Welfare Reform Bill

House of Commons

Session 2005 - 06
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Welfare Reform Bill

Welfare Reform Bill
Part 1 — Employment and support allowance
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Social Security Act 1998 (decisions under certain enactments to be
made by the Secretary of State);
(c)
the function under section 9(1) of that Act (revision of decisions), so far
as relating to decisions that relate to any matter arising under such
regulations;
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(d)
the function under section 10(1) of that Act (superseding of decisions),
so far as relating to decisions of the Secretary of State that relate to any
matter arising under such regulations;
(e)
any function under Chapter 2 of Part 1 of that Act (social security
decisions), except section 25(2) and (3) (decisions involving issues that
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arise on appeal in other cases), which relates to the exercise of any of the
functions mentioned in paragraphs (a) to (d).
(3)
Regulations under subsection (2) may provide that a function to which that
subsection applies may be exercised—
(a)
either wholly or to such extent as the regulations may provide,
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(b)
either generally or in such cases or areas as the regulations may
provide, and
(c)
either unconditionally or subject to the fulfilment of such conditions as
the regulations may provide.
(4)
An authorisation given by virtue of subsection (1), or by virtue of regulations
20
under subsection (2), may authorise the exercise of the function concerned—
(a)
either wholly or to such extent as may be specified in the authorisation,
(b)
either generally or in such cases or areas as may be so specified, and
(c)
either unconditionally or subject to the fulfilment of such conditions as
may be so specified.
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(5)
In the case of an authorisation given by virtue of regulations under subsection
(2), subsection (4) is subject to the provisions of the regulations.
(6)
An authorisation given by virtue of subsection (1), or by virtue of regulations
under subsection (2)—
(a)
may specify its duration,
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(b)
may be revoked at any time by the Secretary of State, and
(c)
shall not prevent the Secretary of State or any other person from
exercising the function to which the authorisation relates.
(7)
Where a person is authorised to exercise any function by virtue of subsection
(1), or by virtue of regulations under subsection (2), anything done or omitted
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to be done by or in relation to him (or an employee of his) in, or in connection
with, the exercise or purported exercise of the function shall be treated for all
purposes as done or omitted to be done by or in relation to the Secretary of
State.
(8)
Subsection (7) shall not apply—
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(a)
for the purposes of so much of any contract made between the
authorised person and the Secretary of State as relates to the exercise of
the function, or
(b)
for the purposes of any criminal proceedings brought in respect of
anything done or omitted to be done by the authorised person (or an
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employee of his).
(9)
Where—

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Part 1 — Employment and support allowance
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(a)
a person is authorised to exercise any function by virtue of subsection
(1), or by virtue of regulations under subsection (2), and
(b)
the authorisation is revoked at a time when a relevant contract is
subsisting,

the authorised person shall be entitled to treat the relevant contract as
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repudiated by the Secretary of State (and not as frustrated by reason of the
revocation).
(10)
In subsection (9), the reference to a relevant contract is to so much of any
contract made between the authorised person and the Secretary of State as
relates to the exercise of the function.
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Miscellaneous
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Income and capital: general
(1)
In relation to a claim for an employment and support allowance, the income
and capital of a person shall be calculated or estimated in such manner as may
be prescribed.
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(2)
A person’s income in respect of a week shall be calculated in accordance with
prescribed rules, which may provide for the calculation to be made by
reference to an average over a period (which need not include the week
concerned).
(3)
Circumstances may be prescribed in which—
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(a)
a person is to be treated as possessing capital or income which he does
not possess;
(b)
capital or income which a person does possess is to be disregarded;
(c)
income is to be treated as capital;
(d)
capital is to be treated as income.
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(4)
Regulations may provide that a person’s capital shall be deemed for the
purposes of this Part to yield him an income at a prescribed rate.
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Disqualification
(1)
Regulations may provide for a person to be disqualified for receiving an
employment and support allowance, or treated for such purposes as the
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regulations may provide as not having limited capability for work, if—
(a)
he has become someone who has limited capability for work through
his own misconduct,
(b)
he remains someone who has limited capability for work through his
failure without good cause to follow medical advice, or
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(c)
he fails without good cause to observe any prescribed rules of
behaviour.
(2)
Regulations under subsection (1) shall provide for any such disqualification, or
treatment, to be for such period not exceeding 6 weeks as may be determined
in accordance with Chapter 2 of Part 1 of the Social Security Act 1998 (c. 14).
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(3)
Regulations may prescribe for the purposes of this section—
(a)
matters which are, or are not, to be taken into account in determining
whether a person has good cause for any act or omission;

