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Lord Carter: My Lords, I beg to move that further consideration on Report be now adjourned.

Moved accordingly, and, on Question, Motion agreed to.

Lord Carter: My Lords, as consideration on the Bill has now been concluded, the Unstarred Question is no longer restricted to the one hour that would have been allowed in the Dinner Break. The one-and-a-half hour limit now applies. That will allow all speakers 12 minutes each rather than the seven minutes specified on the Speakers' List. As not all noble Lords who wish to take part in the debate are present, I beg to move that the House do now adjourn until 7.30 p.m.

Moved accordingly, and, on Question, Motion agreed to.

[The Sitting was suspended from 7.2 to 7.30 p.m.]

Disability Benefits

Lord Ashley of Stoke rose to ask Her Majesty's Government what consideration has been given to the levels of disability benefits.

The noble Lord said: My Lords, the time has come for as full and frank discussion of disability benefits as we can manage within a one-hour debate. We need a constructive debate with clear explanations and sound arguments because millions of disabled people throughout Britain are alarmed, fearful and angry. They feel degraded and demoralised by assaults on their benefits and their honesty.

The initial anxiety was caused by Ministers complaining about the cost of disability benefits and comparing them adversely with education and health.

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Disability suddenly became unworthy and benefits something to be cut and cauterized like a festering wound. The alarm bells really sounded when the memorandum from Harriet Harman's department was leaked with the fateful message that "substantial" cuts were being considered. The bells became very loud when David Blunkett's letter was revealed expressing his "grave anxiety" about some of the proposals being considered.

Just in case some Tories try to make political capital out of that, and pose as friends of disabled people, I remind them that Peter Lilley, the then Social Security Minister, spoke in his 1993 MAIS Lecture of the "unsustainable growth in benefits spending". He proceeded to provide for a staggering £2.2 billion cut from disabled people's benefits.

Instead of considering cuts, we should be proud of supporting those incapable of work and helping disabled people with the extra costs of disability. We need to remind Ministers of the diversity, dignity and individuality of disabled people. For decades they have been isolated, patronised and ignored--and kept in poverty. The Labour Party, in opposition, was delighted by the widening of benefits and the improved take-up. In fact, it had an honourable role in extending this take-up. But now some Ministers, far from being delighted, are considering cuts.

In fact, the only thing that should be cut is fraud. But much nonsense is spoken about fraud. Even though my noble friend Lady Hollis has said that no evidence of fraud was found after the Benefit Integrity Project checked 33,000 cases of disability living allowance, some sections of the media kept on headlining welfare fraud. One of them said "£1 billion fraud"; another said "£2 billion fraud"; and they went on trying to outdo each other all the while with strident, glaring and inaccurate headlines. Naturally disabled people felt that they had been labelled as cheats.

We hear many snide comments that some disabled people are seen as crippled one day and cleaning windows the next. This is a grotesque distortion and a serious challenge not to disabled people but to the competence and honesty of doctors, who certify every person receiving incapacity benefit. If people are concerned about the honesty or otherwise of the awards, they should take the matter up with the BMA. In fact I wrote to the BMA a little while ago and asked what it thought of this. I wrote to the chairman. All I had was a letter from one of his juniors saying, "The chairman has asked me to look into this matter for you". I think that is a disgraceful response. I have written to the person who wrote to me to say, "Very well, thank you for your letter, but I should have thought that the chairman of the BMA himself would respond to such an important allegation against the integrity of the medical profession."

Many people welcomed the Benefit Integrity Project objective of checking that payments of the disability living allowance were accurate. Regrettably, the project has been a disaster. Disabled people have been unjustly deprived of vital benefits or had them severely cut. The Benefits Agency, incredibly, relied on a complex

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33-page form. I have to ask my wife to fill in the income tax form. I cannot bear to look at it. I could not really handle a 33-page form. God knows how she manages the income tax form, but I cannot deal with it. How can severely disabled people be asked to fill in a 33-page form when they have not been notified in advance about how important the form may be, on which their whole income could depend? There is no warning--just a questionnaire. In some cases all they had was a brief examination and in other cases simply a telephone call. How can you expect cool, rational explanations of a person's condition, given that situation?

Some disabled people were included who were supposed to be exempt such as those very severely disabled people or terminally ill people. The Benefits Agency has admitted that some mistakes have been made, so it is official that mistakes have been made by this project. I believe that the Government should order a moratorium. They should suspend the Benefit Integrity Project until this shambles has been clarified. That is all I am asking--not the ending of it but a suspension of it until sense and order can be brought to bear in the project.

I also believe that those who have been denied benefit or those whose benefit has been cut should keep their benefit until their appeals have been heard. There are tremendous delays with the appeals. Why should a person wrongly judged lose his benefit until this cumbersome appeals machinery gets into action? Natural justice dictates that people should retain their benefits until the appeal has been heard. I hope that my noble friend will take that point on board, although I know that she herself cannot wave a magic wand to solve all these problems.

