going in and out of work. But with regard to the analysis and judgment of where people sit in the categories, it does not particularly help. A lot of this is to do with the support that people should have.

[Lord Wigley]

I invite the noble Lord to comment on the relevance of assistance in work. If people are available to help someone who is disabled to undertake their work, it is possible for them to fulfil some of these requirements. If that person is not available, it is the failure of the state to make that person available that is creating the handicap for the person who is disabled. In applying the social definition, there could not be a clearer example than that.

[Lord McKenzie of Luton]

I very much agree with the noble Lord, Lord Wigley. He is absolutely right about that. I imagine that the Minister will reply that this is too narrow a definition of work but I do not want to anticipate what he wants to say. The more I think about it—this is not a formal Front-Bench view—the more I believe that we ought to be thinking about smoothing the path so that we do not have that cliff-edge, as we are doing away with cliff-edges for in-work and out-of-work benefits. Is there not something that we could do to create more of a continuum, so that these very difficult judgments would not have to be made?

--- Later in debate ---

Given those assurances, I urge the noble Baroness to withdraw the amendment.

[Lord Wigley]

May I press the Minister a little further on the position of people who might be capable of work if they have assistance? To the extent that the assistance is not available, would that be a definitive reason why they should not lose their benefits?

[Lord Freud]

It is clear that a lot of changes are going on and I am not surprised that people do not understand them all. One of the things that we have done means that claimants in the support group can volunteer to go straight on to the work programme, where there is substantial help for them to get back into work. That is one way in which we are helping people who may find themselves in the worst possible position to get into work. We have made a very straightforward mechanism.

I pick up the point of the noble Lord, Lord McKenzie. We are instigating a process whereby people, if they are in the WRAG with a prognosis, are asked by work providers whether they would like to come in at any point—I think at six months. They are then encouraged to volunteer for the process early. They do not move from the WRAG to JSA until there is another WCA. We are talking about a process here; it is a dial for these people, as the noble Lord said, but it has to be understood in the context of how the work programme operates as well as how the WCA operates.

--- Later in debate ---

Moved by

[Lord Wigley]

55D: After Clause 39, insert the following new Clause—
“Effect on devolved administrations
Where the implementation of any sections in Part 1 of this Act may have an implication for other services which are the responsibilities of devolved administrations in Wales and Scotland, there shall not be a commencement of such sections until the impact of such provisions has been discussed with the relevant ministers of the devolved administrations.”

[Lord Wigley]

My Lords, the Minister will not be entirely surprised that I raise the question of the possible knock-on effects of the Bill on the services provided by the devolved Administrations. It could no doubt be argued that there is an equivalent or parallel question arising with regard to the consequences for local government in England, which I shall touch on a little later.

I tabled the amendment at this stage, towards the end of Part 1, because several of its provisions relating to disability, housing benefit and children have an impact on matters that are partly or wholly devolved. I could well have raised this question in different parts of the Bill but I shall content myself with just raising the issues at this stage if that is acceptable.

I remind the Committee that for both Wales and Scotland housing, social services, education, children’s policy and local government are totally devolved. It is the responsibility of the Government of Wales to provide the finance needed for those responsibilities within Wales. On numerous occasions during the past four weeks we have heard the Minister repeatedly resort to the discretionary payments and provisions that may be made by local authorities in some circumstances to make up for any cash or support losses suffered by vulnerable individuals who may lose out under the changes in this legislation. Someone has to pay for that at the end of the day, whether it is for emergency housing, social workers’ time or effort, or for the care bill needed for children or whoever.

The amendment is a modest one. It calls merely for the impact of legislation on devolved services to be discussed with relevant Ministers in Cardiff and Edinburgh before the provisions of Part 1 are implemented, which presumes that an impact assessment would have been made to enable that discussion to take place. The Minister may say that we are already having a dialogue with the devolved Administrations on these matters—I see him nodding, surprise, surprise—but I can assure him that Ministers in Wales have not so far received responses to their concerns that have put their minds at rest on a number of these points. For example, Welsh Ministers have expressed concern that changes to DLA rules will have a seriously greater effect in Wales than in England. There are 126,000 DLA claimants of working age in Wales, compared to less than 1.5 million in England. Wales has 5 per cent of the relevant population but 8 per cent of the claimants.

Welsh Ministers have expressed in writing, and made representations to Her Majesty’s Government about, their fear that these legislative changes will make disproportionate additional demands on social services departments in Wales and on the budgets of those service providers, and have disproportionate consequences for devolved budgets.

--- Later in debate ---

[Lord Freud]

My Lords, I am also looking forward to reading the Low review but I have been listening with great intensity to everything said in this Committee today. Social security is a reserved matter, although it will clearly have a limited, tangential impact on areas of policy where the Welsh Assembly and Scottish Parliament have competence, the obvious examples being childcare and housing. It does not, however, include DLA, which was one of the issues raised by the noble Lord, Lord Wigley.

I can reassure noble Lords that we have held, and will continue to hold, regular discussions with Ministers in the devolved Administrations and their officials. We are committed to the smooth and successful implementation of universal credit. To achieve that we are working closely with devolved Administrations and relevant local authorities to help them identify and address the impact that the introduction of universal credit will have on any services that they deliver. We are doing so in line with devolution guidance. My department is continuing to work through the detailed design aspects of universal credit which will be covered in regulations. Throughout this process they will continue to have discussions with the devolved Administrations, as appropriate, on these provisions and on others in the Bill. I can assure the noble Lord, Lord Wigley, that whatever I am saying here is relevant to the whole of the Bill.

I am concerned that this amendment would introduce a new and unnecessary level of bureaucracy. My noble friend Lord German hinted at some of the problems that it would result in. In practice, that would hamper progress and potentially delay the introduction of universal credit, let alone other aspects of the Bill.

[Lord Wigley]

Can the Minister clarify how that bureaucracy comes about?

[Lord Freud]

The issue is that if there is an additional, formal process, requiring a formal level of discussion at a formal time before you can clear particular things, that is another element of delay to negotiate when we already have a huge number. We are on a very precise plan of implementation here. Those noble Lords who were able to see the presentation of how we are introducing and implementing universal credit will be aware of the importance of a smooth process. I am concerned to avoid delays due to artificial elements of bureaucracy. Our ongoing discussions with devolved Administrations are the best way to address any impact on devolved services and achieve the successful implementation of these reforms. With that reassurance, I beg the noble Lord to withdraw his amendment.

[Lord Wigley]

I am grateful to the Minister for his response. I am intrigued by the way in which this bureaucracy is going to be such an imposition. If there are meaningful, ongoing discussions with the Administrations in Cardiff and Edinburgh involving a two-way flow of discussion, after which there is either a meeting of minds or not, that is not an extra level of bureaucracy. If that is not happening and it would be an extra imposition, I would be very concerned because the reassurances we are getting would be insufficient.

[Lord Freud]

My Lords, let me make myself utterly clear. If we had a statutory duty to discuss and if a devolved Minister were, for any particular reason, unavailable—my noble friend Lord German made my point here—our progress could be slowed. That unavailability could, potentially, be deliberate. We do not want another problem to negotiate when we already have a formal set of agreements on how we relate to devolved Administrations. We are sticking to those and we are talking regularly and informally on how best to get this through.

[Lord Wigley]

I note what the Minister says. He suggests that there could be some deliberate refusal to engage in such discussions. Does he seriously have examples of that happening that he could cite to the Committee, or is it something that he is imagining?

[Lord Freud]

My Lords, I could not reveal any confidences about the discussions that I have had with Ministers in devolved Administrations. Therefore, regrettably, I cannot answer that question.

[Lord Wigley]

I understand where the Minister is coming from. However, the point is that there may well be a difference of opinion between what is perceived as good public policy in Cardiff and Edinburgh and what is perceived as good public policy in his department under his Government. After all, they are different Governments of different political complexion, which will have different priorities. That is true of the current Government in Cardiff and the coalition Government who were there before them. The whole point is that we need some understanding on this.

[Lord McAvoy]

Is the noble Lord, Lord Wigley, perhaps interested in asking the Minister whether these confidential discussions are subject to freedom of information requests?

[Lord Wigley]

That would indeed be interesting. No doubt we will hear if that is the case. However, on this amendment I was also pressing for assurances—it may well be that the Minister was giving them in the words that he used—with regard to the application of the concordat. I assume from his words that the concordat—I quoted from paragraph 17—is fully applicable and will be in the context of these negotiations; and, likewise, that the assurances of “no surprises” that have been given to local government will also be applied. If there are any direct relationships between his department and local government in Wales, which there could be in the context of housing benefit because there is a direct relationship, will those assurances apply equally? I am sure that the Minister is about to nod that that is his understanding, but I should be grateful if that could be put in writing.

[Lord Freud]

I repeat my point: we are absolutely moving in line with devolution guidance. We have no intention of doing anything other than that.

