Examination of Witnesses (Questions 40
- 59)
WEDNESDAY 7 DECEMBER 2005
DEPARTMENT FOR
WORK AND
PENSIONS
Q40 Greg Clark: But not the most
important?
Mr Lewis: No, I am not going to
say it is the most important of any other issue, but it is certainly
one of the most important.
Q41 Greg Clark: Just on this issue
of importance and how this matters, page 21, box 6 of the Report
has a list of the departmental objectives. There is no mention
of complexity or simplification. Do you think that is an omission?
Mr Lewis: I think the last one
actually, perhaps the word "complexity" is not there
but "to modernise welfare delivery so as to improve the accessibility,
accuracy and value for money of services customers, including
employers", I think that is four square in the territory
that we are talking about.
Q42 Greg Clark: We are talking about
simplicity and lack of complexity. If that is what it means, there
should be an objective that says "to simplify or to make
less complex the benefits system."
Mr Lewis: I will not promise this
afternoon to start re-writing departmental objectives, but what
I will say is that I certainly read that final objective to embrace
the key issues of simplicity and making the system less complex.
Q43 Greg Clark: I do not want to
labour the point but the precise issue we are talking about is
that it should not require people to divine what a statement means.
It should be clear, and that should apply to the benefits system
as much as it should apply to the objectives the Department faces,
and if that is implied in that, it was not obvious to me and I
suspect it may not be obvious to other people. So it would be
in the spirit of simplification if that could be clarified, because
that is something you might be able to look at.
Mr Lewis: What I will say is,
because, as you say, this is a new Department to me, as we come,
Ministers and their top team, to look at the Department's objectives,
that is something which I will want to have very much in mind.
Q44 Greg Clark: In terms of your
objectives, the Department has a Public Service Agreement with
the Treasury. Is simplifying the benefits system one of those
objectives?
Mr Lewis: Yes, it most certainly
is one of those objectives. Objective number 10 is to reduce fraud
and error in IS and JSA and in Housing Benefit and that is absolutely
about error and indeed fraud, about reducing complexity. So those
targets are four square in relation to that.
Q45 Greg Clark: It would help to
clarify that a bit more. In terms of the consequences of complexity,
and this is a problem, obviously, it has knock-on effects on different
areas of national life. One reference, for example, is on the
claimants, the take-up of the benefits. The Save the Children
Fund this week said that one in ten children was living in extreme
poverty. Do you think the low take-up of benefits contributes
to that and is the complexity one of the determinants of that?
Mr Lewis: Yes. I just do not think
one can argue against the proposition that the more complex a
benefit is and the more daunting it may seem to an applicant,
that has got to have an impact on take-up, so if we can make our
benefits less complex, then I think that will help us in one of
our key objectives, which is to increase take-up. I will not bore
you with numbers and figures but we have done some very good things
in the Department in the last few years to increase take-up of
some of the key benefits, but there is obviously a relationship
between those two things.
Q46 Greg Clark: Would you agree with
the Report when it says that the complexity of the benefits system
has deterred saving for retirement. Is that something you would
agree with?
Mr Lewis: We have just had the
Turner Commission Report and I think one of the things that Adair
Turner has said in his Report is that taken overall, the pension
system in this country, at least in some of its key elements,
is a complex system which people have difficulty in understanding
in full, and I think one of the objectives set out in the Turner
Report is to arrive at a less complex pension system.
Q47 Greg Clark: In reviewing this
area, the National Audit Office expended resource in order to
come up with useful recommendations and analysis, and they say
the complexity of the benefits system—they also talk about
pensions separately—has deterred saving for retirement.
Is that something, as Permanent Secretary, that you would accept?
Mr Lewis: I certainly do not seek
to quarrel with the National Audit Office Report, which is an
agreed Report between us.
Q48 Greg Clark: Does that mean yes,
you agree it has deterred saving for retirement?
Mr Lewis: That has to be one of
the areas we seek to improve in the future.
