Clause 51: Additional Pension

The clause inserts a new section - section 48BB - into the Contributions and Benefits Act. This provides for the amount of Additional Pension (State Earnings Related Pension - SERPS) that widows and widowers should receive when they reach pensionable age, based on their spouses' contributions.

Background

Legislation is already in place to ensure that those who are widowed, whether men or women, are able to use "substitution" provisions to help them achieve a basic Retirement Pension if their own contribution record during the period of marriage is inferior to that of their spouse. Section 48 of the Contributions and Benefits Act provides for circumstances in which a former spouse's contributions can be treated as if they were those of the pensioner, and section 52 contains additional provision for surviving spouses.

Under the existing scheme, widows who receive Widowed Mother's Allowance or Widow's Pension are paid an amount of Additional Pension with their weekly benefit, based on their husbands' contribution records. This benefit continues until they reach pensionable age. They are then entitled to a "Category B" Retirement Pension (i.e. a pension based on their husband's National Insurance contributions) paid at the same level.

The new scheme is different, in that Bereavement Allowance is to be paid for 26 weeks only, and without any Additional Pension (see clause 50). So, unless they are still receiving Bereavement Allowance or Widowed Parent's Allowance when they reach pensionable age, future widows and widowers will have a period before retirement when they are not receiving any bereavement benefit or Additional Pension.

But the intention is that, once they do reach pensionable age, and provided they have not remarried, they should have the same amount of Category B Retirement Pension as if they had been receiving a benefit with Additional Pension continuously since their date of bereavement. That is to say, their Retirement Pension should be exactly the same as if they had been claiming under the current system. Therefore, this clause provides for the same entitlement rules, but by reference to the new bereavement benefits.

The inserted section 48BB

The inserted subsections (1) and (2) relate to widows and widowers who are still receiving Widowed Parent's Allowance when they reach pensionable age. The subsections entitle them to a Category B Retirement Pension, on the basis of their spouses' contributions, at the same weekly level as their Widowed Parent's Allowance.

The inserted subsections (3) and (4) relate to widows and widowers who were previously entitled to Bereavement Allowance or were aged over 45 when they stopped being entitled to Widowed Parent's Allowance. When they reach pensionable age, they will also be entitled to a Category B Retirement Pension on the basis of their spouses' contributions-calculated by the same rules as if they had been receiving Widow's Pension. The inserted subsections (5) to (8) provide these rules.

The inserted subsection (7) corresponds to the new section 39C(4) inserted by clause50 (above), and provides the 50% reduction in Additional Pension for cases where the spouse dies after 5th April 2000.

The inserted subsections (8) and (9) contain the same age-related calculation as new section 39C(5). They reduce the amount of Additional Pension by 7% for every year the bereaved spouse was aged below 55 either

when their spouse died and they became entitled to Bereavement Allowance; or

when they stopped being entitled to Widowed Parent's Allowance.

In both cases they must have been at least 45 years old to qualify (so the maximum reduction is by 10 years, or 70%).

The inserted subsection (10) raises the amount of Additional Pension to the same level as if it had been increased by the annual uprating order every year since the date of the spouse's death.

Schedule 8: Consequential amendments

Part I of Schedule 8 makes the necessary amendments to the Contributions and Benefits Act, the Administration Act, the Pensions Schemes Act 1993, and the Income and Corporation Taxes Act 1988, so that they refer correctly to the new bereavement benefits.

CLAUSES 52-53: WORK-FOCUSED INTERVIEWS

Clause 52: Work-focused interviews

This clause enables a "Single Work-Focused Gateway" into the benefit system to be set up. It does this by giving powers to require claimants of certain social security benefits to take part in work-focused interviews. It provides for the circumstances in which work-focused interviews may be required and sets out what will happen if people do not take part in the interviews.

Background

The measure will support plans to introduce a Single Work-Focused Gateway into the benefit system for people of working age who are not in full-time employment. These proposals were put forward in A new contract for welfare: THE GATEWAY TO WORK (Cm 4102), published in October 1998. The Single Work-Focused Gateway is intended to provide a more streamlined service, by providing claimants with a single point of contact for all of their benefit requirements.