[Lord Wigley]

I have probably got as far as I will get by rattling around this set of bones but this is clearly a matter of some concern. We will not know for certain until the Bill becomes an Act and how this works is turned into reality. However, I very much hope that if, in that reality, it transpires that significant additional costs are landing on local government in England or the devolved Administrations in Wales and Scotland, the Government will pick up the bill in the spirit of the concordat and the other devices that they have if it is their actions that are causing those additional costs. On that basis, I beg leave to withdraw the amendment.

Amendment 55D withdrawn.

Welfare Reform Bill

Lord Wigley Excerpts

Tuesday 1st November 2011 Grand Committee

[Baroness Hayter of Kentish Town]

My Lords, I will raise a couple of points—and not simply to defend my aunt. I said that she worked at the Conservative club. She was the barmaid and cleaner. The noble Lord is very lucky that she is no longer with us.

[Lord Wigley]

I have been mulling over this point. Is the noble Baroness sure that she is not inadvertently misleading the Committee? Surely there is no such thing as a Conservative club in Ystradgynlais.

[Baroness Hayter of Kentish Town]

Perhaps I may ask a couple more questions. I think that the Minister said that the figure I used of 50,000 was wrong because the only people who would lose out are those working between two and five hours at the national minimum wage. However, it is exactly those sorts of people who are carers and who will be doing quite small numbers of hours: the six-to-eight shift, if you like. Even though it is a small number of people, it would be interesting to know whether there was an impact assessment of the effect on carers and whether it showed how they would be affected.

I have two other points. One is about the figure of £4 billion, which gets used a lot. The disregards will not necessarily cost the Government money; if they are encouraging people into work, those people will quite quickly start paying tax and NI—not immediately but fairly quickly—and they will quickly pay for themselves. I realise that that will not happen at the moment as there is rather a lot of unemployment because of the Government’s policies, but we will not go there. Normally, though, the incentive is to get people into work, so that will soon begin to pay itself off.

--- Later in debate ---

[Baroness Donaghy]

My Lords, the purpose of this amendment is to recognise the particular needs of the self-employed. It would ensure that the power to prescribe a minimum level of income applies only to those self-employed claimants who under-declare their earned income with a view to maximising their entitlement to universal credit.

While it is important to prevent abuse of the system, it is equally important not to discourage the genuine self-employed claimant with a potentially viable business in the early stages of development or one that is in financial difficulty. The White Paper acknowledges that,

“in starting up a business … it can take some time before it becomes profitable”.

It proposes that the minimum income floor should be applied only when a business has become “established”.

There is at present no indication of how that is to be interpreted or what guidelines or regulations will be issued, so I ask the Minister: when will this information become available?

As I said at Second Reading, there are some 4 million self-employed people in the UK, and that number is likely to grow as employment becomes more difficult. It represents an enormously varied group which faces a greater degree of risk than is faced by those in traditional employment. Profits are affected by any number of events such as the loss of a key customer, the sickness of the sole proprietor, a bad debt or accumulation of slow payers, or even by taking on a new employee. The measurement of self-employment income for universal credit purposes should follow generally accepted accountancy principles and aim at a true and fair view of a business’s profit. The welfare system needs to support businesses through such periods, not discourage them by imposing unrealistic levels of deemed income such as the minimum income floor.

My amendment recognises that real abuse should be directly targeted, but that if you impose a minimum income floor for each hour worked, that in itself will open the floodgates for abuse. This view is supported by the National Farmers’ Union, the Tenant Farmers Association and the Federation of Small Businesses, as well as by Community Link, Citizens Advice and the Child Poverty Action Group. There are those with disability or a medical condition that makes it difficult for them to take traditional employment. We have already heard from the noble Baronesses, Lady Grey-Thompson, Lady Thomas of Winchester and Lady Wilkins, about how difficult it is for the disabled to find employment. Being self-employed often allows the disabled to work at their own pace and according to a pattern that suits their circumstances.

I have another question. What steps are the Government taking to minimise the compliance burden on the self-employed? The current system requires only one set of accounts to be prepared, which is accepted for both tax and tax credits. This allows the individual to get on with running their business. If a different measure of self-employed income were to apply for universal credit, the burden would increase because individuals would have to assess profits for tax purposes according to one measure and income for universal credit purposes according to another, quite different, measure.

If income is to be based upon reported hours, the harder a self-employed person works to get their business on its feet, the more they could lose from their universal credit entitlement. Some might spend as much time seeking paid work as actually doing it, such as taxi drivers who may work 50 to 60 hours per week or more. It would be unfortunate if this measure were to deter genuine claimants from taking the risks inherent in self-employment when its purpose is to prevent a minority under-declaring their profits.

Perhaps I may give a real example sent by the Royal Agricultural Benevolent Institution. I hope that it is not one of those examples that the Minister will say is a unique and very special man. He is a single man aged 53 on a rented 160-acre farm, farming arable/field vegetables only. He has had a disastrous winter and lost the whole crop due to bad weather and flooding. Consequently, he has made a loss this year and is very distressed. As this would be calculated by HMRC to be nil earnings, he is currently eligible for a full working tax credit of £51.87 per week. Under the proposed changes in the universal credit, he will no longer be entitled to any help. The circumstances were beyond his control, and without the safety net of the tax credits he will be unable to get back on his feet and carry on farming. What will he do? Is this an example of someone where savings are to be made? Is he to face the humiliation of getting advice from Jobcentre Plus about diversifying or going to work for the farm next door?

There are already regulatory powers to counteract moves by claimants to under-declare their income for tax credit and benefit purposes. Under the income deprivation rules, a person is deemed still to have income of which they have divested themselves in order to maximise their claim to benefit or tax credit. Where the Government perceive this abuse, surely the right course is to enforce existing powers rather than invent new ones that will discourage genuine cases.

This brings me a group of individuals who in practically every sense of the word are employees but who are treated as self-employed because the alternative is no job at all. When I was a member of the Low Pay Commission, a situation where economic circumstances took away choice was called monopsony—which is not a word that is used very often. I have met home workers who were forced to accept self-employed status in order to earn money. If they asked questions, they would be replaced with one of the hundreds of women in the area who were confined to their homes for domestic or cultural reasons and were equally desperate for work.

In the construction industry up to 90 per cent of workers in London are self-employed, and yet they are told when to turn up for work and what to do when they are at work. HMRC is responsible for the construction industry tax scheme, the CIS, where contractors submit monthly returns detailing their subcontractors and certifying that none of them is in fact an employee. However, the questions asked of a contractor to establish whether any of their subcontractors are self-employed are remarkably similar to the criteria used for identifying direct employment. Successive Governments have tried to deal with the issue of bogus self-employment with little measurable success. In my report on the construction industry I wrote that:

“It may be that successive Governments see the various schemes they have adopted as a buttress against the huge informal economy in construction—a compromise so that at least some tax is collected”.

I raise these two examples of bogus self-employment—some home workers and some construction workers—to emphasise that the Government’s proposals could penalise the genuine self-employed and fail to tackle some of the gross abuses that happen now. These abuses could be alleviated by the proper enforcement of our tax laws by HMRC and of our employment laws by the Department for Business, Innovation and Skills in conjunction with the Department for Work and Pensions—with all the resources that that implies. It would also mean a level of interdepartmental co-operation in Whitehall that would make even the Minister with his acknowledged abilities blench in terror.

In conclusion, there is a clear distinction between profits on the one hand and drawings on the other, and welfare policy must reflect that distinction if in-work support is to succeed in promoting work through self-employment. The success of working tax credits in encouraging work, in particular self-employment, rests on a recognition, in alignment with the tax system, of the economic reality of how a business is doing, particularly with regard to investment in business equipment and trading losses. How is the Minister going to treat the self-employed, and does he think that my amendment would help to emphasise the real target rather than those struggling to survive in deeply difficult financial circumstances? I beg to move.

[Lord Wigley]

My Lords, I give enthusiastic support not only to the amendment but also to the direction in which the noble Baroness is taking the Committee. The need to ensure that disabled people do not feel that they are being debarred by the system from becoming self-employed is very important indeed. Possibly it has been a greater problem in the past and I hope that it will become even less of one with the changes we are getting. However, we need certain assurances if that is to be the case. I believe not only that this is in their own interests, given that self-employment can offer a flexibility which can be very useful, but also that they have a massive contribution to make. Given support, disabled people can also become the employers of other people. Therefore I hope that it will be possible to give the assurances that have been sought in the amendment in order to move things forward on this agenda.

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[Lord Freud]

My Lords, universal credit is particularly well suited to that situation because it is a household income. We will have rules on the two benefit recipients in a two-person household, so we should be able to adapt to that reasonably straightforwardly. Clearly there will be circumstances when one person is in paid employment and the other is self-employed, and we need to mix that. We are working on defining all those situations so that we can make universal credit work appropriately.

[Lord Wigley]

To follow that point through a little, I understood that the intention was not to take the circumstances when one was in paid employment, but when both might be employed or self-employed in their business and both getting their income. Presumably there would need to be some attention to those rules as well.

[Lord Freud]

My Lords, I am sorry. I probably broadened the point that should have remained narrow. When two people are working on one endeavour, because universal credit is a household payment, it can accommodate that without any distortion.

