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Earl Russell: My Lords, the Minister was in the House just now, listening to my noble friend Lord Goodhart. When I say that he gave a brilliant demonstration of why it is a pity that regulations are not amendable, I do not mean to criticise the drafting of these regulations, which has been done with great care. I make purely a general point. I join the general and—as far as I can see—universal welcome of the main principle of these regulations. The encouragement of volunteering, which has been pressed for consistently since the introduction of JSA under the previous government, is warmly to be welcomed, both on the ground of the need to encourage civic spirit and on the need to give people training that may help them to get into future employment—and for the public good that much of it does. In that way, this is entirely welcome.

I very much welcome the inclusion of paternity leave. I have believed for a long time that the supposed female monopoly on childcare needs to go the same way as the past male monopoly on work. These two changes have come together. That is welcome, as is the recognition of adoption leave, which is coming in, worded as it is, in the light of the Adoption and Children Act 2002, which has just completed its passage through this House.

I have just one reservation, which concerns not what is in the regulations, but a missed opportunity in the amendment of Regulation 5 of the original Jobseeker's Allowance Regulations, which provides that people with caring responsibilities should be available for work within 48 hours. The extension of that 48 hours to volunteering is to be warmly welcomed, but in general it could have been extended for people with caring responsibilities. Very often, it is impossible to know exactly what caring responsibility you need to find help with until you know the hours of your employment, the physical geographical direction of your employment and what transport is available. If, for example, there is a bus that runs once an hour, it does not help if your nursery or place of childcare is on the same bus route. You have to stop to drop your child off and then you have to wait an hour for the next bus and you arrive late at work. You probably will not last long that way.

The same applies if the hours or directions are incompatible. When you actively seek work, you do not know whether you will need to travel north, south, east or west to find it until you get it.

In the light of that, a lot of parents will need to arrange their childcare all over again once they know what work they are being offered. For that, 48 hours is a very short time.

I am sure there will be future regulations dealing with jobseeker's allowance. If and when there are, I hope that point will be considered. That is the only note of reservation I wish to sound on these regulations, which I warmly welcome.

Baroness Hollis of Heigham: My Lords, I am grateful to the noble Lord and the noble Earl for their warm welcome. I am sure that had the noble Lord,

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Lord Goodhart, been here he would have scolded me for the use of the word "uneventful". I meant it as an alternative to saying that the regulations were not controversial and did not give rise to an issue of concern. Fortunately, I may be able to help the noble Lords with their eventful issues.

The definition of voluntary work is work for a not-for-profit organisation or work for anyone other than a member of a claimant's family, provided the claimant receives no payment, or only the payment of reasonable expenses. The proposals do not affect the existing small disregards for retained firemen and so on. Whether somebody is a volunteer is a question of fact for the Jobcentre Plus decision-maker. Clearly, someone is not a volunteer just because they do not accept a wage for a job for which somebody alongside them is accepting a wage. Then they are forgoing a wage that they would otherwise be entitled to have.

The noble Lord, Lord Higgins, asked about paternity and adoption leave. This is primarily a DTI matter, which is why he would not normally be familiar with it, but it has kickbacks into eligibility for jobseeker's allowance. Fathers will normally have a new right to two weeks' paid paternity leave, which can usually be taken within two months of a child's birth. Statutory paternity pay will be at the same standard rate as statutory maternity pay—100 per week or 90 per cent of average earnings if that is less than 100 in April 2003. Of the 400,000 new fathers every year, we expect perhaps 70 per cent to take it up. It is a welcome two-week break for them to be able to give their partners the support that they probably need at that time.

Adoptive parents—I am thinking now of the primary carer, not necessarily the father—will have a new right to 26 weeks' adoption pay and up to one year's adoption leave in total. Again, that is to be paid at the same rate as statutory maternity pay. We expect this to affect perhaps 4,000 adoptive parents. It is interesting that about 82 per cent of adoptive parents—both parents—are in full-time or part-time work. There is a need for that support, particularly, from my experience, if the parents are trying to settle into the home not necessarily a baby, but an older child who may have had a troubled background. We know that about 20 per cent of such placements can easily break down, with the child being recycled back into the care system as a result. I hope that answers the noble Lord's question.

Lord Higgins: My Lords, I am most grateful to the noble Baroness. I understand all that, but it was not my question. What is "ordinary" adoption leave as against, perhaps, extraordinary adoption leave or not ordinary adoption leave, or whatever? The term is used precisely.

