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The package, which appears to be readily available, requires four elements. The first is evidence-based psychological therapy at a cost of just £750 per person. This work is currently being piloted in two NHS trusts. The second is evidence-based individual placement

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and support, a form of supported open employment widely tested in the US and found to be successful for people with mental health problems. London mental health trusts, and no doubt many others, are introducing this approach, and in two cases they have already done so. The third is work with employers to reduce the stigma of mental health issues and to ensure a more supportive environment in the workplace with the support of NHS staff. I understand that the DWP is doing important work in that area. Nothing I am saying is new, and if you put it all together, you really begin to get somewhere. The fourth crucial item is the reform of, and rendering automatic, the linking rules to take away the fear that these people face when they take the first steps into jobs.

I turn to other concerns about the Bill. The policy presented in the Bill was tested in the Pathways to Work pilots, which were well resourced and included regular back-to-work interviews and opportunities to benefit from a variety of support services and a back-to-work bonus of £40 a week. I hope that that bonus is in the regulations. The pilots were rightly heralded as a success, but hidden behind the success was the fact that people with mental health problems were not assisted into work by the Pathways to Work pilots. The pilots worked for others.

The system to be introduced by this Welfare Reform Bill will be a pale reflection of the pathways pilots’ design. For a start, the DWP faces a 5 per cent spending cut in 2007-08. There will be fewer staff and, no doubt, staff less well trained to process the employment and support allowance system. All this bodes ill for vulnerable claimants. What, then, are the important differences between the pathways pilots and the Bill itself?

First, the Government plan to contract out all the work associated with the new employment and support allowance. The justification for contracting out the service is based on a flawed evaluation of an entirely different project involving the placement of unemployed people. In that project, the contracted-out service was altogether stronger in design than the in-house model with which it was compared, thus proving nothing. The successful Pathways to Work pilots were, by contrast, undertaken in-house by Jobcentre Plus. The fact is that we have no evidence that contracting out the employment and support allowance will help clients back to work. There are reasons to fear the opposite.

Secondly, contractors will be outcome-focused. They will, I understand, be paid only if they place a person in a job. That did not apply to Pathways to Work. We can assume that the financial incentive of payment by results, or payment for every successful job placement, will either result in undue pressure being placed on people with mental health problems, whose symptoms are likely to increase under stress, or this group will simply be left out in the cold.

Thirdly, the £800 per job placement is based on the actual cost of placing someone in work in the pathways pilots. But we know that mentally ill people were not helped into work. The question then is: what would it cost to place people with mental health problems in

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work? It would certainly cost a good deal more than £800 per person. For example, we know from the Sainsbury Centre that the average cost of condition management in the pathways pilots was £1,200. The figures stack up only because 12 per cent of people on those pilots received condition management.

Apart from the dilution of the pathways model, there are many other concerns. One of our problems in debating the Bill is that most of the detail will be in the regulations. The personal capability assessment that others have mentioned will determine whether a person is deemed to have a “limited capability for work” and is entitled to the ESA, or whether they fall into the support category. The PCA is thus of huge importance to claimants; it determines their livelihood.

The PCA has until now failed to assess mental disorders effectively, as others have mentioned. A lot of work has been done to improve the tool used for mental health assessments, and I applaud the Government for that, but the accuracy of the PCA will depend on more than the tool itself. It is essential that the person undertaking the mental health assessment has appropriate training as well as regular contact with the person being assessed so that he really understands how the person is over time. At present, the person’s GP will be invited to complete a form before the assessment begins. Many mentally ill people, particularly those with severe and enduring problems, rarely see their GPs. A member of the community mental health team would be in a far better position to help. In view of these failures, I trust that the Government will test the new PCA all the way to appeal in order to ensure that it will be successful.

A major issue is the conditionality introduced with the ESA group. It sounds very reasonable, until we get down to individual cases and what it will mean in practice. I met someone recently who suffers from clinical depression and anxiety. She is literally terrified by this system. Her symptoms are made worse by leaflets coming through the door, and it is difficult to imagine how she is going to cope with the process of being invited to assessment after assessment, interview after interview, and so on. She feels that her whole life will be under threat.

I fully support the Government’s commitment to increase the number of people in employment by 1 million over 10 years, but I am profoundly concerned that the Bill will cause increases in NHS expenditure and will not achieve the Government’s objectives unless the concerns that we have all expressed are addressed.