However, there is no magic wand about the business of getting disabled people back to work. We know that the Government are anxious to get disabled people to work where possible. Disabled people want to work when they can. They want it for their dignity and better income because they are living on a very low income. The benefits are far too low for any enjoyment of the so-called "benefits dependency". That is a publicly peddled myth as regards disabled people. No one in their right mind believes in benefits dependency on the few quid a week that people get for their benefits.

As I say, the Government should retain a sense of perspective about getting disabled people back to work because 5 million out of the 6.5 million disabled people are either pensioners or unable to work. Therefore, the welfare-to-work scheme is not going to work for them. At most 1 million of them would be able to work if there were jobs and no discrimination. In some places there are no jobs and there is a great deal of discrimination.

I welcome any proposals to improve a system that helps disabled people to work as long as it supports those who cannot work. What disabled people do not want and should not have to face, or fear facing, are "substantial" cuts in major benefits. For those on incapacity benefit facing years, if not a lifetime, of being unable to work, financial support is essential. As I have said, today's levels of support are not generous. Those

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receiving the disability living allowance are acknowledged to have the extra costs of disability. Those costs cannot be wished away. They will remain. To cut these major benefits would be a betrayal and certainly bitterly opposed. No one should underestimate the extent of public support for disability benefits.

I conclude with a quick 10-point plan which I recommend to the Government. First, the Government should move quickly to reassure disabled people that they are not planning cuts in major disability benefits. That would draw the poison from the atmosphere. Secondly, there should be a moratorium on the Benefit Integrity project announced in order to provide the opportunity of improving its procedures without injustice and damage to innocent people. Thirdly, sensitive but stringent measures should be taken against any fraud on disability benefits. Fourthly, benefit rules which penalise disabled people who move between benefits and work and back should be changed. Fifthly, there should be established a more effective benefit for partial incapacity. The majority of disabled people do not fit neatly into the two categories of being fully capable or fully incapable of work. Sixthly, the provisions of the Disability Discrimination Act which tackle discrimination at work and provide new opportunities should be implemented and enforced. Seven: the £195 million allocated to the New Deal for disabled people, which is a tiny proportion of the windfall tax, should be substantially increased. The eighth point is that the Government should emphasise that no disabled person will be compelled to work by threats or reduced or no benefit. The ninth point is that it should be made clear that the Government have no intention of substituting local government care for cash benefits, thereby removing substantial fears. Finally, the tenth point is that the Government should consult the disability organisations and listen to them, because they know what they are talking about.

If these proposals are adopted, I have no doubt that a creative partnership between the Government and disabled people is possible and a disastrous clash can be avoided. That should benefit the Government, the nation and disabled people themselves.

7.44 p.m.

Lord Swinfen: My Lords, I should like to start by thanking the noble Lord, Lord Ashley of Stoke, for tabling this most important and interesting question. We all know that he has been a doughty campaigner on behalf of disabled people since he first came into Parliament many years ago.

The Government's election manifesto pledged support for comprehensive civil rights for disabled people. It would appear to me, however, that they are to reduce the financial benefits paid to those same people. The manifesto pledge will ring hollow if they take away the means enabling disabled people to exercise such rights.

I am a patron of the Disablement Income Group. It has advised me that it has evidence showing that the highest rate of disability living allowance, which is £84.10 a week, falls far short of meeting the extra cost

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of disability. Do the Government base their calculations on what disabled people actually spend or on what they need to spend? There is, of course, a difference, because people can only spend what they have.

Anyone with a severe disability will need additional goods and services such as extra heating; special baths or beds; extra laundry; microwave ovens for ease of cooking; food processors to liquidise food for those on special diets or computers to facilitate communication and some of the independence that the rest of us take for granted. They may need to pay for help with dressing, washing, using the lavatory, cooking, gardening, cleaning and property maintenance.

Will the Government undertake research into what is needed to be bought in and not just on what a disabled person can afford? Will they ensure that the research covers the capital cost of equipment and its maintenance and eventual replacement as well as the equipment's running costs?

I believe that I am right in saying that the level of benefit in the United Kingdom is higher than in any other member state of the EC. As a Euro-sceptic, I wonder whether the Government are proposing to lower benefits here in order to produce an EC-wide level playing field on benefits for disabled people.

The calculations that the Disablement Income Group has given me for someone with a severe disability works out as additional expenses of £261.77 a week, while the allowances he or she receives are only £84.10 a week. An example that DIG has given of typical costs of assessment is for a wheelchair user who is incontinent and who therefore generates extra loads of laundry and who needs to replace clothing and bedding frequently. In the example that I have been given there is provision for five hours of daily personal assistance, which is purchased by the individual, in addition to the care provided by the local authority. That, of course, is insufficient to meet the individual's needs. Other costs include fuel and electricity, Motability payments, medical and chemist's items, and so on.

