SOCIAL SECURITY BILL
Details of the delegated powers,
Part III - Benefits
242. Clause 68
re-enacts with amendments subsection (1) of section 138 of the
Social Security Contributions and Benefits Act 1992. It inserts
a new subsection (1)(b) to provide that payments out of the discretionary
social fund are explicitly divided into budgeting loans, community
care grants and crisis loans rather than being broadly to meet
other needs not met by the regulated fund. It is intended that
applicants will be able to apply for a specific type of payment,
and for an appropriate officer to determine each application according
to the type of payment applied for, which should enable swifter
243. New subsection
(1)(a) of section 138 deals with the regulated social fund and
is identical to the existing provision. It provides that there
may be made out of the social fund payments of prescribed amounts,
whether in respect of prescribed items or otherwise, to
meet, in prescribed circumstances, maternity expenses and
funeral expenses. The existing regulations (the Maternity and
Funeral Payment (General) Expenses Regulations 1987 [SI 1987/481])
will continue in force.
244. Clause 70
enables regulations to be made to provide for lone parents to
receive the same rate of child benefit for their eldest child
as couples with children. This provision is necessary because
section 145(4) of the Social Security Contributions and Benefits
Act 1992 specifically prevents regulations from reducing an existing
rate of child benefit.
(1) enables regulations to (a) revoke any provision of regulations
which prescribes a higher rate of child benefit in the case of
a lone parent; or to (b) vary any provision of regulations which
prescribes a higher rate of child benefit in the case of a lone
parent by substituting a lower rate for the rate prescribed.
will revoke the provisions in the Child Benefit (Fixing and Adjustment
of Rates) Regulations 1976 [SI 1976/1267] which prescribe a higher
rate of Child Benefit for the eldest eligible child of a lone
will also set out transitional provisions to protect existing
lone parents. Those receiving the higher rate of child benefit
on the day before the change comes into effect will continue to
receive it, so long as they continue to satisfy the entitlement
conditions. Lone parents who are currently receiving Income Support
or Jobseeker's Allowance and are not already taking up entitlement
to the higher rate of child benefit will be able to claim the
higher rate after the change comes into effect, providing they
are receiving the lone parent rate of family premium in Income
Support or Jobseeker's Allowance at the date of change, have subsequently
moved into work and have remained a lone parent continuously between
the date of change and the claim being made. Such claims will
be allowed within a month of moving off benefit.
248. Using delegated
legislation to set out the details of the change is consistent
with existing provisions which set out the conditions for receiving
different rates of child benefit in the Child Benefit (Fixing
and Adjustment of Rates) Regulations 1976.
249. Clause 72
amends section 1(2) and section 3 of the Social Security Administration
Act 1992. It provides that when a person makes a claim for benefit,
or is treated as having made a claim, they will not be entitled
to benefit for any period more than one month before the date
of claim. It also contains regulation-making powers to prescribe
different backdating periods, or exceptions in regulations.
250. The intention
is that claims to non-income-related benefits will be backdated
automatically for any period up to one month. Claims to income-related
benefits will, as a general rule, not be backdated.
251. The regulations
will also list special circumstances which will allow exceptions
to be made to the general time limits.
252. For example:
where claimants have difficulty communicating because of learning
or language difficulties; claimants who are required to deal with
a domestic emergency and have no one else to make their claim;
where a close relative of the claimant recently died; where misleading
advice was given by a Departmental officer or professional adviser.
253. The drafting
of the Clause and the interrelationship of the powers is complex.
Subsection (2)(a): a person
shall not be entitled to benefit in respect of any period more
than one month, or such period as may be prescribed, before
the date on which the claim is made or treated as made.
This will be used to prescribe
periods of more than one month for backdating in certain cases.
Subsection (2)(b): a person
shall not be entitled to benefit in such cases or circumstances
as may be prescribed, in respect of any period before that
This will be used to prescribe
that, for the income-related benefits, there will be a general
rule of no backdating. However there will be exceptions to this
rule, and these will be prescribed using the supplementary power
in Clause 75(4) which enables any power conferred by this Bill
to make regulations to be exercised "in relation to cases
subject to specified exceptions".
