Guaranteed Minimum Pensions Increase Order 2023

Viscount Younger of Leckie Excerpts

Wednesday 22nd February 2023 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Guaranteed Minimum Pensions Increase Order 2023.

Motion agreed.

Social Security Benefits Up-rating Order 2023

Viscount Younger of Leckie Excerpts

Wednesday 22nd February 2023 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Social Security Benefits Up-rating Order 2023.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, I shall speak also to the draft Benefit Cap (Annual Limit) (Amendment) Regulations 2023 and the draft Guaranteed Minimum Pensions Increase Order 2023. All three draft instruments relate to the way in which pension and benefit rates are increased, and in my view the provisions of all three are compatible with the European Convention on Human Rights.

The Social Security Benefits Up-rating Order increases state pensions and benefits by 10.1% from April 2023, in line with the increase in the consumer prices index in the year to September 2022. The draft Benefit Cap (Annual Limit) (Amendment) Regulations also increase the four benefit cap levels by 10.1% in April 2023, in line with the increase in benefit rates. The Guaranteed Minimum Pensions Increase Order sets out the annual percentage by which the relevant part of an individual’s contracted-out occupational pension must be increased. The relevant part is the guaranteed minimum pension that was earned between 1988 and 1997. Occupational pension schemes are required to increase these, where they are in payment, by 3% for the tax year 2023-24.

By way of history and context, the Committee will know that inflation in the year to September has been the conventional measure used by Governments since 1987 in reaching a decision on how to increase the rates of state pensions and benefits. This is the latest figure that can be used to allow for the necessary operational and IT changes to be made across the DWP, HMRC and local authorities so that the new rates can come into force the following April.

This year, more than ever, it is imperative that these rates are increased so that we protect pensioners and people on low incomes. Putin’s illegal war in Ukraine and two years of a global pandemic mean that we and our partners across the G7 face levels of price inflation unprecedented in recent times. Strategically, the Prime Minister has made clear his commitment to halve the level of inflation this year, and on 9 February the Governor of the Bank of England told the Treasury Select Committee that he expects inflation to fall rapidly this year to somewhere below 5%.

More immediately, the draft uprating order ensures that state pensions and benefits keep pace with the increase in the cost of goods and services over the longer term. For this year’s uprating, the September CPI figure of 10.1% is forecast to be higher than actual inflation in the following year, but this follows two years where the opposite has been true. Using a consistent index ensures that these fluctuations even out so that state pensions and benefits retain their purchasing power over time.

In the shorter term, the Government acknowledge that further help is needed alongside the twin longer-term strategies of bearing down on inflation and uprating benefits consistently over time. The Government are therefore making provision for further cost of living payments in addition to the annual uprating. I will say more about these payments later, which I am sure the Committee realises are already well-rehearsed in this House.

Let us turn now to the detail of the draft Social Security Benefits Up-rating Order 2023. First, on state pensions, due to the Government’s commitment to the triple lock for 2023-24, the basic and new state pension will be uprated by the highest of earnings, prices or 2.5%. Consequently, as the increase in prices is the highest, state pensions will increase by September’s CPI of 10.1% for 2023-24. As a result, from April 2023 the full basic state pension will increase to £156.20 per week for an individual. The full rate of the new state pension will increase to £203.85 a week.

Other components of people’s state pension awards, such as those previously built under earnings-related state pension schemes, including the additional state pension, will also increase by 10.1%. The safety net for pensioners on low incomes, which is the pension credit standard minimum guarantee, will also increase by 10.1%, rising to £201.05 for a single pensioner and £306.85 a week for a couple.

I know that the take-up of pension credit is a matter of particular interest across the House and to members of this Committee. Noble Lords raised the matter on several occasions with my predecessor and noble friend, Lady Stedman-Scott. I thought I might share the latest position to be helpful to the Committee. Since April 2022, the Government have undertaken a substantial and sustained communications campaign to raise awareness of pension credit and to promote take-up. Since the awareness campaign began, weekly pension credit applications are on average 73% higher compared to the year before. Noble Lords will also be encouraged to learn that the latest statistics show that more households were in receipt of pension credit in August 2022 than in May 2022. This is despite the fact that the eligible population for pension credit is declining, as the new state pension lifts more pensioners above the basic level of the means test.

For those below state pension age, this order increases the personal and standard allowances of benefits, including universal credit. Noble Lords will be aware that there is no statutory requirement for the Secretary of State to increase these rates. However, to protect the most vulnerable in the current economic situation, he has decided to increase them by 10.1%, in line with the consumer prices index in the year to September 2022.

The monthly amounts of universal credit work allowances, which is the amount that a person with children or limited capability for work can earn before their universal credit payment is affected, will also increase in April by 10.1%. This too is a discretionary decision on the part of the Secretary of State. For those eligible for a work allowance who are receiving support with housing costs, the allowance will increase to £379 per month. For those eligible for a work allowance who are not receiving support for housing costs, it will increase to £631 per month.

Additionally, the order increases statutory payments by 10.1%. These include statutory adoption pay, statutory maternity pay, statutory paternity pay, statutory shared parental pay, statutory parental bereavement pay and statutory sick pay.

Turning to another important area, that of disability and carer’s benefits, the Government will continue to ensure that carers and people who face additional costs because of their disability get the support that they need. The Government recognise the vital role that unpaid carers play, and carer’s allowance will increase from April by 10.1% to £76.75 per week. Unpaid carers may also access support through universal credit, pension credit and housing benefit, all of which include additional amounts for carers.

For a single person, the carer element in universal credit will increase to £185.86 a month from April, while the additional amount for carers in pension credit and the carer premium in other income-related benefits will increase to £42.75 a week. Benefits for those who have additional costs as a result of disability or health conditions will also increase by 10.1%. These include disability living allowance, attendance allowance and PIP—the personal independence payment.

I turn to the draft Benefit Cap (Annual Limit) (Amendment) Regulations, which will also increase each of the four benefit cap levels by 10.1%. This will ensure that all households see an increase in their benefit following uprating. The national benefit cap levels will be £22,020 a year for couples and lone parents, and £14,753 for single people. For households living in Greater London the levels will be £25,323 a year for couples and lone parents, and £16,967 for single people. Just to put this in perspective, it means that households will be able to receive benefits up to the equivalent gross earnings value of around £26,500, or £31,300 in London.

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When politicians play fast and loose with benefits uprating, the results are felt in lives that are blighted. There are already 4 million children in poverty. Only a few weeks ago, the Joseph Rowntree Foundation reckoned that one in seven families was going without essentials. We are now coming up towards one-fifth of pensioners living in poverty—that figure is much higher than when Labour left office—with older and disabled pensioners being the most affected. Can the Minister tell us whether the Government have a strategy to deal with growing poverty among the young and the old in our society? I look forward to his reply.

[Viscount Younger of Leckie (Con)]

My Lords, I start by thanking the Committee in general for its overall support for these regulations. I also thank various Peers, including the noble Baroness, Lady Lister, and the noble Lord, Lord Davies, who made some very kind remarks about me coming into this particular role; I appreciate it. I was more than prepared for the fact that a good number of questions would arise from these regulations, of which there are three; I will of course do my best to answer them.

Let me start, in what I hope is not too discordant a way, by taking some issue with what the noble Baroness, Lady Sherlock, said. There is no question that there is no way in which we have played fast and loose with this; that is a bit unfair. A huge amount of thought has gone into this. I think the Committee has acknowledged that we have moved in the right direction by raising many of these benefits by 10.1%.

[Baroness Sherlock (Lab)]

Let me just clarify: I was not suggesting that the Government played fast and loose this year. I was talking about previous years when they broke with uprating and did not uprate at all, not this year. I am sorry if I did not make that clear.

[Viscount Younger of Leckie (Con)]

That is fine; I accept that. I think we can leave it at that.

I will start by tackling a couple of issues that were raised by the noble Baroness, Lady Sherlock, towards the end of her speech. She made some good points that completely chime with what the Government think. We totally understand that a number of individuals are suffering as a result of the war in Ukraine, the pandemic and cost of living issues generally. I completely acknowledge that; I hope the Committee understands that.

Let me start on why childcare has not been included; perhaps I can help. Regardless of the number of hours that they work, eligible parents can claim back up to a generous 85% of their childcare costs each month, up to the maximum amount of £646 for one child and £1,108 for two or more children. The vast majority of UC claimants receiving a childcare element do not hit the UC childcare caps. In fact, between August 2020 and July 2021, 92% of universal credit claimants receiving a payment for the UC childcare element were eligible to receive the full 85% of their childcare before the earnings taper.

So we believe that our policy provides fairness in the welfare system between those receiving out-of-work benefits and those in work by putting in place a reasonable cap on the childcare costs that a household can have reimbursed through UC, in each assessment period. We believe that the childcare policy aligns with the wider government free childcare offer in England and our similar funded early learning offers in the devolved nations. We keep childcare under review. We know that childcare costs are extremely high; I am certainly aware of that. I cannot add anything more to that, only that the Committee should be aware that we are aware of these issues. I will stick with that.

Secondly, the noble Baroness, Lady Sherlock, raised a perfectly reasonable point about food back usage. I am aware from a previous Oral Question in the Chamber of various Peers’ strong concerns and the comments that have been made. I chime with those as well. As the noble Baroness knows, food banks are independent, charitable organisations and our department does not have a role in their operation. What she and the Committee should know is that we are looking to give some feedback from a series of questions posed by the Family Resources Survey. We hope that these will be published next month and will give the Government some idea about usage. It is very much our wish that food banks are not needed. We need to continue to work as hard as we can to look at the reasons behind their usage. We can all guess what they are; I have given some flavour of that this afternoon.

On the same theme, I will touch on inflation. This leads to a number of important points raised by noble Lords, in particular the extremely good point from the noble Baroness, Lady Lister, on the increase in food prices. We are all concerned about the price of certain food items rising particularly steeply. Like many countries around the world, and as the noble Baroness knows, the UK faces the challenge of high inflation. We will continue to provide support through cost of living payments, which have been well rehearsed in this Committee and in the Chamber, while increasing state pensions, benefits and the benefit cap levels by 10.1%.

To help the Committee, the CPI stood at 10.1% for the 12 months to January 2023, down from 10.5% in December. This monthly decline was principally driven by lower rises in motor fuel. The Bank of England predicts that the CPI will continue to fall. The OBR states that government action has limited the severity of the recession and protected 70,000 jobs, and that it will take 3.4 percentage points off inflation by the end of March. This will contribute to a fall in inflation, which, as the Prime Minister has said, is expected by mid-year.

This leads quite neatly on to some of the points raised by the noble Baroness, Lady Lister, and the noble Lord, Lord Davies. To paraphrase, the general gist of their question was: why can we not uprate more frequently using a more up-to-date CPI figure? That is a fairly reasonable question. The Secretary of State undertakes an annual review of benefits and pensions. As I mentioned earlier, the CPI in the year to September is the latest figure that the Secretary of State can use. This is crucial to allow sufficient time for the required operational changes before new rates can be introduced at the start of a new financial year.

All benefit uprating since April 1987 has been based on this particular timing. Given the volumes involved, the technical and legislative requirements and the interdependencies across government, we state very firmly that it is not possible to undertake the uprating exercise any later than currently timetabled. I do not say this to be particularly cheeky but I wonder whether the comments might not have been quite so critical of this timing issue for the higher uprated figure had there been real evidence today of a much lower level of inflation, so all those people would be getting more than the level of inflation—perhaps I should not go there.

I turn to the local housing allowance—the LHA—which was raised by the noble Baroness, Lady Lister, and others; yes, we had 10 minutes on this in the Chamber earlier. I am not sure that I can really add to what I have said. I genuinely believe that the £1 billion that we invested in 2020 to provide support for private renters by increasing the rate to the 30th percentile was the right thing to do. It is a fact that it has been frozen but it is also a fact that the discretionary housing payments—DHPs—and homelessness protection grants are helpful. I say again that we believe it is right that we defer to local councils and local authorities to make the right decisions in terms of how to target the funds that we have given them, including to people who are generally suffering and are on the lowest incomes. It is up to them to decide what to do.