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[Lord Freud]

It is clear that we cannot use real-time information for the self-employed. It is another system. It will be much closer to the kind of reporting systems for tax credits in this area—and for that reason.

[Lord Wigley]

A disabled person might have feared going self-employed in the past because of the possibility of losing benefits and not being able to get them back at some future date. That would have been a psychological barrier. Could the Minister confirm—I am sure that he can and will be eager to—that that problem should be overcome by this system? It should be sympathetic to, and encouraging of, people becoming self-employed.

[Lord Freud]

Yes, the system is absolutely straightforward for a disabled person who goes into employment, where it is unequivocally much safer. There is a difference in self-employment in that, in cases of low earnings, we will look for an element of potential conditionality and a relationship with that person when they do not want to observe the minimum income floor. You have a choice: either have a minimum income floor and then there is not conditionality; or you come below it and there is a conditionality regime. That does not mean there is an instruction saying, “It is out to work. Stop what you are doing”. It absolutely does not mean that. It means that we know what people are doing and, after discussing it with them, can reach an assessment of what they should be doing. In many cases we will be absolutely happy for them to continue that regime. It offers us an opportunity to know what is really happening out there—I suspect in a way that we do not know now.

Welfare Reform Bill

Lord Wigley Excerpts

Wednesday 26th October 2011 Grand Committee

[Lord McAvoy]

I thank the noble Lord, Lord Kirkwood, for drawing attention to that sort of matter because, with the exception of the first two Committee meetings, at every sitting half the time has been taken up by the Labour Opposition and the rest by others. There is no question of anything deliberate on this side; that was a clear inference. This side has taken up half the time and half the time has come from others. I do not complain because on at least seven occasions the Minister, who is extremely able and competent—I can also butter up—has had to say “I will write to you” because of the complicated nature of the questions from my noble friends on this side of the House. It is a point that the noble Lord, Lord Kirkwood, should make but I do not think he should make it to this side.

[Lord Wigley]

My Lords, I think that I have attended every sitting of this Committee. I find it immensely frustrating that, when one sitting ends, one finds that by the beginning of the next a wodge of new amendments has come on board. It does not mean that the points raised are not important or that there has been time-wasting. However, it is immensely difficult for people, particularly those with responsibilities to organisations outside the Chamber, to organise themselves to put the points that they need to put in debates. It is not just for this Committee but for the House to consider how to get a more orderly way of doing business.

[Baroness Drake]

My Lords, I support the amendment and come back to its detail; my noble friend indicated that it was a probing amendment. This is an opportunity to raise significant issues about in-work conditionality. Where a welfare system has to balance rights and responsibilities, under universal credit those in work will be embraced by an in-work conditionality of some complexity which neither they nor their employers will previously have experienced. From the emerging details of in-work conditionality it is clear that it will give the Government significant discretion over a sizeable section of the workforce, and powers to follow through with sanctions that will affect people's lives very significantly.

This is a novel discretion for three reasons. It will impact on a much greater volume of people; it will impact on existing in-work relationships; and it will require Jobcentre Plus people or any outside providers to engage with large numbers of companies with which they have previously had no engagement.

Setting and enforcing what is a reasonable condition, particularly in terms of increasing hours or requiring people to seek and change their jobs, must be sensitive to a range of factors: for example, local and regional labour markets, and different sectors and their employment practices. If an employer puts their employees on short-term working rather than making them redundant, is that a good thing or will it attract conditionality requirements? How will it be handled? What will happen when people have atypical or variable hours work contracts? Over what period and in what manner will earnings be averaged to assess compliance with income thresholds on conditionality?

In requiring people to work more hours or seek a higher-paid job, it is important to ensure that childcare and conditionality interact fairly. Parental need for confidence in the care of their children needs to be respected. My noble friend Lady Hollis moved in on some detailed concerns in this area. Any casual observation of female labour market statistics will show two peaks of part-time working by women. They coincide with key caring periods. Part-time working in the UK is part of the systemic solution to childcare, particularly for single parents. One cannot look at conditionality on the one hand without looking at the nature and characteristics of childcare in the nation as a whole. How will the sanctions regime be applied? How will it impact on the children of those who are subject to sanctions? How long will people and families be given to adjust to any new requirements and conditions, particularly if they come on top of a period of compulsory redundancy?

What we see from the details coming forward is the micromanagement of the work patterns of potentially millions of people, and the application of wide discretion that will need a considerable set of guidance notes and competences to apply the conditionality. The staff making these in-work conditionality assessments will have no previous experience of doing this. It is a novel area in its scale and complexity. No doubt in answer to my questions the Minister will say what is intended or that the matter is work in progress. It is pretty clear that an awful lot of work is still in progress. I say that not to appear negative but to say that the Bill has the effect of giving the Government considerable discretionary power over people in work.

Parliament needs to be satisfied on three issues: that the capacity and capability to implement the proposed in-work conditionality is there; that there is confidence that the discretion will be applied consistently, fairly and proportionately; and that there is a high level of confidence that there will be no inequalities of treatment or impact in the outcomes of applying that discretion. Because conditionality is now going to be applied to people who believe that they are already making a contribution, they will have to experience a different perception of the contribution they should make in terms of being in work.

I want to pose two questions for the Minister. First, do the Government intend to pilot in-work conditionality before they introduce it nationally? Secondly, would any introduction consequent on those pilots be both gradual and incremental so that experience, knowledge and skill can be built up by those assessing claimants? Thirdly, what will be the reporting to Parliament about the level of confidence that this complex system of in-work conditionality can be applied fairly and proportionately?

--- Later in debate ---

[Lord McKenzie of Luton]

I shall speak also to Amendments 51CEA and 51CDB. I start with the latter. This started out as a simple probing amendment, but the more we looked at it, the more we considered that it had wider implications. Clause 16 deals with work preparation requirements. A claimant can be subjected to work preparation requirements if they have limited capability for work. A limited capability for work is defined in Clause 38 and will be determined in accordance with regulations. For a start, can the Minister confirm that the regulations will reflect the work capability assessment as updated by the Harrington reviews? We will of course have an opportunity to discuss this in greater depth when we reach the clause, but for the present, our understanding is that universal credit will adopt existing and emerging criteria which, among other things, differentiate between those with limited capability for work and those with limited capability for work-related activity. The latter would currently fall into the support group for the purposes of ESA and not be subjected to work-related requirements of the universal credit by virtue of Clause 19. Those not falling into either category would currently fall within the scope of JSA and, for universal credit purposes, be subject to work search and work availability requirements. Claimants under the universal credit subject to work preparation requirements cannot be subject to any other work-related requirements—other than a work-focused interview, of course.

The issue we probe is the nature of work placements, of work experience and the extent to which that encompasses activity currently accepted as beyond work-related activity or work preparation and is equivalent to the world of work. In short, is the Bill extending what have hitherto been the boundaries of work-related activity? Clause 54 suggests that it does, as, for ESA purposes, it adds work placements and work experience to the definition of work-related activity in the Welfare Reform Act 2007. Why is that change proposed? The WCA process seeks to differentiate between those currently fit for work and those who are not but who can move closer to the labour market. Can the Minister give us more detail of what is encompassed within work placements and work experience and the essential difference between those and work itself? We are aware that mandatory full-time work experience was to be tested as a result of the provisions of the Welfare Reform Act 2009, but those provisions related to those required to meet the jobseeking conditions. Has any testing been done with those not subject to the JSA regime; and, if so, under which provisions? Is it envisaged that work placements and work experience will be time limited? If so, what time period is envisaged?

How will that operate within the work programme? Are providers currently precluded from imposing work placements and work experience on those not subject to the JSA regime? Does work placement for 16-plus hours a week which goes on to become a more permanent job count towards the outcome for which providers are remunerated? Can the Minister confirm that the same type of protection for, say, lone parents and those with caring responsibilities will be applied for work preparation requirements as for those who are subject to all work-related requirements?

What assurances can the Minister give that activity to meet work placement requirements will not squeeze out opportunities for claimants to attend skills assessments and to undertake training? What sort of quality assurances will be sought by Jobcentre Plus or providers in respect of those offering work placements and work experience, especially to avoid a constant churn of individuals in place of permanent paid jobs? I look forward to the Minister’s reply.

Having said that, I have not spoken to the other two amendments in this group—Amendments 51CDA and 51CEA. These are both probing amendments as well. As we have noted, Clause 16 is concerned with work preparation requirements and in individuals subject to such requirements if they have limited capability for work. The requirement is for them to undertake particular actions. Included in the actions that might be specified is “improving personal presentation”. It is presumed that this would encompass such activities as CV writing and presentation skills but we wonder if the Government have anything else in mind.

Clause 17 refers to “work search” and Clause 17(3)(c) lists as one of the actions which might be specified,

“creating and maintaining an online profile”.

The briefing pack indicates that this is to facilitate job matching and making applications. It says:

“We expect that the new IT systems underpinning Universal Credit will support effective monitoring of work search activity. We expect to establish an online portal where claimants can set up their own ‘profile’. The system will provide claimants with access to job vacancies (including jobs automatically matched to the claimant’s profile) and the ability to … search for work and we anticipate the system will provide advisers with information and updates as to what the claimant has done”.

