State Pension Credit Bill [Lords]

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Mr. Boswell: I beg to move amendment No. 23, in page 3, line 33, leave out subsection (8).

Mr. McCartney: On a point of order, Mr. Griffiths. I do not wish to complicate things, but will you explain what will happen to the amendments that have been withdrawn? I am mindful of ensuring that hon. Members do not lose the opportunity to discuss those issues because of today's difficulties.

The Chairman: As far as I understand it, the issue in question could probably be raised elsewhere in the Committee's scrutiny of the Bill. There will be sufficient time for new amendments to be tabled.

Mr. Boswell: I should like to respond—obliquely—to the Minister's point. In the words of General MacArthur, I will return. The Committee needs to return to those issues, and we will have to put our thinking caps on about how best to do it. I welcome the Minister's good will in saying that we should talk about them.

Superficially, amendment No. 23 is a bit like amendment No. 25, but it has a different and more limited effect. It would formally exclude regulations giving

    ''descriptions of persons in whose case the maximum savings credit shall be taken to be nil.''

Unless I have completely misunderstood the Bill and the explanatory notes, and have failed to attend to our discussions on amendment No. 14, with which we started the day, subsection (8) is about members of enclosed religious orders and prisoners.

Mr. McCartney indicated assent.

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Mr. Boswell: The Minister is nodding. I am relieved, because that is what I thought it was about. My first task in speaking to this probing amendment is to ask him to confirm formally and for the record that those are the persons that he has in mind.

I puzzled over the difference between clauses 2(6) and 3(8) without reaching any conclusion on whether it has significance, or whether it is merely necessary in order to facilitate the slightly different structures of the guarantee credit under clause 2 and the savings credit under clause 3, which we are now discussing. If the Minister refers back to this morning's debate, he will find that clause 2(6), which we wanted to delete and which relates to the same matter, is in a rather different form from the provision that amendment No. 23 would delete. In one case, the suggestion is that a prescribed amount under the guarantee should be set at a lower level, while in the other, it is that the savings credit—the product of the calculation, rather than the condition for it—should be nil. It would be useful for the Committee to find out whether there is a rationale for the slightly different approach. There may be, but the Minister might care to reflect on that.

3.15 pm

My second point relates to a point that we may want to make later in discussing eligibility and assessment periods. Almost by definition, the position of a prisoner is different from that of a person in an enclosed order. I understand that their treatment may be the same under the regulations, but in one case we are, I hope, dealing with volunteers, with the assumption that people who adopt the contemplative life will want to stay in their order indefinitely—although, of course, some do leave. In the other case, it is assumed that people are detained not at their pleasure but at Her Majesty's, by way of a custodial sentence.

I am not sure whether the issue has emerged from this Committee, but it does emerge from time to time. From time to time I am not unsympathetic to prisoners' interests. It would be in the common interest of the Committee to ensure that people get up and running as soon as possible after their incarceration, as we want them to be successful and useful members of society.

I realise that it is rather an extreme case of the double provision rule that if someone is inside, they should not receive pension credit. That is perfectly reasonable. However, as and when they come out, it is especially important that they should quickly be able to receive anything to which they are entitled.

In the past, I have asked the Minister's colleagues in the Home Office about the growing number of older prisoners in our prisons. I have not checked the figure, but I believe that there are more 4,000 pensioner prisoners. They need special attention and provision in the case of health care, for example. It would clearly be inappropriate to debate that today, but if they have an entitlement to state pension credit, they should be able to assume or resume it as soon as possible.

That matter is relevant to the assessment period, which we shall discuss later in other contexts, when we debate subsequent clauses. I am not clear what would

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happen in the case of an assessment covering a five-year period. If the person involved subsequently goes to prison—the example that we are considering in the amendment—and is inside for, say, 18 months, they may return within the original assessment period. I am anxious to determine not whether they should be paid credit while they are inside, but whether they should be paid on the basis of the original assessment when they regain their liberty. Is it a fresh start in every sense? Is there a reassessment? Is there discontinuity in the assessment period, or is it treated as continuous with a little local difficulty being remunerated at nil for the weeks of incarceration? That is more than a trivial issue. It will centre on some other issues, too.

