Welfare Reform Bill

Baroness Lister of Burtersett Excerpts

Tuesday 14th February 2012 Lords Chamber

Moved by

[Baroness Lister of Burtersett]

As an amendment to Motion D, at end insert “but do propose Amendment 23B as an amendment in lieu”

23B: After Clause 53, insert the following new Clause—
“Condition relating to youth: review
In section 1 of the Welfare Reform Act 2007 (employment and support allowance) after subsection (3A) there is inserted—
“(3B) The Secretary of State shall conduct a review of the impact of the provisions of subsection (3A) on such persons as are affected by those provisions.
(3C) The review under subsection (3B) shall commence twelve months after subsection (3A) has come into force; and a report of the review shall be laid before both Houses of Parliament within three months of the review commencing.””

[Baroness Lister of Burtersett]

My Lords, I admit that this is not the amendment that I had wanted to move but I have been prevented from moving that one by the—and I hope that this is not unparliamentary language—sneaky amendment that the Government passed on the evening of 11 January, which ran contrary to the earlier decision made by your Lordships’ House to protect the ESA youth provision. This amendment simply calls for a report on the impact of its abolition so that the young people affected are not left completely in the lurch.

Noble Lords will recall that we are concerned here with the abolition of a provision which has been an accepted and uncontested part of social security legislation since 1975. It enables young people who have been disabled from birth or childhood to access contributory employment and support allowance without having paid the necessary contributions on the grounds that they cannot be expected to have paid them.

I shall not go over all the arguments that have already been made but I want to pick up one point that the Minister made—that young people who do not qualify for income-related ESA have independent means. I find it strange that the Government, who have such concern about so-called welfare dependency on the state, do not seem to understand that in the 21st century an adult who has to depend totally economically on another finds that demeaning. It is not right.

The abolition of the youth ESA provision was originally justified on the grounds of administrative simplification, as the noble Lord has said. That argument did not stand up well to scrutiny, so the Government shifted their ground and argued that its abolition was necessary to protect against the effects of a European Court of Justice decision in the case of Stewart, as the Minister has explained. This decision is dated 21 July 2011. The Grand Committee discussed the youth condition on 8 November—three and a half months later—yet the Minister did not mention it. If the implications of the decision were so significant, surely someone in the DWP would have noticed them during those three and a half months. The first that noble Lords heard of it was in January. Interestingly, in January the department was also rebuked by the UK Statistics Authority for rushing out figures on benefit tourism with insufficient regard to weaknesses in the data. The National Institute of Economic and Social Research argued that these same figures disproved ministerial claims about benefit tourism. I raise this only because I wonder whether the ESA youth condition has not become the victim of a moral panic in the DWP about the much exaggerated problem. That is not to say that I am defending benefit tourism, where it happens.

More importantly, I have received advice from Dr Charlotte O’Brien, a law lecturer at the University of York. She is an expert in this area and I am very grateful to her. She disputes the department’s interpretation of the implications of the Stewart case. In her view, the Government’s “claim that ‘we could end up paying this benefit, on a long-term unconditional basis, to more people who have never lived in the United Kingdom but who can simply demonstrate a link to it’; and the suggestion that the ruling makes ESA in youth much more widely available are not supported by either the rules on social security co-ordination or by the wording of the judgment”. I shall not wear the patience of your Lordships’ House by going into detail. I just wish to say that it is unlikely that in many such cases the UK will be the “competent state”—a necessary condition of entitlement. However, where it is, it is still open to the UK Government to apply a “real link test”, which would not be deemed to be arbitrary in the way that the residence test was in Stewart. When I put it to Dr O’Brien that it would appear that the Stewart judgment had been seized on as a pretext, she agreed, adding, “I think it is a very flimsy pretext”.

If, however, the department’s interpretation were correct, it might also raise questions about entitlement to DLA/PIP and attendance allowance. Can the Minister please give the House a firm assurance that there will be no attempt in future to abolish those payments using the same pretext?

Finally, I come to the question of money. The impact assessment for this measure did not include financial savings in its list of policy objectives, yet Ministers have subsequently used these savings as an argument to justify it. What savings are we talking about? The amendment overturned by the House of Commons would have cost a mere £17 million by 2015-16. That is a cumulative cost. It would be really helpful if the Minister could stick to annual costings, or are they so minimal as to be unquantifiable on an annual basis? Surely it is an abuse of financial privilege to slap it on an amendment, the cost of which falls easily within the normal margin of error.

