Previous Section Back to Table of Contents Lords Hansard Home Page

Earl Russell moved Amendment No. 77:

Page 17, line 33, after ("decision") insert ("on another case").

The noble Earl said: In moving this amendment, with the leave of the Committee, it might be convenient if I were to take with it the question that Clause 27 stand part. It is in the next group. One reason is that I would have to say at least three quarters of the same thing which does not seem a good idea. Another reason is that it will take me some time to work out exactly how many amendments in the group might be made redundant by the amendment just put forward by the noble and learned Lord the Lord Advocate. My impression is that it would make a number of them redundant, but probably not all of them. Since the issues involved are all quite technical, and since they are all interrelated, it might be as well to take them all together.

All of these issues relate to what is known colloquially as the anti-test case rule. The effect of that rule is: if there is a test case which establishes a principle in consequence of which it becomes clear that many other people have an entitlement to benefit, the entitlement to benefit goes back only to the time the case was decided, not to when they originally acquired what is now seen as the entitlement.

That rule is not new. It has been the subject of a good deal of litigation and parliamentary proceedings. It led to some drama in this Chamber during debate on the Social Security Bill in 1990, when, I regret to say, I disgraced myself by having the House count it out--which, I assure your Lordships, was not my intention.

I was quite relieved when that provision came before the Court of Appeal. Lord Justice Millett said that the Secretary of State's interpretation of the clause to which I had objected was "so unreasonable that Parliament could not possibly have intended it". The provision with which we were dealing in 1990, which tried to prevent the courts from upsetting the anti-test case rule, directed the courts to treat past judgments as if they had not been made. Lord Justice Millett said that that was an attempt, not so much to change the law, as to rewrite history.

So the question which is behind all this argument about the anti-test case rule is how we understand the concept of entitlement--whether, in fact, we accept the principle of Lord Justice Scarman that all social security law rests on the concept of entitlement, in which case the entitlement was there from the

2 Apr 1998 : Column 469

beginning; or whether we treat it as more a matter of grace and favour. The noble Baroness, Lady Anelay, touched very expertly on that issue.

I am, I must admit, on the entitlement side of this argument. I regard it as akin to the concept of a peerage in abeyance. It may be in abeyance--in one or two recent cases possibly as far back as the reign of Henry VII--but once the matter is resolved, it is clear that all the intervening generations were in fact Peers, even though that was not perceived by the Committee of Privileges of this House. Similarly, it might be argued that an entitlement is an entitlement, whether or not the courts have yet perceived it. The alternative interpretation has the effect, as it were, of suspending claimants from a sky-hook with no visible means of support. But since we dealt with that argument in relation to Clause 25, I do not need to enter into it again.

This Bill does not invent the anti-test case rule. What it does is to extend it from claims and reviews to appeal tribunals, social security commissioners and the courts. It extends that sort of control over the operation of the courts into a much higher area of the law, and therefore makes the possibility of collisions between the legislature and the courts rather more acute than before.

This string of amendments, beginning with Amendment No. 77, restricts the operation of Clause 27 so that it shall apply only to cases where, in consequence of a decision in the lead case, a person makes a new claim for benefit or applies for his case to be revised. I shall read Hansard carefully to see exactly how that fits with the remarks of the noble and learned Lord. It is a question that I cannot resolve on the sudden, but I am very interested in comparing the two matters together. It disapplies the anti-test case rule where a claim has been postponed under Clause 25 or the Secretary of State has revised or superseded a decision, exercising her powers under Clause 26. There again, I shall look with great care at the amendments the Minister has put forward. Again, it is not a decision I should want to make on the sudden. Or, it disapplies the anti-test case rule where the initial decisions on a lookalike case were made in accordance with the case law that was then binding. It disapplies them--that I did not hear in the noble and learned Lord's amendment--where the test case was made under regulations subsequently found to be ultra vires. If that were allowed, the Secretary of State would in effect be benefiting from her own poor decision-making, which would be, to say the least, undesirable.

