Welfare Reform Bill (HL Bill 75)

(a) in the heading, for “penalty or caution” there is substituted “or
penalty”;

(b) in subsection (1), after paragraph (a) there is inserted “or”;

(c) subsection (1)(c) (cautions) is repealed;

(d) 5in subsection (13), in the definition of “disqualifying event”, after
“(1)(a)” there is inserted “or”.

(2) In section 36A of the Tax Credits Act 2002 (loss of tax working tax credit in case
of conviction, penalty or caution for benefit offence) subsection (1)(c) (cautions)
is repealed.

10Administration of tax credits

119 Tax credit fraud: investigation

In section 109A of the Social Security Administration Act 1992 (authorisations
for investigators), at the end there is inserted—

“(9) This section and sections 109B to 109C below apply as if—

(a) 15the Tax Credits Act 2002 were relevant social security
legislation, and

(b) accordingly, child tax credit and working tax credit were
relevant social security benefits for the purposes of the
definition of “benefit offence”.”

120 20Information-sharing for prevention etc of tax credit fraud

(1) Section 122B of the Social Security Administration Act 1992 (supply of
government information for fraud prevention etc) is amended as follows.

(2) In subsection (2)(a), after “social security” there is inserted “or tax credits”.

(3) In subsection (3)—

(a) 25in paragraph (b), after “1995” there is inserted “, the Tax Credits Act
2002”,

(b) in that paragraph, the final “or” is repealed, and

(c) after paragraph (c) there is inserted “or

“(d) it is supplied under section 124 of the Welfare Reform
30Act 2011.”

121 Tax credit fraud: prosecution and penalties

In section 35 of the Tax Credits Act 2002 (offence of fraud), for subsection (2)
there is substituted—

“(2) Where a person is alleged to have committed an offence under this
35section in relation to payments of a tax credit not exceeding £20,000, the
offence is triable summarily only.

(3) A person who commits an offence under this section is liable on
summary conviction pursuant to subsection (2) to imprisonment for a
term not exceeding the applicable term, or a fine not exceeding level 5
40on the standard scale, or both.

(4) In subsection (3) the applicable term is—

(a) for conviction in England and Wales, 51 weeks;

(b) for conviction in Scotland or Northern Ireland, 6 months.

(5) Where a person is alleged to have committed an offence under this
section in any other case, the offence is triable either on indictment or
5summarily.

(6) A person who commits an offence under this section is liable—

(a) on summary conviction pursuant to subsection (5), to
imprisonment for a term not exceeding the applicable term, or
a fine not exceeding the statutory maximum, or both;

(b) 10on conviction on indictment pursuant to subsection (5) to
imprisonment for a term not exceeding 7 years, or a fine, or
both.

(7) In subsection (6)(a) the applicable term is—

(a) for conviction in England and Wales or Scotland, 12 months;

(b) 15for conviction in Northern Ireland, 6 months.

(8) In relation to an offence under this section committed in England and
Wales before the commencement of section 281(5) of the Criminal
Justice Act 2003, the reference in subsection (4)(a) to 51 weeks is to be
read as a reference to 6 months.

(9) 20In relation to an offence under this section committed in England and
Wales before the commencement of section 154(1) of the Criminal
Justice Act 2003, the reference in subsection (7)(a) to 12 months is to be
read as a reference to 6 months.

(10) In England and Wales—

(a) 25subsection (1) of section 116 of the Social Security
Administration Act 1992 (legal proceedings) applies in relation
to proceedings for an offence under this section;

(b) subsections (2)(a) and (3)(a) of that section apply in relation to
proceedings for an offence under this section which is triable
30summarily only pursuant to subsection (2) above.

(11) In Scotland, subsection (7)(a) and (b) of section 116 of the Social Security
Administration Act 1992 (legal proceedings) apply in relation to
proceedings for an offence under this section which is triable
summarily only pursuant to subsection (2) above.

(12) 35In Northern Ireland—

(a) subsection (1) of section 110 of the Social Security
Administration (Northern Ireland) Act 1992 (legal proceedings)
applies in relation to proceedings for an offence under this
section;

(b) 40subsections (2)(a) and (3)(a) of that section apply in relation to
proceedings for an offence under this section which is triable
summarily only pursuant to subsection (2) above.”

122 Unauthorised disclosure of information relating to tax credit offences

In Schedule 4 to the Social Security Administration Act 1992 (persons
45employed in social security administration or adjudication), in paragraph 1 of

Part 2, after “security,” there is inserted “to the investigation or prosecution of
offences relating to tax credits,”.

