Scotland: Underoccupancy Charge
Baroness Hollis of Heigham Excerpts(12 years, 3 months ago)
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Lord Freud
My Lords, I have seen the research to which my noble friend refers. Clearly, it is encouraging. I also note that the report by the Scottish Parliament states that in one area the case load has fallen already by 15%. As I said just now, we need to be cautious about early findings but this one clearly is positive.
Baroness Hollis of Heigham (Lab)
My Lords, the Minister has stated that the bedroom tax will release larger, underoccupied properties for the waiting list but 80% of those on the waiting list want the selfsame smaller properties as the underoccupiers who have priority. This report shows that it will take three years to rehouse underoccupiers. Will the Minister therefore accept that it is false to claim that the bedroom tax will help those on the waiting list? On the contrary, their waiting times will probably double.
Lord Freud
My Lords, I must make the point that while the party opposite likes to use the expression “bedroom tax”, it is deeply misleading. A tax is when you take away money that people earn. We are limiting the amount of money that the taxpayer pays to people. There are 1.4 million one-bedroom properties, which become available at the rate of roughly 100,000 a year. Quite a lot of people are likely to want to keep an extra bedroom because they have the resources and the desire to keep it. Therefore, there will be a period of adjustment, and we are going through it. We are spending the discretionary housing payment to allow that transition to happen in an orderly way.
Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013
Baroness Hollis of Heigham Excerpts(12 years, 3 months ago)
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Baroness Hollis of Heigham (Lab)
My Lords, I will follow the right reverend Prelate the Bishop of Ripon and Leeds in his point about going online. First, I want to say, as others have said, that I very much support universal credit and I am watching with wry horror now the number of people being taken to court for failure to pay the £2 or £2.50 owed on their council tax bills by virtue of the localised council tax system. One wishes that some other parts of the Government had listened to some of the debates that we had in Grand Committee on that subject.
Like others, I am concerned about where some of the cuts are going to fall. In particular, I remain worried by the disincentives to second earners, usually women, in couples whom we want to encourage to go back into the labour market. We increasingly make it less financially worth while that they should do so. I think that is very foolish indeed.
However, my biggest concern has been not just the payment problems, which my noble friends Lady Lister and Lord McKenzie have mentioned, but the assessment issues associated with them. Perhaps I may remind the noble Lord that, as far as I am aware, most of the pathway schemes and experiments so far have been with younger people in urban areas. They are more likely to be IT-literate and more likely to have access to IT facilities. I am chair of a housing association that runs across a rural county. A substantial proportion of my older tenants have no access to WPs. Of those who do, only 14%, when I had my last tenants’ conference, actually used them for financial matters, such as the handling of bank accounts and so on. In order for those other tenants to be able to claim universal credit, they have somehow to access a WP. I have four centres across the county of Norfolk—in King’s Lynn, Norwich, Dereham and Great Yarmouth, and possibly North Walsham, but we will see—in which we will set up local offices. There will be terminals and there will be people to guide people through their applications. That is fine, except that people may have to go on something like a 15-mile bus ride to make their application. Because it is a paperless system, they will not be able to correct any mistakes online. They will not be able to answer any queries about the information. They will not be able to follow it up because they will be back home.
I tried to see whether there was any way I could bring IT facilities to people in that situation. I considered, for example, whether I could provide terminals in people’s homes inexpensively, possibly through a leasing system. Yes, I could, except that those same tenants cannot afford to pay the broadband or dial-up charges. So I cannot put them online in their homes. I then thought about whether I could in some way get them smartphones to give them some online access. No, they cannot afford the charges of smartphones. So they cannot afford to go online. Indeed, in some parts of Norfolk you cannot even get access to broadband, but that is another matter. We have only 90% coverage, so sod the 10%. No doubt they will get their money somehow. None the less, in large parts of Norfolk, there will be a large number of people who have no access to terminals in their home or to a smartphone, who have no computer skills, who have to go into a local centre, and who, if any mistake is made, will have no ability to correct it.
You may think that assessment will be only once a year or once every six months and therefore this is a minor problem compared with the payment issues. I hope that is right, but one of the crucial reasons why the old CSA computer toppled over, which was at the core of the failure of the CSA to deliver the service it should have delivered, was that half of all lone parents had more than 12 changes of circumstances in a year. They were largely associated with changes in childcare at each holiday period because it did not fit the school’s working time or the mother’s work patterns. You can get real-time information from an employer about income, but you cannot get real-time information in the same way for ever-changing childcare bills. That means that that lone parent or that couple will have to reassess, reclaim and adjust their UC online as it is going to be paperless. Will the Minister tell me how I should respond to this? I have hundreds of tenants who at the moment have no IT skills, no access to gaining them, although I am trying to do crash courses where people are willing to take them, no terminals at home, no ability to afford dial up if it were to exist and no access to phones. How are they going to input the information they need to input to get the money they are entitled to? I would be glad of some help on this point.
Lord Kirkwood of Kirkhope (LD)
I shall make a short contribution to this important debate. I am grateful to the noble Lord, Lord McKenzie, for introducing it. Using a Motion of Regret is clunky, but this is important. I shall start with a question about parliamentary process. Things have changed since the old days. In my experience of parliamentary change of this kind, Bills were much less far reaching and were implemented over a much shorter timescale. After the six-month period of purdah, Ministers could always explain the unfolding of the regulations that flowed from the primary Act. We are getting to a stage where we are paying more attention to guidance rather than to statutory instruments. Statutory instruments are becoming almost as skeletal as the primary legislation. Therefore, how are parliamentarians able to keep up with what is going on, particularly when this is at least a five-year implementation phase? I think it would be a good trick if the Government could achieve it in a five-year period.
In parenthesis, I want to strengthen the Minister’s hand. Speaking for myself, I am much more interested in getting this universal credit reform right than I am in sticking to any timetable, political or otherwise. I have next to no interest in what will happen in May 2015 compared with this important legislation. It is transformational architecture, but because it is transformational, it is difficult to deliver for reasons that we have heard.
It is not just that it is taking five years to do. It is now intimately engaged with other government departments. HMRC is the prime one, but not the only one. There is also DCLG—is it DCLG or DCLM?
Lord Kirkwood of Kirkhope
Thank you. I am Scottish. Luckily it does not apply to me.
Lord Kirkwood of Kirkhope
I know.
We have a lot of extra heavy lifting to do to try to make sense of what is going on. If that was not enough, we have for the first time a completely transformational application of ICT technology in digital delivery. All that means that this has to be done slowly and sensitively. I would like to think that the kind of flexibility that the Minister showed in the seminal Committee stage of the 2012 Act is still available to us because if he is not sensitive to the sort of things that are being raised he risks prejudicing public perception of what he is trying to do, as the noble Baroness, Lady Lister, said.
I am absolutely certain that the vast majority of people who will need to take advantage of universal credit in future are literate and have internet access. We know from government research that the penetration of digital technology is increasing and will continue to do so. It is the two lowest deciles of income distribution in terms of household income that I continue to lose sleep about—people who earn less than £10,000 a year. We have been hearing about some of these acute problems and they are just as acute as they were in 2012. I understand that we have to hasten slowly to get this right, but we have to find a better way of informing Parliament about what is going on. I think the next set of detailed guidance that we can expect—my spies tell me and my spies are everywhere—will be in the late summer of 2014 and the next substantial rollout might not be until the spring of 2015. How are we, as parliamentarians, to keep up with what is actually going on? Reading the newspapers is not always helpful because, although they can highlight some of the problems, they do not tell the whole story.