After claimants make initial contact to supply basic information, such as the benefits to be claimed and other details relevant to the claim, they will be given a personal adviser. The adviser will carry out work-focused interviews with each individual: discussing job potential, and providing access to a range of help and information on work, benefits and services such as childcare. The Single Work-Focused Gateway will be piloted in twelve areas, starting in June 1999. The Government intends to market it under a more accessible name in the pilot areas. Before the powers in this clause come into force, taking part in interviews will be voluntary.

Most of the arrangements for operating the Single Work-Focused Gateway will be introduced using existing powers. There are already comprehensive powers to require those claiming Jobseeker's Allowance (who will make up the majority of claimants entering the gateway) to attend work-related interviews. However there are no general provisions to require people claiming any other benefit to have an interview about work. The powers in this clause will require individuals claiming certain other benefits to take part in work-focused interviews with a personal adviser as a condition of entitlement. The Gateway is intended to encourage claimants to take further steps towards labour market participation, but any action they take beyond taking part in interviews will be entirely voluntary. For example, they will not be required to attend training courses or seek work.

Commentary

Clause 52 inserts new sections 2A and 2B after section 2 of the Administration Act. All references in the commentary below are to these new sections.

Section 2A enables regulations to provide that a benefit claim will only be complete once the claimant takes part in a work-focused interview. Where benefit is already in payment, the claim can either be stopped, or the amount payable restricted, for failure to take part in an interview.

While the section allows for the detail of these requirements to be provided for in secondary legislation, the main ways in which it is expected to use these powers are clearly laid out in subsections (3) to (7). The reason for this approach is that there needs to be flexibility to adjust the various detailed aspects of the scheme in the light of experience gained during the operation of the pilot exercises.

The power itself

New claims to benefit will be made through the Single Work-Focused Gateway. As part of the claim process, claimants will take part in an interview with their personal adviser to discuss the barriers they face in moving closer to the labour market, and the help and support that is available to overcome those barriers. Where it is considered inappropriate for someone to discuss work-related issues at that time given the particular circumstances that they face (for example, the point of claim would not be an appropriate time to discuss work-related issues with a grieving widow), the interview could be deferred until a later date. Subsection (6)(c) enables this to be done. Therefore:

subsection (1)(a) provides regulation-making powers to require claimants of the benefits listed in subsection (2) to take part in a work-focused interview as part of the process of claiming those benefits.

In some cases, claimants will be asked to take part in interviews after benefit has been put into payment. This would happen on the occurrence of a specified event (a "trigger point") which could potentially affect someone's employability. These trigger points will be set out in regulations. They are likely to include: when the youngest child of a lone parent or widow reaches school age, or when the results from a Personal Capacity Assessment (see commentary on clause 56) become available. Also, interviews may be triggered where claimants have not had a work-focused interview for a specified period of time. Therefore,

subsection (1)(b) provides for regulations that will enable interviews to take place where one or more of the benefits listed in subsection (2) is already in payment. It also allows for the trigger points (see above) to be specified. Claimants who do not take part in these interviews when required to do so will have the amount of benefit in payment reduced (see subsections (4) and (5)). It is intended to exclude existing claimants from the requirement to take part in work-focused interviews in respect of those claims for the duration of the pilots. This position will be reviewed in light of the experience of the pilots.

Subsection (2) lists the benefits to which the requirements in subsection (1) will apply. In particular, subsection (2)(d) ensures that this provision will apply to the new benefits for widows and widowers introduced by clause 50 of this Bill. However, the Bereavement Payment (the proposed new lump sum payment which will replace the Widow's Payment) is excluded from the provisions of this section. Although claimants of Jobseeker's Allowance (JSA) will enter the Single Work-Focused Gateway, the benefit is not included in this subsection: powers already exist in the Jobseekers Act enabling regulations to require claimants to attend at specified offices. Such claimants are therefore already required to fulfil the requirements of a work-focused regime.

How the power would be used

Subsections (3) to (7) identify the main ways in which the regulation-making powers provided under subsection (1) might be used, in order to deliver the intention that claimants should take part in work-focused interviews in connection with their benefit claims.

