Diffuse Mesothelioma Payment Scheme

Lord Harper Excerpts

Wednesday 11th February 2015 Westminster Hall

[The Minister for Disabled People (Mr Mark Harper)]

It is a great pleasure to serve under your chairmanship, Mr Owen. I congratulate the hon. Member for Liverpool, Walton (Steve Rotheram) on securing this debate. He takes a close interest in asbestos-related issues. A little while ago, we both took part in an Adjournment debate on other issues related to asbestos and safety.

I start by echoing the hon. Gentleman’s sentiments towards the late Paul Goggins. I remember very clearly the debate in the House on the Mesothelioma Act 2014 shortly after his sad death. I also echo the hon. Gentleman’s generous comments about my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch), who picked up the baton on that occasion, although I do not echo his comments about football. Coming from Gloucestershire, which is a rugby-playing part of the world, I should probably leave the football dispute to other people. [Interruption.] It is probably not good for me to talk about rugby in your presence, Mr Owen, so we will move on.

This has been a very good debate, and it has been helpful in the context of yesterday’s written statement. I will answer some of the questions that colleagues have raised. Following some of the contributions, including from the shadow Minister, it is worth briefly placing on record that the scheme that was legislated for last year, the Diffuse Mesothelioma Payment Scheme, is of course not the only scheme in statute to address such difficult issues. The Pneumoconiosis etc. (Workers’ Compensation) Act 1979 set up the first scheme. That had significant gaps in it, which is why the previous Government, with the support of the then Conservative Opposition, introduced the 2008 scheme in the Child Maintenance and Other Payments Act 2008, which deals with those who did not necessarily work in the industry, but were self-employed, or, in some cases, family members of those who worked in the industry. This scheme comes in the wake of that to deal with some of the issues that those schemes did not deal with.

It is worth putting on the record the scope of the schemes. Although the hon. Member for Strangford (Jim Shannon) mentioned them, the 1979 scheme and the 2008 scheme are both Great Britain schemes, so they do not apply to Northern Ireland. The responsibility for welfare policy lies with the Northern Ireland Executive. The 2014 scheme, which we are discussing today, is a UK-wide scheme and applies in Northern Ireland as well as England, Scotland and Wales.

To pick up the point raised by the hon. Member for Strangford, people in Northern Ireland have three years to apply for the scheme from the point of diagnosis, which is the same as in England, Scotland and Wales, so I do not think there is a difference in the way the scheme operates. However, he is right to point out that the previous two schemes do not apply in Northern Ireland.

[Jim Shannon]

I thank the Minister for giving way; he knows I have to leave fairly shortly and I wanted to intervene in advance of that. After the announcement has been made, when does the Minister hope to have direct contact with the Minister responsible in the Northern Ireland Assembly so that we can co-ordinate the delivery of the compensation plan for the whole of the United Kingdom—Great Britain and Northern Ireland?

[Mr Harper]

I referred to the hon. Gentleman’s point first because I know that he has other pressing business on behalf of his constituents, and he had the courtesy to let me know, so I wanted to deal with his point while he was still in the Chamber. As he knows, I plan to meet the Northern Ireland Minister with responsibility for welfare to discuss other matters to do with welfare in the wake of the Stormont House agreement. I will ask my officials to place this issue on the agenda and we can have a conversation about that to make sure it is clear how it will be implemented in Northern Ireland.

One point flowed through the remarks of the hon. Members for Liverpool, Walton and for Stretford and Urmston (Kate Green) and my hon. Friend the Member for Chatham and Aylesford. I will set out my understanding of the position, which is clear. There was a lot of discussion about the levy on the industry. The scheme is effectively demand-led: people make applications to it and the costs of the scheme are then recovered through a levy on the industry. The 3% that has been talked about is a cap. The insurance industry agreed that if the cost remained below that level, it would absorb the cost of the scheme and would not pass it on to other employers who take out employers’ liability insurance through increased premiums. That was important. The Government did not want the cost of the scheme to fall on employers across Britain: we wanted it to be absorbed by the insurance industry.

So the 3% is a cap, not a target. The costs of the scheme are calculated and then the levy is calculated to recover the costs of the scheme. The hon. Members for Liverpool, Walton, for Strangford and for Stretford and Urmston referred to Lord Freud’s written statement on 28 November last year. He set out the costs of the scheme in the first period of the year, how much that encompassed and how much would therefore be recovered from the insurance industry. That position is clear. [Interruption.] Let me finish this thought and then I will take a question.

Hon. Members seem to have envisaged, although it was not envisaged by the Government, that there would be a 3% levy, some of the money from which would be used for settling claims and the rest would form a pot of money that could be distributed as Ministers or others saw fit. However, it is a cap on the costs that land on the industry. The industry agreed that if that remained the cap, it would absorb the costs of the scheme and not pass them on to employers more generally.

[Kate Green]

Unlike me, the Minister did not sit through all the Bill’s Committee sittings when we were passing the legislation. It really was not our understanding, when his predecessor said that 3% is 3% and not going anywhere, that that meant it was a cap. We took it as a figure that would be reached, and it was also what was understood by the victim support groups.

[Mr Harper]

I take the hon. Lady’s point that I was not the Minister at the time and was not present at those sittings. She asked me a written question following the written statement in November, and I made it clear in my answer that the 3% figure was the maximum percentage of the active employers’ liability insurance market to be levied on the insurance industry to recoup the costs of the scheme. I made it clear that the figure was a cap, rather than a set rate, and that the levy rate was based on the estimated costs of the scheme, extrapolated from the first seven months of the operation. The scheme is demand-led and calculations for the levy are done afresh each year. An upturn in applications to the scheme would result in a higher levy rate in future years, so the levy rate is kept under continual active review.

[Steve Rotheram]

The Minister has used the words “levy” and “cap” interchangeably on numerous occasions, which is confusing. During the passage of the Bill, it was clear that we talked about a levy. The right hon. Member for Hemel Hempstead (Mike Penning) was the Minister at the time, and he talked about a levy. When is a levy a cap?

[Mr Harper]

No, I do not think we are at cross purposes at all. It is a levy, but it is capped at 3%. The amount of the levy is set, based on the costs of the scheme. The costs are calculated and then the levy rate is calculated to recover the costs, and it was agreed that the cap would be 3%. That is the position that I made clear in my answer to the written question from the hon. Member for Stretford and Urmston. It is a levy that is capped at 3%. The deal was that the insurance industry would absorb the costs of the scheme and not pass them on to employers through employers’ liability premiums if they remained below 3%, which is why the 3% cap was set.

[Steve Rotheram]

The Minister is trying valiantly to justify what he has picked up. It is not what was intended for the scheme and it is not what was said during the passage of the Bill. I understand that the cap is a maximum, but it was calculated according to what the industry said it could afford. The industry said 3% of this huge figure—about £1.4 billion or £1.5 billion—was the levy it would draw down. That was the amount that the industry thought would be needed for claimants, and that is why we get the figure of 80%, by the way. It was 80% because the industry thought it would be swallowed up by the 3% levy. I am sorry, but the Minister cannot have it both ways.

[Mr Harper]

The commitment that the industry made was not in terms of what it could afford. It was about what the industry was going to absorb and not pass on to employers more generally. It was important that the costs of compensating sufferers of the disease did not fall on employers generally. We wanted the costs to fall on the insurance industry. It is worth reminding people that the insurance companies that pay the levy today are not necessarily the insurance companies that took the premiums for the policies in the first place. That is part of the problem, because of the long latency of the disease.

Governments have created all the schemes—the 1979 scheme, the 2008 scheme and this one—because of the long period between when someone has exposure to asbestos and the diagnosis of the disease. The impact of the disease over a very long period of time led to all the issues with employers not being in business—that generated the 1979 scheme—and the inability to trace either employers or their insurers. All such issues relate to that long period of time, which is why it is important that the costs are borne by the insurance industry, although they are not necessarily the same companies that took the premiums in the first place. That is why it was important for the Government to work on this in an agreed and proportionate way, so that we could get the scheme in place to ensure the benefits go to the victims of the disease. If the matter had got bogged down in a big argument and legal disputes, there would not be a scheme and there would not be any compensation for people. Both Lord Freud and my predecessor as Minister wanted to make sure that the scheme came into force, so that it could start benefiting victims of this disease.

Let me respond to a couple of questions that the hon. Member for Liverpool, Walton specifically put about the written ministerial statement yesterday, which I think was generally welcomed by colleagues, including my hon. Friend the Member for Chatham and Aylesford. Lord Freud made it clear at the beginning of that statement that we are going to monitor the progress of the scheme and the extent to which the assumptions about claim rates are borne out.

During the first months of the scheme, the number of claims is much lower than at other times. However, partly because the Employers’ Liability Tracing Office has been doing an increasingly good job of tracing insurance policies—meaning that sufferers of this disease can more easily, and rightly, pursue compensation from those from whom compensation is due—the costs of the scheme are lower than had been thought. Therefore, we thought it was right to increase the tariff from 80% of average civil claims to 100% from the date of the announcement. The regulations to bring the scheme into effect will become law next month, but as is usual in government the uprating will apply from the date of the announcement, in the same way that the scheme in the first place applies from the date it was announced, which was 25 July 2012.

That is a general rule in government. I know that it is always difficult, because when a scheme is set up there always has to be a starting point and obviously some people will always be on the wrong side of that starting point. However, it is a general rule in government that we have to start things from when we announce them, and not backdate them. [Interruption.] I hear the shadow Minister, sighing, but if she ever has ministerial responsibility—for various reasons, I hope that she will not have such responsibility—I think she will very quickly understand the logic of not backdating things, and if she does not then the conversations she will have with others in her party will soon persuade her of the wisdom of that approach.

I want to be clear, although I think it was made clear in the written ministerial statement yesterday, that the announcement yesterday means that the scheme will start from yesterday for those already diagnosed, even though that is ahead of the legislation coming into force. Again, that is the same argument that the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) made—I probably mispronounced the name of his constituency, although I always try to pronounce it correctly—when he referred to the starting point of the scheme. I know that he has tabled a number of written questions about this subject on behalf of his constituents, but I am afraid that that has to remain the position.

Both the hon. Members for Liverpool, Walton and for Stretford and Urmston, as well as my hon. Friend the Member for Chatham and Aylesford, talked about increasing the take-up of the scheme. We have been working with stakeholders, including the Asbestos Victim Support group, Macmillan nurses and other groups, to ensure they have information about the scheme, so that they can notify those victims who have been newly diagnosed. We will continue to consider what more we can do. For example, if someone searches for information about this subject on the internet, as is common now, we have made sure that the scheme will come high up on the search list, so that people can locate it. If anyone has any ideas about how better to communicate that information, I am very happy to listen to them. We think that we are doing a good job, but I guess that one can always do better at communicating.