I make a plea to the Minister. Can he think about ways of dealing with this other than Motions of Regret? It is a game we can all play, and we could do it every month if we had to, but I think there is a more grown-up way of accepting that, for the next two years and, indeed, for the rest of this Parliament, there will be periods when the Government could find a parliamentary opportunity for us to have a sensible discussion, be given reassurances and ask these detailed questions which are so important, not just to us, but to the people outside.
I agree with everything that has been said about the monthly payment, particularly by the noble Baroness, Lady Lister. That is probably my biggest worry. I know that she has more expertise than I about the split payments, but I listened carefully to what she had to say and I think that her questions deserve answers. The additional problem of behavioural change, on top of everything else, is something that is too dangerous, and I wish we were not doing it at all. Maybe we could do it in future, when this gets straightened out, but it is too risky to do it in this way.
My final point before I sit down, because it is late, is that the SSAC has done a very good job. I still remember the long look I got down the ministerial nose when I suggested this at the beginning. This was my idea, because I thought it would help. Luckily, the Minister eventually took my advice. The SSAC has done a remarkable job and I hope that the Minister will continue to involve it. Although it does not have any statutory control over guidance, if we get to the position where guidance is needed, such as in the definition of what is vulnerable, and we cannot get that clear with the stakeholders that the SSAC knows and works with so well, then we will be lost when this gets implemented. I hope that the Minister will give us an assurance that the SSAC will have a key and continuing role in this evaluation and monitoring process. Otherwise, it will be more difficult to achieve successfully.
Housing: Under-occupancy Charge
Baroness Hollis of Heigham Excerpts(12 years, 3 months ago)
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Baroness Hollis of Heigham
To ask Her Majesty’s Government what advice they give to social landlords whose tenants have fallen into arrears as a result of the under-occupancy charge.
Baroness Hollis of Heigham (Lab)
My Lords, I declare an interest as chair of a housing association and I beg leave to ask the Question standing in my name on the Order Paper.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, social landlords had more than a year to design, develop and deliver strategies to mitigate the effects of under-occupancy and were advised to start building responsibly to avoid driving people into arrears. Prior to implementation, the Government, working collaboratively with the Chartered Institute of Housing, produced specific guidance for landlords, Making It Fit, and continue to fund its Making Best Use of Stock team, which assists landlords to find suitably sized accommodation for tenants. Fact sheets containing advice on home swaps, money management, payment options and how to look for and find work have also been issued. To be clear, 60% of those requiring social housing are single or couples without children, but over the last decades landlords have ignored this fact, resulting in larger homes being built, even though the greatest need is for smaller properties. Finally, £190 million has been provided this year to help vulnerable claimants.
Baroness Hollis of Heigham
My Lords, a recent sample shows that half of all affected tenants are in arrears and that three-bed houses are now hard to let. Do we move tenants to smaller accommodation? It cannot be done because there is none. Do we increase income with discretionary payments? For the 90% who are ineligible, it will not be done. Do we allow arrears to soar? As this could send us into the red, it should not be done. Or do we evict vulnerable families from their three-bed homes into temporary accommodation, back into an unwanted, hard-to-let, three-bed house? That can be done if we ignore the futility, misery and cost. Which of these options does the Minister favour?
Lord Freud
My Lords, it is simply premature to come to any conclusions as to the level of arrears. We will, of course, provide that information when we have the kind of reliable information that this House requires me, as a Minister, to deliver. There have been various surveys, but the samples are just too narrow. There are 1.4 million one-bedroom properties in the social rented sector and we are looking to have those managed more efficiently. I remind noble Lords that the scare stories about what would happen to our LHA reforms were very similar to the kind of stories that are being propagated now and we have not seen any poor reaction in terms of homelessness as a result of those reforms.
Housing: Under-Occupancy Charge
Baroness Hollis of Heigham Excerpts(12 years, 4 months ago)
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Lord Knight of Weymouth
To ask Her Majesty’s Government whether they have any plans to suspend the under-occupancy charge.
Baroness Hollis of Heigham (Lab)
My Lords, on behalf of my noble friend Lord Knight of Weymouth, and at his request, I beg leave to ask the Question standing in his name on the Order Paper.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, there are no plans to suspend the removal of the spare-room subsidy policy. A formal evaluation of the policy is being carried out; this has already commenced and will be conducted over the next two years. To support people transitioned to this reform, we have more than trebled the discretionary housing payment fund to assist those facing extreme difficulties.
Baroness Hollis of Heigham
My Lords, two-thirds of the families affected are disabled—fact. Half of those in a recent sample are already in arrears—fact. Most local authorities are limiting discretionary payments to three months only—fact. Furthermore, there are no smaller properties to move to—fact. So disabled families cannot work, pay, obtain financial support or move. When will the Government have the guts to admit that their policy is impossible as well as cruel and follow our commitment to repeal it?
Lord Freud
My Lords, there were a lot of issues buried there. I will just point out that, when you look at the disabled figures, and if you look at the people on DLA, which is an independent measure, the figure comes down to 27% of the total. For those with the higher rate of DLA, it is 17%. I also remind the Opposition that this is a substantial saving measure. Some £500 million has to be found, and there is a degree of cynicism about whether you can find that through closing tax loopholes. I also ask the Opposition a question—
Property: Under-occupancy Charge
Baroness Hollis of Heigham Excerpts(12 years, 7 months ago)
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Lord Freud
My Lords, the purpose of DHPs specifically for the disabled in heavily adapted houses and homes is to make sure that they can stay there indefinitely. Clearly, it would not make sense for people to move when there would be a high cost of adapting a new premise. As I have said, it is too early to know what is happening in different local authorities. The information I have up to now from our intensive interrelationship with local authorities on this matter is that there is a great deal of variation in outcomes.
Baroness Hollis of Heigham
My Lords, the Minister assumes that the Government will make £490-odd million of savings from the bedroom tax on the assumption that most tenants will stay put and take the hit. That is where the saving is coming from. However, all the evidence from housing associations, including my own, and local authorities shows that something like 30% of tenants will move, largely into the private rented sector, where rents, and therefore housing benefit, will be higher. Does the Minister accept that to send 660,000 families into misery for the sake of something like £50 million of net savings in the public sector is not only cruel but profoundly indecent?
Social Security (Disability Living Allowance, Attendance Allowance and Carer’s Allowance) (Amendment) Regulations 2013
Baroness Hollis of Heigham Excerpts(12 years, 7 months ago)
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Baroness Thomas of Winchester
My Lords, I am extremely grateful to the noble Lord, Lord Alton, for giving us this opportunity to raise again the issue of PIP and the higher rate mobility component. This, of course, is the gateway to the Motability scheme which enables so many disabled people—including myself—to get about. I declare that interest.
I shall say a word about PIP in general, but turning to these regulations, I am pleased that Motability has stated that it aims to avoid recovering vehicles from hospital in-patients affected by this change. If the car has been adapted to suit the claimant’s condition, then it could be very expensive for a Motability car to be recovered and for the claimant to apply again when he or she comes out of hospital, and another Motability car has to be adapted in due course. Presumably the payment of the higher rate mobility component of DLA will continue to be paid if a person is in hospital for more than four weeks. Perhaps the Minister could tell me if that is the case.
