Social Security Benefits Up-rating Order 2024

Viscount Younger of Leckie Excerpts

Tuesday 27th February 2024 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Social Security Benefits Up-rating Order 2024.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, in my opinion, the provisions in the instrument are compatible with the European Convention on Human Rights. The Social Security Benefits Up-rating Order increases relevant state pension rates by 8.5%, in line with the growth in average earnings in the year to May-July 2023. It will also increase most other benefit rates by 6.7%, in line with the rise in the consumer prices index in the year to September 2023.

The order commits the Government to increased expenditure of £19 billion in 2024-25. It ensures that state benefits maintain their value relative to the increase in the cost of goods and services. It means that most state pensions will gain value relative to that increase. Indeed, the proposed increase to state pensions would be the second highest on record—second only to the increase last April.

This will meet the Government’s commitment to the triple lock, benefiting pensioners who are already in receipt of basic and new state pensions, and younger people who are building up future entitlements as a foundation for private saving. It will raise the level of the safety net in pension credit beyond the increase in prices, and it will maintain the purchasing power of benefits to help with additional costs arising from disability.

For those receiving support linked to participation in the labour market, the Government announced a range of employment and conditionality measures at the Autumn Statement. These measures maintain and improve work incentives. This allows us now to strike a balance in support of those who are in low-paid work, who are looking for work or who are unable to work by linking the increase in the rates of universal credit to the increase in prices.

I will now address state pensions in more detail. The Government’s commitment to the triple lock means that the basic and full rate of the new state pension are uprated by the highest of the growth in average earnings, the growth in prices or 2.5%. This will be 8.5% for 2024-25, in line with the conventional average earnings growth measure. As a result, from April 2024, the basic state pension will increase from £156.20 to £169.50 a week, and the full rate of the new state pension will increase from £203.85 to £221.20 a week. All additional elements of the state pension will rise by 6.7%.

The Government are committed to supporting pensioners on the lowest incomes. The order therefore also increases the safety net provided by the pension credit standard minimum guarantee by 8.5% from April 2024. For single pensioners, this means it will increase from £201.05 to £218.15 a week, and for couples it will increase from £306.85 to £332.95 a week.

I turn now to universal credit, jobseeker’s allowance and employment and support allowance. The Social Security Administration Act 1992 gives the Secretary of State discretion on whether to increase the rates of benefits such as these, which are linked to participation in the labour market. Given the employment and conditionality measures I mentioned earlier, he has decided to strike a balance in support by also increasing the rates of these benefits by 6.7%, in line with the increase in the consumer prices index.

As a further measure to reinforce work incentives, the monthly amounts of universal credit work allowances will also go up by 6.7% from April 2024. They will increase from £379 to £404 a month for those also receiving support for housing costs, and from £631 to £673 a month for those not receiving support for housing costs. Noble Lords are aware that these are the amounts a household can earn before their universal credit payment is affected if they have children or if they have limited capability for work. The 6.7% increase will also apply to statutory payments, such as statutory maternity pay, statutory paternity pay and statutory sick pay.

I turn finally to benefits for those with additional disability needs and those who provide unpaid care for them. The rates of personal independence payment, disability living allowance and attendance allowance will increase by 6.7% from April 2024, in line with the increase in the cost of goods and services. As we have debated previously in other contexts, the Government recognise the vital role played by unpaid carers. This order also increases the rate of carer’s allowance by 6.7%, from £76.75 to £81.90. Unpaid carers may also access support through universal credit, pension credit and housing benefit. All these include additional amounts for carers, which will also increase by 6.7%. For a single person, the carer element in universal credit will increase from £185.86 to £198.31 a month. The additional amount for carers in pension credit and the carer premium in the other income-related benefits will increase from £42.75 to £45.60 a week.

In conclusion, the draft Social Security Benefits Up-rating Order 2024 implements the Government’s commitment to the triple lock. It provides for a real-terms increase in the value of the safety net in pension credit, it maintains the purchasing power of benefits for additional disability needs and for people providing unpaid care to people with those needs, and it strikes a balance in universal credit by maintaining both work incentives and the purchasing power of benefit income. I commend this instrument to the Committee.

[Baroness Lister of Burtersett (Lab)]

My Lords, I of course welcome the inflation-proofing of benefits and the temporary lifting of the local housing allowance freeze in April, but—I fear this speech is a series of “but”s—I find it, frankly, insulting to those affected. I should say that the Minister is not included in this but, from the Prime Minister down, the uprating is constantly lauded by Ministers as a record amount, an additional support, as if it represents a great act of generosity which somehow justifies the lack of action on a number of other fronts. The inflation-proofing of benefits should be the default position, avoiding the months of speculation, fuelled by government sources, that have caused considerable uncertainty and anxiety for benefit recipients in and out of work.

Moreover, there is a number of reasons why the increase in line with inflation is far from generous. The Resolution Foundation points out that the uprating will do no more than restore benefits to their real value on the eve of the pandemic. While there were flaws in the cost of living payments, which we discussed last year, their loss now means that many households on universal credit will be worse off in cash terms. The foundation estimates that the typical household in the poorest quarter of the working-age population could face an income fall of 2% next year. The following year, on current assumptions, private renters will face a further freeze in the local housing allowance, which, according to Citizens Advice, is an important factor in the increase in the number facing a negative budget—that is, where income does not cover essential spending.

There is also the prospect that the uprating could coincide with the abolition of the household support fund, which has acted as both a lifeline and a sticking plaster for the holes in the social security safety net. I know that the Minister can say nothing more than that this is kept under review, but local authorities, charities and potential beneficiaries need a bit of certainty, rather than to wait for the Budget, which is only a month before the outcome of this review takes effect. I really do not understand how he can tell me in a Written Answer that the Government do not have robust data on the number of English local authorities that have closed their local welfare assistance schemes which, in his answer to my earlier Oral Question, he prayed in aid, should the household support fund be scrapped. Surely, such data should inform any review of the future of the fund. As it is, we know from End Furniture Poverty that at least 37 authorities have closed their scheme.

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[Baroness Sherlock (Lab)]

My Lords, I thank the Minister for introducing this order and all noble Lords who have spoken. As he has explained, the Social Security Benefits Up-rating Order will increase most working-age benefits in line with CPI. We too welcome this instrument, because of course we want to see social security keep pace with prices, particularly at a time of spiking inflation and economic instability. That used to be the norm among both Labour and Conservative Governments, of course, but the past decade has seen a marked change.

There were of course the years of shame between 2013 and 2020, when most working-age benefits and tax credits were either frozen or uprated by small amounts, such as just 1%. Although today we are back to uprating mostly by CPI and occasionally by earnings, as my noble friend Lady Lister said, once again that uprating has been preceded by a period of speculation, which is deeply unhelpful. I can assume only that this is driven from somewhere inside the Government, because it happens too regularly. The speculation suggests that maybe this year the uprating will not be by the full amount or maybe will not happen at all.

As my noble friend mentioned, that speculation causes real stress and worry for people who depend on benefits and tax credits to survive. I begin to wonder: is it a strategy to allow Ministers the option of either freezing benefits or not uprating them fully so that, if they then finally do the right thing, people are supposed to be suitably grateful? As my noble friend Lady Lister pointed out, it is good that benefits are being uprated, but it is not an act of unusual generosity; it is simply a decision not to cut the value of benefits during a cost of living crisis.

This instrument, as we have heard, also increases the state pension by earnings in line with the triple lock. I accept the distinction that my noble friend Lord Davies helpfully made. The rates of basic and new state pensions will rise by 8.5%, as will the standard minimum guarantee in pension credit and the higher rate of widows’ and widowers’ pensions in industrial death benefit. However, this does not apply to a number of the others. I will be interested in the Minister’s response to that. In particular, can he explain the position on the deferred state pension? If someone chooses to defer their state pension and the pattern is that the deferred amount is uprated by CPI rather than the triple lock, are they made aware of that? When people make a decision about deferral, do they understand the consequences?

I had some other questions on pensions and pensioners but I was entirely thrown by the decision to separate these two instruments this year. Most years, we do them together in a single block, so I wrote a wonderful speech waxing lyrical and weaving in pensioners and old age, but now here I am. I shall come back, if the Minister will indulge me, to a couple of more general questions on pensioners when we come to debate the next instrument.

The context for this year’s uprating, as my noble friend Lady Lister expounded in some detail—aided ably by the noble Baroness, Lady Janke—is absolutely brutal. I will not repeat the extensive critique that my noble friend made or her unpacking of the economic climate in which so many families are living, but it is brutal. The basic fact is that there are now more than 4 million children living in poverty. There are 400,000 more children living in poverty now than when Labour left office in 2010.

One of the things that bothers me about this is that, whenever somebody raises this, the Minister—I know it is in his brief—will at some point in the response use the line that the Government believe that work is the best route out of poverty. Yet, clearly, the facts speak for themselves: more than two-thirds of children who live in poverty have parents in work. Something in that picture does not work. It is something that all of us in politics must address.

We in Labour have been looking at what we would do. We have a plan to give people a better life, so that they are able to make ends meet and have a good start for their children. We are looking at making sure that there is a breakfast club in every primary school and at giving people access to cheaper energy and an insulated home. We will reform universal credit, jobcentres and employment support so that people can get a better job with better pay. We will also have a child poverty strategy. Can the Minister tell the Committee in his response what the Government’s strategy is? What is their plan to do that? Other than simply declaring that work is the best route out of poverty, what is the Government’s plan to deal with the challenge of child poverty today? I look forward to the Minister’s response.

[Viscount Younger of Leckie (Con)]

My Lords, I thank all those who have spoken in this short debate. Before I attend to the number of questions asked and subjects raised, I would like to say at the outset—I normally do this but, today, I give special feeling and meaning to it—that this Government really do fully recognise the challenges facing people across the country due to the higher cost of living.

Although inflation is trending in the right direction, with the Bank of England now forecasting a fall to a target rate of around 2% in three months’ time, I acknowledge that pressures on household budgets very much persist. I saw this for myself in a recent visit to the Earlsfield Foodbank. The Government are not complacent about such matters; I hope noble Lords will recognise that the Government have taken action on a number of fronts to address these concerns, which were raised by a number of Peers—four, to be precise—this afternoon. I may not be able to answer all the questions but I will do my very best.

Let me start at the outset—I do not think I have done this before—by saying that, although I acknowledge the remarks made by the noble Baroness, Lady Lister, I am generally disappointed that every single item was a negative. I am disappointed that nothing she said seemed to support what we have done in these regulations or what we are trying to do. We really are trying. There was a long litany of faults coming from the Government: that the uprating was not enough; on the loss of the cost of living payments; on the freeze in the LHA, which is all for the future as we do not like where we stand on that yet; on the household support fund; and on the benefits cap review, including why it was not being done.

The noble Baroness is right to ask questions but I say gently that there is no mention of the genuine headwinds that all Governments have been facing. This Government have not been alone in the experiences of the pandemic and coming out of it, as well as of the war in Ukraine. There was no indication of these whatever. It is a bit disappointing. I know that the noble Baroness will understand why I have said these things but I thought it would be worth mentioning them.

[Baroness Lister of Burtersett (Lab)]

I am sorry to interrupt but I started by saying that I welcomed the inflation-proofing. That is a positive. I then warned him by saying, “All the ‘buts’ are coming, I am afraid”, but it was in the context of welcoming.

[Viscount Younger of Leckie (Con)]

I appreciate that from the noble Baroness. We have undertaken a number of debates together; I hope that she did not mind me mentioning it.

However, questions are questions; I will start by attempting to answer one of them. After each uprating, household income will go down by 2% because of the ending of the cost of living payments. At the moment, the Government have no plans to extend the cost of living payments past the 2023-24 round of payments. Responding swiftly and decisively to the cost of living pressures has been a key priority for the Government. Over the past two years, the Government have demonstrated their commitment to supporting the most vulnerable by providing one of the largest support packages in Europe. Taken together, support to households to help with the high cost of living is worth £104 billion over the period 2022-23 to 2024-25.

As was mentioned earlier, reducing inflation and growing the economy are the most effective ways to build a more prosperous future for all. This Government are committed to halving the rate of inflation; they have pretty well achieved that. However, to be helpful to the noble Baroness, an evaluation of the cost of living payments is under way. This seeks to understand their effectiveness as a means of support for low-income and vulnerable households. This will be made public when it is ready.

The noble Baroness mentioned the household support fund. She probably second-guessed my answer, which is that this is kept under review in the usual way. It has been used to support millions of households in need with the cost of essentials. For example, 26 million awards were made to households in need between 1 October 2021 and 31 March 2023. More than £2 billion in funding has been provided to local authorities via the household support fund since it began—that is, October 2021. More than 10 million awards were made between 1 October 2022 and 31 March 2023.

