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Lord Higgins: The noble Baroness keeps saying, "Before the Bill leaves Parliament", but can she give us an assurance that we will have a specific proposal before us at Report stage?

Baroness Hollis of Heigham: If I was able to say to the noble Lord that he would have the proposal before Report stage, that is what I would have said. The fact that I did not say that means that I do not intend to say that. I repeat: the noble Lord--all of us--will have that measure before the Bill leaves Parliament.

Lord Higgins: That is not satisfactory. It means that on Report--probably with the support of the noble Lord opposite--we shall need to put forward our own proposals on this matter and then, in effect, flush the Government out. We really cannot let the matter go on beyond the stage where the House can take a view on what the Government propose. Procrastinating in such a manner is not a satisfactory way to treat Parliament. I am glad to see that I have the support of the Government Chief Whip, who has rapidly changed from nodding to shaking his head, but whose first reaction was the correct one.

With some hesitation, but largely because I am not in favour of passing into legislation defective amendments-- the noble Baroness pointed out that the amendment is defective--I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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Lord Rix moved Amendment No. 56:


Before Clause 14, insert the following new clause--

Definition of Remunerative Work: Disabled Persons Tax Credit

(" . The definition of remunerative work in respect of which a disabled person's tax credit may be payable shall include remunerative work for less than 16 hours a week as set out in--
(a) section 129 (disability working allowance) of the Social Security Contributions and Benefits Act 1992; and
(b) section 128 (disability working allowance) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992.")

The noble Lord said: Before I speak to Amendment No. 56, perhaps I may remind your Lordships that in Committee last week I paid tribute to my noble friend Lady Darcy de Knayth for her constant attention to our debates on disability. Unfortunately, she is unable to be in her place tonight but I am happy to announce that her understudy is the noble Lord, Lord Swinfen, who will say a few words and will no doubt give his usual immaculate performance.

This amendment abolishes the requirement for disabled person's tax credit recipients to work 16 hours or more per week in order to be eligible for financial support. I explained my reasons for favouring a relaxation of this rule at Second Reading. Many people with learning disabilities may be able to do some work, but may not be able to undertake full-time work. This is not just an assertion; this is the direct experience of MENCAP's employment service, Pathway, which finds that many people with learning disabilities benefit from part-time work. This can often develop an individual's skills or self-confidence and may act as a springboard on to positions involving more hours.

Under current proposals, the system is being carved up to create arbitrary exclusions from in-work benefits. People find that they can work up to four hours on the minimum wage and keep hold of income support and housing benefit; people can work over 16 hours and receive support from the disabled person's tax credit; and people can work for very specific therapeutic reasons and retain benefits. But those who undertake ordinary work for between five and 15 hours per week are afforded no support, even if the work that they do extends their capabilities and promotes their social inclusion.

This is, of course, an idealistic amendment, open to the charge of spiralling spending and liable to draw the predictable response of "We have to draw the line somewhere". My expectations are, however, very realistic. I should like a commitment from the Minister that her department will explore ways of assisting disabled people who work between five and 15 hours, perhaps through a phased entry to the tax credit. During the Second Reading debate, the Minister alluded to the possibility of pilot schemes. Perhaps she might like to tell the Committee in a little more detail about her thinking in this area.

If the ideas are in their infancy, I am sure that disability organisations would welcome the opportunity to discuss this matter further with the Minister and/or her officials. I beg to move.

Lord Swinfen: I am very happy to support the noble Lord, Lord Rix, but not as the understudy of the

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noble Baroness, Lady Darcy de Knayth. I hope that she, the noble Lord and I work as a team from different parts of the House in trying to support people with disabilities. In the past I can recall frequently having the support of the noble Baroness, Lady Hollis of Heigham, and the noble Lord, Lord Carter. I now have the support of my noble friends Lord Higgins and Lord Astor. Wherever I am in the House, I seem to be agin the Government. Therefore, I must be right because governments are not always right. They sometimes forget that they are as human as the rest of us. I have a horrible feeling that most of the time the Treasury tells them what they may do and not what they would like to do. As I have said before, the Treasury seems to have no experience outside the Treasury. It does not really know how the real world works.

I support what the noble Lord, Lord Rix, said in asking the Government to consider ways of supporting a greater number of low-paid disabled people in the workforce. However, we must not forget single parents with very young children, particularly those living in sparsely populated rural areas where there is likely to be a dearth of registered child minders and where they may be too far away, either in distance or time, to be of any practical value. It seems that there is a disproportionate concentration on full-time work in the Government's welfare-to-work strategy. Full-time work benefits the Treasury greatly. But let us not forget the benefit to thousands of people who work part-time. The benefits system should not mitigate against part-time work for those who wish to try it and where it is the only work they can practically take.

