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Incapacity Benefit Green Paper

6. Mr. Adam Holloway (Gravesham) (Con): Why the incapacity benefit Green Paper was not published before the summer recess. [31686]
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The Secretary of State for Work and Pensions (Mr. John Hutton): The welfare reform Green Paper will be published in January, taking forward our agenda to build a modern, active and inclusive welfare state, built on the principle of individual rights and responsibilities.

Mr. Holloway: Does the Secretary of State acknowledge that, in 1998, one of his many predecessors said that

Why are 1 million people still waiting?

Mr. Hutton: We have introduced a series of reforms that have seen the number of new claimants for incapacity benefit fall by a third and, for the first time since records began to be collected, there has been an overall fall in the total numbers claiming incapacity benefit. Our proposals will be announced in January and will extend new opportunities to people who have a sickness or a disability. I hope that the hon. Gentleman will welcome them when he sees them.

Tony Baldry (Banbury) (Con): The fact of the matter is that many people want to get back into work, but who is going to lead them back? Is it the responsibility of Jobcentre Plus or the Learning and Skills Council or some other body? People who may just have come out of prison or who have been out of work for a long time need someone to help them, if they are on incapacity benefit, back to work. Which Government agency is responsible for helping those people? We hear about so many statistics, but the reality is that these people need practical help, so which Government agency should provide it?

Mr. Hutton: The lead responsibility clearly lies with Jobcentre Plus, but it needs to work in partnership with local organisations, including the voluntary sector and some private providers. That is necessary to provide a proper package of support to help people to get back into work quickly. That is what we want and the main responsibility clearly lies with Jobcentre Plus.

Mr. Bob Blizzard (Waveney) (Lab): Will my right hon. Friend assure me that, in the forthcoming Green Paper, he will not overlook the needs of people whose disability is mental ill health? Too often we overlook such people and I believe that, in designing a new system of incapacity benefit, we must ensure that they are not neglected.

Mr. Hutton: Yes, I am grateful to my hon. Friend. I believe that something like four in 10 of new claimants for incapacity benefit are reporting a mental illness of some kind or other. It is important, if we are to make progress with the reforms, that we specifically address the needs of those people.

Pension Fund Deficits

7. Mr. Henry Bellingham (North-West Norfolk) (Con): What his most recent estimate is of the level of pension fund deficits; and if he will make a statement. [31688]
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The Minister for Pensions Reform (Mr. Stephen Timms): There are different ways of estimating pension fund deficits. The pensions regulator estimated last month that the aggregate deficit measured on the FRS 17 accounting standards was £130 billion as of December 2004.

Mr. Bellingham: The Minister may be aware that many of my constituents have had their lives ruined as a result of company pension schemes being wound up. The firms include Motokov, Albert Fisher and Dalgety. Some of my constituents do not even qualify for help under the financial assistance scheme. Does he understand the anger and dismay that that causes and recognise that it is heightened by the way in which the Government are treating public sector pensions? Does he believe in a two-tier pensions system?

Mr. Timms: I would have thought that the hon. Gentleman would welcome the extent to which the financial assistance scheme is helping people who find themselves in the difficult circumstances that he described. In the case of Dalgety, of course, there has not been an insolvency, so in those circumstances, the employer has the responsibility of honouring the pension promises that it has made. As to public sector pensions, I advise the hon. Gentleman to look at the advice given to him and his fellow Conservative candidates by the Conservative party during the last election. It was made very clear that the Conservative party did not support changes to public sector pension arrangements. I admit that the position appears to have changed somewhat over the last couple of weeks, but simply jumping on a new bandwagon is not a very good way of tackling the problem.

Mr. Robert Goodwill (Scarborough and Whitby) (Con): About 2,000 current and former employees of Scarborough bus and coach builder Henlys stand to receive only a third of their expected pensions after the company ceased trading, with a pension deficit of £80 million. Workers within three years of retirement would normally have qualified for the Government's financial assistance scheme, but no insolvency event has occurred. Is the Minister aware of that case, as well as Dalgety, and what would he say to my constituents who may be deprived of financial assistance through what they see as a financial technicality?