What training will be available to support claimants who will be less adept at using this technology to ensure that they have equal access to job applications? I beg to move.

[Lord Wigley]

I shall speak briefly in relation to the third of the amendments that has been put forward to Clause 17—that about, on page 8,

“creating and maintaining an online profile”.

I can see the merits of having that available but it might become an imposition. Many people who may be looking for work would be scared stiff of that approach, particularly the older ones or those who have restricted abilities. To be imposing or suggesting that this is a requirement surely should not be written on to the face of a Bill. I would be glad to hear the Minister’s justification for it.

[Lord Freud]

My Lords, not all claimants will be required to carry out all or indeed any of the actions listed in these clauses. They are meant as illustrations of the type of actions that may be imposed. Taking “improving personal presentation” first, we already require this of jobseeker’s allowance claimants where their appearance is proving to be a significant barrier to work. Advisers handle such cases sensitively and directions are used sparingly and as a last resort. It is not about impinging on an individual’s basic right to express themselves with their appearance but, where a claimant is actively putting off potential employers, such as with poor personal hygiene or turning up to interviews with holes in their clothes, we need to be able to address it.

On work experience and work placements, I would like to emphasise how valuable these can be as an opportunity for claimants to experience all aspects of being in a work environment, to develop skills and confidence in preparation for future employment or further work preparation, and to improve their CV and marketability to employers. This is particularly important for jobseekers who have limited or no experience of the workplace. For many it represents the main barrier preventing them from getting a job.

For claimants who have limited capability for work, we believe that appropriate work experience and work placements can help them to understand more about their career options and skills, increase confidence and provide valuable experience that they may need to get started in a job in future. The amount, duration and timing of any work experience or placement will be tailored to the needs of the individual and will not necessarily be more demanding than other actions they might be expected to take to prepare for work.

These activities could take many forms and do not need to be full-time; for example, work shadowing could be suitable for some claimants with limited capability for work. We want to ensure that claimants in the work preparation group can access valuable support and experience that could help them move into work in the future. To do this, advisers need to have the flexibility to specify the actions that they think give a claimant the best prospects of moving towards employment and be clear that in some cases this may include work experience or a work placement.

Finally, as you know, we are developing our own online service that will enable the claimant to create and maintain a personal profile, complete job-search activity including automatic job-matching when new vacancies are registered, and apply for jobs. We intend that this information will be available for the department to monitor the claimant’s activity and assist in checking compliance with their claimant commitment. There will be robust data protection, security and privacy measures in place; for example, claimants applying for jobs would remain anonymous from employers and recruiters until they accept an invitation to interview or contact them directly themselves. Access to jobseeker records by DWP staff will continue to be audited and existing user restrictions and business needs will determine which members of staff can see customer data.

It would be a waste of investment in a quality service for claimants, and severely hamper our ability to monitor compliance, if we were not able to require claimants to use the system. However, taking out this requirement would apply not just to our system, but to other online job-search sites. Increasingly, as many employers only recruit online, it is critical that claimants engage with online services that increase their chances of finding and moving into work. Of course, if a claimant is in the minority who cannot use or be helped to use online services, or if there is another compelling reason, this requirement will not be imposed. I hope that gives the noble Lord, Lord Wigley, some small reassurance.

[Lord Wigley]

Before the Minister sits down, perhaps I may press that a little further. I am interpreting what he says as implying that there might be circumstances where someone refuses to use the online system and could lose benefits as a result. Is that the case?

--- Later in debate ---

[Lord Wigley]

Before the noble Lord withdraws the amendment, which I suspect he was about to do, I return again to the provisions in Clause 17. They really are draconian. We have not only the provision highlighted in paragraph (c) of subsection (3),

“creating and maintaining an online profile”,

but paragraph (f) states,

“any action prescribed for the purpose in subsection (1)”,

which could be anything at all. To give these powers without some strong safeguards on the way on how used fills me with absolute horror. With respect to the online profile, that states that there can be an order for the person seeking work requiring him or her to create their own online profile and to maintain it. If they are either incapable of creating it, or are not diligent in maintaining it, they could lose their benefits. This would not be a problem for my four year-old granddaughter’s generation, as they pick up this technology easily, but I know of teachers approaching retirement age or perhaps losing their jobs who would be incapable of doing this on a computer. To make that a requirement in the Bill strikes me as absolute nonsense. Surely, this measure should be looked at again.

[Lord Freud]

My Lords, let me just—

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[Baroness Hollis of Heigham]

My Lords, I support my noble friend in particular on Amendment 51CEC, which is about the cost of travel. Too often and too easily we assume a London model, with the Tube, regular bus services and so on; although even there, lone parents may find it difficult to access work in the way that they would like. However, in a county like Norfolk, where many villages have a bus service twice a day, you have a very different story. In Norfolk you have some of the lowest wage rates and some of the highest car ownership rates in the country; but those cars are battered, second-hand jalopies, which are taken by him to get to work, leaving her—usually—with the children and finding it very difficult to do anything except use a bicycle. The result is that it is very difficult for the second earner in a family, or—even more pertinently—a lone parent, to cope with travel to work if there is no job available for her in the local village.

We are expecting a lone parent to work 20 to 25 hours per week. She has two children, one of whom has to be delivered to a childminder and the other to the local school, but she has no transport apart from her feet. Finally, after that, she has somehow to get to a job of her own, and she has to do that again at 3 pm or 3.30 pm. It is almost impossible to find a job between those two hours in the locality, let alone further afield, given that she has to allow for her travel time. I remember one lone parent telling me that she calculated that the school bus picked up the children of the next-door village 40 minutes earlier than it picked up the children of her village; so she used to walk her child about two miles to the next-door village in order to put the child on the school bus, which would act as a form of childminder. That lone parent, with a great deal of ingenuity, managed to get to her job for its 9 am start. She was able to do so because the two villages were within walking distance of each other, but there is a real problem here. I think those of us who live in London or cities have no sense of just how isolated those villages can be.

However, the work requirement will apply to women, both lone parents and second earners, in a situation where there is no public transport, no private transport, a bicycle that you cannot actually take a small child on—let alone two children—except with some degree of difficulty and therefore there is only feet. I suggest to the Minister that it requires enormous juggling skill even to hold down a part-time job. Sometimes the jobcentre that the person has to travel to is not even in the whole of a rural district but may be 20, 30 or 40 miles away. I hope that jobcentre advisers will take all that into account when deciding what is reasonable for that lone parent or woman—and it is usually the woman who is the main child carer—in that situation. I ask the noble Lord to be sensitive to those issues, not because there is any lack of commitment but because of the sheer, simple, practical, logistical difficulties such women may face.

[Lord Wigley]

Perhaps I may add briefly that I identify totally with the rural dimension that the noble Baroness has just described. A bus twice a day would be a luxury in many villages in rural Powys and other parts of rural Wales. If a person has been lucky enough to have a job and a lift to work from a colleague, but the job comes to an end and they have no independent transport of their own and are required to go some distance to fulfil their obligations under the Act, that would be totally unreasonable. I would be glad to know what guidance the Minister will give to people who are trying to implement the Act on how to deal with circumstances such as those.

[Baroness Sherlock]

Perhaps I may ask one question. The noble Lord will be aware of this issue. We have heard about it from many claimants and I am sure that other noble Lords have had similar experiences to mine. At least one organisation that works with lone parents has complained to me about cases where lone parents have been sanctioned for failing to take jobs. They were confident of the veracity of the accounts they had been given, and it was clear that the claimant could not possibly have made it to the job and taken their children to childcare. There did not seem to be any malice involved, but the adviser did not understand what was involved in trying to get two or more children to different kinds of childcare in very tight timescales, in a context where being a few minutes late can mean either that you are fined by a nursery or that your child’s place is given to somebody else. How will the Minister protect claimants in that situation? Will he make sure that the guidance is sufficiently clear?

I am concerned because, as I understand it from our briefings, decisions like that can be challenged and referred to another adviser, but the only independent recourse a claimant has if the decision goes against them is to refuse to take the job, be sanctioned and then go to a tribunal to challenge it. This is not efficient. I quite see that it is not the Minister’s intention, but how can he reassure us and those claimants that they will not be in that position?

Welfare Reform Bill

Lord Wigley Excerpts

Monday 24th October 2011 Grand Committee

I was asked by the noble Baroness, Lady Hayter, to define the seasons of the year. Clearly, spring arrives after winter and before summer, and in the case of the review it will arrive before the end of April next year. On that basis, I urge the noble Lord to withdraw his amendment.

[Lord Wigley]

I apologise very much to the Committee that my five-hour journey from Wales took six hours and that I was late in arriving. The Minister referred to a consultation with the devolved Administrations. Clearly, some of the criteria for passported benefits may vary within the responsibilities of those devolved Administrations. Will the report that he is referring to, and which he will be bringing forward shortly, cover that point in adequate depth to make sure that there is no falling between two stools?

