14 January 1998
By the Select Committee
appointed to report whether the provisions of any bill inappropriately
delegate legislative power, or whether they subject the exercise
of legislative power to an inappropriate degree of parliamentary
scrutiny; to report on documents laid before Parliament under
section 3(3) of the Deregulation and Contracting Out Act 1994
and on draft orders laid under section 1(4) of that Act; and to
perform, in respect of such documents and orders, the functions
performed in respect of other instruments by the Joint Committee
on Statutory Instruments.
1. This is a major
bill which contains some controversial provisions and it is these,
rather than the delegated powers, which will attract most attention.
There is, however, a large number of delegated powers in the bill.
In particular, Part I of the bill aims to set in place a framework
for decision-making, rights of appeal and new appeals arrangements.
It makes provision for the simplification of decision-making and
appeals in social security, child support and vaccine damage payments
cases. Existing statutory arrangements are repealed and replaced
by a series of regulation-making powers. The bill constitutes
an overhauling of much of the Social Security system, and the
consequence is that arrangements which are well known and seen
as fair will come to an end. For this reason it is important to
consider in some detail the regulation-making powers which will
result in new, and as yet untested, arrangements.
2. The Department's
exceptionally helpful explanatory memorandum, which lists the
powers and explains the background to the changes made by the
bill, states that within the framework established by Part I of
the bill "it is intended that the detail will be set out
in regulations and guidance". For this reason the Committee
has scrutinised the aspects of the bill relating to tribunals
and rights of appeal with special care; the House may also wish
to examine these provisions in similar detail at Committee stage.
3. The Committee
received written evidence on this bill from the Child Poverty
Action Group (CPAG) and from the National Association of Citizens
Advice Bureaux (NACAB). The Committee is grateful to these two
organisations for alerting it promptly to the delegated powers
in the bill which caused them concern; both the memoranda are
printed in the annex to this report. CPAG support NACAB's comments
and add some comments on other provisions of the bill. We do not
refer to all these additional comments in this report as we regard
them as requests for information about the way it is intended
to use powers and we have no concerns about those powers to draw
to the attention of the House. We do not discuss all the many
powers but only those which we found to raise issues which caused
4. The bill contains
no Henry VIII powers. Apart from the commencement power and one
power subject to affirmative procedure, all powers are subject
to negative procedure.
Legally qualified chairmen
and "sifting" appeals
5. Clause 6 provides
for the Lord Chancellor to constitute a panel of persons to act
as members of appeal tribunals. Subsection (3) provides that the
panel shall include persons possessing such qualifications as
may be prescribed by regulation made by the Secretary of State
with the concurrence of the Lord Chancellor. At present there
is a statutory requirement that the chairman of an appeal tribunal
should be legally qualified. The Minister in charge of the bill
in the Commons told the Commons Standing Committee that some appeals
would require a legally qualified chairman but such a requirement
was not suitable for inclusion in primary legislation. NACAB question
whether it is wise to leave so important a matter to subordinate
legislation, and comment in the same terms on the equivalent provision
for Scotland (clause 7). Regulations under clauses 6 and 7 do
not require the lists of those eligible to serve on appeal tribunals
to include amongst the qualifications an appropriate legal qualification.
In the Committee's view, however, it is inconceivable that an
appropriate legal qualification should not be included within
6. The Committee
regards clause 8 - constitution of appeal tribunals - as a far
greater cause for concern. This clause replaces the existing requirement
in sections 41, 43 and 50 of the Social Security Administration
Act for all appeals to be heard by three-person tribunals with
provision for one, two or three-member tribunals. This is an important
change, and the Department's explanatory memorandum (paragraphs
26-33) explains the Government's intentions for the composition
of tribunals. The memorandum (paragraph 29) explains, for example,
that an appeal on a child support maintenance assessment will
always go to a tribunal including a legally-qualified panel member
(who will be appointed chairman if the tribunal consists of more
than one member), as such cases often raise complex legal issues.
