House of Commons - Deregulation and Regulatory Reform

Select Committee on Deregulation and Regulatory Reform Tenth Report

TENTH REPORT

The Deregulation and Regulatory Reform Committee has agreed to the following Report:

I
DRAFT REGULATORY REFORM (HOUSING ASSISTANCE)
(ENGLAND AND WALES) ORDER 2002

1. On 17th April the Government laid before Parliament the draft Regulatory Reform (Housing Assistance) (England and Wales) Order 2002, together with an explanatory memorandum from the Department of Transport, Local Government and the Regions.[1] We have already reported on the proposal for this Order, which would remove many of the detailed provisions that govern the way local housing authorities carry out housing renewal, and replace them with a broad power to allow authorities to provide financial and other assistance for home repair and improvement which would be subject to only limited constraints.[2]

"First-stage" scrutiny: our previous Report

2. We were content that, in most respects, the proposal met the criteria against which we were required to judge it, and we recommended that a draft order in the same terms as the proposal be laid before the House. However, we were not convinced that the Government had taken appropriate account of the costs to local authorities of preparing for the new regime, and we recommended that the Department look again at the level of resources which would be required to ensure that local authorities were able to make the most effective transition from the current arrangements to the exercise of the new power.[3] We also made certain other recommendations regarding the transition to the new arrangements, namely:

that the guidance to be given on the exercise of the power conferred by the Order give a very clear steer to local authorities on the provision of financial advice; that Financial Services Authority guidance on giving financial advice and administering loans be incorporated into the guidance to authorities at the earliest possible opportunity; and that the Department stand ready to assist any authority which finds itself in need of any additional help in fulfilling its duties in this area;
that the Government make clear in their guidance to authorities the desirability of incorporating their policy on private sector housing renewal into their overall housing strategy, and publishing it as a single document; and
that the Government's commitment to greater discretion for authorities over their spending on private sector housing renewal should not be undermined by the inappropriate exercise of central Government control over the allocation of resources for local authorities.

The Government's response to our recommendations

3. We are pleased to note the Government's positive response to most of our recommendations regarding the transition to the new arrangements. In respect of financial advice, the Department reports that it has been in consultation with interested parties to ensure that local authorities receive all necessary assistance with the provision of such advice.[4] The Government has also accepted the Committee's recommendation regarding the publication of local authorities' policies on private sector housing renewal, made following comments from our colleagues on the Transport, Local Government and the Regions Committee, although it points out that housing strategies are likely to have a longer life than housing renewal polices, which will need to be updated as authorities develop new forms of assistance.[5] Finally, the Government restates its assurance that it "[has] no plans to restrict local authorities' discretion."[6]

4. The response to our recommendation regarding the resources available to local authorities for the exercise of the new power was more disappointing. The Government suggest that the amount of money made available "is primarily a matter for local decision-makers, as funds for private sector renewal are allocated from the single capital pot."[7] This response ignores the fact that local authorities will be faced with potentially substantial short-term costs to get new systems up and running:[8] the Government has given no indication that its allocation of capital funds for local authorities has taken any account of this additional burden. Nevertheless, in view of the support for the changes amongst local authorities, and local government's acceptance that any short-term costs incurred are likely to be proportionate to the longterm benefit of increased flexibility in the giving of assistance which the Order would confer,[9] we do not wish to press this point. We hope, however, that the results of the Spending Review 2002, to which the Department refer in their explanatory memorandum,[10] will reflect the resources required to ensure that local authorities are able to make the most effective transition from the current arrangements to the exercise of the new power.

