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Lord Goodhart: I am extremely grateful to the noble Baroness for that explanation. I am also grateful for the support that Amendment No. 14 has received from all parts of the Committee. I apologise to the noble Baroness, Lady Lockwood, for being too quick off the mark and not quite appreciating the direction in which she was moving.

I welcome the movement that the Minister has made on this issue as far as it goes. It does not, however, remove my concerns on this matter. The noble Baroness has set out extremely clearly what the position will be, and that will be reported in tomorrow's Hansard.

Unfortunately, members of the public who are potential recipients of WFTC will not, in all probability, have the opportunity of reading what the Minister has said. While what she has said is satisfactory, in my view it must also be made clear to those who need to know what their rights are. That is why it is extremely important that the claim form and explanatory leaflet, or at least one of them, should express, as clearly as the noble Lady expressed it tonight, what the rights of the caring member of the couple are in the event of a dispute. Those rights are not adequately explained now. It is unfortunate that we will not have an opportunity to see the claim form or leaflet of instruction until after the Bill has become law. We cannot therefore know, when deciding whether or not to pass amendments, what that claim form will be.

I was by no means persuaded of the Government's reasons for not including any provision dealing with default on the face of the Bill. It is very unsatisfactory that a matter of principle of this kind should be dealt with by the administrative practice of the Inland Revenue and not provided for on the face of the regulations. I am not suggesting that it should be included in the Bill because undoubtedly the regulations would be a better place to include it, but we do not have the regulations.

I am extremely doubtful whether the care and management powers of the Inland Revenue would extend to treating as a settled practice something which could and should be stated on the face of the regulations. My mind would be very much more at ease if the noble Baroness were to seek legal advice on whether the care and management powers of the Inland Revenue enable it to do what she proposes. That advice could then be explained to noble Lords at Report.

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Obviously, one does not wish to divide the House late at night.

Baroness Hollis of Heigham: I understand that this matter has been worked through with the Solicitor to the Inland Revenue, so legal advice has indeed been taken to sustain the position I have outlined on care and management.

Lord Higgins: I should like to make the same point as the noble Lord, Lord Goodhart: it should be the Law Officers who provide the advice.

Lord Goodhart: I should like to see some advice that has come from outside the department. I agree with the noble Lord, Lord Higgins, that there should be appropriate advice from the Law Officers or some independent counsel instructed by them. I would be very much happier if, when we come back at Report--and I shall be putting this amendment down at Report--we could see the independent advice on the validity of what is proposed before I decide whether or not to seek to divide the House at Report stage. Obviously, tonight is not the appropriate occasion to divide the House, and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 3 agreed to.

10 p.m.

Clause 4 [Special provision for certain contacts]:

On Question, Whether Clause 4 shall stand part of the Bill?

Lord Higgins: This is probing in the strict sense of the word. The Minister has been helpful both in responding after Second Reading and in arranging meetings with officials to discuss specific points.

I have a recollection that at some stage in our discussions with officials a particular issue arose on this clause which I had not immediately perceived. Am I right in thinking that there is no ramification which is not apparent on the face of the clause?

Baroness Hollis of Heigham: I think that the noble Lord is saying that he put down the amendment, he cannot remember why he did so, and will I please tell him. In that case, I cannot help him because I believe that the Bill is a model of clarity.

Lord Higgins: I have no wish to press the matter further.

Clause 4 agreed to.

Lord Rix moved Amendment No. 15:

Before Clause 5, insert the following new clause--

Functions of Board: Disabled Person's Tax Credit-Review of Entitlement

(" . The Board shall conduct a review every two years of entitlement to the disabled person's tax credit and issue recommendations to the Secretary of State.")

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The noble Lord said: Before I speak to the amendment, perhaps I may pay tribute to my noble friend Lady Darcy de Knayth. Even at this late hour, and with all the problems she may well have in arriving at your Lordships' House, she always remains to speak to any amendments concerned with disability. She is a superb example of what can be done by a disabled person on behalf of disabled people and I should like to pay her every tribute in that respect.

This is a general amendment. It is not dissimilar to Amendment No. 63, which will be moved by the noble Lord, Lord Freeman. It asks the board to review the eligibility criteria for the disabled person's tax credit at least every two years, and makes recommendations known to the Secretary of State. I believe that that should be on the face of the Bill because a formal system of monitoring will help with the efficiency and effectiveness of the scheme.

The Minister explained that she expects take-up of the disabled person's tax credit to double compared with take-up of the disability working allowance. I am pleased with that level of expectation. However, the noble Baroness does not say over what period of time, so I believe that careful monitoring is essential.