There is, however, nothing in the bill about the qualifications
of the person from the panel who is to take the chair. That could
be the subject of a regulation under clause 8(3). For the past
two decades there has been a requirement that the chairman of
an appeal tribunal should be legally qualified, and the provision
in this bill that Ministers will have discretion in this matter
is thus a considerable change.
7. Clause 8(3)(c)
allows regulations to lay down "the procedure to be followed
in allocating cases among differently constituted tribunals".
NACAB see that as allowing administrators to label an appeal as
"hopeless" and so send it to "a tribunal of one
person untrained in law" whereas at present tribunals are
of three members with a legally qualified chairman. The Secretary
of State may have that intention and may regard troubling three
persons with a hopeless case as an extravagant use of resources.
8. In this context
it is necessary to refer to Schedule 1 which is dependent on clause
8. Paragraph 11 allows regulations to delegate certain functions
of appeal tribunals to officers authorised by the Secretary of
State. Paragraph 11(2) makes it clear that regulations may allow
officers to make "determinations that would have the effect
of preventing an appeal, application for leave to appeal or reference
being determined by an appeal tribunal". NACAB see this as
another example of the need for "a tightening of the drafting
.... to strike an appropriate balance between the DSS's
need for flexibility and the claimant's right to be protected
from arbitrary power".
9. There are
thus some major causes for concern about the provisions in clause
8. The House may therefore consider that clause 8 (and with it
paragraph 11 of Schedule 1) raises issues of such importance that
affirmative procedure would be appropriate. In the Committee's
view, that would provide sufficient protection against the possible
dangers in these provisions.
Decisions superseding earlier
10. Clause 11 gives
the Secretary of State power to make a decision which supersedes
one made under Clauses 9 and 10 of the bill, other than discretionary
Social Fund decisions, or one made by an appeal tribunal or Commissioner.
A new decision may be made in response to an application or at
the Secretary of State's own initiative. These powers may seem
wide, but the explanatory memorandum (paragraph 52) explains that
they will be used for only two limited purposes. Provided that
the Minister is prepared to give an undertaking to this effect,
the Committee therefore considers that negative procedure is appropriate.
Withdrawing right of appeal
11. Clause 13(2)
allows the Secretary of State to prescribe by regulation circumstances
in which the general language of the clause is not to confer a
right of appeal. NACAB see this as an unqualified power to withdraw
the right of appeal. At a first glance, the power seems wide-ranging,
but the memorandum (paragraph 63) explains that this power complements
the power in paragraph 8 of Schedule 1 and that the aim is to
"put beyond doubt, if this should become necessary, that
individuals have no right of appeal on matters other than claims
and awards, or those decisions covered by Schedule 3, in the event
of future developments in the benefits system" and to ensure
that rights of appeal are not given in respect of decisions on
administrative matters where no right of appeal currently exists.
The Department's memorandum expands on this in paragraph 71 which
makes it clear that there is no intention to remove rights of
appeal in respect of "outcome" decisions but only to
prevent appeals on "peripheral issues" (such as the
day of the week on which benefit is to be paid).
12. The Committee
sees no objection to the grant of the powers to be used in the
way proposed. It is, however, concerned at their apparent width.
The joint effect of clause 13(2) and paragraph 8 of Schedule 2
is to allow any right of appeal relating to an "outcome"
decision to be extinguished.