The noble Baroness, Lady Lister, asked why we are not going to increase the benefit cap. She cited the fact that the Secretary of State has an obligation to review at least once every five years. We believe that there has to be a balance. The benefit cap provides a balanced work incentive and fairness for hard-working taxpaying households, while providing a safety net of support for the most vulnerable. She will know that the Government increased the level significantly from April 2023 following the review in November 2022. The proportion of all working-age households capped remains low, at 1.3%, and these capped households will still be able to receive benefits up to the value of gross earnings of around £26,500, or £31,300 in London. For single households, this is around £15,800, or £19,000 in London.

The noble Baroness, Lady Lister, asked about benefits levels and how to measure them. There is no objective way of deciding what an adequate level of benefit should be as every person has different requirements depending on their circumstances. However, we will spend £276 billion through the welfare system in Great Britain this financial year, including around £124 billion on people of working age and their children. Over the past two years, the Government have demonstrated their commitment to supporting the most vulnerable by providing one of the largest support packages in Europe, which I mentioned earlier.

The national living wage, which I also want to mention, is set to increase this April by 9.8% to £11.44, on top of the increase in April 2023 of 9.7%. This represents an increase of over £1,800 in the annual earnings of a full-time worker on the national living wage, and it is expected to benefit over 2.7 million low- paid workers.

Guaranteed Minimum Pensions Increase Order 2024

Viscount Younger of Leckie Excerpts

Tuesday 27th February 2024 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Guaranteed Minimum Pensions Increase Order 2024.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, this order was laid before the House on 15 January. It is a routine and quite technical annual order and is usually debated alongside the Social Security Benefits Up-rating Order 2024, which we have just finished discussing. Unusually, this year, we are running the orders one after the other, as determined by the Whips’ Office. I hope the Committee will agree that this order is not considered too controversial.

The order sets out the annual amount by which the guaranteed minimum pension—the so-called GMP, which is part of an individual’s contracted-out occupational pension earned between April 1988 and April 1997—must be increased. This year, occupational pension schemes that provide GMPs are required to increase GMPs earned during that period which are in payment by 3%.

I start by giving a bit of background on GMPs. They were created to help employees save income for their retirement but in an affordable way. The state pension used to be made up of two parts: the flat-rate basic state pension and the earnings-related additional state pension. The flat-rate basic state pension was funded through national insurance and paid at the full rate to those with sufficient qualifying years of national insurance contributions, or pro rata for those with a partial record.

The second part of the state pension, the additional state pension, was linked to a person’s earnings. The higher earnings-related national insurance contributions applied to both the employee and the employer and built entitlement to an additional state pension, based on the employee’s earnings. The intention was to ensure that as many people as possible were able to save towards an earnings-related work-based pension that would supplement their basic state pension in retirement.

The additional state pension was introduced in 1978. At the time, many employers were already offering their employees a workplace occupational pension through their own scheme. Therefore, having both an earnings-related additional state pension and a company occupational pension was seen as dual provision. It was overly complicated and potentially unaffordable for employers and employees.

The then Government therefore decided to deal with this through the system of contracting out and the associated provision of guaranteed minimum pensions. Between April 1978 and April 1997, employers sponsoring salary-related schemes could contract their employees out of the additional state pension through membership of the company pension scheme, as long as that pension scheme paid its members a guaranteed minimum pension as part of their occupational pension from the scheme.

The idea was that, rather than paying additional national insurance to the state, people would instead build up a similar amount of occupational pension through their workplace pension schemes. This was the guaranteed minimum pension. It was broadly equivalent to the additional state pension foregone, and it set a level below which the occupational pension could not fall. In return, both the scheme members and the sponsoring employer of the scheme paid lower national insurance contributions. Most schemes provided pensions above this set minimum, with many providing pensions that were significantly higher. The pensions provided above the GMP have their own rules; however, the GMP provides a useful minimum benefit for members. I think that covers the relevant background to the order, which may be familiar to the Committee, and I hope this gives a sense of what was happening at the time and why the order is still important.

Moving on to the order itself, the GMPs increase order relates specifically to members who were contracted out of the additional state pension between April 1988 and April 1997. The order provides these members with a measure of inflation protection for the GMP element of an occupational pension scheme built up between 1988 and 1997.

As your Lordships may be aware, legislation states that when there has been an increase in the annual level of prices, as measured at the previous September, the order must raise the GMP element of an individual’s occupational pension that was earned between 1988 and 1997 by this percentage increase or 3%, whichever is lower. As September 2023’s consumer prices index figure was 6.7%, this means that the increase for the financial year 2024-25 will be 3%. The cap of 3% for GMPs earned between those years aims to achieve a balance between providing some measure of protection against inflation, while not increasing schemes’ costs beyond what they can generally afford.

The cap provides schemes with more certainty, allowing them better to forecast their future liabilities, which is important when they are considering their funding requirements. If there were no limit on the increases, the higher costs could put unreasonable pressure on schemes, which could put their future viability at risk. The cumulative effect of high increases every year could be significant.

A point that has been raised previously, including in the debate last year, is the suggestion that requiring schemes to index post-1988 GMPs was introduced only to save the taxpayer money, as the indexation on earlier accruals was achieved through an uplift in the state pension. A central reason behind why the Government made this decision is that contracting out has always been about the state and the private sector working together, and that having a set amount of indexation paid for by the scheme, with additional protection provided by the state, is a sensible balance.

Let me explain how that system works. When inflation is above 3%, as it currently is, most people with GMPs earned between those years—1988 and 1997—who reached state pension age before 2016 will receive the same inflation protection as if they had not been contracted out. This means that most people who reached state pension age before April 2016 will receive a top-up of 3.7% this year through the additional state pension. In other words, they will receive 3% from their occupational pension scheme and the remainder as a top-up through the additional state pension.

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[Viscount Younger of Leckie (Con)]

My Lords, I begin by thanking the three Peers who have spoken in this debate which was even than the previous one. I say at the outset that I appreciate the general support for these regulations. Regarding the GMP increase order, it is always helpful to be aware from the outset that your Lordships are generally supportive of what it sets out to do. Occupational pensions schemes help provide members of their scheme who have a GMP accrued between 1988 and 1997 with, as I said earlier, a measure of protection against inflation eroding the value of their pension.

At the outset, I will also give a very brief response to what was not really a question from the noble Baroness, Lady Janke, about the triple lock. We are pleased to confirm that the triple lock remains in place. I do not think that there was a question there, but I acknowledge that point.

There were a number of questions. I shall start off by answering in no particular order some questions raised by the noble Lord, Lord Davies of Brixton. As to the very specific question of how many people who contracted out will be worse off because of the loss of GMP indexation through the state scheme—he particularly mentioned 2016-17—people who reach state pension age after April 2016 will be entitled to the new state pension and will receive up to 3% from the scheme on their 1988-1997 GMP, which he will know. When looking at the reforms in the round, people may not lose out in aggregate terms because, in effect, indexation has ended for people reaching state pension age from 6 April 2016. This is because the transitional rules of the new state pension can be particularly advantageous for people who have been contracted out.

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[Baroness Sherlock (Lab)]

I just want to understand that response. It does not sound like very many. I presume what the Minister is trying to say to the Committee is that, having looked at the denominator of how many people might expect to be eligible and how much they might get, that number does not feel disproportionate. Is that what he is saying?

[Viscount Younger of Leckie (Con)]

Yes—that is absolutely right. Let me see whether there is any further information that I can get to the noble Baroness on this niche matter. If I am wrong, I will write, but I will certainly write anyway. I am coming towards the end of my remarks; I have only a couple more questions to answer.

The noble Baroness, Lady Sherlock, asked where she might find the latest state pension statistics. As she may know, they are available on Stat-Xplore, but only up to May 2023. The release of updated statistics due to be published on Tuesday 13 February 2024 was suspended, as the noble Baroness alluded to in her remarks. This delay results from issues with the internal processing of state pension data after it was sent for analysis from the “Get your State Pension” system and has an impact only on statistics that are not yet published. State pension statistics previously published on Stat-Xplore in November 2023 remain reliable. Work is under way to remediate these issues, and we will publish the suspended state pension statistics as soon as we are able.

The noble Baroness also asked about the status of the auto-enrolment extension Act’s powers and the consultation. The Government remain committed to expanding the benefits of AE to younger people and helping all workers to save more for their retirement. This is why we supported the Pensions (Extension of Automatic Enrolment) Act 2023, to which the noble Baroness alluded. To cut to the quick, we intend to conduct a consultation on the detailed implementation of these measures at the right time and in the right way. That is probably not in line with what my colleague in the other place said—“in due course”—but our commitment stands to implement in the mid-2020s.

With those remarks, I will, as ever, check in Hansard that I have attempted to answer all the questions asked. The Committee should be reassured that, if I have not done so, I will write. In the meantime, I thank all three Peers for their interest.

Motion agreed.

Poverty Reduction

Viscount Younger of Leckie Excerpts

Thursday 22nd February 2024 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, I am very pleased to close this important debate. It has allowed us to discuss many issues and challenges relating to poverty, with a focus on cross-government efforts to find a solution.

I will start by thanking all noble Lords for their valuable contributions today—particularly the noble Lord, Lord Bird, who has tirelessly championed vulnerable and homeless people over many years, for initiating this debate. I will say a little more because noble Lords should be in no doubt that I was very moved by his impassioned speech. He spoke about giving the poor more, mentioning it many times, and how this was not necessarily the way forward. He also spoke with great conviction about PECC—prevention, emergency, coping and cure. I listened carefully to his remarks. I am afraid that I may use the word “initiative” in some of my remarks, and I await the spears that will be thrown at me without, I have to say, any particular shield.

I also pay tribute to the noble Baroness, Lady Taylor, for her long service in local government. It is appropriate to acknowledge the time she spent in local government. She now gives us the benefit of her knowledge and skills in this House, and we are all the better for that.

I have listened with great interest to many ideas promulgated today, particularly about a co-ordinated approach to tackling poverty. I would like to reassure noble Lords, in particular the noble Baroness, Lady Lister, that we indeed have a co-ordinated approach. I will set out our stall in terms of what the Government have been doing. The noble Baroness, Lady Burt, is right; we need to work together. That is extremely important.

I also acknowledge the outstanding maiden speech from the right reverend Prelate the Bishop of Hereford. I am glad, as has been said by others, that he has survived so far, given the past experiences—some rather gruesome—of his predecessors. It is especially helpful and important to have a representative from his Benches for rural issues, which is not to say that there are not other right reverend Prelates who cover rural issues. He has clearly made it his business to become steeped in many local issues in Hereford, and that bodes well, because I can tell that his style is to focus on detail, with cogent argument. The House is all the better for his presence here, and I await his further contributions—with some trepidation, if I happen to be at the Dispatch Box.

I fully recognise that poverty is a hugely complex subject and that many people who experience it often face a range of barriers that can make it difficult for them to move on with their lives. As the noble Lord, Lord Bird, acknowledged, it is incredibly difficult. I also recognise that tackling these complex underlying challenges cannot be done in isolation. This Government have a range of programmes that work across departmental boundaries to help people to address the challenges they face, so that they can take their first steps towards employment and better outcomes for themselves and their families.

The noble Baroness, Lady Lister, is right that it is also about dignity and promoting and upholding the dignity of those who are suffering in poverty and destitution, without patronisation, if I can put it in that way.

I want at this point to acknowledge the valedictory speech of my friend, the right reverend Prelate the Bishop of Durham. We all wish him well for his retirement, and I personally thank him for his commitment and for raising many important issues during his time in the House. I have to say that I have appreciated his frankness in speaking truth to power—as the noble Baroness, Lady Armstrong, said, not about him but in other respects—and for his friendship. As many Peers have mentioned, the right reverend Prelate has consistently raised important matters relating to poverty, and this debate is certainly no different. I will be addressing many of the points he has raised, including raising the national living wage, reappraising of the value of unpaid work, the two-child limit, which is an old favourite that I shall be covering, the essentials guarantee, too much silo thinking and the need for a shift in national thinking, which was a big comment that he made. We will miss him and, if I may say so, he leaves certain important matters, including questions, ringing in my ears, and I will not forget that.

I shall set out some specific examples in a moment, but I want to start by reminding noble Lords of the significant support provided by my department to those on the lowest incomes. Before I get into detail on that, coming back to some questions that have been raised by the noble Baroness, Lady Lister, in terms of a poverty strategy, while there is no written strategy, we have been clear in our approach, which I will outline throughout my speech, and I hope that she will acknowledge this, focusing on both our welfare offer and our efforts to get people into sustainable employment and progress. There is more than that. She will expect these lines to be “trotted out”, as she put it, but I hope she does not think that way too much.

