Welfare Reform Bill

Baroness Hollis of Heigham Excerpts

Wednesday 16th November 2011 Grand Committee

[Lord Low of Dalston]

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

[Baroness Hollis of Heigham]

Lucky man.

[Lord Low of Dalston]

I particularly support the idea of a trial period before incurring huge public expenditure in reassessing 2 million disabled people, many of whom really do not need it, for example, if their circumstances are unlikely to change. Where there is written evidence of severe impairments, it is simply common sense to accept that evidence and avoid putting people through costly and potentially distressing face-to-face interviews. Setting out criteria that would signal eligibility for PIP without an interview is an administratively simple way to indentify those who have severe impairments that have already been assessed through written evidence as giving rise to a higher level care or mobility need.

The Government have said that they do not think it is right that we should judge people purely on the type of health condition or impairment they have, making blanket decisions about benefit entitlement. One can understand their desire to personalise the assessment process when the impact of an impairment may not be clear. However, it is obvious that in some cases the impact is clear from written evidence and beyond dispute in terms of its implications for the rate of PIP that should be awarded. For some groups of people it is perfectly clear from the severity of their impairment that they should be eligible for enhanced rates of PIP without further assessment. For example, if someone is deafblind, a face-to-face interview to establish that they have mobility needs of the highest level is barmy. If someone has no sight at all or no legs, no further assessment is needed to confirm that they have a high level of mobility need. In cases such as these, a face-to-face interview is simply a waste of money. In addition to avoiding unnecessary stress for severely disabled people, this amendment would save money for the taxpayer. It feels pretty much like a no-brainer to me.

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Given the assurances I have provided, I urge the noble Baroness to withdraw her amendment.

[Baroness Hollis of Heigham]

My Lords, can I make one proposal to the Minister? He may not feel able to accept this amendment—although given the strength of feeling in Committee I hope very much he takes it back and reflects on whether he can move more than he has been able to do today, otherwise I am sure it will come up on Report. Can he at least consider, as a fall-back position, that for a year new applicants who have been refused and existing applicants who are currently on DLA who will lose entitlement under the proposed new PIP would have a further personal review stage put into the system? This would involve not just the decision-maker but the disability organisations so they can work through the material themselves to see whether they would uphold the decision.

The Minister and the department will need additional knowledge-building within the decision-making process. The best way to do that in that first year may be to look at the cases that are being refused or declined and reconsider them before the applicant is notified. This would ensure that errors have not been made and that the decision-maker understands fully—in the light of real expertise coming from the relevant associations and organisations—where that may take him or her. I would suggest a further stage of at least 12 months of a review process within the department in which rejections are analysed a second time around with the help of representatives from disability organisations which are experienced in these matters so that we build up expertise.

[Lord Freud]

My Lords, I am very happy to reflect on that rather interesting point. I will go back and think about that very hard.

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While we are seeking to take aids and appliances into account in an appropriate way, we ultimately believe that the greatest support should go to those least able to participate. Someone who can get around with the help of an aid such as a walking stick or frame definitely faces considerable barriers and is likely to have some increased costs. We will seek to recognise this in the assessment by awarding points where aids are needed. For example, in considering activity 2—moving around—the assessment clearly recognises that someone who requires a wheelchair for short distances will get at least 12 points, and someone who requires other aids such as a frame to travel short distances may receive 10 points.

[Baroness Hollis of Heigham]

How many points do you need altogether if one produces 10 and the other produces 12?

[Lord Freud]

My Lords, this is a matter to be revealed at a somewhat later date. I am pleased to have provided a timetable of when this matter will become clear. However, the direction of travel is clear: the maximum number of points on that one is 15.

