Northern Ireland (Welfare Reform) Bill

Mark Durkan Excerpts

Monday 23rd November 2015 Commons Chamber

[Mark Durkan]

I beg to move amendment 1, page 1,  line 3, at beginning insert

‘Subject to subsection (3A) below,’.

This amendment provides limitations on the Secretary of State’s power to recommend that an Order in Council be made affecting social security and child support maintenance, and employment and training for employment, in Northern Ireland.

[The Temporary Chair (Sir Alan Meale)]

With this it will be convenient to discuss the following:

Amendment 2, page 1, line 18, at end insert—

‘(3A) An Order in Council under subsection (1) or any order or regulations under subsection (2) may not, in particular—

(a) prescribe a period of more than 3 days for which a universal credit claim does not arise;

(b) provide for any sanction period of more than 26 weeks;

(c) amend section 129A (appropriate maximum housing benefit) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992;

(d) provide for a benefit cap;

(e) make any limit on the number of children for which any child benefit, child tax credit or child element of universal credit can be claimed;

(f) specify or determine the level or form of sanctions;

(g) make any provision or have any effect which would provide a claimant with less than 15 days’ notice in which to provide a good reason why sanctions should not be applied in that claimant’s case.’.

This amendment limits the changes that the Secretary of State may make through an Order in Council as regards sanctions, a benefit cap, entitlement to child benefit and limitations on housing benefit, leaving these issues to be dealt with under the existing devolved arrangements.

Amendment 3, page 2, line 6, at end insert

‘and the Northern Ireland Assembly.

Provided that the text of the statutory instrument containing the Order shall be laid before the Northern Ireland Assembly seven days before approval can be given.’.

This amendment requires that the Northern Ireland Assembly approves a draft of any Order in Council made under this bill before it is made, and that sufficient time is given for due consideration.

Clause stand part.

New clause 1—Duty to report—

‘(1) In respect of an Order in Council under section 1(1) or any order or regulations under section 1(2) the Secretary of State will, within twelve months, publish a report of its operation which must include—

(a) comparative data and information on numbers of claimants and, where relevant, dependants and the relative value of benefits, allowances, payments or credits so as to reflect any difference in provision before and after the operation of the order or regulation;

(b) assessment of any impact in respect of section 75 of the Northern Ireland Act 1998; and

(c) reflection of observations from independent welfare advice service providers.

(2) In publishing any report under subsection (1), the Secretary of State must—

(a) lay the report before the House of Commons;

(b) send the report to the Speaker of the Northern Ireland Assembly; and

(c) be available to appear before a committee of the Northern Ireland Assembly to address, or answer on, the report.’

This amendment confers a responsibility on the Secretary of State to report on the first twelve months of operations and impacts on any orders made under this Act. It would ensure the Secretary of State had to lay the report before the House of Commons, send the report to the Speaker of the Northern Ireland Assembly and appear before a Northern Ireland Assembly committee.

[Mark Durkan]

It is a pleasure to be here under your chairmanship, Sir Alan, even if it is not a pleasure to be dealing with this sort of fast-track, microwave legislation. It is unfortunate that, under the terms of the allocation of time motion, although my hon. Friends the Members for Belfast South (Dr McDonnell) and for South Down (Ms Ritchie) and I have been able to table these amendment and will be able to speak to them, we will not be able to vote on them. We tabled amendments 1, 2 and 3 and new clause 1 in this group and another amendment that will be discussed along with clause 3 stand part in a later group. I will stay off that for now.

The Second Reading debate went a lot wider than the content of the Bill. In Committee, we will look at the Bill as we debate the clauses and amendments. I will introduce our amendments by following up on what we said on Second Reading. Our amendments would create a different delineation and more definition in respect of what functions will be exercised, following the legislative consent motion and the passage of the Bill, by the Secretary of State and what functions will remain to be exercised by a devolved Minister working through the devolved Assembly. For us, that seems to be a more sensible way to do things.

Our amendments relate to issues that Members of this House from different parties in Northern Ireland and, indeed, from beyond Northern Ireland have expressed concerns about and that a wide range of people in the Northern Ireland Assembly have expressed concerns about. Therefore, we do not think it would do any injury to the course that the Secretary of State says will be open after the passage of the Bill or to the path forward on welfare reform that the DUP has talked about for these amendment to be considered.