[Mr MacNeil]

I just wanted to check a point with the Minister. Is it his intention that everybody who suffers from this terrible disease gets the compensation they are due, regardless of dates, timings, or whatever? They have suffered and there is compensation in place, so should they all not get that compensation, regardless of some bureaucracy around the edges?

[Mr Harper]

When one sets up a scheme, it has to have a starting point; we cannot extend it indefinitely. Of course, this scheme is not the first such scheme or the only scheme that is available for those who suffer from mesothelioma. There were two previous schemes—the 1979 scheme and the 2008 scheme—and the reason for developing the latter scheme is that there were obviously groups of people who were not covered by the earlier scheme. I remember that the 2008 scheme was specifically designed to cover, for example, family members of those people who had perhaps come into contact with asbestos fibres but who had not worked in the industry and had not been covered by the 1979 scheme; I think that it was the hon. Member for Wansbeck (Ian Lavery) who mentioned those family members. So, we can widen the scope of schemes, but we still need to have a starting point for a scheme. That always generates some concern, because wherever one starts a scheme there will always be somebody on the other side of the line. I recognise why those people will not be comfortable with that, but I do not think that it is an issue.

I will just be clear about another point. Although people affected will be encompassed by the scheme from yesterday’s date, the actual payment to them from the scheme will obviously have to wait for the regulations to come into force next month. Nevertheless, those people will be eligible for the payment from yesterday.

My hon. Friend the Member for Chatham and Aylesford, and others, referred to the issue of research. I know that she has a long interest in this subject because her constituency is, as she said, a hot spot for this disease, given the industrial history of the local area. So she was interested in this subject even before she was a Member of this House. She referred to some research that is taking place in her local area and welcomed the fact that two insurance companies have put money into research. She made the point very well, that those companies had perhaps demonstrated a certain amount of leadership, and she was keen for others in the industry to follow their lead; I am sure that they will have noted that call.

As I say, my hon. Friend specifically talked about research. The Government agree with her: we also want to see more research in this area. The National Institute for Health Research is calling for mesothelioma research proposals. I listened carefully to the point that was made—I think it was by the shadow Minister—about a written answer that the Minister of State, Department of Health, my right hon. Friend the Member for North Norfolk (Norman Lamb), had given about this issue. I have not seen that written answer, but it sounded like he had talked about some research proposals that were awaiting funding. However, my hon. Friend the Member for Chatham and Aylesford referred to a shortage of research proposals. So I will ask officials to look at this apparent discrepancy. The shadow Minister said there were lots of proposals but no money, whereas my hon. Friend said that there were not really enough proposals.

Another hon. Member also referred to a shortage of research proposals; I forget whether it was the hon. Member for Liverpool, Walton or the hon. Member for Wansbeck. The general sense that I was picking up was that the number of research proposals did not seem to be in line with the tragically large number of people who are dying from this disease—it seemed out of kilter—so the points by my hon. Friend and other hon. Members about research were well made. We set up a partnership, including patients and clinicians, to identify research priorities in this area, and the results were published in December.

[Mr MacNeil]

What then is available to my constituent, who was diagnosed before 25 July 2012, but died in November 2012?

[Albert Owen (in the Chair)]

The Minister has just over two minutes left to speak.

[Mr Harper]

Given what the hon. Gentleman says, and it is obviously the reason why he has tabled written questions, his constituent is not eligible for this scheme. What I do not know without looking at the specific facts of the case—obviously, if he has not already done so, he can either write to myself or Lord Freud with those facts—is whether they will be eligible for one of the other existing statutory schemes. If the hon. Gentleman writes to us, we can then look into the case to see whether his constituent is eligible for the other schemes.

[Steve Rotheram]

Will the Minister give way?

[Mr Harper]

Of course—briefly.

[Steve Rotheram]

I will be very brief, before the Minister finishes his remarks. Given that the expectation, even from the industry, was that the cost of the scheme would equate to 3%—I do not think that is arguable; hence the levy—does he believe that some of the residual amount, or underspend, should be invested in research? It is really important that research is top of the agenda.

[Mr Harper]

There are two separate questions there. I do not agree with the hon. Gentleman’s characterisation—I suppose it depends where you start from. His understanding was that the 3% was an amount that was going to be levied to generate an amount of money, some of which would be used for the compensation and then, effectively, others could choose to spend it, but that is not my understanding and not the Government’s understanding of the scheme.

However, his general point—I am trying to answer his question about research funding—is that there is a clear view that there should be more research in this area. I will undertake to go away and look at the gap in the general debate between—

[Kate Green]

Will the Minister give way?

[Mr Harper]

Let me just answer the hon. Gentleman’s question; I hope the hon. Lady will forgive me for not giving way to her. As I was saying, I will look at the gap between the number of research proposals—my hon. Friend the Member for Chatham and Aylesford suggested there are not enough proposals, whereas the hon. Lady suggested there were quite a lot of proposals but not enough money. Let me look at what money is available from statutory funding sources; from the National Institute for Health Research and other funders in the area. It might be helpful if we can draw that funding information together, so that Members can see the overall picture of funding in this area. I would be interested to look at that and see how it is related to the need, based on the number of people who are sadly victims of this dreadful disease. That may be helpful to inform further developments—

[Albert Owen (in the Chair)]

Order.

Allied Steel and Wire (Pensions)

Lord Harper Excerpts

Tuesday 10th February 2015 Westminster Hall

[Gregg McClymont]

No one can doubt the attention that Community has paid to making that case for its members, who suffered great detriment as a result of the collapse of these pension schemes.

I know from the discussions that I have had that there was a strong sense that there would be further action, given the promises made by the parties that are now in government. Actually, given the current situation, the previous Government’s substantial intervention stands as the signal contribution from the state to alleviating the detriment suffered by members of those schemes. Since 2010, there has been no advance on the agreement reached under the previous Government. Of course, that agreement has virtues—up to 90% is a lot more than nothing. It is a big difference.

Community and Unite have acknowledged to me that the previous Government’s intervention made a substantial difference. Of course it did. Those who lost their pensions now receive up to 90% and a cap at approximately £29,300—I cannot remember the precise number; I think it is £29,348. That is a significant advance, but those people had a strong feeling that they would get more if there was a change of Government; perhaps that speaks to the differences between opposition and government. None the less, promises were made, and those who made them should account for why they have not been fulfilled.

[The Minister for Disabled People (Mr Mark Harper)]

I am listening carefully to the hon. Gentleman. He may be getting to this, so he will have to forgive me if I am jumping the gun. Given the tone of what he is saying, is he making a commitment on behalf of the Opposition to make a significant financial improvement to what is on the table?

[Gregg McClymont]

That is the difference between what a responsible Opposition do and what appears to have happened before 2010.

[Mr Harper]

So it is just words.

[Gregg McClymont]

The Minister says it is just words, but the words that those campaigning for the parties that are now in government used have not materialised into any action. The difference between the Government parties and Labour is not only that the previous Government actually acted, but that we are a responsible Opposition and we will not promise things that we do not intend to deliver.

--- Later in debate ---

[The Minister for Disabled People (Mr Mark Harper)]

It is a great pleasure to serve under your chairmanship, Mr Hollobone. I pay tribute to my hon. Friend the Member for Sittingbourne and Sheppey (Gordon Henderson) for securing the debate.

The hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont)referred to my right hon. Friend the Minister for Pensions. I should be clear that my right hon. Friend, like the shadow Minister, was scheduled to be in a Committee considering regulations for an hour and a half, so he prudently ensured that a Minister was available from the Department to answer this debate. Due to the fact that the regulations were clearly excellent and that the Opposition had very few questions and did not challenge them, the Committee unexpectedly finished early. However, the Pensions Minister had secured my cover for this debate, which is why I am here and he is not. I am sorry that that is so disappointing to the shadow Minister.

I thank those Members who have contributed to the debate, as well as other Members and those outside the House who worked to establish the financial assistance scheme in the first place. The scheme ensures that people who were members of schemes that went into wind-up prior to the introduction of the Pension Protection Fund will get some financial help, which they otherwise would not.

It is also worth saying—the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East acknowledged this point—that I understand the views of all the pensioners who have been affected, but the fact is that the pension schemes that were wound up without sufficient funds in them to pay those pensions mean that those pensions effectively do not exist and have been lost. Without the financial assistance scheme, there would not be the funds to pay those pensioners either in part or at all, so they would be in a far worse situation. What we are discussing is the amount of help people can expect from the Government, and of course, there is no Government money; what we are talking about is the amount of money that taxpayers more generally are prepared to make available.

My hon. Friend the Member for Sittingbourne and Sheppey made the point about what people could expect. My understanding is that the financial assistance scheme has always promised that people would get 90% of their expected pension accrued at the point of winding-up, subject to a cap. That is obviously not the same as the amount that someone who had continued their working life would have expected had the scheme been fully funded. My understanding is that that is not what the Government ever promised. When the previous Government set up the financial assistance scheme, they promised 90% of what would have been accrued at the point of wind-up, and I think that is what has been delivered.

My hon. Friend referred to the cap, whereby when someone was entitled to a higher pension, the FAS caps the amount of assistance paid. That cap was put in place to target the payments on the lowest-paid pensioners. The cap was £26,000 for anyone who began to be paid before April 2007. It is increased annually and is now £33,454, and the amount paid depends on the level of cap in place when the payments begin. For example, a person whose payments began in 2012-13 would have a cap of £31,873, which is more than twice the average occupational pension in the UK in the same period.

When the changes to the PPF cap legislation were made, the Minister for Pensions said that he was considering whether a similar change could be made to the financial assistance scheme. He continues to keep the matter under review and is having discussions with his Treasury colleagues about whether that is doable and affordable. No doubt he will keep the House fully informed on the progress of those discussions.

One point made by my hon. Friend the Member for Sittingbourne and Sheppey and others was about indexing what was accrued before 1997. The FAS reflects the statutory requirement on all schemes, which is to index post-April 1997 accruals in line with the consumer prices index, capped at 2.5%. My hon. Friend did not think that was in line with the PPF, but in fact it is. The PPF has the same indexation post-April 1997, which is CPI, capped at 2.5%. The PPF also pays 90% of the expected pension, so the FAS is in line with the PPF. It would be difficult to argue that the FAS, largely funded by the taxpayer, should be more generous by paying to index pre-1997 accruals than the PPF, which is partly funded from a levy on pension schemes.