Q49 Greg Clark: So just to be clear,
you agree with the NAO's assessment that the complexity of the
benefits system has deterred saving for retirement?
Mr Lewis: Yes. I am not seeking,
to be clear, to quarrel with any of the statements in the NAO's
Report.
Q50 Greg Clark: Perhaps Ms Diggle
can comment from the Treasury's point of view. Is that something
the Treasury concurs with, that, in the NAO's words, the complexity
of the benefits system has deterred saving for retirement?
Ms Diggle: It is certainly something
that we take very seriously, and we certainly want the incentive
to save—
Q51 Greg Clark: I am talking about
the Report. Is that something that the Treasury agrees with, the
NAO's assessment?
Ms Diggle: Of course we do.
Q52 Greg Clark: Just turning to the
measurement of complexity that Mr Davidson brought up earlier
on, it is very helpful that there is going to be a team charged
with reducing complexity. What direction is it going in at the
moment? Do you have a feel for whether the system is getting more
complex or less complex?
Mr Lewis: The truthful answer
to that question is I do not. I simply have not been in the Department
long enough. I think there are countervailing pressures. I think
there have been some very significant moves to reduce complexity,
and yet in other respects, inevitably, for example, taking a very
recent example, this week we have had the legislation coming into
force of the legislation relating to civil partnerships, legislation
widely welcomed in this country.
Q53 Greg Clark: The question is about
measurement.
Mr Lewis: Indeed, but just to
finish the point, inevitably, however, that has to be reflected
into the benefits system. Changes have to be made to accommodate
those new laws, that new way of looking at civil partnerships.
Q54 Greg Clark: But in terms of coming
up with a measure to be able to summarise the overall complexity—and
I concede there is often a good reason for it—is this something
that is part of the new team's objectives to come up with a measure
or a set of measures that would give us a handle on the complexity?
Mr Lewis: I would love to think
that it was possible to devise a simple measure of complexity.
I rather doubt that it is. It is interesting that, subject to
correction, I do not think the NAO Report has been able to come
up with a simple measure by which you can judge the overall complexity
of the system. I am going to ask this new team, as part of its
remit, to think outside the box. I do not want it to be trammelled
by what we may have done before.
Q55 Greg Clark: When you come back
in the future, do you expect or hope to be able to say whether
the system has become more or less complex?
Mr Lewis: Yes, I do and I would
like to think that I could provide, when I come back to the Committee,
real, demonstrable evidence that it has become less complex.
Q56 Greg Clark: Would you consider
publishing perhaps an annual report on the complexity of the benefits
system and what progress has been made to simplify the system?
Mr Lewis: One recommendation in
the Report that we do absolutely accept is that we should put
into our annual Report a statement about the complexity of the
benefits system.
Q57 Greg Clark: Which would hopefully
be supported by a measure?
Mr Lewis: Again, I do not want
to go back over that ground. If we can find better ways of measuring
complexity, I think we should. I do not want to pretend to you
that I think that is easy.
Q58 Greg Clark: Just on the consequences
of the current system, the Report says that 1.3 million cases
fall to the Citizens' Advice Bureau to deal with as a result of
the inability of claimants to understand the system. Is that something
that the Department will compensate the CAB for?
Mr Lewis: Not in terms, no, but
actually, in preparation for this hearing I went to a CAB office
yesterday because I wanted to hear at first hand some of their
experiences of helping their customers with the system, and it
was interesting, because certainly they did tell me about some
of the areas where they find the system complex and difficult.
Encouragingly, actually, they also said there were some areas
where they thought we were improving.
Q59 Greg Clark: Financially, they
are having this workload, and they are a voluntary organisation,
as we know. It seems reasonable if this is a consequence of complexity
that the Department actually should help them meet the costs of
this. It seems only fair.
Mr Lewis: I think the CAB is a
well established organisation with its own funding routes and
mechanisms.
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