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2 July 2009 : Column GC95
Grand Committee
Thursday, 2 July 2009.
Welfare Reform Bill
Main Bill Page
Copy of Bill
Explanatory Notes
Amendments
7th Report from the Delegated Powers Committee
14th Report from the Joint Committee on Human Rights
9th Report from the Constitution Committee
Committee (8th Day)
2 pm
The Deputy Chairman of Committees (Baroness McIntosh of Hudnall): I remind the Committee that if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bell is heard and will resume 10 minutes thereafter.
Clause 26 : Attendance in connection with jobseeker's allowance: sanctions
158: Clause 26, page 35, line 11, at end insert-
"but only after a clear warning letter and explanation of the initial instance of failure to comply has been issued to the claimant"
Baroness Thomas of Winchester: In moving the amendment, I am well aware that the Minister has said in terms that the first sanction for jobseeker's allowance will be a warning letter. However, I have not withdrawn the amendment because it should be in the Bill.
In the chapter of his report entitled "The Role of Sanctions", Professor Gregg recommended the introduction of a system of staged sanctions for claimants who had received a written warning for the first instance of non-compliance of attending a mandatory interview or appointment. This would spell out exactly why the claimant had been sanctioned and what the financial consequences would be for further non-compliance. Under the Bill, financial sanctions could be applied immediately, without a clear written warning, after the first non-compliance.
The amendment was suggested by Citizens Advice, which regularly sees clients whose benefits have been sanctioned but who do not understand why-which of course makes the sanction less effective in changing future behaviour. As I said earlier, the Minister said that a written warning is sent, presumably when an interview or other appointment is missed, and that this warning letter constitutes the first sanction. If this is the case, why is it not enshrined in legislation to protect the vulnerable from being financially penalised for the first offence, which they may not have correctly understood? I beg to move.
Lord Skelmersdale: My view is and has always been that we are dealing with sanctions for violent conduct-in other words, punishment for behaviour that I expect all noble Lords would deplore and agree is deserving of sanctions. I hope we can get an assurance from the Minister that new Section 20C on page 28 of the Bill will offer protection from violence to all those involved
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I therefore believe that sanctions are necessary. However, they should not be-and must not be seen to be-arbitrary. A warning letter which set out details of why sanctions are being applied would be a useful way of explaining to a claimant why his own conduct is responsible for his predicament. Perhaps it will be a salutary warning.
I agree with the noble Baroness, Lady Thomas, that sanctions should not be imposed on claimants before they have had adequate warning that it is about to happen. Perhaps the best way is in the form of a letter. Other methods, such as telephone or e-mail, might also be helpful. Indeed, for people with a mental illness, we have already had the promise that sanctions will not be upheld without a face-to-face interview.
I had been planning, however, to read out an example of how not to do it in a letter-a letter from the DWP to the daughter of a deceased pensioner which was so threatening in its tone that it ended up in Parliament, in my hands. I was so horrified by it that I sent it to the Minister, who I believe forwarded it to the pension agency. Alas, I made the crucial error of sending the original to the Minister without keeping a copy for myself, so I am unable to discomfit your Lordships by reading it out. Suffice it to say that it did not arouse feelings of sympathy for the department, which was trying to reclaim the amount of state pension that had mistakenly been paid out after the pensioner's death.
Incidentally, I have yet to hear a response to it, which surprises me as I sent it to the Minister well over a month ago. I hope that when I finally get a response from the pension agency I will be able to forward it to the Minister, because I am trying to get a response to the tone of the letter from him rather than the agency which sent the letter in the first place.
The Countess of Mar: I, too, support the noble Baroness, Lady Thomas, in her amendment. We must be not only fair but seen to be fair. Sometimes the message might not get home in a telephone conversation. People are not always able to visualise what might happen, but if they have something in writing at least they can take it to someone else to explain it. I endorse what the noble Baroness says.
The Parliamentary Under-Secretary of State, Department for Communities and Local Government & Department for Work and Pensions (Lord McKenzie of Luton): I thank the noble Baroness for this amendment. It gives me the opportunity, I hope, to clarify the matter, because I think that she quoted me as saying that within the JSA regime, the starting point for sanction would be a letter. I shall deal with that point directly. However, I think that the noble Lord, Lord Skelmersdale, was reverting to the generality of the clause about the impact of these sanctions for violence. Yes, it is meant to apply not only to Jobcentre Plus
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The clause introduces a new benefit sanction for those customers who fail to attend their mandatory appointments within the jobseeker's allowance regime. Such appointments include, for example, the fortnightly job search review where customers demonstrate that they are available for and have been actively seeking work. This is applied only to those groups who are on JSA because they are deemed to be actively seeking and available for work.
The amendment proposes that JSA customers are given a warning letter and an explanation of the act of non-compliance prior to the issue of the sanction. I shall explain why this step is not appropriate for this client group. Mandatory appointments with Jobcentre Plus are a core element of the JSA regime. The appointments act as a gateway to the support on offer to help customers back to work, and they act as a crucial checkpoint in ensuring that customers are actively seeking and are available for work. The requirement to attend appointments and the consequences for failure to attend are clearly communicated to customers at the start of a claim and repeated at regular intervals throughout the course of the claim.