In view of the announcement by the Social Security Minister that there is to be an independent level of review for claimants whose entitlement to the disabled living allowance has either stopped or been reduced, can the Minister advise the House what arrangements are in hand to review the entitlement of those recipients of the disabled living allowance whose entitlement has already been stopped or reduced prior to the Minister's announcement? Is the disability living allowance to be included as part of the Government's overall review of disability benefits and, if so, why has the benefits integrity programme been allowed to proceed prior to the recommendations which may arise from the review?

How many recipients of the disability living allowance does the Minister envisage will lose their entitlement, and how much a year does she forecast that that will save? Has the Department of Social Security set a target for net savings on DLA and, if so, does not that indicate that the benefits integrity programme is cost-led?

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I have one final question. What has been the Minister's response to the many representations that she has received calling for the suspension of the benefits integrity programme, and will she please advise the House on what basis that response has been justified?

7.50 p.m.

Earl Russell: My Lords, I too thank the noble Lord, Lord Ashley of Stoke, for introducing this timely debate. During the past 20 years there seems to have been a massive change of attitude among people with disabilities to which the noble Lord has contributed both by argument and by example. It is something very much like the change that happened among women about 100 years ago--a sudden refusal to accept second-class status. When something like that happens, it is a tidal wave and any politician is very unwise to stand in the way of it. Mr. Asquith learnt that the hard way. It is one point on which I hope that Mr. Blair will not follow Mr. Asquith's example.

We hear a great deal at the moment about the costs of disability. The Minister knows that I am an enthusiast for what her predecessor described as "netting my costs." Therefore, she will not be surprised to know that I should like to hear that the costs have been got completely right. This means that in addition to hearing about an increase in social security spending, I should like to know how many people with disabilities are not in residential care but, without state benefits, might have been, thereby saving a lot of money, and how many are earning perhaps quite substantial sums but who, without help, could not have been.

Recently I received a letter from one of my oldest undergraduate friends, protesting against the threat to means-test the disability living allowance. She said that for most of her life she had been a high earner but that without the disability living allowance--without the means to convert her car, without the disabled parking badge and a great deal else--she would never have been able to enter employment and the Exchequer would have been the poorer. It is a fair point.

How many people have had the weight taken off oppressed carers within their own families, perhaps to the point where they, too, can start earning? Any costing should take such points into account, as well as the direct costs of the social security budget.

I agree with what the noble Lord, Lord Ashley, said about the benefits integrity programme. It reminds me of the remark of the first Lord Burghley on the Court of High Commission,

    "Rather a device to seek for offenders than to reform any".

I also share the misgivings about campaigning over fraud. Everyone thinks that fraud should stop. I am delighted to read in an article by the noble Lord, Lord Morris of Manchester, in today's Times that the figure of £4.5 billion in relation to fraud in the disability budget has been abandoned. It should never have been put forward. When people start talking about fraud, I sometimes wonder whether we are in danger of getting something like the culture of disbelief about which both the Minister and I talked in relation to asylum seekers. That would worry me very much indeed.

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The objective of stopping fraud is a good one, but so is the objective of enhancing the dignity of those on benefit. Like the parallel objectives in the European Convention on Human Rights, the two need to be held in balance. We cannot pursue either at the expense of the other.

I agree strongly with what the noble Lord, Lord Swinfen, said about costs. We know--most of us from among our own acquaintance--that the more help that people with disabilities get, the more they can do, the more they can achieve and the more they can earn. That is something from which we all benefit. The OPCS figures on the costs of disability have been questioned for some time and I think that that questioning needs to continue.

Finally, on the subject of welfare to work, I should like to congratulate the Minister on some of the things she has achieved. I must, of course, wait to see the small print, but what has come out so far has been a great deal better than I might have anticipated. The first achievement is that this should not be a matter of compulsion for disabled people. There is, of course, a spectrum of the fully able-bodied and the fully disabled. Both comprise quite small proportions of the population. Most of us can do some things some of the time and, in that situation, the jobs that people with disabilities can do must depend on the help that they get and must, in the end, be a matter for their own judgment. One helps those who would like to work to do so, but this is an area where compulsion cannot be appropriate.

The second matter on which I congratulate the Minister is the recognition that welfare to work for disabled people and civil rights are matters between which there must be a connection. Giving people the opportunity to work is a matter of changing opportunities, transport and the attitudes of employers quite as much as it can ever be a matter of changing attitudes among disabled people themselves. One needs to show them that the opportunities are there, but one needs to create the opportunities first. I congratulate the Minister on what she has done already and I hope that she will be able to do more.

7.56 p.m.

Lord Rix: My Lords, I welcome the opportunity provided by the noble Lord, Lord Ashley of Stoke, to discuss briefly in the wake of the uprating debates the issue of disability benefits, and I welcome his 10-point plan for the Government. I hope that when the Government have come forward with the proposals for change, about which we have heard so many worrying rumours and so little reassuring information, there will be an extended opportunity for parliamentary debate and that those 10 points will be well remembered. The Government might like to consider through the usual channels setting up a special committee of both Houses to take evidence in public.