On the other hand, clause stand part--which I confess I regard as the preferable option--would altogether stop these extensions of the anti-test case rule into the higher areas of jurisdiction. One of the amendments prevents the extension of the anti-test case rule to the European Court of Justice.

I listened with great interest to what the noble and learned Lord had to say about European law. I do not think I heard him say that he was stopping the extension of the anti-test case rule to the European Court of Justice. If I am mistaken, I apologise to him, but I did not hear it.

2 Apr 1998 : Column 470

It is doubtful whether Parliament has the power to bind the European Court of Justice. Indeed, it is more than doubtful; it seems to me in the very highest degree improbable that it has. The pillars of the European Court of Justice arise under the treaties; they do not arise from any Act of this Parliament. There is, I think, a very strong case for arguing that that is something which cannot actually be done. It raises the whole question on which the noble and learned Lord, Lord Slynn of Hadley, touched in his resolution of Bate's case, to which I referred earlier; whether the whole of this principle of the anti-test case rule is in fact compatible with European law at all. That is a question which has not yet been the subject of any judicial proceedings, and on which many doubts have been expressed--in this House, in the Court of Appeal and in the Appellate Committee of this House. It is one good reason why the anti-test case rule should be dropped altogether.

The noble and learned Lord will say that that will have a consequence for public funds. Indeed it will, and it is a matter that should be taken seriously. But one has to set two possible wrongs in balance against each other. Wherever any proceedings are pending, something has to be done pending their resolution. That something will be to the detriment of either one party or the other; there is no way that that can be avoided. I would have thought that there was a case for arguing that these things ought to be resolved in the interim period in the interests of the claimant, who is less able to bear the loss, rather than in the interests of the taxpayer, who is collectively rather better able to resolve the loss, and that the underlying principle which reconciles the two of them is that justice should not be unduly delayed, a principle of which I know the Government are perfectly well aware, as we all are. I beg to move.

Lord Hardie: These amendments, as the noble Earl observed, overlap considerably some of the amendments that we have just dealt with. I am pleased to say that the Government support the general thrust of the amendments that the noble Earl has brought forward, but we think and hope that we have addressed those concerns in the amendments to which I spoke a few moments ago.

Amendment No. 77 seeks to clarify that the provisions of the clause do not apply to the lead case. I can assure your Lordships that it was never the intention that the restrictions on arrears provided for in this clause should apply to that case. The provisions of the clause will apply to other cases to which the new interpretation of the law applies. Full arrears will be payable in the lead case. Accordingly, the amendment is unnecessary.

Amendment No. 80 seeks to ensure that the restrictions on arrears of benefit do not apply to decisions made in lookalike cases by an appeal tribunal, a commissioner or a court. The Government have been concerned that claimants should be entitled to an effective right of appeal against a decision of the Secretary of State, an appeal tribunal or a commissioner. As a result, we tabled Amendments Nos. 78, 79, 81 and 85 which will ensure that the provisions of the clause will apply only to decisions made by the Secretary of

2 Apr 1998 : Column 471

State. The government amendments will also ensure that the clause complies with obligations arising in EC law and the European Convention on Human Rights. Claimants will have an effective remedy against decisions.

Amendments Nos. 82 and 84 would allow unlimited arrears for people who happened to have applied for a revised decision or applied for a decision on their entitlement to be superseded before the date of the commissioner's or court's determination in the lead case. Claimants who did not apply for a revision or supersession before the relevant determination would have any award of, or increase in, benefit limited. This would lead to inconsistent and unfair treatment between claimants.

The proposed amendments would also have other implications. A significant period of time may have elapsed before a commissioner or a court reinterprets the law. Potential arrears of benefit may be considerable. For reasons I have already explained, it would not be appropriate to pay those arrears in cases where there was no outstanding claim prior to the decision in the lead case.

