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I accept the noble Baroness’s broad stricture that we should aim to make matters simpler. I do not think that any one Finance Bill will significantly increase the burden. The achievement of rewriting, which codifies past Finance Bills, should be recognised. I have no doubt that my right honourable friend’s Budget in the other place will be testing in certain areas. It is likely to be a good deal more testing to values and judgment than to complexity or simplification, but I hear what the noble Baroness says about that.
It is fair to ask whether simplification is an objective. Certainly, we want our taxation laws to be as clearly understood as possible in order to avoid the inadvertent actions that sometimes occur with regard to tax. It defeats the whole object of our attempt at self-assessment if we cannot keep taxation laws clear enough for the average citizen to cope confidently with a submission of their taxes without necessarily having recourse to professional advice, which we all know comes at a price and which, for the vast majority of our citizens, would never be meaningful in terms of value for money in their own situation.
I have no doubt that future Finance Bills are bound to add to the burden of the noble Lord’s committee, but Kenneth Clarke deserves the plaudits of us all for putting on the agenda since 1996 a clear realisation of the virtues of clarity and simplification in tax laws, of which the Chancellor of course takes account.
I am not able to give the kind of assurances that the noble Baroness wants on this week’s Statement, but I agree that we should share her broad objectives. I also countenance the obvious fact that it is easier to have a broad objective than it is to achieve in detail certain aspects of necessary tax changes in an increasingly complex society. The noble Baroness would be the first to understand that there are developments in the world of finance and wider aspects of society that throw up fresh problems almost year on year. It is not surprising, therefore, that the Finance Bill is complex. Nevertheless, I respect the point made by the noble Baroness and the noble Lord, Lord Newby, on simplification. The noble Lord, Lord Newton, attests by his very presence the important objective of the exercise. On that basis, I hope that it will be recognised that this work and Bill are a very important step forward. I commend the Bill to the House.
On Question, Bill read a second time; Committee negatived.
Then, Standing Order 47 having been dispensed with, Bill read a third time, and passed.
Lord Bassam of Brighton: My Lords, I beg to move that the House do now adjourn until 8.35 pm.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 8.14 to 8.35 pm.]
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Welfare Reform Bill
Consideration of amendments on Report resumed.
Clause 25 [Parliamentary control]:
Lord Skelmersdale moved Amendment No. 51:
“( ) regulations under sections 8 to 14;”The noble Lord said: My Lords, the amendments in this group are a refinement of those that I tabled for Grand Committee. At that point, I believed that all the regulations flowing from Part 1 of the Bill should be subject to the affirmative procedure. The Minister pointed out that some 400 orders would be consequential on the enactment of the Bill, most but by no means all of them translating orders for incapacity benefit to fit the new regime of the employment and support allowance. Therefore, it would be a complete waste of parliamentary time to have all of them debated again and again as the situation changed. However, as I said at the beginning of today's proceedings, we are dealing with a wholly new benefit, which has not even been piloted very far as yet, although pilots have started—indeed, we were grateful for the report of the first year of the pilots that the Minister provided some weeks ago.
Your Lordships’ Delegated Powers and Regulatory Reform Committee did a pretty thorough job in recommending that certain of the orders should always be affirmative, and the Government have acquiesced, putting down amendments to cover those. However, the committee’s report stated that it was “not inappropriate” for some of these orders to be affirmative the first time they appear. All the subsequent changes would be, as the Bill states, by regulations subject to the negative resolution procedure. While I have tried to incorporate some of the Minister’s concerns about making all the Part 1 regulations subject to affirmative approval by this House and another place, I have not heard any suggestion that the second and subsequent orders would be of such a minimal nature that the negative resolution procedure would be appropriate.
Naturally, I appreciate the Government’s attempts to take into account the recommendations of the DPRRC and to make some of the more contentious regulations arising earlier in the Bill subject to the affirmative procedure. I hope that I can persuade the Government to do the same with the regulations that will arise from Clauses 8 to 14, which deal with the meat of the system: they cover how the assessments will be set up, what they will assess and what the results of those assessments will be. Although the Government have attempted to show us as much draft regulation as possible, it is impossible for them to provide us with a full picture, especially as the various pilot stages have yet to be completed.
