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Lord Goodhart: My Lords, I am most grateful to the noble Baroness. Perhaps she would be well advised to wait to hear what I am going to say in winding up on the debate.

Baroness Castle of Blackburn: Yes, but I was having a little tete-a-tete with Earl Russell. I spend a great deal of time in this Chamber listening to what he says, so I thought that he would want to explain whether what the Bill proposes on the state second pension had converted him. I still wait--

Earl Russell: My Lords, perhaps I could make it clear that in this Chamber my noble friend Lord Goodhart speaks for these Benches on pensions.

Baroness Castle of Blackburn: I am surprised to hear that. I have heard a great many words from Earl Russell about pensions. Never mind; if the Liberal Democrats have two spokesmen on pensions, the more the merrier, as long as they end up with one policy.

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The restoration of the earnings link is not just a rather pretty idea, as some of us have said. It basically affects the whole structure of pensions if you look at it as a whole. Take, for instance, the crediting-in proposals in the Government's provisions. I, of course, welcome the announcement regarding people earning between the lower earnings limit and £9,500 per year, which is--I believe that I am right--only half average national earnings. Half national earnings has been defined on more than one occasion as the dividing line between rich and poor. Of course I welcome it. But what people do not realise is that when we drew up our pensions scheme, the lower earnings limit was fixed to tally with the basic state pension. If the earnings link, which was an integral part of that policy, had not been abolished by Lady Thatcher's government in 1980, that basic state pension and, therefore, the lower earnings limit, would today be £97 per week for a single pensioner; above any of the figures about which the Government have been boasting that they are to lift people's income to through means testing.

People wanted more. People would retain their dignity. I am appalled at the lack of understanding in this House about the importance to poor people of their dignity. It is all the more important if you do not have much of anything else. Means testing, as anyone's postbag shows, shocks most pensioners--or a large number of them--because it humiliates them. I received a letter--I meant to bring it with me, but there you are; you are spared it. One chappie wrote to me with the details of what he had to claim to, or admit to. He said, "My advice to anyone thinking of claiming income support is: don't". It was only a few days ago that I received that letter. I do not say that I endorse that advice; I want people to get as much money as they can to meet their needs.

But look at the picture; look at the mess that we are getting ourselves into. The Government have spent two years on nine pilot schemes trying to find out why people are not claiming. They tell us--the Minister said so to me in debates on the last Bill--"We discovered that large numbers of them are too well off, yet they are people who claim to be entitled to it". But that has not stopped the Government from announcing that they are to spend £15 million, starting next month, to make sure that everyone who is entitled to the minimum income guarantee claims it. They are going to have television shows, television call-ins and heaven knows what, with advertisements, costing £15 million, almost--that is nothing, is it?--to try to persuade people to take a minimum income guarantee. I wonder whether we will be told at the end of that exercise that, "Oh, the trouble is that most of them are earning too much".

We are not being honest with ourselves. We are not being intellectually worthy of our responsibilities. When I set out with my colleagues and a wonderful band of special advisers to work out an improvement to the pensions scheme, way back in 1974, we were not airy-fairy scheme drawers-up--pie-in-the-sky; never mind who pays. I have not been a member of eight Cabinets and eight public expenditure exercise agonies

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not to know that you must balance your books and that you cannot ask people to pay taxes or contributions that are unreasonable. But we did try to be honest and open.

I was shocked when I read in Commons Hansard the other day on, I believe, 6th April the Answer given by the Chancellor of the Exchequer to a Question about the restoration of the earnings link. He said, "But pensioners will be getting £800 million more by the end of this Parliament than they would have done even if we had recreated the earnings link".

I wanted to get those figures analysed. I succeeded to a certain extent, with the help of our excellent Library. What did I find? I found that a large amount of that £800 million consists of the increased fuel allowances that were welcomed by all of us. No doubt, when the new free TV licences come in for the over-75s in the autumn, they will count as well.

But the Government have claimed that those fuel payments are to go to every elderly person irrespective of income in recognition of the fact that they are old and need to keep warm. You do not start niggling about whether they are entitled to that or say that if they had saved a bit more they would not be entitled to it. That is what we are doing: we are penalising the thrifty by this extension of means testing.