[Baroness Lister of Burtersett (Lab)]

Perhaps I can ask again the question that I asked this afternoon but in a slightly different way. Let us take somebody whose local housing allowance is well below the rent that they are paying and they are on benefits. They are probably struggling anyway because, as we have heard, benefits have been cut in real terms in recent years—if benefits had not been cut since 2010, people might have been in a better position that they are to withstand the current cost of living crisis. Let us say that they also live in an authority where the local housing allowance budget is under great strain; according to Shelter, some authorities are really struggling because demand is so high. What is the Minister’s advice to them? What should they do? There is no point saying, “Go to the local authority”, because there may not be any money there.

[Viscount Younger of Leckie (Con)]

I take note of that; I am certainly not dismissing what the noble Baroness says. It is a legitimate point that she raises. I hope, though, that she will acknowledge that it is right that the money we give is properly targeted to those who are in genuine need. I would like to hear of issues where they are not particularly targeted. If the money is going to people who do not need it, that is an issue, but the main thing is that the money should go to people who are genuinely in need. However, it does not just rely upon that; it relies upon the other initiatives that I have already mentioned.

To pick up on what the noble Baroness said in her remarks, the local housing allowance rates are not intended to meet all rents in all areas. In areas where rents are more expensive, those in receipt of benefits have to make the same decisions about where to live as those not claiming benefits. May I just leave it that we probably will not agree on this and that I will take away what the noble Baroness has said? It is important, I acknowledge, that local authorities follow through and give support to those who are in genuine need in all areas.

I will move on to the transitional element—that is, the uprating and the link to universal credit and transitional protection, which was raised by the noble Baroness, Lady Lister, and the noble Lord, Lord Davies. As they know, TP provides eligible claimants time to adapt to UC by protecting entitlement at the point of migration to universal credit. TP is neither intended to replicate permanently nor be an indefinite increase in benefits. I therefore acknowledge that it erodes. This ensures that UC entitlement for those managed migrations will gradually align with new claimants in the same circumstances. The noble Lord, Lord Davies, asked how many people will see a less than 10.1% increase due to the interaction with transitional protection; I will need to write to him on that point.

[Baroness Lister of Burtersett (Lab)]

I asked that question as well. Will the Minister write to me about how many will be affected? I had hoped that he might be able to bring those figures today.

[Viscount Younger of Leckie (Con)]

If I had been given advance notice of the questions, I might have been able to.

[Baroness Lister of Burtersett (Lab)]

The noble Viscount was. I am sorry but the very reason I raised it with him earlier this week was so that it might be possible to bring the figures today.

[Viscount Younger of Leckie (Con)]

In which case, I apologise. I would normally take note and come back with some answers. Of course I will include the noble Baroness; in fact, I will include any Peer who has taken part in this debate in my letters about anything that I am not able to answer.

The noble Lord, Lord Davies, and the noble Baroness, Lady Sherlock, said that the Government need to be clear about why we are raising the guaranteed minimum pensions by 3%. For the pre-2016 pensioners, the Government meet the difference; for post-2016 pensioners, we do not—however, these people benefit from transitional protection. I hope that gives some form of an answer.

The noble Baroness, Lady Sherlock, raised communication. A fact sheet covering the policy change was published on GOV.UK in August 2021—I see that she is nodding at that—which invited people to write to the department if they wanted an explanation of how they had been affected by the policy change. One request for compensation has been received so far, which is interesting. As of 25 January, we do not yet know the outcome of that claim, but I hope that provides an answer.

The noble Baroness also asked about the benefit cap increase linked to child poverty. As she will know, the Government are fully focused on tackling the root causes of poverty, such as children’s education and parental worklessness, to improve the lives of people in our country. She will know that the best way of doing that is for us to have a strong economy and get people into work. As mentioned earlier, the proposed levels will mean that households will be able to receive benefits up to the value of gross earnings of around £26,500, or £31,300 in London.

The noble Baroness, Lady Lister, asked about low pay and whether the Low Pay Commission—the LPC—would include in its deliberations the adequacy of benefit rates. I thank the noble Baroness and will draw the Treasury’s attention to that.

There are a number of other questions that I need to answer, but we probably need to draw a halt, as time is running short.

[Baroness Janke (LD)]

Please can I have some answers to my questions, perhaps in writing?

[Viscount Younger of Leckie (Con)]

Yes, of course. To conclude, I beg to move.

Motion agreed.

Local Housing Allowance Rates

Viscount Younger of Leckie Excerpts

Wednesday 22nd February 2023 Lords Chamber

[Baroness Lister of Burtersett]

To ask His Majesty’s Government what assessment they have made of the impact of the freeze in local housing allowance rates.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, the local housing allowance policy is kept under regular review. We monitor the average rents and shortfall levels for claimants to assess the impact of the policy. A significant support package was announced in the autumn Budget, including uprating benefits by 10.1% and extending the household support fund for 2023-24. Further support—discretionary housing payments—is available, and since 2011, nearly £1.6 billion in DHPs have been provided to local authorities.

[Baroness Lister of Burtersett (Lab)]

My Lords, according to the Institute for Fiscal Studies, this further freeze in private rental support means that two-thirds of lower-income private renters must cover at least a quarter of their rent from elsewhere. For many, this means a real cut in the value of inadequate benefits that are supposed to cover basic needs such as food. Cash-limited local authority discretionary housing payments are no answer, especially as their budgets have also been cut. Does the Minister accept that one consequence of this freeze is likely to be increased homelessness? What is his advice for those faced with a growing, unaffordable gap between help with housing costs and actual rents?

[Viscount Younger of Leckie (Con)]

I absolutely hear the noble Baroness, because we recognise that rents are increasing—there is certainly lots of anecdotal evidence of that in the press. However, the challenging fiscal environment means that difficult decisions were necessary to ensure that support is targeted effectively. That is why the Chancellor announced at the Autumn Statement a substantial package of cost of living support to target the most vulnerable households. As I mentioned earlier, one of the initiatives for those who require additional support is the discretionary housing payments available from local authorities, which are best able to target those funds.

[Baroness Thornhill (LD)]

My Lords, the overall level of housing benefit indeed remains a difficult political decision. However, does the Minister agree that it is the way the current local housing allowance system is structured that produces such an arbitrary and unfair system, particularly for private sector renters in high-rent areas? In the face of such overwhelming IFS evidence to prove this, are the Government giving any consideration to reframing the way that housing benefit is calculated in order to remove this growing unfairness?

[Viscount Younger of Leckie (Con)]

Again, I note the comments made by the noble Baroness. We are very aware of this, and we are aware of the juxtaposition of what central government can do and the role of local authorities. As I said earlier to the noble Baroness, Lady Lister, local authorities are best placed to understand exactly where the funds that we give them are best targeted. However, there is more than that; I mentioned the discretionary housing payments, but we also have the household support fund. There are a number of other initiatives which are important to mention as regards helping people, particularly to stay in their homes.

[Lord Naseby (Con)]

I accept what my noble friend says about the Autumn Statement, but is there not one sector of the public who are particularly badly affected? That is the people who are unfortunately unemployed and who are totally dependent on the local housing allowance and therefore disadvantaged, according to the local authorities that I have checked with.

[Viscount Younger of Leckie (Con)]

Yes, indeed, and this plays into what we spend a lot of time doing in our department, which is looking at universal credit and the benefit cap, including the need for housing. We therefore recognise the importance of safeguarding the welfare of claimants, particularly those who, I am afraid, have got into debt. Looking at how they are able to afford housing is a key part of that.

[Lord Whitty (Lab)]

My Lords, in the light of the rise in rents in the private sector, the likely rise in local authority rents and other social housing and the inadequacy of the local housing allowance to make good that, what is the Government’s estimate of the number of evictions that are likely to take place in both the public and private sector—that is in both social and private sector housing?

[Viscount Younger of Leckie (Con)]

I certainly do not have an estimate of what the evictions will be, but we are very aware of the pressures around and we focus on the homelessness prevention grant, which is given out. That is to ensure that people are not evicted from their homes. It is very important that we do whatever we can to support people with their houses, particularly in areas where there is the greatest pressure, and the homelessness prevention grant will help as an extra comfort blanket for that.

[Lord Carrington (CB)]

My Lords, what proportion of people receiving the local housing allowance are unemployed and therefore heavily dependent on this money to pay their rent?

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[Viscount Younger of Leckie (Con)]

Although I do not have that particular figure—perhaps it would come from local authorities—I will certainly be very happy to write to the noble Lord with that information.

[Baroness Sherlock (Lab)]

My Lords, let us try to understand the system. The Government set up a system where you were meant to be able to rent one of the cheapest 30% of properties in an area on the local housing allowance rate and then they froze those rates in cash terms while rents kept going up. That forces people on low incomes to compete for fewer and fewer properties in their local area. This is not at the margins. Roughly 1.5 million people on universal credit get the housing allowance. Over half of those are having to top up their rents by an average of £100 a week. The inflationary increase that the Minister mentioned for the adult allowance on universal credit was a top-up of £100 a month, but £34 extra a month is coming in. How does that work?

[Viscount Younger of Leckie (Con)]

The noble Baroness might like to be reminded that the LHA was originally set at 50th percentile of local market rents and then the policy was reformed, as she will know, in 2011, when it was reduced to 30th percentile. The reforms were made for a reason, because the scheme was unsustainable, with excessively high LHA rates in some areas. Having said all that, we are very aware of the pressures at the moment, as I said earlier, and that is why we have other initiatives to help those who are really struggling— I acknowledge that they are—in some cases with their housing costs.

[Lord Young of Cookham (Con)]

My noble friend has mentioned several times discretionary housing grants, which are available to top up the difference between the local housing allowance and rents. Should not more be done to make those better publicised and if, as the noble Baroness said, there is pressure on the local authorities that have these grants available, would it not be more economical to top up the discretionary housing grants for local authorities if the Government are unable to review local housing allowances?

[Viscount Younger of Leckie (Con)]

Yes. My noble friend makes a good point, and it may well be that better communication is required. I will certainly look into that. However, local authorities, as I said earlier, have broad discretion to spend in line with their local priorities, supported by the non-statutory guidance provided by my department. That provides a list, crucially, of priority groups to assist with their decision-making. Obviously, that needs to be informed perhaps by better communication in terms of where the needs are. There is no evidence that it is not working, but I will look at that.

[Baroness Janke (LD)]

My Lords, there is evidence that the freezing of the local housing allowance affects families most severely, particularly those subject to the benefit cap and, most particularly, lone families. In his reply to the noble Baroness, Lady Lister, the noble Viscount mentioned the importance of targeting resources where they are needed. How can he justify this policy given that we know what the effect will be?

[Viscount Younger of Leckie (Con)]

I would answer that by saying that it is not a question of justifying it but of looking at the whole way in which we are helping people at the moment. That is why it is worth reminding the noble Baroness that, for example, working-age and disability benefits will increase by 10.1% in 2023-24, which I will be speaking to later in the Moses Room. In addition, the benefit cap will be increased in line with CPI. We understand the pressures that people are under and that is why we will also deliver further cost of living payments worth up to £900 for claimants on means-tested benefits, £300 for pensioner households and, as I mentioned yesterday, £150 for those on disability benefits.

[Lord Watts (Lab)]

My Lords, the Minister seems to suggest that people should contact the local authority if they are in trouble. Has he contacted all local authorities to see whether they can help those people? If he has done so, can he publish the findings?

[Viscount Younger of Leckie (Con)]

I will see whether we are able to publish the findings, but perhaps I may reassure the noble Lord that there is continuous interaction between central government and local authorities in terms of the funds that we give them. As I said earlier, it is for them to prioritise the targeting of the funds but, equally, we want some feedback on how well those have been targeted. That is happening.

Disabled People: Impact from Policies and Spending Cuts

Viscount Younger of Leckie Excerpts

Tuesday 21st February 2023 Lords Chamber

[Baroness Thornton]

To ask His Majesty’s Government what steps they will take to assess the impact of their (1) policies, and (2) planned spending cuts, on people with disabilities, to ensure that they do not exacerbate existing inequalities.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, the Government recognise the barriers that disabled people face across many aspects of their lives. All government departments have rigorous processes in place, in line with the public sector equality duty to ensure that they consider proactively the impacts on disabled people when carrying out their day-to-day work in shaping policy and delivering services. This includes the Treasury, which carefully considers the equality impacts, including for disabled people, of the individual measures announced at fiscal events.