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(b)
circumstances in which a person is, or is not, to be regarded as having
good cause for any act or omission.
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Pilot schemes
(1)
Any regulations to which this subsection applies may be made so as to have
effect for a specified period not exceeding 24 months.
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(2)
Subject to subsection (3), subsection (1) applies to—
(a)
regulations which are made under any provision of this Part, other than
sections 3, 8 and 9;
(b)
regulations which are made under the Administration Act, so far as
they relate to an employment and support allowance.
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(3)
Subsection (1) only applies to regulations if they are made with a view to
ascertaining whether their provisions will or will be likely to—
(a)
encourage persons to obtain or remain in work, or
(b)
make it more likely that persons will obtain or remain in work or be
able to do so.
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(4)
Regulations which, by virtue of subsection (1), are to have effect for a limited
period are referred to in this section as a “pilot scheme”.
(5)
A pilot scheme may provide that its provisions are to apply only in relation
to—
(a)
one or more specified areas;
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(b)
one or more specified classes of person;
(c)
persons selected—
(i)
by reference to prescribed criteria, or
(ii)
on a sampling basis.
(6)
A pilot scheme may make consequential or transitional provision with respect
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to the cessation of the scheme on the expiry of the specified period.
(7)
A pilot scheme may be replaced by a further pilot scheme making the same or
similar provision.
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Relationship with statutory payments
(1)
A person is not entitled to an employment and support allowance in respect of
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a day if, for the purposes of statutory sick pay, that day—
(a)
is a day of incapacity for work in relation to a contract of service, and
(b)
falls within a period of entitlement (whether or not it is a qualifying
day).
(2)
Except as regulations may provide, a woman who is entitled to statutory
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maternity pay is not entitled to a contributory employment and support
allowance in respect of a day that falls within the maternity pay period.
(3)
Regulations may provide that—
(a)
an amount equal to a woman’s statutory maternity pay for a period
shall be deducted from a contributory employment and support
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allowance in respect of the same period,
(b)
a woman shall only be entitled to a contributory employment and
support allowance if there is a balance after the deduction, and

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(c)
if there is such a balance, a woman shall be entitled to a contributory
employment and support allowance at a weekly rate equal to it.
(4)
Except as regulations may provide, a person who is entitled to statutory
adoption pay is not entitled to a contributory employment and support
allowance in respect of a day that falls within the adoption pay period.
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(5)
Regulations may provide that—
(a)
an amount equal to a person’s statutory adoption pay for a period shall
be deducted from a contributory employment and support allowance
in respect of the same period,
(b)
a person shall only be entitled to a contributory employment and
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support allowance if there is a balance after the deduction, and
(c)
if there is such a balance, a person shall be entitled to a contributory
employment and support allowance at a weekly rate equal to it.
(6)
In this section—
“adoption pay period” has the meaning given in section 171ZN(2) of the
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Contributions and Benefits Act;
“maternity pay period” has the meaning given in section 165(1) of that
Act.
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Supplementary provisions
Schedule 2 (which contains further provisions in relation to an employment
20
and support allowance) has effect.
General
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Interpretation of Part 1
(1)
In this Part—
“claimant” means a person who has claimed an employment and support
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allowance;
“contributory allowance” has the meaning given by section 1(7);
“entitled”, in relation to an employment and support allowance, is to be
construed in accordance with—
(a)
the provisions of this Act,
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(b)
section 1 of the Administration Act (entitlement dependent on
making of claim), and
(c)
section 27 of the Social Security Act 1998 (c. 14) (restrictions on
entitlement in certain cases of error);
“income-related allowance” has the meaning given by section 1(7);
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“income support” means income support under section 124 of the
Contributions and Benefits Act;
“limited capability for work” shall be construed in accordance with
section 1(4);
“limited capability for work-related activity” shall be construed in
40
accordance with section 2(5);
“period of limited capability for work” has the meaning prescribed for the
purposes of this Part;