Turning to other matters, I am very glad that the DWP is reopening the consultation which it failed to do on the final version of the PIP criteria. Even though the amending regulations should make the position clear, none of us who has taken part in these discussions has any confidence that the assessors will properly take the criteria in the amending regulations into account—even though they are mandatory. I hope that the new consultation will not be an empty exercise and that the DWP will take on board what disabled people say and change the original criteria if the consultation makes it clear that this should happen.
One matter which I am very disturbed about is the figure of 600,000 claimants that the Government say will disappear from their books once PIP is introduced. Where did the DWP get this figure from? Is it saying that these people are not disabled enough, or that they are now receiving DLA fraudulently? How closely is it in touch with the Department of Health, which might be able to enlighten it about improvements in treatments for many disabled people, meaning that they are likely to live longer with their disabilities?
The mantra we hear constantly is that PIP is to be targeted at those who need it most. However, although that sounds good and right, it is actually pretty meaningless because DLA and PIP are not to be means-tested. So one is left with a subjective judgment by a DWP decision-maker—heavily influenced by the assessor. Without targets, how will the decision-maker judge one person against another? Outside the Chamber, the noble Lord, Lord Alton, said they would need the judgment of Solomon. Instead, they have the judgment of Atos. I know which I prefer.
Tonight we heard more from the noble Lord about the Atos contracts, so I shall not repeat those facts, which are very disturbing. In general, I supported the move to PIP, because of the inadequacy of the DLA form, but there are too many question marks over the whole process for me to have any confidence in it any more.
Baroness Hollis of Heigham
I want to make three brief points, but first declare an interest. Two members of my extended family have Motability cars and they are their lifeline. I shall make a point about statistics, one about appeals and finally a point about isolation. I shall try to be quick because we are pressed for time.
On statistics, as I recall when we were doing the Welfare Reform Bill, we were told that something like 600,000 of those getting the higher rate DLA mobility component would drop and about 200,000 of those on a lower rate would go up, leaving a net loss of 400,000 people on DLA mob. As understand it from our debates at the time, something like 27% of those people converted their DLA higher rate mob into a car. Therefore it means we are talking about the loss of potentially 180,000 Motability cars from disabled people who are dependent upon them. These are cars which in many cases have been extremely expensively adapted to them and therefore are of relatively little use for people following after, because they have been customised. This leaves the disabled person without any ability to afford alternative transport, because they too cannot afford those adaptations done by Motability. So on my first point about statistics, I think we are dealing with about 180,000 cars. If the Minister can correct me on this, I should be pleased to know, but it is a huge number.
Secondly, there are appeals. At the moment, between 40% and 50% of all appeals on DLA are successful. One reason is that there is often a considerable time between the DLA assessment and the appeal, by which point someone may have got worse or, possibly, better and, as a result, the evidence is contested. The problem is the length of time taken to hear the appeal. If it takes six months to hear an appeal against Atos, you lose your car after one month, you win your appeal, but then you have to wait for a new car with all the expensive adaptations while 180,000 cars are effectively on the scrapheap, that seems a foolish and unwise use of money.
Baroness Hollis of Heigham
The Minister knows what the figures were in the past; why can he not project them forward? I am relying on memory now, of debates we had 18 months ago, but am I not right in thinking that he told us at the time that something like 29% of those in receipt of higher rate mobility turned it into a Motability vehicle. If that figure is correct, which I believe it to be, then he can surely extrapolate that to the numbers of gross losers coming down from high rate DLA mobility, which I understand, again relying on memory, was 600,000. Therefore, 29% of 600,000 brings me to my 180,000 figure. What is wrong with that figure?
Lord Freud
The reason that it is wrong is that we do not know that the Motability figure lines up at that same percentage into the mobility. That is the reason. As a rule of thumb, it is one way of going, but we actually do not know whether or not the kind of people who will maintain their higher rate mobility will be the ones with Motability. That is the issue.
One of the questions that the noble Baroness was particularly concerned about in this area was the heavily adapted cars, and I think she described it as the foolishness of moving a heavily adapted car back. I emphasise that only 2% of Motability cars are heavily adapted, so this is a much smaller problem; most are just standard cars.
Baroness Hollis of Heigham
I was a patron—or something or other—of Motability, and that is certainly not my experience. They may be standard cars but they have been adapted to make them comfortable. Even people who drove ordinary cars beforehand transferred to a Motability car in order to get the adaptations and so on which made it comfortable as well as possible for them to drive. Obviously I am in no position to argue with his 2% figure, but I suspect from my own experience that another 20%, 30% or 40% will be using a Motability car which, to some extent or other, has been personalised or tailored for their use.
Lord Freud
My Lords, I do not think we have time to debate what heavily adapted comprises. However, the figure for cars heavily adapted for a disabled person is 2%. Clearly, we all personalise cars to some extent. I can let the noble Baroness have some more information on that to the extent that I have it, but that is the figure that I have. I confirm that the noble Lord, Lord Sterling, is looking carefully at how Motability can help to mitigate the impact for those who may be affected by the move to PIP.
Marriage (Same Sex Couples) Bill
Baroness Hollis of Heigham Excerpts(12 years, 7 months ago)
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Baroness Knight of Collingtree
I, too, strongly support what the noble Baroness, Lady Deech, has said, and I supported the noble Baroness, Lady O’Cathain, in her earlier efforts. It is extremely disappointing to be told, “Not now, another time” or, “Not tomorrow” or, “In a little while”. How do we know that it is going to be a little while? We have no idea. Reviews do not normally take a little while and even then they may not be successful.
I do not doubt the sincerity of the noble Lord, Lord Alli, and his genuine support for the idea behind this, but we are told every time, “Yes, we agree with what you say but this is not the vehicle in which to do it”. What we need to be told is, if this is not, what is? We need some idea of that because the injustices mount as the years go by. Many people, who would have been helped if the original amendment had gone through, are now gone. They are dead, finished; they faced burdens which they need not have faced. I, for one, am not prepared to sit here year after year and hear, “Tomorrow, tomorrow, tomorrow”. Tomorrow never comes.
Baroness Hollis of Heigham
My Lords, nine years ago I took part in this debate, as did many others in your Lordships’ House. I was deeply moved then, as was the noble Lord, Lord Alli, by the cases and arguments put by the noble Baroness, Lady O’Cathain, which were repeated so eloquently today by the noble Baroness, Lady Deech.
I agreed absolutely that we need to address the problem of inheritance for people—they may be sisters or may not even be blood relatives—who none the less share a home for a long time and then face the problem of an inheritance tax which could push them into the shadows of residential care. I absolutely accept that that must be addressed. I hoped at the time we argued this, and still hope, that this should be addressed by the Treasury agreeing, very simply—it does not need legislation—that you can roll up inheritance tax on the first death to the death of the second person. As I understand it, that is all one needs to do. The state is not denied any money, but the sibling or carer who is left does not have the threat of losing their home held over them. That is the way to go. When it comes to extending or even considering this as part of an extension of civil partnerships, I obviously have no problem with this being part of a review, but I had two fundamental objections nine years ago and they remain for me today to consider this as possibly an extension of the civil partnership.
