Mr.
Ruffley: My hon. Friend is there. The Minister is
saying—we are all saying it—that existing claimants will
only receive the support in the roll-out process before 2008, when ESA
kicks off, and after ESAis introduced “as resources
allow”. If I have misunderstood the meaning of “as
resources allow”, no doubt the Minister will put me right when
he replies. It seems that priority will be given to those closest to
the labour market. There is nothing wrong with that; they have to be
given support to get back to work. The Minister
said: “As a
priority, we will focus on those who are newest to incapacity benefit
or employment support allowance”.—[Official
Report, 10 July 2006; Vol. 448, c. 1093.]
The Green Paper says that the roll out of
pathways to existing claimants will happen only “as resources
allow”. That is not the same regime as that for new entrants
coming on to incapacity benefit in the roll-out period, or new
claimants for ESA. If we are wrong about that, I should be grateful if
the Minister could point to where he has changed his view about the
statement “as resources allow”. I want a constructive
debate because the point about existing claimants was not invented by
Her Majesty’s Opposition. Nor was it an hallucination on the
part of experienced private and voluntary sector providers. It is fact.
If there were a new policy that the Government have announced about
existing claimants that none of us has heard about, we should be
grateful to be put
right. My final
question relates to the pathways to work roll-out, which is essential
to the proper functioning of the ESA contracting regime under the
clause. The contracting regime for ESA will be the same as that for the
roll-out to pathways. The Minister said in his letter of 4 July to
Members of Parliament that the phase that will begin in October 2007,
the start of the roll-out of the pathways service to the remaining 60
per cent. of new IB claimants and repeat IB customers, will
be “mainly via private
and voluntary sector
partners”. That will roll
on until April 2008. I
do not wish to be known or thought of as a politician who likes dancing
on the head of a pin when it comes to language, but will the Minister
quantify “mainly” in that context? Does it mean 90 per
cent.-plus private and voluntary sector providers getting that
business? Is it 60 per cent., or somewhere in
between?
Mr.
Murphy: Again, I would not wish to test the patience of
the Committee by going into every detail of all the substantial
questions that the hon. Gentleman asked. They have all been fair, and I
acknowledge the legitimate issues that have been raised by others. I am
not accusing him of dancing on the head of a pin and, with my size 13
feet, there is no pin big enough to
dance on. I was not about to raise the issue of the 100 per cent.
incentivisation on outcomes, although I have had the details of it with
me at each sitting. The hon. Gentleman is right; on Second Reading, the
shadow Secretary of State for Work and Pensions, the hon. Member for
Runnymede and Weybridge, pressed the Government on such matters. He
said “A payment
of 30 per cent. of the fee up front is precisely what creates the
resource constraint which is constantly referred to as a reason for not
rolling out the programmes more quickly. Why not utilise the private
and voluntary sectors’ appetite for risk...on a genuine no win,
no fee basis...paying them only when they have not only placed
someone in work but maintained them in
work”.—[Official Report, 24 July 2006; Vol. 449,
c.636-7.]
Mr.
Ruffley: The full quote would be
nice.
Mr.
Murphy: I will read the whole lot if the hon. Gentleman
wishes. The quote can be found at column 636 of Hansard. I make
the point not to dance on the head of a pin, but to say that we simply
do not believe that constructing the contracts in terms of 100 per
cent. outcomes is the right way to
progress.
Mr.
Ruffley: My hon. Friend the Member for Runnymede and
Weybridge was talking about existing claimants. The proposal would
enable a much faster and deeper roll-out of pathways to work to include
existing claimants. Our proposition is only in relation to existing
claimants who would not otherwise get the full support because, as
resources allow, it is a constraint. I repeat that we do not dispute
the 30 per cent. up-freeze, 70 per cent. outcome model that the
Minister proposes for new
entrants.
Mr.