[Baroness Thornton (Lab)]

I thank the Minister for his Answer. This Question concerns the wider issue of impact assessments being used to guide government policy for disabled people, and is not just around vital income support. First, is an impact assessment being conducted, or has one been proposed, to look at the impact that Home Office immigration rules are having on the supply of personal assistants for working-age disabled people to allow them to be economically independent? Secondly, is an impact assessment being carried out, or has one been proposed, on the effects of the proposed modernisation of the railways on the mobility of wheelchair-users and people with sight impairment, many of whom are very worried about this?

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[Viscount Younger of Leckie (Con)]

The first thing to say is that there are no plans for impact assessments. What I can say to reassure the noble Baroness and the House is that much work has been done to take account of the extra costs that are required for those who are disabled. The extra-cost disability benefits have been uprated every year since their introduction, in line with inflation; these benefits were also exempt from the recent benefits freeze. Over 1.3 million more people of working age are in receipt of an extra-cost disability benefit since May 2013. On her final point about transport. we have done a lot of work on the transport issues. For example, we have enacted the Taxis and Private Hire Vehicles (Disabled Persons) Act 2022 and published guidance on inclusive mobility and tactile paving, and there is more that I could say.

[Lord Farmer (Con)]

My Lords, my understanding is that Access to Work grants for disabled people are beset with significant delays. For example, the Royal National Institute for Deaf People says that many are waiting close to four months for initial claims to be processed or renewals to be approved. This has a knock- on effect on the support workers they rely on, who understandably may refuse to take bookings from them as they will not get paid. Will my noble friend the Minister say what the Government are doing to cut delays?

[Viscount Younger of Leckie (Con)]

I agree with my noble friend that there have been delays, and perhaps I can give a little thought to this. One matter to note is that the Access to Work systems are currently receiving an increased level of applications for support—for example, there are 24,677 cases. On what we are doing about this, DWP has taken a number of actions: all applications for a job to start in the next four weeks are prioritised, renewal applications are also prioritised where possible, and support is approved using a new streamlined process. We have also increased the number of staff working on Access to Work. We are very aware of the delays and are taking some action.

[Baroness Falkner of Margravine (CB)]

My Lords, I declare an interest as chair of the Equality and Human Rights Commission. Are the Government minded to implement Section 28(8) of the Equality Act 2006, which would give the commission the powers to bring disability discrimination cases to court?

[Viscount Younger of Leckie (Con)]

Although I cannot confirm that, I know that the commission examined whether my department was making reasonable adjustments to its processes for people with mental health conditions and learning difficulties, as required under the Equality Act 2010. As the noble Baroness will know, the EHRC published a statement on 19 April about drawing up a legally binding agreement with the DWP to commit it to an action plan.

[Baroness Uddin (Non-Afl)]

My Lords, I declare my interest: a 42 year-old family member has recently become an amputee, so I have seen at first hand the desperate situation that many suffer, particularly in residential care. We are prepared to pay up to £2,000 or £3,000 a week for residential care but not for independent accommodation. Therefore, if the Minister considers an impact an assessment—I am disappointed to hear that he is not doing so—will he consider the impact on disabled people, particularly those with physical disabilities? Given local authorities’ depleted housing stock, they may need to rely on private housing. Will the Minister give some assurance that he will at least look at that?

[Viscount Younger of Leckie (Con)]

I reassure the noble Baroness that we understand that people across the UK, including those who are disabled, are worried about the cost of living—she mentioned housing and other matters. She will know that we have provided £37 billion-worth of cost of living support in this financial year, including a cost of living payment of £150 for the disabled. We have provided up to £650 for low-income households and £300 for pension households —both of these groups have large numbers of disabled people.

[Baroness Brinton (LD)]

My Lords, other noble Lords have spoken about some of the problems inside DWP. I will ask about PIP and applicants who have been disallowed it because they “didn’t return the form”. In 2017, 7,500 claimants were disallowed but, by last year, that had risen to over 42,000. The problem is that, even though many of these people were marked as vulnerable, some have died: Laura Winham starved to death, and it took three years for her body to be found—she was not the only person. What systems is DWP putting in place to ensure the protection of the most vulnerable disabled people?

[Viscount Younger of Leckie (Con)]

The noble Baroness is right to raise PIP. We are targeting support at those with the greatest needs, as she raised. PIP exempts a household from the benefits cap and is uprated by CPI, and it is payable regardless of a person’s employment status. On her particular points, I am pleased to say that we continue to see an improvement in the way that we look at and pay PIP, and particularly in the clearance times—the noble Baroness will know that there have been some delays. I will write to her on her specific question about the content. As I say, the delays are very much a priority for my department at the moment.

[Baroness Andrews (Lab)]

My Lords, I take the Minister back to his answer on personal assistants. When we were taking evidence in the Adult Social Care Committee on the provision of personal assistants, it became perfectly obvious that there is a real crisis for those people who do not want to ask their families to care for them and who would really benefit from personal assistants. One lady we spoke to had employed 27 personal assistants in the course of a year, none of whom could stay with her because they could not afford to. What is the Minister going to do, if he is not going to do an impact assessment, to find out what is actually going on in the lives of these people, particularly in an area where the data is extremely short and where we also know that people are having to take on personal assistants and then act as small businesses to try to organise their national insurance? For many, that is a huge burden.

--- Later in debate ---

[Viscount Younger of Leckie (Con)]

The noble Baroness raises an important point. I think it might be helpful to remind her that the Minister for Disabled People announced on 1 December last year that a new disability action plan will be consulted on and published in 2023. The groups the noble Baroness mentioned will be part of that. It will set out the immediate action the Government will take in 2023 and 2024 to improve disabled people’s lives, as well as laying the foundations for a longer-term change. The plan will reference the work already being taken forward by individual government departments, but I know that there is more to do in this area and she is right to raise it.

[Baroness Janke (LD)]

My Lords, a decade of tightening eligibility for out-of-work sickness benefits on top of cuts to rates means that disabled people are now far more likely to be found incorrectly fit for work than awarded benefits they do not need. When will the Government take action to do something about this injustice?

[Viscount Younger of Leckie (Con)]

We certainly keep this under review. The noble Baroness will know that SSP is administered and paid entirely by employers, at a rate of £99.35 per week. Employers are required to pay it, but as I say, this matter is kept under constant review.

[Lord Touhig (Lab)]

My Lords, we all know that the cost of living crisis and pressures on public services are affecting families across the country, but the impact on families with disabled children is particularly acute and often not well highlighted. What assessment have the Government made of the effect of their current spending plans on the level of support for disabled children and their parents?

[Viscount Younger of Leckie (Con)]

I do not have any figures on disabled children but I can say that, in the year 2022-23, we will be spending around £65.7 billion on benefits to support disabled people and people with health conditions in Great Britain, including children. This is around 2.6% of GDP. Spending on the main disability benefits—PIP, DLA and attendance allowance—will be more than £7 billion higher in real terms than it was in 2010.

Health and Safety and Nuclear (Fees) Regulations 2022

Viscount Younger of Leckie Excerpts

Tuesday 31st January 2023 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Health and Safety and Nuclear (Fees) Regulations 2022.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, the Health and Safety and Nuclear (Fees) Regulations 2022 statutory instrument was laid before Parliament on 20 December 2022 and came into force on that same day. These regulations correct an error in the powers used to make the Health and Safety and Nuclear (Fees) Regulations 2021. The error was an unfortunate oversight. Due to the volume of Covid, Brexit and trade agreement work, pressures on the Government Legal Department—GLD for short—resulted in this referencing error not being picked up in checks. HSE and GLD regret the error and are taking steps to reduce the risk of this sort of error happening again. The error was identified by GLD during a recent review.

The urgency to make these regulations arose from the need to use the powers in the European Union (Withdrawal) Act 2018 before they expired on 31 December 2022 and so avoid the requirement for primary legislation. This instrument has to be made in the affirmative and debated in both Houses because this is what the EU (Withdrawal) Act 2018 specifies.

This instrument is non-contentious, as it repeats the previous regulations with some minor technical changes. The preamble to the Health and Safety and Nuclear (Fees) Regulations 2021 did not cite one of the enabling powers and was not made with the consent of HM Treasury to certain fees for chemical regulation functions which were transferred from the EU. The correction ensures that the Health and Safety Executive can continue to recover its costs for these functions.

The preamble in the 2021 regulations refers to paragraph 7 of Schedule 4 to the European Union (Withdrawal) Act 2018. It should also have referenced paragraph 1 of Schedule 4 to give the powers for the provisions which allow charging for certain regulatory activity around biocides and classification labelling and packaging—so-called CLP. In addition, this same error was repeated in later regulations, which contained a series of amendments to, and mirrored powers in, the 2021 regulations. This instrument also corrects that error.

Biocides and CLP provisions in the fees regulations 2022 rely on paragraph 1 of Schedule 4 to the European Union (Withdrawal) Act 2018, and so consent from HM Treasury is required, as referenced in paragraph 3 of that schedule. I can assure your Lordships that consent has been given. I can also assure your Lordships that we have a rigorous checking process in place which will normally ensure that errors are identified before instruments are made.

In conclusion, I take this opportunity to emphasise that this instrument is a restatement of the fees regulations 2021, with the correct powers cited in the preamble and for which HM Treasury consent has been obtained. These changes put beyond doubt the ability of HSE to charge fees for certain biocides and CLP regulatory activity. The instrument makes no changes to policy or duties, although, as explained in the Explanatory Memorandum, it corrects some minor technical errors as well.

I hope that colleagues of all parties will join me in supporting the new regulations, which I commend to the Committee. I beg to move.

[Baroness Sherlock (Lab)]

My Lords, I thank the Minister for that introduction, and I can only take it that the remarks he addressed to “colleagues of all parties” means me, so I am delighted to be here. I also love it when a Minister announces, as was done in the Commons as well, that an instrument is non-contentious. From the Opposition Benches, our mind goes, “Well, we’ll see about that; that’s our call.” It is not the kind of thing one can do unilaterally.

However, as we have heard, this instrument revokes and replaces the Health and Safety and Nuclear (Fees) Regulations 2021, as amended by the amending regulations, and consequentially revokes Regulation 14 of those. We have heard that the purpose is to correct a number of errors. I accept that some of them are clearly technical. There is the incorrect cross-reference in Regulation 12, the error in the definition of “nuclear provisions” in Regulation 16 and the omission from Regulation 22 of the process clarifying how to interpret terms on classification, labelling and packaging, and so on.

However, there is a more serious error. The fees regulations 2021, as amended, were meant to enable the Health and Safety Executive and the Office for Nuclear Regulation to charge fees for a range of specified activities, but, as we hear, it has become apparent that an error in the preamble to the regulations and to the amending regulations has caused a problem. Neither cites paragraph 1 of Schedule 4 to the EUWA 2018, but both should have done so. The problem is that that would have allowed provision for the charging of fees in connection with functions following Brexit, particularly those performed by the HSE in relation to biocides and chemicals—I still think fondly of our long debate on biocides and chemicals not very long ago.

I have some questions. The effect of the error was that the required Treasury consent was not sought prior to the making of regulations under paragraph 1 of Schedule 4 to the EU withdrawal Act. I accept that the Treasury has indicated that it would have given consent had it been asked. However, it was not asked, which is of course the problem. The EM says that the error

“may raise doubt as to HSE's ability to continue to recover the affected fees.”

Can the Minister unpack that a little more for us? First, we need to be clear what fees have already been charged using the flawed powers in the 2021 regulations. When these regulations were debated yesterday in the Delegated Legislation Committee in another place, the Minister, Mims Davies, said:

“About £25,000 was charged across the industry under the powers related to the error. However, HSE judged that there is a low chance of any case being brought, due to the amount of money involved. That is why we are rectifying it extremely quickly. HSE will continue to manage any legal implications on a case-by-case basis.”—[Official Report, First Delegated Legislation Committee, Commons, 30/1/23, col. 8].