First, a civil partnership has a legal entry and a legal exit, which is equivalent to divorce. Take, for example, a mother and daughter who enter into a civil partnership, in good faith, partly to protect the home. The daughter may be in her forties or fifties; her mother dies, she inherits and is protected. If she is in a civil partnership and five years down the line meets a man whom she chooses to marry, she has to divorce her mother—her civil partner—to enter into a new marriage with a man. She may alternatively decide that when her mother has died and that civil partnership has ended she will form another civil partnership with her own grown-up son. Therefore the property cascades down the generations without ever touching the Treasury at any point.
This can be done through a revision of inheritance tax. It cannot in my view be done through a civil partnership which has to be divorced before you can enter another one or, indeed, before you enter a marriage. The notion that a daughter can divorce a mother in order to marry somebody else, or that a sister and brother can divorce each other because they each wish to marry someone else brings the notion of civil partnership, its ceremonies of entering and its divorce, into disrepute.
The second problem, which is why I was engaged fairly heavily the last time round, is that you cannot separate inheritance advantages from social security liability. If two people, whether they are a carer and the person cared for, a mother and a daughter, or a brother and a sister, enter a civil partnership in the hope of avoiding or postponing inheritance tax, they take on mutual responsibility for each other in social security. That means, for example, that if a frail elderly mother and a son enter a civil partnership to spare the son a big inheritance tax bill, he becomes wholly financially responsible for his mother, if he can afford it. For the first time ever, he will be means-tested for his mother’s support; his mother will have no independent rights to social security benefits because she will be his dependant. If he can afford to pay for her, the state does not need to. She loses her independence of social security income because the son, by virtue of the civil partnership, has taken on that responsibility.
I could enlarge on that, but noble Lords can see the consequences. If a sister and a brother enter into a civil partnership, then they become mutually financially responsible for each other in social security terms, including children and the like. The problem is that one cannot separate out the upside, in terms of inheritance law, for carers, or for a mother and a daughter or for sisters, without taking on, in all fairness, the downside of responsibility for social security.
I suggest to your Lordships that for every couple who gain through inheritance, there will be three or five poorer people, with no wealth to enjoy at inheritance and who have fairly modest incomes now, who will be losers. I do not think your Lordships would want that to happen. All I suggest is that noble Lords review and press to review the situation of inheritance tax and the ability to roll it up. In that way I think that we address the problem.
Lord Cormack
Does the noble Baroness not accept that we are not suggesting that where these other relationships exist a civil partnership is compulsory? Her whole argument is based on the assumption that it is compulsory.
Baroness Hollis of Heigham
My Lords, if there is to be a relationship recognised as an extension of the concept of civil partnerships for inheritance tax, it also produces a responsibility for mutual financial support called social security. The one goes with the other. The way around it is something that I think my Government should have explored, and that I hope the current coalition Government will explore; the noble Baroness, Lady Knight of Collingtree, was absolutely right about this. We should see a way of avoiding a survivor, particularly in the case of the two elderly sisters who went to the courts, having the inheritance abated on the first person and being rolled over to the second death. That seems to me to protect the position of the two sisters, which I think we were all deeply moved by, but would avoid the long-term problem of social security which would otherwise follow.
Baroness Deech
I think that the noble Lord and the noble Baroness, Lady Hollis, have misunderstood my point. Of course there would be no question of making anybody enter any sort of contract of union. I am sure they would sit down and work out whether it was worth doing because of inheritance tax, and then of course they would—and should—happily take on the duty of supporting each other. However, if they do not want to, and they want their benefits, then that is it; there is no question of dropping this on them without their consent. There would have to be some sort of formality.
Housing Benefit
Baroness Hollis of Heigham Excerpts(12 years, 9 months ago)
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Baroness Hollis of Heigham
My Lords, what advice would the Minister give to this chair of a housing association? We have a family consisting of a disabled couple who have two children and live in a house that has one double bedroom and two single bedrooms. They cannot move because there is no stock in rural Norfolk for them to move to. They cannot work because of their disability and caring responsibilities. They cannot afford the bills. They are applying for discretionary housing payments but that will run out by about September. At that point they will run into severe arrears. Would the Minister advise me as chair of that housing association to evict that family at that point and to send them into bed-and-breakfast accommodation at a higher cost to us all as well as to them?
Lord Freud
My Lords, the idea of providing discretionary housing payments is twofold. The first is to allow for the costs of making a change and a transition; and the other, in some cases, is to maintain the family in an appropriate home indefinitely. One of the most obvious examples of the latter is specially adapted homes where it does not make sense to move. So there should be a strategy of support for that couple regardless of whether it is in the short term or the longer term.
Queen’s Speech
Baroness Hollis of Heigham Excerpts(12 years, 9 months ago)
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Baroness Hollis of Heigham
My Lords, we have had an outstanding maiden speech. We have two more to come, and I am sure that they will enrich this debate and the House, for which we are grateful.
In the Queen’s Speech we were promised both a health and social care Bill and a new single state pension. Why does this new single state pension matter so much? It matters because private occupational pensions do not really work for those with few other assets, the low paid, the self-employed, part-time workers, those with caring responsibilities and, above all, women. Think about it. To get a useful occupational pension, you start contributing young. You and your employer contribute enough throughout your working life. You stay in full-time work for 40 years, you gain from tax relief, you can manage investment and disinvestment strategies and DC schemes, and you do not need to touch your pension savings because you can access other savings. Not one of those propositions fits most women or, indeed, many low-paid men. You could not devise a worse fit for women if you tried.
A woman’s earnings are interrupted by childcare from her late 20s and elder care from her 50s. Work is part-time, low-paid and unpensioned. There is little or no gain from tax relief and little or no ability to manage DC investment. There are little or no other savings, so if she faces divorce, debt or disability, she cannot access her own pension savings; she can access only the moneylender, at higher cost. None of it works for her. That is because pensions were built by men for men to smooth the income from work into retirement. Yet for most women, their working life needs more smoothing than the move into older age. Therefore, they will always need a decent state pension, which is why I welcome the new single state pension so much.
The new single state pension will do five key things. First, as it is not dependent on waged work, it can credit in women’s hugely valuable caring work, around which our society pivots and which occupational pensions can never support. It therefore strengthens the contributory principle on which a decent social security system rests.
Secondly, it will offer a more adequate platform for retirement. A couple—he on average wage, she in part-time work—might bring home, say, £30,000 a year. With a combined new state pension of £15,000, and perhaps his small pension of £5,000, so £20,000 in total, they will have an earnings replacement of two-thirds before you count in the savings from no work-related costs. That is adequate.
Thirdly, the previous Government significantly reduced pensioner poverty. However, while means-tested pension credit lifted significant numbers of elderly poor pensioners out of poverty, it had the perverse incentive of discouraging future pensioners from saving. The new state pension, because it is above the means-tested benefit level, will make it safe to save. Every penny the woman hairdresser or the shop assistant puts away in a NEST, she will gain in full.
Fourthly, people will be able to plan for their retirement, knowing what they can rely on from the state in their older age—a simple, predictable, risk-free and adequate foundation pension. It will be genuinely transforming for many women and low-paid people in the future.