We are told that it is entirely compatible for the same powers to be held concurrently in the Assembly and in Westminster. It must be equally compatible if we make sure that there is agreement and understanding about who will take the lead in respect of each particular function, given the sensitivities and issues involved. If the powers that are taken by the Secretary of State are about satisfying the requirements of the Treasury and others in respect of levying fines and penalties and controlling the rules and rates for benefits, some of the other matters, such as the flexibility of administration and sanctions, could safely and properly be left with the devolved Assembly and the devolved Minister. That is the purpose of amendments 1, 2 and 3. I will address new clause 1 separately.

Amendment 1 would provide some exceptions to the powers that will come to the Secretary of State. Clause 1(3) provides a sweeping range of powers for the Secretary of State in respect of Orders in Council or subsequent regulations, and the amendment would introduce a new subsection to qualify those powers. Amendment 2 would restrict the exercise of powers that would come to the Secretary of State, so that direct rule powers could not be used to

“prescribe a period of more than 3 days for which a universal credit claim does not arise”—

again, that picks up on an issue that has been voiced by many people, not just those in Northern Ireland but people coping with benefits in Britain.

Under amendment 2, the Secretary of State would not have power to

“provide for any sanction period of more than 26 weeks”,

or to amend housing benefit under the Social Security Contributions and Benefits (Northern Ireland) Act 1992. The Secretary of State would also not be allowed to

“provide for a benefit cap”,

and as the Minister told us when winding up the Second Reading debate, changes to the lower rate of the benefit cap under the current Welfare Reform and Work Bill will come in a subsequent Order in Council following this Bill. Many hon. Members—including DUP Members —expressed concern about the lowering of that benefit cap and voted to amend or oppose it, so I would have thought it entirely consistent for them to support an amendment to limit the power of the Secretary of State in that regard.

[Sammy Wilson]

The hon. Gentleman has gone through a list of the changes he wishes to see. His colleague, the hon. Member for Belfast South (Dr McDonnell), said that he believes that these changes will be cost-neutral. Will he explain which of his amendments will cost money to the Executive, and which will bring more money in so that they balance out?

[Mark Durkan]

In response to my hon. Friend the Member for South Down, I said that some of these amendments are cost-neutral. That was what the Minister told us at the time, and some of those points can be repeated for this exception. The Minister in the Assembly said that some of these proposals were cost-neutral. However, some of them will not be cost-neutral, and I make no pretence in that regard.

Proposed new subsection 3A would deny the Secretary of State the right to

“make any limit on the number of children for which any child benefit, child tax credit or child element of universal credit can be claimed”.

Many people have opposed the two-child rule, and the amendment would mean that we do not hand that rule to the Tory Secretary of State when many of us are opposed to it.

[Tom Elliott]

To follow up the question from the hon. Member for East Antrim (Sammy Wilson), if some of the amendments are not cost-neutral, where does the hon. Gentleman think the money will come from? Will it come from the block grant and the £585 million currently in place, or from Her Majesty’s Government?

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[Mark Durkan]

Those matters will have to be properly negotiated and determined. We have also been told about a possible revision by the Chancellor on his approach to some of these matters—in fairness, it is not only Opposition Members who have raised questions about aspects of the two-child rule and some of the other changes. This is about ensuring that we do not unduly hand more powers to the Secretary of State than the Assembly might want. We have been told by the Minister that although the Secretary of State will have these powers, the Assembly will have the same powers and can move on these matters should it wish. The question about whether to make provision for these issues or whether to do things differently will arise for the Assembly in any case.

Proposed new subsection 3A(f) would deny the Secretary of State the power to specify or determine the level or form of sanctions, and paragraph (g) would disallow the power for the Secretary of State to

“make any provision or have any effect which would provide a claimant with less than 15 days’ notice in which to provide a good reason why sanctions should not be applied in that claimant’s case.”

Those two provisions pick up on concerns aired in England by various welfare advice services, Churches and charities on the basis of their experience. Those concerns have, in turn, been reflected in Northern Ireland.

One thing puzzles people in Northern Ireland when they ask, “How did they come to this deal?” People might understand that parties have yielded from their previous position because of budget exigencies—the penalties and fines squeezing tighter—and that maybe they have said, “Well, we cannot hold out on the position of trying to protect everybody on all benefits.” We never took that position. We thought Sinn Féin had taken an impossible stand with the promise to protect all benefits for all times. But people want to know why it changed its position. It is one thing to move in relation to benefit rules and annually managed expenditure that then flows to Northern Ireland for the social security agency to administer benefits to people, but why, if there were those sorts of budgetary reasons for shifting, did it have to move on the sanctions regime as well?