Lord Higgins: I support the noble Lord, Lord Rix, and the strength of his arguments and those of my noble friend because, when this point was debated last Monday, the first day in Committee, the noble Baroness asked why I was not supporting the noble Lord, Lord Rix. I said that I thought it was obvious that I supported the noble Lord, and I stood up and did so formally, whereupon the noble Baroness turned down the amendment. I thought that rather unfair. I have great pleasure in supporting the noble Lord's proposal.

Lord Goodhart: I, too, support the noble Lord, Lord Rix. This is an extremely desirable amendment. Certainly, the noble Lord made a very strong case as an exception to the general principle that tax credit should be payable only where there is a substantial amount of work. There is a strong case for the more limited hours of therapeutic work in the case of the those claiming disabled person's tax credit. I hope that the Government will look upon the amendment sympathetically.

9.15 p.m.

Baroness Hollis of Heigham: The purpose of the amendment is to redefine remunerative work for disabled people to include work of less than 16 hours a week. I am sorry to disappoint the noble Lord, Lord Higgins. It is clear that whenever he stands up to support the noble Lord, Lord Rix, he brings with him faint comfort. He might be advised in future not so energetically to do so.

4 May 1999 : Column 646

There is a real difficulty here. The issue concerns us all and has aroused much discussion from the day DWA was introduced. We all want to see and help disabled people into work. Members of the Committee will not need reminding that this Government have introduced a new deal for disabled people with pilot schemes across the country. We are introducing personal advisers and work trials for disabled people. Also, I am pleased to report that, as of last October, we have been able to introduce the linking rules so that disabled people who move into work and then find that they cannot sustain work can return to the higher level of benefit and not, so to speak, go down the snake and to lower rates and have to climb up. Thus we have reduced some of the risk--laid off the risk, as it were-- on to the government benefits system. I do not think there is any dispute between us, on all sides of the Chamber, that we want to do everything we possibly can to help disabled people back into work. After all, the 2 million or so people on incapacity benefit once had a job. It would be to their pleasure and to ours if we could encourage them back into work.

But disabled person's tax credit, like WFTC, is not primarily an income support benefit; it is a work support measure. We have to make a distinction, a definition of what counts as work, so that on one side there are work support benefits--currently family credit, in future tax credit--and, less than the dividing line of work, what we then get is a disregard for some part-time earnings to support income support or disability benefit. The question is whether that line is properly drawn at 16 hours. We believe that it is.

Sixteen hours represents two full days a week or three to four part-time days a week. We believe the 16 hours is the point at which there is a clear commitment to work, which entitles a person who meets the other criteria to the much more generous in-work support provided by DPTC rather than out-of-work benefits. We want to ensure that the system helps, rather than hinders, people who want to move from benefits to work.

Disabled people who work less than 16 hours are, of course, able to keep the first £15 of their earnings. We particularly want to overcome the lack of awareness of the therapeutic earnings provision within incapacity benefit. Therapeutic work is a valuable opportunity. It is a first step back to independence. The therapeutic earnings limit has been increased this month from £48 to £58 per week. So effectively there is already a series of steps. People have a disregard when working modest hours of £15 to top up either income support, disability premium or incapacity benefit. People may be doing therapeutic work in which case they can keep £58 a week of the earnings from that. Finally, if they work more than 16 hours, under the qualifying benefit rules or fast track procedures people may be entitled to DPTC. This improvement, together with the greater generosity of DPTC compared to DWA, and the proposed new fast-track gateways to DPTC will, we believe, greatly enhance work opportunities available to disabled people.

We are keeping under regular review all aspects of the DPTC. We have discussions with the Disability Benefits Forum and are piloting possible improvements

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to tax credit. We certainly plan to use pilots on various aspects of both WFTC and DPTC. However, I am afraid that I cannot, despite the invitation to do so, give any commitment as to what aspects of the DPTC will be piloted. However, I shall certainly bear in mind the concerns and issues raised in this debate. I am sure that the disability organisations will note them.

I believe it is right to say that a person who works 16 or more hours a week is in work and that therefore the benefits that are appropriate to supporting someone in work apply to that individual, but that someone who works less than 16 hours a week is essentially either in part-time work with a disregard or is engaged in therapeutic earning. While I understand the intention of the noble Lord, Lord Rix, in moving the amendment I regret that I am unable to accept it. I ask the noble Lord to withdraw his amendment.


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