Finally, there is much talk about increased life expectancy—one year more for every five—but, on a point to which I shall return, for most people those extra years will not be years of good health. However, a good state pension, money, will do much to help stave off disability. It will buy heating, better food, cleaning and taxis—all to be welcomed.
I will say a word or so about universal pensioner benefits. Do not touch bus passes, which address the issue of pensioner isolation. Do not means test because a third of pensioners do not claim means-tested benefits, and the whole point of the new single state pension is to get rid of means-testing. You could tax, but, particularly with winter fuel benefits, which are expensive, you would get in very little—I calculate that it would be about £100 million. Instead, given the new state pension in 2016, we could postpone winter fuel payments alongside TV licences for that generation and for future new pensioners until they reach 75. Age is quite a good proxy for need—older pensioners are poorer pensioners, such as elderly widows whose husbands have died and whose occupational pensions have died with them—and I calculate that within about five years we would save about £1 billion a year and upwards. It is only a thought, but it would be simple, universal, targeted, fair and affordable.
However, if you really wanted to save on the pensions bill while increasing fairness, you would seek to tackle tax relief. It costs nearly £40 billion a year, of which two-thirds goes to the wealthiest. It is a shadow welfare state costing almost as much as the basic state pension itself. Given tax relief and national insurance, which should be levied on those of us who work beyond state pension age; given that we have an upper earnings limit at all, which is not defensible at all, which makes national insurance regressive and whose abolition would bring in £11 billion; given equity release—more than £1 trillion is locked away in housing equity and only between £0.5 billion and £1 billion is released every year; we have plenty of resource both for adequate state pensions and for social care if we seek to address and distribute the resources that we already have.
I make one final point. We need to think differently about life after 65. Increased life expectancy is not, for the most part, increased healthy life expectancy. The extra years are largely years of poor health. Most of us can expect three stages of older age: a decade or so of healthy life, and the number of healthy years is not really increasing by much, except for the better off; a decade of some limiting disability, such as a lack of mobility, the inability to reach or difficulty in hearing, but with care needs sufficiently modest that, along with telecare, they can normally be met at home; and between two and five years of frail dependency, including dementia, during which substantial personal care is needed.
It is the second stage—a limiting disability—that in my view, from all the research that I have studied, is lengthening with increased longevity. Funding and supporting that stage is not actually expensive, especially given that half the growth in the number of older people is the result of increased longevity and half is from a bulge in the number of older people coming through from the baby boom. When that is played through in the next 50 years or so, we will have just about the best worker to pensioner ratio in Europe. When we hear all those siren calls to raise the state pension age in line with increased longevity, we should pause.
In Norwich, the difference in life expectancy between the poorest and richest ward in my city is 11 years. The gap in healthy life expectancy between those two wards is 15 years and widening. Eight in 10 better-off men but only three in 10 poorer-off men will survive to 80. Therefore, in all fairness, the state pension age should rise only with any rise in the years of healthy life expectancy, not with any overall increase in longevity, which is mostly disability-accompanied, otherwise the years of healthy retirement for half the population—the poorer part—as a proportion of their adult life will actually shrink: a profoundly unfair outcome for profoundly unfair lives. We can all do better than that.
Jobseekers (Back to Work Schemes) Bill
Baroness Hollis of Heigham Excerpts(12 years, 10 months ago)
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Baroness Hollis of Heigham
My Lords, I support my noble friend in his amendments. Timely and efficient appeals systems are always necessary and in these circumstances they are essential. The social security appeals system is under strain and that strain will be intensified as a result of what claimants will now be experiencing. What are those difficulties? The number of social security cases going to tribunals in general were 418,000 in 2010-11, 70% higher than just two years previously, while, as far as I can tell, this year’s statistics are up a further 14% or so, and appeals against sanctions as such are only a modest proportion of these.
Social security appeals represent half of all tribunal cases. The tribunals are receiving social security cases faster than they can clear them, so that although half of all cases take 14 weeks or less, one-quarter take between three and six months to be heard and 10% take between six months and a year, so only half of those cases meet the key performance indicator, the KPI, of 16 weeks laid down by the department. During that time—that extra long waiting period already experienced—claimants’ circumstances change, they lose oral evidence based on memory and above all they are left without any benefit, some of them for months, and suffer real hardship. Timeliness and efficiency, therefore, are key.
We need the Government to tell us what problems they will meet in unleashing the stockpile of sanctions cases into a system already under strain, with the inevitable appeals that will follow, and how they propose to resolve them. How many cases are currently outstanding? Do the Government have the capacity to increase sitting days beyond the 80,000 or so required at the moment to deal with the full backlog? How long does the Minister expect claimants to have to wait? How many, and what percentage, will be over the three-month KPI target?
The second issue is not about numbers but about verdicts and outcomes. Of those cases going to appeal, some 40% overall are won by the claimant. Former presidents’ reports on this are, frankly, an excoriating indictment of the DWP decision-making process and their findings over the years are confirmed by the recent November 2012 report analysing appeals. The main reason why appellants win is that they produce additional oral evidence not previously taken into account by DWP. However, the reports and the research have noted that tribunal judges were continually frustrated by the behaviour of decision-makers within DWP. In the latest statistics, about one-third of local decisions on sanctions were reconsidered by the decision-maker and, of those, half were in favour of the claimant. Of those not accepted by the decision-maker, just over one-third are going on to tribunal.
Why are those tribunal judges so continuously frustrated by decision-makers’ efforts within DWP? First, we are told by tribunal judges that decision-makers choose not to accept additional, usually oral, evidence without having any good reason for refusing it. That is because they have often failed properly to engage with the claimant. Something like 65% of all appeals come into this category. Secondly, there is little evidence that decision-makers reconsider cases at all. They were, the report said, reluctant to do so and did not bother to explore any discrepancies in evidence or to follow up requests for further information.
Thirdly, decision-makers did not weigh medical evidence at all appropriately, especially for mental health claimants, nor did they seek further information when dealing with a progressive condition. That applied to something like 15% of the appeals that went to tribunal. Most damning of all, they often made different decisions from the tribunal decision-makers on the basis of the same evidence presented to the tribunal, which meant that decision-makers got it wrong, according to law, in 30% of the cases lost by DWP. In other words, had the decision-makers within DWP done their job properly, these reports suggest that DWP would either not have had the appeal because the decision-maker would have rightly reversed the original decision, or at appeal the DWP would have won most of the appeals that it lost because the tribunals would have accepted that all the appropriate evidence had been properly assessed. That is a pretty searing judgment of the current system.
What are the implications for those caught by this Bill? The problem is clearly threefold. First, local offices are making flawed decisions, including on sanctions, and that is before we get on to the disgraceful area of targets. Secondly, decision-makers are not doing a proper job reviewing those local office decisions and are endorsing flawed decisions that they should have corrected. Thirdly, the tribunal service cannot keep up with the increased number of appeals coming its way. Of course, this will get far worse now that legal advice and support are withdrawn and, as a result and as we shall argue later, tribunal cases will take twice as long to process.
Will the Minister reduce the pressure on tribunals and better support claimants by requiring decision-makers to do a more conscientious review of the original decisions? It is clear that at the moment too many of them are not doing a professional job—bluntly, they need to brought face to face with the evidence. Are decision-makers informed of the tribunal’s findings and is their performance reviewed when their decisions are overturned by the tribunal? Could that perhaps be a KPI? What guidance and additional training will be made available to decision-makers to improve their performance? If the Minister is going to review any targets, could we please have a new performance indicator, a really useful target that reduces the number of successful appeals by claimants from the current 40% or so down to, say, 20% or even 15%? That would really transform decision-makers’ behaviour.