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“prescribed” means specified in, or determined in accordance with,
regulations;
“regulations” means regulations made by the Secretary of State;
“week” means a period of 7 days beginning with a Sunday or such other
period of 7 days as may be prescribed;
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“work-related activity” has the meaning given by section 12(7).
(2)
For the purposes of this Part, the assessment phase, in relation to a claimant, is
the period—
(a)
beginning, subject to subsection (3), with the first day of the period for
which he is entitled to an employment and support allowance, and
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(b)
ending with such day as may be prescribed.
(3)
Regulations may prescribe circumstances in which the assessment phase is to
begin with such day as may be prescribed.
(4)
For the purposes of this Part, a person is a member of the support group if he
is a person in respect of whom it is determined that he has, or is to be treated
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as having, limited capability for work-related activity.
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Regulations
(1)
Any power under this Part to make regulations shall be exercisable by
statutory instrument.
(2)
Any such power may be exercised—
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(a)
in relation to all cases to which it extends,
(b)
in relation to those cases subject to specified exceptions, or
(c)
in relation to any specified cases or classes of case.
(3)
Any such power may be exercised so as to make, as respects the cases in
relation to which it is exercised—
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(a)
the full provision to which the power extends or any less provision
(whether by way of exception or otherwise);
(b)
the same provision for all cases in relation to which it is exercised, or
different provision for different cases or different classes of case or
different provision as respects the same case or class of case for
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different purposes of this Part;
(c)
any such provision either unconditionally or subject to any specified
condition.
(4)
Where any such power is expressed to be exercisable for alternative purposes,
it may be exercised in relation to the same case for all or any of those purposes.
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(5)
Any such power includes power—
(a)
to make such incidental, supplementary, consequential or transitional
provision or savings as appear to the Secretary of State to be expedient;
(b)
to provide for a person to exercise a discretion in dealing with any
matter.
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(6)
Without prejudice to the generality of the provisions of this section, regulations
under any of sections 10 to 14 may make provision which applies only in
relation to an area or areas specified in the regulations.

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(7)
The fact that a power to make regulations is conferred by this Part is not to be
taken to prejudice the extent of any other power to make regulations so
conferred.
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Parliamentary control
(1)
None of the following regulations shall be made unless a draft of the statutory
5
instrument containing them has been laid before and approved by a resolution
of each House of Parliament—
(a)
the first regulations under section 12;
(b)
regulations which by virtue of section 18(1) are to have effect for a
limited period.
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(2)
A statutory instrument that—
(a)
contains regulations made under this Part, and
(b)
is not subject to a requirement that a draft of the instrument be laid
before, and approved by a resolution of, each House of Parliament,

shall be subject to annulment in pursuance of a resolution of either House of
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Parliament.
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Financial provisions relating to Part 1
(1)
There shall be paid out of the National Insurance Fund so much of any sums
payable by way of employment and support allowance as is attributable to
entitlement to a contributory allowance.
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(2)
There shall be paid out of money provided by Parliament—
(a)
so much of any sums payable by way of employment and support allowance as
is attributable to entitlement to an income-related allowance, and
(b)
any administrative expenses of the Secretary of State or the Commissioners for
Her Majesty’s Revenue and Customs in carrying this Part into effect.
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(3)
The Secretary of State shall pay into the National Insurance Fund sums
estimated by him to be equivalent in amount to sums recovered by him in
connection with payments of contributory allowance.
(4)
The Secretary of State shall pay into the Consolidated Fund sums estimated by him to
be equivalent in amount to sums recovered by him in connection with payments made
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by way of income-related allowance.
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Consequential amendments relating to Part 1
(1)
Schedule 3 (which makes amendments consequential on this Part) has effect.
(2)
Regulations may make provision consequential on this Part amending,
repealing or revoking any provision of—
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(a)
an Act passed on or before the last day of the Session in which this Act
is passed, or
(b)
an instrument made under an Act before the passing of this Act.
(3)
In subsection (2), “Act” includes an Act of the Scottish Parliament.