I almost want to call the noble Baroness, Lady Campbell, my noble friend, but I am not allowed to do so. I invite the noble Baroness to join me; I have to find an appropriate enticement so that I can call her my noble friend. However, I must disagree with her concerns. I suggest that she is likely to score very highly in the assessment by way of the very aids and appliances that she has highlighted. As I said, electric wheelchairs are right at the top of that measure at 15 points. We will produce case studies by the time PIP is debated on Report which clearly illustrate how individuals who successfully use aids and appliances will continue to receive PIP in a similar way as they do with DLA.

I turn to the noble Baroness’s second amendment. We are committed to personal independence payment, like disability living allowance, being an extra-costs benefit for disabled people, to spend on whatever they see fit. Our experience of DLA tells us that in some cases the money will go towards the cost and upkeep of specific purchases or activities, such as aids or appliances, or that it may simply become part of the disabled person’s budget paying for things as and when they come up, such as the need for shopping deliveries or taxis. The clear intent is that the mobility component should be used to help improve the disabled person’s ability to get around but we have no wish to prescribe how they should spend the money.

Given that the purpose of the benefit is to contribute to disability-related costs such as aids and appliances, and that there are other support means available, we do not think we should be paying for aids and appliances in addition to this. Given these comments and the reassurances that I hope I have given on how aids and appliances will be treated in the assessment, I urge the noble Baroness to withdraw her amendments.

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[Lord Freud]

My Lords, I thank noble Lords for tabling these amendments and welcome the opportunity to respond on this important feature of personal independence payment. The required period condition has given rise to a great deal of considered and reasoned debate today. The debate has also been informed by the not inconsiderable assistance of briefing provided by the likes of Macmillan Cancer Support and the Disability Benefits Consortium, as well as many others over the past few months.

The amendments seek primarily to shorten the qualifying period before the personal independence payment can be paid. They also increase the onward period over which someone must be expected to satisfy the conditions of entitlement and modify how someone can satisfy the required period condition. Taken together, I was pleased to see that Amendments 86A to D preserve the overall required period condition of 12 months. I therefore welcome the fact that these amendments explicitly accept the principle that personal independence payment should be paid only to people whose needs arise from long-term conditions. This is a fundamental aim of personal independence payment and ties our definition of long-term disability in with that used in the Equality Act.

Under disability living allowance, people currently have to satisfy a three-month qualifying period and a six-month prospective test. These rules were put in place when the old attendance allowance and mobility allowance were merged to form DLA in 1992. However, for personal independence payment we are designing a new benefit; one fit for the 21st century, so it is only right that we looked at what it is the most appropriate length of the qualifying period and prospective test.

I know how much these changes to the qualifying period have worried certain groups of disabled people and their representatives, most particularly those representing people who have been diagnosed with cancer or who have experienced sudden-onset conditions. Noble Lords may be interested to learn that the changes found support in our consultation, in particular the link with the Equality Act definition.

Perhaps it may help to reassure noble Lords further if I set out that the required period condition is not a money-saving measure, nor is it meant to deny disabled people support where the impact of their condition is long-term. This is about having a mechanism which can identify, assess and pay a valuable cash benefit to individuals who have a long-term health condition or impairment which results in burdensome financial costs, regardless of income. Personal independence payment is not designed to assist individuals dealing with short-term needs.

Where there are immediate and ongoing costs which can cause financial difficulties, or have an effect on someone’s ability to participate fully so that their levels of independence may begin to suffer, there is a range of means-tested and non-means-tested support to help people through some of the shorter-term burdens, both financial and practical. I acknowledge that this help may not be available to all, but all provision has to be dictated by balancing need and an individual’s capacity to meet it from their own resources.

[Baroness Hollis of Heigham]

Can the noble Lord give us examples of that? Like others, I have nursed people through cancer—three people, including my late husband—and what we need is what does not exist, which is an upfront grant to cover costs until the condition has stabilised. During those six months, in his situation, I was all right, as I could throw money at it, but I noticed that in the waiting rooms for chemo and radio, then back to chemo and then to radio, a constant theme for the people there—some were feisty, some were broken, some were defeated and some were coping—was the huge financial pressures, particularly on those who did not have an adequate income or adequate family support to allow them to cope. If the Minister cannot move in this direction, he has to come up with something that will do the same job.