Given the trivial basis for sanctioning claimants uncovered by the Guardian, many of whom we can expect to appeal, thus increasing the backlog before eventually being overturned at appeal, as many of them will be, will the Minister ensure that cases going to appeal are pre-reviewed and re-reviewed by decision-makers to improve their own poor-quality decision-making? Will he also ensure that the number of tribunal sitting days is appropriately increased to meet the target of within 16 weeks, so that they are timely, and that—I am trespassing into a following amendment—sufficient advice is given to claimants, as my noble friend Lord Bach will argue, to reduce the number of unsuccessful appeals, given the delays? I hope that the Minister will be able to answer these questions and those of my noble friend tonight and in the process perhaps allay our very real concern for these claimants who are going to be caught up in an appeal system that is increasingly flawed and failing.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)
My Lords, the purpose of these amendments is to ensure that the reconsiderations and appeals arising from decisions relating to sanctions that are dealt with by the Bill are considered in a timely and efficient manner, and that appeals take into consideration the delay between the failure to participate and the issuing of the sanction.
I am happy to give a commitment to the House that DWP will process the stockpiled cases, and any reconsiderations and appeals that follow, in a timely manner. It is not in the department’s interest to procrastinate on these cases any longer than necessary. I also note that the department is already required by Article 6 of the ECHR to deal with social security disputes in a reasonable time, while the First-tier and Upper Tribunals are also bound to deal with appeals in a fair and efficient manner. When the Bill receives Royal Assent, I assure noble Lords that processing the stockpiled cases, including any appeals and reconsiderations, will be given a high priority. Purely from a business perspective, DWP will want to unwind these cases and any follow-up activity as quickly as possible so that it can utilise its resource in dealing with more current claims.
The associated amendment seeks to ensure that when the First-tier Tribunals and the Upper Tribunals are determining an appeal against a sanction decision issued in reliance on the provisions in the Bill, they have regard to the circumstances around the Reilly/Wilson case, particularly any delay resulting from the case. I understand, given the noble Lord’s statement at Second Reading, that he is concerned that, because there may have been longer than usual between the failure to participate and the issuing of a sanction, the claimant will be unable either to remember or to provide evidence of any good cause they had for the failure.
I will spend a moment describing the process that happens between a claimant failing to participate and the issuing of a sanction. When a claimant gets referred to a DWP decision-maker for a sanction decision, a letter is sent asking them to provide evidence of good cause. The letter says:
“Will you please contact me before”—
and then a date is inserted—
“to explain why you did not undertake this activity. You should note that unless you provide a good reason for not undertaking this activity, your benefit may be affected”.
So the stockpiled cases would, at the time of the failure, already have been asked once to provide good cause. The fact that we did not deal with these cases immediately will not have prevented these claimants from providing evidence of good cause at the time of the failure. The decision-makers will have all this evidence on the stockpiled cases already, so the risk that they have been unfairly treated is significantly minimised.
I know that not all claimants will have provided their evidence of good cause the first time they were asked for it, although this is of course entirely their fault. However, I reassure noble Lords that in these cases, where a claimant is attempting to argue that they had a good reason for a failure that occurred many months ago, decision-makers and First-tier Tribunals will make an objective decision based on the evidence before them. They would of course take into consideration any claimant’s argument that they had good cause, but that they cannot provide evidence because of the length of time since the failure. It would be up to those hearing the appeals to judge on a case-by-case basis whether they thought this argument was strong enough.
I also note that this amendment only seeks to ensure that the appeal, and neither the decision to issue the sanction nor the reconsideration, takes into account any time delay caused by the Reilly/Wilson case. I assume that this was not the intention of the noble Lord, Lord McKenzie. There is this oversight, and claimants in the stockpile would at the time have been asked for evidence of good cause. The tribunal is also already bound to have regard to all relevant matters.
Picking up the issues raised by the noble Lord and the noble Baroness on national insurance credits, prior to the changes to the jobseeker’s allowance sanctions regime from 22 October last year, national insurance credits were paid during the period of the sanction. National insurance credits are not paid when the benefit is sanctioned on or after 22 October. The Bill does not change these arrangements. The payment or not of national insurance credits with respect to stockpiled sanction decisions will therefore depend—
Baroness Hollis of Heigham
I support the amendment of my noble friend. I have to declare a sort of interest as a former Minister responsible in the DWP for the tribunal services before Leggatt centralised them. As a result, I would visit tribunals and, five minutes into the hearing, I could tell whether the claimant had or had not received legal advice and support or welfare advice and support before entering the appeal. Those who had presented a coherent account with the appropriate accompanying papers and evidence, were prepared for the questions asked of them. It kept the process simple and straightforward, and the cases that I saw took on average about 40 minutes to complete. In each case, the decision, usually up to half the time in favour of the claimant, was the right one.
Then there was the other sort of case that came to tribunal, people who came with their sheaf of papers in a carrier bag, which they shuffled through without any advice, unaware of what it was that the tribunal needed to know and what would count as relevant evidence. I recall one man, Indian or Pakistani, who was there with his wife; his eyes never left the floor, and he sat hunched over as he tried to explain in poor English and a low, faltering voice, why he was appealing against a refusal of DLA—and he could not. The superb chair, who we now call a judge, spent nearly two hours trying compassionately to coax his story and evidence out of him in some sort of order. It took more than twice as long as the previous case, and his appeal was upheld.
What lessons may we draw from the situation in which there is no prior legal help or support for advice? Social security decision-makers, as we argued on the previous amendment, frequently fail to review decisions properly. Unless the claimant is savvy enough to put his case in ways that fit guidance on reconsideration, we end up with an unnecessary tribunal case, and the tribunals handling such cases clear, as a result, two or three cases a day instead of five or six. I plead with the Minister to learn from this. I do not know whether he has sat in on any social security tribunals, but he would quickly see which claimants had had prior advice and which had not. Remove the advice and the need does not go away; it is merely displaced to the very much more expensive and time-consuming stage of the tribunal itself. Instead of advice being given in advance, the whole untangling of that mess has to be done by the tribunal judge in person. That seems to me key. The need does not go away; all you are doing is transferring it to the most expensive and laborious way of addressing it.
Legal advice, which we are told we cannot afford, is not a luxury; in my view, it is essential because social security is complex and most claimants, by definition, are probably poorly educated, not especially articulate, confused about what they are due and need help at the early stages. They are aggrieved. However, as my noble friend Lord Bach said, early advice may discourage people from pursuing unfunded and unfounded cases. Legal advice also helps ensure greater consistency and a common approach across regions. We are getting a lot of research evidence suggesting the unevenness of responses from decision-makers and tribunals trying their best to produce the consistency that local offices are not.
The Minister knows that we are seriously worried about what will happen when existing claimants are brought on to UC, which I very much want to work. I fear that the tribunal system will be completely overwhelmed unless there is legal aid and welfare advice available at the preliminary stage to screen out weak cases and to put into good order appropriate cases for the tribunal; otherwise, I believe that the system will buckle.
