Immigration and Social Security Co-ordination (EU Withdrawal) Bill Debate

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Department: Home Office

Immigration and Social Security Co-ordination (EU Withdrawal) Bill

Baroness Stedman-Scott Excerpts
If Ministers want delegated powers on this scale, the very least they need to do is to be clear on what they intend to do with them. Social security co-ordination affects a great many people, and Parliament deserves more clarity and control than the Bill currently affords us. I hope the Minister can answer these questions well.
Baroness Stedman-Scott Portrait The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Stedman-Scott) (Con)
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My Lords, I am grateful to those who have spoken to this group of amendments. I also thank Ministers from the Home Office for their stewardship of this clause to date.

The EU social security co-ordination regulations operate in the context of the EU’s free movement rules. I will refer to these as the SSC regulations. They set out which member state is responsible for the payment of social security benefits, and require the export of some benefits and the aggregation of social security contributions when claiming benefits and pensions. The rules require equal treatment for citizens across the EU, and they also ensure that individuals pay social security contributions in only one member state at a time.

The Government have repeatedly and transparently set out that as we end free movement, the EU social security co-ordination rules will change to reflect the arrangements we have with countries outside the EU—for example, in relation to the export of UK benefits. It is right that the UK be able to set and negotiate its own rules, in line with well-established UK policy in this area, now we have left the EU and as we prepare for the end of the transition period.

Clause 5(1) of the Bill duly provides the power for an appropriate authority to modify the retained SSC regulations specified in subsection (2). Clause 6 specifies that the power to modify includes the power to amend, revoke or repeal. Subsections (3) and (4) of Clause 5 ensure that supporting incidental or consequential changes made under the power can be appropriately reflected in domestic and retained legislation—for example, to address inoperabilities or inconsistencies which may arise from the modification of the retained SSC regulations. This provides Ministers with the power to ensure the continued operation of domestic social security legislation which refers to, or is related to, the retained SSC regulations.

Subsections (5) and (6) disapply EU-derived rights to ensure that there are no unintended interactions between areas of EU law and new policies, for those not covered by the withdrawal agreement. Subsection (7) defines “appropriate authority” as

“(a) the Secretary of State or the Treasury, (b) a Northern Ireland department, or (c) a Minister of the Crown acting jointly with a Northern Ireland department.”

This provision currently confers on a Northern Ireland department the power to make changes in this area so far as they relate to matters within its devolved competence.

Schedule 2 sets out the scope of the power as it relates to a Northern Irish department, providing details on the powers used in relation to devolved competence, joint use with Ministers of the Crown and consultation with the Secretary of State where that is normally required. The Northern Irish Minister for Communities confirmed that a legislative consent Motion will be requested from the Northern Ireland Assembly in respect of Clause 5. My officials are working closely with the Northern Ireland Executive, given the need to bring the LCM discussions to a conclusion—one way or another—by Report.

Schedule 3 provides further detail on the form that regulations will take under the clause. The schedule also provides that any regulations made through the use of the power are subject to the draft affirmative procedure. The noble Baronesses, Lady Sherlock and Lady Ludford, raised issues around the Delegated Powers and Regulatory Reform Committee’s criticism of the breadth of and justification for the powers. I have noted the recommendations in the DPRRC’s report of 25 August and have heard the House’s views.

The power enables the Government to implement policy changes in this specific area, for example, to stop the export to the EU of a UK benefit where that benefit is currently required to be exported under these EU rules. The Government’s position is that the powers in other legislation do not provide for this. That is the purpose of this power; it cannot be used to initiate policy changes where these do not arise from the modification of the specified retained SSC regulations. The understanding of the noble Baroness, Lady Sherlock, is correct in that regard.

I note that the DPRRC’s recommendation that this clause be removed is unchanged since its report on the previous iteration of the Bill. While the clause is broadly unchanged, the context is very different. First—as acknowledged in that report—we now have a withdrawal agreement with the EU, and nothing in Clause 5 enables the Government to alter the rights guaranteed under that withdrawal agreement. When discussing Clause 5, we are therefore talking about those who move between the UK and the EU once the transition period has ended and not about any current recipients of UK benefits living in the EU while they continue to live there. There is no time now for a more detailed explanation of what it means to be covered by the withdrawal agreement, but the Government will publish detailed guidance on this question.