Where a person is claiming or receiving a number of benefits at the same time (for example Income Support, Housing Benefit and Council Tax Benefit), it is not intended to ask them to take part in separate work-focused interviews for each benefit. Subsection (3)(a) allows for regulations to achieve this.

The Single Work-Focused Gateway aims to give claimants a more streamlined, integrated service, by offering a single point of contact for all of their benefit requirements. It will not matter who administers the benefits they claim: the Benefits Agency, the Employment Service or local authorities. This means that a work-focused interview may be conducted by a person acting on behalf of the Secretary of State (most commonly an employee of the Benefits Agency or the Employment Service), by a local authority employee, or by a private/voluntary sector organisation contracted to provide services. It is intended that the interview will usually be conducted at a range of easily accessible Benefits Agency, Employment Service or local authority premises. However, where claimants cannot reasonably be expected to visit an office, a home visit will be arranged. Therefore:

subsection (3)(b) enables the Secretary of State to prescribe who will conduct the interviews. Those prescribed are likely to be representatives of the Secretary of State, local authority employees or persons providing services to either.

Regulations under subsection (3)(c) will give those who conduct the interviews the power to determine where and when an interview will take place. This mirrors the provisions in section 8 of the Jobseekers Act.

The regulations under this section will impose a general requirement on claimants to take part in a work-focused interview. Claimants attending such interviews and the personal advisers who conduct them need to be clear about the criteria to be used in judging whether a person has actually taken part. Therefore:

subsection (3)(d) explains that regulations can set out the circumstances in which a person is to be treated as taking part in or not taking part in the interview. It is intended that the test of whether claimants have taken part will be:

whether they attend at the time and place specified; and

whether they provide information in areas relevant to their employment prospects, such as their level of educational qualifications, their previous work history, and any barriers to work they may face.

Where someone does not take part in an interview, this will affect their claim or the amount of benefit they receive (depending on when the failure to take part occurred), unless they can show 'good cause' for that failure. Good cause is a familiar concept in social security and is used, for example, in deciding whether people's entitlement to JSA should stop where they have not kept an appointment with a representative of the Secretary of State (section 8(1)(d) of the Jobseekers Act).

Subsection (3)(e) enables regulations to provide that if a person is requested to take part in an interview but does not do so then, unless he can show good cause within the prescribed period, subsection (4) (which deals with the consequences of failure) will apply.

Subsection (3)(f) enables regulations to specify what constitutes good cause for not taking part in an interview. Examples might be when someone had an accident on the day set for the interview or where their child fell ill or where they misunderstood the requirements placed upon them because of any language or literacy difficulties.

Subsection (4) deals with the consequences if a claimant does not take part in a work-focused interview when asked to do so.

Subsection (4)(a) deals with the initial work-focused interview that takes place at the point of claim or, where the interview is deferred, after benefit has been put into payment. If a person does not take part in an interview at the point of claim, they will be regarded as not having completed the claims process. Any claim for benefit will therefore not proceed. Where there is a failure to take part in a deferred initial interview, that is, after benefit has been put into payment, the award will be terminated and benefit withdrawn.

Subsection (4)(b) deals with the circumstances where entitlement already exists and a further work-focused interview is triggered under subsection (1)(b). If a person does not take part in such an interview, regulations may provide for the amount of their benefit to be reduced. The reduction will apply until such time as the claimant fulfils the requirement to take part in the interview.

Subsection (5) links to subsection (4)(b), in that it deals with how any reduction in the amount of benefit payable should be calculated and applied.

Subsection (5)(a) gives the power to specify how the amount of the reduction will normally be calculated.

Subsection (5)(b) enables the regulations to allow the normal deduction to be set at a lesser amount in prescribed circumstances. This power will be used where the amount of the reduction would otherwise be greater than the amount of benefit. In addition, it is the intention to ensure that the claimant retains entitlement to a nominal amount of each benefit, to prevent the claim from lapsing and, where appropriate, to ensure that entitlement to any "passported" benefits (such as free NHS Prescriptions, free school meals) is retained.