Baroness Hollis of Heigham: My Lords, the Employment Rights Act provides for 26 weeks'

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ordinary leave and 26 weeks' additional leave. The right to pay applies only during the 26 weeks' ordinary leave period. The rest is unpaid.

Lord Higgins: My Lords, is the second category not covered by this?

Baroness Hollis of Heigham: Yes, my Lords, that is an optional addition. In other words, it is unpaid. The point is that employment law protects your right to return to your job during that period, even if you are not paid. That is what we are talking about. The noble Lord looks baffled. Is that all right? Good.

The noble Earl, Lord Russell, asked about the situation of carers. He presented the situation of somebody who had a job and was seeking to fit their caring around it. The regulations do it the other way around, allowing people to fit their job around their caring responsibilities. In other words, a carer needs to be available only at those times when they do not have any caring responsibilities, provided it is not for less than 16 hours a week. Carers claiming JSA will therefore record their specific limited hours of availability for employment in their jobseeker's agreement. These will normally be the hours when the carer has no caring responsibilities, so 48 hours' notice to take up employment should be sufficient, because it is to take up employment in the hours in which they are not caring.

We are not expecting carers to give up their caring in order to take up employment, unlike volunteers, whom we expect to give up volunteering to take up employment. That is why the apparent discrepancy continues. It is worth saying that any primary carer such as a lone parent would normally be on income support and therefore not claiming JSA and not falling within this regime. However, some lone parents who may be widowers may be seeking JSA. They will be entitled to limit their eligibility for work to fit around their caring responsibilities, provided they are significant—more than 16 hours.

Earl Russell: My Lords, I thank the noble Baroness, but the point remains that one cannot be certain of one's hours of availability for work until one knows the amount of travelling time that has to be fitted in as well as the hours of caring.

Baroness Hollis of Heigham: My Lords, I take that point. The point here is that if somebody has caring responsibilities and is also on JSA, we have no evidence not to expect that Jobcentre Plus staff and those associated with them have not been using their discretion appropriately. If the noble Earl has any cases to suggest that someone has fallen foul of these rules, I shall be very happy to look at them, but I have not come across any. Given that most lone parents in that situation would be on income support rather than JSA, it would be unusual. We are more likely to be talking about someone who is caring for somebody other than a child in these circumstances. Therefore, some of the issues that the noble Earl posited about

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taking a child to school or to nursery might not arise. If he ever comes across any such troubles, I ask him to let me know and I shall make sure that they are responded to in a civilised way.

With those responses, I hope the House will accept the regulations.

On Question, Motion agreed to.

Social Security Commissioners (Procedure) (Tax Credits Appeals) Regulations 2002

7.59 p.m.

Baroness Hollis of Heigham rose to move, That the draft regulations laid before the House on 28th November be approved [3rd Report from the Joint Committee].

The noble Baroness said: My Lords, I shall also speak to the Tax Credits (Appeals) (No. 2) Regulations 2002.

It may help to put these regulations into context if I remind the House of their background. The child tax credit and working tax credit will be introduced in April next year. Your Lordships may recall that provision was made during passage of the Tax Credits Act 2002 for appeals against most decisions made by the Inland Revenue on tax credits to be heard on a temporary basis by appeal tribunals within the Appeals Service. That provision was warmly welcomed in the House, particularly from the Liberal Democrat Benches. There will be an onward right of appeal to the social security commissioners. These arrangements will remain in place until the tax appeal system has been reformed. Appeals made by employers will not be subject to the same temporary arrangements as they will be heard by the tax commissioners. We discussed that issue at length during our consideration of the legislation.

The first of the draft statutory instruments before the House today makes regulations for procedures at the appeal tribunal—for Great Britain, not Northern Ireland. The second of the draft statutory instruments made by my noble and learned friend the Lord Chancellor provides for procedures at the social security commissioners. The two sets of regulations are made under powers in the Social Security Act 1998, as applied and modified by the Tax Credits (Appeals) Regulations 2002, made on 26th November. The Tax Credits (Appeals) Regulations 2002 are made under the powers in Section 63(8) of the Tax Credits Act 2002 and their purpose is to provide the same appeal route as that which applies for social security benefits. Briefly, Section 63 of the Act provides the legal framework for conferring on appeal tribunals the functions which will ultimately go to the general commissioners or special commissioners.