254. The list of
exceptions is complex and detailed and needs to cover a diverse
range of contingencies. Furthermore, the use of secondary legislation
enables additional cases and circumstances to be added or removed
in future if the need emerges.
255. Clause 77
contains transitory provisions in relation to the operation of
the current adjudication system. The provision allows for some
parts of the Bill to take effect for the period between Royal
Assent and the date on which the corresponding provisions in Part
I come into force.
(4) provides that in relation to any time before the commencement
of section 22(2)(d) (which relates to suspension in look-alike
cases), section 5(1) of the Administration Act shall have effect
as if an additional paragraph was inserted into the list of regulation-making
powers. This will have the effect of providing a regulation-making
power for the Secretary of State to suspend payment of benefit,
in whole or in part, where a case turns on an issue of law which
is being considered by the Courts in a "lead" case.
The intention is to make a regulation similar to regulation 37A
of the Claims and Payments Regulations, which was found in 1996
to be unsupported by the primary power.
257. The justification
for the use of delegated legislation is similar to that in Clause
258. As a consequence
of the Northern Ireland Act 1974 social security legislation for
Northern Ireland is enacted by separate Orders in Council (which
have the force and effect of primary legislation). It is standard
practice for social security Bills to contain a Clause enabling
the corresponding Northern Ireland Order to be made subject to
"negative resolution", rather than "affirmative
resolution". This is on the basis that the issues have all
been debated during the passage of the Bill. Use of the negative
resolution procedures means that a Northern Ireland Order in Council
can be made virtually simultaneously with the "parent"
Bill and parity between both parts of the United Kingdom can be
259. This Clause
contains a power to bring separate provisions of the Bill into
force by Commencement orders. This is a standard provision, not
subject to either negative or affirmative resolution procedure.
260. Schedule 6
deals with minor and consequential amendments to existing legislation.
29 amends section 28B of the Child Support Act 1991 (preliminary
consideration of applications for departure directions) to take
account of new provisions for revising and superseding decisions.
(2) replaces section 28B(6) and concerns what happens when a decision
as to a maintenance assessment is revised or superseded. It reproduces
that subsection's two delegated powers: (a) the Secretary of
State shall notify the applicant and such other persons as
may be prescribed of the revision or supersession; and (b)
the Secretary of State may direct that the application for a departure
direction is to lapse unless the applicant notifies him otherwise
before the end of such period as may be prescribed.
263. The intention
of section 28B(6)(a) is that where the applicant is the absent
parent, the person with care will be notified; similarly where
the person with care applies, the absent parent will be notified.
There is a similar provision for the notifications of fresh assessments
in Regulations 11-16 of the Child Support (Maintenance Assessment
Procedure) Regulations (SI 1992/1813). The intention of section
28B(6)(b) is that if the maintenance assessment is revised or
superseded, the departure application will lapse unless, before
the end of a prescribed period, the applicant indicates the application
should stand. The intention is that the prescribed period will
be 14 days (in line with other times prescribed for providing
information) but the provisions allow flexibility to provide for
a longer period should this be judged appropriate.
264. These powers
are not new; they previously applied to reviews of departure directions,
and have been amended to take into account the new provisions
in Clause 40 and 41 for revision and supersession of decisions.
37 inserts a new section 46A into the Child Support Act.
(1) enables regulations to make provision as respects matters
arising pending any decision of the Secretary of State under section
11, 12 or 17, of an appeal tribunal or of a Child Support Commissioner.
(2) enables regulations to make provision for matters arising
out of the revision or appeal of any decision.
268. This is similar
to provision for social security made in Clause 19. It is intended
that it will be used to set out ways of making an interim decision
on maintenance where the details needed to produce a full maintenance
assessment are not immediately available; for example, where a
maintenance assessment involves the calculation of mortgage interest
costs, but the full details of those costs are not immediately
available, they would allow a decision to be made on the basis
of the costs which are readily determinable. It would also be
possible to amend assessments arising from appeal decisions, for
example where the tribunal had given an incorrect effective date
in its judgement.
