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Lord Henley: My Lords, as always, we have had a very interesting debate--what the noble Lord, Lord Morris of Castle Morris, calls a ritual dance. He has taken part in that dance for a number of years longer than I have, but I hope to outlast him and look forward to debating with him again next year and the year after from this side of the Box.

As we go through this "ritual dance", we hear ritual noises from the parties opposite, and particularly from the Liberal Party, of alleged cuts in education at a time when this year we were able to find an extra £878 million for education as a whole.

Lord Tope: My Lords, I am grateful to the Minister for giving way. He should not perhaps try to quote such figures to me. Is he aware that Ministers in another place have accepted that the additional money that the Government made available does not even reach the amount of money that the local education authorities themselves were already providing and that therefore no

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additional money has gone into the publicly funded education sector this year? In fact, there has been another reduction.

Lord Henley: My Lords, that is absolute nonsense. An extra £878 million has come from the central taxpayer and has gone to local authorities in the form of whatever the grant is called and made available to schools. One simply cannot say that there has not been extra money. I reject the allegations of cuts. We have seen considerable increases in the size of the education budget over the years. As I have made clear to the House on a number of occasions, throughout the United Kingdom we now spend something of the order of £35 billion on education at all levels. That is a very considerable sum indeed.

I totally reject the suggestion made by the noble Lord, Lord Morris of Castle Morris, that this is some form of charitable relief for the independent sector and particularly the boarding part of it. First, let me make clear that, despite what he said, the assisted places scheme does not cover boarding fees. If a child is in receipt of an assisted place and is boarding, the boarding fees will come from somewhere else. So this is not outdoor relief or charitable relief for the maintained sector.

Let me also make clear the size of the sector about which we are talking. On average, less than one in seven of all pupils at assisted places schemes are government assisted pupils. Assisted pupils make up less than 0.4 per cent. of the total maintained and independent sector school population. So to say that they are keeping together the independent sector--or rather the 300 schools that benefit from the scheme--is quite simply nonsense. Also, to say that they will have an undue effect on the maintained sector by creaming off those from locally maintained schools is again nonsense and does not take us any further forward at all.

Both the noble Lords, Lord Morris and Lord Tope, made much of inspection. I can assure them that Ofsted will continue to inspect as and where appropriate and will conduct those inspections in as rigorous a manner as in the maintained sector. But it is obviously a matter for Ofsted, which is an independent body, and not one for the Government to direct, to decide exactly which schools it should inspect.

The noble Lord, Lord Tope, also tried to make out that those who benefit from the scheme were not those who ought to benefit from it. Let me make it quite clear that we have conducted quite an amount of research into the socio-economic background of parents and children who benefit. We know from an independent survey carried out by MORI for the Independent Schools Information Service that 80 per cent. of parents in the scheme--not the 40 per cent. claimed by the noble Lord--come from socio-economic groups which have not traditionally been associated with private schooling; that is, the upper and middle classes. I can also assure the noble Lord that again some 80 per cent. come from classes C1, C2 and DE--again, not those associated with private education.

I accept that the party opposite, like us, believes that we ought to extend opportunities for all pupils. But unlike that party, we believe in doing so by expanding choice and diversity and by placing choice in the parents' hands. That

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is why earlier this afternoon we debated the nursery voucher scheme and I am grateful that it has now completed its course through this House. The assisted places scheme also plays a vital part in this process. It is plainly achieving its objective of giving access to some of the best independent schools for children who would not otherwise have been able to contemplate them. We on this side of the House believe that that can only be to their and the nation's advantage. That is why I quoted the figures earlier. We intend to give twice as many children this opportunity and will expand and extend the scheme accordingly. The draft regulations before the House help to achieve just that. I commend them to your Lordships.

On Question, Motion agreed to.

Social Security (Overpayments) Bill

6.40 p.m.

Lord Mackay of Ardbrecknish: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.--(Lord Mackay of Ardbrecknish.)

On Question, Motion agreed to.

House in Committee accordingly.

[The DEPUTY CHAIRMAN OF COMMITTEES (Viscount Allenby of Megiddo) in the Chair.]

Clause 1 [Recovery of overpayments of social security benefit: amendments]:

Earl Russell moved Amendment No. 1:

Page 1, line 7, at end insert--
("( ) At the end of subsection (1), there shall be inserted "; so, however, that in a case where the misrepresentation or failure in question was not fraudulent, the Secretary of State shall only be entitled to recover the amount which is referable to the 12 months immediately preceding the determination.").