Mr. Timms: I am grateful to the hon. Gentleman for drawing this case to my attention, but I can say to him only what I said to the hon. Member for North-West Norfolk (Mr. Bellingham)—that in the case of Henlys, the company has not become insolvent. People therefore need to look to the employer to honour the pension promise that was made.

Housing Benefit

8. Adam Afriyie (Windsor) (Con): If he will make a statement on his plans to reform housing benefit. [31689]

The Parliamentary Under-Secretary of State for Work and Pensions (Mr. James Plaskitt): Reform is already under way. In 2002, we put in place a comprehensive
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strategy for the reform of housing benefit, which is already delivering results. For example, the average processing times for new claims have been cut by two weeks. We are also testing a simpler system for paying housing support in the private sector—the local housing allowance. The findings of the 18 pathfinder authorities are being carefully evaluated and will inform our decisions on the next steps towards improving support for housing costs. Reform in this respect, of course, needs to complement our overall strategy on welfare reform.

Adam Afriyie: I thank the Minister for his answer, but there rightly continues to be concern about the effect of the Government's housing policies. In particular, the pathfinder pilot appears to discriminate against those on the lowest incomes who are claiming housing benefit. Which of his Department's policies does he believe has been the least successful in this area?

Mr. Plaskitt: I studied very carefully indeed the responses from all 18 pathfinder authorities and they do not confirm what the hon. Gentleman is saying. In fact, all have achieved considerable success and there certainly are useful and important aspects of this reform that we can build on. I ask him to bear in mind the other aspect of housing benefit reform—the current scheme's performance. I wonder whether he might give us a hand by having a word with his local Liberal Democrat-controlled council, whose performance on processing housing benefit has slipped from 28-day processing in 2002 to 52-day processing.

David Taylor (North-West Leicestershire) (Lab/Co-op): The Lord's prayer that we have just said in this Chamber consists of 66 words and there are 42 laws of cricket, but the housing benefit regulations consist of 967 pages, five parts, six schedules and 40 statutory instruments. Does my hon. Friend agree that it is no wonder that the local authorities charged with implementing housing benefit find those regulations too intricate, long-winded and expensive? Which of their reactions and comments is he taking on board in order to tackle this problem more effectively than in the past 20 years?

Mr. Plaskitt: We have of course been assisting local authorities in handling this complicated benefit, and we have put in place the performance standards fund. Some £160 million has been allocated to 370 local authorities, many of which have been extremely successful in improving their performance in processing the benefit. My Department sets a 36-day standard for processing, and that standard is now being met by 222 local authorities; three years ago it was met by only 129. My hon. Friend is right to point to the benefit's complexities, and such complexities are the reason why we are starting to simplify it and reviewing more far-reaching reform.

Mr. David Ruffley (Bury St. Edmunds) (Con): According to the National Audit Office, £600 million a year is lost through housing benefit fraud. Although we Conservatives welcome the introduction of flatter, more standard-rate elements to housing benefit, which must be sensible, it is being restricted to the private sector.
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I learned that, according to the Minister's Department, such reform of the social rented sector will be achieved only toward the end of the decade. What on earth is he waiting for?

Mr. Plaskitt: No, we have not said that. We have pointed out that there are very substantial differences between the structures of the housing markets in the private and social rented sectors, so any reform of the benefit must of course take that into account. On fraud and error, the £600 million figure to which the hon. Gentleman referred is correct, but I should point out that losses arising from housing benefit fraud have fallen by 30 per cent. in the past 18 months. My Department has set a target of reducing fraud and error jointly by 25 per cent. by 2006, and we are on course to meet it.

Mr. David Kidney (Stafford) (Lab): I congratulate my hon. Friend on the careful way in which the local housing allowances are being piloted. However, has he seen representations made by groups such as Shelter and Barnado's on the effect of the single room rent control on the under-25s? In some cases, considerable hardship has been caused to vulnerable young people. If he can identify some modest changes to the rules that will meet our concerns about those vulnerable people, will he do so?

Mr. Plaskitt: I have studied the submissions to which my hon. Friend refers carefully and we do not believe that expecting young people to share accommodation is unreasonable. After all, 60 per cent. of single childless young people aged under 25 who are not in receipt of benefit rent shared accommodation. We must consider that abolishing the single room rent would result in single young people on benefit being able to afford a level of housing that many of their working peers cannot.

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