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Compensation Payments

5. Mr. Dafydd Wigley (Caernarfon): How much has been clawed back from social security benefit previously paid in each of the last three years after compensation payments have been made to social security recipients. [145962]

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The Parliamentary Under-Secretary of State for Social Security (Mr. Hugh Bayley): The compensation recovery scheme recovers money paid to people who have received benefit because of an accident, injury or illness once they receive a compensation payment from the party responsible for causing that injury or illness. The money is not recovered direct from the benefit recipient. The scheme provides protection to the taxpayer, who would otherwise subsidise the negligence of those responsible for injuries or illnesses, whether they are employers, car drivers or other people. Over the past three financial years, the compensation recovery unit has recovered a total of £570 million.

Mr. Wigley: Is the Minister aware of the case of an ex-miner from Pontypridd--now sadly deceased--against whom a certificate for compensation recovery for £21,700 was issued in November 1999? On appeal, the claim was reduced to £8,450, and, after several more appeals, it was reduced to £6.38. In view of the unnecessary delay, uncertainty and worry that such cases cause ex-miners and their widows, and the fact that, by now, a large proportion of clawbacks are for less than £10, would not claimants' anguish and the bureaucratic costs to the taxpayer be reduced if compensation clawbacks against coal miners were ended?

Mr. Bayley: Several such cases have been drawn to my attention by my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands). Higher figures were initially sought by the compensation recovery unit because the date of the injury had not been established at the time. The compensation recovery scheme provides for the Department of Social Security to reclaim benefits for five years from the date of injury. As a result of the difficulties in the cases that my hon. Friend drew to my attention, we have introduced some changes, about which I notified the House on Friday, in answer to a parliamentary question that he tabled. Those changes will speed up the recovery process and avoid the difficulty of a higher initial claim being made, because we shall seek to establish the date at which the injury occurred before we issue a certificate for recovery.

Mr. Ted Rowlands (Merthyr Tydfil and Rhymney): I thank my hon. Friend and the Secretary of State for the considerate way in which they have paid attention to the compensation recovery cases that my hon. Friends and I have brought over the past few weeks and months. May I tell him that his Department seriously underestimates the huge administrative burden, cost and complexity involved in dealing with such claims? There are now more than 130,000 claims, and 600 new ones were received in the first couple of weeks of this year. Given the complexity and the disproportionate cost of claiming, would not the best way to simplify the process be to exempt such cases?

Mr. Bayley: I thank my hon. Friend for his work and for the meetings on the matter that he has had with me and the Secretary of State. I feel confident that the changes that we have announced will greatly reduce red tape and speed up the process. Matters of compensation take time to resolve between those acting on behalf of the employer--the Coal Board, now represented by the Department of Trade and Industry--and the solicitors

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acting on behalf of the person seeking compensation. Under the arrangements for the compensation recovery unit that involve my Department, we have just 28 days in which to seek recovery, and if we do not issue a certificate within that time, we lose the right to seek recovery. Progress is being made, and I am grateful to my hon. Friend for that.

We do not believe that it would be right to exempt miners from the compensation recovery scheme. If we were to do so, it would be unfair to the others who seek recovery, such as the rail workers in my constituency who have died from asbestos-related diseases, or nurses who seek compensation because they have put out their backs by lifting patients. It would not be right to apply different rules to different classes of people.

Ms Rosie Winterton (Doncaster, Central): Will my hon. Friend consider the compensation recovery scheme that may apply to the relatives of people who have died of new variant CJD? The relatives may be eligible for compensation. The compensation has been widely welcomed, but if it is given with the one hand and taken away with the other, there will be resentment.

Mr. Bayley: I endorse the aims of the proposed scheme that the Department of Health is negotiating to compensate the victims of new variant CJD and their families. I assure my hon. Friend that officials from my Department are working closely with those from the Department of Health to ensure that the proposed new scheme fits with the current compensation scheme.

Care Home Charges

6. Mr. Paul Burstow (Sutton and Cheam): What representations he has received on uprating income support capital limits in line with the Department of Health limits for care home charges. [145963]

The Secretary of State for Social Security (Mr. Alistair Darling): We received a letter and representations on this subject from Mr. Gordon Lishman, the Director-General of the National Council on Ageing, in November 2000.

Mr. Burstow: Does the Secretary of State understand that the fact that the care and benefit systems are out of sync in regard to capital limits causes confusion for many care home residents and extra costs as a result of the transition from a system that is sustained by local authority contributions to care to a system that is partly funded through income support? That does not put an extra penny piece in the pockets of those in care homes. Will the Secretary of State undertake to discuss the matter again with his colleagues at the Department of Health to see whether the confusion can be removed and the two systems can be made to work better together?

Mr. Darling: The hon. Gentleman will be aware that part of the problem in the social security system is that there are far too many regimes for different benefits. Individuals can find themselves applying for several benefits and discover that the rules are different. We are trying to rationalise and simplify the system.

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All new residential accommodation cases will be transferred to local authorities from next year, so the problem will not arise, because there will be only one regime. That will leave us with the problems faced by people who went into residential care between 1993 and now. I am considering those problems, because I want, as far as possible, to try to simplify the regimes for capital allowances.

The Government want to encourage people to save. We are already increasing--and will ultimately abolish--the capital limits for pensioners under the pension credit. However, I want to ensure that whatever we do is consistent with a social security system that says to people of working age that any means that they may have should be taken into account; otherwise the whole process will become extremely expensive. However, I am considering the particular case to which the hon. Gentleman referred as part of a general review of capital limits in the social security system.

Mr. David Willetts (Havant): With regard to capital limits and income support, can the Secretary of State explain why the savings of disabled people on income support should be treated less favourably than the savings of pensioners on income support?

Mr. Darling: The hon. Gentleman will be aware that the Government decided to increase the capital limits next year and to abolish them for pensioners from 2003. He is also aware that capital limits are none the less imposed on other people throughout the social security system. As I told the hon. Member for Sutton and Cheam (Mr. Burstow), the Government are considering all the capital limits. However, the hon. Member for Havant (Mr. Willetts) will be well aware that raising capital limits across the board could be very expensive, even for the Conservative party, which is making spending commitments as though there were no tomorrow.

Mr. Willetts: I invite the Secretary of State to confirm as a matter of record that, within the income support system, the rules for the savings of pensioners and the rules for the savings of disabled people have hitherto been the same. Will he confirm that, as from April 2001, he will have one rule for pensioners and will treat disabled people as second-class citizens?

Mr. Darling: The hon. Gentleman will be well aware that the capital limits have for some time been different for different categories of people. The Government decided to increase and then abolish the capital limits for pensioners. The logic of the hon. Gentleman's remarks is that we should reimpose the capital limits for pensioners. If he is suggesting that he would lift the capital limits for disabled people and, perhaps, other groups, let him say so. At the same time, let him tell us how he would propose to pay for that. So far, he has not come up with a single credible proposal for reallocating social security spending or meeting any of the commitments that either he or his colleagues have made.

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