The noble Baroness asked an important question about poverty measurement. She might like to know that my department is developing so-called below average resources—BAR—statistics to provide a new, additional measure of poverty based on the approach proposed by the Social Metrics Commission, led by my noble friend Lady Stroud. The new BAR approach seeks to provide a more expansive view of available resources, both savings and inescapable costs, than the income measurement adopted under the DWP’s households below average income statistics. In developing this additional poverty measure, the DWP is working closely with stakeholders, including the SMC, other government departments and subject matter experts on this important point.

A strong welfare system is at the heart of ensuring support for those who need it, and our commitment to maintaining a strong safety net is reflected in the £276 billion that we expect to spend through the welfare system in Great Britain this financial year. Having uprated in line with inflation this financial year, we have announced a further increase of 6.7% in working age benefits for 2024-25, subject to parliamentary approval. The basic and new state pensions will be uprated by 8.5%, in line with earnings, as part of the ongoing triple lock.

We are also providing cost of living support worth £104 billion over the period 2022-23 to 2024-25. This is a cross-cutting package of support built on what we learned during the Covid-19 pandemic about supporting those most in need during challenging times. In particular, my department has worked closely with HMRC, HM Treasury and the devolved Administrations to deliver cost of living payments of up to £900 to more than 8 million households across the UK on eligible, means-tested benefits this financial year. I am pleased to say that DWP and HMRC delivered the third means-tested cost of living payment of £299 to most eligible households between 6 February and 22 February 2024.

We have not been delivering this support alone. My department has worked closely with local government—to be helpful to the noble Baroness, Lady Taylor, and perhaps also to the noble Baroness, Lady Lane-Fox—to deliver the household support fund. One hundred and fifty-three local authorities across England have used this funding to provide a variety of support to households to help with their essential costs. I am aware that there remains considerable interest across both Houses in the future of this fund. As with any issue, the Government continue to keep these matters under review in the usual way. As the House knows only too well, the current scheme continues to run until the end of March.

From April, we are increasing the national living wage for people aged 21 and over by 9.8% to £11.44, representing an increase of more than £1,800 to the gross annual earnings of a full-time worker on the national living wage. The right reverend Prelate the Bishop of Durham asked about low pay, particularly with regard to insecure work. I have already mentioned the national living wage, but this record cash increase of £1.20 per hour means we will hit the target for the national living wage to equal two-thirds of median earnings for those aged 21 and over in 2024. This will bring an end to the low hourly rate for this particular cohort. The new in-work progression offer is now live across all jobcentres in Great Britain and we estimate that 1.2 million low-paid claimants are eligible for work coach support to help them to increase their earnings. Progression leads are working with key partners, including local government employers and skills providers, to identify and develop local progression opportunities.

The right reverend Prelate the Bishop of Hereford raised the importance of housing. As he will know, the Government are supporting people in paying their rent and will invest £1.2 billion on increasing the local housing allowance rate to the 30th percentile of local market rents. That will ensure that 1.6 million private renters in receipt of housing benefit or universal credit gain on average around £800 per year in additional help towards their rental costs in 2024-25. I believe that is a significant investment, worth about £7 billion over five years.

I said earlier that we do not work in isolation, and many of the complex issues faced by vulnerable people cannot be tackled through the welfare system alone. My department continues to work in partnership with other parts of central and local government to deliver the support that people need. Alongside the Department for Levelling Up, Housing and Communities, we are committed to working with local authorities to tackle homelessness and end rough sleeping for good—which we must do, to reassure the noble Lord, Lord Bird, who is so steeped in this subject. I am proud of the progress that has been made in recent years and the continued work to meet all the commitments outlined in the cross-government rough sleeping strategy but, as I will be told by the noble Lord, there is much more to do, and I can see it myself when walking through the streets.

I turn to the important theme that was raised today of families and children. The Department for Work and Pensions, the Department for Levelling Up, Housing and Communities and the Department for Education are working together to deliver the Supporting Families programme. Between April 2015 and December 2023, the programme funded local authorities to help more than 612,000 families make sustained improvements in relation to the often complex problems that led to them joining the programme in the first place. A network of 300 specialised work coaches, the Supporting Families employment advisers, support the programme by providing employment support for families that are experiencing multiple disadvantages.

The departments also work together to deliver a range of support to help ensure that children thrive, which is another key theme that has come up today. The pupil premium will ensure that targeted funding continues to help schools to support disadvantaged five to 16 year-old pupils and to close attainment caps.

The noble Baroness, Lady Lister, raised the importance of child poverty in an important part of her speech. I hope I can reassure her that we are taking this seriously and working across government on a range of matters to reduce child poverty. She shakes her head, so I clearly have more work to do.

The right reverend Prelate the Bishop of Durham also raised the importance of child poverty and talked about the two-child policy. He asked again why the Government do not do the right thing and abolish it. We believe that families on benefits should face the same financial choices when deciding to grow their family as those supporting themselves solely through work. He will know only too well, and he has heard these lines from me before, that on 9 July the Supreme Court handed down the judicial review judgment on the two-child policy. The court found the policy lawful and not in breach of the European Convention on Human Rights. However, no doubt we will continue to debate this matter.

In addition, there is collaboration between the Department of Health and Social Care and the Department for Education to provide support to families through Healthy Start, the nursery milk scheme and the school fruit and vegetables scheme, which together help more than 3 million children. To reassure the noble Baroness, Lady D’Souza, the Government have extended the free school meals eligibility several times, as she will probably know, and to more groups of children than any other Government over the past half a century.

The issue of child poverty was raised also by the noble Baroness, Lady Armstrong, and the right reverend Prelate the Bishop of Durham, focusing on poverty in the north-east and with particular reference to the North East Child Poverty Commission, and I listened carefully to what she said. There are some figures that I could bring out, but the most recent data shows that the proportion of children in the north-east in absolute poverty after housing costs fell by seven percentage points in the three years to 2021-22, compared with the three years up to 2009-10. Having said all that, we understand that many families are still struggling—I am the first to say that—and this is work in progress. That is why some help has been given through the comprehensive cost of living support.

The noble Baronesses, Lady Burt and Lady Armstrong, addressed the pupil premium. I emphasise, in response to the comments from the noble Baroness, Lady Burt, that the funding is on top of the £1 billion of recovery premium funding provided in the 2022-23 and 2023-24 academic years, following over £300 million delivered in 2021-22.

On our approach to poverty, while it is absolutely right that we maintain a strong welfare safety net for those in need—I emphasise that—particularly during challenging economic times, we have always believed that, for those who can, the best way to help people to improve their financial circumstances is through work. I know that the noble Lord, Lord Bird, and I alluded to this earlier, mentioned prevention and cure. That is an answer, but not the only answer. We believe that prevention and cure are possible through getting people into work and I hope he will agree with that, although, as I say, it may not provide all the answers.

Our approach is based on the clear evidence around the important role that work, especially full-time work, can play in lifting people out of poverty. This is why, with over 900,000 vacancies across the UK, our focus is firmly on helping people take their first steps into work and to progress towards financial independence. We want everyone who can to be able to find a job and to progress and thrive in work, whoever they are and wherever they live. To ensure that support meets the needs of people across the country, my department offers a national programme of welfare and employment support, delivered through the Jobcentre Plus network across Great Britain.

My department also has local teams that specialise in working in partnership with local government and other local stakeholders, including businesses and communities—to be helpful to the noble Baroness, Lady Lane-Fox—to understand each area’s needs. This place-based approach is crucial in helping to address the disparities that exist between regions and underlines our commitment to spreading opportunity and unleashing potential across the UK.

Of course, we recognise the points raised by the noble Baroness, Lady Finlay, on the link between health and work. That includes mental health conditions, which she particularly focused on. The joint DWP/DHSC Work and Health Unit was set up in 2015 in recognition of the significant link between work and health and to reflect the shared agenda of boosting employment opportunities for disabled people and people with health conditions.

I want to cover some of the questions raised; I hope I can cover them in the remaining time. Notably, these questions were from the noble Lords, Lord Bird and Lord Loomba, and the noble Baroness, Lady Lister. This goes back to strategy. I think the noble Lord, Lord Bird, was probably asking the Government for a ministry of poverty, not a Ministry of Justice. I may be wrong in interpreting what he was trying to say. I hope I have shown in my speech that we saw during the pandemic the Department for Work and Pensions consistently working well across government to support the most vulnerable households.

There is a lot of work going on across government and I believe that there is joined-up thinking. In addition to Ministers meeting counterparts in other departments, officials work regularly with colleagues across government to better understand the multidimensional nature of poverty and to craft effective policy. This includes a cross-government senior officials’ group on poverty, as well as bilateral meetings and meetings with external anti-poverty stakeholders.

The noble Baroness, Lady D’Souza, asked about the five-week wait. It is not possible to award a universal credit payment as soon as a claim is made, as the assessment period must run its course before the award of UC can be calculated. This process ensures that claimants are paid their correct entitlement, based on verified information and actual earnings, and prevents significant overpayments from occurring.

The noble Baroness, Lady Lane-Fox, made an important point about digital exclusion particularly affecting lower-income households. I reassure her that we are aware of this. She is right and she is a great champion in this area. The costs of being connected online can be a barrier for low-income households. The DWP has worked with DCMS and Ofcom to influence broadband providers to support extending eligibility for new broadband social tariffs to low-income households. As a result, some broadband providers have made their new social tariffs available to all UC claimants and claimants of other means-tested benefits. The DWP has worked with Ofcom to promote awareness of these social tariffs to DWP stakeholders and work coaches throughout our Jobcentre Plus network, who can then signpost claimants to apply for broadband social tariffs.

The noble Baroness also raised the issue of chambers of commerce, and I listened carefully to what she said. I think my speech set out, as I said earlier, some emphasis on the close cross-government working with local authorities. I agree that it is vital that local authorities also work collectively to build local leadership, and I will certainly take her remarks back.

The noble Lord, Lord Loomba, and the noble Baroness, Lady Lister, spoke about funding for local government. I reassure them that the Government have announced additional measures for local authorities in England, worth £600 million—the noble Baroness will know that.

The right reverend Prelate the Bishop of Hereford and the noble Baroness, Lady Finlay, spoke about mental health. I alluded to that earlier, but we recognise the challenges of those in poverty, which is why we are investing an additional £2.3 billion a year in mental health services.

I should draw my remarks to a close. There are a couple of questions, particularly from the noble Lord, Lord Desai, who made interesting points about a universal basic income. I will write to the noble Lord on his interesting idea, which is not new to me. I will expand upon it and perhaps give him a full answer.

I reassure the House that Ministers continue to work across and beyond departmental boundaries to ensure that we take a co-ordinated approach to supporting vulnerable and low-income households. We look forward to working with all noble Lords across the House to continue to support those in need. This is a very important subject, and I again thank the noble Lord, Lord Bird, for once again raising it. It certainly is important for the Government.

Pneumoconiosis etc. (Workers’ Compensation) (Specified Diseases and Prescribed Occupations) (Amendment) Regulations 2024

Viscount Younger of Leckie Excerpts

Monday 19th February 2024 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Pneumoconiosis etc. (Workers’ Compensation) (Specified Diseases and Prescribed Occupations) (Amendment) Regulations 2024.

Motion agreed.

Occupational Pension Schemes (Collective Money Purchase Schemes) (Amendment) Regulations 2023

Viscount Younger of Leckie Excerpts

Monday 19th February 2024 Lords Chamber

Moved by

[Viscount Younger of Leckie]

That the draft Regulations laid before the House on 14 December 2023 be approved. Considered in Grand Committee on 13 February.

Motion agreed.

Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2024

Viscount Younger of Leckie Excerpts

Monday 19th February 2024 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2024.

Motion agreed.

Mesothelioma Lump Sum Payments (Conditions and Amounts) (Amendment) Regulations 2024

Viscount Younger of Leckie Excerpts

Monday 19th February 2024 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Mesothelioma Lump Sum Payments (Conditions and Amounts) (Amendment) Regulations 2024.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, I will also speak to the draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2024 and the draft Pneumoconiosis etc. (Workers’ Compensation) (Specified Diseases and Prescribed Occupations) (Amendment) Regulations 2024.

The schemes we are debating today provide vital support for sufferers of dust-related diseases often caused by occupational exposure to asbestos and other harmful dusts. This includes diseases such as pneumoconiosis and mesothelioma. Although both schemes aim to provide compensation to sufferers within their lifetime, each scheme also allows for claims by dependants if, sadly, the person suffering from the disease passes away before they are able to claim. This is in recognition of the suffering these diseases can bring to whole families.

The changes we are debating today will apply equally to those in England, Wales and Scotland. The Government recognise that addressing Great Britain’s asbestos legacy, particularly in public buildings, remains a key issue. We also understand the crucial role that research and early detection can play in the fight against cancer and other diseases covered by these schemes. We continue to make progress in this space, with the rollout of the NHS targeted lung cancer screening programme, and around £122 million invested in cancer research in 2022-23 through the National Institute for Health and Care Research. However, while individuals continue to be diagnosed with these terrible diseases, the lump sum schemes remain a vital source of financial support for sufferers and their families.