If we did index the pre-1997 accruals, that would not be inexpensive. It was estimated in 2010 that providing indexation on all assistance to all FAS recipients in line with the retail prices index, as it was then done, capped at 2.5%, would cost an extra £845 million of taxpayers’ money. That would be the net present value. If we accept that the money available is limited, a choice has to be made. We could provide more generous indexation, which would benefit those pensioners who live longer, but the cost of doing that is that we would pay a smaller percentage of pensions at the beginning. I think the scheme has made the right judgment.

I want to cover one point on the cost. I listened carefully to my hon. Friend and I have heard the point before about the value of the assets of schemes transferred into the FAS being broadly similar to the cost of the scheme. That is not right. In December 2007, the Government announced a significant extension to the FAS. That was funded by a combination of the money transferred in from schemes that were not wound up, which was an estimated £1.7 billion, and an increase in the taxpayer contribution, taking the total taxpayer contribution to the FAS to £12.5 billion. The net sum from the taxpayer to stand behind this pension promise was nearly £11 billion. I think that is very significant.

The hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East is right to say that the promise was made by the previous Government, but of course this is an ongoing commitment, which is being met and stood behind by the present Government. It is an ongoing commitment for taxpayers today and it is a very significant cost. It clearly is not covered by all the assets being transferred in, because if all the assets being transferred in matched the cost of delivering the promise, there would of course be no need for a financial assistance scheme in the first place. The whole point is that the assets in the pension schemes do not, for all sorts of reasons, fund the promises that were made.

On the issue of funding, I listened very carefully to the hon. Gentleman, who seemed to be giving the impression that the Opposition were going to do something significant. I simply wanted to probe him on that and be clear that he was not making any financial commitments. I am not aware that my party made any financial commitments that we have gone back on. Indeed, the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop), who is no longer in his place, referred to Equitable Life. I will be brief on this, Mr Hollobone, because I am getting slightly off the subject of the debate, but as the point was made, let me say that my party did make some commitments on Equitable Life—I followed that very closely, because I have constituents who were affected—and we have delivered on what we promised to do for Equitable Life annuity holders. I have had lots of correspondence with Ministers and with my constituents, and we absolutely have delivered on that, so I do not quite know what point the hon. Gentleman was making.

I was not sure, either, where the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East was going with the promises that my party makes. I was listening carefully and I did not hear any specific promise that we were alleged to have gone back on. We have stood behind the very significant commitment that the previous Government made, which is an ongoing commitment, and we have done that in the context of inheriting a very difficult financial situation—in the words of the former Chief Secretary to the Treasury, there was no money left.

This is a significant commitment. It was the right commitment for the previous Government to make, and this Government have honoured the commitment even in the very difficult financial circumstances that we inherited. We are right to have done so, but it does mean—this is where I agree with the hon. Gentleman —it is difficult to justify putting even more taxpayers’ money into a scheme to do the things that my hon. Friend the Member for Sittingbourne and Sheppey and his constituents want. I completely understand that, but we have to recognise that other taxpayers would have to foot the bill.

[Gordon Henderson]

I accept everything that my hon. Friend the Minister has said, but does he not accept that there is a principle involved? The principle is very clear: the Government of the day misled people into believing that their occupational pension would be safe and was safe to invest in. That is what the parliamentary ombudsman, the High Court and the Court of Appeal decided—that those pensioners had been misled—and therefore it is morally wrong for any Government, of whatever complexion, to use finance as a reason for not giving those people justice.

--- Later in debate ---

[Mr Harper]

Following on from that point, I think, having read through the detail of the case, that what my hon. Friend says is exactly why a financial assistance scheme was set up in the first place, and very significant amounts of taxpayers’ money were put into it. As I said, the total commitment from the taxpayer is now about £12.5 billion and about £1.7 billion has come in from the schemes that were not wound up. That is a very significant commitment from the taxpayer in order to provide protection for pensioners who are not getting support from pension schemes because those schemes were not adequately funded to meet the promises that had been made.

My hon. Friend said that a number of pensioners in the schemes covered by the FAS have died over time and that in some way reduces the cost. It does not, because the calculation of the total cost will have taken into account the age profile of the pensioners and the expected number of deaths—that is the rather brutal science in which actuaries are involved. That factor will have been taken into account in the costings, so no extra money arises from the fact that some pensioners in schemes covered by the FAS are, sadly, no longer with us.

My hon. Friend made a point about workers who became pensioners before the FAS was first announced, in May 2004. As is normal with all Government schemes, assistance payments are not backdated to before the announcement date, so anyone who became a pensioner before May 2004 gets assistance from that date only. The same applies to the PPF: it does not pay compensation for any period before it was introduced.

I listened carefully to my hon. Friend’s point about overpayments. Because a scheme does not know at the beginning of the winding-up process the exact value of the assets it has and what each member is entitled to, it pays interim pensions—its best guess of what the member will get when the scheme does wind up. At the end of the winding-up, the scheme balances its payments, paying less in the future if a person has been overpaid during the winding-up period. Where possible, the FAS balances overpayments and underpayments once it has the full data, which is the same as the approach taken by schemes. During the winding-up period, the FAS tops up any interim pension to 90% of the expected pension, based on data provided by the scheme. I understand that it used to be 80%, but in response to representations from the various groups, the then Government raised the limit to 90%. That narrows the margin for error, so if there is an error in the data provided by the scheme, that increases the chances of having to recover an overpayment.

The reason why the overpayments are not simply written off is because the FAS is largely funded by the taxpayer. The Department uses the guidance “Managing public money”, which is issued by the Treasury. That is the same guidance used when, for example, the Government overpay benefits and have to recover them. The FAS does what the schemes would do to recover overpayments: it turns the amount that has been overpaid into a notional annuity and deducts it from the assistance due, so that over the individual’s lifetime, they will receive the correct amount.

I listened carefully to my hon. Friend, and I think he said that one of his constituents did not receive good communication from the FAS about the fact that they had been overpaid and that the overpayment would be recovered. I am sure that my hon. Friend will correct me if I am wrong. If that is the case, there is no excuse for poor communication. If I have correctly understood that that came as a surprise, it would be helpful if he wrote to the Minister for Pensions, if he has not done so already, so that we can look into that breakdown of communication.

[Gordon Henderson]

May I clarify that point? My constituent’s complaint was that he is aware of other people in similar situations whom the PPF contacted to negotiate a repayment plan to ensure that it recovered the money over time, but he was not given that opportunity. I have already written to the PPF to ask why it did not negotiate, and why it immediately stopped his pension entirely. That was his point; he was not given an opportunity to negotiate and say, “Right, I will pay off x amount per month.”

[Mr Harper]

I am grateful to my hon. Friend for that clarification. He has already written to the scheme, so I will draw his comments to the attention of the Minister for Pensions. It may be helpful for the Minister to look at the case and perhaps write to my hon. Friend about it, because it is difficult to go into the specifics of an individual case in an Adjournment debate.

My hon. Friend rightly raised the subject in his role as Member of Parliament for his constituents. He acknowledged in his speech the assistance he has received from those in his constituency who have campaigned on the matter. I recognise that he and those whom he represents are probably disappointed by what I have had to say. However, I hope he understands that, given the very significant contribution that taxpayers rightly continue to make to the financial assistance scheme, there is a limit to the amount of support that taxpayers can give. I fear that it will not, therefore, be possible to deliver the things that he has requested, given the circumstances that we still face in the public finances because we are dealing with the legacy that we inherited from the previous Government.

[Mr Philip Hollobone (in the Chair)]

I thank all hon. Members who took part in that important debate for covering all the issues pithily and succinctly. The next debate is not due to start until 11 o’clock, so I will suspend the sitting until that time. However, if the participants arrive a few minutes early, we will start when they arrive. The sitting is, therefore, suspended until about 11 o’clock.

Diffuse Mesothelioma Payment Scheme

Lord Harper Excerpts

Tuesday 10th February 2015 Written Statements

[The Minister for Disabled People (Mr Mark Harper)]

My noble Friend the Under-Secretary of State for Work and Pensions (Lord Freud) has made the following written statement:

I am today announcing an increase to the tariff of payments made under the Diffuse Mesothelioma Payment Scheme which was introduced by the Mesothelioma Act in April 2014. I will shortly bring forward regulations to increase the tariff from 80% of average civil claims to 100% for those diagnosed on or after today’s date. While the uprating will apply to those diagnosed from today, the formal payment process will take effect when the regulations become law next month.

This uprating reflects our monitoring of the progress of the scheme. The number of claimants has proven to be below the level anticipated. I made it clear through the passage of the Mesothelioma Act that I planned to monitor the scheme to gauge the extent that the assumptions made when it was being set up had been borne out in practice and would also consider the impact on the insurance companies who pay for it.

It is already clear that the insurance industry, through its Employer Liability Tracing Office, is doing an increasingly good job at tracing insurance policies which means sufferers can more easily pursue compensators for a remedy. I am determined that this success is maintained, reinforced by regulation from the Financial Conduct Authority.

Following discussion with the insurance industry, I have agreed to introduce some additional administrative safeguards to ensure that we can all be confident that the scheme continues to act as we intended and remains a scheme of last resort. I am pleased to be able to agree to their requests.

This change reflects our ongoing commitment to sufferers of this disease and their families.

[HCWS269]

Social Security (Statutory Instruments)

Lord Harper Excerpts

Monday 9th February 2015 Commons Chamber

[The Minister for Disabled People (Mr Mark Harper)]

I beg to move,

That the draft Mesothelioma Lump Sum Payments (Conditions and Amounts) (Amendment) Regulations 2015, which were laid before this House on 14 January, be approved.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

With this we shall take the following motion, on pneumoconiosis:

That the draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2015, which were laid before this House on 14 January, be approved.

[Mr Harper]

I am sorry that the names of these regulations are not very catchy, but they are important none the less. I confirm that they are compatible with the European convention on human rights. The two schemes stand apart from the main social security uprating procedure, and there is no legislative requirement to review the level of payment each year. However, I am happy to increase the amounts payable for 2015 by the consumer prices index—that is, 1.2% as at September 2014, which is the same rate being applied to some social security disability benefits and industrial injuries disablement benefit. I was here for the previous debate when my right hon. Friend the Minister for Pensions clearly set out why CPI, rather than the discredited retail prices index, is the right measure by which to increase these benefits. I do not propose to detain the House by repeating his very clear and detailed explanation.

The Government recognise that people suffering from diseases as a result of exposure to asbestos or one of a number of other listed agents may not be able to bring a successful claim for civil damages, partly due to the time lag between exposure and the onset of the disease, which could be as long as 40 years. As well as compensating people who cannot make civil claims, these two schemes fulfil an important role by ensuring that most sufferers receive compensation while they can still benefit from it.