As customers are fully informed of this key commitment, if they still fail to attend, they could be trying to avoid their responsibility actively to seek work. There therefore needs to be a clear link between the customer's responsibilities under the JSA regime and the consequences of failing to comply. We believe that sending customers a warning letter before a sanction would only weaken this link between the responsibility to attend appointments and the right to receive benefit.
A different approach to sanctions for other client groups, notably the progression-to-work group, will apply. That is the point focused on by the noble Baroness. These groups and the progression-to-work group will, for the purposes of the pathfinders, consist of lone parents with young children claiming employment and support allowance who are not required to be actively seeking and available for work. It would therefore not be appropriate to apply this sanctions regime to those claimants.
We plan to test the effectiveness of a more progressive regime based on the principles recommended by Professor Gregg in the pathfinders. He suggested that the sanctions regime needs to be clearly understood. The noble Baroness made that point as well. We will use different ways to encourage re-engagement and will always offer speedy and simple routes to customers to end any sanctions imposed. We plan to follow that approach. Our model for the pathfinders is not yet fixed as we wish to discuss our plans in more detail with the stakeholders. However, our current plans particularly focus on the small number of people who repeatedly fail to meet the requirements that apply to them. We do this by progressively increasing the impact the greater the number of consecutive failures there are. Therefore, if a person fails to meet a work-focused
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I assure the Committee that the sanctioning regime in JSA incorporates safeguards. If customers show good cause-and we have debated that extensively-for failing to attend the appointment, a sanction will not be applied. Further, if customers are sanctioned, they will have the opportunity to claim a hardship payment, which we have talked about, if they or a partner is in a vulnerable group-for example if they have a medical condition or are responsible for a child. Customers will also be able to appeal the imposition of the sanction. I hope that that has clarified our position for the noble Baroness and that she feels able to withdraw the amendment.
Lord Skelmersdale: The Minister pointed out that sanctions already exist in the field of actively seeking work under the Jobseekers Act 1995. One can readily understand that the regime will be slightly different when applied to the Clause 2 group, the progression-to-work group. It would be extremely helpful if I and perhaps the noble Baroness, Lady Thomas, could see the pro forma letters which currently exist for the first group and what is likely to be available or used for the second group, so that we can make a judgment on this.
Lord McKenzie of Luton: I am sure we can make available the type of notifications that exist under the current sanctions regime. So far as how we are going to deal with the pathfinders and a progressive, Gregg-type regime, we want to discuss this with stakeholders. I am very happy for noble Lords to be involved in that process. We have not concluded that yet and will need to do more work before we finalise our thoughts.
Lord Skelmersdale: I am very grateful.
Baroness Thomas of Winchester: I am grateful for the support for the amendment around the Grand Committee. I am a bit confused, however. When Professor Gregg talked about the sanctions regime on page 74 of his report, under the heading "Dealing more effectively with repeat offenders", he wrote:
Is he referring to ESA? I thought that he was talking about JSA as well, but I may have got it wrong.
Lord McKenzie of Luton: I do not have the document in front of me, but I believe that that is focused on the progression-to-work group currently on income support and ESA. They may end up on JSA in due course.
Baroness Thomas of Winchester: There is a case for saying that the first sanction across all regimes should be a warning letter. That would be a good idea so that everyone knows exactly where they stand. There is
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Clause 28 : Persons under pensionable age to take part in work-focused interviews etc.
Amendments 159 to 161 not moved.
161A: After Clause 28, insert the following new Clause-
In section 123(1)(e) of the Social Security Contributions and Benefits Act 1992 (c. 4) (income-related benefits), for "council tax benefit" substitute "council tax rebate"."
2.15 pm
Baroness Turner of Camden: I am indebted to the Royal British Legion for the text of this amendment and for the accompanying briefing. I am informed that the legion has been engaged in a campaign designed to alleviate pension poverty among older veterans. That followed research it commissioned, which showed that 38 per cent of older veterans, their spouses and widowers report an income level below that required for healthy living.
Despite these low income levels, it is estimated that only 55 to 61 per cent of all pensioners who qualify for council tax benefit actually make a claim. The Department for Work and Pensions has estimated that up to £1.5 billion of CTB is left unclaimed by pensioners each year. For this reason, the legion has embarked on a campaign to rename council tax benefit and to call it a rebate. It believes that this is a simple, cost-effective and practical way of helping pensioners, many of them in the ex-service community. It believes that this will increase take up considerably, thereby lifting tens of thousands of pensioners out of poverty.