[Lord Freud]

My Lords, among the elements available in the shorter term are healthcare, travel costs, free prescriptions or aids and appliances provided by the NHS or the local authority. Following the request by the noble Lord, Lord McKenzie, it may be easier for me to write with a list of particular supports.

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[Lord Freud]

I have slight jitters about that level of transparency, apparently.

[Baroness Hollis of Heigham]

Would it be the Treasury?

[Lord Freud]

No, no, no. The Treasury is not a disability organisation, let me assure you. Those who know the Treasury well will be absolutely confident in that description.

As I said, it is not a cost matter. It is a matter where people’s sensitivities have been very clearly expressed. We will go away to look at that very, very closely. Some of the observations in this room today will help us in that consideration.

I do not know if there are any other points I really need to make. I just reassure or assure the noble Baroness, Lady Howe, that the required-period condition will not be a snapshot in time. The legislation makes that quite clear by talking about the likelihood of the assessment being met on any particular day. It means that if someone is likely to meet the conditions for the majority of the time, they can safely be taken as being more likely than not to meet them than if we were just randomly to pick a day.

The other issue I need just to touch on, which is often misunderstood, is that during people’s stay in hospital, when the cost of their disability-related needs are being met, individuals will already be fulfilling the required-period condition for personal independence payment. The noble Baroness, Lady Campbell, was concerned that filling in your DLA or PIP assessment form was not the first thing on your mind.

That means that when someone is able to leave hospital, perhaps with a care plan in place and further rehabilitation scheduled, they may well have satisfied some or even all of the qualifying period. That currently exists for DLA and is often misunderstood, with people thinking that they become entitled only after they have filled in and submitted the form. The qualifying date starts on the day that the needs arise—the day you have the accident that has caused a particular problem, for instance—not from when the claim form is submitted. I acknowledge that some conditions that arise gradually and it is very difficult to pinpoint the precise day.

With those observations and commitments to reflect, I ask the noble Baroness to withdraw the amendment.

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[Lord Freud]

My Lords, we have made a number of commitments in relation to people aged 65 and over. Noble Lords may be aware that alongside the Government’s response to the consultation on DLA reform, we also published a policy briefing in May that set out our policy objectives and proposals. We intend to make regulations for personal independence payment that will allow people who have reached the upper age limit to continue to receive personal independence payment. Our priority is to support those individuals with established, long-term health conditions or impairments that would put them at a financial disadvantage over a long period. We fully understand that receiving this benefit is important for those aged 65 and over, particularly for those in receipt of the mobility component. We also know about their concern that the loss of entitlement could affect their independence.

The intention behind this amendment is to ensure ongoing support throughout later life for individuals whose abilities are limited earlier in life, recognising that they may have had less opportunity to earn and save for later life. I can assure noble Lords that this is also our intention and that it can be achieved without amendment to the Bill, but instead through regulations. As it currently stands, the amendment would potentially widen the scope of the personal independence payment and undermine our intention of creating a more affordable and sustainable benefit.

Turning to the current rules, broadly speaking, current DLA provisions have a one-year linking rule. This allows individuals over 65 to renew an award within one year of their previous award without losing DLA entitlement. Similarly, we intend to allow a linking period for PIP. This will support those individuals who reach the upper age limit and have a break in their claim through temporary improvement, provided the individual makes a claim within a defined period and continues to fulfil the eligibility criteria for PIP. As with DLA, there will be restrictions on new and existing claims for those over the age of 65. As I have said, our priority is to target support, through PIP, on disabled individuals with established, long-term health conditions or impairments, who may incur extra costs throughout their early lives and would have had less opportunity to save for retirement. Those individuals who develop care needs later in life, as part of the natural ageing process, will continue to be able to claim attendance allowance provided they meet the eligibility criteria.