Murphy: Uncharacteristically, the hon. Gentleman has not
grasped the detail of what we seek to achieve. I say that that is
uncharacteristic, because I think that all members of the Committee
will acknowledge that he has taken great care to understand the detail
of the proposals, as they all have. However, I shall respond to the
specific points that he raised. The 100 per cent. outcome funding model
is not attractive for existing or future customers in terms of the
national roll-out of pathways and any future contracting.
In answer to the question about
how existing customers will be treated in provider-led pathways, I
return to my earlier comments. In the key criteria document, which we
will place in the public domain, subject to commercial confidentiality,
section 1 asks potential contractors to address the specific needs of
and barriers to all customers, so there will be no distinction or
creaming. The hon. Gentleman quite fairly raised this issue on behalf
of himself and others, and we all share his concern that contracts
should be constructed in such a way as to ensure that opportunities for
creaming are
minimal. My assertion
that we should help the newest IB claimants as a matter of priority is
based on the lessons learned and experience gained from pathways, and
on the information that the hon. Gentleman rightly gave us about people
who are on IB for two years or longer being more likely to die or
retire than ever work again. Three quarters of current IB claimants
fall into that category. What I am saying is that, at the point of
migration, my personal priority would be to move the
newest claimants across first. That is the distinction I am making about
supporting the newest claimants over and above anyone else. We are happy to learn from the
experiences gained as pathways is rolled out elsewhere in the country,
but the current approach is that the newest claimants and those with
dependent children will be first. That is the distinction that I seek
to make today and will seek to make in the future and as we migrate
people on to ESA, and that is the point that the hon. Gentleman seems
not to have grasped. I do not say that in any negative
way— Mr.
Jeremy Hunt (South-West Surrey) (Con): Say it
gently.
Mr.
Murphy: I will say it gently, rather than Ruffley, of
course. I have been making that joke throughout the Committee, but it
has taken hon. Members until now to
realise. Current
customers on IB are able to access the support available in pathways in
40 per cent. of the country. As it is rolled out—before 2008 and
before ESA is in existence—current IB customers will
beable to access the support that is available in pathways.
The distinction that the hon. Member for BurySt. Edmunds
(Mr. Ruffley) reasonably raises as a concern, will not be
there, because ESA is the benefit structure, and pathways, when it is
on the ground across 100 per cent. of the United Kingdom, will be the
enabling— Natascha
Engel (North-East Derbyshire) (Lab): I am sorry not to let
the Minister finish his sentence. On the issue of access, will he
confirm, in light of yesterday’s announcement about the 0800 and
0845 numbers, that new claimants on ESA will use an 0800 number rather
than an 0845
number?
Mr.
Murphy: My hon. Friend has raised this matter with me
pretty doggedly. Earlier this week, we announced that in future all
working age benefits information will be accessible through an 0800
number from landlines and telephone boxes, and of course we could
examine how to enable that for pay-as-you-go mobiles. It is an
important new announcement. That point of contact for Jobcentre Plus
and working age benefits will help as regards access. Hon. Members
might be interested to know that, when I had conversations with a small
group of folk experiencing mental illness, one of the things that
frustrated them was the complexity—the repeat phone calls, the
additional cost. I do not want to overstate it, but in some instances
that complexity was a barrier to accessing the support available,
because they had not yet entered the system. I can confirm that, from
2008, ESA claimants will be able to access services through an 0800
number.
Mr.
Ruffley: If it is the case that existing claimants will
get the same level of support as new claimants in the roll-out and post
2008 when ESA is up and
running, why do existing claimants only have to volunteer? There is no
mandatory requirement on them to attend
WFIs.
Mr.
Murphy: I will come back to the sentence that I was
halfway through, and then I will respond to that point. The national
roll-out of pathways will enable progressive support—personal
advisers and everything else—to back up the new employment and
support allowance from 2008.
In respect of the
conditionality that different groups will have to undertake, post 2008,
new customers on ESA, depending on whether they are in the support
group or the work-related activity group, will have to undertake
work-focused interviews and, as we roll it out, work-related activity.