8.02 pm

Lord Addington: My Lords, one of the advantages of being called on to sum up a debate is that I can refer to noble Lords who have clarified points. This is an odd Bill. Getting people off benefits and into work whenever they want is rather like motherhood and apple pie—how could anyone possibly be against it? The problem is how to do it effectively and to benefit people without damaging a few of them, some of them or all of them along the way; that is, how to minimise the risks and personal damage. That is

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where the problems lie. Throughout this debate noble Lords have said that the Bill is a good idea, but they have also asked about this or that aspect of it. That is not unusual in this area, and I do not think that the Minister will thank the business managers for scheduling the debate on the Mental Health Bill so close to this debate.

I turn to the concerns that have been raised. The main point was that the provisions’ success or failure will lie in work-focused interviews and activity. In practice, the provisions will stand or fall on correctly placing people according to their skills, condition and disability. How can we give people the back-up they need to get off benefits and into the workplace? I have long been dealing with disability matters in this House, and there have always been two issues to address: perception and practical help. I believe that perception is the first issue to address. If it is perceived that someone in a wheelchair is unemployable, to take an easy example, he will be unemployable because he will be told that he cannot work. The minute the problem is addressed in a slightly more lateral manner, it becomes a minor problem because other jobs that he can do will be discovered. But people in wheelchairs are comparatively easy to deal with provided that that is their only problem. Although they have a movement problem, modern regulations have been introduced to help enable them to get into offices. Much work is based around modern business technology—PCs—and using a keyboard. Many people in wheelchairs will not have great difficulty using that technology once the initial impact of doing the job has been overcome.

When we get to the more complicated group of people with mental health problems, the perception is that that they are all raging psychopaths waiting with an axe at the coffee vending machine, or that if they hear a cross word they will break down in tears or not turn up the next day. They will not do those things. Those perceptions must be broken down. Other legislation has attempted to do so. The Government must take that on board when they implement this legislation or much of it will fail that group.

The noble Lord, Lord Low, made the excellent point that certain groups—those with straightforward mobility problems, for example—can be creamed off and dealt with quite easily now. Other groups with physical disabilities will be more difficult because they are not understood. Unless we co-ordinate what can be done and what should be done, we will fail. The conditionality clauses, Clauses 10 to 15, are where the legislation will stand or fall. Unless we get the right support for people undertaking interviews and assessments, everything else will be of limited value. I have looked at the Bill and dealt with this subject over a number of years, so I shall ask the Government a series of questions about the conditionality process that go back to the theme of training which the noble Baroness, Lady Hollis, and I have raised. I did catch the spray from that shot across my bows.

When a person’s needs are more complex and they belong to two groups, things can get more complicated. As has been pointed out to me, somebody who has AIDS or a physical disability may have more reason to be slightly depressed than someone who does not. It

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may be complicated to place a target group of people with a complicated cocktail of disabilities. How do we address placing them when they have to face two sets of perceptions?

Provision for training and best practice should be written into the Bill, as should a duty on those undertaking the assessment and interview to call on expertise and support when they feel they need it, or suspect they do, in order to prevent the wrong advice being given. Such advice has led to successful appeals under the current system. If we achieve a degree of success in this part of the Bill, we will have made real progress.

Although I appreciate that this will have to be teased out in Committee, I hope that the Government will give us some idea about the linkages—the joined-up government, if we must use that now rather worn expression—with the Government’s awareness programme for employers. Let us concentrate on the employers who do not feel a need to employ a public relations firm; that is, the small employers who are supposedly the dynamic part of the economy. The big people who have big advertising budgets know how to implement the Government’s schemes. They also know that it is worth their while to do so, because they are playing at a higher level. How are the Government getting into the small and medium-sized parts of the economy to address the bad perceptions facing some groups? If we could hear about such linkages and co-ordinate them with support for those implementing the system, I would be considerably less worried less about it.

If we do not address those problems we will have real trouble. We may unintentionally go backwards and not forwards. But that probably will not happen because of creaming-off. People will say, “Statistically, we were able to do this”. But that will have been comparatively easy. We could create a second class of people who are pushed yet further back. I think that people suffering from mental health problems will probably comprise the biggest part of that group. We have to press on.