Under Clause 81 we already have a power to make secondary legislation and to provide for exceptions. By setting out these provisions in regulations we can ensure that the legislation can be adapted in response to any future changes in the social care system which might affect pensioners. The Personal Independence Payment Implementation Development Group will strive to ensure that policy design and delivery in respect of people aged 65 and over is informed by disabled people and their representatives.

On the question raised by the noble Lord, Lord McKenzie, on what happens to DLA recipients over the age of 65 whose fixed term expires, we have made it clear that they will not be within the scope of PIP for the time being. That means that existing recipients of DLA aged 64 or over at April 2013 would be invited to reclaim DLA towards the end of an existing fixed-term award. At this stage we have made no decisions on the rates of PIP or how these will compare with other benefits.

[Baroness Hollis of Heigham]

In that case, how does the Minister establish any smooth movement on to attendance allowance, given that attendance allowance is not coming within UC?

[Lord Freud]

Clearly, that will be one of the issues we will need to take into account when we sit down to establish these rates. Given these reassurances on our approach, I urge the noble Baroness to withdraw this amendment.

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[Lord Freud]

My Lords, perhaps I might again interpose slightly out of order in the interests of clarity. I am grateful to the noble Baroness, Lady Hollins, for tabling the amendment and for making some valid points. I revert to my opening comments today on the timing of the information. We aim to get more information on the passporting arrangements from PIP to carers’ allowance prior to the start of the Report stage, which I hope will satisfy the request. I should add that we are sympathetic to the position of carers—which I hope is recognisable code—and the Government recognise the important role that people with caring responsibilities have in our society. We are continuing to listen very carefully to the contributions that we receive.

I cannot at this stage add anything further. I therefore urge the noble Baroness to withdraw her amendment, which clearly we will be able to consider in more detail in a little while.

[Baroness Hollis of Heigham]

My Lords, I apologise to the Minister for being fractionally late and therefore missing his statement. Had I been here, I would no doubt have been pushing him on the questions I now want to raise.

Although we welcome and very much appreciate that the passporting arrangements will be with us before the start of Report, we also need to know the statistics, the numbers. In other words, to what extent will the existing case load of people on middle and higher-rate DLA go through into PIP? Will some of those on the lower rate now come into PIP? If carers are passported, as the Minister gave us hope to believe, from both rates of PIP, will that mean there will be more carers in future because some lower-rate carers will be joining them, or will some disabled people on what is currently the middle rate of DLA, which entitles their carer to receive carers’ allowance, fall out of PIP altogether?

Until we know the mapping of the numbers we cannot understand the implications of the very helpful information the Minister is going to make available. The crude fact is that any carer who is now on CA who finds that the person they are caring for will fall out of middle-rate DLA—therefore they may fall out of even a relatively supportive interpretation of the new PIP arrangements with both tiers entitling you on to it—will then find themselves suddenly excluded from having carers’ allowance. Because they are caring for someone for 35 hours a week, that will vanish. As a result they will be exposed to full, in-work conditionality even though the care needs of that person—35 hours a week—will not disappear.

We need to know those numbers and they are issues that we are going to have to reflect on in Committee before we get to the relevant clauses associated with DLA and ESA. Will the noble Lord kindly say whether he will be able not just to tell us before Report, as I hope, that both the upper and lower rate of PIP will entitle you to carers’ allowance but how those two populations rub on to the two existing populations? Will there be losers as well as possibly gainers among carers with all the possible implications they will be exposed to? The Minister may be able to tell us what happens to disabled people and the numbers coming into the PIP framework.

[Baroness Howe of Idlicote]

My Lords, I hope the Committee will forgive me for coming in at this stage. Earlier today, Carers UK asked me to ask a supplementary on this which is not dissimilar from what we have just heard. There are more than 560 carers receiving carers’ allowance and so on and they may well transfer over into PIP. The Minister has made it clear that decisions are going to be made and will be looked at in detail, but these are the questions Carers UK wanted me to ask. First, what assessments are being made on the impact of carers of the two options available—establishing eligibility through both rates or just through the enhanced rate of the daily living component? Secondly, if the Minister is unable to announce a decision—which he obviously is—on which rate will lead to eligibility for carers’ allowance, will he publish the assessments of the impact on both options so that the Committee can discuss their implications?