What struck me was that the Chancellor of the Exchequer said that this payment, which is due to everybody, is, in fact, to be financed from the denial of the restoration of the earnings link. So all these people who rely on their basic pension, including some of the million-odd people who the Government say are not claiming means-tested support, are the people who are denied the earnings link and, therefore, are paying, in effect, for the fuel concession to all pensioners.

Why should it be wrong to give the earnings link to pensioners because they will get a fuel allowance, when it is not wrong, in the Government's estimation, to pay that same fuel allowance to everyone irrespective of income? They have not thought it through. They have not seen it as an integrated whole.

I must not keep the House any longer, but as Lady Turner has said, there will be opportunities at the Committee stage to probe these figures to their very depths in order to try to persuade the Government at least to be logical.

There is a whole area of SERPS provision that this Government have never understood. Take the carers; you would think that they had just thought up the problems of the carers. It was my government who introduced the invalid care allowance, but more importantly--they never mention this--an integral part of the SERPS pension was the 20 best earning years. The maturity rate was 20 years. You paid all the time you were earning, but the pension could mature in 20 years. In assessing entitlement to pension you could claim to base that pension on your 20 best earning years. Think how civilised that is.

I remember talking to a leading member of the Carers National Association just before the Government's Bill was introduced and I told her about this. She said, "That would be fine; that would meet

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most of our needs". Carers are not born in the cradle; they take up caring at a certain point in their lives. The same is true for disabled people.

I end with this: in the discussions in the Commons, our good friends the Liberals, and Labour Members, made some very good points. One sentence stands out: Angela Eagle, whom I believe is a junior Minister in the DSS, said, "The worst thing that happened for women in the labour market was the abolition of the 20 best earning years". So let us be really civilised, really honest and really logical, as we shall try to persuade the House to be when we come to the Committee stage.

5.15 p.m.

The Lord Bishop of Lincoln: My Lords, I wish to comment on Clauses 61 to 66 of the Bill. They concern the loss of benefit for breach of a community order. I join with the noble Lord, Lord Windlesham, in objecting to them in principle and also in the belief that the measures will be counter-productive in practice.

The proposals unfairly penalise the poorest and in many cases, the most socially-excluded people in our society. Many studies have shown a strong correlation between poverty and crime. Pushing poor people into even greater poverty must increase their temptation to steal, burgle, solicit or sell drugs. A reduction in non-housing benefit income will directly affect some offenders' ability to maintain their accommodation, which in itself increases the likelihood of re-offending.

Coupled with the proposals in Clause 46 of the Criminal Justice and Court Services Bill, to gaol offenders who are in breach of a community sentence, the clauses will, if agreed, inevitably lead to a rise in the prison population and threaten further the ability of the Prison Service to improve the education and the possibility of rehabilitation of prisoners. All that seems to conflict directly with the Government's stated intention of bringing down crime rates.

In addition to those practical concerns, I believe that there are also moral objections to the proposals. As employment statistics show, people from ethnic minorities are more likely than white people to be unemployed. These proposals could therefore constitute indirect discrimination against black people, as defined in the Macpherson report.

An even more serious objection, as mentioned by the noble Lord, Lord Windlesham, is that the measures amount to double punishment. The courts will retain all their current powers to impose penalties for breaches of orders, ranging from fines to imprisonment, and the withdrawal of benefits will be additional to whatever penalty the court imposes. Moreover, that double punishment will apply only to the poorest offenders because it will not affect offenders who are in work. Inevitably, it will also affect other innocent family members, including young children, through its impact on the total family income. As such, surely it raises a moral question of how society deals with offenders and their families.

It is wholly wrong that benefit will be reduced before a court has found that the alleged breach of the order is proven. It is like fining everyone who is

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accused of a criminal offence before they go to court, saying, "Do not worry, we shall pay you back if we find you not guilty".

I know that the Under-Secretary of State in another place argued in Committee that that measure is an extension of so-called benefit conditionality and not a punishment. However, the requirement that benefit claimants should be willing to co-operate with attempts to find employment is directly related to their need for benefit. If they were in employment, they would either not need benefit or would need benefits at a lower level. There is no direct relationship between breach of a community sentence and the need for benefits to be paid to an individual who has no income. For this reason, whatever is said, the reduction or withdrawal of benefit has a gratuitous element that gives it all the hallmarks of an additional punishment.