269. The Department
considers that it is appropriate to make such provision in regulations
because of the level of procedural detail which needs to be set
down to ensure that staff operate the procedures fairly and consistently.
48 amends section 1 of the Social Security Contributions and
Benefits Act 1992 to reflect the introduction of Class 1B contributions.
(3) amends section 1(6) of the Social Security Contributions and
Benefits Act 1992 to enable regulations to be made to detail the
circumstances in which a person is to be accepted as resident
or present in Great Britain for the purposes of determining whether
he is liable or entitled to pay Class 1B contributions. This
mirrors the current provision for Class 1, Class 1A and Class
272. The intention
is that the existing regulations will be extended to Class 1B
contributions to ensure that they are treated the same as Class
1 and 1A contributions. The provision is necessary to allow the
proper operation of the new class of contribution.
64 deals with amendments to Schedule 1 to the Social Security
Contributions and Benefits Act 1992 to take account of changes
to Class 1A contributions and the introduction of Class IB contributions.
It also introduces a new provision to avoid fractional amounts
in contributions calculations.
(2) substitutes a new paragraph 5 which contains two delegated
may (a) make provision for calculating the amount of Class 1A
contributions so as to avoid fractional amounts. This mirrors
the arrangements for Class 1 (earnings related) contributions
in paragraph 4 of Schedule 1 to the Social Security Contributions
and Benefits Act 1992. Regulation 9(1)(b) of the Social Security
(Contributions) Regulations 1979 [SI 1979/591] allows for fractional
amounts of Class 1 contributions to be rounded to the nearest
penny, with amounts of ½p being disregarded. The purpose
of the delegated power is to allow Class 1A contributions to be
rounded in the same manner.
276. As this concerns
the minor detail of how NI contributions are calculated, it is
appropriate to include the provision in regulations rather than
277. The second
of these delegated powers (b) simply re-enacts the present paragraph
5 of Schedule 1 to the Social Security Contributions and Benefits
Act 1992. Counsel has just reordered existing legislation. Regulations
have already been made under this power (regulations 22D and 22E
of the Social Security (Contributions) Regulations 1979 [SI 1979/591]).
(3) inserts a new paragraph 5A of Schedule 1 of the Social Security
Contributions and Benefits Act 1992 which contains a delegated
power to make provision for calculating the amount of Class 1B
contributions so as to avoid fractional amounts. This is identical
to the provision for Class 1A contributions in paragraph 5A above,
and the justification is similar.
(4) of paragraph 64 substitutes a new paragraph (1) in paragraph
6 of Schedule 1 to the Social Security Contributions and Benefits
Act 1992. The new wording simply ensures that regulations which
currently can be made with the agreement of the Inland Revenue
for Class 1, Class 1A or Class 2 contributions to be paid, accounted
for and recovered in a similar manner to tax will also in future
apply to Class 1B contributions.
(5)(a) of paragraph 64 amends sub-paragraph (2) of paragraph 6
of Schedule 1 to the Social Security Contributions and Benefits
Act 1992 to enable regulations to be made in relation to the payment
of interest and the imposition and recovery of penalties in connection
with Class 1B contributions. This mirrors the existing provision
for Class 1 and Class 1A contributions contained in paragraph
(7) of paragraph 64 inserts a new sub-paragraph (4A) in paragraph
6 [of Schedule 1 to the Social Security Contributions and Benefits
Act 1992]. This will provide that any regulations made in connection
with the payment of interest will not require interest to be paid
in relation to Class 1B contributions where a person has an appeal
pending to the Board of Inland Revenue in connection with the
amount of income tax due under a PAYE Settlement Agreement. As
any regulations made under this power will concern only the detailed
administration of interest on Class 1B contributions, and all
other matters relating to the administration of interest are covered
in regulations, it is appropriate for the provision to be included
(10) of paragraph 64 amends sub-paragraph (1)(b) of paragraph
8 [of Schedule 1 to the Social Security Contributions and Benefits
Act 1992] to enable regulations to be made to provide for the
maintenance and retention of records relevant to the determination
of Class 1B liability. This mirrors the existing provision for
Class 1A contributions currently in paragraph 8(1)(b).