[Lord Freud]

Yes. I thank the noble Lord for that question. I have specifically asked the SSAC to cover the point of working with devolved Administrations when it comes up with its recommendations so that will be incorporated in its original review, let alone in our subsequent review.

--- Later in debate ---

[Lord Wigley]

My Lords, I intervene very briefly in support of the amendments spoken to by the noble Baroness, Lady Hollins, and to note the very eloquent way in which she presented them. The experience that she brings to this Committee is something phenomenal. There can be no doubt whatever that the Minister would not want to be in breach of discrimination law. However it is one thing to say that and another to provide the systems to ensure that does not happen. The point of these amendments is to ensure that there is a systematic approach and that the health dimension—the professional dimension—is brought on board to ensure that reasonable adjustments are undertaken where they can be. It is not enough for us just to hope that that happens. It needs to be built into the system.

In response to this group of amendments, I hope the Minister will be in a position to tell us how the Government intend to ensure that there is a systematic approach to this, that it is not left to luck and that people who need their situations to be explained and put over professionally get that opportunity. It is clearly going to be very difficult indeed for the system by itself to have the expertise that professionals would have at hand, and we need to make sure that all the information is fed in so that everyone has a fair crack of the whip.

[Lord Boswell of Aynho]

My Lords, it is very difficult to add anything to the most eloquent remarks of the noble Baroness, Lady Hollins, and I do not intend to do so. As I have already mentioned to the Committee, I have some experience of the Conservative Disability Group, but the remarks of the noble Lord, Lord Wigley, prompt me to add two more thoughts to the pot. I should declare that I am not a professional in this area. I am fairly familiar with disability law, and of course the Minister is absolutely right that reasonable adjustments are an obligation and, indeed, an equality duty within the Equality Act for the public sector.

There are two other considerations the Minister needs to remind his officials to make sure are properly considered. One is the need at all times for public officials to act reasonably in administrative law and the second is for people, who are in a sense, when they go into an assessment, undergoing some kind of trial process, to be treated according to the laws of natural justice. The Minister has to take this trio and convince the Committee not only of his sincerity, but of his ability to effect the means by which they are delivered.

--- Later in debate ---

There are additional checks and balances. If a claimant is unhappy with specific work, search and availability requirements, they will be able to ask for another adviser to review them. This happens now under the jobseeker’s allowance, and there will be an appropriate review procedure under universal credit as well. Where a claimant does fail to meet a requirement, sanctions will not apply where the claimant demonstrates that there is a good reason. In considering whether a claimant has a good reason for a failure, decision-makers must consider any relevant matter raised by the claimant. So if the claimant submits relevant information about their health condition that has prevented them from complying with a requirement, the decision-maker must take that into account.

[Lord Wigley]

I am very grateful. Would the system that he is describing take on board the fact that the claimant may not be in a position to express, have the confidence to express, or know how to express the reasons that he or she cannot make that case? Therefore there is the need for access to professional advice.

[Lord Freud]

As I said in the previous debate, taking on board advice from a claimant’s own medical practitioner and other sources is part of the process here. To pick up the point raised by the noble Baroness, Lady Hollins, for claimants in the work preparation group, we intend to carry forward the current system of home visits to claimants with mental health problems to ensure we understand why they fail to comply. Of course, all sanction decisions can be referred to an independent tribunal, helping ensure we get it right. But equally, we intend to move away from extensive—and ultimately incomplete—lists and regulations. It is impractical for legislation to catch all the relevant matters that may arise in every single case of non-compliance, and the lengthy JSA regulations—which have matters that must and may be taken into account in determining whether a claimant has good reason—are not actually helpful for decision-makers or claimants.

To pick up the point from the noble Baronesses, Lady Meacher and Lady Hollins, on the work capability assessment, we do rely on the WCA and therefore Professor Harrington’s review is critical to help us get it right. Claimants should be placed only in a work preparation or a work-related requirements group where they are capable of meeting these very basic requirements. Once in those groups, clients will need to take account of their health condition. They are designed to take on board all the available evidence on that individual.

The noble Baroness, Lady Hollins, asked what happened with the Harrington review. As noble Lords know, we took on board the entirety of Malcolm Harrington’s first recommendations. The main thing was to empower decision makers to make the right decisions. In response to the question asked by the noble Baroness, Lady Meacher, we have introduced a mental health co-ordinator in each district who has an outward-facing role working with mental health services and an inward-facing role developing the knowledge and confidence of advisers. The other area of Professor Harrington’s advice that was taken up was on improving our communications so that claimants understand the process and the result and are able to add additional evidence if they need to. In response, we have also made improvements in mental health with mental function champions across the network at Atos. Professor Harrington is currently undertaking his second independent review. We are waiting for it, and we will then look very hard at what to do with those recommendations. We will take them very seriously.

Turning to Amendment 51E on work-focused health-related assessments, the noble Baroness, Lady Hollins, will know that these assessments have been suspended because they were not working as intended. We will re-evaluate, as I have already said. I have already offered to write to the noble Earl, Lord Listowel, on care leavers, and I will add that topic to that letter.

I do not want noble Lords to feel that I am being negative in this area, and it is over-easy to think that I am. I have valued the contributions noble Lords have made. I do not see these things as appropriate for the Bill, but I am clearly going to consider deeply the points that have been made today with the aim of applying them appropriately as we implement the system. I value what noble Lords have said. It resonates. We need to get it right. On that basis, I ask the noble Baroness to withdraw her amendment.

Welfare Reform Bill

Lord Wigley Excerpts

Tuesday 18th October 2011 Grand Committee

[Baroness Lister of Burtersett]

My Lords, my noble friend Lady Hollis has made a devastating case. I simply want to read out an e-mail that I received from someone who stands to be affected. She says:

“We have two children. Both girls are currently living in a two bedroom flat. We have been assessed by Social Services and GP as needing a three bedroom property due to our eldest daughter’s medical and welfare needs. She suffers from frequent, severe UTI infections which can leave her very poorly and in a lot of pain. She also suffers frequently from incontinence. This is having a very serious effect on her emotional well being and indeed is having a knock on effect on the whole family as we have to go in several times a night to see to our daughter to change her bedding, give her pain relief, clean nightwear, etc”.

This family had been told that they could move to a three-bedroom flat but have now been told that they cannot because of the incipient welfare reform legislation. The e-mail goes on to say:

“The new welfare legislation means that we are no longer entitled to a three bedroom even though they have written proof that we need one. This is now putting serious strain on my family and is affecting my eldest’s welfare. I cannot fight the law, I wish I was able to. I just want people to be made aware that families like mine suffer needlessly when these legislations are made. I would love nothing more than to be told my eldest can have her own room as I know her welfare would improve dramatically. But this is not going to happen”.

When I read this I thought that it surely could not be the case. However, presumably a family in this situation will not be allowed the bedroom that they need for their welfare. I feel dreadful reading such an e-mail and I hope that the Minister feels dreadful hearing it.

[Lord Wigley]

My Lords, the case made in the excellent opening speech by the noble Baroness, Lady Hollis, did not concentrate so much on the disability side, which we will come to in another bank of amendments, but was very strong indeed. Yes, the second part of Amendment 48 applies to disability, but her main thrust was on the adequacy of supply of houses.

The noble Baroness referred in particular to the situation in rural Norfolk. I can certainly vouch for the circumstances in the areas that I know in rural Wales, where this is an enormous problem because so much social and council housing in rural areas, particularly in beautiful rural areas, was bought under the right to buy legislation of the 1980s. Many of those properties that used to be social housing are now second homes. If anyone is expected to move in order to match the circumstances of the housing benefit permitted under this legislation, such people just will not find accommodation to meet those needs. It is suggested that they will find it in the private sector, but in rural areas, particularly where tourism is a major industry, the private housing sector is dominated by the rent that can be attained in the summer months from the tourism industry. Therefore, the likelihood of finding a suitable place is remote indeed.

My fear is that so many exceptions to the proposed legislation will arise that it will not be workable. We heard about the circumstances in Glasgow and the problems of disabled people who will be caught in this. With regard to the rural dimension, the one aspect that I would like to see is the building particularly of bungalows in the proximity of villages to provide the housing need, albeit that that would be a longer-term solution, as the noble Baroness, Lady Hollis, mentioned. One knows that the one category of house in overwhelming demand everywhere is the bungalow. A programme that bought land on the borders of villages that was currently outside the development boundaries and towns into those boundaries, and that was therefore possible to acquire at an intermediate price between the market price for building land and the much lower value of agricultural land, should help to provide a stimulus for the building industry and an answer, over a period of time, for some of the imbalances in the housing stock.

I realise that this does not come under the purview of the Minister, but perhaps the Government could, in the seamless web that they create, think about that possibility as a longer-term solution.

[Lord Stoneham of Droxford]

My Lords, I declare an interest as chair of First Wessex Housing Group and chair-designate of Housing 21. I also appreciate the speeches of the noble Baronesses, Lady Hollis and Lady Turner, but underoccupation is a problem when there are great shortages in housing. It is fair to accept that we need to address this problem, but it would be unfair if we do not get right the details for the transition of these proposals.

