Supplementary written evidence: letter
from Mr Richard Heaton, Director-General and Solicitor,
Department for Work and Pensions
1. We gave evidence to the Select Committee
on behalf of the Department for Work and Pensions on 27 November.
2. In the course of our evidence we undertook
to write to the Committee with further information in two areas.
Firstly, on the "six months rule" which exists in relation
to the work of the Social Security Advisory Committee (SSAC);
secondly, on our plans for implementing regulations arising from
the Pensions Act 2007. Subsequently, your advisors asked for any
more we could say on our process of reviewing the effect of Instruments.
The "six months rule"
3. This rule exempts regulations made within
six months of commencement of the relevant primary power from
the general statutory requirement to refer amending regulations
to the SSAC. The exemption is contained in section 173(5) of the
Social Security Administration Act 1992. Provisions mirroring
the SSAC exemption are contained in certain other statutes such
as the Pensions Act 2007, although it should be noted that the
1992 Act was a Consolidation Act and the exemption pre-dates that
legislation. A general exemption in the circumstances described
above was introduced by virtue of the Social Security Act 1986
but was applied from 1980-1986 on an Act-specific basis.
4. The purpose of the exemption, as Richard
Heaton explained, is to allow the Department to implement new
legislation quickly by avoiding the need to mount a statutory
consultation with the SSAC. Ministers have taken the view that
it would not be right to delay the implementation of major reforms
to the social security system by building in a statutory requirement
to consult the SSAC in these circumstances. Such a requirement
could delay the implementation of major reforms by approximately
six months if the SSAC decided to seek formal referral of such
regulations.
5. The Committee may also wish to note that,
in relation to major reforms, DWP is likely to have consulted
widely before the relevant primary powers receive Royal Assent.
For example, the Welfare Reform Act 2007 was the subject of extensive
consultation involving publication of draft regulations. And even
where the exemption applies, the Department is likely to undertake
non-statutory consultation: it is only the requirement to undertake
this particular form of consultation that does not apply.
6. Richard Heaton mentioned that Ministers
recently agreed to pilot an informal arrangement whereby the SSAC
would have sight of draft regulations statutorily exempted through
the operation of the six months rule.
7. The primary aim of the pilot is to better
acquaint the SSAC with the content of new regulations. The substance
of such regulations will, of course, come before the Committee
should Ministers subsequently propose amendments that fall within
the SSAC's statutory remit. As a by-product of what is a predominantly
educative process, the SSAC may, in the context of the pilot,
make substantive observations on the regulations informally referred
to them. DWP will, of course, consider any such observations carefully.
8. DWP and the SSAC have agreed to evaluate
the pilot jointly once it has concluded. We anticipate that this
will take place during the Summer of 2008. Ministers gave an undertaking
earlier this year during the passage of the Welfare Reform Act
2007 that they would consider any implications for the SSAC's
future functions that the pilot may raise and, furthermore, to
make public their conclusions. We can confirm that we will also
take that opportunity, with the benefit of SSAC's observations
and those of your Committee, to consider whether the utility of
the clause itself should be reviewed.
9. In the meantime, the Committee may wish
to note that the clause is not included in either of the two DWP
Bills currently before Parliament.
The Pensions Act 2007
10. The implementation plan for the secondary
legislation required to underpin the changes made by the Pensions
Act 2007 is based on the following approach:
— Regulations with a common start date
will be grouped in a single Statutory Instrument, as far as this
is practicable.
— Regulations will be laid well in
advance of their implementation date, to take account of the long
lead-in times required for IT development.
— As we have flexibility in the timetable
because of the long lead-in time, we should be able to avoid laying
regulations during the peak periods.
11. The bulk of the regulations arising
from the Act will come into effect on 6 April 2010. At this stage,
we anticipate this will comprise three SIs in total.
12. In the first, we plan to group all the
measures relating to the new carer's credit. This will be subject
to affirmative procedure, by virtue of the measure that will define
when a person is deemed to be "engaged in caring".
13. The second (negative) SI will include
provisions that give effect to the new single contribution condition
for state pensions.
14. The second SI will also contain a number
of other measures which also come into effect on 6 April 2010
and are required as a consequence of the Pensions Act 1995 which
provides for female state pension age to increase from 60 to 65
between 2010 and 2020. These measures will include increasing
the age threshold for entitlement to Winter Fuel Payments and
the pensioner premia in the working age benefits, in line with
the increase in women's state pension age.
15. Our provisional plan is to present both
these SIs to the SSAC in May 2008. This will be under the normal
SSAC arrangements, in part because it falls outside the six-month
period, and also because not all the regulations will be made
using new powers taken in the Pensions Act. The negative SI will
be made and laid in June 2008, and referred to the Merits Committee
in the same month.
16. The affirmative SI will be referred
for informal JCSI clearance in May 2008, laid in draft in July
2008 and referred to the Merits Committee in the same month, and
made by December 2008. Both come into force from April 2010.
17. The proposals that will be contained
in the affirmative SI are currently being developed in consultation
with the lobby and Carers UK, as part of the review of the national
carers strategy. The timing of the affirmative SI is therefore
contingent on the report on the review, expected in Spring 2008.
18. The third, affirmative, Instrument concerns
Guaranteed Minimum Pension (GMP) conversion. This allows pension
schemes with liabilities for a GMP to convert these liabilities
into normal scheme benefits. The regulations will give the detail
on the method of conversion. We currently expect to be able to
consult on draft regulations in early 2008. Once we confirm regulations
we will agree an appropriate date to lay before Parliament, taking
account of Recess dates and other SIs due.
Review of Statutory Instruments
19. As Phil Wynn Owen explained to the Committee,
the Department does not have a policy of reviewing individual
instruments after a fixed period. The elapsed time between the
Act or the instrument coming into effect and policy action beginning
will typically vary greatly, according to the reforms being implemented.
So a fixed review period would not always be sensible.
20. Where regulations form part of a major
reform package, the parent Bill or associated Impact Assessment
will generally contain provisions for evaluation of either the
whole package, or parts of the reforms. The Pensions Act 2007,
for instance, includes a clause which commits the Department to
review the operations of the Act by the end of 2014.
21. Furthermore, we often pilot reforms
in the social security field. The Local Housing Allowance pathfinder
scheme preceded the national rollout of LHA in April 2008. The
introduction of Employment Support Allowance reflects lessons
learned from the Pathways project. Evidence and research from
these pilots is used to inform future policy design.
22. Larger projects will often be subject
to review and analysis. The LHA scheme will be reviewed two years
after it has been implemented.
13 December 2007
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