The appeal tribunals and the social security commissioners are already familiar with existing tax credits. However, your Lordships may wish to note that the Tax Credits Act 2002 provides for enquiry powers which are more like those generally used by the

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Inland Revenue. Consequently, two new types of case will be heard by appeal tribunals and commissioners. First, under Section 19 of that Act, the Inland Revenue may enquire into the entitlement of a person to a tax credit for a tax year and into the amount of tax credit due. The person who is under enquiry can apply in writing to the Board of Inland Revenue for the tribunal to direct the Inland Revenue to finalise the enquiry and to issue their decision of the proper award. Applications will be subject to similar processes and procedures as for tax credit appeals. The appeal tribunal will be obliged to give the direction applied for unless it is satisfied that the board has reasonable grounds for continuing with the enquiry.

The second new power concerns penalty proceedings. There are two types of penalty proceedings which carry rights of appeal and which will be heard and determined by appeal tribunals. In the first type of case, the Inland Revenue may impose a penalty on a person for providing an incorrect statement or information. Penalties imposed by the board carry appeal rights under Section 38 of the 2002 Act. In hearing an appeal against a penalty imposed by the board, an appeal tribunal may set aside, confirm, reduce or increase the penalty up to the maximum of 3,000 allowed under the 2002 Act. There is a further right of appeal from the tribunal's decision to the social security commissioners.

In the second type of penalty proceedings, it will be for an appeal tribunal to decide whether or not a penalty should be imposed on a person who does not comply with a notice from the Inland Revenue to provide information. While the Inland Revenue may apply to an appeal tribunal to determine a penalty, the tribunal cannot impose a penalty if the failure has been remedied beforehand. Penalty proceedings are started by the Inland Revenue laying information in writing before the appeal tribunal about the failure. The tribunal summonses the defendant to appear at a hearing and answer the information and, if the failure is still continuing, the tribunal may declare the failure and impose a penalty of up to 300. There is then a right of appeal against the tribunal decision to the social security commissioners.

I turn first to the Tax Credits (Appeals) (No. 2) Regulations, which make provision for administering and deciding tax credits appeals, applications for a direction to close down and enquiry and penalty proceedings. Your Lordships will be pleased to note that I do not intend to discuss each individual regulation. I should, however, like to draw your attention to the broad areas they cover and regulations of particular interest.

Draft Regulation 2 covers the service of notices or documents. Regulations 3 to 5 deal with persons with a right of appeal and time limits. Regulations 6 and 7 set out how an application for an extension of time in which to appeal and an application for a direction to close down a tax credit enquiry are to be made. Regulation 8 prescribes those persons who may proceed with an appeal or with an application for a direction where a party to the proceedings has died. Regulation 9 sets out the composition of an appeal

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tribunal hearing different types of tax credits cases, a matter on which I can enlarge. Regulations 10 to 27 deal with procedures and broadly mirror the provisions of the Social Security and Child Support (Decisions and Appeals) Regulations 1999.

I turn now to the second set of regulations, the Social Security Commissioners (Procedure) (Tax Credits Appeals) Regulations 2002. Again, I shall be brief. These regulations, like the preceding ones, largely mirror the existing Social Security Commissioners (Procedure) Regulations 1999, which detail the procedure. Changes are made where necessary to reflect the new tax credits system under the Tax Credits Act 2002.

Noble Lords may wish to know two things about these regulations. First, certain provisions in the 1999 regulations which are not applicable to tax credits have been omitted from these regulations, such as those provisions under the Forfeiture Act.

Secondly, noble Lords may wish to know that both types of penalty proceedings which I have already described as coming before the appeal tribunal are appealable to the social security commissioners. They attract an automatic right of appeal to the commissioners on matters of both fact and law, where the penalty is initially determined by the board. Where the penalty is initially determined by the appeal tribunal, they attract an automatic right of appeal by all parties on a question of law and, by the defendant, on the amount of the penalty. This is in contrast to all other matters appealable to the social security commissioners, which are purely on points of law and appealable only with leave. The special situation applies because it is a sanction.

I am satisfied that these regulations are compatible with the European Convention on Human Rights. I commend the draft regulations to the House. I beg to move.

Moved, That the draft regulations laid before the House on 28th November be approved [3rd Report from the Joint Committee].—(Baroness Hollis of Heigham.)

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