283. The intention
is that the only records required to be kept will be those already
required for the purposes of tax. All records will need to be
kept for 3 years just as the records for Class 1 and Class 1A
(and tax) are currently. The use of regulations will provide flexibility
should operational arrangements need to change in the light of
changes introduced by Inland Revenue.
(11) of paragraph 64 inserts a new sub-paragraph (ia) into paragraph
8(1) of Schedule 1 to the Social Security Contributions and Benefits
Act 1992. This will provide for regulations to be made to enable
the whole or part of any Class 1B contributions to be repaid in
prescribed circumstances. This mirrors the existing provision
for Class 1 contributions contained in paragraph 8(1)(h).
285. It is not
intended at this time that any regulations will be made under
this delegated power, but PAYE Settlement Agreements, which are
the source of liability for Class 1B contributions, are new and
it is not known exactly how they might develop in the future.
The power has therefore been put in place to enable regulations
to be made to detail the particular circumstances in which individuals
may secure the repayment of wrongly paid Class 1B contributions
if it should become apparent in light of developments that there
are circumstances in which repayment is appropriate which are
not covered by the provisions already enacted.
(12) of paragraph 64 amends subparagraph (1)(l) of paragraph 8
of Schedule 1 to the Social Security Contributions and Benefits
Act 1992 to enable regulations to be made to allow secondary Class
1, Class 1A and Class 2 contributions to be treated as a payment
of Class 1B contributions, and for Class 1B contributions to be
treated as a payment of secondary Class 1, Class 1A or Class 2
contributions. This mirrors the existing provision in relation
to Class 1, Class 1A and Class 2 contributions contained in paragraph
8(1)(l). It will enable the detailed arrangements necessary to
allow wrongly paid Class 1B contributions to be treated as payments
of any outstanding contributions to be established through regulations
just as they currently are for contributions in Classes 1, 1A
111 replaces section 170 of the Pensions Scheme Act to apply
the provisions in the Bill relating to making, revising and superseding
decisions to decisions on pensions matters. It makes equivalent
provision to that made for decisions on benefits in Clauses 10
and 11 and its justification is similar.
117 and 118 insert new subsection (4) into section 16 and
new subsection (5) into section 17 of the Jobseekers Act. They
relate to the standardisation of description of training offences
in the Jobseekers Act. At present, for young people in prescribed
circumstances, training offences are described in section 19 of
the Jobseekers Act and decisions are made by Adjudication Officers.
For young people with a severe hardship direction, training offences
are described in sections 16 and 17 of the Act and decisions are
made by the Secretary of State. Although the descriptions in
sections 16 and 17 and in section 19 of the Act differ, they cover
exactly the same sorts of training offences.
decision-making routes are different for the two different categories
of young people. However, once all decisions are made on behalf
of the Secretary of State the legislation could confuse young
people and the staff applying the provisions. Applying one description
of training offences to all young people will avert these risks.
290. Each new subsection
contains a re-enacted delegated power to prescribe the meaning
of "training scheme". Regulation 75(1)(b) of the Jobseeker's
Allowance Regulations 1996 (SI 1996/207) currently defines the
expression and similar provision will be preserved.
124 substitutes a new subsection (1) to section 10 of the
Social Security (Recovery of Benefits) Act 1997. It provides that
any certificate of recoverable benefits may be reviewed by the
Secretary of State either within the prescribed period
or in prescribed cases or circumstances. Its purpose is
to bring the provision for reviewing a certificate of recoverable
benefits into line with the provision for revising benefit decisions
in Clause 10(1) of the Bill.