I believe that it was the journalist Katharine Whitehorn who wrote:

    "A good listener is not someone who has nothing to say. A good listener is a good talker with a sore throat".

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I may not be a good talker, but I certainly have a sore throat, so I should like to restrict my remarks to four points.

Perhaps I may begin by illustrating the seriousness of the issues with a personal story. A man with learning disabilities--I believe that he is known to the Minister--whose sole income is income from benefits, and whose benefits have been threatened by what I take to be the starter to the Government's broader review, had been a loyal supporter of the Minister's party. He remarked recently that he no longer believed that the Government cared. I hope that they do care, but I have to confess that if they do, they have a funny way of showing it.

My first point is that in the majority of cases we are not talking about additional income, we are talking about total income--about people who have only one source of funding for their survival in the community, their income from social security. It is hardly surprising that people whose sole income is threatened should feel threatened themselves. To talk about community care without social security is like talking about breathing without oxygen or swimming without water.

My second point is that we are talking about a level of income which provides for a week the sort of sum that many of us would not think it unusual to spend on a single meal with friends. That is an income designed to cover both basic needs and extra disability-related costs--and I emphasise again that we are not talking about transitional benefits between job and job, but about benefits which in reality will sustain someone throughout their adult life.

Thirdly, there is very little room for manoeuvre in the reform of benefits but there is room for improvement. There is a possibility of cutting benefits to make life easier for the taxpayer, but a scheme that does not recognise basic maintenance costs, additional care costs and mobility costs is one that ignores the realities of disablement. I am suspicious of a desire for simplicity that puts simplicity before adequacy. No doubt the desert is simple but it is not a place where most of us would choose to live.

My last point is that publicity--which sometimes appears to be orchestrated--has been concentrated on the increased number of people who claim disability benefits. The problem is that people do not claim the benefits to which they are entitled. Council tax rebates that may be described as benefits, since they have a cash value, and MENCAP's report published this week on the council tax carer's disregard, show that very many families with a disabled member lose out because they are not being advised that they can claim. I am aware that Ministers are anxious that older people, who include the majority of disabled people, should claim their benefit rights. Can one assume that the same is true for all disabled people and that the Benefits Agency will address this?

I am sure that we all extol the New Deal. I am equally sure that the idea that benefits are out and work is in for disabled people is to expect too much from work as an answer to the problems of a group the majority of whom are over pension age but few of whom are without extra costs and lower incomes. Surely, the New Deal is not

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intended to follow the advice of the Second Epistle of St. Paul the Apostle to the Thessalonians, chapter 3, verse 10:

    "For even when we were with you, this we commanded you, that if any would not work, neither should he eat".

What kind of new deal is that?

8.2 p.m.

Lord Addington: My Lords, this is one of those debates in which I have the familiar feeling in winding up that everything has gone before me. On a night when beacons are being lit for the countryside lobby all over the place I feel like someone who has shot every available fox. These foxes are rather fat and have been moving rather slowly across open ground. Nonetheless, they have lots of holes in them. I may fire the odd shot myself but I have a nagging suspicion that I shall not be the last one to do so in this debate.

The Minister has already received praise for the work that she has done in trying to calm down the amount of panic that appears to have been created over this issue. We have heard a great deal in the press about the fact that people may not be left with anything on which to live and may not be able to meet their basic needs. It is also said that every other disabled person is probably a fraudster. One feels that a second miraculous coming must be near because a good number of people have been picking up their beds, wheelchairs and disabled cars and walking or running around the place; in other words, a lot of rubbish has been said by a lot of people, many of whom are half-briefed. I hope that this opportunity will be taken to put a brake on this, even if we cannot stop it. Very little that is constructive has come out of it.

The Government's leaked announcements led to a ferocious backlash on the part of disability groups. I cannot blame them. Many of them felt that their lives had been threatened by those who represented them. Very few of these people live rich, happy benefit-dependent lives. Most struggle to get by. That reaction was not because people had been given the perception of privilege but because disabled people were worried about being unable to cope.

Reference has been made to the fact that an attempt is being made to give people full civil rights. I put to the noble Baroness, Lady Blackstone, a supplementary question to a Starred Question. It was agreed that the two matters were inextricably linked. I hope that the Minister will tell us that the Government's new attitude to disability benefits will include a greater degree of pump-priming (if that is not too mechanical an expression) to ensure that the disabled can deal with their transport, communication and other problems and get into the workplace and thus play a greater part in society. This may not mean just getting a job, although that is ultimately where one wants to place them so that they can pay back the Exchequer by way of taxes--surely that is something that is worth investing in--but ensuring that they are not trapped at home and that their quality of life is enhanced, for the very simple reason that that is the sign of a civilised society.

