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Oral Answers to Questions

Volume 455: debated on Monday 8 January 2007

Work and Pensions

The Secretary of State was asked—

Benefit Sanctions

1. What assessment he has made of the impact on people from vulnerable groups of Jobcentre Plus staff targets for benefits sanctions; and if he will make a statement. (113146)

Jobcentre Plus does not operate a system of staff targets for benefits sanctions.

I wish Members a happy new year. Does my right hon. Friend agree that the principle of fairness underpins the rights and responsibilities agenda? In that spirit, to avoid claimants discovering that their benefits have been suspended only when they cannot take money out of a cashpoint, will he consider introducing a scheme whereby Jobcentre Plus directs such claimants to an independent adviser such as Citizens Advice or, in my area, Derbyshire Unemployed Workers Centre, to give them truly impartial help and support?

Yes. It is important that the eligibility rules for jobseeker’s allowance are consistently applied across the country, which is what we are trying to do. No one should find out that their benefit has been reduced, however, when they arrive at the cashpoint to withdraw it. A proper process should be followed, including a proper appeals process, and I would expect that to happen in every case.

Given that, in the United States, former President Clinton introduced the sanction of time-limited benefits, to the advantage of claimants and the taxpayer, may we assume that that option is too radical for new Labour?

We do not plan to introduce time-limited benefits, and I suspect that no Conservative Front Bencher does so either. Jobseeker’s allowance is already a time-limited benefit.

Will the Secretary of State at some stage consider the sanction of time limiting benefit? Is not it true that since we came to power the number of people in work has increased by 2.5 million, and that 2 million of those jobs have been filled by immigrants? The working age count, however, has fallen by only about a quarter of a million from 5.6 million to 5.4 million. Does not that suggest that we need to rethink radically our welfare reform programme?

Work is under way in the Department for Work and Pensions to consider the whole suite of welfare-to-work policies. It is right that we keep all aspects of those policies under review. My right hon. Friend, for whom I have a great deal of respect, urges me to pursue a course of action in relation to general time limiting of benefits that I do not want to follow. We have significantly reduced unemployment, which has benefited all our constituents, and we will continue to pursue the right welfare and economic policies to continue to reduce benefit dependency.

Last year, unemployment in Wellingborough increased by more than a fifth, and it is now more than nine years since the Government came to power. How will the Government’s policy on benefits sanctions help my constituents to find employment?

There must be a combination of the right macro and micro-economic policies and the right welfare reform policies, which make it clear to those who are claiming, for example, jobseeker’s allowance that they are required actively to seek work. When they are not doing that, such behaviour must have a proper consequence.

Child Poverty

2. What recent progress has been made in reducing relative child poverty; and what additional steps he plans to take to reduce child poverty further. (113148)

On an after-housing-costs basis, 800,000 fewer children are living in relative low-income households in 2004-05 than in 1997, and 2 million children have been lifted out of absolute poverty. Those reductions have been made possible by the introduction of tax credits, the success of the new deal and 10 years of sustained economic growth, all of which have resulted in those on the lowest incomes seeing larger proportional increases than the better-off. We will set out further proposals to reduce child poverty shortly.

I am grateful for that answer. In 2005, we were slightly behind our historic target of eradicating child poverty in a generation. Does the Secretary of State agree with the Joseph Rowntree Foundation’s research that found that we need to spend a slightly higher proportion of our national wealth to get back on track in 2010? Does he accept recommendations such as the Child Poverty Action Group’s suggestion of higher universal benefits such as child benefit, or Save the Children’s suggestion of higher targeted benefits, with seasonal grants for low-income families? What options is he considering to get back on track?

I thank my hon. Friend for parts of his question. Matters relating to child benefit, as my hon. Friend and the House will know, are for the Treasury, not the Department for Work and Pensions. As I said, we are considering a range of new initiatives to allow the Government and our country as a whole to make further progress in reducing child poverty. I want to set those out shortly.

Despite the Government’s policies, two out of every five children in London still live in households in which the adults are not working. Will the Secretary of State take the opportunity today to outline how the Government will change their policies, particularly in relation to children in London, to make them more effective in future?

The hon. Lady is right to draw attention to the particular problems of London, and I agree with her assessment. London is the richest and most productive city in Europe, yet child poverty is unacceptably high in our capital city. As I said, we will set out a range of proposals in the near future to try to address some of those problems, including the problems of London. I would not, however, want any Member to draw the conclusion from these exchanges that child poverty had increased under this Government; it has not. It has fallen significantly, at a time when national income has been rising sharply. That is the complete opposite of what happened during the 18 years of Conservative government.

Does the Secretary of State accept that child poverty and poor housing often go together? Does he agree that had new Labour built as many council houses during its first 10 years in power as the Conservative Government did during their first 10 years in power, fewer children would now be living in poverty?