The situation will change as drug treatments, like support for those with physical disabilities, improve. We must be able to update and inform these people on a rolling basis. I could flog that point to death, but I should look more widely at other parts of the Bill. For example, will the Government themselves take action to improve access to work? All noble Lords have mentioned that point although it was supposed to be the best-kept secret. I wonder how the Budget will survive such secrecy. I believe that the departments themselves are supposed to be taking on the related expenditure. How much money is being put aside to implement this? Is there a guarantee that the result will not be departments which need three clerks deciding not to hire someone in a wheelchair because accommodating them would take up some of their budget and allow them to hire only two clerks? How will that be addressed in the departments? It would be an interesting example for other employers.

I can quickly address the housing benefit provisions in Part 2. The single room rent issue is an anomaly of catastrophic proportions. It guarantees

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that a young unemployed person will be discriminated against. As the prison statistics show, many young unemployed males end up in prison. I therefore again urge the departments to look over their shoulders at other departments. Also, on housing benefit, what exactly will be the on-costs? Perhaps a little punishment and a rap across the knuckles are in order here. I wonder what exactly the costs will be as people lose housing benefit because they are badly behaved and lead chaotic lives. I suggest that it will only build on the problems, not remove them. One may feel better by implementing the provisions until they come back to you on your doorstep.

We can look at many other issues. I think that the noble Baroness, Lady Murphy, said that one should monitor the processes and the IT systems. It is vital to monitor everything to do with this system. During the Bill’s passage we have to ensure as a collective unit that the Government clearly answer how they think their regulations will come in and how they will create a system that stands a chance of working. Unless they support their front-line staff to make correct decisions and give them the flexibility to call in the help they need, we will end up having to address this issue again—after perhaps five years of hiding behind statistics that are rapidly moved round to show that everything is fine, until we have to admit that it is not.

8.13 pm

Lord McKenzie of Luton: My Lords, I am grateful for the deliberation noble Lords have given to the Bill today. It has been the House at its very best. I will seek to address the specific points raised. Before that I will take the opportunity to welcome the degree of consensus that has already been built up on the overriding principles behind the Bill, which has been evident throughout today’s debate. I acknowledge the concerns expressed about practicalities, about resourcing and expertise—and I note that we will have some interesting debates about the shared room rate and housing benefit sanctions.

I will go through as many of the specific points as I can in the 20 minutes allotted to me, while recognising that when we get to Committee stage pretty much everything we have discussed today will feature again. The noble Lord, Lord Skelmersdale, asked whether this was all about fears of harassing people with mental illness back to work. It demonstrably is not. This is about people we know want to work and helping them to break down the barriers that prevent them working.

A question was asked about existing customers. People already on incapacity benefits will have their cash benefits protected. Over time we will migrate existing customers to the employment and support allowance to bring all customers under the same system, helping to smooth administration and reduce complexity.

The noble Lord asked whether a claimant with mental health difficulties would be able to bring an intermediary to the assessments. The answer is yes, we would encourage customers to bring a representative to medical assessments. It is most important that the entitlement is based on decisions that have the correct

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evidence. The noble Lord, Lord Skelmersdale, asked about regulations. Regulations relating to Clauses 12 and 15 have not been prioritised and are not in the release later this week. I hope that regulations relating to Clauses 8 and 10 will be informative and help our deliberations in Committee.

I was asked whether the terminally ill will go on to the main phase immediately. The way we treat people with terminal illnesses is obviously a very sensitive issue and I am conscious of the arguments put forward in favour of shortening the assessment phase for this group. We continue to look at how best to support terminally ill customers and will return to the House at a later date with our response. The issue about people undergoing cancer therapy was raised by the noble Lord, Lord Skelmersdale, and my noble friend Lord Morris of Manchester. There will be no automatic process on to the support group. We do not want to write anyone off, so the criteria for entitlement to the support group are based on the functional limitation that the individual has as a result of the condition.

On local housing allowance, the question was asked whether landlords would pull out of the market. It is true that there was initially a lot of opposition from landlords to the local housing allowance, but the pathfinder evaluation has revealed that while some landlords have left the market others have joined and there has been no impact on overall supply. One of the benefits of the local housing allowance is that the landlord will not necessarily know that the tenant is on the housing benefit so that will remove some of the difficulties that may currently be encountered.