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It is to be hoped that the steps that we have taken so far will be guaranteed and that further attention is paid to this process. As my noble friend, with his keen eye for the historical anecdote, has pointed out, people must be able to take their place in society as full members. If we adopt the same historical anecdote, it is worth remembering that over 20 years ago the last legal bar to women's equality in the workplace was removed. For as many years as I can remember it has been said that women need greater support to achieve equality. It never stops. We must be on our guard in areas like this. If it does stop it probably will not happen in the lifetime of anyone in Parliament today. The Government have an opportunity today to state clearly their true position and how they propose to make progress and to kill off some of these very unhelpful rumours.

8.6 p.m.

Lord Higgins: My Lords, in the short time that I have been in this House I have learnt that it is a good idea to be modest when speaking from the Front Bench because of the great expertise to be found on the Back Benches. However on this occasion in particular one speaks with great diffidence because those who have spoken are not merely very expert but have made tremendous contributions to the lives of disabled people.

It is appropriate that this debate should be initiated by the noble Lord, Lord Ashley, who for many years has passionately pursued the cause of the disabled and done a great deal to help them. That is also true to a very large degree of the work of the noble Lord, Lord Rix, in MENCAP and the work of my noble friend Lord Swinfen in the Disablement Income Group. For all those reasons I believe that this has been an extremely helpful debate. Among others who have made a major contribution in this field is the noble Lord, Lord Morris of Manchester, who I understand is not able to be here this evening. Nonetheless, he wrote a fascinating article in today's issue of The Times, to which I shall refer in a moment.

The theme of this debate is that the Government's review has generated a real sense of fear and alarm among many of those who are on social security benefits, particularly the disabled. To take just one example, the Royal National Institute for the Blind, in a briefing, has expressed concern that the review of disability benefit appears to be solely--I stress that word--motivated by the need to seek reductions in current expenditure. Rather to my surprise, it goes on to seek an assurance from the Government that they will stick to the previous Government's proposals for public expenditure in this field; namely, a 2 per cent. real increase in social security expenditure in 1998-99 and a 1.8 per cent. increase in 1999-2000. Perhaps the Minister can give that assurance, which would help to convince people that this is not simply a Treasury-driven exercise.

However, it is not surprising that that impression is created. In the Social Security Bill, which we shall debate later in Committee, we had the proposals for restrictions on backdating. We have also experienced the

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effect on pensions of the change in ACT provisions, the pensions rebate to which I referred earlier this week and the issue of lone parents' benefits.

In recent weeks, I have spent much time watching skating on television. The Government seem to have made an initial U-turn, reneging on their original assurances in Opposition. Yesterday morning we had a second U-turn, and in the afternoon a third when the Prime Minister denied the whole thing. There is no record of a woman skater managing a quadruple jump of that kind. However, we must wait to see whether that applies in the case of the Secretary of State. I do not suggest that in conjunction with her partner she will go into that well-known skating exercise, a death spiral. We are facing a real problem and I hope that tonight the Minister will give some reassurance.

I read in today's newspaper a quotation from Jack Straw, the Home Secretary, at another well-known road show. We now know that in no sense are these national debates but serious party political meetings designed to reassure Labour voters. Surprisingly, he stated that the previous government spent an extra £44 billion in real terms on social security, which was an increase of 67 per cent. He somehow seems to believe that that was a bad thing. I am puzzled as to why the Home Secretary should have taken that view. However, it reinforces the opinion that this is an expenditure-cutting exercise, which is of real concern.

I turn to the article written by the noble Lord, Lord Morris of Manchester. He quoted the noble Baroness, Lady Hollis, but I am not sure that he quoted her correctly. No doubt she will be able to tell us. He wrote in his article:

    "We have, so far, in the 35 per cent. of cases we have examined, not found a single case of confirmed fraud".

The noble Lord, Lord Ashley, referred to 35,000 cases, which I believe is the correct figure. At all events, if that were so it would radically change the views held by the previous government, which we understood to be right, that we must carefully consider the whole issue of fraud. If the results are as dramatic as the noble Baroness stated in her previous remarks, we must consider whether the cost of the exercise is worth while. It is a dramatic finding, indeed.

It would be helpful if the Minister could tell us why, if the massive increase in expenditure is not due to an increase in fraud, she believes that the increase has been so dramatic. There can be no doubt that it has been a dramatic increase. One of the reasons is that in 1992 there was an extension of categories. Clearly, there has been a better take-up, which Members on all sides of the House would welcome. Furthermore, there has been a shift from the number of people in hospital to the number in the community who are dependent on benefit. It would be ironic if, people having moved into the community, benefits were cut and the expenditure went back into the health service to be spent on some other group. It looks as though that will happen if we are not careful.

Noble Lords rightly stressed the problems of means testing or taxing disability benefits. The crucial point is whether any reduction in absolute terms would

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significantly reduce the ability of those on such benefits to engage in work. It must be inconsistent with the Government's fundamental welfare to work programme to make cuts which would reduce the number of those in work, resulting in a net loss to the Exchequer. That would not be a desirable change and the issue needs to be analysed most carefully.