Subsection (5)(c) allows regulations to specify that if the individual is claiming more than one benefit, the reduction may be applied to more than one of the benefits; but the total reduction must not exceed the amount calculated under subsection (5)(a). The regulations will also prioritise the benefits against which the reduction is to be applied. It is expected that Housing Benefit will be the last benefit to which sanctions should be applied, given its specific role in covering essential housing costs. Since the Single Work-Focused Gateway places an obligation only on those claiming benefits included in subsection (2), no sanctions will be applied against any benefit not included within this section.

There will be certain people for whom a work-focused interview will not be appropriate. Subsection (6) enables regulations to prescribe the circumstances in which the requirement to take part in a work-focused interview is not to be applied. It also ensures that the "designated authority" (i.e. a representative of the Secretary of State, a local authority employee or a person providing services to either) has the power to waive or defer the interview where appropriate. It is not the Government's intention to set out in regulations the categories of people for whom waiver or deferral of the requirement would be appropriate. Such decisions will be made on a case-by-case basis by reference to the circumstances of the individual claimant. Regulations will also set out that where a person has their interview waived or deferred, they will be treated, for the purposes of their claim to benefit, as having complied with the requirement.

Subsection (6)(a) enables regulations to specify circumstances in which the requirement to take part in a work-focused interview will be disapplied: either permanently or until a specified time. It is intended that this power will be used to exempt groups of people who are claiming the benefits listed in subsection(2) but to whom the requirement should not apply. For example, people of pension age who are claiming any of the benefits listed in subsection(2), or Housing Benefit and Council Tax Benefit claimants who are already in full-time employment.

Subsection (6)(b) enables the 'designated authority' to decide that the requirement to take part in a work-focused interview (either as part of a claim to benefit or where entitlement already exists) should be removed where it would not be of assistance to that person, or appropriate in their particular circumstances. Regulations will not specify which groups should have the requirement waived although examples of this might be where a terminally ill person claimed benefit, or where a person had already had a series of voluntary interviews immediately before the occurrence of a "trigger point" (see note on subsection (1)(b), above). Where an interview at the point of claim is either waived or deferred (see subsection (6)(c)), the claim will be treated as made, despite the fact that there has been no interview; where entitlement already exists, no change will be made to the amount of benefit in payment.

Subsection (6)(c) enables the "designated authority" to decide that the requirement to take part in a work-focused interview should be deferred if it is determined that an interview would not be of assistance, or appropriate, at that particular time. Examples might include a person in the early stages of recovery from a major operation, or a lone parent who had just given birth.

Subsection (7) makes clear that, where the initial interview is deferred from the point of claim until a later date, regulations may provide that the interview is to take place after benefit has been put into payment.

Subsection (8) defines terms used throughout the clause:

A "work-focused interview" is the interview that almost all claimants will be asked to take part in, either as part of the process of making a claim, or after the benefit has been put into payment. The purpose of such an interview is to assist or encourage claimants to improve their employment prospects over time, and to identify and take steps to overcome the barriers to work they face through training and specialist support; so that, where appropriate, they can move towards sustainable employment. To this end, an interview may cover such areas as previous employment record, capacity to undertake work, the in-work financial support which is available and help in areas such as childcare, housing and training.

Supplementary provisions

Section 2B makes further provision as to how the power in section 2A will be used.

Subsection (1) enables regulations to give claimants a right of appeal (under section 12 of the Social Security Act 1998) against:

decisions that they have not taken part in a work-focused interview;

decisions that they have not shown good cause for not taking part; and

decisions to stop their claim or reduce their benefit on the grounds that they did not take part.

Subsection (2) enables regulations to provide that decisions taken by, or on behalf of, local authorities may be treated, for the purpose of appeal rights, as made by the Secretary of State under section 8 of the Social Security Act 1998. In practice, this means that all decisions, whether made by a representative of the Secretary of State or a local authority employee, will be treated in the same way: all claimants will have a right of appeal to an independent appeal tribunal against these decisions.

Subsection (3) extends the definition of "information relating to social security" to include information supplied as part of a work-focused interview (which might, for example, include such subjects as a person's previous employment record and capacity to work). The intention is to ensure that information gathered about a client's employability can be passed on to their personal adviser. The extended definition applies to:

section 3 of the Social Security Act 1998 (which allows information relating to social security, child support or war pensions to be exchanged and used for any of those purposes); and to

clause 67 of this Bill, which provides a framework for the use or supply of the information that underpins a number of social security and employment-related activities, including the Single Work-Focused Gateway is one. See the commentary on clause 67 for further details.