Benefits are, understandably, set at subsistence level. Many probation officers working with offenders would not find it acceptable morally to push them and their families into further debt and destitution. In making the probation officer responsible for sending the appropriate certificate to the benefits office, the legislation undermines and destroys any trust that has been built up between the probation officer and the offender. I should like to remind the House that trust is all-important if effective care and rehabilitation is to take place. I hope that the Government will think again about these clauses. I hope also that I shall be in a position to oppose them in Committee.

5.21 p.m.

Baroness Crawley: My Lords, I welcome this Bill as a further stage in the Government's responsibility to ensure that our welfare system reflects the contemporary needs of our most vulnerable citizens and delivers for them. Despite this being a three-in-one Bill with added extras, amusingly described as a "finger buffet" by the noble Lord, Lord Rix, there is a theme running through it. It is that the welfare system should impact far more fairly and effectively on those with whom it is engaged so that the benefits that they have a right to, or the outcomes of the responsibilities they undertake, as with community service, are fairer, more transparent and more immediate.

The Bill's measure of success will be if, following the proposed reform of child support, children actually receive the money and practical support to which they are entitled and receive it more speedily with far less bureaucratic obstacles than is currently the case. The Bill will also succeed if the second state pension actually does what it proposes and transfers greater resources to low earners, many of whom, as several speakers have said, are women, and to the long-term disabled--all with broken work records.

The third major part of the Bill, in the words of the gracious Speech last November, will,

    "reinforce people's obligations to society by linking benefit entitlement to compliance with community sentences".--[Official Report, 17/11/99; col. 3.]

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This proper aspiration will also only succeed if its reinforcement of community sentences is carried out in a way that targets the offender without spreading the consequences of that sanction to those close to the offender who may be innocent of any wrongdoing.

Several noble Lords who are speaking today made extremely valuable contributions a few weeks ago in the debate I had the opportunity to initiate on child poverty. The whole purpose of the child support section of this Bill is to use the reform of the CSA as a vehicle towards ending the scandal of child poverty. It is not just a case of me, a Labour Back-Bencher, saying that: a number of organisations have written to noble Lords. The Children's Society says that, as a national organisation serving the needs of children and young people, it welcomes the proposed reforms and the child-centred spirit in which they are made.

As we know, the CSA was established to reinforce the financial responsibility of both parents to their children, whether they live together or apart. However, in many cases that has not happened. Honourable Members in another place have bursting postbags and acrimonious surgeries as evidence of the need for CSA reform. The noble Lord, Lord Higgins, made reference to the acrimony that arises under the current system.

Under the present system, CSA staff spend 90 per cent of their time doing the assessment calculations and only 10 per cent of their time chasing payments. Only 40 per cent of assessments made are paid in full; and only 66 per cent of maintenance due is actually paid. That is an awful lot of children in need, given that the CSA is currently handling more than 998,000 families. As my noble friend the Minister said, it is expected that more than 1 million children will benefit from the Bill's proposals, many of them receiving maintenance for the first time. That has to be a major step forward in combating child poverty.

This long overdue reform of the CSA will provide a far simpler system of rates. Levels of liability will reflect a simple percentage of the non-resident parent's net income; families on income support or income-based jobseeker's allowance will be able to keep up to £10 a week of maintenance paid to their children; there will be a tougher sanctions regime so that non-resident parents cannot escape their responsibilities and will be fined for non-co-operation with the CSA; and the new CSA will be far more focused on delivering a service to clients, thereby building up a far better culture of assistance and accessibility.

The second major section of the Bill upon which I should like to spend a few moments is that relating to the state second pension. As chair of the Women's National Commission, I particularly welcome the fact that those who will gain from the state second pension--the 14.5 million low and moderate earners--will include millions of women. These are women with broken work records, as my noble friend Lady Turner pointed out, and women carers. The Bill should help approximately 2 million carers, as my noble friend Lady Pitkeathley, so graphically outlined, the vast majority of whom are women.

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If women are earning between the national insurance lower earnings limit of £3,432 and the new low earnings threshold of £9,500, we understand that, under the Bill, they will get pension credits as if they were earning £9,500. That will surely go a long way towards pulling down the hard architecture of poverty in old age, which, as we know, is built up over a lifetime by so many women's low and erratic pay patterns.