A very sensible course could have been to differentiate between power over the sanctions regime and the other powers. After all, we have been told by some hon. Members on Second Reading that the first Order in Council under the direct rule powers will contain a differential on sanctions arrangements between Northern Ireland and Great Britain, even though another DUP Member told us that under the power the sanction arrangements would have to be the same and that we could not differentiate. We have been told there is a differentiation, but if the direct rule power will be differentiated surely it would be better to say that decisions on the level and form of sanctions, and what mitigations might be brought in on the application of sanctions, should remain a devolved matter. After all, it will still be devolved civil servants taking those decisions, engaging with claimants and talking to them about these sensitive matters. We therefore tabled amendment 2 to qualify the Secretary of State’s powers.

When one recalls all the fundamental objections to welfare reform and Tory cuts, and the rhetoric used—for instance by Sinn Féin—most of it was reserved for the Tory sanctions and preventing them from being imposed. Sinn Féin, like others, pointed to evidence on the number of people who have died while enduring benefit sanctions. Questions have been raised about inquests and other reports. It therefore seems strange that there was no apparent effort on the part of Sinn Féin, or anybody else negotiating the deal, to differentiate between the power on sanctions and the actual determination on benefit rates and rules. If the skin in the game for the Treasury is meant to be that it wants to know that welfare spending in Northern Ireland is roughly on a par or in line with Great Britain after the Welfare Reform and Work Bill, it really did not need to go the whole way of having direct rule sanctions. A better deal could have been struck.

Amendment 3 provides that the Assembly should be notified of any Orders in Council or regulations created by the Bill—we are told they will last for only 13 months —and that there should be Assembly approval of any draft order made under the Bill. It’s funny: lots of hon. Members have said that we should pass the Bill unthinkingly, unquestioningly and without amendments because the Assembly passed a legislative consent motion, yet those of us who have tabled amendments are saying we want the Assembly to have the power of legislative consent so that these issues can be better scrutinised and the interests and rights of the Assembly’s constituents can be voiced.

--- Later in debate ---

[Mr Wallace]

It is a pleasure to serve under your chairmanship, Sir Alan.

The first two amendments will limit the changes that can be made through an Order in Council regarding certain areas such as sanctions, the benefit cap, entitlement to child benefits, and housing benefit. Amendment 3

“requires that the Northern Ireland Assembly approves a draft of any Order in Council made under this bill before it is made, and that sufficient time is given for due consideration.”

The purpose of the new clause is to place a responsibility on the Secretary of State to report on the impact of the first 12 months of any orders made under the Bill. It would require the Secretary of State to lay the report before the House of Commons, send it to the Speaker of the Assembly, and appear before an Assembly committee.

It is important to emphasise at the outset that the Bill in its present form has received the legislative consent of the Northern Ireland Assembly, which was delivered last week by an overwhelming majority of 70 votes to 22. We intend to resist amendments on that basis. I am sure that Members will join me in not wishing to undermine the consent that the devolved Administration have given the Bill by subsequently amending it.

In relation to amendments 1 and 2, it should be borne in mind that the Welfare Reform (Northern Ireland) Order 2015, which will follow the Bill, was also explicitly included in the Assembly motion that was debated and voted on last week. The agreement that was reached last week makes it clear that the Government will legislate to enable welfare reform to be implemented along the lines of the Assembly’s 2012 Welfare Reform Bill, which failed to pass in May. For that reason, the welfare reform order is based largely on this Bill.

Furthermore, the changes proposed by these amendments go beyond what was included in the Assembly’s Welfare Reform Bill. They do not therefore have the consent of the Assembly. If we were to accept them, Westminster would be legislating, in effect, without the Assembly’s consent. I advise the hon. Member for Foyle (Mark Durkan) that his concerns are best taken forward in the Northern Ireland Assembly. The Assembly retains legislative competence over welfare and therefore there is a degree of flexibility in how the Northern Ireland welfare system operates. I am sure that the SDLP will continue to argue forcefully for its position in the Assembly, but given that the motion passed already referred explicitly to the Welfare Reform (Northern Ireland) Order 2015 and the fact that changes proposed by this amendment can be made by the Assembly, the amendment is simply not needed.

Turning to the third amendment, it is worth remembering that it took almost three years for the Assembly’s Welfare Reform Bill to pass through its various legislative stages in the Assembly, until it finally fell in May of this year. There is an expectation on the part of those parties that have signed up to the fresh start that welfare reform will be implemented as quickly as possible. That is why the Assembly granted its legislative consent to this approach to address welfare reform the day following the agreement. Therefore, it is unnecessary to lay this order before the Assembly for seven days. To do so would only unduly delay further the implementation of welfare reform. It would no doubt leave the majority of MLAs scratching their heads and asking, “Why are we being asked to give our approval to an order that we have already approved?”