I agreed particularly with what the noble Baroness, Lady Turner, said, in that we have to accept that we are dealing with people’s homes. They may be social homes or council houses, but they are people’s homes. We are not dealing simply with a marketable commodity. Some 670,000 tenants of working age are affected by these proposals and, as the noble Baroness said, many of the people in these homes are disabled. There are two fundamental problems. One is that underoccupation does not necessarily coincide with where there is the greatest housing need. The other is that the availability of supply to correct the problem is limited. I had the figures that the noble Baroness, Lady Hollis, mentioned but in a different context; I thought that there were 180,000 social tenants underoccupying two-bedroom homes and that if we wanted to move them into one-bedroom homes, in the past year only 68,000 became available. That seems to be a critical figure.

We know that the other problem is that if we drive people out of social housing in the public sector, we may well add to public spending through the higher rents and the allowances that will have to be paid in the private sector. We want to hear from the Minister, in due course if not today, on the need to get the period of transition right to allow people to adapt and for the stock to adapt as well. We should concentrate on genuine occupation that can be corrected, and we should consider leaving out certain categories: disabled people, foster carers and those in supported housing. We should also concentrate on homes with more than two bedrooms that are underoccupied, and we should, as the noble Lord, Lord Wigley, said, look at a programme of bungalows and one-bedroom homes for older people who want to downsize. I have recently been involved in a scheme where people’s pride in their new homes is remarkable. We had to encourage them to move, but when they saw what was available they were very willing and proud to do so. However, if we concentrate now on the transition as the result of all these changes, we shall dry up the number of homes and the capacity to help people who genuinely want to move. Getting the transition right is therefore key to this change.

--- Later in debate ---

[Baroness Meacher]

My Lords, I support all the amendments in this group, but I congratulate my noble friend Lord Best on his incredibly commonsense approach to this problem. It seems that allowing an extra bedroom would probably deal with most of the tragic exceptions that people have talked about—what a straightforward way to deal with those exceptions and normal life. I cannot think of any family that at some point does not badly need an extra room, and the case was so well put.

We talk about all the amendments individually, but what is so painfully obvious is that it is the combined impact of the changes in the Bill that are going to have such a devastating effect on so many people. It feels irrelevant to talk about ESA and people being reassessed and placed on to JSA, and therefore losing a section or part of their benefits, but the individuals at the front line are going to be hit by that, then they find their housing allowances upgraded in line with CPI, then they find that their housing allowances are pegged to the 30th percentile, then find that they have an extra room. Oh my God, their housing benefit will not cover the accommodation they are in and they are going to have to think about moving.

It is the impact of so many hits that feels petrifying, and perhaps the change that frightens me more than any is the pegging of housing allowances to CPI. If that goes on longer than two years—perhaps we do not pay too much attention to it because we assume that it will not—we are talking about families and households finding every few years that they have a growing gap between their rent and the allowances they are paid for housing. They will have to move, and move, and move—is that not correct?—over a period of time, into ever more distant areas, ever meaner properties, ever smaller properties. It is difficult to imagine the psychological impact on households of all these changes.

I do not know who devised this law, but I wonder whether whoever it was stood back and thought about all that. I know, and the Minister has mentioned many times, that the driving motivation behind the reforms is to provide an incentive for people to move into work. From where I come from, dealing with people with mental health problems, one thing that stands between them and work is their level of stress and distress and anxiety.

It strikes me that if all the legislative changes go through, we will create an even bigger gap between very large numbers of people who are prone to anxiety and depression—if not psychosis and other things that are even more problematic to deal with—and the labour market. That troubles me, because I respect the Minister’s commitment to providing an incentive for people to go back into work. I also know that he is very sympathetic and understanding about mental health problems. I would be interested to know what he has to say about the apparent contradiction in what the Government are trying to do.

Another aspect of this for people with mental health problems is that to force them to move away from wherever they are—probably away from the carers who might just about prop them up and allow them to survive and carry on—is the last thing we want. The underoccupation rule impacts even more, given the other provisions of the Bill. As I understand it, young people are going to be expected, in some circumstances, to share accommodation. There are an awful lot of people with mental health problems for whom this might be quite helpful. There are others for whom it might be a complete disaster. Indeed, let us not forget to mention the potential sharer. It might be quite difficult to share with some of our folk. We have to be sensitive to the impact, and the combined and compound impact.

I sympathise with the amendments that noble Lords have tabled about disabled people who have had adjustments to their homes, and those about looked-after children. Those are obvious and glaring problems. I would like to think that the Minister will think seriously about that, in the context that I know he very well understands.

[Lord Wigley]

My Lords, I speak very briefly in support of Amendment 35, to which I have my name, to endorse entirely the comments of the noble Lord, Lord Rix, in introducing this bank of amendments, and to support the other amendments that deal with disability particularly. In doing so I should declare my interest as vice-president of Mencap Wales. In fact, at the Mencap annual conference in Warwick on Saturday, there were people who asked specifically about these matters. They said, “They have taken away from us home ownership for people with long-term disabilities, and now they are going to start clobbering us on housing benefit, where people with disabilities may be in a particularly vulnerable position”. I should therefore like to ask the Minister, so that I can respond to people who raise these questions with me: do the Government still believe in home ownership for everybody, and if so, does that include people with long-term disabilities? If the Government, having taken away the previous scheme, are not going to put something in its place, surely that is a straight contradiction of what the party opposite has always put itself forward as believing in?

Secondly, with regard to people with disabilities and housing benefit—the amendments before us would make exceptions for them—I hope that the Minister will be able to spell out how he will ensure that they do not suffer. If the amendments are not acceptable, I hope that amendments will come forward from the Government on Report. If not, I hope that there will be an opportunity to vote on these matters to show exactly where each of us in each of our parties, including the coalition partners, stand on such a basic issue.

[Baroness Hollins]

I, too, support Amendment 35, as introduced by my noble friend Lord Rix. As we have already heard today, tidy laws are not always fair laws. I am concerned about some exceptional people whose needs cannot neatly be described and I hope that common sense will prevail.

I shall give the example of a young man with autism and learning disability, Theo. Since early childhood, Theo has loved and become very knowledgeable about cathedrals, churches and architecture. He is also a man with complex impairments and a history of behaviour which has challenged every shared setting he has lived in. With specialist advice from Housing Options, and support and endorsement from social services, his parents set up a safe and individualised housing and care package for him.

The Government’s view may now be that it has never been the intention that SMI would cover all a person’s housing liabilities, but Theo’s shared-ownership mortgage was offered precisely on the basis that it would cover the mortgaged part of his housing cost, as was DWP policy at the time. The past nine years of Theo’s life have been built on that. His home has provided the all-important stability that someone with autism needs; and his disabilities combine to make change much more disturbing than we would find it.

Theo has an interest-only mortgage, so the possibility of the acquisition of a valuable capital asset does not apply in his case. With careful management by his parents, he has been able to lead a happy life at a much lower cost to the public purse than the alternative arrangement of a secure hospital. However, the new FSA rules require mortgage-lenders to set aside more capital and to treat mortgages on shared-ownership properties as 100 per cent mortgages. The result is a sudden gap between the rate at which lenders have to lend—for example, 6 or 8 per cent —and what the new SMI rate, which I think is 3.63 per cent, will cover. In Theo’s case, this leads to a shortfall of £200 per month. You can imagine that the arrears are already quite high. A new mortgage would be at an even higher rate, but he would then have to find a 25 per cent deposit for his property. He does not have the money to negotiate another mortgage.

There has been quite a bit of publicity about the adverse effect of this reform on HOLD. Experienced housing experts say that fewer lenders are likely to want to deal with disabled applicants seeking this solution to support a non-institutional life.

Ageing parents of disabled adults have followed similar paths with the help of enlightened housing associations. Those parents have been making responsible arrangements in their own lifetime, hoping for some assurance of long-term stability and security for their child. Instead, Theo's parents now face the prospect of seeing Theo’s distress at being uprooted from his home and moved, probably, to an inappropriate and less sensitive institution, which will be much more costly.

As the noble Lord, Lord Rix, pointed out, there are probably about 1,000 customers with learning disabilities—0.4 per cent, I understand, of the total caseload looked at by the impact assessment. Some of those administering HOLD have suggested ways in which the cost of continuing higher-rate payments for this group of disabled people could be contained, but it would require acceptance that there are indeed exceptions to the rule.

Since the Poor Law 1601, society has tried to tidy away people whose needs do not fit present-day norms, but in today’s more enlightened society we have made huge strides towards creating an inclusive society in which every person's humanity and dignity are respected and in which they have a place regardless of the extent of the difference that the person presents. However, these gains are quite fragile and we need look no further than Winterbourne View to be reminded of the previous scandals in mental handicap hospitals such as Ely and Normansfield in the late 1970s. Surely, we must now realise that without adequate advocacy and diligence we could again allow such inhumane provision to be re-created—people shunned by society and placed out of sight and out of mind at considerable expense but in the interests of tidiness. The test of a humane society is how it treats its most vulnerable members.