I will now take a moment to provide some additional background to the schemes. The Pneumoconiosis etc. (Workers’ Compensation) Act 1979, which—noble Lords will be relieved to hear—for simplicity I shall refer to as the 1979 Act scheme, provides a single lump sum compensation payment to eligible individuals who suffer from one of the diseases covered by the scheme. This includes diffuse mesothelioma, pneumoconiosis and three other dust-related respiratory diseases. It was designed to compensate people who were unable to claim damages from former employers that had gone out of business and who had not brought any civil action against another party for damages. To be entitled to a lump sum award, claimants must have an industrial injuries disablement benefit award for a disease covered by the 1979 Act scheme.

The 2008 mesothelioma lump sum payments scheme, which I will refer to as the 2008 Act scheme, was introduced to provide compensation to people who contracted diffuse mesothelioma but were unable to claim compensation through the 1979 Act scheme. This may have been because they were a self-employed worker or their exposure to asbestos was not due to their work. The 2008 Act scheme provides support quickly to people with diffuse mesothelioma, at their time of greatest need.

This Government recognise the suffering that diseases such as mesothelioma and pneumoconiosis cause to sufferers and their families. I know that many noble Lords will be aware of friends and close colleagues from your Lordships’ House who have lost their lives as a result of these dreadful diseases. I have known two people who have succumbed. We must remember the great impact these illnesses have on people and their families.

Each year, the schemes continue to provide vital financial support to sufferers and their families. Between April 2022 and March 2023, the latest financial year for which data is available, 2,860 awards were made across both schemes, with expenditure totalling £42.3 million. However, between now and 2028-29, expenditure on the schemes is forecast to fall by 8% in real terms. In part, this may reflect historical changes in the domestic workforce but also improved health and safety provision more widely. This may provide some hope that fewer families will suffer the impacts of these terrible diseases going forward.

Two of the instruments we are debating today seek to increase the value of one-off, lump-sum payments made under the 2008 Act scheme and 1979 Act scheme respectively, this time by 6.7%. These new rates will apply to those who first become entitled to a payment from 1 April 2024. As many noble Lords will be aware, these two schemes are not included in the main social security benefits uprating procedure. However, a 6.7% increase is in line with the September 2023 consumer prices index and mirrors the proposed increases to industrial injuries disablement benefit payments and other disability benefits. As I outlined this time last year, there is no statutory requirement to review the level of these payments annually. However, the department has decided to uprate payments under both lump-sum schemes together, in line with inflation, since 2010. I reassure noble Lords that this year will be no different, which reflects the continued importance of the support provided by these schemes.

This year, in addition to the uprating instruments, I ask that the Committee considers a third draft instrument. Unlike uprating, this instrument will not form part of an annual process. Instead, it seeks to extend the eligibility criteria under the 1979 Act scheme. This instrument will simply realign the diseases which may bring entitlement to a payment under that scheme with those that may bring entitlement to IIDB, ensuring that the original policy intent of the 1979 Act is reflected in the legislation. In doing so, it will widen the 1979 Act scheme entitlement to customers suffering from two additional dust-related conditions; first, unilateral or one-sided diffuse pleural thickening and, secondly, asbestos-related primary carcinoma of the lung where there is no accompanying asbestosis.

As many noble Lords are aware, the department is advised by the Industrial Injuries Advisory Council—an independent scientific body, called IIAC—on changes to the list of prescribed diseases for which IIDB can be paid. At the point that they were added to the 1979 Act legislation, the specified diseases exactly mirrored diseases listed in the relevant IIDB legislation. Over time, IIAC has recommended several changes to IIDB prescribed diseases that are also specified in the 1979 Act, which have been accepted by the department.

The unintended impact of accepting these recommendations was that people who suffer from one-sided diffuse pleural thickening and primary carcinoma of the lung with occupational exposure to asbestos, but no accompanying asbestosis, are now potentially eligible for IIDB but not eligible for an award under the 1979 Act scheme. This divergence was first identified in September 2023, when officials were asked to provide clarification on entitlement for an individual case. Officials have worked at pace since September to bring forward the legislation that we are debating today.

The proposed amendments seek to address this divergence by realigning diseases specified in the 1979 Act legislation with those which may bring entitlement to IIDB. If approved, this instrument will mean that the diseases specified in the 1979 Act legislation are based on an improved clinical understanding and that the original policy intent of the 1979 Act is reflected fully in legislation.

Historically, payments have been made to sufferers of these two diseases, despite the divergence identified in the legislation. This was because the department was using diseases set out in the IIDB legislation when considering entitlement to a lump-sum award under the 1979 Act scheme. Importantly, our understanding is, therefore, that customers who made claims for these two diseases historically have not missed out as a result of the change not being made sooner.

As of 16 February, the department was holding 94 claims made since September 2023 where it has not been possible to establish entitlement under the current legislation, but where the criteria would be met under the proposed legislation. If it is approved today, we will pay these customers as soon as possible.

Overall, we estimate that this change will extend legislative entitlement to a 1979 Act scheme lump-sum award to approximately 300 people a year with one-sided diffuse pleural thickening and asbestos-related primary carcinoma of the lung—a reflection of the vital role the schemes play in providing compensation to those affected by these terrible diseases. I am sure—I hope—that noble Lords here today will join me in recognising the continued importance of the compensation provided by these schemes.

Finally, as a part of my role, I am required to confirm that each of these three provisions is compatible with the European Convention on Human Rights, and I can gladly do so. I commend the proposed amendments to these schemes to the Grand Committee and ask noble Lords’ approval to implement them. I beg to move.

[Baroness Blower (Lab)]

My Lords, as general secretary of the National Union of Teachers, I was aware of a number of members who died from school-acquired mesothelioma. I declare an interest: having worked in an asbestos-contaminated school myself, I have that registered on my medical record, although I am in good health at the moment.

These lump-sum payments are meant to provide some compensation for asbestos victims who cannot get civil compensation from a former employer, but there is an inconsistency in the schemes. If a surviving partner or dependant must claim after their loved one has died, they receive a substantially lower payment. In 2019-20, a 77 year-old with mesothelioma would have received £14,334 if they claimed themselves, but if they died before claiming, which can of course happen with a cancer that is both aggressive and difficult to diagnose, their surviving partner or dependent child would have received £7,949. Mesothelioma patients typically have months left to live at the time of their diagnosis.

Many surviving partners, often women on modest wages or pensions, suffer financial hardship after the loss of their loved one. Their household income falls, but many of their outgoings remain the same. In that situation, they are further disadvantaged if they can receive only the much lower posthumous payment, so there is a clear moral case for raising that payment. Of the 3,830 payments made in 2018, only 260 were posthumous claims, according to the figures I have from the TUC. It estimates that it would cost £1.5 million to equalise payments. In its view, and indeed mine, raising the level of posthumous payments is therefore affordable.

In 2010, the Government acknowledged that there was no justification for the differential payments, stating that the inequality in payments could put pressure on victims’ families when they are most vulnerable. Does the Minister agree that it is now time to change this and equalise the payments?

--- Later in debate ---

[Viscount Younger of Leckie (Con)]

My Lords, I start by thanking all noble Lords here today for their contributions to this short debate. As has been the case in previous years, it has demonstrated the profound interest in these schemes that is present in the House—indeed, in this Committee.

I should start off by saying this: it is important that we all remain mindful that these debates are about those whose lives have been impacted by these dreadful diseases. I particularly appreciate the attendance of the noble Baronesses, Lady Donaghy and Lady Finlay, who have broken off from their committee; again, it emphasises the importance of this subject.

The Government recognise that the two schemes we are debating today form a crucial part of the support that is available to people suffering from dust-related conditions and their families. It is right that we ensure that the value of these compensation schemes is retained, especially in these difficult times. In addition to ensuring that these awards are uprated for those who first become entitled from 1 April 2024, the Government are also proposing to make changes to the list of diseases that may bring entitlement to compensation under the 1979 Act scheme.

A number of questions were asked. I will attempt to answer them all; I hope that there will not be any duplication in what I say. I shall mark my own homework on that; I am sure that noble Lords will do so too.

First, the noble Baronesses, Lady Blower, Lady Donaghy and Lady Sherlock, referred to equalisation and dependant awards, asking: why do dependants get lower awards than sufferers and when will the Government equalise these award rates? It is clear that whole families can be devastated by these diseases, as I said earlier; that is why dependants can claim compensation following the passing of their loved ones. The Government remain of the view that available funding should be prioritised to those people who are currently living with the disease. This position is in line with the main purpose of these schemes: to provide financial support to people living with certain diseases, and to help them deal with the issues that illness brings. I hope that I have a figure for the noble Baroness, Lady Sherlock; I will address that in a moment.

The noble Baronesses, Lady Sherlock and Lady Blower, asked further questions about disparity, including on the number of recipients of payments under the 1979 scheme who were aged 77 or over and the number aged 37 years and under. They also asked for the breakdown of payments by industry. I can tell the Committee that, in the last full financial year for which published data is available—April 2022 to March 2023—2,460 awards were paid under the 1979 scheme. Some 1,400 of the awards paid—57% of them—were for individuals aged 77 and over, while fewer than five awards paid were for individuals aged 37 and under. Unfortunately, information on the occupational and industry breakdown of recipients of the lump sum schemes is not published and is not readily available; this would require analysis of multiple datasets for the 1979 scheme and the industrial injuries disablement benefit in order to determine occupational and industrial formation. I have probably gone a bit further than the question that was asked but I hope that that is helpful.

The noble Baronesses, Lady Blower and Lady Finlay, asked further questions about equalisation. Around 90% of the payments made under both schemes are paid to sufferers of the diseases covered by the schemes. As I have said already, we are prioritising those living with the diseases.

We estimate that to equalise awards for people diagnosed with the disease and dependants in 2024-25 would require an additional £1.4 million a year from the DEL budget. No provision has been made for this in the current spending review settlement. I think the figure that the noble Baroness, Lady Sherlock, might like to have is the £1.25 million figure that has been raised today.

The noble Baronesses, Lady Finlay and Lady Blower, raised important questions about asbestos in schools and public buildings. I will attempt to address these questions. It is obviously incredibly serious, and the Department for Education expects all local authorities, governing bodies and academy trusts to have robust plans in place to manage asbestos in school buildings effectively in line with their legal duties. Well-maintained and safe school buildings are a priority for the Government, and we have allocated more than £15 billion of capital funding since 2015, including £1.8 billion this financial year. This comes on top of our 10-year school rebuilding programme, which will transform buildings at more than 500 schools. Where there are serious issues with buildings that cannot be managed by responsible bodies, the Department for Education provides additional support on a case-by-case basis.

Moving onto public buildings, the Government agree that continuing to build on the evidence base around the safe management and disposal of asbestos is fundamental in ensuring that the risks posed by its past use are minimised. The Health and Safety Executive has a mature and comprehensive regulatory framework to ensure that legacy asbestos risks in Great Britain are managed that aligns with the best evidence currently available. This is reflected throughout the approaches outlined in the Control of Asbestos Regulations 2012—CAR. Correct implementation of CAR not only ensures management of risks of exposure but will eventually lead to the elimination of asbestos from the built environment without the need for any target deadline.

The noble Baroness, Lady Finlay, raised supporting research into mesothelioma. Research is crucial, as I am sure the noble Baroness will tell me, in the fight against cancer. The Department of Health and Social Care invested around £122 million in cancer research in 2022-23 through the National Institute for Health and Care Research, which I think I mentioned in my opening remarks. For several years, DHSC has been working actively to stimulate an increase in the level of mesothelioma research activity from a rather low base. This includes a formal research priority-setting exercise, a National Cancer Research Institute workshop and a specific call for research proposals through the National Institute for Health and Care Research. I hope that chimes with the knowledge that the noble Baroness no doubt brings to this Committee.

In 2018, the British Lung Foundation launched the UK’s first Mesothelioma Research Network, the MRN, with the involvement of key stakeholders, including DHSC. The vision of MRN is to improve outcomes for people affected by mesothelioma by bringing researchers together and therefore driving research progress and improving the quality of research. The network is supported by a £5 million donation from the Victor Dahdaleh Foundation, which matches the funding given to Imperial College London by the Government to establish the National Centre for Mesothelioma Research. I could say more about this, but it might be better if I write more to the noble Baroness on this important matter. I suspect she knows a lot of it, but it is important, and I will copy in all Members of this Committee.

