Select Committee on Social Security Minutes of Evidence

Examination of Witnesses (Questions 120 - 139)



  120. So it is not only between districts, within the same district you could have two cases exactly the same, coming up with entirely different results, depending on when you made the application?
  (Sir Richard Tilt) At different times of the year, yes.

Mr King

  121. But if they overspend, does that die at the end of the year and they start afresh each year? I am just a bit concerned.
  (Sir Richard Tilt) Yes, they start afresh, and there is some reallocation within year, and there is, again, some recycling of money that is coming back in repayment on the loan scheme.

Mr Dismore

  122. So, following up on that, is there any evidence that people are being told, if they turn up in February, "Go away and come back in April"?
  (Ms Adey) No.
  (Sir Richard Tilt) I have seen no evidence of that.

  123. You would not know?
  (Sir Richard Tilt) No, we would not know that.

  124. But, equally, people would be entitled to reapply, a couple of months later, for the same thing?
  (Ms Adey) They can reapply to the Fund, but there is a Secretary of State's direction which stops them reapplying within six months for the same need, in the same circumstances; if their circumstances have changed, they can reapply and get through.

  125. So, if people do not know about not just the postcode lottery but also the calendar lottery, effectively, they can be screwing themselves up by making a claim at the end of the financial year, which could quite easily succeed if they made it only a few days later?
  (Sir Richard Tilt) Yes. I do not think it is quite as stark as you are presenting it, but that feature is there, that there are changes through the year, at different times of the year, and there are inconsistencies between different parts of the country, and which is unsatisfactory from our point of view, but I would not actually describe it as starkly as you have done.

Ms Buck

  126. Just back to the areas where they have reached their ceiling, do you get a recurrence of that geographical pattern; you talked about it not having the same characteristics, but do the same districts repeatedly spend up to their ceiling early?
  (Ms Adey) There is some evidence of that, yes.


  127. Has any of this ever been challenged at law, the ministerial discretion, in the allocations?
  (Sir Richard Tilt) Have you got any cases?
  (Ms Adey) Not on this particular issue.

  128. I mean, by means of judicial review?
  (Ms Adey) In the early years, there was a judicial review which challenged the cash limit and how that was managed, and the primary legislation changed as a result of that judgement, but there has not been a challenge directly on the Secretary of State's right to dish out the budgets.

  129. Pauline, you might give us the reference to that case, the rubric, at some time?
  (Ms Adey) Yes.[19]

Mr Dismore

  130. Just following on from the Chairman's question, presumably, there is no appeal beyond you, other than a judicial review. Are there any judicial review cases taken, are there statistics on judicial review involving you?
  (Sir Richard Tilt) Yes, we have got them here.
  (Ms Greenshields) We have had applications for leave granted on about 53 cases, and 23 cases actually went to full hearing, and I think the results were that six went in the applicants' favour and 17 were upheld.
  (Sir Richard Tilt) That is in the last 12 years, or so, yes.
  (Ms Greenshields) Yes, but the judicial review activity has—

  131. So it is not a recent occurrence?
  (Ms Greenshields) No; it works out roughly at about one in every 11,000 decisions that we make at the IRS.

Mr Thomas

  132. Can I ask you about crisis loans. You have said, in your paper, that there are certain types of applications for crisis loans which are currently being refused under the new formula which would have been allowed under the old system. Can you give us some examples of the sorts of unmet need under the present system, please?
  (Ms Greenshields) I think, actually, the paper was referring to needs that might have been met under the old Budgeting Loans scheme, just for example, cookers, beds, that sort of thing, because the Budgeting Loans decisions are now taken on a formulaic basis and urgency of the need is not considered, and those types of needs may, in some cases, not be met, depending on whether the applicant has a debt already.

  133. So you would have to go for a crisis loan then?
  (Ms Greenshields) Yes, and the conditions for a crisis loan are quite strict, they are about helping in an emergency, or as a consequence of disaster, but only where a loan would prevent serious risk or serious damage to health or safety. So there is just a little bit of a gap in the provision, in terms of the urgency.

  134. So is a refusal of an application for a Budgeting Loan a factor to be taken in your favour when determining whether you should get a crisis loan?
  (Ms Greenshields) The direction that deals with crisis loans actually was amended at the time of the changes to the scheme, from April 1999, saying that refusal of a Budgeting Loan will form part of the considerative process. But this is one of the problems that we have had with that particular amendment, in that it does not actually seem to make any difference to the cases that would have qualified for a crisis loan under the old scheme, it does not seem to allow any additional people to qualify.
  (Sir Richard Tilt) I think that was the intention, the way it is drafted does not seem to lead decision-makers in that way, really, but I think that was the intention.

  135. Crisis loans really are the last chance saloon, are they not; what is your understanding of the rate of refusal, in relation to crisis loans?
  (Sir Richard Tilt) We have got some figures somewhere, have we not?
  (Ms Greenshields) I do not think I have actually got them to hand.
  (Sir Richard Tilt) Can we see if we can sort those out?
  (Ms Greenshields) Yes.


  136. If these are complicated tables, just leave them with us?
  (Sir Richard Tilt) Yes. The figures are all set out in the latest Annual Report by the Secretary of State for Social Security on the Social Fund.[20]

Mr Thomas

  137. Is it a high rate?
  (Ms Greenshields) The 1999-2000 year, there were 1.2 million crisis loan applications, and 336,000 refused; so we are talking about a quarter.

  138. We can deduce from that it is quite a big failure rate, is it not?
  (Sir Richard Tilt) Yes.

  139. Can I ask you another question, on the repayment rate. My understanding is that that is not an issue which can be the subject of a review; do you think it should be?
  (Sir Richard Tilt) Yes, I think I do. I think it does concern us that the rate of repayment, if it is set and accepted at 15 per cent, is a large piece out of a subsistence level of income, and it is not something we are able to deal with at all. It could either be something that did become an issue for us, or some greater flexibility is required, I think, at the Benefits Agency in handling it. I think it is one of those things that ought to be discussable and reviewable and changeable, as people's circumstances change.

19   See Ev. p40. Back

20   1999-2000 Back

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