Can the Minister tell the Committee: was there a legal basis for charging those £25,000-worth of fees? If not, will the money be refunded to the firms which paid them, or do I take it from that last sentence of the Minister that the Government are simply waiting to see whether anyone who paid them under deficient rules will sue to get their money back? Were any fees not charged as a result of this error that would otherwise have been charged? If so, has any revenue been lost?

There are two other questions. We need to know more about how we got here and, more importantly, how the Committee can be assured it will not happen again. I accept that drafting errors happen, of course, but there are quite a lot of errors in one set of regulations here. Yesterday, the Minister gave the explanation that the noble Lord has repeated today, which dumps the blame pretty much lock, stock and barrel on the Government Legal Service, saying that it was under pressure as a result of Covid, Brexit and trade agreement work, it had too much pressure and that is why it happened. The only problem with that is that two of those three were completely foreseeable. I realise that post Brexit there will have to be redrafting of regulations and other legislation, but the volume and speed is a direct consequence of decisions the Government made about the nature of Brexit and about the way to handle retained EU law.

So, knowing all this, why did the Government not plan and resource the GLD accordingly so that it could deal with the volume of work and the pressure that it would be facing? We cannot simply accept that our statute book should be in a mess as a result of Brexit. There were various points at which these errors could have been picked up. Why were they not? Is there a quality assurance process in place? Does the HSE or the DWP do any checking of their own legislation? Do they literally just give it to the GLD, say, “Do it!” and then take whatever is given back and put it out? Is there a quality assurance process and, if so, why was none of the errors picked up? I spent some years as a non-executive director on a board. If the executive reports a significant error, the question that one asks is: is it systemic? If the answer comes back, “No, it is not”, then one wants evidence of that; if the answer is: “Yes, it is”, one wants to know how one can be assured that it will not happen again?

The Minister yesterday in the Commons said that,

“the HSE and the GLD have completed a full review of the lessons learned,”

and,

“identified some practical actions”.—[Official Report, Commons, First Delegated Legislation Committee, 30/1/23; col. 7.]

to improve ways of working between their officials. That is nice but—this is an important question—if those practical actions had been in place, would they have avoided these errors? So, one has done lessons learnt. If one had done those things then, could this error have happened? If it could still have happened, then we have not solved the problem. Did the review look at other errors, other than the one that it turned out had created this problem?Crucially, how confident is the Minister in assuring the Committee that something this serious will not happen again?

Finally, we are told that

“the Department is adopting the free issue procedure in relation to this instrument.”

Do I take it that that means that there will be free issues of this instrument and the amendment regulations? What will be the cost of that?

Given that I have fired a number of questions, I really want to get answers today—I do not want any more letters because they never arrive, or they may arrive eventually but it takes a long time and these regulations have already been made. To clarify, I am interested in finding out: what happened; why the mistakes were not picked up; whether fees were charged without any legal cover and, if so, whether fees are going to be refunded and whether there were fees that could have been charged that have not been; whether there is quality assurance in place; and whether the DWP and the HSE do any checking of their own legislation and how they can assure us that this will not happen again. I look forward to the Minister’s reply.

[Viscount Younger of Leckie (Con)]

My Lords, I thank the noble Baroness, Lady Sherlock, for her response. I totally understand the tone and nature of the questions that she has asked. I hope that I can respond. It may be that the detail in the responses is not quite what she is looking for and, of course, I will say that I will write to her if the answers are deemed to be not satisfactory. But I will certainly do my best.

I should like to say first that these errors are unfortunate. As I said, the error was an unfortunate oversight caused by pressures on the GLD—the legal side—due to the volume of Covid, Brexit and trade agreement work. Despite checks in place, the omission of one of the powers from the preamble was not noticed. I shall go into a little more detail in terms of how the error was noticed. The preamble to the fees regulations 2021 referred to Paragraph 7 of Schedule 4 to the EUWA 2018 but should have also referenced Paragraph 1 of that schedule. The error was repeated in the amendment regulations, being a set of regulations that amended the fees regulations 2021. Due to that unfortunate oversight, the correct power was not cited in the preamble, which meant that certain regulations were made without the consent of HM Treasury, as they should have been. The error was spotted during a recent review of the fees regulations 2021, as I mentioned.

On the noble Baroness’s question what has been done to prevent such errors happening again, I believe that the review has been rigorous, and we do not believe that it will happen again. However, I shall give a bit more detail. HSE and GLD have completed their review of lessons learnt. This has identified some practical actions that can be taken including better ways of working between GLD crucially and HSE policy officials.

The question of HM Treasury and its role came up, and perhaps I can be helpful in answering some questions. HM Treasury has approved the 2022 fees regulations and has confirmed that consent would have been provided at the time of the 2021 regulations, if sought. HM Treasury consent was given when the fees were first introduced into UK law in 2019 by way of amendments to the fees regulations 2016. HSE is informing HM Treasury of the proposed treatment of the approximately £25,000 of fees received between 1 April 2021 and 21 December 2022. Some 14 companies have been charged between £500 and £5,000, so I hope that is helpful.

--- Later in debate ---

[Baroness Sherlock (Lab)]

On the £25,000, I asked a specific question: was there legal cover for charging that money? I would like an answer to that. I think the Minister said that the HSE is informing the Treasury as to what it will do about the money. Can he inform us what it is going to do about it rather than just the Treasury?

[Viscount Younger of Leckie (Con)]

Those are two fair questions. I will have to write to the noble Baroness to follow through on the specific details that she has asked for. I will certainly write a letter and make sure that she is fully informed. With that, I commend these regulations to the Committee.

Motion agreed.

Universal Credit: Benefit Cap and Two Child Limit

Viscount Younger of Leckie Excerpts

Tuesday 24th January 2023 Lords Chamber

[Baroness Lister of Burtersett]

To ask His Majesty’s Government how many families in receipt of Universal Credit are subject simultaneously to the benefit cap and the two child limit.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, both policies aim to introduce fairness between households claiming benefits and taxpayers who support themselves solely through work. We estimate from published statistics that fewer than 30,000 households were impacted by both policies in April 2022, which is under 1% of households on universal credit. These families may benefit from additional financial help, such as the cost of living payment and discretionary housing payment, if they need additional support to meet rental costs.

[Baroness Lister of Burtersett (Lab)]

My Lords, in the absence of official data hitherto, the Benefit Changes and Larger Families Project estimates that at least 110,000 children are being pushed deeper into poverty because their parents are caught by both the cap and the two-child limit. Evidence of the damaging effects strengthens the case for scrapping both policies, which are far from fair. At the very least, will the Government now undertake to publish regular data on the numbers affected and monitor the impact on children and their parents?

[Viscount Younger of Leckie (Con)]

I am certainly aware of the larger families project. The latest published statistics on households on universal credit show that the majority of families—79%—on universal credit had fewer than three children, with 21% of universal credit households with children having three or more children. Having said that, it is important to note that there are a number of other initiatives where we can help families with more than two children if they get into difficulty.

[Baroness Meacher (CB)]

My Lords, one of the major contributors to poverty is the absence of affordable housing. Shelter produced a really alarming report this week which showed a year-by-year reduction in the building of affordable housing over the past 12 years. Do the Government have a commitment to reverse that policy and to increase the number of affordable homes built every year so that people living in abject poverty—particularly those depending on universal credit—will at least be able to find an affordable home?

[Viscount Younger of Leckie (Con)]

Absolutely. There are a number of initiatives on housing, which I am sure the noble Baroness will be aware of. One example is the discretionary housing payment, which can be paid to those entitled to housing benefit or the housing element of universal credit, particularly those who face a shortfall in meeting their housing costs. It is certainly a matter that I am aware of, and I know that my noble friend Lady Scott will be very much on top of that. We are working across government on this issue.

[Lord Farmer (Con)]

My Lords, can my noble friend reassure me that universal credit still makes work pay despite childcare costs when there is more than one child? Of course, an at-home parent conscientiously doing their own childcare in the early years is, in fact, working. What expectation is placed on claimants to work when parental care is their strong preference?

[Viscount Younger of Leckie (Con)]

Yes, my noble friend makes an important point. I should say at the outset that the Government firmly believe that, where possible, it is in the best interests of children to be in working households. That is why the department has continually provided support to help move people into work. To further that, this sort of support in making people financially resilient by moving them into work and also ensuring that they are progressing in work is important; up to 85% of the registered childcare costs each month is paid regardless of the number of hours that they work, compared with 70% for tax credits.

[The Archbishop of York]

My Lords, it is encouraging to see that the Government are keeping a check on the numbers of people being affected by these policies, but I was not quite sure whether I heard that work is being done to measure the impact of the policies on families. I can say, and it gives me no joy to say it, that from where I serve in the north of England—I am thinking particularly of Middlesbrough and Hull—I see the disturbing impact of an increase in poverty, child poverty and families in very difficult situations, not least with the cost of living crisis on top of all this. My simple, genuine and heartfelt question is: how would you explain this to a mum expecting her third child, or a family with three or four children who have been pushed into benefits over the past couple of years? They do not understand why this is happening but they are suffering as a consequence of it. How do we explain to them the rightness of this policy?

[Viscount Younger of Leckie (Con)]

My Lords, first, we are very aware of the fact that some people are finding it particularly difficult at the moment—some very good points have been made about that. One of the issues to focus on, which we are doing, is childcare, which is a key enabler of employment for parents and has clear developmental benefits for children. Of course, the onus falls on the caseworkers in the jobcentres. Often they are very well trained, and they have to deal directly with these people who come with some heartfelt stories.

[Baroness Sherlock (Lab)]

My Lords, can I give a specific example? The most reverend Primate has talked about the impact on individuals. The larger families study that the Minister mentioned interviewed parents who have been affected by this. It gives the example of a single mother who had experienced domestic abuse. She was given an exemption from the two-child limit under the rape clause because the child was conceived by rape, so she was then awarded an extra £237 a month. But then the benefit cap kicked in and she got only £30 a month of it. Because she struggled to provide for her children, she ended up returning to a violent relationship. I ask the Minister again: what does he think about the impact of these policies, not just their number?

[Viscount Younger of Leckie (Con)]

The noble Baroness makes a good point because we should be aware of the impact, which is why we are working hard on a number of initiatives. As she will know, there are a number of fallbacks on top of this, particularly the provision of cost of living support worth over £37 billion for 2022-23, including £400 for the non-repayable discount to eligible households. However, it is more than this. I am in awe of people on the front, including those who work in the front line of the jobcentres, who work with the social workers, and indeed with the Church, to see through these very challenging issues for some families.

[Lord Goddard of Stockport (LD)]

My Lords, does the Minister agree that larger families on benefits are doubly penalised by the Government’s policy, not only by losing support for third or subsequent children but also due to the lack of affordable childcare to enable them to work? Those families are, in effect, losing £2,935 a year.

[Viscount Younger of Leckie (Con)]

I mentioned childcare costs before and it is important to support parents who have childcare needs. Of course, we have the child benefit but on top of that there are other support mechanisms to ensure that those who have children—particularly more than two, which is the subject of this Question—can survive and, in many cases, find the next meal.

[Baroness Deech (CB)]

My Lords, research has shown that the majority of children of single parents would be lifted above the poverty line if the absent fathers paid what they owe. For decades, the child maintenance system has let single mothers down, condemned children to poverty and let men get away with it. What is the Minister’s advice?

[Viscount Younger of Leckie (Con)]

This is another important subject. The child maintenance system supports separated parents to agree their own family-based arrangements where it is possible. Where it is not possible, the child maintenance system steps in. It is incredibly important that the paying parent pays, and this is where the system is dealing with some extremely challenging issues in order that the receiving parent receives what they are due.

[Baroness Berridge (Con)]

My Lords, all noble Lords will be pleased that it is a small number of families that are affected. Can the Minister inform us whether any of those families are also being affected by having to pay back money, such as aged debts, when they are on such limited income? It has always struck me as rather odd since when you get fined in a court, very careful consideration is given to your means to pay, and if you borrow money from the Government for your education, you are not asked to repay it until you are earning a fair sum of money. The poorest in our society are being asked to pay money back to the Government, so can the Minister provide us with information on that?