As the debate is time limited, I shall make only one further point. Considerable concern has been expressed about the way in which the so-called benefit integrity project has been operated. I understand that the Secretary of State has said that where a reduction in benefit is likely to result there will be an extra check to ensure that it is appropriate. Against the figures which the noble Baroness quoted for fraud, it is difficult to understand that exactly. However, it would seem to be a matter of reducing the benefit rather than arguing that it is fraudulent. I am pleased to see the Minister indicating that that is the position.

A little while ago I saw on television the second half of a programme examining the issue. However, I saw it when I was abroad and therefore I am not sure of its entire content. Certainly, it suggested that the way in which the benefit integrity project was working was not wholly satisfactory. If there is to be an appeal against those decisions I believe that all of us in the House would support it.

We are grateful to the noble Lord, Lord Ashley, for initiating the debate. Reassurance is needed and I hope that the Minister can give it tonight. Perhaps she can also indicate why she believes that the disabled budget has expanded and what further plans the Government may have with regard to reforms in this area.

8.17 p.m.

The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham): My Lords, I am grateful to my noble friend Lord Ashley, who for many years has been so eloquent an advocate for disabled people, for giving us the opportunity to discuss the important issue of disability benefits. We have all listened to tonight's speakers with intense interest.

We are determined to review and reform social security, to promote work incentives, to reduce poverty, to strengthen family life and to extend opportunity and security to all. Reform, particularly in the area of disability benefits, will not, cannot and should not happen overnight. The Government are committed to ensuring a full consultation with disability organisations on any proposals for change that we may bring forward. My noble friend Lord Morris--he greatly wanted to attend tonight, but due to a hospital appointment was unable to do so--raised with me the idea of a seminar with disability organisations to discuss benefits, in particular the disability living allowance. I shall pursue that idea with my noble friend. Such a seminar could allow us to discuss in greater detail than is possible tonight some of the questions raised by my noble friend

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Lord Ashley. He had a list of 10 questions, some of which I hope to answer, but others need fuller exploration than we can give tonight. It is important that we all own the issues, the difficulties, the problems and the concerns which can be associated with DLA.

However, I can reassure the House that those in need, such as those with an illness, disability or caring responsibilities, will always be supported by this Government. Our review of sickness and disability benefits will be judged on the two clear objectives that we have set; namely, getting the right support for people who want to work and getting the right mix of cash and services to people who cannot work in order to enable them to live independently and with dignity.

So what is our strategy? As the noble Lord, Lord Higgins, asked me to do, I should like to make it clear again that our strategy is not a cost-cutting, Treasury-driven exercise. As your Lordships will know, there are two basic benefits--earnings replacement benefit, such as incapacity benefit and the extra cost benefit, DLA and attendance allowance. I shall deal with each of these in turn.

I deal first with incapacity benefit. We inherited a benefit regime which focuses heavily on people's incapacities rather than their capacities. And yet, as my noble friend Lord Ashley said so wisely, the majority of disabled people do not fit neatly into categories of fully capable or fully incapable of work. Many claimants are capable of some work and may want to support themselves through work but find the current system both confusing and frustrating. Efforts by disabled people themselves to manage their disability and re-enter part time or full time work are often discouraged by the benefit system. This cannot be right for them and it cannot be good for society, which loses their talents and their initiative. We cannot afford to lose either.

We are now considering carefully the appropriateness of the all work test as we develop our proposals on a fairer benefits system for disabled people--one focused on work and capacity rather than worklessness and incapacity. We need to regard IB as a benefit which fulfils a range of needs--supporting disabled people who have recently left or lost their jobs until they are ready and able to return to the labour market, as well as those who are unlikely ever to work again. While they are unable to work we need to help sick and disabled people to develop their "rehabilitation package" and, importantly, to work with employers to keep their job open and to make reasonable adjustments for a planned return to work.

We also need to provide a new deal for disabled people who have been out of the labour market for some time, and we have had encouraging words, for which we are grateful, from the noble Earl, Lord Russell, on that aspect. It has been mentioned positively tonight and more widely; it has received a very supportive response.

There are more than 1 million disabled people of working age without jobs who tell us they want to work and £195 million available under the New Deal will finance pilot schemes and personal advisers for people with a disability or long-term illness, so that we learn

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how best to help them on a voluntary basis to move into or remain in work. And we are working closely with disabled people and the organisations that represent them. We recently met around 200 disability and other groups who recently attended briefings as potential bidders under the innovative schemes strand of the New Deal.

We are also developing plans for a personal adviser service to help and encourage disabled people who want to work. We are working with them in order to encourage employers to bring them back into the labour market.

We must also review the benefit system to ensure that disabled people are not discouraged from seeking part-time, full-time or voluntary work by the working of the benefit system itself. We need, in other words, stepping stones--the opportunities for some work within welfare without loss of benefit; imaginative welfare to work proposals as outlined for the New Deal; and, thirdly, welfare in work--helping people retain or regain their jobs, giving support to employers to help disabled people to do so and, as many noble Lords have said, backing this with clear, explicit, enforceable civil rights.

