Care Bill [HL]

Lord Lipsey Excerpts

Wednesday 16th October 2013 Lords Chamber

Moved by

[Lord Lipsey]

120: Clause 67, page 57, line 17, leave out from “person” to “in” in line 18 and insert “fraudulently or negligently misrepresents or fails to disclose any material fact that they might have reasonably been aware would have a bearing on expenditure incurred by the local authority”

--- Later in debate ---

[Lord Lipsey (Lab)]

My Lords, I hope that this can be a short, sharp debate because it is about a very clear matter of principle.

Clause 67(4) provides that councils can recover money paid out on claims for any benefit in Part 1 of the Bill which are made in error—and here are the operative words—“whether fraudulently or otherwise”. My amendment would substitute a longer form of words whereby councils can recover where a claim,

“fraudulently or negligently misrepresents or fails to disclose any material fact that they might have reasonably been aware would have a bearing on expenditure incurred by the local authority”.

That is designed to narrow the scope of the “otherwise” that allows councils to recover in all circumstances. In other words, as the Bill stands, someone who applies for a benefit who inadvertently errs in their application can be pursued to repay the full resulting cost to the council, including the cost of the council’s action, I think. My amendment preserves the recovery if the claim was fraudulent but otherwise allows it only if the old person was negligent. In a sentence, it protects the claimant who makes a slip.

I will give an example of what could happen under the Bill as it is worded. An old person applies for a deferred payment loan on their house so as not to have to sell it. Unfortunately, they make a slip in declaring their assets: they forget some bank account or other. If they had declared it, their assets would have exceeded the £23,250 limit, which the House discovered to its surprise now applies to anybody who wishes to apply for a loan; they cannot apply for a loan if they have more than £23,250. The local authority later finds out and demands its loan back; it perhaps forces the house to be sold to pay it back. I do not suggest that this is going to happen regularly or often but we should not allow the possibility that it should happen at all.

I raised this matter in Committee and subsequently discussed it, with the Minister’s encouragement, with his officials. My aim was to find a compromise that protected the old person who had made a mistake in applying for the benefit while enabling the local authority to go after somebody who was deliberately trying to get something they were not entitled to or who had behaved extremely stupidly and should have known better than to claim.

I thought we were making headway in those discussions but last week the Minister sent me a note refusing to change the Bill. I must say that this is wholly out of character for the noble Earl, Lord Howe, who is usually the most humane of men, and I beg him to think again. If he does not like my wording, that is fine; I am quite happy to consider any other wording that he and his officials may put forward that avoids the pitfalls I suggested. What I will not accept is anything short of an amendment to the Bill.

I know, because he said so in his note to me, that the Minister may claim that he can provide guidance which stops this sort of illegitimate recovery of a debt incurred through error. To that I say two things: first, a bird in the hand is worth two in the bush and I would rather change the Bill now than to rely on promised guidance, which we have not seen and could not later amend; secondly, it is not only the people the council would prosecute or seek to get their money back from that we need to worry about. A lot of old people are quite nervous about handling financial affairs—quite rightly, given the complexity of these affairs. They might be thinking of applying for a benefit but if they learn that, under a Bill passed by this Parliament, if they make a slip they can have their assets seized to repay it, many of them will simply decide not to apply at all.

I think I have a pretty thick skin but I was a bit surprised when I read in the newspapers this morning a Conservative spokesman quoted as saying that this was a politically motivated amendment. Just to set the record straight: it was not my idea to amend the Bill in this way. This amendment was put forward by Age UK, which sent a note to all noble Lords explaining why it believes it to be necessary. We all know Age UK: it is a splendid group working for old people. The noble Baroness, Lady Greengross, used to run its predecessor. A less political organisation than Age UK is hard to imagine, so I hope that the Minister will apologise for the inadvertent—I am sure—slur that has been cast on Age UK.

I should add that Age UK believes that the Bill may be in breach of Article 6 of the European Convention on Human Rights. In a House which earlier on displayed such expertise on the subject of the European Convention on Human Rights, I am certainly not going to express my own opinion on whether that view is right or wrong. Nothing could be more stupid than for us to pass this Bill in its present form and later on to find it challenged in the courts, and perhaps overturned.

My argument does not rely on the convention on human rights. It relies on what seems to me to be a simple fact, obvious to anybody who reads this clause in the Bill. This is not the kind of legislative provision that you would expect in a democracy. It is a provision which enables authorities here, in Britain, to punish the innocent and, in the process, to terrify people who might otherwise apply for benefits to which they are entitled. I beg to move.

--- Later in debate ---

[Lord Lipsey]

My Lords, I thank the Minister for that reply and I predict that in the handbook which all civil servants use to train themselves in their art, his reply will figure as an example of how best to argue an indefensible case, because that is what I think he has just done. “Resent” would be too strong a word, but the argument that by raising this matter I am creating a problem and raising the fears of old people is not plausible. This is what Governments do the whole time: they try to do something wicked, but when that is pointed out to them, they say, “Oh no, it is you who are causing the trouble because you are pointing out that it is wicked”. The fears are raised not by my speeches or interventions; they are raised by the words in the Bill to which the Minister has put his name.

The Minister also said that this power is all right because it is 60 years old. To that I have two things to say. If a power like this has been lurking around in legislation for 60 years, it is about time we took a little look at it, and I hope the noble Earl will start some such operation. Wherever that power exists now, this is a different case because here we are dealing with elderly people. As my noble friend Lady Bakewell so graphically pointed out, with the best will in the world, older people can make mistakes. Whether it applies to other social security legislation, I cannot say. It may do so, but I do not think it is appropriate to this legislation.

The Minister then rightly said that if a local authority goes to court, the court will not grant the order. But before the local authority goes to court, it will have to deliver a letter to the old lady saying that it is going to do so. What will be the impact of that? Is she going to say, “Oh, that is fine. The court will turn it down. I will see my solicitor or my son and get this defeated”. No, the old lady will be thrown into a panic as a result of what the local authority is doing. I agree totally with the Minister that most of the time, most local authorities act perfectly reasonably. That is not what is at issue here. What is at issue is whether on the face of primary legislation there should be the scope for the odd authority to act unreasonably and thereby cause terrible fear and distress to older people. That is what the noble Earl, I am sure inadvertently, is doing.

Finally, I turn to the most powerful of the Minister’s arguments. He said that this would be very unfair because people would get away with it and they would gain at the expense of others who are also claiming benefits. But I beg the Minister and the House to study my amendment. It does not say, “Well, if you fill in the form inattentively and get it totally wrong, you will get away with it”. That would come under the phrase in my amendment, “they might have reasonably been aware”. In most conceivable circumstances, my amendment would allow recovery in just the same way as the Government’s drafting, but it would do so without that frightful “or otherwise”. It is a sword of Damocles being held over the heads of many innocent older people, and they should be spared from that.

The Minister has made his speech and the House has heard both sides of the case. I think that it is time to test its opinion in the Division Lobbies.