Mr. McCartney: It is probably best to deal with that now. I would call that a change of circumstances. The person's income would cease from the point of conviction and incarceration. When they are ultimately allowed out, having completed their sentence in whatever forum, they will make a fresh application. That will not be unusual, because, under the Bill, changes in circumstances must be notified and that can affect either negatively or positively people's access to pension credit. It is simply another category.

Mr. Boswell: I remember from my days when I knew a little about agricultural tenancy that there were the so-called seven deadly sins if one was a tenant, the most deadly of which in both senses was to die during the tenancy because it was then impossible for the tenancy to continue in that form. Other sins were bankruptcy and so on.

Mr. McCartney: That was called penury.

Mr. Boswell: It is not too good in farming at the moment either.

The Minister said that such matters would constitute a change in circumstance. Whether the change would be notified by the prison authorities or the individual concerned is perhaps a matter for regulation, and a person would start again when released from prison. We could create many interesting scenarios about the proceeds of crime that had not been picked up and confiscated—I am neither advocating that nor entertaining it, but such an elucidation is interesting because the pensioner's income may have changed during prison, perhaps because, for example, he had received a substantial windfall from an auntie.

Because of the nature of the change of circumstances or the interruption, a flow of pension credit that would have been payable from day one for five years on an assessment would have to be reassessed and may give rise to a lower form of income thereafter. That constitutes not double provision, but double penalty. The right hon. Gentleman may want to reflect, not necessarily now—we are at the edge of determining the matter—whether he wants such an outcome.

It was not a waste of time to table the amendment. We are worried about targeting, although the explanatory notes confirm that the measure concerns enclosed orders for prisoners. We are worried about the operation of a change of circumstances and whether it is straightforward, which gives rise to an

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apparent inequity between periods before or after incarceration. I hope that the Minister can respond to the issue now or reflect on it later.

Mr. McCartney: The purpose of the subsection, along with clause 2(6) and (9), is to provide powers to ensure that prisoners and members of a religious order who are fully maintained by their order can be excluded from entitlement to pension credit. That is because the cost of maintaining those groups is met by other organisations.

The hon. Member for Daventry asked about the relationship between clause 3 and clause 2. I have received expert advice that clause 2(9) allows the amount for monks and nuns to be set at nil. Clause 2(6) covers hospital in-patients and also has links with clause 2(8). I am pleased that the experts are on my side and not on the hon. Gentleman's side. I do not mean that in the pejorative sense because I understand the complexities of this part of the Bill. Get lawyers involved, and clause 3 will result.

The proposed treatment of prisoners in respect of pension credit is consistent with the approach taken in relation to income support and other benefits. For example, prisoners are excluded from the working families and disabled person's tax credits and attendance allowance, and the basic state pension payment is suspended for the duration of the sentence. The amendment would remove the proposed power to prescribe cases in which the savings credit will be set at nil. It would mean that prisoners and members of religious orders who were fully maintained by their order would be eligible for savings credit on the same basis as other pensioners.

I know that the hon. Gentleman is not serious about paying savings credit to pensioners, although he became pretty close to that in his closing remarks. The needs of men and women in prison are met by the Home Office and the Prison Service. Extending the savings credit to prisoners would amount to double provision.

People in enclosed orders do not need state support because their needs are met by other organisations. Indeed, the state has no legitimate role in their financial affairs. Extending the savings credit to such people would inevitably involve making inquiries into their financial affairs. The provisions uphold tenets that have been the policy of Governments of both political persuasions since the establishment of the welfare state. I assure the hon. Gentleman that the exclusions are not in breach of our obligations under the European convention on human rights. It is the underpinning ethos of religious orders that there is no need for state support and there is no legitimate role for the state in the financial affairs of those committed to such a way of life.

When people on pension credit are imprisoned, their partners can claim as single people. When prisoners are detained in custody awaiting trial, any housing costs and payments, including housing benefit, will continue to be paid for a maximum of 52 weeks. I hope that those remarks will also reassure

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the hon. Gentleman in respect of other matters relating to prisoners' needs on sentence or pre-sentence.

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