Before the migration, existing customers on IB will continue to receive
the six work-focused interviews. In different parts of the country, we
are piloting to find the right mix of sanctions and conditionality in
the pathways roll-out.
It is important to put on the
record that we have made the policy decision, through the Green Paper
process and elsewhere, that from 2008, as existing customers are
migrated across, the conditionality will be in attending work-focused
interviews on the basis, crudely put, that they signed up to IB as a
certain benefit. We are changing aspects of that benefit, but we do not
think that it would be right to force existing customers, at the point
of migration to ESA, to undertake work-focused interviews and also
work-related activity. The compulsion on work-related activity will be
for new customers on ESA from 2008. That is the distinction. We can
continue that legitimate debate, but that is what we have settled, as a
matter of public policy, about where the burden of conditionality will
lie. I shall make some
progress, if I may, on a couple of other matters. In terms of
unnecessary administration, the hon. Member for Bury St. Edmunds makes
a fair point. In determining what management information and reporting
we require from providers—hopefully this will be reflected in
people’s assessment of the paperwork that can be
provided—we have tried to strike a balance between a genuinely
black-box approach, which we discussed before our break, and ensuring
proper contract management. He will recognise that it is an important
and difficult balancing act to enable flexibility in the private and
voluntary sector but also to maintain national standards, for example
in condition management, to ensure a degree of
quality. On clause 15,
all regulations, safeguards and appeals that apply to the process, such
as work-focused interviews, will apply in the same way as they do in
Jobcentre Plus. I think that the hon. Member for Inverness, Nairn,
Badenoch and Strathspey asked about
that. I hope that I
have reassured hon. Members. I had another excellently crafted,
detailed speech to read out, and with the Committee’s permission
and your indulgence, Mr. Hood, I will allow my noble Friend
the Lord Hunt to read it out when the Bill reaches Committee in the
House of Lords. That would save an awful lot of people drafting and
crafting time.
There is real unanimity about
the capacity of the private and voluntary sectors. Clause 15 enables
that roll-out to those sectors. It is an important component and
building block of the employment and support allowance from
2008.
Question
put and agreed
to. Clause 15
ordered to stand part of the
Bill.
Clause
16Income
and capital:
general 4.45
pm
Danny
Alexander: I beg to move amendmentNo. 198, in
clause 16, page 14, line 21, leave
out paragraph (a).
The purpose of the amendment is
to probe the Government’s intentions for the rules on notional
income and notional capital and the way in which those will be applied
in the context of the employment and support allowance. As the
Committee will no doubt know, the notional earnings rule—as it
applies to income support—can be applied in certain cases in
which people are not undertaking paid employment, such as voluntary or
other work, and Jobcentre Plus does not think that it is reasonable to
provide their services free of charge. That means that someone is
treated as if they were in a paid job. For example, if someone works 10
hours a week on a voluntary basis, that can be regarded as 10 hours a
week of actual employment.
The notional earnings rule
means that the notional amount of money that someone is deemed to be
earning can be taken into account and removed from income support on a
pound-for-pound basis. In other words, people’s benefit can be
reduced by an amount, even though they have not received it, because
theyare doing an activity in the community, for example, which
Jobcentre Plus deems, for whatever reason, appropriate. Likewise,
earnings disregard rules—which are pretty ungenerous
anyway—would also apply. In some cases, expenses when
undertaking voluntary work can be counted as earnings. Therefore,
someone who has had their travel expenses reimbursed could have those
treated as earnings and therefore they would count towards the
£20 earnings disregard limit.
Will the Under-Secretary
clarify the Government’s intentions for provisions on the
employment and support allowance? The notional earnings rule was
invented to tackle the situation in which people may have forgone
earnings to maximise their benefit situation. However, in the context
of a Bill that deals with work-related activity and people undertaking
activities that can help them get back into the labour
market—this point has been made on both sides of the Committee
during the course of our proceedings—activities such as
voluntary work can and should be regarded as work-related activity as
part of pathways to work or whatever.