It is therefore inevitable that quite major changes will be made after the first regulations are made. For example, the pilot could well show that the original method of conducting assessments or a particular facet of them was not working as expected or indeed desired. Only last Thursday, the Minister and I
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Although I originally thought, as I said, that it would be right to make all the Part 1 regulations affirmative, I was, as I also said, gently steered off that by the Minister, who called my proposal “overkill”. I agree. However, after Committee, the Bill team helpfully provided me with a table of what regulations each part of the Bill empowered. These clauses cover 15 separate regulations—hardly an enormous burden on parliamentary time given that they are closely associated in many cases and will surely be made and therefore debated together. The amendment would give the House an opportunity to have a fully informed debate on this new and unproven system as it changes—as it assuredly will. It will be of great value in providing further scrutiny of what your Lordships—even the Minister—will agree is a very complex Bill. I beg to move.
Lord McKenzie of Luton: My Lords, I thank the noble Lord for moving his amendment, which would make regulations under Clauses 8 through 14 subject to affirmative resolution. As he acknowledges, that is a restriction on the amendment that he moved in Committee.
Lord Skelmersdale: My Lords, it is an enormous restriction.
Lord McKenzie of Luton: Well, my Lords, we shall see quite how significant the restriction is. The scrutiny of legislation is a very important subject. However, I continue to disagree with the way forward that the noble Lord’s amendment suggests.
As noble Lords are aware, we have provided draft regulations to the House under Clauses 8, 9, 10, 11 and 13. The regulations under Clause 12 are subject to affirmative procedure on their first use; that is quite right, given that mandatory work-related activity will be a step beyond Pathways to Work-style conditionality. On other clauses in Part 1, we have accepted the recommendations of the Delegated Powers and Regulatory Reform Committee on the regulations that should be subject to affirmative procedure. On the clauses covered by the amendment, the committee did not make recommendations and specifically noted in its report the number of draft regulations that the Government have made available.
I do not believe that it is necessary for regulations under Clauses 8 to 14 to be subject to affirmative resolution, given the steps that we have taken and the reassurances that we have given. The amendment goes further and would have all sets of regulations under the clauses now and forevermore subject to affirmative resolution. Small changes in regulations are necessary to ensure that policy is effective and works. When necessary, this can mean learning from experience and altering procedures as appropriate. Making all regulations subject to affirmative procedure would require debates
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As for the number of regulations that the amendment would cover, we have 15 regulation-making powers, but that could result in something like 100 regulations in all. I am sure that even the noble Lord would accept that that would be a considerable burden on Parliament’s time. It is always good fun to be in his company when debating these matters, but one can have too much of a good thing—and I suggest that the 100 regulations subject to an affirmative procedure that would result from this amendment would be a little more than a good thing.
On that basis, I urge the noble Lord to withdraw his amendment. In doing so, I am very happy to sit with him and ask officials between now and Third Reading to take him in a bit more detail through what might be involved with the 100 regulations that he suggests should be affirmative. That might help to engender a broader understanding of the flavour of the regulations and the small movements that some of them might contain.
Lord Skelmersdale: My Lords, that offer is most gratefully accepted, but I am concerned about the Minister’s use of the words “small changes”, because with some of the regulations the changes are likely to be far from small; in fact, they might be quite extensive. Certainly, as the Minister says, the Government will learn from experience as this all beds down, which is the point of the five-yearly report that we agreed to a few hours ago. I am surprised to hear that there may be as many as 100 regulations in all, when I cited 15 that would, as I saw it, be involved in this change. As I said, I do not think that 15 regulations would be excessive, given that many would be debated together. Arguably, 100 regulations would be excessive, but I will have to ascertain how linked they happened to be and whether they would be likely to be debated together and available for debate on the same day, which is sometimes another factor in our consideration of regulations. I shall withdraw the amendment, but again reserve my right to raise it again at Third Reading should I feel it necessary. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.45 pm
Schedule 4 [Transition relating to Part 1]:
Lord McKenzie of Luton moved Amendment No. 52:
Schedule 4, page 74, line 23, leave out “an existing benefit” and insert “incapacity benefit, income support or severe disablement allowance”
The noble Lord said: My Lords, I shall speak also to government Amendments Nos. 53 to 68 and government Amendments Nos. 69 to 80. For some reason, they have been degrouped on the amendment list, but they are part of a whole, and I propose to speak briefly to them all at the same time.
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This group of amendments is technical in nature and relates to Schedule 4. The amendments clarify the drafting to ensure that we have the power to migrate all groups that we may wish on to employment and support allowance. Their intention is to ensure that we have the power to migrate existing customers who can claim income support as carers or lone parents but who have also demonstrated incapacity for work. The amendments do not affect the policy position that we have taken previously on migration of existing customers. Existing customers will be migrated on to employment and support allowance over time and as resources allow, and will have their benefit levels protected, meaning that nobody will suffer a cash loss under the new allowances. The amendments ensure that the correct powers are in place to follow this policy. I beg to move.