Amendment No. 83 proposes that a decision of the Secretary of State to revise a claimant's entitlement to benefit should be made in accordance with an earlier decision of a commissioner or court. However, the clause is drafted in such a way that the relevant determination must have been made in order for the Secretary of State to revise a decision. Therefore the amendment would appear to be unnecessary.

Amendment No. 86 seeks to remove paragraph 4 of the clause. Paragraph 4 puts beyond doubt that restrictions on arrears will also apply where the commissioner or court determines that regulations are invalid for the period before the relevant determination. As your Lordships will know, the Secretary of State makes regulations based on her understanding of the powers laid down by Parliament. If that power is misunderstood, there are well-established procedures for handling these cases, and the restrictions of Clause 27 will apply.

Amendment No. 88 seeks to exclude decisions of the European Court of Justice from the restriction of the clause. The Bill makes it clear that decisions of the European Court of Justice are determinations by a "court", so restrictions on arrears apply. It is not a new provision. The words are on the face of the Bill to clarify existing legislation. The amendment seeks to exempt these judgments and would result in potential unlimited backdating of arrears. It would be unfair to exempt the decisions of the European Court of Justice while maintaining that the restrictions apply to decisions of other courts.

Amendment No. 89 would remove the subsections of the clause which allow regulations to be made to prescribe how the date of the relevant determination shall be determined. The amendment would specify that only the first decision on an issue, made in the claimant's favour, will be a relevant determination. We intend to prescribe how the determination of a higher court is to be treated as if it had been made on the date of a determination of a lower court. For example, a commissioner may decide a case in one way, the Court of Appeal take an opposite

2 Apr 1998 : Column 472

view, and this House, sitting as the Judicial Committee, decide that the commissioner's interpretation is correct. The regulations would clarify that the date of the relevant determination would be that made by the commissioners. These regulations will apply equally when cases are determined in the Secretary of State's or the claimant's favour. The first decision made by a commissioner of the court which is subsequently confirmed by a higher authority will be the relevant determination subject to any further appeal. Therefore this amendment is unnecessary.

Amendment No. 90 proposes to insert a new subsection in the clause which will ensure that decisions made by the Secretary of State under Sections 25(4) and 26(3) or (5) are not subject to the restrictions of the clause. I hope that the noble Earl, Lord Russell, will be reassured to know that the Government have tabled amendments which we have already dealt with and which have addressed many, if not most, of his concerns in this area. I have already explained the amendments in full to the Committee and do not think it is necessary to repeat what I have said. In those circumstances I would invite the noble Earl to withdraw these amendments at this stage. He has of course indicated that he would wish to read specifically about the government amendments. In the light of that I would invite him to withdraw his amendments.

As far as clause stand part is concerned, I think I have effectively dealt with the thinking behind Clause 27 in part-outlining the Government's amendments when I spoke earlier. I would again invite the noble Earl to withdraw his opposition to that.

9.15 p.m.

Earl Russell: I thank the noble and learned Lord most warmly for that reply. I am sorry to have put him to the trouble of going through some of these things twice, but this is by way of being the Schleswig-Holstein of social security law, and at times I feel rather like its Lord Palmerston.

I think the noble and learned Lord has gone a very long way towards meeting what I was worried about in the amendments. I think it would be extremely unwise of me to reach any final decision tonight on whether he has met all or only part of my concerns. Certainly he has met a large part of them.

I was considerably reassured by a number of things that he said, although I am still, I must confess, a little concerned about the European Court of Justice. Clearly I shall not be pressing these amendments tonight but I shall be reading the answers carefully and deciding what to bring back.

On the basic thinking of Clause 27 itself, there is still a great deal that divides us, but granted that the noble and learned Lord still adheres to the basic framework of the clause, he may well have gone as far to meet me within that assumption as he could. I am in any case extremely grateful to him and beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

2 Apr 1998 : Column 473

Next Section Back to Table of Contents Lords Hansard Home Page