Obviously, there is a connection. The Government have a strong and proud record on social housing, on which we will seek to build. However—with respect to the hon. Gentleman—these are questions to the Secretary of State for Work and Pensions, not questions to the Secretary of State for Communities and Local Government.

The Secretary of State thanked the hon. Member for Stafford (Mr. Kidney) for “parts of his question”. Which parts were they?

Last November, the Conservative party released figures showing that since 1996-97 there had been a 400,000 increase in the number of people living in severe poverty before housing costs. On 29 November, the Secretary of State responded to that by saying that income after housing costs was the proper measure, and I note that he just used that term again.

Departmental publications are very clear on the point. “Measuring child poverty” states that the Government will use a before-housing-costs measure. “Delivering on Child Poverty”, published only last November, says:

“Relative low-income households are defined as those with income below 60 per cent of … median income before housing costs.”

Will the Secretary of State make it clear whether he is telling us that he has changed his policy on the future measurement of child poverty? Is “after housing costs” now the Government’s preferred and only measure?

No, it is not our preferred and only measure. It is right that we publish both before and after-housing-costs figures; but in the case of the group to whom the hon. Gentleman refers—those on incomes that are less than 40 per cent. of the national average—it is important to look at after-housing-costs figures, because people in those circumstances are likely to be receiving help with housing costs. The hon. Gentleman has arrived at his convoluted and distorted image of poverty in the United Kingdom not by comparing this Government’s performance with that of the last Conservative Government but by citing that Government’s performance, because his figures included the last four years of their record.

With respect to the right hon. Gentleman, what we are trying to do is be clear about how the target is to be measured in future. According to the summary of households below average income consultation document, income before housing costs is the only measure of low income that the Government will use. It sounds as though the Secretary of State is trying to move the goalposts. We know the Chancellor does that when he has a problem with targets, but we did not know that the Secretary of State was on the Chancellor’s team.

Let me ask the Secretary of State about another aspect of Government policy. In a speech last month, he said that he wanted to

“shift the focus of the welfare system towards the family as a whole”.

What discussions he has had with the Chancellor about the tax credit system? According to the Joseph Rowntree Trust, a couple with two children must work for 74 hours for the minimum wage—between them—to clear the poverty line, while a single parent with one child will be comfortably above the poverty line after just 16 hours of work. That is forcing many couples to separate, to the extent that Government statisticians have created a new category—

The Government are not changing the method by which we collect and publish information on poverty, and on child poverty in particular. My comments on after-housing costs were made specifically in the context of those on below 40 per cent. of national income, which I think right and proper.

As for the hon. Gentleman’s wider questions about the tax credit system, I have had a number of discussions with my right hon. Friend the Chancellor, but I am not prepared to share them with the hon. Gentleman today.

Occupational Pensions

Because of past limitations on pensions registry data, the information requested is not available. As we explained in our November report on speeding up the winding-up of occupational schemes, the pensions regulator has sent new scheme returns to all occupational schemes, which should provide better data in due course.

That was a pretty hopeless reply. Since 1997, tens of thousands of people around the country have lost their occupational pension, including the entire work force of BUSM in Leicester, some of whom are my constituents. Will the Minister now accept, and act on, the findings of the ombudsman’s report, which rightly highlighted the responsibilities of the Government, and will he show some real compassion to those who lost all their security in old age through no fault of their own?

Of course, what was pretty hopeless was the way in which the data were collected under the Government of the hon. Gentleman’s party—and, indeed, under this Government. We are now reforming that. I agree that we should have sympathy for people who have lost their pension scheme. That is why we have introduced the financial assistance scheme—for which, I think, the BUSM scheme will qualify, so there will be some help. Most Members will agree that the Government cannot underwrite all private risk; we must not get into a situation where we underwrite in retrospect things that we did not underwrite in advance.

My hon. Friend will be aware that the Turner and Newell pension scheme is undergoing assessment for the Pension Protection Fund. I believe that the PPF will be the best possible outcome for the scheme. However, some of the work force past and present, of whom there are hundreds in my constituency, are concerned that if a better solution comes to light at the eleventh hour they will not be allowed to transfer out of the route to the PPF and to take up the new scheme. Will the Minister give an assurance that if a better solution comes to light members of the Turner and Newell scheme will be allowed to transfer to it at the eleventh hour?

My hon. Friend is right that the scheme administrators will have to do what is in the best interests of all the members of the scheme, and I want to pay tribute to the work that he has done over many years to campaign for the Turner and Newell members. That has, in part, led to the creation of the PPF, which means that people currently saving in occupational pension schemes know that there will be a safety net if such problems arise again. That is a good thing that has come out of what has happened, and which did not exist under the previous Government.

We all understand the impact that increased longevity and changes in the stock exchange and bond markets have had on the pensions industry, but what responsibility does the Minister think that the Chancellor should personally accept for destroying the aim of 30 and 40-year-olds to have a comfortable retirement?