I had little awareness of the lives lived by some people with learning disabilities until I had a disabled child. My eyes were opened. I should like the Minister to consider using the Bill to reinstate SMI at the higher level for people such as Theo, which would allow them the opportunity to live with dignity in their own homes.

--- Later in debate ---

[Lord Freud]

By the time we get to this again, I will come back with that answer.

[Lord Wigley]

My Lords, I speak at the request of my noble friend Lord Rix, who has had to leave the Committee, because we have now been going for well over four hours. I think he anticipated that we would have finished before now, and he has had to go to a 7.30 pm engagement outside the House. He has asked me, as I have my name on the amendment that led this bank of amendments, if I could respond briefly.

In doing so, I will touch on three points. In reverse order, taking up the point made by the noble Baroness, Lady Hollis of Heigham, a moment ago, with regard to the cost implication of the discretionary payments that are to be made by local government, has an assurance been given by the devolved Administrations that they have the resources to be able to do this? We are dealing with a non-devolved subject but are looking to devolved authorities, from a devolved budget, to fund the counterbalancing money that is required. If that answer is not available now, perhaps there will be an opportunity at some later stage to deal with that. It is clearly a matter that will be of concern, not only to the devolved Administrations, but to local authorities in Wales and Scotland.

[Lord Freud]

I can answer the noble Lord pretty rapidly on that. This is not a devolved area, so the discretionary housing payments are not devolved.

[Lord Wigley]

Of course—that is the whole point. The housing benefit is not a devolved area, but local government money is, unless there is going to be payment made from Westminster sources—Whitehall sources—to the local authorities in Wales. From the indication I get, payments will be made directly to local authorities, or via the Assembly to local authorities. In which case, fair enough, if enough money is going to be there; but if it has to come from their general pools, then that is from a devolved budget and will cause them problems.

[Lord Freud]

All I can confirm is that, just as anywhere else in the country, in those Administrations, the money will go by formula to those local authorities, in the same way that it currently does.

[Lord Wigley]

I accept entirely, of course, that housing benefit is run by the local authorities as a non-devolved portfolio, coming under Whitehall. However, the general funds that they have, unless there is additional funding coming from Whitehall to those local authorities and bypassing the Assembly, it would otherwise come out of the Assembly budget. All I was asking was whether that had been agreed with either the Assembly, or in the case of Wales, the Welsh Local Government Association? The Minister might be able to confirm that.

[Lord Freud]

What I can confirm is that the DHPs go directly to the local authorities, not through the local Assemblies.

[Lord Wigley]

Therefore, will any additional resources for discretionary payments that will be made, in line with the numerous references to discretionary payments that we have heard over the past few days, go directly and be over and above the payments that will otherwise be made.

[Lord Freud]

My Lords, yes.

[Lord Wigley]

We can put a marker down on that clear answer, for which I am very grateful.

Secondly, on one of the banks of amendments that dealt with disability and tried to get exclusions for people in certain categories of disability, the Minister, if I recall rightly, said that it would cost far too much, possibly £180 million. If that is the cost of excluding disabled families from the provisions of the Bill, it is, equally, the additional cost being faced by disabled families as a consequence of the Bill. That is an enormous cost. If it is a large sum for the Treasury budget, how much larger a sum must it be for disabled people trying to find it from their own domestic budgets? That is something that I suspect we shall need to come back to for clarification on Report. I hope that will be possible. I do not expect the Minister to respond at this point.

My third point is in regard to Amendment 35 in my name and that of my friend, the noble Lord, Lord Rix, which concerns home ownership among people with long-term disabilities. The Minister mentioned that only 400 people were affected by this. I am sure he is not decrying the importance of the scheme for the 400 people that it has helped; every single one is important in its own right.

[Lord Freud]

My Lords, may I make that absolutely clear? There are 430 people currently on the HOLD scheme. The bulk of them have an arrangement with a mortgage provider, Kent Reliance, which means that they can continue to pay the required rate of 3.63 per cent. Therefore, only a handful of people on the HOLD scheme are affected by any change.

[Lord Wigley]

Yes indeed, those 430 may well be safeguarded but there is the question of whether other people, who might in the past have come on to that scheme, will not be able to do so in the future. More importantly, the Minister referred to having had a meeting yesterday with people from Mencap to discuss this. From having a brief word with the noble Lord, Lord Rix, before he left, I understand that the people at Mencap are hoping that the Minister will at some stage, if not today, come back with some provision that will cover the requirements of this important group of people who are being helped by the scheme. I do not know whether they misunderstood that or whether the Minister will look at it again before Report to see what can be done. However, I very much hope that he will take on board the serious points that have been made by the noble Baroness and others, including the noble Lord, Lord Rix, about this important group.

We have gone well beyond our time. I put it to noble Lords that we ought to consider whether this is the most sensible way of undertaking our responsibilities, when the Committee runs for more than four hours without a break, we have disabled colleagues here and there are disabled people who want to follow our proceedings. I beg leave to withdraw the amendment.

Amendment 35 withdrawn.

Welfare Reform Bill

Lord Wigley Excerpts

Monday 10th October 2011 Grand Committee

[Lord Wigley]

My Lords, I support this amendment very warmly indeed, and put to the Minister circumstances that arose frequently in the area that I used to represent in the other place and that still arise in rural areas, not only in Wales but also in areas such as the Lake District and Cornwall, where it is very difficult for young people to buy a first home. Indeed, it is so difficult that unless a parent is in a position to make some contribution towards a deposit, it is next to impossible to buy a first home. The question that goes through my mind is: if a parent has money allocated for this purpose, is he or she going to pass it to their offspring to buy a house, knowing that if it stands in their offspring’s name in a bank it may prevent that person from getting benefits?

In areas such as those to which I have referred, the major industry is often tourism, which is highly seasonal. This means that people are moving in and out of work frequently. If one takes the combination of ultra-high property values, which have often arisen because of the pressure of second homes, the relatively low income levels that obtain within the economy, and the seasonal nature of the employment available, particularly for young people looking for their first job—and one wants to encourage them to take every job opportunity there is—one surely has to make sure that the rules and regulations do not militate against them getting their foot on the first rung of the ladder in order to be the owner of their home. I put it to the Minister that somehow or other that has to be safeguarded within the system.

[Baroness Sherlock]

I would like to make one brief point about the sums of money that are increasingly needed to save for a house. It was reported in the Guardian on 17 September this year that the average deposit has gone up tenfold in the last 20 years, from £6,793 in 1990 to over £65,000 now. The same article went on to quote a banker from First Direct, which I presume must know these things, who said:

“The average deposit … has actually risen more than twice as fast as house prices and almost four times as fast as income”.

Could the Minister therefore think for a moment about whether the inflation in the savings limit properly takes account of the specific house-related inflation, and within that the specific deposit-related inflation, that we are seeing?

Welfare Reform Bill

Lord Wigley Excerpts

Thursday 6th October 2011 Grand Committee

[Lord Wigley]

My Lords, I will intervene briefly on this. I support very much the direction we are taking. However, I am not quite sure that I fully understand the words “to support work”, as there is more than one interpretation of this. There is clearly the question of supporting people, particularly disabled people, in a way that makes it practicable for them to work. However, there is another question: that of supporting the availability of work. As we heard a moment ago, that is the challenge in many areas, particularly the old industrial areas. It is true in parts of Wales, northern England, Scotland and Northern Ireland, where there has historically been a greater labour reserve because people are encouraged not to be registered for work. Of course, there have also been the problems of industrial disease and accidents which have led to a large body of people who would need a considerable amount of support to be in work.

As it happens, many of those areas are the very areas where there is a lack of work opportunities. We heard a Minister going to Merthyr Tydfil a few months ago and telling people to get on their bikes. That will not actually solve the problem. We are talking of catchment areas with perhaps 30 or 40 people chasing every available job. Side by side with encouraging people and giving them the financial or other support that is necessary to enable them to work, therefore, there is the question of making jobs available within a reasonable distance for those people. If we do not do that, the whole thing becomes a rather superficial exercise. I do not quite see how the Government are going to match that up: in order for this legislation to deliver what they want, there must be those opportunities.

It strikes me that there are three factors that need to come together to provide job opportunities. The first is the employer. Secondly, there is the person looking for work, who may need help, particularly if he or she is disabled. Thirdly, there is the state. The circumstances of employers will vary considerably from area to area. In an area where there is lower unemployment, the employer may take on people and give a chance to people with disabilities or difficulties who might not be taken on elsewhere. Therefore, I put it to the Minister that this raises the question of whether the Government’s policy is going to be uniform throughout all areas, or whether there will be a flexibility that enables the Government to give greater help to encourage employers to take on people in areas where there are high levels of unemployment, where they might not otherwise be inclined to do so if the potential employee has challenges that might influence, or be perceived to influence, the way in which he or she undertakes their work. In other words, a lot of questions arise in this context—perhaps not directly from the amendment, but from associated matters.

[Lord Beecham]

Does the noble Lord agree that one factor that might influence the situation is the question of travel—not in the sense that my noble friend Lady Hollis mentioned, but as a result of the impact of housing benefit changes? These might well lead to people moving away from where they are currently living, and where they might work, to much further afield, particularly in London. Would that be a consideration that needs to be taken into account?