A number of noble Lords—the noble Lords, Lord Addington, Lord Skelmersdale and Lord Low—asked what is being done directly with employers to ensure their engagement with people with mental health conditions in particular. The Government are committed to supporting employers and tackling discrimination, but we need to work on the good work of organisations such as the DRC, which works to raise awareness of disability issues with employers. The DWP has recently launched a major campaign aimed at employers, especially small and medium-sized enterprises—the point pressed by the noble Lord, Lord Addington—to help them recognise their obligation under the DDA as well as the benefits that that can bring.

In October last year, the Department of Health launched a new initiative, Action on Stigma: Promoting Mental Health, Ending Discrimination at Work. At Budget 2006, the Chancellor announced a cross-cutting review of mental health and employment outcomes which would look at existing best practice, holes in provision and options for the future. The review, which is ongoing, will provide recommendations for practical solutions and we hope that it will be completed by Budget 2007.

The noble Lord, Lord Oakeshott, raised the issue of psychological therapies and of CBT in particular. I agree that psychological therapies, such as CBT, can often play an important role in helping many people with mental health problems to manage their condition

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and return to work. As such, we are exploring ways of increasing access to those therapies. The Department of Health established the Improving Access to Psychological Therapies programme, which aims to develop a service model for delivering a range of evidence-based interventions. There are two national demonstration sites, in Newham and in Doncaster, one of which was referred to by the noble Baroness, Lady Meacher. While we believe that cognitive behavioural therapy has a role to play, we must remember that one size does not fit all and psychological therapies may not be appropriate for many of our customers. We need to consider a range of support for people with mental health problems, and I refer again to the Treasury’s review of these matters.

The noble Lord, Lord Oakeshott, asked whether these resources were affordable. Over the next two years, we will be investing a further £360 million on our welfare reform Green Paper proposals, which include extending the Pathways to Work programme nationwide by 2008. The department is working through the implications of the spending review settlement for its employment programmes and is working closely with HM Treasury to ensure that spending plans between 2008 and 2011 support departmental aspirations. The question was asked whether we can deliver pathways while cutting staff. That is a question of prioritising resources. We have announced that the remaining 60 per cent of pathways will be rolled out using primarily private and voluntary sector participants.

The noble Lord, Lord Oakeshott, and the right reverend Prelate the Bishop of Leicester asked about the anti-social behaviour processes and the withdrawal of housing benefit. The Government have a wide range of measures to tackle anti-social behaviour as well as the provisions in this Bill. The court’s decision to evict a household is often taken for the whole household and is dependent on robust considerations relating to the needs of the wider communities and the individuals concerned.

A question about safeguards was raised. There will be safeguards to protect the vulnerable. Each case will be considered on an individual basis before a local authority pursues a housing benefit sanction. It should take a decision about whether a sanction is an appropriate tool to use or whether a different route could be used. For example, if there are serious mental health issues, a referral to mental health services might be a more appropriate route. We intend to pilot the Clause 30 provisions for two years only and will fully evaluate that before any decision to roll out the scheme is taken.

The right reverend Prelate the Bishop of Leicester raised concerns both about children and about the creation of homelessness. We recognise those concerns. It is not the policy’s intention to sanction large numbers of people. A sanction is not a punishment; it is an encouragement to accept an offer of support to households in crisis.

The right reverend Prelate the Bishop of Leicester asked what happens if support is not available. If support is not available either because the local

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authority does not have support structures in place or the programmes are full, then no sanction could be applied.

Why are we targeting people on housing benefit? Well, we are not specifically. No one is suggesting that anti-social behaviour is confined to those in rented accommodation or to those who claim state benefits. We do not see this measure as the primary tool for tackling anti-social behaviour; rather, it is one measure that can assist in that.

The noble Lord, Lord Oakeshott, asked how we are rolling out Pathways to Work whether it works. Pathways to Work already covers 40 per cent of the country. The remainder will be rolled out in two phases and delivered by providers. Phase 1 will be up and running by October 2007, with phase 2 by April 2008. Again, the issue of resources was raised. We have repeatedly committed to funding a national pathways service and there is no question of doing that on the cheap. This is not a cost-cutting exercise, but obviously we have to live within the spending review settlement.

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