I do not blame the Minister, but in both Houses Ministers have tried to justify the abolition of youth ESA as part of what they have called the Government’s “principled approach to reform”. I believe that this mean-minded little measure and the justifications put forward for it, together with the application of financial privilege and the manner in which the Government moved their own amendment on Report, are totally unprincipled. I beg to move.

--- Later in debate ---

[Lord Freud]

My Lords, I am always delighted to take the advice of someone who occupied my room in the department for so many years—although I think that there is a progression and that ignoring it early on does not mean that it will not come back. I will not go into this in too much detail. I am sure that the noble Baroness did not mean to say that I was making it up, because I was not.

[Baroness Lister of Burtersett]

Before the noble Lord moves off the point, will he give us the assurance I asked for that, whether or not this is a pretext this time, the argument will not be used to bring forward proposals to abolish attendance allowance, DLA or PIP on the grounds that it is the only way to deal with such cases?

[Lord Freud]

My Lords, that is an enormous question. In this context, I am in no position to give the undertaking. We will have to look very carefully at how we frame our benefits if we do not want them all to be very freely and widely used. That is all I am saying. How we will frame them in the years ahead I do not know. I have not started to think about it. Clearly, we are going through a huge exercise to introduce PIP and it is very unlikely that anything will reverse it for many years. I cannot answer the question because it is too big. However, these are real concerns.

I will go back to a narrower point. We want to modernise and simplify the welfare system. We want to avoid duplication of provision, and to redefine the basis of the contract between the individual and the state. We need to do that in advance of universal credit coming in. We want to place claimants on the same basis as everyone else. All those who do not qualify for contributory benefits will qualify for income-related benefits. The effect in practice will be a streamlined system for these youngsters to receive passported benefits.

The amendment does not work, but I take the point. We will monitor this very closely and keep the outside world, including the Chamber, informed.

[Baroness Lister of Burtersett]

My Lords, I am grateful, first, to my noble friend Lady Hayter of Kentish Town for her very helpful and supportive speech. I also thank the Minister. Of course he is right that the amendment in its current form is not appropriate. As I said, it is not the amendment that I wanted to table. However, it has done what I hoped it would do. It has elicited from the Minister a commitment to monitoring. That is very welcome.

The Minister has acknowledged that monitoring cannot be simply statistical. I hope that it will pay particular attention to the nine out of 10 people who will qualify for income-related ESA. We will want to know how much money they will get relative to what they would have received under a contributory scheme. As my noble friend said, the income assessment suggested that there would be an average loss of £25 per week for some young and vulnerable people. That is a lot of money for them. We will want to know about the situation of the one in 10 who will not qualify. Will it be because of the great inheritance they have received? Or will it be the case, as I suspect, that their parents have scrimped and saved to ensure that when they die, their son or daughter has a financial cushion—as a result of which they could lose all entitlement to benefits. I cannot believe that the House would want that.

I hope that the monitoring will look at that and will include research to find out how young people feel when they have a partner and no entitlement and so come to depend economically on their partner, on whom they may already depend for physical assistance. Their dependence will become total. I hope that the Minister will discuss with researchers and others—perhaps including Members of this House and the other place—the appropriate monitoring that will take place. I very much welcome what he said about monitoring, and the fact that he will report to the House and to the other place. The time period of three months is too short and we do not want just a one-off report. I hope that there will be a mechanism for enabling us, on a regular basis, to hear what is happening to this group of young people. As my noble friend said, they are very vulnerable.

One thing I found worrying in the Minister's reply was that he was not able to give the assurance that I asked for about the other benefits. I thought that I was asking for a simple thing. It makes me worry about whether there is a plan—I will put on the record that the noble Lord is shaking his head to indicate that there is no such plan—to abolish these benefits. However, I would have felt much happier if we had had a clear assurance that it simply would not happen and that the Government's interpretation of EU law would not be used in that way.

It is not with a heavy heart that I withdraw the amendment because I completely accept, as the Minister said, that it is not terribly good. However, it is with a heavy heart that I feel that we in this House and the other place have let down young disabled people who look to Parliament to preserve their independent income. I feel disappointed that we have not been able to protect that group of people. Having said that, I beg leave to withdraw the Motion.

Motion D1, as an amendment to Motion D, withdrawn.