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[Lord Freud]

My Lords, as always, the questioning is pinpoint in its precision to rip open any veils that I may be draping over myself. I speak in the spirit of Salome. As I said, before Report begins, I will provide more information about the passporting arrangements from PIP to carers’ allowance. I cannot say more than that today or in practice, as noble Lords are aware, I would end up making the announcement, which I am not in a position to do. Threshold information for PIP will be available prior to the specific Report discussion on that part of the Bill.

[Baroness Hollis of Heigham]

Does the Minister accept the point that my noble friend made very fully, that we cannot do it that way around? It is back to front. We have to know what the thresholds are for PIP to know which and how many carers will be passported on, on either assumption, whether it is one band or both bands. The Minister has been very sympathetic on this, but unless we have that information, the information on carers will tell us only the mechanism, not the effect. We have to know the effect.

[Lord Freud]

My Lords, I feel slightly as though I have trapped myself, and I will explain exactly why. I spent a lot of time on the carers’ allowance. I was very worried about the cliff edge at £100 earnings, and so I reinserted a carers’ element into the universal credit, very deliberately, to get rid of that and to have a smoothed effect. I have spent some money—or we the taxpayers have spent some money; it is not out of my own pocket—and I find myself slightly hoist on my own petard by the noble Baroness, Lady Hollis, by making a subtle connection between the universal credit and the carers’ allowance. This was not there originally, when it was a carers’ allowance.

I see that there is a connection—I have created it, but it is fairly narrow—to get that taper to work. It does not undermine the way in which we think about carers and the way in which we look at the universal credit. As I say, I will be able to explain the principles of how the allowance will work right at the start. We will see the actual numbers later when we start to look at the real carers’ allowance. I think noble Lords should be more tolerant of me than they are being.

[Baroness Hollis of Heigham]

I should be very tolerant of the Minister if he had answered the question. However, my question was not about tapers and the interplay of carers’ allowance; that is a genuine set of questions, but not the one I was trying to explore. I was saying that because carers’ allowance is a passported benefit, we have to discuss, and have to know, how many people will be entitled to the original benefit, from which carers are passported, to calculate how many carers will or will not continue to qualify for carers’ allowance. If they do not qualify for it absolutely, then they come into the in-work conditionality issues that some of us are worried they may be exposed to. For once I think the Minister has not understood where I was coming from on this, which was not about tapers and the interplay; that is a separate bundle of issues that we will no doubt seek to tease out.

Let us assume that both levels of PIP, standard and enhanced, entitle you to a carers’ allowance. That would be very good news. However, we need to know how many disabled people are entitled to the standard rate of PIP, and whether it is just the people currently on the middle rate, or some of the people currently on the lower rate as well, or fewer people than who are on the middle rate now, who will be entitled to that lower rate. Only then can we work out how many carers will be affected, numerically. We cannot discuss, therefore, the extent and the value of a passported benefit until we know the original client group on whom that passport is dependent.

[Lord Freud]

My Lords, as I have tried to explain, we will introduce PIP from the bottom up. We will try to find the people who need the money and there will be winners and losers in that process. In particular, the PIP process is far more understanding of mental health issues. I do not think looking at absolute numbers undermines the principles of how you create the universal credit. It does not undermine our considerations of the principles of the universal credit but we need to understand the impact of PIP and the carers’ allowance in relation to it. We shall have that information in time and debate it in great depth. I am committing to providing those figures at the right time. It is not a trivial but a hard commitment. The timing has been produced under pressure from the Committee and I hope that it is accepted in the spirit with which it has been obtained.