Secondly, on 27 February—before the introduction of this Bill—the Government published their future social security co-ordination policy, confirming that they would seek an agreement with the EU in this area, covering co-ordination on the state pension and social security contributions.

Thirdly, on 19 May, before Committee in the other House, the Government published, in full, their proposed legal text for negotiations with the EU in this area. To support the scrutiny of the clause in Committee in this House, we shared—on 4 September—a draft of the regulations illustrating the approach the Government intend to take under Clause 5 in a negotiated outcome with the EU, which remains our objective.

We have set out that the retained SSC regulations would be repealed were they no longer required. The intended policy consequence of this approach is that where provision is not made under a future UK-EU agreement on social security co-ordination—for example, in relation to the export of a particular benefit—that provision would cease. This point is critical: the retained SSC regulations are designed to operate on the basis of reciprocity with the EU and its member states. The Government are seeking a new reciprocal social security agreement with the EU—an agreement similar to those we have with key trading partners outside the EU, where the UK can agree the limits of what we co-ordinate, in line with our national interest. Those negotiations are ongoing.

We need this power to provide the essential legislative framework for the Government to deliver future policy changes from the end of the transition period in this specific area. This needs to be done in the window between the conclusion of negotiations and the end of the transition period and in response to the outcome of those negotiations. The Government’s approach has to be viewed in that context.

The noble Lord, Lord Alton, and the noble Baroness, Lady Ludford, talked about avoiding scrutiny. Far from seeking to avoid scrutiny, this approach gives Parliament the opportunity to scrutinise the Government’s position during the Clause 5 discussions. As Clause 5 provides the power to make draft affirmative regulations, Parliament will have the opportunity for further debates on the affirmative regulations, based on the outcome of the negotiations. We have consulted the Social Security Advisory Committee on our draft regulations and will continue to engage with it as the regulations are finalised.

I will come back to more detailed points on the scope of this power on the next group of amendments, but my arguments also apply in respect of Amendment 84 in this grouping. In isolation, Amendment 84 unnecessarily inserts the word “only”.

The noble Baroness, Lady Sherlock, spoke about Amendment 91, which seeks to time-limit the regulation-making powers under Clause 5 to within one year of the end of the transition period. The amendment would prevent the Government making further changes to the retained SSC regulations beyond 31 December 2021 without new primary legislation. The Government can already make and revise co-ordination arrangements with non-EU countries without a time limit, using secondary delegated legislation under the Social Security Administration Act 1992.

To time-limit the Clause 5 power would require the Government to use primary legislation to make even minor changes to the retained SSC regulations, to the extent that those remained on the statute book once the power had expired, which would not be a good use of parliamentary time. Unlike the position with non-EU countries, all regulations made under Clause 5 are subject to the draft affirmative procedure and require a debate in each House before they can become law. By committing to that, the Government are providing reassurance to Parliament that future use of this power will be open to scrutiny.

On Amendment 85, the noble Baroness said that she sought to remove the power to distinguish between recipients of state pensions and benefits on the basis of nationality or residence in a particular member state. The effect of the amendment would be to restrict the Government’s ability to make

“different provision for different categories of person to whom they apply”,

for example, on the basis of nationality, immigration status or date of arrival. The social security co-ordination agreement that the UK seeks with the EU is a nationality-blind agreement.

However, there is a possibility of a non-negotiated outcome. The wording in this clause is largely standard wording in social security legislation. The wording makes it clear that there might be different provision for different categories of person, and this includes immigration status or nationality. Making different provision for different categories of person is not new; examples can be found in bilateral agreements the UK has with other countries. For example, the UK has already signed a social security agreement with Ireland, which applies to UK and Irish nationals and their family members in the UK and Ireland.

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Baroness Stedman-Scott Portrait Baroness Stedman-Scott (Con)
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My Lords, I thank the noble Baronesses, Lady Hamwee and Lady Ludford, for tabling Amendments 86 to 90 and 92. I sincerely apologise for any effort on my part that allowed the noble Baroness, Lady Hamwee, to get lost in my explanation. That was never the intention. I can confirm to all noble Lords that we will write, as requested. I hope it is clear that, as in the run-up to Committee stage, our door is open for further meetings for clarification.