For those who are unable to come back into work by reason of their age or their degree of impairment we must, as the Prime Minister has stated, ensure that disability benefits are set at a level which provides them with the proper help and support they need. I entirely take the point made by the noble Lord, Lord Rix, in that regard.

If incapacity benefit is one strand of benefit, the other is the extra costs benefit--DLA. DLA is the second major benefit available to disabled people. That benefit helps towards the extra costs of disability, assessed on someone's care and mobility needs. It is a valuable and highly valued benefit, but it is often misunderstood. It is not an earnings top-up benefit, nor is it compensation for the disability. It is designed to help with the additional costs arising out of the disability which often result in the need to pay for care or mobility solutions and other costs of managing their disability. This may mean that one person with, say, a moderate mental health disability could have higher care needs and higher DLA as a result than someone with a severe physical disability.

It means that two people with much the same disability could nonetheless have different care needs. As your Lordships will know, there is no automatic read across from the severity of the disability to the degree of need and costs for DLA purposes. If someone's disability improves and their care needs reduced--they no longer need frequent night-time attention, for example--then the DLA will properly reduce, even if the original award was a life award, because it was for life only while the original condition and the original needs it generated remained unchanged. Disabled people are rightly free to spend their DLA on carers or taxis, but they may also spend it on a piece of IT equipment or on the mortgage for a ground-floor extension so that they can continue to live at home. It is a vital benefit

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which goes some way to ensuring that the extra costs of disability are shared with society and not shouldered by the disabled person alone.

I turn now to the benefit Integrity Project of Disability Living Allowance. As your Lordships have mentioned, there was a great deal of misinformed media coverage since just before Christmas which may have frightened some disabled people quite unnecessarily. I share the concerns of noble Lords about the way the work of this project has been misrepresented.

I want to set the record straight and to reassure your Lordships, disabled people and their organisations that the Government are acting responsibly and sensitively in carrying out this exercise. First, I want to make it clear that the benefit integrity project is nothing to do with the wider review of disability benefit, nor is it about fraud. It is about checking that payments of DLA are being made correctly under the current rules. None of the rules has changed. The conditions of entitlement remain exactly the same.

The exercise involves gathering up-to-date information about the care and mobility needs of people receiving DLA. People are contacted either by home visit or by post--not, I believe, by telephone--and asked to complete a detailed questionnaire based on the current DLA claim form. The BIP covers people receiving the DLA higher rate mobility component with either the middle or highest rate of the DLA care component, plus people in these groups who are seeking a renewal of their claim. That will involve contacting over 400,000 people. My noble friend Lord Ashley referred to that matter. I am delighted to confirm and correct the misrepresentation that was in The Times today. There is absolutely no suggestion that disabled people are claiming fraudulently. The noble Earl, Lord Russell, and my noble friend Lord Ashley are right to emphasise that.

Up to the end of December, more than 40,000 cases of DLA had been examined. The noble Lord, Lord Swinfen, asked me how many people might be affected in the future. I should tell him that 400,000 people fall within those categories, and the noble Lord will understand what the implication of the statistics might be. Of those 40,000 that we have looked at, the majority--about 80 per cent.--required no change whatever in their DLA award. We were able to confirm that benefit is being paid correctly. Of the remaining 21 per cent. or so, 7,500 have seen a reduction because their care needs have reduced. But equally, almost 1,000 people had their benefit increased. The noble Lord, Lord Rix, is right that that is an issue which continues to be addressed.

I do not believe anyone here disagrees with the principle that benefits should be paid to those who are entitled to them and not paid to those who are not. The project is all about making sure that we are paying DLA correctly. But we know that with DLA in particular awards are vulnerable to changes over time. That is simply because the health of disabled people and their care needs may improve or they may deteriorate. That is the nature of their disability or long-term sickness.

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If someone is incorrectly receiving DLA and receiving more now than they should because their care needs have changed, it is right to stop those payments. However, in some cases, we are not getting the project right. That is why my right honourable friend the Secretary of State for Social Security acted to introduce an extra safeguard to help us get it right. From 9th February--I hope that this will answer the question raised by the noble Lord, Lord Higgins--no decision taken by the project resulting in reduction or removal of entitlement to DLA will be made solely on the evidence provided by the claimant. There will always be additional evidence to support the decision.

Some people unintentionally understate their needs. One of the most frequent examples is that disabled people asserting their independence tend to underestimate their needs for night-time care. If they do so, they may find themselves moving down from a higher rate to only a middle rate level of care under DLA. However, where someone has unintentionally understated their needs, we will be able to ensure, before we reduce their benefit accordingly, that the statement is full and complete; in other words, it will be amplified with further information from, say, a carer or from his or her own doctor. We want to get the award right and we need the fullest information possible to do so. It is clear that we have not always had the fullest and clearest information. As a result, in some cases, the award has been reduced but then reinstated when we received the additional information.

