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Page 12, line 45, at end insert--
("(1A) Regulations under subsection (1)(a) above shall in particular authorise the Secretary of State to make a payment on account of a relevant benefit pending any decision referred to in that subsection and shall require him when he is considering whether to make such a payment to take account of the hardship that any person is likely to suffer if a payment is not made.
(1B) In making the provision referred to in subsection (1A), regulations shall not circumscribe the circumstances in which a payment on account may be made (other than that a decision referred to in subsection (1A) above is pending) but they may make provision requiring a claimant to agree to repay the payment in prescribed circumstances as a condition for making the payment.
(1C) In making such provision, regulations shall provide that, where the Secretary of State declines to make a payment on account, a claimant may appeal to an appeal tribunal against the refusal and that such an appeal shall in prescribed circumstances be determined expeditiously.").

The noble Earl said: The effect of the amendment would be to give the Minister the right to allow payments on account pending appeal where severe hardship might result if that were not done. Its effect would be to restore the law to what it was before 5th February 1996. Both the Minister and I, having been involved in the Asylum and Immigration Bill, will, I think, remember other significance in that date. This may not possibly be coincidental.

We have had recently a considerable number of regulations under which people can be denied benefit entirely. That in itself is one injustice. But to deny people benefit entirely, and then to find, when there was an appeal, that you did not have the legal entitlement to do so, is a double injustice. In those original asylum regulations--I am sure that the Minister and I remember them extremely well--there was a provision to pay the benefit after appeal if they were subsequently found to be entitled. But this is in danger of becoming somewhat like a posthumous VC. One is not in any position to enjoy it. Where there is a total disentitlement to benefit, the only options really are starvation or going underground in some illicit capacity. Therefore it can be important to have an entitlement to benefit pending the final resolution of whether one has a right to it.

We shall return to the issue in debates on Clauses 25, 26 and 27, where we shall be getting a large number of cases held up pending resolution of the test case. To do that without giving people the right to have anything to live on in the interim can be a very harsh measure indeed. This is a benefit of the doubt amendment; and where life itself may be at stake I should have thought that the benefit of the doubt is not too much to ask. I beg to move.

Baroness Hollis of Heigham: This amendment would provide for regulations to be made authorising the Secretary of State to make interim payments, taking account of any hardship that might otherwise result, where a decision of the Secretary of State, an appeal tribunal or a commissioner is pending. The amendment provides for such payments to be recoverable and gives a right of appeal against a refusal to make an award.

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Our intention is that current provision for interim payments in Regulation 2 of the Payments on Account, Overpayment and Recoupment Regulations (made under Section 5 of the Administration Act) will remain in force under the new decision-making and appeals arrangements. Payments on account, or interim payments as they are otherwise known, can be paid before a final decision on benefit entitlement has been reached where the Secretary of State has reason to believe that there is, or may be, entitlement to the benefit in question.

These payments are recoverable either from benefit, if eventually awarded, or from other income if benefit is not awarded. They are intended to provide an immediate source of income where entitlement is possible but there is a delay in making a claim in accordance with the claims and payments regulations, making a decision or making the right payment, for administrative or practical reasons--for example, in a case where the department believes that there is clear entitlement to benefit, but there is no time to go through the formal claims process because it is Friday afternoon and the claimant is in urgent need.

There are currently no appeal rights against a refusal to make an interim payment, and we do not propose to introduce them. This is because it is almost always the case that the initial question is resolved well before an appeal against the refusal to award an interim payment could be heard. And, of course, the customer has the usual right of appeal against the decision on full benefit entitlement, when that is taken.

Interim payments were only ever intended to be made, as an emergency measure, where proper benefit entitlement could not be established under the normal statutory provisions because of administrative difficulties.

It has never been the intention that interim payments should be made where a claim has been properly determined, but is under appeal. This would be to circumvent the normal rules on benefit entitlement as established by legislation approved by Parliament. It would mean making payments to customers who have no entitlement to benefit under the statutory provisions. The Secretary of State would make payments to the very people who she has already decided are not entitled.

The noble Earl, Lord Russell, has argued that any interim payment could be recovered. However, in practice it would be extremely difficult to recover any payments made, especially where the eventual outcome was that there was no entitlement to benefit. We would be in the position of having made payments to claimants many of whom turn out to have no statutory entitlement to benefit. In such circumstances, the chances of ever recovering the amounts paid out would be minimal. The practicalities and the administrative costs of attempting to pursue such overpayments and the recovery of them in these cases would be prohibitive.

I hope that I have been able to explain that there is already adequate provision for the making of interim payments where administrative difficulties prevent a

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final decision being made. I therefore hope, in view of this explanation, that the noble Earl, Lord Russell, will feel able to withdraw the amendment.

Earl Russell: I cannot help feeling that was a rather self-satisfied reply. The department, like the servant in the open testimonial, is saying that it has carried out its duties entirely to its own satisfaction.

Before deciding whether we need to come back to this at another stage, I should like to probe some of the words which the Minister has used as taken from the existing regulations. The noble Baroness said that benefit is payable only where the Secretary of State is satisfied that there is or may be an entitlement. Everything seems to me to hang on the interpretation of the words "or may be". According to a strict and narrow interpretation--I suspect that that is the one the department is using--the Secretary of State would under those words require to have good ground for believing that there may be a legal entitlement. There would have to be a strong degree of probability.

However, according to the other interpretation, which relies on possibility rather than probability, the mere fact that the case has gone to appeal--and judgments on appeal are well known to be capable of going either way--would indicate that, just because the judgment is uncertain, therefore there may be an entitlement. That would be rather more plausible.

We must accept that if there are to be appeals there must be rules for what is done pending those appeals and that those rules, since we do not know what the result of the appeal will be, are bound to involve the possibility of injustice to one side or the other. Whichever side is given the benefit of the doubt, it may be that the judgment will go against it.

I take the Minister's point about the difficulty of recovery. However, that seems to me to be saying that recovery will be perfectly possible where the payment on account was not necessary; but where it was necessary, and where in fact the person would otherwise have starved, recovery will be extremely difficult. It therefore seems to me to be a provision that would catch the guilty and spare the comparatively innocent.

It is a question of which risk we are prepared to take. The Minister knows, as well as I do, that when people have been unjustly denied benefit, sometimes over quite a period of time, there has been a multiplication of further hardships--such as, very often, eviction from their house. That leads to difficulty in finding further employment. It therefore leads to a loss of future revenue for the Treasury, which loses, just like everyone else. Since somebody has to lose whichever way we handle the question of payment of benefit pending appeal, the body that takes the risk should properly be the one that is better able to bear it. When I ask which is better able to bear a financial loss--Her Majesty's Treasury or an individual claimant with no other visible means of support--the answer does not appear that difficult.

It is the basic function of social security to make sure that people are not cast into utter destitution. That is in the public interest, since, if they are, they tend to

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become unemployable in future. It deprives the Government of potentially useful tax-paying subjects. In the light of that, I cannot help wondering whether we have really got this one the wrong way round, and whether it really ought to be the Government who are taking the risk during the period when the case goes to appeal. I look forward to hearing the Minister's reply.

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