[Viscount Younger of Leckie (Con)]

I will need to write to my noble friend about that issue. I am certain that this system allows for payback whenever possible, but I will certainly look into that.

[Baroness Finlay of Llandaff (CB)]

Can the Minister tell us when the special rules, which have passed through Parliament, will come into force for people caring for a terminally ill person at home, given that the cost of care has gone up quite significantly and that if it is a young parent, some people can find themselves in such poverty that they have to go bankrupt?

[Viscount Younger of Leckie (Con)]

I do not have any information to hand on the future of any legislation, but I will certainly follow up with the noble Baroness and let her know whatever I have.

Bereavement Benefits (Remedial) Order 2022

Viscount Younger of Leckie Excerpts

Tuesday 24th January 2023 Lords Chamber

Moved by

[Viscount Younger of Leckie]

That the draft Order laid before the House on 13 October 2022 be approved. Considered in Grand Committee on 17 January.

Motion agreed.

Bereavement Benefits (Remedial) Order 2022

Viscount Younger of Leckie Excerpts

Tuesday 17th January 2023 Grand Committee

Moved by

[Viscount Younger of Leckie]

That the Grand Committee do consider the Bereavement Benefits (Remedial) Order 2022.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, I am pleased to introduce this remedial order, which was laid before the House on 13 October. It will extend the higher rate of bereavement support payment and its predecessor, widowed parent’s allowance, to bereaved cohabitees with dependent children. These benefits can currently be paid only to survivors who were in a legal union—that is, married or in a civil partnership—with the deceased on the day they died.

In the McLaughlin judgment in the Supreme Court, handed down on 30 August 2018, and the Jackson case in the High Court, handed down on 7 February 2020, the legislation on WPA and the higher rate of BSP respectively was declared incompatible with Article 14 of the European Convention on Human Rights. This article requires all rights and freedoms set out in the Act to be protected and applied without discrimination. In both cases, the courts found that, by restricting eligibility to those in a legal union, current legislation discriminates between children on the grounds of the legal status of their parents’ relationship.

This order provides a remedy for both Great Britain and Northern Ireland. It does so by amending the Social Security Contributions and Benefits Act 1992, the Social Security Contributions and Benefits (Northern Ireland) Act 1992, and the Pensions Act 2014. I am satisfied that the provisions of the order are compatible with the European Convention on Human Rights. The Joint Committee on Human Rights has reported on this draft order and recommended its approval.

I will put this draft remedial order into some context. It was in 1925 that financial assistance following a bereavement, in the form of national insurance pensions for widows, was first introduced. This was open to all widows whose husbands fulfilled the contribution conditions, paid at a flat rate with additional allowances for children. This reflected the widely held expectation at that time that a woman would not return to work after marriage.

Further reforms culminated in the introduction of three new bereavement benefits: widowed parent’s allowance, bereavement allowance and the bereavement payment, all in 2001. WPA replaced widowed mother’s allowance, and extended support to both widows and widowers with dependent children. Like its predecessor, it was intended to provide ongoing financial support following the death of a spouse or, from 2005, a civil partner.

The bereavement payment was a one-off payment for surviving spouses, both with and without dependent children. Bereavement allowance was a short-term payment for widows and widowers aged 45 or over with no dependent children. It was not possible to get both widowed parent’s allowance and bereavement allowance.

It became evident that this system of bereavement benefits, based on outdated assumptions, was complex to understand and administer, and could be unfair to claimants. With universal credit’s introduction—a benefit designed to help with ongoing living costs—there was a need to look again at the whole package of bereavement benefits, but especially widowed parent’s allowance, which could be paid for the same purpose. So we modernised bereavement support by introducing a new benefit, the bereavement support payment, from 6 April 2017, to help with the more immediate costs of bereavement and to allow for a period of adjustment.

Although we do not specify what these costs are, it is our intention that they should be those associated with the bereavement. Each family will have different priorities. For some, it could be funeral costs or dealing with debts left by the deceased. For others, it may include budgeting adjustments following a loss of income or additional travel simply to meet family members.

BSP consists of an initial lump sum followed by 18 monthly instalments, and a higher rate is paid for those with dependent children to recognise that families with children may need extra help. Unlike its predecessors, it is tax-free and disregarded for the purpose of income-related benefits, thereby helping those on the lowest incomes most.

Bereavement benefits have only ever been payable to those who were in a legal union with their deceased partner. They are contributory benefits, with eligibility linked to the national insurance contributions of the deceased partner. Such inheritable benefits, derived from another person’s national insurance contributions, have historically been based on the concept of a legal union.

I will now move forward and outline what this draft order covers. Eligibility for WPA and the higher rate of BSP will be extended to surviving partners with dependent children who were living with their deceased partner as if they were married or in a civil partnership on the date of death. This includes partners who are or were pregnant on the date of their partner’s death, and there will be no qualifying period of cohabitation. This change will benefit thousands of families with dependent children.

This draft order applies to those who would have been entitled to either of these benefits on, or from, 30 August 2018. This was the date on which the Supreme Court, in the McLaughlin case, ruled existing WPA legislation incompatible with the European Convention on Human Rights and, effectively, the date on which the incompatibility was accepted as final. The Committee will know that it is exceptional to make social security change retrospectively; we consider this a logical and fair start date.

For BSP, where the death occurred before this order becomes law and the claim is received within 12 months of that date, claimants will get the full amount due to them. If the claim is received later, the claimant will get up to three backdated monthly payments, plus any remaining monthly payments due. The claim must be made within 21 months of the order coming into force for any BSP to be payable.

Where a claimant’s partner died before 30 August 2018, we will make a part payment and no initial lump sum will be payable. Where the death occurred after this order comes into force, BSP will be paid subject to the usual claim time limits: 12 months for the initial lump sum and three months for each instalment.

Claimants will be eligible for WPA where their partner died before 6 April 2017 and they continued to meet the entitlement conditions on 30 August 2018. They too must claim within 12 months of the date the order comes into force. They may also be entitled to ongoing payments if they continue to meet the WPA eligibility criteria at the point of claim.

Extending these benefits to cohabiting partners means that there may be cases where more than one person claims for the same death. This could apply in cases of polyamory or people dividing their time between two households, or where there is a separated spouse who no longer lived with the deceased. As noble Lords can appreciate, this is a complex area and my officials have been working hard to develop an approach that balances protecting taxpayers’ money and the contributory principle, while ensuring that any approach reflects people’s real-life circumstances.

In these cases, this order proposes that we pay just once per death, prioritising who was living with the claimant on the date of death. Where there are claims from different addresses, entitlement would be established as part of the normal decision-making and appeals processes.

In very rare cases, more than one potential claimant may have been living with the deceased on the date of death. Here, entitlement will be decided according to a hierarchy, intended to reflect the most established relationship as this person would usually bear the majority of the bereavement costs. Should this leave more than one potential claimant and become more complex, the Secretary of State would determine who is entitled.

Transitional protection will ensure that those already in receipt of WPA or BSP before the date this order comes into force do not lose their entitlement for the duration of their award. WPA is treated as income for the purpose of income-related benefits, such as universal credit, and is assessed at the point of award.

This order provides for all retrospective WPA payments up to the date of claim to be treated as capital and disregarded for 12 months, or 52 weeks for the purposes of income-related benefits. This ensures that claimants will not lose any existing entitlement to income-related or passported benefits, such as free school meals, as a result of receiving a retrospective award. This order also ensures there is a disregard for the same period for retrospective BSP awards. The usual rules will apply to future BSP and WPA entitlements.

We do not propose any changes for the treatment of income tax; BSP is already tax-free and WPA will be taxed according to the period of entitlement, as per the existing rules. We will communicate to make WPA claimants aware that any payment under this order may incur an income tax liability. The payment of BSP does not affect a person’s tax credit entitlement. WPA will be treated as income for tax credit purposes, as is common practice for social security benefits. It will be assessed in the year of payment rather than entitlement, so no adjustments to past years will be needed.

In accordance with paragraph 3(1) of Schedule 2 to the Human Rights Act 1998, a proposed draft of this order was laid for a 60 sitting-day period on 15 July 2021 to allow for Members of both Houses and other stake- holders, including the JCHR, to make representations. I fully considered all the representations made on the draft proposed order before preparing this draft for affirmative resolution. In doing so, I agreed with the recommendation of the JCHR to amend the order to ensure that pregnant WPA claimants were covered in the same way as those in a legal union. I also agreed with its recommendation to ensure that the implications of the retrospective effect of the order on entitlement to income-related benefits be taken into account. I have also included a number of technical amendments in response to comments made by the JCHR.

Finally, I emphasise how straightforward it will be, as we see it, for people to claim. We already know from our evaluation that claimants have a very positive experience of claiming bereavement support payment, with 97% reporting satisfaction with the process. We have also provided a paper claim form especially for cohabitees, accessible online at GOV.UK or by calling DWP’s bereavement service. For BSP, there will also be the option to claim online.

With that detail behind me, I have pleasure in commending this order to the Committee. I beg to move.

[Baroness Hayman (CB)]

My Lords, I am grateful for the opportunity to speak today and to the noble Viscount for the clarity with which he introduced this order. As he made clear, there are many complexities around the subject but the reason that I am here today is very simple.

In October 2020, I received an email and I shall read some of it: “Dear Madam, I am writing to you to raise an issue with the Department of Work and Pensions. On 12 September 2020, my partner of 12 years sadly passed away after losing his five-year battle with kidney cancer. He leaves behind me and our six year-old son. When going to apply for a bereavement support payment, I learned I was not entitled to claim this support as my partner and I were not married or in a civil partnership. I am writing to you because I feel this is a very unfair law and needs to be reviewed straight away, especially when we are going through a national pandemic and I find that I am not the partner of a very strong and resilient man any more, and I have been left these difficulties and increased anxiety as I face bringing up a child alone. I am by no means begging but I do think that this is discrimination to couples who love each other and live with each other as man and common-law wife with children, because they haven’t got a piece of paper to say they are together. I hope you can raise this issue.”

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I look forward to the Minister’s reply.

[Viscount Younger of Leckie (Con)]

My Lords, I start by thanking the Committee for its overall support for and approval of this order. I wholly appreciate that I am very much the messenger here as I am new to the role. For once, having spent 12 years in the Lords, having dealt with some challenging legislation and issues and having said myself that something will be brought forward “in due course” or shortly, I am the messenger for the great work that my predecessor, my noble friend Lady Stedman-Scott, has done and brought to fruition. I am delighted that we have come to this point, with this order bringing cohabitees into this area; as I say, I pay tribute to my predecessor for that.

A vast number of questions were asked. Many of them were very technical so, again, I feel that I have been thrown in the deep end. All the questions were fair; I will do my best to answer them. I know that I will not be able to answer all of them; certainly, I can already feel quite a detailed letter coming the way of noble Lords to be sure that I answer all their questions. When bringing in a new order of this nature, such questions are obviously natural. I am particularly aware of the question asked by the noble Baroness, Lady Brinton; I will come to it towards the end of my speech. I am not sure how much I can help her, but she referred to an interesting case.

Let me start with the noble Baroness, Lady Hayman. First, I thank her for her points. Secondly, I thank her for the letter she mentioned; as I moved into this role and took over from my predecessor, I picked up a letter, and there is a letter answering some of the noble Baroness’s question on its way to her. Her first point was very fair. She asked why this order has taken so long. My answer is that remedial orders can take longer than many other orders because they involve extensive consultation and, of course, parliamentary scrutiny. Also, in the introduction of the pandemic, we needed to divert departmental resources.

That said, the main reason was the delay resulting from the McLaughlin judgment in 2018; it made sense to wait for the conclusion of the Jackson case in 2020 before deciding how to proceed. Let me be the first to say that I appreciate that there was a pretty long gap between laying periods, but it is by no means unusual. I would also say that it was too long; I know that from the different cases that have been raised.

Additionally, officials have had to work through a number of complex policy, drafting and implementation issues, including those raised by the Joint Committee on Human Rights, which have required careful consideration. It is also vital that we get this right—I would say that, wouldn’t I, but I mean it. Throughout the process, the remedial order has remained a priority for this department and will continue to do so. Bearing in mind the number of questions that have been raised, I know there is quite a bit of work to do to see this through. I hope that provides some reassurance.