The noble Lord, Lord Allan of Hallam, asked which cases might lose out on the uprated rates if they are paid before April. Perhaps I can provide some form of reassurance. The uprating regulations apply only in relation to any case in which a person first fulfils the conditions of entitlement to a payment under the 1979 Act scheme on or after 1 April 2024. As the cases being held will have first become entitled to a payment under the 1979 Act scheme before 1 April 2024, the amount they will receive is unaffected by the uprating. I hope that clarifies that. I think I might have mentioned that in my opening remarks, but I just say it to re-clarify it.

The noble Lord, Lord Allan, and the noble Baroness, Lady Sherlock, asked about historic claimants paid ultra vires. I reassure both of them that their understanding of my understanding or perhaps my understanding of their understanding is correct, whichever way around that reads best.

The noble Lord, Lord Allan, asked whether anybody has missed out. I probably covered that okay in my previous responses, but perhaps to go a bit further the department understands that historic claims made for these two conditions will have already received lump sum payments. As a result, to reclarify, these claimants have not missed out on a payment because this change was not made sooner.

The noble Baroness, Lady Sherlock, asked whether in situations where a sufferer dies before a successful claim is paid the lump sum payment is paid to the estate of the deceased at the same rate. If someone with the disease makes a claim but dies before payment is made, the payment is made to their estate at the same rate that they would have received had they received their payment while they were alive.

The noble Lord, Lord Allan of Hallam, asked who will benefit from this change and whether this will benefit only new claims or historic claims. I think have covered that. The noble Lord may wish to rise if I have not.

[Lord Allan of Hallam (LD)]

I am grateful to the Minister. The question also relates to the previous answer that he gave. If somebody in the new category that we are talking about had applied in August last year, they would have received the payment; however, had they applied in October, they would be held in the queue. We want to understand that a person who has been held in the queue because they applied in October—at that point, the department understood that it did not have the legal authority—will not lose out in any way, particularly if, sadly, they have passed away between their application and now, the point at which we can release the funds because we have passed this statutory instrument. I do not want to delay this any longer; the faster we get it, the better.

[Viscount Younger of Leckie (Con)]

Absolutely. That was my understanding too. My understanding is that they would not lose out, given the case raised by the noble Lord. If that is not correct for any reason, I will certainly write to him; however, I have made it clear that nobody will lose, and I should stick to that point.

The noble Baroness, Lady Sherlock, asked about gender differences. Her question was interesting; she asked it last year but did not get an answer, I think. There is always a degree of uncertainty in predicting future disease incidence, but the annually published data from the HSE show that annual mesothelioma deaths were broadly similar in the period from 2012 to 2020 but lower in 2021. Before that, annual deaths had been rising steadily since the late 1960s, but current projections suggest that annual mesothelioma deaths in both males and females are expected to decline over the long term as a consequence of past reductions in asbestos exposure for both males and females.

How soon the decline in annual deaths will become evident is expected to be different, with deaths among males declining during the 2020s and deaths among females remaining broadly level during that period before starting to decline. The reason for this lies in different patterns of asbestos exposure in males and females in the past—the noble Baroness will appreciate that, I think—with heavy exposures being reduced or eliminated sooner in specific industries where fewer females worked, such as shipbuilding, insulation work and asbestos product manufacturing.

The noble Baroness, Lady Sherlock, asked about regional variations. Some asbestos exposures, such as during construction work, were widespread across all regions whereas other exposures, for example those I alluded to earlier associated with shipyards and asbestos product factories, were associated with particular regions. Of course, those regions still tend to have higher mortality rates today, sadly.

I should make a point of clarification to do with equalisation. We estimate that to equalise awards for people diagnosed with the disease and dependants in 2024-25 would require an additional £1 million to £4 million a year—I think I said £1.4 million and I apologise for that—from the DEL budget and no provision has been made for that in the current spending review settlement.

With that, I hope I have answered all the questions.

Motion agreed.

Occupational Pension Schemes (Collective Money Purchase Schemes) (Amendment) Regulations 2023

Viscount Younger of Leckie Excerpts

Tuesday 13th February 2024 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Occupational Pension Schemes (Collective Money Purchase Schemes) (Amendment) Regulations 2023.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, I am pleased to introduce this instrument. Subject to your Lordships’ approval, these regulations will make two small technical amendments to the landmark Occupational Pension Schemes (Collective Money Purchase Schemes) Regulations 2022 to ensure that they operate in accordance with our published policy. The instrument clarifies requirements on trustees of authorised collective money purchase schemes, more commonly known as collective defined contribution, or CDC, schemes.

I will first set out the context. The Pension Schemes Act 2021 provided the statutory framework for CDC schemes in the UK. The guiding principle of our approach has been to ensure that it protects the interests of members. The Government believe that CDC schemes have an integral role in the future of pensions in this country. CDC schemes offer members a seamless transition from saving to receiving a regular retirement income.

We know that many people do not want, or feel ill equipped, to make complex financial decisions at retirement. The Government want to ensure that as many savers as possible can take advantage of the numerous benefits of CDC. By pooling longevity and investment risk across the membership, CDC schemes can shield savers from much of the uncertainty faced by members of DC schemes. This also allows the scheme actively to target higher investment returns for their members than a DC scheme through increased investment in growth-seeking assets. This in turn can lead directly to greater investment in vital UK infrastructure and the technologies of the future, such as transport and renewable energy. That is why the Government have provided the legislative framework for single or connected employer CDC schemes to be set up in the UK. The CDC regulations came into force on 1 August 2022.

Throughout the development of our policy, the Government have been engaging with stakeholders on how best to deliver CDC schemes in the UK and inviting challenge and scrutiny. In that vein, we have been helpfully advised that two areas of the current framework do not meet our published policy intent. CDC schemes can succeed only if there is confidence in this new type of provision. That is why it is important that we provide immediate clarity. This instrument ensures that, from the start, prospective schemes are set up to work as we intend.

I will now take noble Lords into the detail of this instrument. With regards to the first amendment, the existing regulations make provision in relation to the annual actuarial valuation and benefit adjustment process for CDC schemes. This means that each year benefits are reviewed and adjusted where required so that the value of assets held is in balance with the projected costs of benefits. This protects members from the need to fund a surplus and means that reductions to benefits are not deferred and stored up. Doing so would have a detrimental impact on future years and younger members, which would be unfair. It is important that CDC schemes follow strict rules around benefit adjustment to ensure that all members, without bias or favour, are subject to the same adjustments.

It is important that a balance is maintained between the value of the available assets of the scheme and the amount needed to provide the target benefits to members on an ongoing basis. If, for example, the value of the assets is lower than the amount needed to pay the benefits, the scheme may be required to make a cut to benefits to regain that balance. Conversely, if the value of the assets is more than the amount needed to pay the benefits, the trustees will be required to pay an increase to the members.

The policy intention is to provide that, where a cut to benefits must be made, the trustees of the CDC scheme can smooth the impact of the cut on members over three years. This is called a multiannual reduction. Regulation 17 currently provides that, if a subsequent annual valuation that occurs during a multiannual reduction shows that an increase in benefits is required, the trustees, having taken advice from the scheme actuary, will be required to apply that increase in addition to the planned reduction for that year under the multiannual reduction that is in effect.

I appreciate that this is quite complex, so let me provide an example of how it is intended to work in practice. In a period of extreme economic downturn where equities fall significantly in value, it is possible that a CDC scheme would have to make a cut to members’ benefits. Regulation 17 enables the trustees of the scheme to mitigate the impact of this market volatility on member benefits by spreading the overall cut over three years. To use an easy example, if the overall cut necessary were 6%—my maths is not too good, but here we go—the members’ benefits could be cut by 2% a year over the three-year period.

This mechanism helps to reduce volatility and ensures that current and future benefits remain relatively stable. It contrasts with individual DC schemes, where there is no pension-smoothing mechanism. Members of these schemes would have experienced a significant reduction in the value of their retirement savings immediately, which for savers closer to retirement may be unrecoverable. The intention of Regulation 17 was that, where a market recovered during the period of such a reduction, increases in benefits resulting from subsequent annual valuation would offset, in whole or in part, planned cuts under a multiyear adjustment before being applied as an increase to future benefits in the normal way. This would have the benefit that any bounce-back immediately after a period of very poor performance could help to smooth outcomes and avoid cuts, which would then be unnecessary, while maintaining the principle that the costs of current and future benefits remain in balance with the value of scheme assets.

If we did not do this, the benefit of the recovery would instead be likely to go to future pensioners. This would run against our principle that, as far as possible, all members—current pensioners, those who are currently accruing benefits and those who are not contributing but have rights to a future pension from the scheme—should all share in upsides and downsides at the same time.

The instrument also makes a consequential change to Regulation 19. Any variation to a multiannual reduction as a result of offsetting an increase against must be reported to the Pensions Regulator, ensuring proper oversight.

I turn to the second of these amendments, which addresses an issue that may arise where a scheme winds up and the value of members’ accrued rights are transferred to suitable pension schemes or alternative payment arrangements. A key element of the wind-up process is calculating the share of the fund for each person who is a beneficiary at that time. The scheme rules may provide that the person may be a member or a successor of that member. Potential successors will be determined by the scheme rules, but could include a spouse, a child, a cohabitant or a person financially dependent on the deceased beneficiary. That share of the fund is applied to the scheme’s assets at the end of the winding-up to produce the beneficiary’s pot, which is then used to discharge the scheme’s obligations to the member by transfer to another scheme offering flexi-access income drawdown.

I ask noble Lords to imagine a scheme that has provided for these categories of people to be a beneficiary under its rules. If a member of that scheme dies during the winding-up process, their benefits are reallocated to the deceased’s stipulated beneficiary. They are not reallocated among the collective. The policy intention has always been that, if the beneficiary dies during the winding-up period, the pot allocated to them would not be extinguished but would instead be reallocated among their successors, where a scheme’s rules provide for that. This instrument therefore amends Schedule 6 to the regulations to ensure that the deceased member’s accrued rights in wind-up may be discharged in this way.

In conclusion, CDC schemes are an important addition to the UK pensions landscape and, when well designed and run, have the potential to provide a good retirement outcome for members. The effect of this instrument will be to provide clarity for schemes moving forward by more accurately reflecting the intent of the regulations that it is amending. I commend it to the Committee and beg to move.

[Lord Palmer of Childs Hill (LD)]

My Lords, I thank the noble Viscount for his clarification of the papers, which is very welcome—as usual. This is a statutory instrument with a more than usually snappy title, which will probably be more noted than some of the things in the instrument.

This statutory instrument is good news. It helps pave the way, as I understand it, for the introduction of the UK’s first collective defined contribution pension scheme, which I believe is by the Royal Mail. Collective defined contribution schemes in various forms are common in Scandinavia, the Netherlands and Canada. Work on these risk-pooling arrangements started during the coalition years when we, the Liberal Democrats, worked collaboratively with the Labour Front Bench and the Communication Workers Union to get the Royal Mail to implement the first scheme of this sort. I believe that it has not yet gone live, although perhaps the noble Viscount can tell me more about that.

The next developments of CDC, in my view, are, first, the extension of multi-employer or industry-wide CDC—when does the Minister expect to publish the next consultation on this?—and, secondly, the development of retirement-only or decumulation-only CDC schemes, so that a person could take his or her own pot and pool it with other people’s. Any comments on that would be gratefully received.

These regulations tidy up some issues that are causing practical problems. The main part is to do with what happens each year, as the noble Viscount said, when a scheme reviews whether it has enough money to meet its target pension payouts. As things stand, if the scheme is short, it can reduce planned pensions. But what happens if, a year later, it thinks that things are better? What these regulations appear to make clear is that the first thing you do is reduce or eliminate the planned pensions cuts. I think this was covered by the Minister’s comment about “a smoothing mechanism”.

One thing that comes out of this SI is that, as so often, there seems to be a lot more valuation work for actuaries. I am sure they will be very grateful. I am very grateful for the guidance in the papers and the elucidation from the Minister. I think the principles are right and we on these Benches agree with the instrument.

--- Later in debate ---

Can the Minister tell us what the delay is with the Royal Mail scheme? Secondly, given the need for that confidence, can he assure the Committee that the DWP remains confident in the ability of Royal Mail to deliver the required level and flow of contributions into its CDC scheme over the very long term? More broadly, what is the Government’s view about why CDC has not taken off more widely? Do they have plans to take steps to drive up the expansion of CDC schemes in future? I look forward to the Minister’s reply.

[Viscount Younger of Leckie (Con)]

My Lords, I thank all noble Lords for their helpful contributions to this short debate. Furthermore, I thank some noble Lords for the advance notice of their questions, particularly because this is quite a technical set of regulations, as I think we all understand. Given the incessant rain that we have been suffering over the past weeks, frankly, the drier the better—and that goes for this subject, too.