That example shows that the Government take their responsibilities very seriously. Disabled people have nothing to fear from the benefit integrity project. We are also carefully considering what else can be done, and I hope that the disability organisations will help us to identify further measures by which we can ensure that BIP does what we want it to do; namely, to ensure that the right level of benefit goes to disabled people. Obviously, tonight's debate will make an important contribution to that extent.

I was asked a number of questions during the debate. I should now like to address those points that I have so far not been able to mention in my reply. The noble Lord, Lord Swinfen, asked whether DLA was based on what people really need as opposed to what they currently spend on the cost of disability and whether we would embark upon research and seek further evidence. I am well aware of the additional cost that disability or long-term illness can bring. DLA is designed to help towards the extra costs arising from disablement. There is of course further help from the premiums in income support for those who are on lower incomes, which is worth up to another £37 a week for a single person.

We are also very dependent upon research and well aware of the sterling work that the Disability Income Group has carried out, especially the research of Ann Kestenbaum on the cost of disability. We are clearly taking that research into account as we review disability benefits.

The noble Lord also asked what would happen to people who have already had a decision made to reduce or alter their level of benefit. On the information that

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we have received, we are satisfied that we have acted correctly up until now. All decision notices carry information about claimants' rights of review and appeal. If it is the belief of anyone--or, indeed, if his or her carer, friends or family believe--that a decision made in a case was incorrect by virtue of incomplete information being given to us, they should contact the Benefits Agency in the normal way. We shall of course be more than happy to take the matter forward.

The noble Earl, Lord Russell, asked several questions. For example, he asked about those in residential care and those who otherwise would be were it not for disability benefits. He asked about those earning substantial sums who would not be able to work but for disability benefits. He asked about the implication for carers and what the implications would be of reducing those benefits. The noble Earl will know that these are essentially qualitative questions, but they are no less real for being qualitative rather than quantitative. However, the noble Earl went on to ask me to confirm the figure of £4 billion a year quoted by my noble friend Lord Morris from yesterday's issue of The Times. I am not sure exactly where my noble friend found that figure, but I think that it represents the total level of estimated fraud within the social security system. It is certainly not a figure that I am aware of as ever having been attributed to disability benefits. We are looking into the matter to ascertain whether that figure is an accurate one. Certainly, anyone who has seen the recent television programmes focusing on housing benefit and Lambeth Council may feel perhaps that the previous government underestimated the amount of fraud that there may be in some areas of benefit. However, it is certainly not a figure associated with disability benefits.

I am happy to confirm that of those people who have had their awards checked for DLA no one has had a case of confirmed fraud established, although something like 40 cases have been referred for further investigation where there is a serious question about the authenticity of the award.

The noble Lord, Lord Rix, asked what we are doing about publicity for reductions in council tax liability for disabled people. Local authorities are responsible for the billing of council tax and the relevant forms will generally explain how to claim a reduced liability. I have a personal interest in the matter, as I was one of those responsible for moving the amendment when it went through this House which abolished the poll tax and put the council tax in its place. Therefore, I have a particular interest in ensuring that disabled people and their carers claim what they are entitled to. It may be

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appropriate for us to revise the wording of the leaflets to make that eligibility for a reduced council tax more clear and obvious.

Finally, the noble Lord, Lord Higgins, asked me to explain why there had been an increase in disability benefits and why that has taken place if we do not attribute it to fraud. The noble Lord himself gave us some of the answers. I do not think that this is, in any sense, a point-scoring exercise. There is no simple answer. As the noble Lord said, we know that there were major increases in claims following the introduction of DLA in 1992. We know that expenditure far outstripped expectations, perhaps because of the degree of unmet need. Again, we accept the noble Lord's point that some of the costs arose because of the move to care in the community, which meant that we were switching money across budget headings. We know that people are living longer and, as many noble Lords mentioned tonight, disability is particularly associated with frailty in old age.

As a result of both government's efforts as well as the work of the disability organisations, we know that there is a wider knowledge of benefit entitlement available. We also know--and this is something about which we are concerned--that it is not so much that more people are going on to benefits like IB but that they are failing to come off them and are staying on them for longer. That is why we have taken the response in terms of welfare-to-work measures to try to be active in encouraging people not to linger on with benefit which is perhaps no longer appropriate for them.

Further, we also know that in some cases the courts may have extended the policy intentions of the framers of those benefits beyond the original intent. I have given the House some explanations in that respect. However, according to what the information coming from the current disability survey on the extent of disability shows, we may be able to arrive at clearer findings in that respect.

In conclusion, I should like to thank all noble Lords who have spoken this evening. We have had a short but most valuable debate. In this, the 50th anniversary year of the welfare state, it is worth reminding ourselves that one of the tests of a civilised society and a decent welfare state is one which recognises and values the contribution that all disabled people bring to society. I hope and believe that all the speakers in tonight's debate have done just that. I thank all noble Lords.

Lord Carter: My Lords, I beg to move that the House do now adjourn.

Moved accordingly, and, on Question, Motion agreed to.

        House adjourned at twenty two minutes before nine o'clock.

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