123 Tax credits: transfer of functions etc

(1) Her Majesty may by Order in Council—

(a) 5transfer to the Secretary of State any tax credit function of the Treasury
or the Commissioners;

(b) direct that any tax credit function of the Treasury or the Commissioners
is to be exercisable concurrently with the Secretary of State or is to cease
to be so exercisable.

(2) 10Provision within subsection (1) may be limited so as to apply only in relation
to cases within a specified description.

(3) Her Majesty may by Order in Council, as Her Majesty considers appropriate—

(a) make provision in connection with a transfer or direction under
subsection (1);

(b) 15make other provision within one or more of the following sub-
paragraphs—

(i) provision applying (with or without modifications) in relation
to tax credits any provision of primary or secondary legislation
relating to social security;

(ii) 20provision combining or linking any aspect of the payment and
management of tax credits with any aspect of the
administration of social security;

(iii) provision about the use or supply of information held for
purposes connected with tax credits, including (in particular)
25provision authorising or requiring its use or supply for other
purposes;

(iv) in relation to information held for purposes not connected with
tax credits, provision authorising or requiring its use or supply
for purposes connected with tax credits.

(4) 30An Order may make provision under subsection (3)(b) only if—

(a) the Order also makes provision under subsection (1), or

(b) a previous Order has made provision under subsection (1).

(5) Provision within subsection (3)—

(a) may confer functions on, or remove functions from, the Secretary of
35State, the Treasury, the Commissioners, a Northern Ireland department
or any other person;

(b) may (in particular) authorise the Secretary of State and the
Commissioners to enter into arrangements from time to time under
which the Commissioners are to provide services to the Secretary of
40State in connection with tax credits.

(6) Provision within subsection (3)—

(a) may expand the scope of the conduct which constitutes an offence
under any primary or secondary legislation, but may not increase the
scope of any punishment for which a person may be liable on
45conviction for the offence;

(b) may expand the scope of the conduct in respect of which a civil penalty
may be imposed under any primary or secondary legislation, but may
not increase the maximum amount of the penalty.

(7) An Order under this section may include such consequential, supplementary,
5incidental or transitional provision as Her Majesty considers appropriate
including (for example)—

(a) provision for transferring or apportioning property, rights or liabilities
(whether or not they would otherwise be capable of being transferred
or apportioned);

(b) 10provision for substituting any person for any other person in any
instrument or other document or in any legal proceedings;

(c) provision with respect to the application in relation to the Crown of
provision made by the Order.

(8) A certificate issued by the Secretary of State that any property, rights or
15liabilities set out in the certificate have been transferred or apportioned by an
Order under this section as set out in the certificate is conclusive evidence of
the matters so set out.

(9) An Order under this section may amend, repeal or revoke any primary or
secondary legislation.

(10) 20A statutory instrument containing an Order under this section is subject to
annulment in pursuance of a resolution of either House of Parliament.

(11) In this section references to tax credits are to child tax credit or working tax
credit or both.

(12) In this section references to primary or secondary legislation are to such
25legislation whenever passed or made.

(13) In this section—

• “the Commissioners” means the Commissioners for Her Majesty’s
  Revenue and Customs;

• “primary legislation” means an Act (including this Act) or Northern
  30Ireland legislation;

• “secondary legislation” means an instrument made under primary
  legislation (including an Order under this section);

• “tax credit functions” means functions so far as relating to tax credits
  conferred by or under any primary or secondary legislation.

(14) 35In section 5A(3) of the Ministers of the Crown Act 1975 for “section 5(1)” there
is substituted “section 5(1)(a) or (b)”.

Information-sharing

124 Information-sharing between Secretary of State and HMRC

(1) This subsection applies to information which is held for the purposes of any
40HMRC functions—

(a) by the Commissioners for Her Majesty’s Revenue and Customs, or

(b) by a person providing services to them.

(2) Information to which subsection (1) applies may be supplied—

(a) to the Secretary of State, or to a person providing services to the
Secretary of State, or

(b) to a Northern Ireland Department, or to a person providing services to
a Northern Ireland Department,

5for use for the purposes of departmental functions.

(3) This subsection applies to information which is held for the purposes of any
departmental functions—

(a) by the Secretary of State, or by a person providing services to the
Secretary of State, or

(b) 10by a Northern Ireland Department, or by a person providing services to
a Northern Ireland Department.

(4) Information to which subsection (3) applies may be supplied—

(a) to the Commissioners for Her Majesty’s Revenue and Customs, or

(b) to a person providing services to them,

15for use for the purposes of HMRC functions.