Clause 53: Optional work-focused interviews

This clause gives regulation-making powers that will enable new functions to be conferred on local authorities enabling them to undertake a range of job-related activities with claimants. This will allow local authorities to support the introduction of the Single Work-Focused Gateway into the benefits system (see clause 52 above).

Local authorities currently have statutory responsibility for administering Housing Benefit and Council Tax Benefit. Under existing legislation, local authority staff can undertake activities and collect information only where it is relevant to the administration of those particular benefits. Various clauses in this Bill extend the functions of local authorities to allow them to play a full and active part in the Single Work-Focused Gateway process: for example, regulations under clause 66 will enable local authorities to accept claims and collect information for other benefits. Regulations under clause 67 will enable local authorities to use and disclose information about people's employability.

In addition, regulations under clause 52 (which will come into effect in April 2000) will make it a condition of entitlement that claimants of certain benefits (including Housing Benefit and Council Tax Benefit) take part in work-focused interviews - both at the point of claim and at various points afterwards. Clause 52 will also allow local authority staff to conduct these compulsory work-focused interviews.

However, all Single Work-Focused Gateway staff, including those working for local authorities, will also need to undertake voluntary work-related activities with claimants throughout the duration of the pilots.

The Gateway will be piloted in twelve areas, starting for those making new claims to benefit from the end of June 1999. For those making claims before the powers in clause 52 come into force, taking part in this initiative, and having work-focused interviews with a personal adviser, will be voluntary on their part

Once clause 52 does come into effect, claimants will be required to take part in compulsory work-focused interviews in specified circumstances. However, the purpose of these compulsory interviews is to encourage claimants to take further action, including participation in additional, voluntary interviews to improve their job prospects

Clause 53 extends the statutory functions of local authorities to allow them to perform these functions. This enables local authorities to play a full and active role in the operation of this initiative, allowing them to provide appropriate support to those making claims to benefit both before and after the start of the compulsory phase in April 2000.

The Bill also enables local authorities to be paid for this extra work (Schedule 12, paragraph 72). See the commentary after clause 66 for details.

Commentary

Clause 53 inserts a new section 2C after section 2B of the Administration Act (itself inserted by clause 52). Section 2C enables regulations to be made to confer additional functions on local authorities in prescribed areas to allow them to undertake job-related activities, including work-focused interviews, where claimants of certain benefits request or consent to such support.

Subsection (1) provides a power to make regulations to confer functions on local authorities in connection with conducting optional work-focused interviews. The main functions, in addition to the work-focused interview itself, are set out in subsection(3).

Subsection (2) enables local authorities to provide such assistance to people making claims, or entitled to, prescribed benefits. The Single Work-Focused Gateway pilots are intended to apply primarily to those making claims to the benefits introduced by section 2A(2) of clause 52. It also makes clear that the provisions can apply even where compulsory interviews under clause 52 have taken place.

Subsection (3) specifies the main functions in connection with conducting work-focused interviews that will be conferred on local authorities under subsection (1). These will enable local authorities to ask for and receive information and evidence in connection with the interviews, including information about current and future employment or training needs. It will also enable local authorities to undertake jobsearch activity on the claimant's behalf.

Subsection (4) enables regulations under this section to make different provisions in different areas across the country. It is the intention that, initially, the regulations will confer these additional functions only on those local authorities within the twelve pilot areas.

Subsection (5) defines "work-focused interview" and mirrors the definition of this term in clause 52.

CLAUSES 54-55: JOBSEEKER'S ALLOWANCE

Clause 54 and Schedule 7: Joint claims for Jobseeker's Allowance

This clause introduces Schedule 7, which provides for certain couples to claim income-based Jobseeker's Allowance (JSA) jointly (rather than one person claiming it on behalf of the couple, as happens now).

The intention is to give both partners the same opportunity to receive help and guidance to return to work and to go onto employment programmes including the New Deal for Young People.