The question of raising awareness was raised by a number of noble Lords, starting notably with the noble Baroness, Lady Hayman, and continuing with the noble Baroness, Lady Sherlock. We are taking a range of steps to raise awareness of the remedial order, including updating GOV.UK and using existing DWP channels to communicate about this change. We are also working closely with external organisations to ensure that people have what they need to make an informed decision about making a claim.

To go a little further on this and answer a question raised by the noble Baronesses, Lady Hayman and Lady Sherlock, we want to ensure that people have what they need to make an informed decision about making a claim, but we will not be contacting previous claimants directly. We do not routinely keep details of people who had originally claimed and been refused benefit on the basis of being in a cohabiting relationship. However, my officials will develop an effective communication strategy that reaches out to as wide an audience as possible. That may not entirely satisfy the noble Baronesses who raised this question, but we were prepared for it and this is where we stand on that issue.

There is more, because how DWP staff reach out is also important. These changes will be delivered by the DWP’s existing bereavement services team, and officials have already been developing guidance, training and other products to ensure operational readiness on the go-live date. I am sure that there is more that can be done, but I hope that helps to begin with.

My noble friend Lady Altmann and the noble Lord, Lord Davies of Brixton, asked how payments of WPA are usually treated for tax and benefit purposes. As I think I said in my opening remarks, but to clarify, WPA is taken into account as income when assessing entitlement to other means-tested benefits, so is also taxable. I can and will write, because there is further detail that I can give the noble Baronesses on the lump sums, which they raised specifically.

The question of tax credits and how they will be treated was raised, again, by my noble friend Lady Altmann and by the noble Baroness, Lady Sherlock. Payment of BSP does not affect a person’s tax credit entitlement. To be clear, WPA will be treated as income for tax credit purposes, as is common practice for social security benefits. It will be assessed in the year of payment rather than in the year of entitlement, so no adjustments to past years will be needed.

However, I know that the noble Baroness, Lady Sherlock, raised a point about back payments. I do not have an answer to that, so I will write to her and copy in all Members of this Committee to answer that question.

My noble friend Lady Altmann asked about claimants’ use of their retrospective payments and whether, as I mentioned in my opening speech, it is viewed as deprivation of capital. We have a duty to ensure that means-tested benefits are paid to those who most need them, while also ensuring fairness to the taxpayer. The deprivation of capital rules are intended to apply to those who act with the intention to access or get more benefit. Therefore, provided any capital is spent reasonably, and not with the purpose of accessing or getting more benefit, claimants should not be treated as having notional capital. To define that, notional capital is taken into account in the same way as normal capital, where claimants get a retrospective lump sum. That was a bit of a convoluted response, but I hope that the department’s consideration of this was helpful.

A broader question from my noble friend Lady Altmann was on how payments of BSP are usually treated for tax and benefit purposes. She may know this, but the lump-sum element of BSP has a grace period, as it is intended to meet immediate needs—I think I alluded to this in my opening remarks—and is disregarded as capital for a full 12 months of universal credit. Additionally, the smaller monthly instalments of BSP are not taken into account as income for the full duration of the benefit award. This is more generous than the previous bereavement benefits, which were taken into account for income-related benefits. Unlike the previous benefits, BSP is not taxed.

The noble Lord, Lord Davies of Brixton, raised some further points about tax. Perhaps I might give an overarching response. BSP is tax free, as mentioned, while only WPA is taxed and is a legacy benefit; it can be paid only for deaths before April 2017. BSP and WPA are available only to working-age people, which I think the noble Lord will probably know.

Questions were raised about the ease of navigation. I hope that I can be helpful on that to the noble Baroness, Lady Sherlock, and the noble Lord, Lord Davies. This is an important point, as the operation of it is essential. I am happy to say that we already know that the process for claiming BSP is quick and clearly explained. I mentioned that the satisfaction level is very high at 97%. I am sure there is more that we can do but I am aware of some of the concerns raised about this. We are alive to this, as it is very important that people are not put off by not being able to operate the system properly.

My noble friend Lady Altmann and the noble Lord, Lord Davies, also asked about awareness of the changes. This perhaps goes a bit further than I went earlier. I already mentioned updating GOV.UK; I may also have mentioned that we are working closely with external organisations to ensure that people have what they need to make an informed decision about making a claim. I am pleased to say that for those previously refused entitlement, either by the Secretary of State or the tribunal, it will be open to them to make a new claim for benefit. The remedial order deliberately extends the time period for making such claims; this should ensure that all who qualify can access support, irrespective of whether they have claimed before. I think I pointed out, as far as I could, what we are doing to make people who had claimed unsuccessfully before aware that they could claim again.

The noble Lord, Lord Davies, and the noble Baroness, Lady Sherlock, raised a very important point on the evidence of cohabitation. They asked what evidence people will need to provide. The Committee will know that the onus will be on the claimant to prove cohabitation. We intend to use existing DWP IT systems to verify information provided by the claimant as part of their claim. If the information provided cannot be confirmed, the claimant will be required to provide two forms of documentary evidence. We will accept evidence in line with that currently accepted by DWP as proof of address. Where claimants are unable to provide documents, we will take a customer declaration over the phone. This approach follows the existing evidencing strategy for married couples and those in a civil partnership. We believe that this is a pragmatic and compassionate approach which minimises the impact on the claimant, is deliverable and protects against the risk of fraud. I would say also that, as this is new and coming in, we will obviously monitor it carefully, but that is where we stand at present.

The noble Lord, Lord Jones, asked an interesting question about the statistics on future retrospective payments and the average amounts. Unfortunately, as he might probably guess, I am unable to give the figures to him. They are not yet in the public domain but, of course, I am happy to write—but not quite sure when I can write—to him with the figures. It may be that somebody behind me can say it might be soon. The point is that his question is very much noted; I think it was echoed by the noble Baroness, Lady Sherlock.

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[Baroness Sherlock (Lab)]

I am grateful to the Minister and thank him for the answers he has been able to give. He was unable to answer questions from my noble friend and me about the treatment of the lump sums, which are extremely important. They are at the heart of the way this order will be operationalised. Given that, according to the order, it takes affect the day after it is made, can the Minister undertake to write as quickly as possible?

[Viscount Younger of Leckie (Con)]

The noble Baroness raises a very fair point. I will speak to the team and see what we can do to write a letter quickly covering all the points, not just that particular point.

Motion agreed.

Enterprise and Regulatory Reform Bill

Viscount Younger of Leckie Excerpts

Wednesday 24th April 2013 Lords Chamber

Moved by

[Baroness Stowell of Beeston]

That this House do not insist on its insistence on Lords Amendment 36 and do agree with the Commons in their Amendments 36C to 36E.

[Baroness Stowell of Beeston]

My Lords, I will also speak to Motion B. We return to discussion of the equality provisions of the Enterprise and Regulatory Reform Bill. The House debated these issues on Monday and strong views were expressed, on which the Government have reflected very carefully. On Monday, as on other occasions, the noble Baroness, Lady Campbell, spoke eloquently and with passion about the importance of the commission’s general duty. I very much respect the knowledge that she and others contributed during the passage of the Bill.

The Government want the commission to be a strong equality and human rights body: our national expert whose opinion is respected and valued. This is what our legislative proposals, alongside our non-legislative work, are intended to achieve. We recognise that the general duty is important to many people as a symbolic statement of the Equality and Human Rights Commission’s overarching purpose. After the debate and Division in the House on Monday, the Government reflected further and decided to no longer press for its removal from the Equality Act 2006. However, as I argued on Monday, the general duty has a practical effect, as Section 12 of the Equality Act 2006 requires the commission to monitor and report on society’s progress against the aims set out in the general duty. We continue to believe that the commission will be more effective if the monitoring and reporting that it is required to do focuses clearly on its core equality, diversity and human rights duties.

The Motion we are considering today enables the commission’s general duty at Section 3 to remain in the Equality Act 2006. It also proposes that the commission should monitor progress against the duties specified in Sections 8 and 9 of the Equality Act 2006 —equality, diversity and human rights—the very areas where the commission can make a difference in society as our national equality body and national human rights institution. I should make clear that the commission will continue to be required to monitor and report every five years on changes in society in areas that it is uniquely placed to influence and change: in other words, those specified in Sections 8 and 9.

I come now to some technical amendments and beg the patience of noble Lords. Retaining the general duty at Section 3 also requires a consequential amendment to ensure that the word “groups” in the general duty is defined effectively. Amendment 36C, agreed by the other place, reinserts the parts of Section 10 that define “groups” for the purposes of the Act. Amendments 36D and 36E are technical and consequential amendments.

These proposals, which were fully supported yesterday in the other place, address the concerns raised during debates in this House. They build on the good progress already made. The Equality and Human Rights Commission is now well placed to go from strength to strength. I beg to move.

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Moved by

[Baroness Stowell of Beeston]

That this House do not insist on its insistence on Lords Amendment 37 and do agree with the Commons in their Amendments 37C to 37F in lieu.

[Baroness Stowell of Beeston]

My Lords, this House has debated caste and caste discrimination at each stage of this Bill since Grand Committee. I pay particular tribute to the noble and right reverend Lord, Lord Harries, and my noble friends Lord Avebury and Lord Deben, for their important, impassioned and at times moving contributions to these debates. I also acknowledge many other noble Lords who spoke in heartfelt and well informed ways, many for but some against the different amendments relating to caste discrimination being incorporated into the Equality Act 2010.

Earlier this week we considered this issue again in some detail, and this House repeated its view that caste should be directly included in the Equality Act 2010 as an aspect of race. The Government have always said that we are against any form of caste prejudice or discrimination. What has been at issue is how best to tackle any such prejudice and discrimination that may occur.

We have listened carefully to what this House has said, and we acknowledge the strength of opinion that has been expressed. While I need to record that we remain unconvinced that the evidence shows that legislation is the right way to resolve problems associated with caste prejudice or discrimination, we none the less accept the need to resolve this matter. We have therefore made the commitment, after full and extensive consultation, to legislate. Noble Lords will recognise that this is the essential difference compared with our earlier proposals.

The amendment that was last debated in this House would have seen caste directly become an aspect of race for the purposes of the Equality Act 2010. Instead, we propose an alternative form, which was originally proposed as an amendment in this House in Grand Committee. Under this amendment in lieu, what is currently a discretionary power in the Equality Act to add caste to the list of race characteristics will become a duty on the Secretary of State. This amendment still gives effect to the need to legislate, while giving us greater flexibility to pick up the key issue of public consultation, which I believe the House recognises to be necessary and useful.

There are important issues on which we need to consult widely. The first concerns the definition of caste in the Act and any associated exceptions. Second is the issue of non-legislative concerns, some of which were highlighted by the Opposition in the other place and raised in this House, for example the guidance needed by business or by courts and tribunals, or the vexed question of caste identification and monitoring. Finally, there are wider issues to do with caste, such as gathering the right evidence that may be needed for the eventual statutory reviews, to which I shall come in more detail in a moment.

The secondary legislative approach, which the Government are proposing today and which I think was supported by a number of speakers, gives us better assurance that we get the legislation right, as well as greater flexibility on its timing. I should add that we intend to continue with our Talk for a Change education programme in relevant communities, which we continue to see as having an important role in effecting cultural change over time. We also wish to involve and work closely with the Equality and Human Rights Commission on broader issues of caste and caste-related discrimination.

Noble Lords will also see that there is a further element in the Motion. We have provided for the possibility of a review of the exercise of the caste power and any order made under it. This safeguard is in response to the various concerns raised by parliamentarians of all parties, here and in the other place. It looks beyond any immediate need for caste legislation, and concerns the importance of ensuring that legislation does not inadvertently embed in British society the concept of caste, together with those aspects of it that are inappropriate to the modern world.

We see no place for caste in today’s Britain, and we want caste distinctions to disappear over time. This power gives us the opportunity to review the ongoing need for such legislation to remain, together with a means for its removal should it no longer be considered appropriate. As I have already said this evening, the Government have listened carefully. We are committing to legislate after we have carried out the consultation which this House has recognised to be necessary, before we exercise the power to make caste an aspect of race in the Equality Act 2010. We are also putting in place the option to review that legislation after it has been enacted. I trust that noble Lords will accept these proposals, one of which mirrors an earlier proposal put forward in this House. The other picks up on a suggestion put forward by the Opposition, among others. I beg to move.