We are therefore deeply worried about the situation of claimants under the Bill who will not know what their rights are and whether the proposed sanction is valid. In some cases, they may have been stalled for many months. They do not have fresh evidence to bring to bear and can no longer rely on their memory to give a coherent account of what happened when. Did they have good cause? At the preliminary stage, legal or welfare rights advisers can perhaps help them find out, track hospital or school records, organise paperwork and explain to the claimant what will happen, why he has lost his benefit and whether the case against him is soundly based. If that welfare rights officer or the legal advice is not there to do that, the tribunal judge will have to, as I have seen with my own eyes. Can that individual stop the sanction? Is it possible for him to comply? Jobcentre staff cannot or will not now give that advice, especially given the evidence about targets. Claimants need the supportive, friendly, neutral, professional, cheap advice from outside the system. However, of course all this hinges on whether the department wants people to get the right benefits and the right outcome. Does it?
Lord Howarth of Newport
My Lords, is it not the case that every Government of the United Kingdom since 1948 have been committed to the principles and values articulated in the Universal Declaration of Human Rights? Is it not also the case that Article 7 declares that all are equal before the law and are entitled without any discrimination to equal protection of the law? If the Government deny legal aid in these cases, will they not repudiate that historic and fundamental commitment?
Lord Freud
Perhaps I may make absolutely clear the point about the numbers. There was a lot of comment from noble Lords opposite that the system would be overwhelmed by the numbers because people did not have legal advice and the system could not therefore cope. The point I am making is that that argument does not stand in the light of the rather small number of cases—between 1,500 and 2,000—that might come towards the First-tier Tribunal as a result of the Bill.
Baroness Hollis of Heigham
If I may intervene, approximately 500,000 sanctions were issued last year. Something like 3,500 or 4,000 of those cases went to appeal. That was last year, before this additional provision hits them. The Minister may wish to reconsider his statistics.
Lord Bach
My Lords, perhaps I may go back for a moment to the hiatus caused by the Court of Appeal decision. It means that those who stood to have the protection of the law as it stood at the time that they were sanctioned or due to be sanctioned will, if the Minister is right, no longer have that protection, merely because of the passage of time and because something has intervened that is absolutely no fault of theirs, but is, I am afraid, the fault of the Government. That seems to be against any British sense of fair play. I beg to test the opinion of the House.
Lord Freud
My Lords, I will address Amendments 4, 5, 5A and 6 together. The purpose of these amendments is to place in the Bill detailed requirements for the independent report set out in Clause 2.
I should be clear that Clause 2 provides for an independent review of the operation of provisions relating to the imposition of sanctions which would, without this legislation, be unlawful. The amendments could be seen to imply a much wider review; it is not a full review of the operation of sanctions, although clearly there could be wider relevance. At least one of the things covered in the amendment is not within the scope of the Bill: paragraph (d) asks about the number of penalties imposed upon claimants in receipt of employment and support allowance. I can answer that today, as the Bill is only concerned with JSA claimants.
The Government are happy to consider a wide range of areas for the review, but it would be unhelpful to lock down the terms of that review at this stage. Despite my earlier comments, the amendments list a number of areas the review could usefully consider. I am happy to confirm what I said on Thursday, and give a commitment that we will discuss further with the Opposition the scope of the review. Within that process, we can look at the point raised by the noble Baroness, Lady Lister, on provision for outsiders.
Amendment 5A would ensure that the independent reviewer makes an assessment of the extent to which senior managers in Jobcentre Plus have used targets in the operation of sanctions. This amendment is completely unnecessary. There are no targets for sanction referrals. The Government have made a point of removing the vast majority of targets within Jobcentre Plus. It is regrettable that loose drafting of an internal e-mail suggested otherwise. If noble Lords look at sanctions, there is no clear trend in the proportion of the caseload who receives them. Prior to 2007, the rate was running at around 4%; since then it has fluctuated between 3% and 5%. There is not the clear trend in the growth of sanctions which some people have been claiming.
Baroness Hollis of Heigham
My Lords, I do not doubt the Minister’s honesty and integrity in his statements about targets at all. However, the staff clearly do not believe him. It is clear from the evidence that we have seen—the leaked e-mails and all sorts of other examples coming to Members of Parliament and so on—that the staff in local offices believe, because they are told by their managers, that they have to increase the number of sanctions. In the e-mail, the manager of the particular jobcentre was criticised and told that she would be subject to first-stage disciplinary hearings because that office was something like 93rd out of 101 in sanction production; they should have been producing something like 25 a week and were only producing four or six a week. Therefore: “Guys, we should raise our game”.
The e-mail was not loosely drafted. It was very precisely drafted; we have all seen copies of it. That e-mail, from someone senior in the office to their staff, made it very clear that if they did not increase a number of sanctions, they, too, would be involved in a disciplinary process. That is believed by those staff and by staff across the country. I do not doubt the Minister’s word, or that he does not intend that to be the case. What is he going to do, therefore, to ensure that local offices no longer behave in this way?
Lord Freud
My Lords, let me make very clear the difference between having targets, having business or management information, and doing something with that information. Clearly, you collect these data not just to answer parliamentary questions but to run the business. It is used to look at where there are outliers and peculiarities, and what the norms are. When a particular jobcentre may be well outside the norm on either side, you might want to ask it why that was the case. Was it justifiable, and what were the dynamics of that? In some cases you are clearly looking at particular parts of the operation that are not operating in line with the norms. That is not having a target culture. A target culture—as the noble Lords opposite will know, because they were running one in many parts of the public services—is where you incentivise and drive performance based on particular targets. We do not do that. We do not have targets. We do, however, have management information and, as I say, we need to understand why outliers exist.
Baroness Hollis of Heigham
My Lords, will the Minister explain why this senior staff member—the manager of the office—told the staff underneath her that unless they increased the number of sanctions she would be subject to the first stage of a disciplinary procedure, and that that, in turn, would mean that she would have to discipline them? How does he explain that?
Lord Freud
My Lords, I am not going to pick up a particular case because I do not have the detail on it. It would not be appropriate for me to hazard a guess on what was behind a particular e-mail or a particular concern.
Lord Touhig
My Lords, I hear what the Minister has said, and he is held in high regard across the House. In view of what my noble friend Lady Hollis has said, will he therefore initiate an investigation into how this memo came about? Will he come back to the House to explain what action the Government are taking on this? Somebody is clearly acting against government policy, and it should be stopped.
Baroness Hollis of Heigham
Will the Minister also, therefore, ensure that all DWP local offices receive the same information—that this is to be deplored?
Lord Freud
My Lords, I must repeat what I have just said. Clearly, we have internal management information. It is vital that we keep it, and we publish a lot of it. We need to understand why some areas, some jobcentres, have higher rates than others and why some have lower rates. Some may have very good reasons for having lower or higher rates, while others may not. We therefore need this information to correct the anomalies, and that is normal business practice. It may be that in particular cases a jobcentre manager is told, “You are running very high or very low figures, and you cannot justify the reason for that, so you need to get more into line”. It may happen. I have not got the particular details.
Baroness Hollis of Heigham
In that case, what is the difference between coming more into line and targets?
Lord Freud
The noble Lords opposite know exactly how targets operate because they operated a target regime. Targets are when people are incentivised to perform to particular figures.