The Pneumoconiosis etc. (Workers’ Compensation) Act 1979 provides a lump sum compensation payment to those who suffer from one of five dust-related respiratory diseases, who are unable to claim damages from employers who have gone out of business, and who have not brought any action against others for damages. The 2008 scheme provides compensation to people who contracted mesothelioma but were unable to claim compensation for that disease under the ’79 Act, perhaps because their exposure to asbestos was not due to their work. The 2008 scheme means that payments can be made quickly to mesothelioma sufferers at their time of greatest need.

Under both schemes, a claim can be made by a dependant if the sufferer has died before being able to make a claim. Payment levels under the ’79 Act scheme are mainly based on the level of the disablement assessment and the age of the sufferer at the time the disease is diagnosed. The highest amounts are paid to those diagnosed at an early age and with the highest level of disablement. All payments for mesothelioma under the ’79 Act scheme are made at the 100% disablement rate—the highest rate of payment. Similarly, all payments under the 2008 scheme are made at the 100% disablement rate and based on age, again with the highest payments going to the younger sufferers. In the last full year, April 2013 to March 2014, over 3,700 payments were made in respect of both schemes, totalling over £54 million.

These regulations increase the levels of support through the Government compensation schemes. I am sure we all agree that while no amount of money can ever compensate individuals and families for the suffering and loss caused by mesothelioma, those who are suffering rightly deserve some form of monetary compensation. I commend the regulations to the House.

--- Later in debate ---

[Mr Harper]

I will try to respond to all the questions that have been asked.

The shadow Minister, the hon. Member for Stretford and Urmston (Kate Green), asked about the progress that has been made to change the statutory position on uprating. That remains under review, but the House can see the Government’s view clearly from the fact that I am bringing forward the orders to increase the payments by the rate of CPI. As hon. Members have said, that reflects the importance of uprating the amount in line with inflation.

The shadow Minister and one or two other Members referred to the balance between the compensation that is paid to sufferers of the disease and that which is paid to their dependants. The main intention of the schemes was to ensure that financial support went to the people suffering from those diseases. They were set up as they were, with no fault having to be produced and a focus on the speed with which payments were made, to ensure that the support could go to the sufferer of the disease while they were still in a position to benefit from financial compensation.

When the Child Maintenance and Other Payments Act 2008 was debated in the House—the hon. Member for Barrow and Furness (John Woodcock) referred to his part in that—I was a shadow Minister and the Bill had the full support of the Conservative Opposition. One issue was about ensuring that we were speedy in providing compensation, given the small gap between when someone is diagnosed with mesothelioma and, sadly, their inevitable death. We got compensation to people while they were still able to—I am not sure “enjoy” is the right word, but to benefit from it to the extent that that was possible.

The hon. Member for Stretford and Urmston is right to say that most payments are made to sufferers rather than dependants: in 2013-14, 3,410 payments were made to sufferers and 360 to dependents. As my predecessor rightly said in the debate last year, the case for the equalisation of those payments was kept under review, and our most recent assessment is that it would cost a further £2 million a year. It is worth putting on record that in the Pneumoconiosis etc. (Workers’ Compensation) Act 1979 and the 2008 schemes, payments substantially outweigh the money received from compensation recovery. There is no money sitting around to make those payments. The Government paid out more than £54 million of taxpayers’ money, and recovered just under £26 million. The two schemes together cost the taxpayer nearly £29 million, and in the current financial position one has to make difficult choices about funding these schemes. They are already costing £29 million, and it would cost a further £2 million to make those changes. However, we will keep the position under review.

The hon. Lady referred to what the Health and Safety Executive is doing to raise awareness of the dangers of asbestos. I am familiar with that because I launched the current £1.13 million awareness campaign last October, which was particularly aimed at helping at-risk workers recognise that asbestos was relevant to them and their work. It encouraged them to seek reliable information about how they can protect themselves, and encourage and enable safer working with asbestos through behavioural change.

On the day we launched that campaign I went to a large company that sells products to small traders, who are often at risk when they carry out that work. We used information packs and information that small traders could use and access on their smartphones to answer questions about the type of properties they were working in and the risks they may face, and those I spoke to found that helpful. That campaign is due to end in March, and a fuller valuation of it will be undertaken before any decision is made about a further campaign in the next financial year. The HSE and those in the various trades that are affected by this issue take it very seriously. I was encouraged to see that there is a fair degree of knowledge about it, although not as much as one would hope, given the serious health consequences of not taking the issue seriously.

The hon. Member for West Dunbartonshire (Gemma Doyle) made a point that was echoed by my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch), which was that sufferers of this disease are not evenly distributed throughout the United Kingdom. They reflect industrial work patterns and are not evenly spread, and some Members who have spoken today will obviously have a larger number of constituents who are affected.

The hon. Members for West Dunbartonshire and for Barrow and Furness also referred to the new scheme that was set up last year. That is not what we are debating now, but in case hon. Members are not already aware—I am sure they are—the hon. Member for Liverpool, Walton (Steve Rotheram) has secured a debate on that issue this Wednesday in Westminster Hall at 9.30 am. I will be responding on behalf of the Government and will deal with any questions that hon. Members may have.

The hon. Member for West Dunbartonshire raised an issue concerning the armed forces. If she will forgive me, I will take that away and raise it with my colleagues in the Ministry of Defence. I am not quite sure what the answer will be, but I suspect that the most sensible way to progress is for either me or a Defence Minister to write to the hon. Lady and to put a copy of the letter in the House of Commons Library. I have no doubt that she will be assiduous in pursuing us if that does not happen on a timely basis, or if she is not satisfied with the response.

My hon. Friend the Member for Chatham and Aylesford referred to the increasing incidence of the disease. There is a very long period between people being exposed to asbestos and being diagnosed and, sadly, dying from the disease. The latest available information suggests that the number of deaths will continue to increase and peak at about 2,500 in 2018, but will then start to fall, reflecting a reduction in asbestos exposure following its peak use in the 1960s and 1970s. The research she mentions is clearly important. If there are bursaries out there, it is obviously helpful if people take them up. More research by some of our best scientists would clearly be welcome to see if there is anything that can be done, once people have been exposed to asbestos, to stop the development of this dreadful disease.

I think that that deals with all the questions raised by Members on both sides of the House. I commend the regulations to the House.

Question put and agreed to.



Social Security

Resolved,

That the draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2015, which were laid before this House on 14 January, be approved.— (Mr Harper.)

Social Security and Pensions (Statutory Instruments)

Lord Harper Excerpts

Monday 9th February 2015 Commons Chamber

[Steve Webb]

I will come on to the issue of the use of the RPI, because the right hon. Gentleman knows the RPI has fallen into disrepute and no credible Government would have continued with the RPI, so the question does not arise.

The new rate of the state pension will be £115.95 a week for a single person, an increase of £2.85 from last year. We estimate this means the basic state pension will be around 18% of average earnings, and my hon. Friends might be interested to know that, as a share of the national average wage, that is the highest rate of state pension for over two decades. Thanks to the coalition Government’s commitment to the triple lock, a person on a full basic state pension will, as my hon. Friend the Member for Worcester (Mr Walker) said, receive around £560 more in 2015-16 than if the basic state pension had been uprated only by earnings during this Parliament. That commitment means that, since coming into office, this coalition has increased the basic state pension by about £950 a year.

The triple lock applies to the basic state pension, and the question is: what should we do for the poorest pensioners on pension credit? Under the law left to us by the previous Government, we are required to uprate pension credit only in line with earnings. We could therefore have done the legal minimum and put the pension credit up by about 0.6%. However, we thought that that was too little for the poorest pensioners. We wanted to ensure that the very poorest pensioners, those who are dependent exclusively on the guaranteed credit, would benefit in full from the triple lock.

Each year, the standard minimum guarantee must be increased only in line with earnings, which would have equated to 0.6%, but to ensure that the poorest pensioners benefited from the full cash value of the increase in the basic state pension, we decided to increase the value of the standard minimum guarantee by 1.9%, so that single people would receive an increase of £2.85 a week and couples would receive an increase of £4.35 a week. Consistent with our approach last year, the resources needed to pay for this above-earnings increase to the standard minimum guarantee have been found by increasing the savings credit threshold, which means that those with higher levels of income may see less of an increase.

This year, the state earnings-related pension scheme—SERPS—and the other second pensions will rise by 1.2%. Labour froze SERPS pensions in 2010, but this will be the fifth year in a row that the coalition has uprated SERPS by the full value of the consumer prices index.

This year, the coalition will continue to ensure that those people who face additional costs because of their disability, and who may have less opportunity to increase their income through paid employment, will see their benefits increase by the full value of the CPI. So disability living allowance, attendance allowance, carers allowance, incapacity benefit and personal independence payment will all rise by 1.2 % from April 2015. In addition, those disability-related and carer premiums paid with pension credit and working-age benefits will also rise by 1.2%, as will the employment and support allowance support group rate and the limited capability for work and work-related activity element of universal credit. Pensioner premiums paid with working-age benefits will increase in line with pension credit.

We have been debating the use of the CPI on a more or less annual basis for the past four years. When we first switched to using the CPI, the right hon. Member for East Ham (Stephen Timms) responded to the debate. He rather inventively accused us of being “ideologically driven” in our switch to the consumer prices index from the retail prices index. The choice of a price index for the uprating of benefits is not quite up there alongside the great battle between communism and capitalism, is it? At the time, however, he said:

“Changing permanently from RPI to CPI, other than in this year, and keeping things that way even after the deficit is long gone, is plainly not a deficit reduction measure—it is ideologically driven, and the Opposition do not support it.”—[Official Report, 17 February 2011; Vol. 523, c. 1182.]

Since then, there has been a great deal of analysis of the suitability of different price indices, and his view that we should somehow clear the deficit—I do not know when, under his plan—and then go back to the good old RPI is no longer credible. I hope that he will set out his position on uprating when he responds.

The right hon. Gentleman is sceptical of my views on these matters—he hides it well, but he probably is—so I want to bring forward two witnesses. My first witness is Tim Harford, who presents the BBC’s statistics programme “More or Less”.

[The Minister for Disabled People (Mr Mark Harper)]

Very good!

[Steve Webb]

I know that my hon. Friend listens to nothing other than podcasts of “More or Less”. When Tim Harford was interviewed on the “Today” programme recently, he was asked what his favourite statistic was. The nation waited, agog to hear his reply. He said it was the CPI. So when the BBC’s go-to guy for statistical rigour and reliability was asked to choose from a multiplicity of official statistics, he homed in on the CPI as the epitome of a good statistic. We therefore make no apology for using it.