How will those rules apply to
employment and support allowance? If necessary, will the
Under-Secretary consider a form of limited amendment to the notional
earnings rules specifically in relation to the employment and support
allowance so that people engaged in voluntary work, as part of the
process of getting closer to the labour market, can do so without being
penalised. I look forward to her response.
Mr.
Boswell: I welcome you, Mr. Hood, back to the
Committee. We are anxious to make progress and therefore I will not
detain the Committee
long. Dealing with the
generality of the clause—this is not a clause stand part debate,
and I hope not to make a speech on that—we could interpret the
amendment as being about the wording and the construction of the
clause, as it would leave out one of its crucial subsections. We should
probably impart one further dramatis persona to the Committee in the
shape of Kafka, because the idea of prescribing something as capital or
income that a person does not possess, or it is a
disregard—income to be treated as capital, capital to be treated
as income—is overtly in that vein. I would be more than
delighted if I could make that particular case to Her Majesty’s
Revenue and Customs, but I am more concerned that it might catch the
habit and start interpreting my tax schedules along those
lines. The
explanatory notes on the clause are long and particularly helpful. I
shall make one other obiter remark. The Bill is constructed rather like
Beethoven’s symphonies: the odd-numbered clauses are weighty and
important, whereas the even-numbered ones are lighter but nevertheless
perfectly delightful.
We have good meaty explanatory
notes, so I simply ask the Under-Secretary to assure the
Committee—I think it is clear from the explanatory notes that
everything in the provision is precedented and will be tied down in
regulations—that in connection with the treatment of capital and
income, the provision will not be some kind of arbitrary game, as I
jocularly suggested, and that it will be precedented in
relationto other benefits and tied down to particular
circumstances, such as the wilful evacuation of capital assets, with
which we are fairly familiar in respect of other benefits.
Having worked on the pension
credit legislation some years ago, I know that most people do not think
that the tariff for income is particularly generous to the claimant. I
shall not reopen that issue, but perhaps the Under-Secretary could give
the important assurance that she would anticipate that, unless there is
good reason to the contrary, the same approach would be taken in
relation to all benefits. This is like jobseeker’s allowance,
but the capital tariff, or the notional income, is treated as if it
were more or less the same as pension credit. It would be unfortunate
for the Department’s business if those got out of
line. I want to
reinforce what the hon. Member for Inverness, Nairn, Badenoch and
Strathspey said about voluntary work. It is an important pathway into
employment, and it is important to encourage rather than discourage it.
The level of notional income should be set with that in mind.
I have recently been in
correspondence with the Princess Royal Trust for Carers about some
exchanges that I had on other matters to do with the position of
disabled people who have family responsibilities. I believe that
currently nobody is treated as notionally in work because,
notwithstanding their condition, they have some family caring
responsibilities, although the Under-Secretary will be able to reassure
the Committee on that. The issue has not been much
mentioned.
I invite the Under-Secretary now
or in response to a later clause, possibly in relation to private
schemes, to reflect on the importance of disability employment advisers
and personal advisers reviewing the situation not just of the person
before them as the claimant but of their family. That will obviously
influence how they are available for work, the kinds of things that
theycan do, and the constraints that they are under.
Understandably, and without prejudice to our earlier exchanges about
work load, case load, box-ticking and the rest of it, people will often
tend to consider the claimant’s situation without necessarily
looking at the family in the round.
Several hon. Members properly
raised the issue of child poverty. We will not unlock that problem
unless the solutions for those now claiming the allowance are eased or
accommodated as far as possible to meet their family circumstances.
Having said that, the amendment is tabled in a certain spirit, and we
are anxious to make progress. There is no essential difficulty with the
clause, so I shall leave my hon. Friend the Member for South-West
Surrey (Mr. Hunt) to discuss disregards in relation to a
later amendment.
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