(5) Information supplied under this section must not be supplied by the recipient
of the information to any other person or body without—

(a) the authority of the Commissioners for Her Majesty’s Revenue and
Customs, in the case of information supplied under subsection (2);

(b) 20the authority of the Secretary of State, in the case of information held as
mentioned in subsection (3)(a) and supplied under subsection (4);

(c) the authority of the relevant Northern Ireland Department, in the case
of information held as mentioned in subsection (3)(b) and supplied
under subsection (4).

(6) 25Where information supplied under this section has been used for the purposes
for which it was supplied, it is lawful for it to be used for any purposes for
which information held for those purposes could be used.

(7) In this section—

• “departmental functions” means functions relating to—

  (a)

  30social security,

  (b)

  employment or training, or

  (c)

  the investigation or prosecution of offences relating to tax
  credits;

• “HMRC function” means any function—

  (a)

  35for which the Commissioners for Her Majesty’s Revenue and
  Customs are responsible by virtue of section 5 of the
  Commissioners for Revenue and Customs Act 2005, or

  (b)

  which relates to a matter listed in Schedule 1 to that Act;

• “Northern Ireland Department” means any of the following—

  (a)

  40the Department for Social Development;

  (b)

  the Department of Finance and Personnel;

  (c)

  the Department for Employment and Learning.

(8) For the purposes of this section any reference to functions relating to social
security includes a reference to functions relating to—

(a) 45statutory payments as defined in section 4C(11) of the Social Security
Contributions and Benefits Act 1992;

(b) maternity allowance under section 35 of that Act;

(c) statutory payments as defined in section 4C(11) of the Social Security
Contributions and Benefits (Northern Ireland) Act 1992;

(d) maternity allowance under section 35 of that Act.

(9) This section does not limit the circumstances in which information may be
5supplied apart from this section.

(10) In section 3 of the Social Security Act 1998 (use of information), in subsection
(1A) after paragraph (d) there is inserted—

“(e) the investigation or prosecution of offences relating to tax
credits.”

125 10Information-sharing in relation to provision of overnight care etc

(1) This section applies where a local authority holds information falling within
subsection (2) in relation to a person who is receiving or is likely to receive a
relevant service.

(2) The information referred to in subsection (1) is—

(a) 15information as to the fact of the provision or likely provision of the
service;

(b) information about when the provision of the service begins or ends or
is likely to do so;

(c) other prescribed information relating to the service provided and how
20it is funded (including the extent to which it is funded by the recipient).

(3) In this section “relevant service” means—

(a) a service consisting of overnight care in the individual’s own home
provided by or on behalf of a local authority;

(b) a residential care service provided by or on behalf of a local authority;

(c) 25a service consisting of overnight hospital accommodation.

(4) In subsection (3)(c) “hospital accommodation” means—

(a) in relation to England, hospital accommodation within the meaning of
the National Health Service Act 2006 which is provided by a Primary
Care Trust, an NHS trust or an NHS foundation trust;

(b) 30in relation to Wales, hospital accommodation within the meaning of the
National Health Service (Wales) Act 2006 which is provided by a Local
Health Board or an NHS trust;

(c) in relation to Scotland, hospital accommodation within the meaning of
the National Health Service (Scotland) Act 1978 which is provided by a
35Health Board or Special Health Board but excluding accommodation in
an institution for providing dental treatment maintained in connection
with a dental school.

(5) The local authority may—

(a) itself use the information for purposes relating to the payment of a
40relevant benefit to the individual, or

(b) supply the information to a person specified in subsection (6) for those
purposes.

(6) The persons referred to in subsection (5) are—

(a) the Secretary of State;

(b) 45a person providing services to the Secretary of State;

(c) a local authority;

(d) a person authorised to exercise any function of a local authority relating
to a relevant benefit;

(e) a person providing services relating to a relevant benefit to a local
authority.

(7) 5In this section “relevant benefit” means—

(a) universal credit;

(b) housing benefit;

(c) council tax benefit;

(d) any prescribed benefit.

(8) 10Regulations under subsection (7) may not prescribe a benefit provision for
which is within the legislative competence of the Scottish Parliament.

126 Information-sharing in relation to welfare services etc

(1) The Secretary of State, or a person providing services to the Secretary of State,
may supply relevant information to a qualifying person for prescribed
15purposes relating to welfare services.

(2) A qualifying person who holds relevant information for a prescribed purpose
relating to welfare services may supply that information to—

(a) the Secretary of State, or

(b) a person providing services to the Secretary of State,

20for a prescribed purpose relating to a prescribed benefit.

(3) A qualifying person who holds relevant information for a prescribed purpose
relating to welfare services or housing benefit may—

(a) use the information for another prescribed purpose relating to welfare
services or housing benefit;

(b) 25supply it to another qualifying person for use in relation to the same or
another prescribed purpose relating to welfare services or housing
benefit.