The national statistician, Sir Andrew Dilnot, commissioned Paul Johnson, the director of the Institute for Fiscal Studies, to carry out a review of price indices. This year, we had four to choose from: RPI, RPIJ, CPIH and CPI. We have opted for CPI. The right hon. Gentleman is seeking to imply that we should use RPI, perhaps because it is bigger, but it is interesting to note what Paul Johnson said about RPI, to which the Opposition are still wedded—or at least they were, the last time I heard. Paul Johnson’s recommendation was:

“ONS and the UK Statistics Authority should re-state its position that the RPI is a flawed statistical measure of inflation which should not be used for new purposes”.

He went on to state:

“Government and regulators should work towards ending the use of the RPI as soon as practicable.”

He made it absolutely clear that RPI was flawed and that we should restate that fact, which I am happy to do. He thought that RPIJ should probably be discontinued and that CPIH needed some methodological work to get it right. So CPI is the only credible index available to us. If the right hon. Gentleman implies in his response that we should use something else, I would like to know his basis. We believe the price index should be chosen on the basis not of whether it is high or low, but whether it is accurate. That has been the policy of this Government.

Employment and Support Allowance and Work Capability Assessments

Lord Harper Excerpts

Thursday 5th February 2015 Westminster Hall

[The Minister for Disabled People (Mr Mark Harper)]

It is a pleasure to serve under your chairmanship, Mr Walker. My heart sank when you said that you would call the Front Benchers at six minutes past 4. I thought that we would have only 11 minutes each, but I have a few extra minutes. I doubt that I will be able to cover the Select Committee’s report, our response and all of the many sensible contributions that have been made this afternoon, but I will do my best.

I thank the hon. Member for Aberdeen South (Dame Anne Begg), the Chairman of the Select Committee, for opening the debate, and the other members of the Select Committee who were here for at least part of the debate and who contributed. I welcome their interest in the WCA and ESA.

We carefully considered the Committee’s recommendations, and we published our response on 27 November. On the same day, as a number of Members have mentioned, Dr Paul Litchfield published the fifth and final review into the work capability assessment. We responded positively to the Select Committee’s recommendations in a number of areas, and where we did not agree with them we set out why. I will say a little more about the recommendations that have been referred to. The Government also took the opportunity to announce a package of short-term ESA measures and to set out our view of the challenges ahead for those who make policy in this area.

My hon. Friend the Member for Newton Abbot (Anne Marie Morris) spoke about improving delivery. We will make a significant amount of progress once Maximus starts the work. I have been impressed by its performance so far in preparing to take over the contract, and I said a little about that to the Select Committee when I gave evidence recently. I want us to ensure that the assessment process is hugely improved.

My hon. Friend the Member for Newton Abbot and the hon. Member for Hampstead and Kilburn (Glenda Jackson) referred to the number of disabled people in work. I think it is fair to say that my hon. Friend looked at it from the glass-half-full end of the spectrum, while the hon. Lady looked at it from the glass-half-empty end. The good news, which leans more towards my hon. Friend’s side of the argument, is that this year there are a quarter of a million more disabled people in work in Britain, compared with last year. Although the disability employment rate is too low, and although it is lower than the rate enjoyed by those without a disability, it increased by 2.5%, which I believe is the largest year-on-year increase in a decade. I acknowledge that we have more to do, but we have made good progress.

As my hon. Friend and others know, our ambition is to ensure that the UK is at the top of the G7 employment league table, and that we effectively achieve full employment. We can do that only if we are much better at keeping people who develop health conditions and disabilities in work, and getting those who have health conditions and disabilities back into work or into work for the first time.

Let me turn to the points in the Select Committee’s report that Members raised today. The first point that the Chairman of the Select Committee raised was about the work capability assessment itself. As she knows, and as the Committee said in its report, there was an evidence-based review, in which experts tested the WCA against a set of alternative descriptors. Therefore, a lot of bright people have thought about whether there is a better way of assessing people’s ability to work and the impact of their health condition or disability on their ability to work. The evidence that it published in its conclusion showed that there is not a strong case for replacing the WCA with the alternatives, because they are not better than the WCA at coming up with the information.

Dr Litchfield’s report specifically referred to the number of changes and improvements to the WCA in recent years, driven by the independent reports of Dr Litchfield and his predecessor, Professor Harrington. Dr Litchfield specifically called for a period of stability to let the assessment bed down. He recognised that although the WCA is by no means perfect, it is the best means available, and there is no ready replacement. He said:

“my counsel would be to let the current WCA have a period of stability—it is by no means perfect but there is no better replacement that can be pulled off the shelf.”

I agree. I also think, as my hon. Friend said, that the last thing that we should do, as we bring in a new provider, is to start changing the process and how the system works. In my experience of having to implement tough operational processes, I do not think that that is the way that we will improve the performance of the system for all those going though the process.

The hon. Member for Edinburgh East (Sheila Gilmore) and, I think, the shadow Minister referred to the other changes that we set out at the same time as we responded to the report. We are allowing JSA claimants with short-term health conditions to stay on JSA for up to 13 weeks, and, importantly—the hon. Member for Edinburgh East did not focus on this—we are tailoring conditionality to keep people closer to the labour market. We recognise that if a person has a health condition, the claimant commitment may have to be different. Work coaches in jobcentres have the ability to flex the claimant commitment. Although I heard a lot of general assertions that that does not happen, I did not hear any specific examples. If people have got specific examples, I want to know about them, because we can then address whether work coaches are using that flexibility. They have the power to flex the claimant commitment, and they should be using it.

[Sheila Gilmore]

Given what the Minister has just said, why were similar words not used in the Government response, rather than giving as the only example people making a full-time work search? That gives the impression to anybody who reads the response that that will be the main issue for a claimant commitment.

[Mr Harper]

The hon. Lady may be reading too much into the wording, and she is straying into conspiracy theory. I cleared the language in the Government response, and I have tried to give the same impression in what I have just said. It certainly was not our intention to give the impression in the Government response that the hon. Lady took from it. I think that I have set out clearly what we are trying to do.

We are introducing three new measures, the first of which is a voluntary early intervention pilot for new ESA claimants, in which we are trialling occupational health advice and support prior to the WCA. We are doing so for a sensible reason. My hon. Friend the Member for Newton Abbot, the hon. Member for Edinburgh East and the Chair of the Select Committee referred to the fact that the WCA was designed to be two things: a benefit eligibility test, and a test of the barriers that an individual faces to entering work, and the support that they require to do so. We ought to see whether we can intervene when somebody first applies for ESA, to see what support they need and get them that support early in the process.

That is important because—I know that this is an area in which you take a particular interest, Mr Walker—46% of people who claim ESA do so for the primary reason that they have a mental health condition, and 60% have a mental health condition as part of the issue. We know from the evidence, and from all the campaigning organisations that are expert in this area, that being out of work for a significant period of time makes a mental health condition worse, not better. If we can identify mental health problems earlier and deliver support earlier, we will either keep people in work or enable them to go back to work more quickly. There is a nugget of truth in what hon. Members have said about that, and that is why we are piloting some interventions to see what is effective. They are voluntary, so people do not have to take part in them, but we think that they will be useful and produce useful evidence. I will not set out anything about the other two measures that we are introducing, because I recognise that time is pressing.

My hon. Friend the Member for Newton Abbot and other hon. Members referred to the WCA’s ability to deal with mental health issues. When we designed the ESA50 questionnaire and assessment criteria, we had input from mental health organisations and groups that focus on other hidden impairments such learning disability and autism. Several hon. Members, including the shadow Minister, referred to my remarks at the Select Committee about the redesigned ESA50 form. That will be implemented this month, and we are also looking at all the communications that we use for claimants following Dr Litchfield’s recommendations in his fourth independent review. We expect those to come into force over a rolling period this year.

The letter that we issue to claimants when a decision is made, the ESA260, was revised in the autumn of last year, and I referred to that in the debate initiated by the hon. Member for Edinburgh East earlier this week. That letter now makes it very clear—the shadow Minister made a point about this—which group somebody has been put into. It informs them in clear, plain English about the time limiting for someone who is in the work-related activity group and on contributory ESA. It makes clear the consequences and implications of the decisions that have been taken, enabling the individual to act accordingly.

Let me say a word about information sharing, to which several hon. Members, including the Chair of the Select Committee, referred. As I believe I said at the Select Committee, we share information from the WCA with the personal independence payment assessment process if someone is going through both of those, and we have done so in a significant number of cases. We will look at the evidence, but the initial indication is that that has enabled PIP decision makers to make decisions on paper without having to call somebody in for an unnecessary face-to-face assessment. That is our goal, because it is sensible to make such decisions on paper, without having to pull somebody in, where it is possible to do so.

The Chair of the Select Committee spoke about looking at other organisations, and her suggestion of using information from, for example, social care assessments is a sensible one. We ask those who apply for the benefit to produce the relevant information. I have asked officials to engage with colleagues in the Department of Health and the Department for Communities and Local Government to think about such ideas. In the new social care environment, more assessments will take place as a result of the new, consistent assessment criteria introduced by the Care Act 2014. I want us to think carefully about how we can do that sensibly, because we must not place an extra burden on local government or those who deliver social care. The general point is a good one, however. We do not want people to go through multiple assessments if we can share the necessary information.

I will hurry through one or two other points, because I am conscious of the fact that I need to give the Chair of the Select Committee a couple of minutes at the end of the debate to sum up. I have mentioned conditionality for JSA, which is relevant to the point that several hon. Members have made about what happens when people are found fit for work. When people are found fit for work, they are not entitled to ESA any more and they should claim jobseeker’s allowance. As I have said, however, work coaches have the ability to flex the claimant commitment so that it fully reflects somebody’s health condition or disability. If hon. Members have specific examples of where that is not happening, I want to know about them, so that we can investigate whether they were isolated incidents in Jobcentre Plus or whether there is a wider problem with training, information or communication. Several hon. Members asserted that there have been such problems, but I did not hear any specific examples. If hon. Members have such examples, I would like them to share those examples with me.

I am conscious, as ever, of the fact that time in the Chamber is short. I welcome the Select Committee’s work on ESA and the WCA. We agreed with several of the Committee’s recommendations, a number of which were very sensible. Some of them were things that we were working on, and some were things that we had not thought of. We made it clear where we did not agree. At the end of this month, Maximus will take over the delivery of the WCA from Atos. Maximus has experience in this area, and I know that it is keen to improve the experience of our constituents who go through the WCA. There may be some hiccups at the beginning, because that is inevitable when a big change occurs, but I am confident that we will deliver an improved level of customer service, which is important to everyone who has taken part in the debate.