Enterprise and Regulatory Reform Bill

Viscount Younger of Leckie Excerpts

Monday 22nd April 2013 Lords Chamber

Moved by

[Baroness Stowell of Beeston]

That this House do not insist on its Amendment 36, to which the Commons have disagreed for their Reason 36A.

Motion B1

Moved by

--- Later in debate ---

Moved by

[Baroness Stowell of Beeston]

That this House do not insist on its Amendment 37, to which the Commons have disagreed for their Reason 37A.

[Baroness Stowell of Beeston]

My Lords, we come now to the issue of caste and whether it should be made an aspect of race and thus a protected characteristic under equality law.

The whole House agrees that prejudice and discrimination based on caste is wrong. It is unfair and unacceptable in a modern society and is certainly unacceptable in Britain. There is no place for it and we need to take the right action to ensure that there is no place for it. It was your Lordships’ view when we last debated this that caste should be directly and immediately included in the Equality Act as an aspect of race. The other place has taken a different view and said we should not legislate at all without further consultation. There has, as yet, never been a full public consultation on this issue.

I will be absolutely clear. The Government have listened to what your Lordships’ House has said. We acknowledge the widespread support among noble Lords for legislation and the strength of opinion that has already been expressed. Today, I will explain the additional steps the Government are taking in response to the strength of that opinion. Since we last debated this matter, significant concerns have also been expressed about the implications of legislation. These concerns have not come only from those we would expect to be against legislation. Her Majesty’s Opposition also raised legitimate and serious questions during the debate in the other place. As I said during our earlier debates, this Government are not against legislation as a way of tackling caste discrimination. However, we do not have all the information that we believe is necessary to decide that the power in the Equality Act 2010 should be exercised. We think a responsible Government should consider all relevant issues and the implications of legislation before going down that route.

During our previous debate, my noble and learned friend Lord Mackay of Clashfern suggested that having the provision for caste in the Equality Act had given the courts reason, which they might not otherwise have had, to doubt whether the existing legislation protects people against caste discrimination. This helps to illustrate a very important point. We must ensure that whatever we do next does not create new, unintended consequences which could make it harder for people to seek redress. However, at the same time, we must of course be conscious of the need to bring what we do next to a conclusion as quickly as possible.

If we are able, shortly, to reassure ourselves on these points and decide, after consultation, to exercise the power that already exists in the Equality Act, then an advantage of this power is that we can do so via secondary legislation. In other words, I want to reassure your Lordships that there need not be a requirement for new primary legislation and therefore any unnecessary delay. I should note, however, that the amendment brought before the House today would not permit any meaningful public consultation or allow any flexibility through secondary legislation in the way that the Opposition, among others, have been arguing. Caste would simply join colour, nationality and ethnic origin as an aspect of race in the Act, and that would be that.

In a moment I will explain what additional information and steps we think are necessary before the Government will decide, and what the timescale is for that decision. First, I shall summarise some of the concerns that have been raised. First, there are concerns about whether we are actually legislating on the right ground. Some organisations have suggested that descent is more appropriate than caste, and this is an issue that the Opposition have also raised in debates in the other place. I am aware that there are differing and strong views on the question of descent, which we cannot go into today. However, the fact that there is genuine uncertainty over the definition of what we are legislating about clearly suggests that we should not be adding further to the law before carrying out the sort of consultative process proposed by both the Government and the Opposition, although I acknowledge that the Opposition have a different proposal in terms of consultation.

There are also concerns about individuals having to indicate their caste in any monitoring. The NIESR report is clear that some people would not want to do this or indeed admit to caste existing at all. We all have to consider what business would need to do to comply sensibly with such a provision and, if so, what costs this would entail. Would there need to be a code of practice, and if so, would it be reliable in such sensitive matters? To take one important stakeholder in this area, the CBI has stated that,

“on this terribly complex issue time must be taken in order to craft the right intervention, rather than rushing the process in order to comply with the timetable of the ERR Bill”.

At the moment, I believe it is not clear that we have all the information that we need on these and other questions. A significant number of Hindu and Sikh organisations, including some representing people from the perceived lower castes, have expressed concerns that they have not had a chance to provide considered views and would be strongly opposed to immediate legislation on this. For example, the GAKM UK which represents the Mochi community, which is deemed one of the lower castes, believes that by enacting the clause in law, the Government could undo all the work done by our communities over the past 20 years to try to remove the differentiation by caste in all aspects of life.

I am, of course, aware that some noble Lords may say that this is the sort of argument that could have been used to delay the advent of race or indeed of any other discrimination law. However, there is a fundamental difference with caste in that not only do we wish to get rid of caste prejudice from British society, we actually see no useful value in caste itself, or of anyone defining themselves by their caste. In that sense it is not like colour or ethnic origin, or any of the other protected characteristics. We need to ensure that the action we take, particularly if in legislation, sets us towards this aim and not in the opposite direction of embedding caste as a concept in domestic law.

As your Lordships will be aware, on 1 March this year, the Government announced a programme of educational work within the affected communities. At that time we also said that the Equality and Human Rights Commission will investigate the right way of tackling the problem of caste prejudice and discrimination, using the evidence in the NIESR report and earlier material from ACDA and other groups as its starting point. In last week’s debate in the other House, the Minister for Women and Equality announced that in parallel with this work a public consultation will be undertaken on the use of the caste power in the Equality Act. As I have already stated, a full, balanced public discussion is something that has not previously happened, and we think it is crucial that it now does so.

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Moved by

[Viscount Younger of Leckie]

That this House do not insist on its Amendment 38 and do agree with the Commons in their Amendments 38A and 38B to words so restored to the Bill.

[Viscount Younger of Leckie]

My Lords, this is an issue that has already been debated in some detail. Noble Lords will recall that the Government were nearly successful in persuading the House to accept the vote on Report, losing by the smallest of margins—indeed, by just two votes. Nevertheless I reassure noble Lords that the Government have listened to and carefully considered both the extensive arguments made, and the heartfelt concerns expressed, about the possible effects of this change. However, the Government feel strongly that a measure to reassure business is necessary, and the other place clearly endorsed that view by a majority of 75 when it voted on this issue last week.

This measure is one of a number of reforms designed to address the much wider issue of the perception of a compensation culture and the fear of being sued that this generates. It is a fear that drives employers to overimplement the law, incurring unnecessary costs, and that undermines their confidence to grow and develop their businesses. It is a problem that I believe we all recognise needs to be tackled, and one that we have not only considered in relation to this clause but, as many noble Lords will recall, debated in some detail in relation to my noble friend Lord Young of Graffham’s report Common Sense, Common Safety. It is because of this wider context and its detrimental effect that the Government remain of the view that it is not reasonable or fair that employers should be held liable to pay compensation when they have done nothing wrong and taken all reasonable steps to protect their employees.

We acknowledge that this reform will involve changes in the way that health and safety-related claims for compensation are brought and run before the courts. However, to be clear and to avoid any misunderstanding that may have arisen, this measure does not undermine core health and safety standards. The Government are committed to maintaining and building on the UK’s strong health and safety record. The codified framework of requirements, responsibilities and duties placed on employers to protect their employees from harm are unchanged, and will remain relevant as evidence of the standards expected of employees in future civil claims for negligence.

As I set out on Report, the clause provides for a power to make exceptions. It is already planned to make such an exception in respect of pregnant workers in order to comply with the terms of the relevant EU directive. We have thought carefully about whether there are more exceptions that should be made at this stage, but have not identified any other examples. However, I assure the House that we will seriously consider any further exceptions that are suggested.

To be successful in providing the reassurance that businesses need to overcome their fear of being sued, we need to take decisive action that will send a clear and effective message. The Government believe that the proposed single amendment to the Health and Safety at Work etc. Act achieves this by providing a consistent approach to civil litigation across all health and safety legislation, which will be simple for both employers and employees to understand.

To clarify a point of detail, I should also explain that amendments regarding the words “so restored to the Bill” have the effect of reinstating government amendments agreed without objection in Grand Committee. These amendments were made to comply with the Delegated Powers and Regulatory Reform Committee recommendation to remove a new regulation-making power that had been inserted as proposed new Section 47(2B) of the Health and Safety at Work etc. Act. The Government reflected on the committee’s comments and accepted that it was not necessary to take such a power, as there are no current plans to extend the policy to other legislation.

For the reasons that I have set out, I ask that noble Lords do not insist, as the noble and learned Lord, Lord Hardie, asks, on their Amendment 38. I beg to move.

Motion D1

Moved by Lord Hardie

As an amendment to Motion D, leave out from “House” to end and insert “do insist on its Amendment 38”.

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[Viscount Younger of Leckie]

My Lords, I have again listened with interest to the arguments made and thank noble Lords for their careful consideration of this very important issue. I start by challenging the noble and learned Lord, Lord Hardie, and the noble Lord, Lord McKenzie, on whether there is a compensation culture. The noble and learned Lord raised that point. I clarify again that my noble friend Lord Young and Professor Löfstedt underlined that health and safety regulations, more than any other area of regulation, suffer from misinformation and overcomplication in the media and elsewhere. I was grateful for the intervention by my noble friend Lord Faulks on this issue.

As Professor Löfstedt found in his independent review, these myths lead to confusion about what the law requires and a fear of being sued which drives employers to overimplement the law in an effort to protect themselves. This does not lead to better protection for employees but means that employers are spending significant time and resources on activities and services which are not necessary or far in excess of what the law requires. Concern about “getting it wrong” discourages employers from looking at ways to develop and grow their business and consequently from taking on new employees. I reiterate to the House that this is a real issue and that there is a perception in this regard. We believe as a Government that we should be tackling it.

The noble and learned Lord, Lord Hardie, referred to certain cases which were raised in the other place by the honourable Member for Middlesbrough. We have been able to check the facts of two of those cases. In both of them there is prima facie evidence of negligence on the part of the employer. We would expect that such cases would still be brought as negligence claims if brought after this amendment to the Health and Safety at Work etc. Act. It is important to clarify that point.

The noble and learned Lord, Lord Hardie, mentioned removing the right to compensation and depriving families of it in the event of an employer’s breach of statutory duties. The Government’s view is that it is fair and reasonable that this burden should be removed from an employer who has done nothing wrong. The fact that someone has been injured at work does not mean that they are automatically entitled to compensation. Ours is not a no-fault system. Many health and safety duties require the injured employee to show fault on the part of their employer. It is interesting to note that currently claimants do not recover compensation in about 30% of claims.

There can be cases of misfortune to which I alluded on Report, which cannot and should not be laid at the employer’s door. In order effectively to tackle the fear of being sued and of unjustified reputational damage, and the costly burdens on business this brings, employers need to know that they have a fair opportunity to defend themselves.

The noble Lord, Lord Pannick, spoke of the burden of proof shifting to the employee, as he put it, being unreasonable. However, the cases that will be most significantly affected by this change are those which would have previously relied on an absolute or strict liability duty. Under the existing system, employees have to prove that their employer breached the standard required in the regulations and that the breach caused the injury. In practice, the issues and evidence that will need to be examined in relation to a claim for negligence will be similar to those currently examined in relation to a claim for breach of a duty which is not a strict one and qualified by, for example, the wording,

“so far as is reasonably practicable”.

That point was raised earlier. Indeed, most cases are currently brought for both breach of statutory duty and negligence, so it is anticipated that most claims will still be able to be brought.

The noble Baroness, Lady Turner of Camden, said that a different approach had been taken to Professor Löfstedt’s recommendation. The Government agreed with Professor Löfstedt’s recommendation in principle, recognising the unfairness which results where employers are liable to pay compensation regardless of having taken all reasonable steps, and agreed to look at ways to redress the balance. Excluding civil liability only in relation to specific strict liability offences would mean making a large number of amendments to more than 200 regulations and could result in different approaches to civil liability being applied within a single set of regulations and across the regulatory framework. This would add a layer of complexity to the current system leading to greater uncertainty for both employers and employees about the duties that apply in respect of compensation claims. Making a single amendment to the Health and Safety at Work etc. Act has the significant advantage of delivering a consistent approach across all health and safety legislation.