(4) Relevant information supplied under subsection (1) or (3) to a qualifying
person may be supplied by that person to a person who provides qualifying
30welfare services for purposes connected with the provision of those services.

(5) In subsection (4) services are qualifying welfare services if—

(a) a local authority, or

(b) a person who is a qualifying person by virtue of subsection (11)(g),

contributes or will contribute to the expenditure incurred in their provision.

(6) 35The Secretary of State may not exercise the power in subsection (3) to prescribe
purposes for which information may be supplied by a qualifying person so as
to prescribe an excepted purpose in relation to excepted information held by a
Welsh body.

(7) In subsection (6)—

(a) 40excepted information is information held by the Welsh body that—

(i) is not supplied by, or derived from information supplied to
another person by, the Secretary of State or a person providing
services to the Secretary of State or a person engaged in the
administration of housing benefit, and

(ii) 45is held only for an excepted purpose;

(b) an excepted purpose is a purpose relating to a matter provision for
which—

(i) is within the legislative competence of the National Assembly
for Wales, or

(ii) 5is made by the Welsh Ministers, the First Minister for Wales or
the Counsel General to the Welsh Assembly Government.

(8) The Secretary of State may not exercise the power in subsection (3) to prescribe
purposes for which information may be supplied by a qualifying person so as
to prescribe an excepted purpose in relation to excepted information held by a
10Scottish body.

(9) In subsection (8)—

(a) excepted information is information held by the Scottish body that—

(i) is not supplied by, or derived from information supplied to
another person by, the Secretary of State or a person providing
15services to the Secretary of State or a person engaged in the
administration of housing benefit, and

(ii) is held only for an excepted purpose;

(b) an excepted purpose is a purpose relating to a matter provision for
which is within the legislative competence of the Scottish Parliament.

(10) 20Subsections (1) to (4) do not apply in a case where the supply or use of
information is authorised by section 125.

(11) In this section “qualifying person” means—

(a) a local authority;

(b) a person authorised to exercise any function of such an authority
25relating to welfare services;

(c) a person providing services to a local authority relating to welfare
services;

(d) an authority which administers housing benefit;

(e) a person authorised to exercise any function of such an authority
30relating to housing benefit;

(f) a person providing to such an authority services relating to housing
benefit;

(g) a person prescribed or of a description prescribed by the Secretary of
State.

(12) 35In this section “relevant information” means information relating to—

(a) universal credit;

(b) state pension credit;

(c) income support;

(d) income-based jobseeker’s allowance;

(e) 40income-related employment and support allowance;

(f) housing benefit;

(g) any prescribed benefit;

(h) welfare services.

(13) In this section—

• 45“welfare services” includes services which provide accommodation,
  support, assistance, advice or counselling to individuals with particular

  Welfare Reform BillPage 98

  needs, and for these purposes “assistance” includes assistance by
  means of a grant or loan or the provision of goods or services;

• “person engaged in the administration of housing benefit” means—

  (a)

  an authority which administers housing benefit,

  (b)

  5a person authorised to exercise any function of such an
  authority relating to housing benefit, or

  (c)

  a person providing to such an authority services relating to
  housing benefit;

• “Scottish body” means—

  (a)

  10a local authority in Scotland,

  (b)

  a person authorised to exercise any function of such an
  authority relating to welfare services,

  (c)

  a person providing to a local authority in Scotland services
  relating to welfare services, or

  (d)

  15a person prescribed or of a description prescribed by the
  Secretary of State;

• “Welsh body” means—

  (a)

  a local authority in Wales,

  (b)

  a person authorised to exercise any function of such an
  20authority relating to welfare services,

  (c)

  a person providing to a local authority in Wales services
  relating to welfare services, or

  (d)

  a person prescribed or of a description prescribed by the
  Secretary of State.

127 25Unlawful disclosure of information

(1) A person to whom subsection (2) applies is guilty of an offence if the person
discloses without lawful authority any information—

(a) which comes to the person by virtue of section 126(1), (3) or (4), and

(b) which relates to a particular person.

(2) 30This subsection applies to—

(a) a person mentioned in section 126(11)(a) to (c);

(b) a person who provides qualifying welfare services (within the meaning
of section 126);

(c) a person who is or has been a director, member of the committee of
35management, manager, secretary or other similar officer of a person
mentioned in paragraph (a) or (b);

(d) a person who is or has been an employee of a person mentioned in
paragraph (a) or (b).

(3) A person guilty of an offence under this section is liable—

(a) 40on conviction on indictment, to imprisonment for a term not exceeding
2 years or a fine or both, or