For an individual member of a CDC scheme, this instrument’s key effect will be to help to ensure that in a period of extreme economic downturn the principles of CDC continue to operate correctly. When, as expected, Royal Mail launches its CDC scheme later this year—I hope that this answers the questions from the noble Baroness, Lady Sherlock and the noble Lord, Lord Palmer—that member and their approximately 115,000 colleagues will be able to have more confidence that their new scheme will provide them with a regular income in retirement, with less exposure to the unexpected market shocks than might otherwise be the case. The noble Baroness, Lady Sherlock, raised a number of questions about the future of CDC schemes and Royal Mail, and I shall attempt to answer them in more detail later in my speech.

Noble Lords raised a number of questions about the multiannual reduction provisions, which I shall attempt to answer. First, the noble Baroness, Lady Sherlock, asked why the weakness in the current drafting was not identified before. It is important that all new legislation is monitored carefully to ensure that it works as we intended it to. It is through this monitoring process that we identified that the current drafting did not meet all of our published policy intention. If CDC schemes are to succeed, it is essential that prospective schemes are clear about those requirements. I hope that answers one of the questions from the noble Baroness.

The noble Baroness, Lady Sherlock, also asked whether approval from the Pensions Regulator was required or needed before any offsetting could be implemented. The decision to implement a multiannual reduction, including any offsetting, rests with the trustees of the scheme. It is based on the most recent actuarial valuation prepared by the scheme actuary and is subject to the scheme rules. Pre-approval is not required, but the Pensions Regulator will have ongoing scrutiny over such decisions in the normal way and the trustees are required to share the actuarial valuation with the regulator, again in the normal way.

The noble Baroness, Lady Sherlock, queried whether the trustees could be penalised if they failed to provide relevant information to the Pensions Regulator. As she may know, the standard civil penalties provided for in legislation, for example up to £5,000 in the case of an individual and up to £50,000 in any other case, can be imposed by the Pensions Regulator if the requirements are not met.

Both the noble Baroness, Lady Sherlock, and the noble Baroness, Lady Drake, asked whether offsetting following a bounce-back in investment performance could be applied retrospectively. Perhaps I can reassure them that it cannot be applied retrospectively because a key principle of this provision is that any bounce-back should smooth outcomes going forward and avoid the need for cuts, where possible, while ensuring that the costs of current and future benefits remain in balance with the value of the scheme’s assets. I think that chimes with some of my opening remarks, and I hope that it answers the question.

The noble Baroness, Lady Drake, asked whether an actuarial threshold was required before the full three years of a multiannual reduction could be deployed. I will answer that. There is no threshold, as it is for the trustees, who are independent and acting in the interests of the members, to decide whether to apply a multiannual reduction based on the information contained in the most recent annual valuation, which is prepared by the scheme actuary. A significant cut to benefits would likely be required only in extreme circumstances, but we would expect the trustees to utilise the multiannual reduction mechanism in this scenario, if it is provided for in the scheme rules. If they did not do this, they would need to explain their reasoning to the Pensions Regulator.

The noble Baronesses, Lady Sherlock and Lady Drake, and the noble Lord, Lord Palmer, all queried the policy intention of Regulation 3(5) and what implications it had for the front-ending or back-ending of the offsetting of the remaining planned reductions of the multiannual reduction. I would argue that this gets to the meat and granularity of the policy. The aim is to ensure that, while a degree of smoothing is allowed over a multiannual reduction, as we know, over three years, cuts are not stored up and deferred by backloading the cuts. That is why the legislation ensures that the reduction applied during each year of a multiannual reduction must not be greater than that applied in the previous year: that is very clear.

The noble Baroness, Lady Drake, asked how a transfer value would incorporate a scenario where the member transferred out before the multiannual reduction was completed or any potential offsetting was applied. Transfer values will be based on the conditions applicable at the time the member requested the transfer and when they actually transferred out of the scheme. Their transfer value will reflect any cuts planned for future years under a multiannual reduction. This means that nobody choosing to leave a CDC scheme will get more or less than the value of their benefits at that particular point.

I move on to the theme of wind-ups, which was raised by the noble Baronesses, Lady Drake and Lady Sherlock, who asked who qualifies as a successor and how you define one. I hope that I helped to answer that in my opening remarks, but perhaps I can go a bit further. Subject to scheme rules, this is an individual nominated by a dependant nominee or another successor to receive benefits following their death. Also, the scheme administrator can nominate a successor when, after that beneficiary’s death, there is no individual or charity nominated by that beneficiary.

I shall go a bit further on the question of transfers, which was raised by the noble Baroness, Lady Drake. The beneficiary has a number of discharge options they can choose from that are set out in the regulations. They include a flexi-access drawdown, which is where, subject to what the pension scheme rules allow, in any year the beneficiary can choose to take no payment of drawdown pension, a regular series of payments, an irregular payment stream or their whole flexi-access drawdown fund as a single payment. So there are a number of options there. Trustees must have completed the transfer process before the wind-up of the scheme can be completed. The value of the accrued rights to benefits transferred would be calculated based on the circumstances at the point of the transfer request.

The noble Baroness, Lady Drake, asked a number of questions about how the Royal Mail CDC scheme will operate. Royal Mail has informed us that it and its unions have agreed that the vast majority of existing employees with more than 12 months’ service will be enrolled into its collective plan at the so-called go live. It has also informed us that eligible new employees who join after go live will not be required to make an active decision unless they decide to opt out of contractual enrolment to the collective plan once they reach at least 12 months’ service with the employer. Which scheme Royal Mail chooses to use as a nursery scheme for its employees’ first 12 months of service is a decision for it and its union, as long as it meets the requirements of automatic enrolment.

The noble Baronesses, Lady Drake and Lady Sherlock, asked about the take-up of CDC in the UK. The Government are proud of the progress that we have made so far. During this Parliament, my officials worked closely with industry stakeholders to develop and bring into force legislation in 2021 to facilitate the introduction of single or connected employer CDC schemes. Over the past 12 months, the Government have announced a comprehensive package of pension reforms to provide better outcomes for savers and better support the UK economy. As part of that, we have been exploring the role that CDC can play in these reforms.

In answer to questions from the noble Lord, Lord Palmer, and the noble Baroness, Lady Drake, I am pleased to say that our consultation on CDC provision for unconnected multi-employer schemes and master trusts demonstrated significant appetite for it. A number of noble Lords mentioned timing; we intend to consult on regulations this spring.

The noble Lord, Lord Palmer, asked when we will extend the CDC provision to unconnected multi-employer schemes, including master trusts. We are committed to facilitating further CDC provision as quickly as possible, but we want to make sure that we get the legislation right to help ensure that the interests of members in these new schemes are generally protected. We engaged extensively with industry during the drafting process to ensure that this will be the case. As was mentioned earlier, we will consult on draft regulations to facilitate whole-life, multi-employer CDC schemes later this year. Subject to parliamentary approval, we intend for them to come into force in 2025.

The noble Lord asked what work is being done to legislate for decumulation-only CDC. The answer is the same: we are keen to facilitate access to CDC schemes where this would provide better outcomes for members, as long as we can ensure the necessary member protections. I come back to that important word, “protections”. Building on our work to develop a whole-life, multi-employer legislative framework, we are working closely with the pensions industry and regulators to explore what will be needed.

I thank all noble Lords for this fairly short but valuable and constructive debate. I also thank noble Lords for giving me their questions in advance. I see that the noble Baroness, Lady Drake, is itching to get up so I will give way.

[Baroness Drake (Lab)]

I did not want to get up too quickly. I do not want to hold up the closure of the debate on these regulations, but I was disconcerted by the Minister’s response on successors. Could he write to formally record what he said about that? For a trustee, a set of tax rules apply when the pension savings go into the estate and inheritance tax and a further set apply when the pension pot is handed over to a nominated beneficiary. Here we are talking about a second tier—a nominated successor to a nominated beneficiary. Trustees have to be very careful under which tax regime and to whom pension pots are being allocated. I struggled to follow what he said on that—because it is complicated, not because he did not explain it. I was thrown by the word “successor” when I read the regulations. It would be helpful if what he said could be written down, if we need to interrogate it further, rather than deal with it now.

[Viscount Younger of Leckie (Con)]

I quite accept what the noble Baroness has raised. She acknowledged that I gave out a lot of detail in defining what we think is right in terms of who would be a successor, cascading along the process if the successor had died and so on. However, if there is more to say—I hope that there might be—I shall write to the noble Baroness and copy in all noble Lords who have taken part in this debate. I thank her for her question.

Motion agreed.

Workers (Economic Affairs Committee Report)

Viscount Younger of Leckie Excerpts

Thursday 8th February 2024 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, I am very pleased to close this debate on the Lords Economic Affairs Committee report Where Have All the Workers Gone?. I thank all noble Lords for their valuable contributions, particularly my noble friend Lord Bridges of Headley for initiating the debate. I also thank his committee for the work undertaken in producing its report. This topic is one close to my heart, following my long career in human resources in industry and the City. I really do know how important it is that businesses are able to get the right people with the right skills in a competitive labour market.

Where have all the workers gone? I start by echoing the views of the noble Baroness, Lady Sherlock, also picked up by the noble Lords, Lord Sikka and Lord Hendy, and my noble friend Lord Balfe, about the importance and value of the workforce. The noble Lord, Lord Hendy, spoke—quite rightly, too—about the importance of the unions, and my noble friend Lord Balfe mentioned looking after the workers and their dignity, giving them compassion and respect from the employer’s point of view, and of course he is quite right.

My messages today are the following. Workers must feel that they want to go to work. They should feel that they are paid properly—indeed they should be paid properly—and that they have a stake in the business. That does not have to be a financial stake, but they should at least feel that their views are heard and their skills respected, nurtured and optimally utilised.

To pick up an important point about pay raised by the noble Lord, Lord Hendy, he will know that we expect the increases to the national living wage and the national minimum wage to give a pay rise to around 3 million workers. My noble friend Lord Griffiths and the noble Baroness, Lady Kramer, made some good points about the spirit of this debate. The working population, their health and the numbers in employment really matter, with all the knock-on effects on the economy, particularly of inactivity. Those are my opening points.

This is an appropriate moment to take a step back and reflect on just how much the labour market has changed over time. Just over 50 years ago, four in 10 women were economically inactive, largely due to caring responsibilities. Today, I am pleased to say that the figure is down to 25%, with more women choosing to enter and remain in the workplace to build a career. To address a question raised by my noble friend Lord Griffiths, expanding the opportunities for people to do work that they find fulfilling and rewarding is very much at the heart of what we are trying to do in government.

This report focuses on the rise in both vacancies and economic inactivity following the pandemic. However, the House will note, as pointed out by my noble friend Lord Bridges himself, that the publication goes back to December 2022. To reassure the noble Lord, Lord Bilimoria, I am keen to emphasise that the Government understand the scale of this challenge and have since announced an additional £6 billion of investment in additional support aimed at increasing workforce participation—I will expand on that.

The UK is also not alone in the challenges we face, as most countries for which we have data have higher vacancies than before the pandemic. This issue was raised by my noble friends Lord Bridges and Lord Griffiths, and the key question was: are the statistics fit for purpose? Getting the data on the labour market right is vital. My noble friends will know that the ONS is an independent organisation that decides for itself the best way to produce labour market statistics. However, we engage regularly with it and understand that it has taken a number of steps to improve the quality of the Labour Force Survey, and that survey data is being reintroduced from next week. We review and monitor a wide range of labour market statistics to inform our view, not just the LFS.

The noble Lords, Lord Skidelsky and Lord Bilimoria, expanded on this and stated that we are worse than other countries. That is not entirely true. The UK still has economic inactivity rates that are well below the average for the European Union and the OECD, as well as being the fourth lowest in the G7—but I acknowledge the higher levels of inactivity, which of course is the theme of this debate.

The report makes a number of recommendations, which centre on three main themes: the rise in economic inactivity due to long-term sickness and disability; those choosing to retire and leave the labour market early; and the impact that migration changes may have on certain sectors. I will address each of these in turn. They largely mirror the main points raised in the speech of my noble friend Lord Bridges; I appreciate the detailed analyses of the reasons behind the inactivity from the noble Lord, Lord Skidelsky.

First, on the important issue of long-term sickness and disability, which is now the most common reason stated for economic inactivity, the Government share the concern of noble Lords here today regarding increased economic inactivity levels for those who are disabled or long-term sick. I share the comments of my noble friend Lord Bridges on the statistic that one in five in the 16 to 64 group are inactive. The 2.8 million long-term sick figure is certainly one for great concern.

As the noble Lords, Lord Londesborough and Lord Layard, and the right reverend Prelate the Bishop of Bristol mentioned, we know that rewarding work is hugely beneficial for mental health and well-being, which is why this Government have an ambitious programme of initiatives to support disabled people and people with health conditions, including mental health conditions, into employment. They include increased work coach support and disability employment advisers in jobcentres; the Work and Health Programme and intensive personalised employment support; Access to Work grants—I reassure the noble Baroness, Lady Sherlock, that the backlog is reducing; I will follow up with her on that and give some figures proving that that is correct—the Disability Confident scheme; the information and advice service; and employment advice in NHS Talking Therapies, which was raised by the noble Lord, Lord Layard.