I will consider clause 1 in more detail. Clause 1 allows the Secretary of State to make provision for social security, child maintenance and arrangements for employment in Northern Ireland by Order in Council. This clause provides the vehicle for the Government to deliver welfare reform in Northern Ireland. It allows for an Order in Council made under this power to put in place a framework that will be supplemented by detailed policy to be set out in regulations by the Secretary of State or the Northern Ireland Department for Social Development. The clause provides that an Order in Council may make provision for further delegated legislation to be made by either the Secretary of State or the relevant Northern Ireland Department, allowing for detailed implementation to be carried out either in Westminster or in Stormont.

The clause allows for considerable flexibility in the drafting of the Order in Council, as this is a power that may be used on more than one occasion for slightly differing purposes, to implement possible future welfare reforms that need to be made before December 2016, for example. Finally, the clause provides that an Order in Council made under these provisions is subject to the affirmative resolution procedure.

Turning to new clause 1, I agree that it is important that the impact of welfare reform is fully understood in Northern Ireland. That is why I am pleased to see that the Northern Ireland Department for Social Development is committed to reviewing the operation of the Welfare Reform (Northern Ireland) Order that will follow this Bill. This is surely preferable to placing a commitment on the Secretary of State to report on the operation of an Order in Council made under clause 1(2) of this Bill. The Department for Social Development is better placed to understand Northern Ireland’s unique circumstances and to assess the impact of welfare reform there.

It is also worth remembering that we are legislating as part of the agreement reached last week. I am concerned that placing an obligation on the Secretary of State to report overlooks this fact, and gives the impression that welfare in Northern Ireland is no longer devolved. We are not taking back welfare. The Department for Social Development remains responsible for implementing the welfare reforms.

I ask the hon. Member for Foyle to withdraw the amendments, and I beg to move that clause 1 stand part of the Bill.

[Mark Durkan]

The Minister implied that the amendment would affect just one Order in Council—the one that is in draft at the moment—but of course it would apply to various Orders in Council. He identified the problem that, having passed a legislative consent motion, the Assembly would wonder why the matter had come back to it.

We are used in this House to dealing with different stages of legislation and dealing with different decisions. There is no reason why there should not be more scrutiny.

On the Minister’s argument about the legislative consent question—that these amendments would breach the legislative consent motion because that motion does not address amendments—I make the point that legislative consent motions can be retrospective. After all, the legislative consent motion in the Assembly last week was about retrospectively endorsing the welfare clauses of the 2015 Welfare Reform and Work Bill as originally introduced, even though one of the parties that voted for that in the Assembly had voted against those provisions in this House. So I do not believe that those arguments stand up.

Similarly, we believe that there is value in the production of a report, not just for now but to provide clarity in the future. The consequences of this legislation could otherwise end up being argued about for many years. Arguments could arise, for example, about the downstream effects of direct rule decisions and of devolved decisions. We still have an interest in the reporting implications of new clause 1, so we would like to retain the option to return to the new clause later. To facilitate that, and to allow discussion of the other clauses, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1 accordingly ordered to stand part of the Bill.

Clause 2

Section 1: supplementary provision

Question proposed, That the clause stand part of the Bill.

[Mr Wallace]

Clause 2 provides that Orders in Council made under the power in the Bill are to be treated as Acts of the Northern Ireland Assembly. That will help to ensure that any order forms a sustainable part of the Northern Ireland legal framework. For technical reasons, an exception is made for the purpose of section 6 of the Northern Ireland Act 1998.

Question put and agreed to.

Clause 2 accordingly ordered to stand part of the Bill.



Clause 3

Extent, commencement, sunset and short title

[Mark Durkan]

I beg to move amendment 4, page 2,  line 35, leave out “31 December 2016” and insert “1 June 2016”.

This amendment seeks to bring forward the end date for the Secretary of State’s decision making powers to take account of the fact that there will be a new assembly and a new devolved department from May 2016.

[The Temporary Chair (Sir Alan Meale)]

With this it will be convenient to discuss clause 3 stand part.

[Mark Durkan]

Amendment 4 stands in the names of my hon. Friends the Members for South Down (Ms Ritchie) and for Belfast South (Dr McDonnell) and I. It relates to the sunset provision. The Bill provides that the power that is to come to the Secretary of State, while apparently not leaving the Assembly, will last until the end of 2016. As my hon. Friend the Member for South Down has said, the Assembly will have a new mandate from next May. There could be new Ministers and possibly new departmental structures as well, if the fresh start programme and previous decisions from Stormont House are followed.