What differentiates my amendment from that of the noble Lord, Lord Freeman, is that I also request the Government to re-evaluate their policy, in particular with regard to eligibility criteria. The Government should not leave unchecked the predicament of those who move from welfare to work only to find that loss of housing benefit means the loss of up to 96p of every pound earned. I also urge Ministers to consider again the policy of including family income in the tax credit means test. As I mentioned at Second Reading, I believe that the disabled person's tax credit should go some way to compensate for the employment limiting effects of the individual's disability and should not be viewed as an alternative way of supporting family income. I beg to move.

Baroness Darcy de Knayth: I warmly support my noble friend's amendment. First, I thank him for the eulogy, but point out that I am a night owl. If he wanted me to turn up early in the morning for a meeting I would not be half as reliable.

A serious evaluation of the scheme would be welcome by the employers concerned and by disabled people. I have one question for the Minister to answer and I hope that her reply will be helpful and encouraging to my noble friend. Does she expect the Disability Rights Commission to have a part in monitoring the performance of DPTC and the effect of other benefit changes in supporting disabled people?

Baroness Hollis of Heigham: The amendment seeks to specify that the Board of Inland Revenue should carry out a review into entitlement to DPTC every two years. I have every sympathy with the sentiments behind the amendment. The Government believe that DPTC will provide much needed help and work incentives for people with a disability who experience difficulty in moving into work. We are obviously anxious to ensure that the DPTC achieves this. The benefit being replaced,

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the disability working allowance, has largely failed. Only one quarter of those we expected to do so have taken it up because it failed to provide a sufficient incentive to work and it did little to help people who became disabled to stay and work. That is why we are seeking to change this by introducing DPTC.

Noble Lords will already have seen that DPTC will be more generous, with lower tapers, higher thresholds and improved help with childcare costs. But of course we want to do more if we can and if it will help. That is why we are consulting with various interest groups to seek their views on possible options.

One outcome has already been announced by the Chancellor of the Exchequer in his Budget package. It is a fast-track gateway to DPTC to help with the retention of staff disabled while working. Someone who was on the employer's payroll and being paid statutory sick pay can be assessed for DPTC without first having to drop out of work entirely on to a qualifying benefit, which is incapacity benefit or DLA. In other words, DPTC will allow someone to stay in work. We know that if such people are not kept on by their existing employer they find it difficult to find any other employer. I am sure that when I have the pleasure, probably at the Report stage, of bringing forward an amendment to make that commitment explicit, I will have the support of the entire House. At that stage, DPTC will be able to act as a partial incapacity benefit for someone working and disabled while in work and needing to reduce their hours or pay accordingly.

Another way forward which we intend to use, and which answers some of the concerns raised, is that of piloting some of the changes. The Tax Credits Bill builds on existing social security legislation. Within that, there are provisions for piloting changes. In response to organisations such as RADAR, we shall be exploring that. In addition, we are backing our proposals with the one-year linking rule we introduced last October and extending the 56-day rule for DWA to six months in which people may find work.

I was asked by the noble Baroness, Lady Darcy de Knayth, whether this would be monitored by the Disability Rights Commission. It will depend on the review and how it is conducted, but the Disability Rights Commission is there to ensure no discrimination. It is clear that under Clause 7 and the appropriate schedule there could be a case if the Disability Rights Commission believed that there was discrimination against a disabled person. That is my understanding, but if I am wrong I will write to the noble Baroness and to other noble Lords. Normally, social security benefits as such have not been matters for the equivalent of the Disability Rights Commission. Essentially, it is about active discrimination in employment practice, transport, housing, financial services and the like. However, I can conceive of circumstances in which discrimination applying to someone who seeks DPTC may subsequently become part of the remit of the Disability Rights Commission. In general, I would not expect that it would be because that is not what the Disability Rights Commission was set up to do. However, if I can be more helpful to the noble Baroness, I shall return to that matter. For example, if the Disability Rights

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Commission felt that a type of employer was discriminating continuously against people who should receive payment under this provision, there would be an opportunity for the commission to look at that matter. We can explore that later. I can see that it may have a part to play but, for the most part, as the noble Baroness will know, the Disability Rights Commission is doing a different job.

I hope that all I have said reassures the noble Lord, Lord Rix, that we shall keep fully under review the need to monitor and improve DPTC. Many noble Lords will want to track it and to see whether it is doing what we hope it will do; namely, to improve take-up of the benefit. In that light, I ask the noble Lord to withdraw the amendment. It is not only redundant. My main criticism is that it does not go far enough.

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