Other representations

5. No representations other than the Reports of this Committee and of the Lords Committee[11] were received during the period for Parliamentary consideration.[12]

Report under Standing Order No. 141

6. We recommend unanimously that the draft Order be approved.

II
DRAFT REGULATORY REFORM
(CARER'S ALLOWANCE) ORDER 2002

Introduction

7. On 22 April the Government laid before Parliament the draft Regulatory Reform (Carer's Allowance) Order 2002, together with an explanatory statement from the Department for Work and Pensions.[13] We reported on the proposal for this Order in March, as did our sister Committee in the House of Lords.[14]

8. The draft Order seeks to amend the Social Security Contributions and Benefits Act 1992 (the 1992 Act) in order to introduce a more consistent approach to the provision of financial support for the carers of severely disabled people, irrespective of the age of the carer; to provide for such support to continue for a period (of eight weeks) after the death of the person cared for; and to change the name of the principal allowance concerned (currently known as the 'Invalid Care Allowance') to remove the alleged negative connotations of the existing title: in future it would be known as the 'Carer's Allowance'.

"First-stage" scrutiny: our previous Report

9. In our earlier consideration of the proposed Order we were particularly concerned (as were many of those who had responded to the Department's consultation exercise) about the potentially adverse impact of the rationalisation of support for carers on a very small group of older carers who would, when they reached the age of 65, lose the current entitlement to continued receipt of the allowance, even if they were to cease to perform a carer's role. The existing arrangements are, to say the least, unusual, in that they give a continuing right to a benefit after the original basis of the entitlement has been removed. We considered a number of alternative approaches to the protection of the small group who might be adversely affected by the removal of this unorthodox privilege, but concluded that this could not be achieved without creating further, and even less defensible, anomalies. We therefore concluded that the Department's proposals met the various tests (including those of fair balance, desirability, and protection of rights) which are laid down in the Regulatory Reform Act 2001. We have received no further evidence which might lead us to reconsider this conclusion.

10. Elsewhere in our earlier Report we suggested two small drafting changes to the proposed Order, both of which the Department has accepted. We note, however, that the final draft text now before us does not incorporate the first of these (a suggested addition to the preamble). This appears to be an oversight by the Department[15] but it is not one which we consider it necessary to require the Department to correct.

11. Our previous Report also commented adversely on the failure of the Department for Work and Pensions formally to consult the statutory Social Security Advisory Committee in the early consultation stages of this proposal. Ultimately, the views of the SSAC were taken on board, but by us (rather than the Department) and at a date probably too late to have significantly influenced Ministers' consideration of the details of the proposal.

The Government's response to our recommendations

12. The Government responded to our previous Report in the Statement laid with the draft Order on 22 April. The Government have accepted all our points of substance, and the small drafting changes which we recommended should be made in the preamble and in Article 4 (although, as noted above, the first of these has inadvertently not been included in the draft order laid before Parliament). They have also made a small change, in Article 1(1)(b), to facilitate earlier commencement, which we accept.

13. The Government's Statement also takes on board the two issues which we have regarded as of most consequence: First, they have undertaken[16] properly to take account of the position of the Social Security Advisory Committee in any future consultation exercises; and second, they have given further assurances[17] that an appropriate package of information and publicity measures will be put in place prior to the introduction of the benefits and allowance changes which will be triggered by this Order. We take particular note of the Department's assurance that it is "committed to ensuring that customers who are no longer entitled to ICA are advised of the benefits which might be available in their case, and where to seek further help and advice if they wish to claim."[18]

Other representations

14. No representations other than the Reports of this Committee and of the Lords Committee were received by the Department during the period of parliamentary consultation, other than the evidence received, at our instigation, from the Social Security Advisory Committee prior to our previous Report on this subject.

Report under Standing Order No. 141

15. We recommend unanimously that the draft Order be approved.

1 Copies are available to Members from the Vote Office and to members of the public from the Department for Transport, Local Government and the Regions. It is also available on the Cabinet Office website http://www.cabinetoffice.gov.uk/ regulation/act/proposals.htm. Back

2 Sixth Report, Session 2001-02 (HC 663). Back

3 ibid, para 58. Back

4 Explanatory memorandum, para 13. Back

5 ibid, para 20. Back

6 ibid, para 33. Back

7 ibid, para 29. Back

8 Sixth Report, op cit, para 56. Back