--- Later in debate ---

[Lord Wigley]

Yes. That was a point I made on our previous day in Committee: there will be an attack on labour mobility. That clearly is not the Government’s intention, as their hope is that mobility can be encouraged. However, the interplay of housing benefit can have a direct bearing on that, and may undermine some of the objectives that they quite rightly have in mind. Practical questions like this have to come together with the safety net of social security provision provided by the state.

[Lord Newton of Braintree]

My Lords, I shall chip in briefly. First, I apologise that I was a little late and did not hear all the remarks of the noble Lord, Lord McKenzie. My lateness has something to do with the fact that I am myself a little bit disabled—in fact, I should probably declare an interest in the matter. That leads me to say that I hope it may be understood if occasionally I seek to intervene from a sedentary position in order to avoid the considerable effort of standing up.

I do not intend to follow the noble Baronesses—not because I do not have sympathy with what they are saying, but because I suspect that we shall have considerable opportunities to return to this matter in a more specific way later in the Bill. I do not agree with the remarks of the noble Baroness, Lady Hollis, about the Prime Minister—I had better make that clear, just to show that I am occasionally a loyalist—and I do not go along with her remarks about the Administration in which I was Secretary of State for Social Security. The notion that I was trying to encourage people on to invalidity benefit in order to massage the figures does not correspond with my recollection—or, I suspect, with that of the noble Lord, Lord Kirkwood. However, on the more positive side, I agree with the point about carers in general, which we need to bear in mind throughout these proceedings—although I would have taken it to be embraced by the second half of the noble Lord’s amendment.

As for the amendment itself, I rather doubt that it is going anywhere, because there seems to be a division even on the opposition Front Bench about what its terms should be. It was being rewritten as we went along. It may be that the Minister will feel that its wording is not perfect. I hope that we will not be told that it is not necessary because that is what the Government are going to do anyway. If that is the case, they might as well please us by writing something in that says what they are trying to do.

--- Later in debate ---

Consultation with the devolved authorities is essential not just in the context of the amendment drafted by my noble friend Lord Kirkwood, but in the context of every aspect of this Bill. I want to know from the Minister what consultation has already been undertaken with the authorities in Scotland, Wales and Northern Ireland and what consultation with them is planned. The amendment provides a peg to ask those questions, for us to discuss this issue and, I hope, for us to get some answers from the Minister. I beg to move.

[Lord Wigley]

My Lords, I hope I will not distress my noble friend Lord Foulkes unduly by supporting what he said. I preface my remarks by supposing that there will not have been the studies in the National Assembly in Cardiff that he was calling for in Edinburgh, but I will not castigate the Labour regime in Cardiff for not undertaking such studies. The point, however, is a material one. In the eight months that I have had the opportunity to speak in your Lordships’ House, I have realised that in many Bills—I think of the Police Reform and Social Responsibility Bill, the Localism Bill and the Public Bodies Bill—there are implications for the devolved Administrations as a result of changes in legislation here that do not always become apparent on first appearance.

In the context of the knock-on effects of this Bill, there will most certainly be implications for the housing sector because most of the responsibility for housing rests with the National Assembly, but housing benefit does not, and there is going to be interplay. There will be an impact in the realm of carers. The initiatives taken in Wales have not been quite as radical as some of the ones taken in Scotland, but none the less there is a bearing if the state takes certain responsibilities in Scotland, Wales and Northern Ireland that are not undertaken in England with regard to the support that is given. There has to be at least an understanding of how those two factors may work.

With regard to the opportunity for work and training, again responsibility will lie with the devolved Administrations. There needs to be an approach across government to legislation that is going through Westminster in general to take on board the knock-on effects. There needs to be a systematic approach to co-ordinating them. It may well be that your Lordships’ Chamber has a role to play in that.

The system of devolution that we have is unbalanced. I can well understand that that causes difficulties for those who are framing legislation in London when the interpretation and the interactions will be different from area to area. What has also become apparent to me is that in the context of matters that are totally non-devolved, there is still an implication for the National Assembly, and that in matters that are totally devolved, there is an implication here, from cross-border issues, from consequences of the Barnett formula and so on, where there is an interplay. Therefore in both areas one cannot just assume that there is a sealed border and there should not be a discussion.

I would have hoped that, in raising the issue at this stage—and it could be raised at any stage going through this Bill—there will be the approach of thinking “is there going to be any direct bearing with regard to the legislatures in Scotland, Wales and Northern Ireland?” If so, these can then be built in and assurances given at the appropriate time that they will be taken on board. That would be helpful for the progress of the Committee.

[Lord McKenzie of Luton]

I thank my noble friend Lord Foulkes for picking up the baton from the noble Lord, Lord Kirkwood, so that we have the chance to have the explanation of the points that were put by my noble friend and by the noble Lord, Lord Wigley. Doubtless the Minister will be able to tell us what consultation and engagement has taken place, but I think that the request is that it is not simply done at some formal stage, perhaps when policy is being formulated, but that we consider it as an integral part of our consideration of this Bill. If we can get nothing other than that from this amendment it will have been worthwhile preserving it for our brief debate.

[Lord Freud]

My Lords, I will deal with Amendment 3, which is the one noble Lords have concentrated on. Amendment 3 would introduce a requirement to consult the devolved Administrations before the introduction of universal credit. I must point out that social security is a reserved matter in Great Britain but the implementation of universal credit will have an impact on some matters of policy which are devolved, for example, housing, skills provision and childcare. For that reason, we are working closely with the devolved Administrations on the implementation of measures in the Bill and will continue to do so to ensure that the introduction of universal credit goes smoothly.

We have been discussing aspects of the Bill since well before its introduction during the latter part of 2010. The Secretary of State and I have had a number of meetings with Ministers in the devolved Administrations. A formal role has also been established for the Scottish, Welsh and Northern Irish Governments and for the Scottish and Welsh local authority associations on the universal credit senior stakeholder board. We have a concordat between DWP and the Scottish Government that sets out the commitment on communication and consultation; indeed, the Secretary of State met Scottish Ministers most recently a fortnight ago. I therefore hope that noble Lords will be reassured with regard to the concerns they have expressed. We are addressing these issues, we are consulting thoroughly, and on that basis—

[Lord Wigley]

Before the Minister sits down—although he perhaps cannot give a reply now—would he consider at some stage during the passage of this Bill the possibility of introducing a new clause or subsection? This could perhaps come towards the end, where questions such as extent arise, and propose that there should be a duty on Ministers to consult not only with regard to the primary legislation, but with regard to the impact of the orders that will be coming from the primary legislation. If it is in the Bill, there will be no excuse for not consulting at the appropriate time.

--- Later in debate ---

[Lord Freud]

No, we had anticipated that this impact assessment would come out during Committee stage, and I think we said that. I hope I gave noble Lords a reasonable clue when I suggested the opportunities we might have to debate it because I referred to a couple of clauses that, depending on our speed of progress, we will get to soon.

I shall return to the main topic and the question of pensioners. Noble Lords will be aware that there have been persistent concerns about the low level of take-up of council tax benefit among pensioners. I know that the noble Baroness, Lady Turner, has had this as her absolute central focus. As the noble Lord, Lord McKenzie, pointed out, there was cross-party consensus on the word “rebate” a couple of years ago. Many have argued that the reasons that pensioners are reluctant to claim are because it is an income-related benefit and because they believe that the process for claiming it is complicated and intrusive. We believe that there is a strong and persuasive case that council tax support for pensioners will be better delivered through localised schemes of support. Noble Lords will have seen that DCLG’s consultation paper stresses that the position of current and future pensioners should be fully protected.

I will take the opportunity to answer the specific questions raised by my noble friend Lord Newton. The allocation of cash to local authorities will be based on existing CTB expenditure, less 10 per cent. The current cost of delivering housing benefit and CTB is £500 million per year. I am not able to say what the new system will cost, mainly because the consultation that DCLG is conducting has not been concluded.

My noble friend raised the appeal process. The consultation paper does not set out a final view on what that process might be, and it is the subject of one of the consultation questions. The nature of the appeals system will depend on the final design of the system.

To summarise, the approach the Government are taking on the aspects that this amendment raises is the right one. Therefore, I thank noble Lords—

[Lord Wigley]

Is the Minister going to respond to the point made by Lord German earlier about the application in Wales, Scotland and Northern Ireland? I am sorry to come back to that like a bad penny, and I will try not to do it all the time, but in this instance, it is of direct material consequence, particularly this week when one is aware that the money to freeze council tax, so far as England is concerned, when transferred to Wales, will not be used for that purpose. Will the resource that the Minister sees going to local government in Wales go directly to local government or via the Assembly? Has he discussed this with the Welsh Local Government Association and Assembly Ministers?

[Lord Freud]

My Lords, without being over-coy on that question, this matter is out for consultation and we expect the responses from Scotland and Wales to be incorporated as part of it. So the answer, I guess, is that it will be looked at in that context. With that, I ask the noble Baroness to withdraw the amendment. I am sure that we will return to the some of the substance later.