Lord Skelmersdale: My Lords, as the Minister said, these are extremely technical amendments. Perhaps he would care to look at paragraph 11 of Schedule 4. I have done a little analysis of Amendments Nos. 71 to 78, which totally redraft the paragraph from the beginning of line 5 to the end of line 15. I note that the amendments would insert the words “an award of” three times, in sub-paragraphs (a), (b) and (c). Surely it would be more appropriate for Amendment No. 71 to alter line 5 to state,
followed by sub-paragraphs (a), (b) and (c). This would save six words on the statute book. We all try at all times to limit the statute book to the purposes for which the various Acts of Parliament are designed. I would have no complaint if the Minister decided to remove at Third Reading the whole of paragraph 11 and show us a Keeling schedule, which would make life a lot simpler.
I agree with Amendments Nos. 52 to 56, but I am confused by Amendment No. 57. Why does income support suddenly appear? Amendment No. 58 relates to migration. I have covered the other amendments, except for Amendment No. 69. That amendment will leave out sub-paragraph (4), which defines “existing award”, from paragraph 7 of Schedule 4. Why is this necessary?
Lord McKenzie of Luton: My Lords, I thank the noble Lord for his points. On his suggestions about the drafting of these amendments, in my short time in your Lordships’ House, I have learnt to subject myself to the wisdom of parliamentary counsel. I will pass on those comments to see whether counsel wish to offer alternative drafting, but I would not hold my breath on that.
The noble Lord was asking about Amendment No. 57, which provides that the claim for ESA be treated as a claim for incapacity benefit, income support or severe disablement allowance as part of the transition arrangements. I think that that touches on the point about where claims might come in at a point of transition, when there is an opportunity to migrate people on to ESA. That is the thrust of the amendment. However, rather than prevaricating on this matter, I ought to revert in more detail to the text.
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Lord Skelmersdale: My Lords, before the Minister sits down, would he agree to write to me on those various points? I realise that I have rather bounced him. To an extent, I have rather bounced myself in these questions. However, these sorts of amendments often go through without any comment at all. That is a bad precedent to set and I am not going to set it.
Lord McKenzie of Luton: My Lords, the noble Lord has been assiduous in pursuing these details. He is quite right. I am sure that these technical amendments generally go through on the nod. I am happy to write to him in more detail and to expand on the focus of that amendment—or that part of the group of amendments. Would he specify again whether there are any further provisions, so that we can ensure that those are covered when we write to him?
Lord Skelmersdale: My Lords, my three questions were about Amendment No. 57, about paragraph 11 in total and about why leave out sub-paragraph (4) on page 76.
Lord McKenzie of Luton: My Lords, I undertake to write to the noble Lord on those.
On Question, amendment agreed to.
Lord McKenzie of Luton moved Amendments Nos. 53 to 68:
Schedule 4, page 74, line 31, leave out “an existing benefit” and insert “incapacity benefit or severe disablement allowance”
Schedule 4, page 74, line 33, after “claim” insert “for incapacity benefit, income support or severe disablement allowance”
Schedule 4, page 75, line 2, leave out “an existing benefit” and insert “incapacity benefit, income support or severe disablement allowance”
Schedule 4, page 75, line 19, leave out from “existing” to “would” in line 22 and insert “award, and
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Schedule 4, page 75, line 45, leave out from beginning to “would” in line 1 on page 76 and insert “and,
On Question, amendments agreed to.
Lord Low of Dalston moved Amendment No. 68A:
The noble Lord said: My Lords, the amendments that we have just agreed to might be technical but I do not intend to let them go through on the nod. Although they have already gone through, I wish to address them none the less. In speaking to them, the Minister referred to the Government’s intention to move people on to employment and support allowance with income protection. It is the question of protection that I wish to address.
The Government have made it clear that they intend incapacity benefit and income support claimants to move over to employment and support allowance following its introduction in October 2008. I understand that they intend to begin this migration with the most recent claimants and those with dependent children because the quicker a claimant engages in work-related activity the more likely they are to move off benefit and into work. Helping parents off benefits and into work will also have a positive impact on the drive to reduce child poverty.
This is a probing amendment designed to enable me to raise three issues on migration, which I would be grateful if the Minister would be kind enough to address. First, will there be a loss of income for claimants being migrated, as and when that occurs? Secondly, there is a real danger that many current incapacity benefit claimants will not meet the requirements of the new personal capability assessment and will fail to qualify for the employment and support allowance and therefore be moved on to JSA. Lastly, what will happen to residual, transitional protection for claimants of invalidity benefit and severe disablement allowance, which are both now abolished?
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