Work-related Activity Group

Lord Harper Excerpts

Tuesday 3rd February 2015 Westminster Hall

[The Minister for Disabled People (Mr Mark Harper)]

It is a pleasure to serve under your chairmanship, Mr Sanders. I congratulate the hon. Member for Edinburgh East (Sheila Gilmore) on securing the debate and raising these important matters. I will come to her point about communication later, but there is common ground there, and I hope to update her on that. We may not agree about some of the policy changes, but it is very welcome that we agree that we should communicate clearly and put in place plans to improve communication.

I think that the hon. Lady acknowledged this in her speech, but to be clear, the policy intent of the work-related activity group, as well as that of employment and support allowance more generally, remains as it was when it was introduced by the Labour Government in 2008: to help people to return to work wherever that is possible. We know that there are generally health benefits from working and work-related activity.

The hon. Lady mentioned people with progressive conditions. I touched on this issue when Dr Litchfield published his final report. If they are arguing that the diagnosis of a progressive condition such as Parkinson’s or multiple sclerosis effectively means that someone should go into the support group, with the assumption being that they will probably never work again, some of the groups that represent those people should think about that, because it has a lot of consequences for how we treat people with progressive conditions. It kind of sends a message to employers that if someone gets diagnosed with one of those diseases, they should just be sacked because they cannot contribute anymore, even though some of those conditions are progressive over a long period of time. We have to think about how we treat people with those conditions.

Clearly, there will be a point in a progressive condition when someone is perhaps not able to work, and perhaps not able to work again, but we should not assume that the diagnosis of a progressive condition automatically means that someone in the support group is never able to return to work. That would send out some unhelpful messages that those groups—when they are not arguing about whether people qualify for benefits—do not themselves argue. They argue that people should be able to remain in the workplace while they can, and should be properly supported in that.

[Sheila Gilmore]

I point out to the Minister that the reason why people are claiming this benefit at all is that they have fallen out of the work force. Often they have been through a period with their former employer in which they were trying to stay in the work force. We are not necessarily dealing with people who will find it easy to work under any circumstances.

[Mr Harper]

I accept that point, but employers vary in their ability to deal with people with health conditions and disabilities. Some are better than others. For example, we know that some employers retain almost everyone in their organisation who develops a mental health problem, because the employers can deal with that effectively. Some employers, however, are not good at dealing with that. The only point I was making was that the diagnosis of a progressive condition should not mean that we automatically assume that the person will go into the support group. The other thing is that there are many conditions in which the symptoms fluctuate. It may be that someone has to have a more flexible work regime—sometimes they can work and sometimes they cannot. All I am saying is that it can be a little more complex, and a progressive condition should not automatically trigger a diagnosis-based referral to the support group.

[Dame Anne Begg]

There will be people in the support group who are or can be in work. The ability to work is not the correct definition for who should be in the support group and who should be in the WRAG group.

[Mr Harper]

I accept that point. There are of course people in the support group who do permitted work. I think that the hon. Member for Edinburgh East was arguing that it was somehow inappropriate for those diagnosed with progressive conditions to be put in the work-related activity group and expected to undertake some form of work-related activity. I was simply making the point that it does not follow that putting someone with a progressive condition in the WRAG is inappropriate, and that they should automatically be in the support group. That was the only point I was trying to make.

The hon. Member for Edinburgh East made a good and sensible point—she raised this at my Select Committee appearance last week, and I promised that I would respond to her—on some of the communication. Letters that say to people that they are not expected to return to work—I cannot remember whether it said “indefinitely” or “ever”—are not very well worded. We are looking at all our communication. We have a freeze on IT changes until we do the cutover from Atos to Maximus, but once that is out of the way, we will change the wording on the assessor recommendation. The hon. Lady made a good and reasonable point in the Select Committee session last week; the wording as set out does not accurately reflect the position.

The hon. Lady also raised the point about the work capability assessment generally. We will respond to Dr Litchfield’s report in due course, but he said that the WCA was not a perfect assessment, and I would not pretend that it was. He also made the point, however, that there is not a magic alternative assessment that can be pulled off the shelf. As the hon. Lady knows—I think she remarked on this in her speech—a number of experts looked at whether there was an alternative way of assessing people’s need for benefits and for support to move into the workplace, and there was not a magic solution there either. That demonstrated that the WCA is a pretty good assessment. I would not pretend that it is perfect, but it is probably the best that there is. One thing Dr Litchfield suggested is that we give the WCA a period of stability, so that it can settle down, rather than continuing to make changes to it on a permanent revolution basis.

The hon. Lady also discussed whether we should be able to refer people to the work-related activity group without a face-to-face assessment. As we said in our response to the report—I think this blends the two slightly contradictory points that she made—we should not have unnecessary face-to-face assessments. Decisions are made on the basis of the papers without a face-to-face assessment only if the decision maker believes that the information in front of them is clear and provides sufficient evidence to make a decision. The person about whom that decision is being made will not always agree with the outcome, which is why they can apply for a mandatory reconsideration, and if they do not agree with that, they can appeal.

In cases where the decision maker is clear that there is sufficient evidence to make a decision, having an unnecessary face-to-face assessment—an assessment that, in other cases, the hon. Lady is not a fan of—is not an enormous step forward. She will know from the statistics we publish that the average length of time to complete a mandatory reconsideration is 13 days, and we complete three quarters of them in 30 days; that is not an enormous barrier put in the way of someone having their case looked at again and then being able to appeal the decision if they think they need to.

[Sheila Gilmore]

I have certainly come across cases where the decision made on a paper-based assessment turned out not to have used all possible sources of information. That did not come to light until a later date, and that is one of my concerns about the process. People can be placed in a detrimental position, both financially and in terms of the conditionality they are expected to follow.

[Mr Harper]

I think the hon. Lady’s point, which is perfectly good, is that we need to ensure that we make accurate decisions using all the information, that we get the information in the first place, and that we have properly explained to the claimant what information we need. She is right that we should make those decisions accurately, but that does not in itself suggest that making those decisions on the papers is wrong where there is sufficient evidence to do so. Saying that everyone has to have a face-to-face assessment when there is sufficient evidence is not a good argument. The fact that there are some cases where someone might not have made a good decision does not in itself invalidate the system. It is inevitable; however brilliant the system, there will always be cases where someone does not agree with the outcome, and is successful either on a mandatory reconsideration or on an appeal.

The hon. Lady referred to the communications that we send out. In Dr Litchfield’s fourth review, he recommended that we look at all the key ESA letters and forms to ensure that they are in plain English. The main ESA50 form has been reviewed and will be issued later this month. The decision letters are on a later time frame. The ESA260 form, which notifies someone of the decision in the first place, was revised last October. I looked specifically at the point on contribution-based ESA and the time limit because I know she is concerned about that. If someone is getting contribution-based ESA, it is clear that that is what they are getting. It is clear that that is time-limited, and that the time limit does not apply if they are in the support group. We are starting to do that work, as Dr Litchfield recommended, to improve our communications. There is more to do on that, and the hon. Lady is right to highlight that.

On the Work programme, which the hon. Lady referred to, it matters what time period one looks at. It is perfectly fair to say that in the first year of the Work programme, only one in 24 of the people claiming ESA moved into work, but up to the end of June last year, one in 10 ESA claimants had had at least three months of work within the first 12 months of being on the Work programme, which is a considerable improvement on its initial period and above the minimum performance level of one in 14. We want to improve the one in 10 figure, but she should acknowledge that the Work programme has improved its performance for this group of claimants. It has got a lot better, but we want to continue to improve it.

On the specific case that the hon. Lady referred to, an employer should have dealt with adaptations and hours of work through reasonable adjustments. On the issue to do with support workers, people can get support through the Access to Work programme. It is about ensuring that someone who goes through the Work programme has—

[Mr Adrian Sanders (in the Chair)]

Order.

Oral Answers to Questions

Lord Harper Excerpts

Monday 26th January 2015 Commons Chamber

[Rehman Chishti (Gillingham and Rainham) (Con)]

8. What progress he has made on supporting people with a mental health condition to find work.

[The Minister for Disabled People (Mr Mark Harper)]

The Government are committed to helping people with mental health problems into work. We are piloting a number of innovative approaches to employment support for those with mental health problems, and the Access to Work mental health support service can help people with a mental health condition who are absent from work or who are finding it difficult to get back into work.

[Mark Menzies]

Mental health issues in Fylde are as serious as they are anywhere else, so what plans does the Minister have to support further people with mental health conditions throughout the Disability Confident campaign?

[Mr Harper]

I am pleased that my hon. Friend mentions the Disability Confident campaign. I have invited Members from both sides of the House to talk about Disability Confident at an event in the House on Wednesday. Specifically on mental health, I had the privilege last Thursday to visit the constituency of my hon. Friend the Member for Gloucester (Richard Graham) and to meet with the work coaches in the jobcentre and with those who have been on some of our pilot programmes to hear about the success we have had in encouraging people with a mental health problem to get back into work, or to avoid having one in the first place.

[Rehman Chishti]

Will the Minister join me in recognising the importance of the voluntary sector in helping those with mental health issues to get back into work? Organisations such as Relate in my constituency work tirelessly to improve mental health and provide vital counselling that allows people to get back into work and progress with their careers.

[Mr Harper]

I am happy to pay tribute to organisations such as the one my hon. Friend has just mentioned. The important thing is to have a proper partnership with Jobcentre Plus, voluntary and third-sector organisations, the NHS and employers working together to ensure that we stop people from falling out of work if they develop a mental health problem, and that they can get back into work if they do so.

[Stephen Pound (Ealing North) (Lab)]

I cannot be the only person in the House today who finds it utterly heartbreaking when people come to their surgery unable to find work. Those people are often more than capable of working but, because of a fear of stigmatisation and an absence of support, they are unable to find that work. I praise the hon. Member for Fylde (Mark Menzies) for setting an example in this area. Following on from the good work of Waitrose and Tesco, can we not do more in this House to set an example, because we are after all a major employer?

[Mr Harper]

The hon. Gentleman is right. One thing we are doing through our Disability Confident campaign is ensuring that employers are aware not only of those with physical disabilities but of those with mental health problems. There was, for a period, a statutory bar on Members of Parliament serving in this House in this respect. When I was in Opposition I challenged the then Justice Secretary on the matter, and this Government have now delivered change to ensure that we set a good example. We now say that if someone has a mental health problem, they are just as capable as anyone else to work both as a Member of Parliament and as staff in the House.

[Mr Speaker]

On that matter, the Minister of State wisely heeded the recommendation of the Speaker’s Conference on Parliamentary Representation, which enjoyed all-party support.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

Voluntary sector organisations working with the most vulnerable claimants are expressing concerns that people with mental illness are still over represented among those being sanctioned. Does the Minister accept that there is still a problem here, and what more can he do about it?