The legion has done a fair amount of research to see whether it would have that effect. It conducted a poll through ComRes as recently as May 2009 and found that 75 per cent of members of the public agree that renaming council tax benefit as a rebate might help encourage more people to make a claim for it. These words were used by the DWP in its submission
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In view of all this and the fact that there is a substantial amount of support right across the board for what is now proposed, I hope the Government will take heed of the results of the campaign and be prepared to accept the amendment-which would, I am sure, have the effect of ensuring that claims are made by a number of people who at the moment apparently are too proud to claim benefit. That is very true of many veterans, but of course it is true of many pensioners as well. They do not like to be "shamed", as they see it, into claiming for benefits. That may strike some of us as rather odd, but it is how they feel about it. I think that we should respond to that. If we change the name to rebate, there will not be the feeling of shame in making an application and more people will apply for what is their entitlement. I beg to move.
Lord Skelmersdale: I am grateful to the noble Baroness, Lady Turner, and I support her in this endeavour-rare though that might seem to some of your Lordships. To be strictly accurate, my right honourable friend the Leader of the Opposition has done rather more than support this amendment; what he did was to write to the director-general of the British Legion with the explicit promise that should the current Government fail to implement this change, a future Government will.
The important facts here are that less than 60 per cent of those who are eligible for council tax benefit actually make a claim, as the noble Baroness said. One reason for that is the stigma associated with being in receipt of benefit. The Minister will remember that in a recent Bill that emanated from the DWP, we talked an awful lot about stigma, in that case relating to disabled people-in particular with cancer, but other elements as well. We can all agree that in certain parts of this country a stigma is associated with being in receipt of benefits. Although some may tut-tut that that is so, the Government know as well as anyone that it is a real consideration for people, not least because a report by the Office of the Deputy Prime Minister Select Committee in 2004 said that the stigma attached to council tax benefit being presented as a benefit rather than as, more accurately, a relief from tax contributed accounted for the dismal rate of take-up for council tax benefit. All the evidence is there. The aim behind the amendment is so strikingly simple that I cannot believe that even on an off-day the Minister could resist it-and I hope that today is not an off-day.
Baroness Thomas of Winchester: I offer very warm support from these Benches for this proposal, moved so ably by the noble Baroness, Lady Turner. I can confirm that should there be a Liberal Democrat Government after the next election, we would also bring it in. My right honourable friend in another
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Council tax benefit has the lowest take-up of any of the means-tested benefits. Some 1.7 million pensioners, including many ex-servicemen and women, do not claim it, as we have heard, because they are simply not prepared to claim a benefit. Research has clearly shown that rebranding council tax benefit as a rebate would increase the rate of take-up, and it would be a very practical change to help to lift a large number of older people out of poverty. We warmly support the proposal from these Benches and hope that the Government will accept the amendment.
The Countess of Mar: I, too, give the amendment my warm support. Most of these people will not be in the income tax bracket, but we have no hesitation about claiming income tax rebates. If it was an income tax benefit, we might think a bit differently. It is a tax and it should be called a rebate.
Lord McKenzie of Luton: I congratulate my noble friend Lady Turner on moving this amendment. She may have come close to unifying the Committee on an issue, which is perhaps a first during the course of our deliberations so far.
The aim of the amendment is to improve take-up of council tax benefit, particularly among pensioners, by changing its name. As my noble friend and others have done, I recognise the role that the Royal British Legion has played in highlighting this issue. My noble friend Lord Morris of Manchester has put his name to the amendment; he is unable to be here today, but he has a role as honorary parliamentary adviser to the legion and gives it his clear support. I am delighted that it has the support of the noble Lord, Lord Skelmersdale, and his leader in the other place; the noble Baroness, Lady Thomas, and the noble Countess, Lady Mar.
It is very important that pensioners should claim the benefits to which they are entitled if we are to achieve our aim of reducing pensioner poverty. People should not be deterred from doing so by factors such as an off-putting name. Having said this, the Government are sympathetic to changing the name of council tax benefit to one that better describes its true nature. We recognise that it is something that has widespread support and has the potential to make a difference in helping people to claim it. The latest data that I have for council tax benefit take-up, for 2007-08, show take-up among pensioners of between 53 per cent and 60 per cent. The potential amount unclaimed is between £1.2 billion and £1.7 billion, so it is a lot of money that could make a real difference to the lives of many pensioners.
Sir Michael Lyons pointed out that council tax benefit effectively operates as a rebate and renaming it as such would do no more than reflect that fact. Even though council tax benefit already helps more than 5 million families, I should like to see the percentage of people who take up their entitlement rising and I am
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Even so, there are clearly problems with take-up of the benefit. The most recent figures for 2007-08 show that around 62 per cent to 68 per cent of all those whom we believe to be entitled to claim council tax benefit actually do so-the percentage for pensioners is smaller. Although one might draw some comfort from the fact that the percentages for take-up have been relatively stable for several years, the latest figures show a 1 per cent drop. This is extremely disappointing, even more so because we have done, and continue to do, a number of things to try to boost take-up.
We accept that we must do more to remedy the situation and have been impressed with the case made by the Royal British Legion, as part of its Return to Rationing? campaign, that the name "council tax benefit" is an obstacle to claiming. In recent weeks, the department has liaised with the Royal British Legion over what can be done in the short term in partnership with local authorities to help them re-market council tax benefit as part of their work to promote benefit take-up.
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