Baroness Hollis of Heigham
What if they are incentivised by the threat of being punished?
Lord Freud
They are usually incentivised to reach targets, and we do not run a target regime. The no-targets message has gone out repeatedly.
Lord Freud
The difference is that where someone is not performing in line with the rest of the business for no good reason—in other words, where there is nothing different in the underlying constituency of the business—they are not operating the business in line with the standards that we have. That is entirely different from having targets, because it is understood that no figures are going out with instructions to achieve something. The message that there are no targets goes out repeatedly to jobcentre managers; there has been a reminder from the Work Services Directorate that there are no targets; and we will investigate if people have misunderstood that approach.
Baroness Stowell of Beeston
It is Committee, but the Companion guides us by stating that, during any stages:
“Lengthy or frequent interventions should not be made, even with the consent of the member speaking”.
My noble friend is very tolerant and I know that he will keep responding to interventions. However, the hour is late and there have been several interventions.
Baroness Hollis of Heigham
My Lords, I should like to support my noble friend by saying that I am mortified about the additional numbers on the other side as the result of our strenuous debate. I thought that we might have persuaded a few more to abstain.
I hope that the Minister can agree to this amendment. There are three broad reasons why we need new guidance and clarity on the sanctions regime: the issue of targets/norms, good cause and compliance. The Joseph Rowntree research that came out in December 2010 shows that claimants have a low level of awareness of sanctions and that the more disadvantaged they are, the higher the risk of sanctions and the less knowledge they have about them. This applies to young claimants, those with a disability, those with a poor education, those with large families and those from an ethnic minority. The research shows that they are not out to flout the system but that they have poor information or non-intentional behaviour such as forgetfulness. In that context, I want us to support my noble friend’s amendment.
I turn first to the issue of targets. The Minister was at some pains to explain to us earlier that “targets” is a relevant word only where you are rewarding behaviour, but when you are punishing it, that is a “norm”. We know that if you exceed, you get a target, and that if you underachieve, that is a norm. It is clear that targets or norms, whatever we want to call them, are the enemy of mitigation. Using them to allow the Secretary of State to claim clean hands while the staff do the dirty work under pressure from above is completely unacceptable. We need clear evidence, guidance and clarity from the Minister on the sanctions regime to ensure that targets do not stand in the way of mitigation. If people are allowed to mitigate and sanctions numbers therefore reduce, so will the targets, and staff will obviously have an incentive to fail to ensure that claimants follow good procedure and appropriate behaviour because they themselves face disciplinary action. That is a moral, or immoral, position, into which they should not be put.
Secondly, we need this guidance to ensure that claimants are aware that they may be able to mitigate sanctions by establishing good cause. My noble friend gave the example of the lone parent unable to attend an interview. Every parent in this House has had a child who has been sick and they may have missed an interview as a result. There is no doctor’s evidence because, by the next day, the child is well. Certainly that happened to me on numerous occasions. However, in this new, suspicious, look-for-any-benefit-cutting-excuse, hunt-them-down culture, of course we all now assume that any lone parent will keep her child at home and away from school simply to avoid an inconvenient interview. She says that the child was poorly, but why believe her? As she can provide no evidence, the office has got her and another tick is put on the whiteboard.
The third reason for needing guidance on mitigation is that, as the courts have indicated, claimants need to know and have a right to know how they may end their sanction by complying with jobcentre requirements. This issue marks the crucial line as to whether we are using sanctions to reduce the benefit bill or whether we are using them to change behaviour. If it is the first, giving little information or hope for people to find their way back into the system, then the Minister risks creating a growing underclass without income, without much hope and without any help. But people, as Carlyle pointed out 150 years ago, will not starve quietly. Some may have families to help them, and they will be the relatively lucky ones. Some may beg, while others will cross the line into thieving, drug selling and semi-criminal behaviour. This is what the Rowntree trust warns us of. They will come to regard social security laws, in so far as they understand them, and increasingly other laws, as not applicable to them. We will all then pay a high price. If it is the second—that instead of simply trying to cut the benefit bill on any hook we can find, we want people to change their behaviour and sanctions are part of the tough love regime, as I believe they should be—then we absolutely must encourage people to end sanctions by complying with what they are expected to do. When they do so, we should rejoice, even though it means fewer ticks on the whiteboard of targets to be met.
Research evidence shows up that up to two-thirds of those sanctioned do not know the whys or wherefores, or what they can do about it. The Minister, whose integrity we totally respect, accepted at Second Reading that that was indeed the case and that therefore the issue of sanctions had to be revisited. If the issue has to be revisited, he should now accept my noble friend’s amendment, because it amplifies what he himself has already agreed. Mitigation means ending the culture of targets and, incidentally, protecting any whistleblowers in the process. It means ensuring that people have the help that they need to claim good cause where that exists and it ensures mitigation so that claimants will know how they can end the sanction by conforming to benefit requirements. I hope that all in this Committee agree on these three goals. In which case, I hope that the Minister will accept the amendment.
Lord Freud
My Lords, this amendment, which would require the Secretary of State to issue guidance on the way in which claimants can mitigate any penalty imposed under the ESE or MWA regulations after the Act comes into force, is unnecessary, as this information is provided to claimants as a matter of standard practice. When a claimant is issued with a benefit sanction, they are as a matter of course sent a letter explaining the decision made and what effect it will have. The letter clearly tells claimants that if they want to appeal the decision, they should fill in leaflet GL24, If you think our Decision is Wrong, and that claimants can,
“get this leaflet from your Jobcentre or Social Security Office”.
Attached to the sanctions letter are two leaflets: leaflet 1NF1, on appealing against a decision and leaflet JSA9, the hardship leaflet). I have both of these leaflets with me today.
The leaflet on appealing against a decision explains in plain English who the claimant should contact if they want to know more about the decision or, if they think the decision was wrong, how to appeal it and what support they may get in formulating that appeal. The hardship leaflet explains what financial support is available, the eligibility criteria and how to apply for hardship, and provides the form they must fill in to claim hardship. The whole process is done as a matter of course and, indeed, is on the record and available for anyone to see how those leaflets work.
I turn to the point raised by the noble Baroness, Lady Sherlock, on recompliance. If a claimant has been issued with a 26-week sanction but has complied in the intervening period, they will be served with a four-week sanction. Recompliance is not particular to any scheme and can include participation in any other scheme. Of course, the sanctions regime has changed, so if the failure to participate was before 22 October last year, the old regime, which includes the re-engagement, applies. However, if the failure to participate is after 22 October, the current sanctions regime, which has no engagement and which builds up, will apply. That goes on the time of the failure to participate.
The noble Baroness was concerned about the time between the failure and the sanction being imposed on the stockpiled cases. I am sorry that I have not yet found a better word than stockpiled but it is for cases not people. As I said on an earlier amendment, the process of finding that information takes place immediately on the failure. They receive a letter and need to provide good cause at that point. Clearly, where there is a problem and there needs to be amplification, and there is a problem of information or evidence, the decision-maker will have to take that into account in the normal way, given that there is a gap and it is a justifiable lacuna.
As a matter of course, the cases that we have stockpiled will get issued with a sanction and receive the standard letter, and those accompanying leaflets that I outlined. This amendment is therefore superfluous and I ask the noble Baroness to withdraw it.