[Mr Harper]

Just before I answer the hon. Lady, let me say that I am happy to agree with you, Mr Speaker, that your conference showed great leadership, which we were happy to follow. I think that it is wise to acknowledge that from the Dispatch Box—[Laughter.] The Secretary of State says keep going. The hon. Lady makes a serious point about sanctioning. We have to make sure in the Department and Jobcentre Plus that if someone on employment and support allowance does not engage with the help they are given, we understand why they do not engage with it and then deliver proper support. Last week, when I was looking at the pilots, I was trying to see how we better engage with that mental health support to ensure that we give people the support both to stay in work, and to get back to work, if they have a mental health problem.

[Justin Tomlinson (North Swindon) (Con)]

I was delighted to welcome the Minister to the Olive Tree café which provides opportunities for more than 30 people to rebuild their confidence and skills. That has been achieved through a successful social enterprise. How can we share that best practice?

[Mr Harper]

My hon. Friend invited me to visit the Olive Tree café in his constituency on a day that I also spoke at a mindful employer event, which again focused on mental health, at the constituency of my hon. and learned Friend the Member for South Swindon (Mr Buckland). We can use our Disability Confident campaign to get those messages out there. My hon. Friend, by using the benefits of this House, has ensured that the message will be heard far and wide.

[Derek Twigg (Halton) (Lab)]

In the past year, a number of people have written to me who are finding it hard to stay in work because they are getting very poor support in the workplace, and sometimes they are having difficulty accessing mental health support. What discussions has the Minister had with employers and his colleagues in the Department of Health about how we can tackle that? If those people cannot stay in work and become unemployed, they may have difficulty getting back into work again.

[Mr Harper]

The hon. Gentleman makes a good point, to which I would say two things in reply. First, people who are in work can be referred to the Access to Work mental health support service, to get support delivered to them to enable them to stay in work. Secondly, the NHS now recognises that it has an important part to play here, and for the first time we have set out access requirements for mental health services, which will start this April.

[Mr John Leech (Manchester, Withington) (LD)]

Why is no help available to get people with mental health problems back on to employment and support allowance, when they have voluntarily come off ESA and gone on to jobseeker’s allowance, wrongly believing that they were fit to work, only to be sanctioned for failing to comply with their jobseeker’s agreement because of their mental illness?

[Mr Harper]

One of the things that our work coaches in the jobcentre are able to do is flex the claimant commitment people make according to the claimant’s health condition. What should happen in such cases is that, if the individual remains on JSA, their work coach can alter the conditions to deal with that. If the hon. Gentleman has specific examples where that has not happened, I would be delighted if he wrote to me so that we can look into those cases.

[Duncan Hames (Chippenham) (LD)]

Just at the time that many young people leave full-time education, those battling mental health problems are also having to navigate their transition from adolescent to adult mental health services. Is it not essential that those services are there to support them at the very time we are looking to them to embark on their working lives?

[Mr Harper]

My hon. Friend makes a good point, and we are doing several things in that respect. First, we are looking at properly joining up the education, health and care assessments people have at school and the disabled students’ allowance application made when they go to university. We are also working closely with the Department of Health to make sure that mental health services are properly integrated with the world of work.

[Philip Davies (Shipley) (Con)]

5. How many jobs were created in (a) Shipley constituency and (b) Yorkshire in 2014.

--- Later in debate ---

[Sheila Gilmore (Edinburgh East) (Lab)]

18. What recent assessment he has made of the reasons for changes in the number of employment and support allowance claimants.

[The Minister for Disabled People (Mr Mark Harper)]

Under this Government, the number of people in receipt of out-of-work benefits has fallen by 899,000, and there are 93,000 fewer people on incapacity benefit since May 2010.

[Sheila Gilmore]

I thank the Minister for that answer, but I think he is absolutely clear that the number of people on incapacity benefit who have been found unfit for work is far higher than the Department for Work and Pensions predicted. Is it not time that Ministers dropped the scrounger rhetoric and accepted that if people are to move back towards employment, they need real help and support?

[Mr Harper]

I do not know whom the hon. Lady has heard using that rhetoric, but it is certainly not me or members of this Government. [Interruption.] It is no good her waving at us. It may be reported like that in newspapers, but Ministers do not use that sort of language. I have been very clear that people who are able to go to work with the right support will receive employment and support allowance. I am sure she was listening to the long exchange we had earlier on mental health support. Half the people on ESA have a mental health problem. She will have heard me set out the considerable range of things we are doing to help them to get back into work.

[Kate Green (Stretford and Urmston) (Lab)]

Ministers are spending £8 billion more than planned on incapacity benefit and ESA because they cannot assess people quickly enough, they cannot reassess them, and the failing Work programme cannot get them into sustained employment. Even the Minister for Employment, the right hon. Member for Wirral West (Esther McVey), admitted a few moments ago that it is achieving a 90% failure rate. Now the Tories say that they want to cut £12 billion from social security spending, and disabled people are worried that they will be paying for this catalogue of Tory welfare failure. What reassurance can the Minister offer them?

[Mr Harper]

I listened carefully, but it is a bit rich for the hon. Lady to criticise the issues we had with the assessment process. There were issues with the assessment provider that her Government appointed, which is why we appointed a new contractor, Maximus, which will start work in March, and I am confident that that will improve the assessment process and get people back into work. Getting people back into work is how we will continue to reduce the benefits bill, which I remind her rose enormously when her party was in government.

--- Later in debate ---

[Sir David Amess (Southend West) (Con)]

T3. Will the Minister ask officials to look compassionately on benefits arrangements for people with mental health difficulties? So often, when these people are called for assessment, it is not obvious that they really do have problems.

[The Minister for Disabled People (Mr Mark Harper)]

My hon. Friend raises a good point. Of course, assessors are trained in assessing mental health problems and are particularly mindful of the fact that people with mental health problems often have a fluctuating condition that might not be apparent at the time of the assessment. Of course, we tell claimants that they can bring someone with them to support them during the assessment, if that would be beneficial.

[Rachel Reeves (Leeds West) (Lab)]

In 2011, the Secretary of State said that, by April 2014, 1 million people would be receiving universal credit. With delays and write-offs, that date has been and gone, so will he answer the question that my hon. Friend the Member for West Lancashire (Rosie Cooper) asked, but which was not answered, and give a guarantee to the House that he will meet his latest target of just 100,000 people receiving universal credit by May 2015?

--- Later in debate ---

[Mrs Mary Glindon (North Tyneside) (Lab)]

T2. Following my request for a rescheduled meeting about the independent living fund, the Minister kindly wrote to me on 15 January, but why did he make no reference to my request for a meeting and why did he refer me to post-ILF provision under Newcastle city council when my constituency is North Tyneside?

[Mr Harper]

My point was that the independent living fund has been meeting local authorities across the country to make sure that every local authority with somebody in it that has ILF is well aware of the support it is getting. My answer was saying that to make sure that the person was getting the support, a conversation with the local authority would be more productive than a question to me.

[Sir Nick Harvey (North Devon) (LD)]

T6. The Government have rightly tackled the long-standing chaos in the Child Support Agency, but attracted controversy with their new 4% admin charge on struggling parents with care when the other parent is not stepping up to the plate. What assessment have the Government made of the big drop-off in the number of parents using the Child Maintenance Service? Are absent parents magically paying up to avoid their charge or are parents with care being scared off to avoid theirs?

--- Later in debate ---

[Mr Marcus Jones (Nuneaton) (Con)]

Not all employers appreciate the social importance and value to the work force that employing disabled people can bring. What more are the Government doing to try to encourage employers to take on disabled people, and to help them into work?

[Mr Harper]

I think that our Disability Confident campaign has contributed to the fact that more than a quarter of a million extra disabled people have started work over the last year. I am also considering improvements that we can make to the Access to Work service, which plays an important role in helping people either to stay in work or to return to it.

[Susan Elan Jones (Clwyd South) (Lab)]

T9. The Secretary of State said that by the start of this year no one would wait more than 16 weeks for a personal independence payment assessment. Will he tell us whether that is the case—yes or no?

[Mr Harper]

As the hon. Lady will know, this Wednesday I shall publish some properly verified statistics. I shall also engage in a lengthy session before the Work and Pensions Committee, when I shall set out the facts in full, as I have been requested to do.

[David Mowat (Warrington South) (Con)]

The Independent Project Board, which was set up by the Office of Fair Trading, recently established that more than £8 billion-worth of private pension assets were subject to charges of between 2% and 3%. That makes it almost impossible for such schemes to grow. Will the Minister tell us what action he will take to deal with that?

Personal Independence Payments

Lord Harper Excerpts

Wednesday 21st January 2015 Westminster Hall

[The Minister for Disabled People (Mr Mark Harper)]

It is a great pleasure to serve under your chairmanship, Sir Roger. I congratulate the hon. Member for Erith and Thamesmead (Teresa Pearce) on securing the debate. In the time available, I will do my best to answer as many as possible of the questions that she and others asked.

A number of colleagues raised the issue of delays and statistics. I think that colleagues got the message that I gave before, because a number of them helpfully repeated it, about dealing with the delays that claimants have experienced. It was and remains the issue on which I am spending a lot of time, to ensure that we resolve it. Both I and officials have been working very hard to do so, as have both the assessment providers.

We have quadrupled the number of assessments cleared each month since January last year, and the number of people with a PIP claim in payment almost doubled between July and October. This morning, the Department has pre-announced that we will publish next Wednesday information on the number of PIP claims processed. I have written to the Chairman of the Work and Pensions Committee, the hon. Member for Aberdeen South (Dame Anne Begg), to inform her of that fact, and I will of course take the Committee through those key pieces of information on the day on which I give evidence.

The normal publication of clearance times and outstanding case times, which we pre-announced in December, will take place in March, and the exact date will be pre-announced in the usual way. That will be the publication of the normal set of statistics, which will then take place on a regular basis. However, there will be an ad hoc publication next week, so that my conversation with the Select Committee will be informed by properly verified statistical information, which I think will be helpful, rather than unverified management information. As I said, I have written to the Chairman of the Committee this morning to let her know.

Hon. Members referred to the impact of the delays. It is worth making the point that PIP is designed to meet the extra costs of someone’s disability or health condition; it is not a benefit designed to meet normal day-to-day costs. In this and other debates, hon. Members have sometimes talked about someone who has had to leave work because of their health condition. PIP is obviously not designed to deal with the costs of that. Those costs will be dealt with by other benefits—for example, employment and support allowance.