The noble Earl said: If the Minister will forgive me, a moment ago he said something to me which was a little unwise. He suggested that we should call it a draw. But the Minister knows the next thing that happens when there is a draw. It is a little late at night for a replay so I hope that we shall not have to have one. And I can assure my noble friend that there is no need for a penalty shoot-out on this Bill. This is an uncontentious, relatively calm part of tonight's business and I am glad that it is so.

The effect of Amendment No. 1 is to provide that the DSS should not be able, except where there is a case of fraud, to recover overpayments over a period longer than 12 months. The Minister knows perfectly well that the DSS has a rule that people who have had underpayments can recover them only for a period of 12 months; indeed, if they have the misfortune to be involved in a test case, not even for 12 months.

I do not maintain that there is anything in the least sacrosanct about the period of 12 months. I can remember some time ago, before the Minister was with us, arguing against that rule. I lost the argument and accepted it. My point is that if a period is stated, it should be the same

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period for both the DSS and the claimant. That is the principle on which the amendment rests; that what is sauce for the goose is sauce for the gander.

Even if there is not an equal period, there is no case, if there is a variation, for the department being able to recover overpayments over a longer period than the claimant. The Minister may not yet have been able to look at Elaine Kempson's book, Life on a Low Income, published by the Rowntree Trust. I hope that he will have time to look at it over the summer because we shall hear a lot more about it in time to come. The book deals at some length with a subject that I have often called to the Minister's attention; that is, the subject of debt on benefit; the problem of juggling with bills while the debt builds up; the problems of disconnection of water, electricity and so forth with which we are all familiar. It can be a serious problem and the intrusion into that pattern of heavily and barely manageable debt of a large overpayment over a period longer than 12 months can be crippling.

I am not suggesting that anyone who has been guilty of fraud should be spared that penalty. But where they have not it would seem harsh, especially when the department itself does not pay beyond the 12 months. In Elaine Kempson's book, in a study of 74 households on ordinary benefit without penalties, she found that 20 out of 74 seemed to be drowning in financial problems. I see no sense in deliberately thrusting them further under water. I beg to move.

Lord Mackay of Ardbrecknish: The purpose of this amendment is, with the exception of fraudulent or negligent overpayments, to restrict the period of a recoverable overpayment to 12 months from the date on which it is determined that a recoverable overpayment has occurred.

As the noble Earl has said on many occasions, the social security system is complex and difficult to understand--a sentiment with which I agree. The present test of misrepresentation or failure to disclose is relatively simple. To impose a test which required adjudication officers to decide on fraudulent intent or negligence in respect of overpayments going back over 12 months would be to add significantly to the complexity of deciding whether or not overpayments are recoverable. What adjudication officers would have to do is to try and understand the thought processes and knowledge of the person claiming benefit when they failed to disclose or misrepresented a material fact. That would indeed be an extremely difficult and complex thing to do and would provide huge scope for those claimants who were deliberately abusing the social security system to limit their potential financial liability.

In any case, I can see no reason why the period of recoverable overpayments should be restricted to 12 months from the date that a determination is made. The test as applied, that overpayments are recoverable where a claimant has fraudulently or otherwise misrepresented or failed to disclose any material fact, is a reasonable one. It was first introduced by the government in 1948--not of my party--and has been reconfirmed by successive governments in subsequent Acts, none of which restricted the period of recoverable overpayments.

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It is important to remember that when people claim benefits they are receiving public money which the taxpayer has worked hard to provide. It is therefore incumbent on claimants to ensure that they have reported everything that they should regarding their claim to benefit. Even where we are dealing with innocent misrepresentation where the claimant knew the facts but failed to report them--and those cases are rare--the claimant has benefited from public money to which he or she was not entitled. It can certainly be argued that asking for the overpayment to be repaid is hard on the claimant, but it is equally hard on the taxpayer--many of whom are not wealthy--if we do not seek to recover the overpayment.

I believe that the Bill as it stands strikes a fair balance between the person claiming benefit and the taxpayer. Even when it is decided by an adjudication officer that an overpayment is recoverable--and there is a right of appeal against such a decision--the Secretary of State can, and does, exercise his discretion where serious hardship would be caused and can waive in whole or in part his right to recover the overpayment.

I hope that, with that explanation and the assurance that the Secretary of State has a discretion which he can exercise where there will be serious hardship, the noble Earl will feel able to withdraw his amendment.

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