13. The Committee
does not consider that affirmative procedure is the appropriate
answer to its concerns about clause 13(2) (and the corresponding
provision in paragraph 8 of Schedule 2). It is arguable that primary
legislation should establish the essential rights of appeal in
any area of the law. The Committee sees no objection to a power
to confer additional rights of appeal (as in paragraphs 9 and
28 of Schedule 3). But as the bill stands there are no rights
of appeal which could not be removed by regulations under clause
13(2) or paragraph 8 of Schedule 2. The Committee wishes to draw
attention to this point, and invites the House to consider whether
it is right that Ministers should have so wide a power to deny
appeals from their own decisions. The House may consider that
the remedy is to amend the bill to list the "current"
outcome decisions which are appealable and to exclude these from
the operation of power to deny rights of appeal: the power to
confer additional rights of appeal would stay as proposed in the
Suspension of payments pending
14. Clause 22 allows
regulations to provide for suspending payments of benefit in prescribed
circumstances. One example is suspension while an appeal is pending
in that case (clause 22 (2)(c)) or in a parallel case (clause
22 (2)(d)). There is a similar power to suspend payments of housing
benefit or council tax benefit (clause 35). The House will no
doubt wish to debate this clause with care, but it can be argued
that the point of principle will be decided by the provisions
of the primary legislation and the regulation-making power does
not raise additional issues. If concerns expressed about this
clause are not satisfied in debate then the House may wish to
consider whether this power should be subject to affirmative procedure.
15. This clause
is mentioned here only because it contains the sole provision
for affirmative procedure in the bill. The clause confers power
to alter the percentage rates of Class 1B contributions and in
the Committee's view affirmative procedure is appropriate.
Power to reduce child benefit
for lone parents
16. Clause 70 enables
regulations to be made to provide for lone parents to receive
the same rate of child benefit for their eldest child as couples
with children. The explanatory memorandum explains that this provision
is necessary because section 145(4) of the Social Security Contributions
and Benefits Act 1992 specifically prevents regulations from reducing
an existing rate of child benefit. This is an exceptionally controversial
provision, and there has been considerable debate as to how it
will work in practice. Given the great significance of this
power, the House may wish to consider whether the bill should
be amended to allow for the affirmative resolution procedure.
17. This schedule
confers power to make regulations about the procedure to be followed
in connection with decisions of the Secretary of State, a Commissioner
or an appeal tribunal. Paragraph 3 allows regulations to make
provision as to the striking out of proceedings. NACAB state that
this is a dangerous change from the present position where the
only circumstances where proceedings can be struck out is where
the Independent Tribunal Service finds that there has been "want
of prosecution". The Department's memorandum discusses this
power and gives examples of how it would be used, arguing that
"the level of technical detail" involved in defining
these additional categories "makes this suitable for secondary
legislation". This may be so, but "striking out"
is a draconian process which denies the claimant access to a hearing.
So the House may wish to consider whether affirmative procedure
is needed to ensure that the power will only be used to allow
"striking out" in cases where there would be general
agreement that use of such a power would be appropriate.
18. NACAB also
question paragraph 5 of this Schedule which allows regulations
to establish time limits for producing evidence or making any
application, reference or appeal, and they contrast this with
clause 72 which fixes time limits for the backdating of benefits.
The clause is dealing with a very different matter and in the
Committee's view the unease about this particular point does not
appear to be justified. The prescription in subordinate legislation
of time limits for proceedings in court or before tribunals is
19. There is
an exceptionally large number of delegated powers in this bill,
and it is difficult to strike the right balance in relation to
some of these powers. The Committee is conscious of the need to
allow flexibility, and has therefore limited its comments to those
delegated powers which it regards as being of exceptional importance.
Some of the delegated powers in the bill break important new ground,
and whilst there is no reason to question Ministers' intentions,
there can also be no guarantee that the powers will always be
used as is currently proposed. The House may therefore wish to
consider whether affirmative procedure is needed for regulations
made under clauses 8 and 70, paragraph 11 of Schedule 1 and paragraph
3 of Schedule 5. In the case of the provision in clause 13(2)
withdrawing the right of appeal, and the corresponding provision
in paragraph 8 of Schedule 2, in the Committee's view even the
affirmative procedure would not give the certainty required. The
House may therefore wish to consider amending the bill to put
the vital provisions in the bill itself and to limit the powers
20. There is nothing
else in the bill to which the House's attention need be drawn.
1 Department of Social Security. Back