All new claims for PIP are backdated to the date of the claim. I recognise, of course, that that presents a cash-flow problem for people, which is why we are working hard to deal with the delays. Of course, in the case of all reassessed claims, people will continue to receive their DLA while awaiting the PIP decision. Other support, which is not tied to receipt of PIP, is available for those on a low income. I am talking about help with energy bills, concessionary bus passes and help with NHS transport costs; and there is the ability to get a blue badge through an assessment, rather than being passported through PIP. Carer’s allowance can be backdated to the point from which PIP was awarded, as well. Again, I recognise that there is a cash-flow issue there, but people are able to backdate the costs.

I thank Paul Gray very much for his report. He did a thorough job. He talked to the assessment providers, to a lot of people who have had experience of claiming the benefit and those who have assisted them, and to many organisations involved in the process. It is a thorough report, and we will of course respond to it in due course. I can say some things today, because some of the recommendations are about things that are already under way. For example, we are reviewing and rewriting all the letters to claimants to make them simpler, easier to understand and clearer. We are also exploring the use of other medical evidence held by the Department. For example—this relates to a question asked by both the hon. Member for Erith and Thamesmead and the shadow Minister, the hon. Member for Stretford and Urmston (Kate Green)—if someone has gone through a work capability assessment and we have an ESA85 report from that assessment, we are using that information to support and help inform the decision to award PIP. Sometimes that will enable us to make a decision without a face-to-face assessment. It may mean that we have enough information to make those decisions on paper—it is obviously welcome if we can do that—or it may help to inform the decision, so we are looking at doing that.

We are looking at using more proactive communications. For example, since last April claimants get a text message to confirm that their form has been received, so that they know that it is in process. We are also building better relationships between the DWP case managers who make decisions and the health care professionals who make assessments.

We have made changes to some of our internal processes and IT to further streamline clearances of claims. We have improved communications to claimants at the beginning, to try to ensure that they know what the best evidence to supply is and how long their claim may take to be assessed, and to stress the importance of sending us information and following the process. We have a dedicated customer claim line for terminally ill claimants. The assessment providers are also providing claimants with better information about how long a claim may take and whom they should contact at each stage of the process.

As a number of hon. Members mentioned, including the hon. Member for Edinburgh North and Leith (Mark Lazarowicz), there is a fast-track service and a dedicated claim line for terminally ill claimants with a prognosis of six months or less. We are clearing those cases in about 10 days, which is in line with expectations, and 99% of the decisions lead to an award. In the review, Paul Gray acknowledged that the process for terminally ill claimants had significantly improved following the work that the Department and my predecessor did with Macmillan Cancer Support.

[Mark Lazarowicz]

I hear what the Minister says, and perhaps he will come to this later, but what about the situation that I described of people whose prognosis is more than six months but still relatively short, who will be hit badly when there are delays of much more than 16 weeks?

[Mr Harper]

The hon. Gentleman makes a perfectly sensible point. The solution is to fix things so that people are not having to wait so long. Clearly, we have to state a time. People have various health conditions and disabilities, and we have to draw a line somewhere, but the real solution for the cases that the hon. Gentleman mentions is to do what we are doing, which is to ensure that people going through the process have an assessment within a sensible time. Then the issue that he set out simply does not arise, because they are getting an assessment, a relatively speedy decision and the support that they need. That is the solution for those with a progressive condition, with a longer prognosis, but obviously for those with a terminal illness who have a very short time to live, we have put in place a much faster process, which is working well.

The hon. Member for Erith and Thamesmead mentioned interventions. The point of them is to ensure that the amount of PIP paid is correct, so that awards can be adjusted upwards if someone’s needs have increased or downwards if they have decreased. That has happened in a very small volume of cases to date. The hon. Lady gave a specific example of one of her constituents. Interventions are set on the basis of when needs change and when awards are made. Given that interventions can go in both directions, it is certainly not in the interests of the Department to review awards more frequently than is necessary, because to do so creates unnecessary work.

The hon. Lady mentioned reassessment. There are two kinds of reassessment going on. For those who have time-limited awards, there is a process called natural reassessment—the names are not brilliantly informative—which is being switched on only in areas where we know that we have the capacity to carry it out. One of the things that I do before I take those decisions is to ensure that our assessment providers have the necessary capacity, and I have been switching the process on only when where there is that capacity.

The hon. Lady mentioned managed reassessment, which has previously been announced as starting in October, under which those with an indefinite DLA claim will be reassessed. We have made it clear that we will roll that out only where and when we have the capacity to do so. It is clearly not in our interest to start reassessing people if the system does not have the capacity to do so. By the way, I thank the hon. Member for Edinburgh North and Leith for his positive comments about DWP staff and staff in my private office, where he has had to raise issues. People do not often say nice things, so I acknowledge his comments on behalf of the Department.

Colleagues from Northern Ireland raised a number of matters. The hon. Members for Strangford (Jim Shannon), for East Londonderry (Mr Campbell) and for Foyle (Mark Durkan) talked about the Stormont House agreement. I have been in correspondence with Mervyn Storey, the Minister with responsibility for welfare in Northern Ireland, and he and I are trying to get a date in the diary to meet. One thing that we will talk about is the progress that has been made on the Stormont House agreement and welfare reform. I am sure that we will both want to talk about the lessons learned from rolling out PIP in Great Britain, which may apply to the roll-out in Northern Ireland.

[Jim Shannon]

I understand that relevant measures will be going through the Northern Ireland Assembly during the next fortnight, so the implementation in Northern Ireland will be in place in time for the Minister’s meeting with Mervyn Storey.

[Mr Harper]

The hon. Gentleman makes a good point. There are two issues: the legislative process—I take his word about the timetable for that—and the implementation and operational matters. The Department and I will provide every assistance to the Northern Ireland Executive to make sure that that goes smoothly. It is worth putting on record—

[Mark Durkan]

Will the Minister give way?

[Mr Harper]

Let me finish my comment, which is about a point that the hon. Member for Foyle raised. The Stormont House agreement states that although the Northern Ireland Executive normally legislate on welfare on a parity basis with Great Britain, they can deviate from parity, partly to recognise the history of Northern Ireland and some of the specific issues that apply. However, the agreement also states that the cost of deviations from parity with Great Britain must be met from the existing Northern Ireland budget. The hon. Gentleman set that out, and I wanted to put that on the record to clarify the position. The Northern Ireland Executive can deviate from the normal process when they legislate to deliver the operational effect.

[Mark Durkan]

Of course, there have historically been some differences in delivery, even within the parity regime, on matters such as housing benefit. When the Minister meets Mervyn Storey, will he ensure that he, as the Whitehall Minister, says nothing to disturb our working assumption that much of the room that we thought would have to be made up from the Executive’s block grant is available to us within our spending remit under the welfare cap? That cap is not really biting at the moment, but it may do so in the future. Can he assure us that our assumptions about not having to rely so much on the block grant, and on the rest of the Executive’s budget grant, will not be disturbed by any meeting that he has with the devolved Minister?

[Mr Harper]

I will certainly make sure that the meetings I have with the Minister are helpful. The hon. Members for Banff and Buchan (Dr Whiteford) and for Edinburgh North and Leith mentioned the Smith commission, which is relevant to the conversations in Northern Ireland and in Scotland. It may not be far in the future, but I cannot anticipate the Government’s comprehensive response to the report published by the Smith commission, for which hon. Members will have to wait patiently a little longer. It is worth saying that we have to be careful, because Ministers have to follow current legislation. All that has been announced in the Smith commission report is what will happen in the future. The Government have made commitments, but no legislation has yet been introduced. When legislation is introduced, the Scottish Government will have to decide what they will do, and our conversation today makes it clear that we will have to think about operational delivery. Ministers have to proceed on the basis of the current law.

[Dr Whiteford]

The point I was trying to make was that in looking forward—obviously, we do not know what is in the proposals—the Government’s evaluation of the current policy is important to inform any future decisions made elsewhere.

[Mr Harper]

I take that point, and Paul Gray’s review will partly inform that. If there are lessons to be learned about implementation when the proposals are published and changes are made, I am sure that officials in my Department and Ministers in the UK Government will want to work in partnership with Ministers and officials in the Scottish Government to ensure that things proceed smoothly. We will publish the response to the Smith commission in the not-too-distant future. As Members have said, a commitment has been made to do so by 25 January. I want to put on record that we will proceed on the basis of existing law.

The hon. Member for Foyle mentioned children. There are no plans to extend PIP to children; we have always said that we wanted to see how PIP for adults worked. If a decision was made to extend PIP to children—I emphasise that there are no plans to do so—it would be subject to consultation and to the affirmative procedure in Parliament, so both Houses would have to be involved in that decision. The hon. Gentleman is right to say that primary legislation would not be required, but parliamentary procedures would have to be followed.

On the question of the transition from DLA for young people, which the hon. Member for Stretford and Urmston mentioned, people cannot claim PIP until their 16th birthday, but we contact people in advance to enable them to prepare and, as she said, to see whether the child needs an appointee to help them through the process. She asked some specific questions, following up on her earlier written question. I will look at the Hansard report of the debate and, if she is content for me to do so, I will write to her and place a copy of the reply in the Library, which I hope will help colleagues.

In summary, I have made it clear that delays, which several hon. Members have touched on, are unacceptable. The Department and providers have been working hard to deal with them. The hon. Member for Erith and Thamesmead mentioned that I will be giving evidence to the Work and Pensions Committee next week—I am looking forward to that, as is she—on a number of issues, including PIP. I will be happy to explain the progress that we have made. We will publish properly verified statistics to make sure that that is an informed discussion.

We have welcomed the Gray review. I have said a little about some of the areas in which we are already working on it, and we will publish a full response. I think I have answered seven of the nine questions asked by the hon. Member for Erith and Thamesmead—we will cover the two that I did not answer in our full response to Paul Gray’s review, which we will deliver in due course. I think I have touched on all the questions that hon. Members have asked. The debate has been helpful, and I am grateful to the hon. Lady for securing it.

[Sir Roger Gale (in the Chair)]

Order. Before I call Mr McKenzie to open the next debate, the Chair has not been notified, but there appears to be a change of Minister. Is that correct?

Industrial Injuries Advisory Council (Triennial Review)

Lord Harper Excerpts

Friday 16th January 2015 Written Statements

[The Minister for Disabled People (Mr Mark Harper)]

Triennial reviews of non-departmental public bodies are part of the Government’s commitment to ensuring accountability in public life. Today I am launching a review of the Industrial Injuries Advisory Council (IIAC). On the grounds of proportionality I have combined this review with that required of IIAC as a scientific advisory committee. The review will examine the Council’s functions, efficiency and governance procedures. The review is due to be completed in March 2015 and I shall inform the House of its outcome.

[HCWS197]