The excuse is being made about the exigencies of the requirement to move on welfare reform to break the supposed deadlock between welfare reform, the budget and the implementation of other measures. It is said that that all has to be done now. We might be told that there will be an Order in Council to transpose the 2012 Act’s provisions into Northern Ireland legislation first, and that there will be a subsequent Order in Council to deal with the current Welfare Reform and Work Bill’s provisions. There could also be supplementary regulations after that. There is no reason, however, for the powers to stay here until the end of 2016.

The shadow Secretary of State, the hon. Member for Gedling (Vernon Coaker), asked earlier why that date had been chosen. The most that the Minister could tell him was that it was what the parties had asked for. Two of the parties might have asked for it, but the rest of us did not, because we were not privy to the selection of that date. It therefore seems sensible to allow a newly created Department with its new Minister, and the Assembly with its new mandate, to take the full flush of powers that they should have, without anyone having to look over their shoulder to see what the Secretary of State is doing. It would be very good for that new Minister to be able to say that they will be exercising full responsibility and for the new committee in the new Assembly to have its full remit in terms of full legislative competence. That is why we have tabled a proposal to bring forward the date of the sunset clause.

We also seek to give people better assurance: if Ministers are assuring us that this is not intended to create direct rule for the long term or indefinitely, and that it is a temporary measure, we should make it even more definitely temporary. We should also make the timetable of that temporary arrangement more compatible with what is being provided on the Assembly’s own electoral cycle and calendar. That is the point of our proposal.

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[Mr Wallace]

Let me just respond to the points made by the hon. Member for Foyle (Mark Durkan) about the sunset clause. I can confirm that it refers to the powers being taken in the Bill, not the measures passed under the Secretary of State or via those powers. The December 2016 date was chosen because the aim is to get this welfare reform through, get the Assembly back up and running, and get Stormont back to running on full engines. The idea that we should risk that by picking a date that will not give us enough time not only to pass the legislation, but to implement it is crazy. Missing the deadline by a couple of months or weeks would put at risk all the hard work that has been done over the past few months and years. December 2016 is viewed as the best timetable for achieving the implementation of both the 2012 Act and the Welfare Reform and Work Bill, which is currently going through Parliament.

Clause 3 provides that the Act extends to England and Wales, Scotland and Northern Ireland. This is to allow for any subsequent and consequent amendments that may be required to legislation that has a UK-wide extent. The Bill has practical application only in Northern Ireland, as it is concerned only with welfare in Northern Ireland. The measure also allows the Act to come into force on the day that it is passed to ensure that the subsequent Order in Council can be quickly laid in Parliament. The most substantial element of the clause is the sunset provision, which sets out that no Order in Council can be made after 31 December 2016. I request that the hon. Gentleman withdraw his amendment and that clause 3 stands part of the Bill.

[Mark Durkan]

I indicated in response to the debate on the previous set of amendments that, if we were to have any kind of sample Division in relation to these amendments, our main interest would be in putting new clause 1 to a vote. I note what the Minister has said. I do not accept his arguments, and make the point that the sensible time for the Assembly to take the powers is when it is a few weeks into a new mandate. I hope, with all the optimism and confidence that has been expressed, that the Assembly will be in good and sufficient order when it takes its new mandate, with its new departmental structures and with its new arrangements for bringing forward a programme for government. It would seem to be a more sensible timetable, but we will not take the time of the House now by pressing for a Division. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 3 accordingly ordered to stand part of the Bill.

New Clause 1

Duty to report

(1) In respect of an Order in Council under section 1(1) or any order or regulations under section 1(2) the Secretary of State will, within twelve months, publish a report of its operation which must include—

(a) comparative data and information on numbers of claimants and, where relevant, dependants and the relative value of benefits, allowances, payments or credits so as to reflect any difference in provision before and after the operation of the order or regulation;

(b) assessment of any impact in respect of section 75 of the Northern Ireland Act 1998; and

(c) reflection of observations from independent welfare advice service providers.

(2) In publishing any report under subsection (1), the Secretary of State must—

(a) lay the report before the House of Commons;

(b) send the report to the Speaker of the Northern Ireland Assembly; and

(c) be available to appear before a committee of the Northern Ireland Assembly to address, or answer on, the report.” .—(Mark Durkan.)

This amendment confers a responsibility on the Secretary of State to report on the first twelve months of operations and impacts on any orders made under this Act. It would ensure the Secretary of State had to lay the report before the House of Commons, send the report to the Speaker of the Northern Ireland Assembly and appear before a Northern Ireland Assembly committee.

Brought up, and read the First time.

Question put, That the clause be read a Second time.