I reiterate that this reform is not about reducing the number of claims made, but about establishing the important principle that employers should always have the opportunity to defend themselves against a compensation claim when they have done nothing wrong and have taken all reasonable precautions to protect their employees. By providing the reassurance that they will not be liable if an accident happens which is totally outside their control, this change will support responsible employers who take care to protect their employees by giving them the confidence not only to take sensible steps to manage health and safety risks but also to expand their businesses into new areas and activities and to take on new employees to achieve this. The Government believe this to be a fair and proportionate response to the impact that strict liability duties currently have in the civil litigation system.

Business is fully behind the need for action in relation to the perception of the compensation culture. More specifically, it is supportive of the approach that the Government want to take in relation to the issue of strict liability duties. I am most grateful to my noble friend Lord Faulks for his succinct intervention, backed by his experience in the field. This support was also reaffirmed by both the British Chambers of Commerce and the Federation of Small Businesses in correspondence received in the last few days. I therefore ask again that noble Lords do not insist on their amendment on this issue.

[Lord McKenzie of Luton]

Before the Minister sits down, can he just help us with one issue? If it is the Government’s position that the problem to be addressed is the perception of a compensation culture, why should that be addressed by making the reality of accessing compensation claims more difficult?

[Viscount Younger of Leckie]

I reiterate that the balance is not right. We have been much helped by the report from my noble friend Lord Young and Professor Löfstedt, who have provided this perception and provided the evidence to allow us to act. This is the right approach for the Government to take.

[Lord Hardie]

Does the Minister accept that regulations that have the qualification of reasonable practicability afford an employer the opportunity of defending himself against a breach?

[Viscount Younger of Leckie]

The noble and learned Lord makes a fair point. Employers will continue to need to have to defend themselves. The issue depends entirely on the particular case in hand but this government action redresses a balance that is long overdue.

[Lord Faulks]

Before the Minister sits down, I am sure he will agree that, while some of the regulations have the defence referred to by the noble and learned Lord, quite a few of them do not provide this defence at all and there can be automatic liability without any fault. Does he agree that one of the problems of the perception of a compensation culture—there was perhaps an inadvertent hint of this—is the fact that these changes are not welcomed by safety consultants or those who are concerned to gold-plate some of these regulations?

[Viscount Younger of Leckie]

I am grateful for the points made by my noble friend. That is a very helpful intervention.

[Lord McKenzie of Luton]

Can the Minister give us some examples of where there is gold-plating of regulations under health and safety provisions?

[Viscount Younger of Leckie]

I believe that I covered in Committee and on Report all the aspects that I need to.

[Lord Hardie]

I am grateful to noble Lords for their contributions to this short debate. I note that the Minister and the noble Lord, Lord Faulks, accept that there are a number of regulations which have the qualification of reasonable practicability. Those regulations afford the employer the opportunity of defending his actions by saying, “I complied with these regulations so far as was reasonably practical”. If he proves that to the satisfaction of the court then he will avoid liability.

That brings me back to a point that I sought to make earlier. Why should a right of action be excluded from those regulations? If the intention of the Government is that employers should not be blamed for something that they have not done and should have an opportunity to defend themselves, then the qualified regulations do precisely that. There is no justification in law or in logic for removing the right of action in those regulations, which, as I have said, comprise the majority of the regulations.

I am grateful to the noble Viscount for researching the cases mentioned in the other place by Mr McDonald. I accept what the Minister said—that two of the cases would have succeeded at common law, contrary to what Mr McDonald said. However, according to the Official Report, there was a specific finding by the court that there was no common-law liability in the case of the roofer and slater, Mr Hill, who,

“fell from scaffolding during the course of his work and suffered very serious injuries resulting in incomplete tetraplegia. The accident occurred as he came down the scaffolding on a portable ladder that was not fixed or in any way secured; he fell to the ground, causing the injury. His injuries were so severe that damages were agreed at just under £2 million. The court held that there was no liability at common law, but there was liability under the Work at Height Regulations”.—[Official Report, Commons, 16/4/13; col. 236.]

That is a specific example of a case where common-law liability was unsuccessful but the plaintiff managed to secure damages because the employer had failed to comply with regulations designed for the safety of his employees and that failure was the cause of the accident. If Clause 61 had been in force, Mr Hill would have received no damages because he would have failed to have established his common-law claim for negligence.

The issues have been well canvassed and I feel strongly that this clause interferes with a fundamental right. No justification has been put forward for it and the Commons has not really considered the Lords’ discussions on this matter and has given no reasons for disagreeing with Amendment 38. I would welcome the opinion of the House.

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That this House do not insist on its Amendment 40 and do agree with the Commons in their Amendments 40A to 40H.

[Viscount Younger of Leckie]

My Lords, on Report we debated the amendment in the name of the noble Baroness, Lady Hayter, on letting and managing agents. I made it clear then that the Government could not accept her amendment but that we were giving most serious consideration to the issue of redress. The noble Baroness confirmed that it was a redress mechanism that she was seeking in her amendment.

The Government have given serious consideration to these issues. We have considered reports by the Office of Fair Trading, Which?, the Royal Institution of Chartered Surveyors and others, and we have listened carefully to the debate here and indeed in the other place. The Government recognise that the fact that not all agents belong to a redress scheme has been an issue of growing concern. We are satisfied that making this a requirement would provide both the means of addressing complaints when things go wrong and a means to improve service quality across these important parts of the housing sector.

Providing access to redress would deal with many of the failings that people are concerned about in their day to day dealings with letting and managing agents. At the same time, the existing consumer protection and leasehold legislation remains in place and is already available, and is indeed used for the more serious matters.

Having listened to the concerns raised most specifically in this House by the noble Baroness, Lady Hayter, and others, including my noble friend Lady Gardner, the Government have introduced in the other place an amendment in lieu of the amendment tabled by the noble Baroness, Lady Hayter. The government amendment gives powers to require letting and managing agents of privately rented and residential leasehold homes to belong to a redress scheme. It gets to the heart of what the noble Baroness, Lady Hayter, was seeking, but without subjecting letting and managing agents to the additional layers of regulation that are in the Estate Agents Act and on which her amendment was based.

I am pleased to say that, while clearly some would have liked the Government to have gone further than redress, this amendment has been warmly welcomed and was approved without Division in the other place. Indeed, the honourable Member for Streatham, shadow Business Secretary Chuka Umunna, described it as,

“a victory for tenants and landlords””.—[Official Report, Commons, 16/4/13; col. 229.]

The Government’s approach has also been welcomed by key organisations. For example, the National Approved Letting Scheme welcomed it as a common-sense approach to improving the consumer experience of renting and letting and a sensible alternative to the heavy-handed bureaucracy of a formal regulatory regime. Similarly, the National Landlords Association has endorsed the Government’s approach of meeting the challenge of regulating letting agents head on, rather than simply applying the standards of estate agency to a distinct sector with its own significant risks.

If these clauses are enacted, the next steps will be for the Department for Communities and Local Government to consult on the details of the measures and to go through the formal scrutiny processes so that the necessary orders can be brought forward for approval in both Houses. We would expect consultation to be under way by the summer.

In their consultations, the Government will wish to take account of a number of the points that have been raised in the other place, for example on how existing codes of practice will be reflected in the redress schemes. There were also questions in the other place about the residential leasehold sector, generally echoing concerns that have been raised by my noble friend Lady Gardner of Parkes. The Department for Communities and Local Government is taking forward work on these issues, following its recent round table meeting, which my noble friend attended. I know that it will continue to involve my noble friend and a broad range of other interested parties on these matters.

My honourable friend in the other place, the Housing Minister, Mark Prisk, has spoken to the honourable Member for Worthing West about the points that he raised on the Leasehold Advisory Service and has now written to him.

The Government consider that this amendment can make a real improvement to the operation of letting and property management agents, for a very modest and proportionate regulatory burden. I am grateful to bodies such as the Office of Fair Trading and Which? for rightly bringing attention to these issues, and to noble Lords who have worked hard to bring these measures within the current Bill, in particular the noble Baroness, Lady Hayter, and my noble friend Lady Gardner. I also acknowledge my honourable friend in the other place, the Housing Minister Mark Prisk, who has a long-standing interest in this issue and has worked hard to deliver a workable redress mechanism within the current Bill.

I therefore ask that noble Lords do not insist on their amendment and instead agree with the other place on its amendments in lieu. I beg to move.

[Baroness Hayter of Kentish Town]

My Lords, I welcome and support Motion E. I pay tribute to a number of key players who have brought us to this happy position. First, there is the coalition of those interested in the well-being of tenants and landlords, as the Minister has mentioned, such as Which?, Shelter and RICS, which have given me a lot of help not only in drafting but in the persuasion, if I may say, of this House and then the Government, who perhaps were a little reluctant to start with but have made a very large step forward. The coalition that came together included representatives of tenants and landlords, as has been mentioned, but also the British Property Federation, the Mayor of London and various London councils, as well as the professional organisations to which some of these bodies belong.

The amendments in lieu are not exactly the whole of what the House asked for in passing my original amendment, in that they do not include a role for the OFT in debarring agents who go seriously astray. However, I am confident that with the build-up of intelligence by the various redress schemes, evidence will come to light on which the OFT or Trading Standards will be able to take action.

Furthermore, as happened with estate agents and as has been suggested in the consultation, ombudsmen will develop codes of conduct for letting and managing agents—based, no doubt, on the professional codes that they have in place now—to give member agents guidance as to how an ombudsman will decide a case. That is perhaps a backdoor way to the adoption of a code, but is very welcome for all that.

In due course, I and consumer groups will no doubt be asking for further regulation of letting and management agents if this measure proves insufficient to protect landlords and tenants, and I have a feeling that the noble Baroness, Lady Gardner, is not about to let this wider issue drop.

For the moment, I conclude by thanking our Lords PLP staff, Beth Gardiner-Smith, Sophie Davis and Ian Parker, for their help, and saying a very genuine thank you to both the Ministers who are with us this evening. They took a lot of trouble to listen to our concerns very carefully and—I am sure at some personal risk to themselves—battled with their colleagues at the other end to win through. This House has brought some good home sense to an issue that is of great importance to thousands of our fellow citizens.

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[Baroness Gardner of Parkes]

My Lords, I congratulate the noble Baroness, Lady Hayter. This is a great personal success on her part. She has been persuasive. She has managed to encourage us all by winning that important amendment, and without that we would never have got to this point where people have really looked at things and decided that something can be done.

As the noble Baroness said, this is not something that we are going to let die, or lie, because there is still so much more to be done. Another hopeful thing has been the new Minister for Housing. With experience and work in the field as a surveyor, he knows what we are talking about, and this has made a big difference, particularly when we have had various round-table meetings. People have adopted the attitude that they want to look into things further. We have been given hopes that that they will look into everything much further later in the year, and I will be pressing that in my questions. As you know, I am particularly interested in reducing the percentage of people required to have commonhold instead of leasehold, because that would solve a lot of problems, but everyone agrees that 100% is an impossible requirement.

I pay tribute to the two Ministers. My noble friend Lord Younger has done a great deal, and it is marvellous that he has allowed housing to come into this, which was such a BIS affair. I cannot speak too highly of my noble friend Lady Hanham, who knows the housing issue so well. It is due to her persuasiveness that we have managed to get things to this point and have received notice today of these amendments. As has been said, perhaps they do not deal with everything, but they go a long way and are a huge first step. That is what we need, and again I am delighted to welcome these changes.

[Viscount Younger of Leckie]

My Lords, I am grateful for the contributions to this short debate. We have heard a small number of contributions today on the amendment on the letting and managing agents. As we know, this is a practical measure that can be taken forward rapidly to make a real difference to the experiences of landlords, tenants, freeholders and leaseholders.

In an attempt to answer my noble friend Lord Sharkey’s question, although the timetable is unclear at the moment I am not out of step to say that we fully expect orders to be brought forward by the end of the summer. It might be earlier.

In conclusion, I commend this Motion to the House.

Motion E agreed.