If things had been left as they were in 1997, more than two-thirds of women workers earning less than £10,000 a year would have no second pension provision whatever. If nothing were done, very many women would end up as part of the one-third of people in this country who could be left to retire on means-tested benefits alone in the year 2050.

I believe that this Bill will make a substantial difference in improving the lives of vulnerable children in its reform of the CSA and in opening up far better pension prospects for low and moderate earners, especially women. I therefore welcome it as another route out of poverty.

5.28 p.m.

Baroness Fookes: My Lords, as the noble Baroness, Lady Crawley, reminded us, the noble Lord, Lord Rix, described the Bill as a "finger buffet". I do not look at it as a "finger buffet" at all. To me, it is very much more of a rather vulgar club sandwich, with several disparate layers and far too thick to enable one to take a civilised bite out of it. But, seriously, it shows a disturbing trend that we have seen not only with this Bill but also with others that the Government have brought forward--no doubt they will continue to do so--namely, putting several Bills into one so that we are forced to consider in the time for one Bill what should have been spread out for consideration in three. In other words, we are getting far more legislation even than one might have supposed from one's calculations. I do not believe that this is the right trend; we want less and better legislation rather than the quantity that we are now getting.

Having made that protest, I now make several points on the Bill. Like the noble Baroness, Lady Castle, I confess that I have not read all the clauses and schedules. However, I have read sufficient to give me concern over certain aspects. I am delighted to note that the Child Support Agency system of payments will be simplified. As a former MP, I saw all too often in my surgeries unhappy women trying to cope with a court system which appeared to be far too difficult for them to manage and which resulted only in court orders that were broken. They then faced the miserable prospect of returning to court, of endless delays and of no satisfaction.

I believed--and still do--that the principle of the Child Support Agency was a fine one. However, the system was far too elaborate and far too complicated. It caused endless resentment among the fathers who defaulted on their payments. It also caused endless problems for the employees of the Child Support Agency. A regional office of the Child Support Agency was located close to my former constituency in

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Plymouth. Some of the young women employees at that office were targeted by angry fathers who took photographs of them and recorded their car registration numbers. That was a frightening experience for people who were trying to operate a system that was far too complicated and to carry out a task that was not of their making. I hope that the new system will make their lives easier. No one has mentioned them in the debate today. It is important that we place on record our recognition of the contribution that they have made and of the difficulties that they have experienced. We thank them for what they have achieved and we hope that their lives will be easier in the future.

I turn now to pensions. I am glad to note that the noble Baroness, Lady Strange, is present as she referred to war widows. I fully share her views on that matter and I look forward to working in partnership with her at later stages of the Bill, when we hope to bring forward a suitable amendment on that issue. I believe that it is important to place that on the record now.

I was not, of course, surprised, but disappointed, as always, to discover that one matter had been left out of the Bill altogether. The noble Baroness will not be surprised to hear that I refer to the frozen pensions of expatriates who live abroad. Their pensions are frozen when they leave the country. I know what the noble Baroness's reply will comprise as she gave me a frank reply recently; namely, that the cost of meeting the provision I seek would be too high and that there are better ways of spending that money. However, that remark has caused great offence to the pensioner associations with which I am in contact. The House will understand that those bodies see this provision in terms of an obligation which has not been fulfilled and not in terms of some kind of optional decision on the best way to spend money. I hope to return to that also on another occasion.

I turn to the matter of reducing the benefit of those who breach community service or probation orders. I shall not discuss this in great detail as no one could have given a more masterly exposition of it than my noble friend Lord Windlesham. I agreed with him when he said that this issue was objectionable in principle and probably unworkable in practice. No one has mentioned the people in bail or probation hostels who have to make some payment for their accommodation. Presumably, if they breach an order and their benefit is reduced, they will then be unable to pay for their accommodation. I believe that that is wholly impracticable.

I urge the Government to reconsider the difficulties that arose when the Child Support Agency was set up with far too detailed a system. I fear that the Government will go down the same road with the measure I have just mentioned. If nothing else, I believe that such a measure could involve clear breaches of the Convention on Human Rights. I have received one or two submissions from lawyers who have suggested that the measure could be in clear breach of certain articles, notably that concerning fair trial.