The noble Lord, Lord Layard, made a point about support for addiction. We are investing £39 million to expand our individual placement support programme for drug and alcohol dependency across England by 2025. This programme provides employment support alongside clinical treatment, making employment a key aim of recovery. The NHS is also expanding the mental health aim of this important programme and we are testing a peer mentoring programme in selected jobcentre areas; peer mentors use their lived experience of addiction and recovery to inspire, motivate and support others to manage their dependency, access appropriate support and move towards employment.

My noble friend Lord Griffiths asked about the knowingly economically inactive and their wish to work. He is right: the ONS figures indicate that more than 600,000 people who are inactive due to long-term sickness would very much like a job.

The right reverend Prelate the Bishop of Bristol spoke about disabled people. Let me say a few words about them. The Government are determined to do more to help close the disability employment gap and help more disabled and long-term sick people into work. That is why we have announced even more support targeted at this group over the past year. I will quickly reel some examples off: expanding the existing additional Work Coach support programme; introducing universal support, a new supported employment programme for disabled people; launching WorkWell, which will bring together the NHS, local authorities and other partners in collaboration with jobcentres; introducing employment advisers to musculoskeletal conditions services in England; and, importantly, consulting on occupational health provision in the workplace, as well as expanding the funding for the forthcoming small and medium-sized enterprise subsidy pilot for occupational health services. This week, we also published the Disability Action Plan, setting out 32 practical actions that the Government will take forward over the next 12 months to improve disabled people’s daily lives; noble Lords will be aware that I updated the House on this on Tuesday evening.

The noble Lord, Lord Londesborough, asked whether the Government have up-to-date statistics on those taken out of the workforce for each year between 2020 and 2023 because of sickness, as well as on how many were able to rejoin in each of those years. It was a precise question, and I hope I can give a precise answer. The ONS data suggests that, between those years, almost half a million more people were inactive due to long-term sickness. The most common conditions among this group were depression, anxiety and nervous dispositions, which also had the largest increase. Once people become economically inactive and the main reason for doing so is long-term sickness, relatively few of them move back into employment; that is rather sobering. Between 2019 and 2021, only around 3% of those who were long-term sick inactive moved into employment, so the noble Lord makes an important point.

I turn to the next issue raised in by the report. When we are talking about early retirement, I say to the noble Baroness, Lady Sherlock, “Yes, we take this matter extremely seriously”. I am pleased to note that data from the ONS shows that the number of those who state they are economically inactive due to early retirement has been decreasing. I think it was mentioned that the average age of Members of this House is 72; perhaps we are a good example, as we should be, of a cohort—a very distinguished one—working past retirement age.

Picking up on the remark by the noble Lord, Lord Skidelsky, I believe that our role in this Chamber at least is a decent job. To pick up another point, raised by the noble Lord, Lord Turnbull, perhaps we should be defined as being of working age. We can mull that over after this debate. However, we know that those over 50 seeking employment may face additional barriers, which is why the Government are committed to continuing to deliver a comprehensive package of support to help older workers remain in and return to work. I think that answers the second question from my noble friend Lord Bridges. This includes the additional work coach time for eligible jobseekers aged 50-plus on UC, dedicated 50-plus champions working out of every job centre across the UK, and the midlife MOT, which I am sure the House has heard of. It is a review for workers in their 40s, 50s and 60s that helps them take stock of their finances, skills and health.

The report also questions whether pensions freedoms in the UK are driving more people aged over 55 to become inactive. I took careful note of the remarks made on this subject by my noble friend Lord Willetts and the right reverend Prelate the Bishop of Bristol. Where individuals do access their pension using pension freedoms, this does not necessarily mean they have become economically inactive, and the evidence supports this conclusion. The DWP’s research shows that people use pension income to supplement other activities such as childcare and helping to support younger generations in work. Importantly, accessing pension income can help significant numbers of individuals to change vocation, work flexibly or go part-time, which allows them to stay in employment where they may otherwise have left the workforce.

I will now turn to the last main theme of the report—migration. On 4 December 2023 the Government announced a new package of measures to curb immigration abuse and further reduce net migration. The Government have been mindful of the need to balance the impacts on the labour market against the need to reduce net migration. These reforms are the right package to support reducing net migration to sustainable levels while enabling the UK economy to access the skills and talent we need. We understand that some sectors may be concerned about their ability to fill certain roles. I strongly encourage any employer, of whatever size, sector or place, to engage with their local jobcentre or the DWP nationally if they are looking to recruit. Our jobcentres have a fantastic offer for employers, including help with job adverts and recruitment opportunities to connect directly with jobseekers at job fairs and other events, and access to government-funded training.

The hospitality sector, which is very close to the heart of the noble Lord, Lord Bilimoria, is mentioned in the report. This is a fantastic example of the DWP supporting vital sectors. Working with UK hospitality and employers such as Greene King, Hilton and Premier Inn Limited—and, I am sure, Cobra Beer—we recently launched a new destination hospitality pilot. These are innovative new schemes which combine training, work experience and a guaranteed job interview, and demonstrate the availability of motivated jobseekers for firms that are looking to recruit.

Turning to the theme of childminders and universal credit, my noble friend Lord Willetts and the noble Baroness, Lady Kramer, alluded to the relevant issue of parents entering the workplace. The Government very much know that the cost of childcare remains a critical barrier preventing many people re-entering the workforce. This is why we are delivering the biggest expansion in childcare support in England’s history—to help parents on universal credit who are moving into work or increasing their hours. Since last June, the Government have been providing additional support with upfront childcare costs. Last June, we also increased the childcare costs that parents on UC can claim back by nearly 50%, to up to £951 per month for one child and £1,630 for two or more children. Also, the Government are aware of the demand/supply issue in childcare and the increased demand for nurseries, and we are working very closely with the DfE to address this very point.

The noble Baroness, Lady Kramer, mentioned apprenticeships, and as you can see from the badge with the big capital A that I am wearing, this is National Apprenticeship Week. It would be remiss of me not to take this opportunity to promote apprenticeships as a further example of how firms can secure the staff that they need and support them to build their skills. My noble friend Lady Noakes, the noble Viscount, Lord Chandos, and the noble Baroness, Lady Sherlock, spoke about the workforce participation review, and the gist of their question was: is this the end of it all? Since last year’s Spring Budget, we have announced our back to work plan, investing another £2.5 billion to boost workforce participation. We continue to work across government to tackle barriers to work and decreases in activity. This is not the end of the story, as the announcements made at the Autumn Statement show. However, the Government will continue to consider how we can increase workforce participation. The best thing to do would be to write further on this because it is an important point.

We know that the labour market is complex; as the noble Viscount, Lord Chandos, put it succinctly, it is rather complicated. It is an oversimplification to think that, because we have nearly a million vacancies and many more millions of inactive people, it is straightforward to match the two to ease labour shortages. The Lords Economic Affairs Committee’s report skilfully set out many of the challenges in filling vacancies amid a changing labour market. As such, the DWP is continually analysing what skills are required to ensure that there is a plethora of support for our customers in this ever-changing landscape and to take the steps to tackle whatever barriers they face. For the avoidance of doubt, and for the benefit of the noble Viscount, I say that we certainly get the importance of this subject, but I hope I have given a flavour of the huge number of initiatives that my department is taking and how it is working across government on this important area.

I opened by reflecting on the significant progress we have made as a country over the last 50 years on female labour market participation. I will turn to the future of the labour market and the role that technology will play but, before I do, I will pick up a few more brief points. The noble Lord, Lord Bilimoria, mentioned that he was on the New Deal task force and asked if such a thing still exists. It does not, but the Government work with a wide range of stakeholders when developing and evaluating our policy interventions. He also spoke passionately about dentistry. As part of the NHS long-term workforce plan, we will build a pipeline of new dentists for the future by expanding dental undergraduate training places by 40% to more than 1,100 per year by 2031 up to 2032, with an additional 24% increase to 1,000 places by 2028-29. The Government will also consult this spring on the tie-ins for dentist graduates to the NHS and increase the number of dental therapists and other dental care professionals through a 40% increase to more than 500 training places per year by 2031-32. Lastly, the Government will make it easier for NHS practices to recruit overseas dentists who meet the UK’s highest regulatory standards.

My noble friend Lord Balfe raised a point that I alluded to at the beginning of my remarks about treating workers better, and he is right. The 2019 manifesto pledged changes to enhance workers’ rights and support people to stay in work. The Government have delivered on these commitments by supporting a package of six Private Members’ Bills, helping new parents, unpaid carers and hospitality workers, and giving all employees easier access to flexible working and giving all workers a right to request a more predictable working pattern.

Just before I conclude, I will address a couple more points that were raised by the right reverend Prelate the Bishop of Bristol and alluded to by the noble Baroness, Lady Kramer, on AI—a very important subject generally. The priority of the Department for Work and Pensions in the labour market is to ensure that people continue to have access to good and meaningful work. This involves adapting to structural changes in the labour market now and in the longer term. There is a lot going on in my department on AI, and I will add that to the letter I am writing, and I will copy in all Peers.

I conclude by reflecting on the fact that, this month 40 years ago, this House was debating the degree of emphasis on new technologies in youth training schemes. We have seen the positive impact that computers have had on the workplace since then. As new technologies such as AI emerge, the DWP’s key focus will be to understand their impacts on the labour market and harness their potential to better support people to work. I hope that, in another 40 years, this House will reflect on the contribution that these new technologies have made to similar improvements in the labour market participation of other groups.

Disability Action Plan

Viscount Younger of Leckie Excerpts

Tuesday 6th February 2024 Lords Chamber

[Baroness Brinton (LD)]

My Lords, I declare an interest as vice-president of the Local Government Association. In that capacity, I am currently chairing the LGA disability forum for council officers and for members.

I am grateful to follow on from the noble Baroness, Lady Sherlock, partly because she summarises the issues about benefits so well. It also means that I do not have to say them again, because I completely agree with her concerns and her questions.

I am going to pick three or four things from the areas for action that give me real cause for concern that this new plan does not recognise the mess that the Government have got themselves into in the past. I want to start with the support for disabled people who want to be elected to public office. It says on page 15 of the Disability Action Plan that the coalition Government

“provided some financial support in the past, such as the Access to Elected Office Fund, which ran between 2012 and 2015”.

I wonder why it stopped in 2015. Who cancelled it? It was created by my noble friend Lady Featherstone when she was a Minister in the other place. It was cut the moment that we left government. The onus was put on political parties to provide it. That may be fine if you are the Conservative Party with millions and millions of pounds, but small parties do not have the capacity to fund the sort of things that are needed, such as BSL interpreters for a candidate. As far as I am aware, there has never been either a Member of Parliament or a Peer who uses BSL as their first language. That is because the barrier to get them into Parliament is too high for them to bear on their own. Action 2 in the Disability Action Plan states that the

“DU will develop and publish new guidance by summer”,

but until then the current arrangement will continue—so great words, but no change really.

The second action is another that has been raised in your Lordships’ House on a number of occasions: disabled people’s needs in emergency and resilience planning. About a year ago, when we were concerned about energy prices and the shortage of energy as a result of Russia’s invasion of Ukraine, I asked a Minister in the then BEIS to look at how we could ensure that significant power outages did not hurt the people who relied entirely on emergency support when the power went out for more than an hour or two once their own batteries had gone down. People such as our own colleague, the noble Baroness, Lady Campbell of Surbiton, would be one of those affected.

The plan says:

“Government departments already consider disabled people’s needs in emergency and resilience planning, in line with the Public Sector Equality Duty”.


On 16 January, however, the Department for Health and Social Care—which, somehow, in the game of “Don’t sit down last,” ended up taking on responsibility from BEIS for the negotiations with the energy companies on what to do in power outages—wrote to John Pring of Disability News Service saying:

“We have concluded that, due to the specificity of individual needs and circumstances, individuals and their care teams are best placed to develop plans for how they can prepare for and respond to loss of power to their home”.

That is not government departments working together; it is worse than that. A year on, there is now no way that any disabled person who relies on power can go to anybody in government to say, “My energy company is not helping me”. My baby granddaughter, who was on a ventilator for the first three years of her life, had one such power outage in her area. Had she not been in a carrycot and been able to be brought out of the outage—which adults cannot do—she would have hit very serious problems, so, for me, this is a very personal matter.

The plan says that the Government were learning from previous events such as the Covid-19 pandemic and the Grenfell Tower fire. I remind the House that we still do not have PEEPs post-Grenfell fire, which is a very serious issue if you are in a wheelchair and are trying to get down even five flights of stairs—let me put it more bluntly: even one flight of stairs. I am afraid that the actions on that are unworkable.