These amendments seek to probe and limit the consequential powers at subsections (3), (4) and (5) of Clause 5, which are intended to provide the flexibility needed to fully implement, across the statute book, policy changes arising from the outcome of negotiations with the EU. In general, the provisions at subsections (3) and (4) provide the Government with the ability to give full effect across the statute book to policy changes arising from the modification of the retained SSC regulations listed at subsection (2), based on the outcome of negotiations with the EU in this area.

The purpose of these powers will be to ensure that there are no inconsistencies or gaps in provision between domestic social security legislation and retained SSC regulations following modification of the regulations at subsection (2). Such inconsistencies could potentially hamper the operation of domestic social security law where there are references to the regulations at subsection (2). Subsection (4) is not a “new power”, as the noble Baroness suggests. Nothing in subsections (3) or (4) enables the Government to do anything that does not arise as a result of changes to the SSC regulations. In particular, changes made under subsection (4) are limited by Clause 5(3)(c).

Wording used in Clause 5(3)(a), (b) and (d), for example, in relation to the use of discretion, as well as making different provision for different categories and purposes, reflects largely common wording in social security and other legislation which ensures that the regulations made under Clause 5(1) can appropriately reflect the different categories and statuses of those affected. I have previously mentioned the withdrawal agreement and the agreement that we have with Ireland on social security. Both are examples of where, for persons in scope of those agreements, we have already made provision for different categories of persons and for different purposes, and may need to do so again under regulations made under Clause 5 through subsection (3).

Subsection (4) simply ensures that any changes directly related to the retained SSC regulations can be fully implemented—for example, where supplementary or transitory provision is required in other legislation arising from the changes to the SSC regulations. The terms used at subsection (3)(c) allow for the making of provisions that arise from the changes to retained SSC regulations and for temporary or time-limited provisions that assist in the implementation of any changes brought about by the outcome of negotiations with the EU, if appropriate. The removal of subsection (4) could result in incomplete or incoherent amendments to domestic legislation or retained EU law not mentioned in subsection (2), potentially affecting the functioning of domestic social security law and a future agreement in this area.

We have shared with the Committee an illustrative draft statutory instrument that would be made under Clause 5. The draft SI includes a section which makes consequential and supplementary amendments of different types and purposes that arise elsewhere in the statute book as a result of the modification of retained SSC regulations. It is important that the Government have the power to make such consequential changes to avoid inconsistencies, gaps and inoperabilities across the statute book.

In my previous comments I gave an example of where the Government could not use this power to stop the export of the state pension. The state pension is payable worldwide under domestic legislation. Therefore, this power could not be used to such effect. With regard to Amendment 90, subsections (5) and (6) simply ensure that there are no unintended interactions between areas of EU law and new policies for those not covered by the withdrawal agreement. We have been very clear that there will be new policies in this area, which will mean that there will be a change in social security co-ordination entitlements for future cohorts of claimants.

These amendments would restrict the Government’s ability to reflect changes and to make appropriate changes across the statute book to ensure the full implementation of any outcome of negotiations with the EU. I think I have confirmed to the noble Baroness, Lady Sherlock, that I will respond to her in writing. To the noble Baroness, Lady Hamwee, on lack of scrutiny, I have set out under the previous group the specific consequences that justify this approach. I say to her also that, on Amendment 89 on the use of discretion, reference to discretion is standard wording in social security legislation and can be found in many Acts of Parliament. On the issue of why Amendment 85 is unnecessary, I will happily write to the noble Baroness, Lady Hamwee.

I hope I have addressed noble Lords’ concerns, and I ask the noble Baroness to withdraw her amendment for the reasons outlined.

Baroness Hamwee Portrait Baroness Hamwee (LD) [V]
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My Lords, it is not the Minister’s fault that I was confused in the previous group. I certainly was not accusing her of anything—it is entirely my own fault.

I am interested to hear that Clause 5(3)(d) is standard in social security legislation. It is not something that I am accustomed to in Home Office legislation—this Bill brings the two together—but I may be wrong in that and might not have noticed it before.

The Government have got themselves into a pretty tight timetable on this. That is why they want scope to make changes. I do not doubt the noble Baroness’s intentions; she sounded very reassuring. But it is not about being reassuring now, it is about what is possible under the very wide powers, as I and other noble Lords have been pointing out. Clearly, at this moment it is appropriate that I should beg leave to withdraw the amendment, so that is what I will do. However, I say to the noble Baroness—and it is no accusation—that I have not been assured. I beg leave to withdraw the amendment.