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Noble Lords have already said that it is unusual, to say the least, to impose a fine or punishment without having first secured a conviction in court. I believe that it would be possible to challenge the measure on that basis alone, although I do not speak as a trained lawyer. I also believe that the measure could be regarded as discriminatory in so far as those in work who breach an order would not be subject to such a penalty as they do not receive benefits but those who are in receipt of benefits would face that additional hazard. I believe that the measure will lead to problems in that regard. I urge Her Majesty's Government to think again about that measure and seriously to consider withdrawing it altogether, or at least to make it available to the courts as a sanction if they see fit to impose it, rather than to introduce it as a compulsory, non-discretionary element.

Noble Lords will understand my muted feelings on the Bill. I am disappointed by certain aspects of it. However, I hope that in Committee and at subsequent stages we shall make some improvements to it.

5.37 p.m.

Lord Davies of Coity: My Lords, as we all know, and have been reminded in the debate, this is a lengthy and comprehensive Bill. It embraces child support, pensions and social security--all matters of fundamental importance to nearly everyone. It is a Bill which reflects the enormous changes that have taken place in our society. It addresses not only the problems that face us now but also anticipates the problems of the future if nothing is done now. It is a Bill which I am sure we can all generally support in principle, even if there are differences as regards the means by which the fundamental objectives of the Bill are achieved.

The eradication of child poverty and the building of the foundation for security in retirement are undoubtedly aims with which no one can quarrel. These aims are precisely what this Bill seeks to achieve. The Bill will help to ensure that pensioners have a life to look forward to. It is also designed to provide more support and greater opportunities for children. The Bill sets out clear responsibilities for working adults, as well as promoting rights for them.

In addition to reforming the system of child support, introducing the state second pension and introducing disciplines in respect of community sentences and benefit entitlement, the Bill also addresses occupational and personal pensions; the powers of fraud inspectors; housing benefit overpayments; national insurance contributions on benefits in kind; and war pensions--all issues which need legislative attention.

Times have changed and circumstances have changed. If our welfare state is to mean anything in the 21st century, it must also change. I compliment the Government on their vision and courage on embarking upon this programme of change which is not only desirable but also necessary.

However, I intend to concentrate on the child support aspect of the Bill. Children are the ones least able to speak for themselves, but they are the ones who

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will inherit the future and they are the ones who will determine what that future will be like. Therefore, apart from our moral obligation to do all that we can to support and to protect our children, we must also do so if we want the future to get better and not worse.

We know of all the problems that have arisen for children born outside marriage--particularly those from teenage pregnancies--and of the enormous increase in one-parent families. In the main, this has meant a considerable struggle for the sole parent bringing up the child or the children, the overwhelming and vast majority of whom we know are women.

In an effort to get the absent parent to accept responsibility for the child or children he has fathered, the previous Government introduced the Child Support Agency. We do not quarrel with that concept, but we must recognise that it has not been working. The current system is complex and complicated. Some 90 per cent of the time of staff is spent on doing sums and 10 per cent on chasing payments; only 40 per cent of assessments made are paid in full; and only 66 per cent of maintenance due is paid. This cannot be right.

That is why the Government are proposing to simplify the system under which the Child Support Agency works. Through this Bill, an absent parent--described as a "non-resident" parent--will pay a percentage of his net income to support the child or children he has fathered. The Bill also provides for reduced rates for those on low incomes and more help for the poorest of parents. Through these provisions it is expected that more than 1 million children will benefit from the new system, with many of them getting maintenance for the very first time. These must be measures that we can all support. Children have a right to care and parents have a responsibility to provide it. If a father does not voluntarily fulfil that responsibility, then in the interests of the child the state must impose it.

When I was a young man--I am sure that most of your Lordships' House will remember this--if a lad got a young girl "into trouble" or "in the family way", as I recall the circumstances were described, fulfilling his responsibility by getting married was done without a second thought. Although that may no longer be the case, a father must accept responsibility for the child he has fathered; hence the reason for the establishment of the Child Support Agency. Whatever sympathy we may have for parents, absent or otherwise--as indeed expressed by the noble Earl, Lord Russell--let us not forget that our duty is to the child and to the children; the child must come first. Child poverty must be removed; bureaucracy dramatically reduced; and maintenance paid and provided more quickly.