The section on families in which someone is disabled says the right words, but this Government have consistently starved local government of funding for children’s services, including for education, health and care plans. As a result, schools and the local authorities have zero money to be able to provide, which is why many children are not able to access the help that they are entitled to under the law.

The noble Baroness, Lady Sherlock, mentioned issues relating to assistance dogs. Dr Amy Kavanagh, who is a blind activist, said today on social media:

“We don’t need to define assistance dogs. The law does this already. I would welcome an ADA ‘legal questions you can ask’ model. Is the dog supporting a disability?”—


what on earth does that mean? She continues:

“What tasks does the dog perform?”


Frankly, once somebody has an assistance dog, it should not be necessary for a taxi driver to say, “What task does your dog perform?” That is the point at which there is a problem, and the answer is very simple: it is illegal to stop it. Yes, the Government are right: we need to make sure that more businesses know what they are doing.

Katie Pennick, from Transport for All, said that there is:

“Nothing on transport, nothing on housing, nothing on social care, nothing on PIP, nothing on hate crime, nothing on urban planning, nothing on healthcare, nothing nothing nothing…”


Rachel Charlton-Dailey said that, this week:

“Many disabled people are once again missing out on the gov cost of living payment … those on personal independence payment (PIP) or its predecessor disability living allowance (DLA) have received … £300, while those on benefits such as universal credit, child tax credits and employment support allowance will have got £900”.


That is discrimination against disabled people who, as we have heard, have much higher energy costs.

I will not repeat the data mentioned by the noble Baroness, Lady Sherlock, but I want to mention one final thing about the two Bills that are cited in the plan: the British Sign Language Act 2022 and the Down Syndrome Act 2022. When the Down Syndrome Act went through your Lordships’ House, we were promised that other genetic conditions would be looked at. Nobody understood why just one condition got the support. Nothing to date has happened. Worse than that, no funding has been allocated whatever, even under the terms of the Down Syndrome Act. It feels like everything else that I covered so far: warm words but no actual benefits to disabled people.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, I thank the noble Baronesses, Lady Sherlock and Lady Brinton, for responding to the Disability Action Plan. I appreciate that the noble Baroness, Lady Sherlock, said that there were some positives in it, but I acknowledge that the noble Baroness, Lady Brinton, is not in that position. I hope that in answering all, or nearly all, of the questions that they have raised, I can change her mind, but I am not sure that I will be able to.

The noble Baroness, Lady Sherlock, spoke about our track record. I want to give her a very brief potted history of what has happened here and where we have got to. I hope that will help to provide some perspective for the noble Baroness, Lady Brinton. As the noble Baronesses will know, the Government published a draft plan for consultation over the summer so that disabled people, disabled people’s organisations and other interested parties had the opportunity to have their say. The consultation was open for 12 weeks and we received more than 1,300 written responses. In addition to that, we held a series of 25 events during the consultation period, with more than 130 attendees, including experts from a range of sectors. Jumping forward, on 5 February 2024, the Government published the Disability Action Plan.

The Disability Action Plan complements the long-term vision set out in the cross-government national disability strategy. They will be taken forward in parallel, sharing the Government’s commitment to improving the daily lives of disabled people in the here and now and in the years to come. It is the short term and the long term. Significant work is already being taken forward by individual government departments in areas that disabled people have told us are a priority. This includes reforms to employment and welfare via DWP’s Transforming Support: The Health and Disability White Paper and strategies to address health and social care via DHSC’s People at the Heart of Care White Paper.

These long-term reform efforts are already under way, so I make the point that there is some good work under way; it is not just that we have been waiting for those consultations. I will also say that this Government are aware that there are many suggested areas where people highlighted that the consultation was not within the scope of the action plan, and therefore that they had not been included in it. That does not mean that work has not been happening in these areas. It is important to remember that the action plan is only one pillar among many pillars of work being taken forward by this Government to improve the daily lives of disabled people. The plan also sits alongside the national disability strategy and other long-term work across government supporting disabled people, including support with the cost of living, which I will come to in a moment, through Help for Households, as well as the SEND and alternative provision improvement plans.

That takes me neatly on to the cost of living, which was raised with some passion by the noble Baroness, Lady Sherlock. We have committed to continue working across government to highlight disabled people’s concerns, experiences and insights on this topic. That includes sharing findings from this consultation and from disabled people’s experience panels. This work is in addition to broader work across government to support the people most significantly impacted by the rising cost of living.

Both noble Baronesses will know about the statistics, but they are worth repeating. In doing so, I for one understand that there are severe hardships around; I will not cover over those. Taken together, support for households to help with the high costs of living is worth £104 billion over 2022-23 to 2024-25. Over 8 million UK households on eligible means-tested benefits will receive up to three additional cost of living payments, totalling up to £900. The noble Baronesses will know that, from yesterday, the final payment will be paid at £299. I do not think that it is worth rehearsing now all the other aspects, because the noble Baronesses will be well aware of them. But perhaps it will be helpful for me to say that we really are aware of the pressures, particularly for disabled groups.

I will address the point raised by the noble Baroness, Lady Sherlock, on the work capability assessment reforms. We are committed to ensuring that our welfare system encourages and supports people into work, while providing a vital safety net for those who need it most. As she will know, from 2025 we will reform the work capability assessment to reflect new flexibilities in the labour market and greater employment opportunities for disabled people and people with health conditions, while maintaining protections for those with the most significant health conditions. Our expanded employment and health offer will provide integrated and tailored support for disabled people to support them and help move claimants closer to work.

I will go a little further: the work capability assessment reforms are not about sanctioning people or forcing them into work where it is not appropriate. I reassure both noble Baronesses that we will continue to protect those with the most severe conditions, while ensuring that those who can work are supported in doing so. In the future, removing the WCA will reduce the number of assessments that people need to take to access benefits, give people the confidence to try work and—this is a very important point—enable us to provide more personalised support so they will meet a real human being.

The noble Baroness, Lady Sherlock, asked about PIP and whether there was a place for vulnerable PIP claimants. The answer is yes. We have some extremely vulnerable customers, which is why we provide additional support during the claims process, if required. This support can include help with filling in the form or questionnaire, and additional protections for failing to return the questionnaire or for failing to attend an assessment. Before attending a face-to-face, telephone or video consultation, claimants are given the opportunity to alert their assessment provider to any additional requirements they may have, and the providers will meet any such reasonable requests. Again, it is important to get the message across that, for the most vulnerable, we really are there to hold their hand and make sure that the process is made easier for them.

The noble Baroness, Lady Brinton, raised an interesting point about the areas we are focusing on to encourage more disabled people to stand for election. We do think this is incredibly important—as are the points that she raised. The new fund will be launched in 2025, following the design and development work informed by and through engagement with disabled people. This will ensure a long-term solution that meets users’ needs, learning lessons from previous elected office funds.

The noble Baroness made a point about timing. She will know—and said, I think—that, in the meantime, the disability unit will develop and publish new guidance by summer 2024. Yes, those are words, but there are also actions. I am making the point that this needs to be done over the long term. It is very important that political parties and elected public bodies can best support disabled candidates, drawing lessons from the Local Government Association’s work and other sources. That will help to improve support in the short term, while we establish—I make this emphasis again—a new long-term approach.

The noble Baroness, Lady Brinton, asked about addressing the question of public health and emergency planning information—which is another important point. The Minister for Disabled People, Health and Work will lead a discussion with the ministerial disability champions on the importance of accessible communications, with a particular focus on improving accessible communications and information regarding resilience and emergencies. That is just one action among a series of actions being taken to improve the accessibility of government communications.

I have just a few more points to make, including on families, which was a subject raised by the noble Baroness, Lady Sherlock. Yes, families are important. The disability unit will explore and develop a new accessible online information hub for families with disabled members. That work complements work led by the DfE to roll out family hubs. The DU will work with partners to develop new products addressing specific issues experienced by families with disabled members. I cannot quite recall the noble Baroness’s precise question, but I reassure her that this is important; it is a key area. She may want more action, so I will read Hansard and write to her if there is more that we can say on that.

Finally, the noble Baroness, Lady Brinton, raised a point about assistance dogs. Our focus is on all assistance dogs, but we are seeking to build on the excellent work of Guide Dogs UK. I attended a reception it led the other day. Its “Open Doors” campaign seeks the fullest possible access to public places for people with guide dogs. Progress on educating the business sector on the law and the negative impact that access refusals can have on people’s confidence and ability to live an independent life will have a positive impact on all assistance dog users.

[Lord Young of Cookham (Con)]

My Lords, the Disability Action Plan deserves a slightly warmer welcome than it has received so far. The 32 actions will make a difference in the daily lives of disabled people, but we have further progress to make.

I will pick up on two points, one of which was touched on by the noble Baroness, Lady Brinton. The summary of the consultation findings at page 18 says:

“The need for more disability inclusion in local and national planning was another strong theme”.


I do not know whether my noble friend was in his place yesterday when there was an exchange about the building regulations and the proposed improved accessibility for new homes. Everybody welcomed the decision to move to the new standards, but there was some difficulty in finding a date when they would be introduced. Can my noble friend liaise with his colleagues in DLUHC and use his influence to ensure that the remaining consultations that still need to take place can be done very quickly so that we can have a start date for these new accessible homes?

The second point relates to parents with a child who has a learning difficulty. I welcome the recent announcements extending free childcare, which will be rolled out first in April, then in September and again next year. There is some anecdotal evidence that parents with a child who has a learning disability are finding it difficult to find a place in a nursery or other daycare facility for their child. I know that there is some assistance available if the child gets DLA. There may be other forms of assistance to day nurseries in other circumstances, but they sound a bit bureaucratic. Can my noble friend liaise with colleagues in the DfE to make sure that children under five with a learning disability get the support they need? They need that support every bit as much as, if not more than, children without a learning disability.

[Viscount Younger of Leckie (Con)]

I thank my noble friend for not one but two questions. Perhaps I can answer the first one by saying, as I think my noble friend said, that the Government have set out their intention to mandate higher accessibility standards for all new homes by raising the minimum standard in building regulations in England. I am not sure that I can help with the date, but I will certainly take that back to my colleagues in DLUHC. We will consult further on the technical changes needed to mandate the higher M4(2) accessibility standard, on changes to statutory guidance and on our approach to how exceptions will apply. Making the M4(2) the new default standard will require additional features, including a living area at entrance level, step-free access to all entrance-level rooms and facilities, and wider doorways and corridors, as well as clear access routes to windows. I hope that helps my noble friend.

He asked about day nurseries and support for disabled children under five. I happened to hear the Secretary of State for Education say that she was confident about the demand for nurseries being in a better place. I had better write to my noble friend about this specific issue. I hope I can provide similar reassurances.

[Lord Dodds of Duncairn (DUP)]

My Lords, I welcome the repeat of the Statement and the launch of the Disability Action Plan. One of the action areas that particularly struck me was about making playgrounds more accessible for everybody. That is an extremely important issue that a number of my colleagues in local councils in Northern Ireland have very successfully made a priority. I very much welcome its inclusion here; I commend the plan on that.

The Minister referred to other areas of work that disabled people have told us are priorities. These include employment and welfare reforms. As the Minister will know, the newly reformed Northern Ireland Executive and Assembly have responsibility for welfare, although we follow the principle of parity across the board in social security and so forth, for the obvious reason that to depart from what happens in the rest of the UK would cost an enormous amount of money to the block grant. While this is devolved in Northern Ireland, in effect we have to follow the same rules. Can the Minister assure me that, when proposals and their impacts are considered, there will be the closest possible consultation and work with the relevant departments in Northern Ireland and with the people who will be affected?

[Viscount Younger of Leckie (Con)]

Absolutely. I start by saying how pleased I am that the Northern Ireland Assembly is up and running. I was a Government Whip for the Northern Ireland Office, so I am very aware of many of the issues.

On the second point, as the noble Lord said, the remit of the Disability Action Plan is very much within the competence of the UK Government. However, we have engaged officials in all the devolved Administrations. I am pleased to say that we will work together with our counterparts where appropriate to our mutual benefit. One example is the foresight research that we will undertake, on which the devolved Administrations have expressed interest in working with us. I am sure the noble Lord will know that we have had and continue to have more than cordial relations with senior officials in Northern Ireland in order to maintain the necessary stability during the past two years.

On the noble Lord’s first point, about playgrounds, I am very pleased that he applauds this approach. I reiterate what we are planning to do. The disability unit will create an online hub of information for local authorities on creating accessible playgrounds and will explore the most effective way of creating guidance on how to develop more inclusive and accessible playgrounds. This is on the back of stakeholders having highlighted a lack of funding for local authorities, which is often a big issue. Obviously, we are exploring this with families with disabled members and with service providers to see how we will take it forward.

House adjourned at 8.24 pm.