This is what this Bill is about--and the quicker it becomes law the better. My only regret is that it appears that, because of legislative and operational timetables, the introduction of these provisions will not take place until the end of 2001. So the quicker we deal with the Bill the sooner children will benefit.

In conclusion, I should like to share with the House a recent experience that I am so pleased to have had. Last Friday afternoon my wife and I were invited to

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the primary school in our village which four of our grandchildren attend. We were invited as grandparents. Two classes of six year-olds, one of which our granddaughter attends, were putting on a performance for their grandparents, singing and individually expressing their feelings and love for their grandparents. We were provided with tea and cakes. It was a wonderful afternoon. In these two classes--this is the point--there were fewer than 60 children, but what was so wonderful is that there were nearly 200 grandparents there. I am sure that the House can imagine the amount of emotion generated.

I know that these children are having a wonderful start in life--in their school, in their homes and in the community in which we all live. I wish that every child could have such opportunities. I believe that this Bill, along with other programmes and measures being brought forward by this Government, will do a great deal more and provide greater opportunities for all the nation's children in the future.

5.44 p.m.

Baroness Howells of St Davids: My Lords, in speaking to this Bill, I confess to a certain crisis of identity. I share most of the views of the noble Earl, Lord Russell, on the CSA as an organisation; however, I welcome the proposed reforms envisaged in the Bill, especially the child-centred spirit in which they have been suggested.

The introduction of the child premium, not in the Bill itself but in the White Paper on children's rights and parents' responsibilities, must be seen as both a vital and a tangible expression of the Government's commitment to putting children at the centre of all child support reforms and to abolishing child poverty. The Government's introduction of a simple formula for calculating child maintenance is certainly to be welcomed.

However, the Government's claim that they are giving more help to the poorest parent falls short when they speak of tougher sanctions against those who do not comply--for example, by making withholding information a criminal offence, with fines of up to £1,000 and a late payment penalty. In itself, it seems only right and proper that those who do not comply should be penalised. But I should like the Minister to pause for a moment to consider what the reasons may be for those who may fail to comply--for example, those who have been raped; those who have had accidents which have resulted not from a stable relationship but from other forms of unsociable behaviour; those children who have children themselves; those 13 to 15 year-olds who have been raped by fathers, stepfathers or older relatives who may themselves be drug addicts. No one would suggest that such persons should be protected, but, life being what it is, these young mothers have to bear a cross in silence, often to protect those whom they love, who are their nearest and dearest and who could be hurt beyond repair. To penalise them in this way may impose greater poverty.

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I believe that the Government are truly trying to eradicate poverty, but we have only to read the papers to see what can happen in some cases when vulnerable children with children are forced to name the father of their child. I have known of cases where the stepfather has been gaoled for six months--rightly so, I am sure your Lordships will agree--but the young mother is made to feel so guilty that her life and that of her child become untenable. I shall not bore your Lordships by speaking of cases where these young mothers have been forced either to give up their children or to flee with their children to places of safety--not from the man responsible for the pregnancy but often from their own mothers, aunts or cousins, whose loved ones, in their eyes, have been put in gaol because of this unsociable behaviour. I urge the Government to put in train a safety net for those unfortunate children before seeking sanctions as the only way forward.

Several surveys have shown that many lone parents are surviving at the edge of a basic existence. Family and community support systems are fragile. Despite these difficulties, lone parents have the desire to change and return to work.

We must, as a Government and people with responsibility, provide conducive circumstances and, more importantly, affordable childcare which has the flexibility to enable those lone parents to return to work, to know that their children are looked after and not to be dependent on state aid.

The penalty proposed will not only delay the return to work but may lead to child neglect among the most vulnerable in our society. Sometimes when we make laws we forget that there are centigrade people and fahrenheit people, the same, but having very very different circumstances. I shall not take time to explain to your Lordships what I mean by centigrade and fahrenheit people because I think you will know yourselves if you think about it.

Finally, in Clause 10, on the subject of appeals, in the interests of a fair and just process I would suggest that tribunals set up for any such appeals should be headed by at least three persons, of whom one should be of the same sex and one should certainly be of the same ethnic group as the qualifying person, to make such judgments. Our different ethnic groups have very different positions in this society.

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