Even the Conservative shadow Chancellor accepts that tax changes are not the main cause; as he said, the main causes were increased longevity, the fact that that was not always factored into people’s actuarial estimates and the performance of the stock market in the late 1990s, when it fell by £250 billion, which dwarfs any tax changes. What is important now is that we work for the future and ensure that everyone has access to a good employer contribution. That is exactly what our personal accounts policy will do; it will ensure that everybody, whether or not their company offers a pension scheme, will have access to a contribution from their employer to their pension, and I think that the hon. Gentleman’s party will support that measure when it comes before the House.

The ombudsman says that the Government are responsible, the Public Accounts Committee says that the Government are responsible, and even High Court judges are now saying that the Government are responsible, so when will the Government accept that responsibility and pay compensation to those such as my constituent, Bob Duncan, who has lost 30 years of contributions, adding up to tens of thousands of pounds, because of negligent Government advice?

I have great respect for my hon. Friend but I do not agree that the Government were responsible. We did not underwrite the schemes. It is right, however, that we should have sympathy for people in such situations, and I hope that his constituents will benefit from the financial assistance scheme. I would be happy to meet the constituent he mentions, if that would be helpful.

Will the Minister confirm that taxpayers are now making each year a bigger contribution to public sector final salary schemes than the entire contribution that they are making to all the private sector schemes, both defined benefit and defined contribution? On 23 November last year, his colleague the Secretary of State said that if these trends continue the Government will have to review the deals on public sector pensions. Is that Government policy now?

No, my right hon. Friend did not say that. It is right that we continue to develop the policies on personal accounts that will allow people to make contributions to their pensions, which is exactly the point that I was just making. I think that the hon. Gentleman supports that policy, although to judge from his response to our personal accounts White Paper I am not sure whether he is still part of the consensus. The one thing that we should not do, which I believe is his policy, is to take billions of pounds out of private saving and therefore undermine it. If that is his policy, he will find it pretty unpopular.

Quite a few of my constituents lost out pre-1997 when their occupational pension schemes collapsed as a result of the fall-out of the collapse of the boot and shoe industry. Will he ensure that there is no artificial cliff edge in terms of a date, and that people get proper support, whether their occupational pension schemes collapsed pre-1997 or post-1997?

That might be quite difficult. We have set out the dates that people have to meet to qualify for the financial assistance scheme, and I would be very happy to discuss with my hon. Friend the example that she gives. The key point is that there is now a financial assistance scheme that provides help. The PPF, which was not available before, provides security for people saving in an occupational scheme, so they know that there is a safety net if such a thing ever happens again.

Does the Minister agree with his right hon. and learned Friend the Minister of State for Constitutional Affairs, who told victims of the Albert Fisher pension scheme collapse that the Government were wrong to reject the ombudsman’s findings, or is this just another example of the Hazel Blears school of collective ministerial responsibility?

Actually, I agree with the hon. Gentleman’s policy, which is not to put any extra taxpayers’ money into the financial assistance scheme. [Interruption.] If he disagrees with that, he is welcome to stand up and clarify Tory policy.

Incapacity Benefit

4. If he will make a statement on progress in reducing the number of people claiming incapacity benefit. (113150)

We have already made significant progress on incapacity benefit. After two decades of continuous growth—by the mid-1990s, the number of people on incapacity benefits had trebled—inflows have dropped by more than a third. However, we have more to do, and that is the purpose behind our Welfare Reform Bill currently before Parliament.

May I take this opportunity to congratulate local DWP staff in Glasgow on exceeding their targets to cut the number of incapacity benefit cases? However, I am mindful of the fact that the Secretary of State recently said that areas with a high number of claimants often have a high number of vacancies. DWP staff in Glasgow tell me that many applicants often have problems with basic literacy and numeracy skills, and that many are reluctant to admit to having these problems. What will my hon. Friend’s Department do, working with its partners, to tackle this very serious problem and to make sure that as many benefit applicants as possible can be ready for the job market?

My hon. Friend, who is all too well aware of the situation in Glasgow, is absolutely right. Despite real and significant improvement, Glasgow still has two of the top five parliamentary constituencies for the number of people on incapacity benefit. She is also right to say that renewing personal confidence and improving or refreshing skills is key. DWP staff in Glasgow and elsewhere, and private sector providers, are working hard to ensure that such support for literacy and numeracy skills is available. I have visited a number of such projects, not least those at Glasgow Celtic and Glasgow Rangers football clubs, who, in different environments, are working together in a way that they perhaps have not always done to ensure that people’s potential and aspirations can be unlocked. Adults going into the football stadiums can learn the skills that they perhaps missed out on the first time through formal education.

It was suggested in a press release last week that single mothers with new-born babies and people with the most severe disabilities should be treated as unemployed and should be made to look for work. Will my hon. Friend the Minister join me in condemning that claim, which is being made by the Opposition?

The Minister will understand—[Interruption]—if he is listening, that the number of people claiming incapacity benefit is likely to go up as a direct consequence of the ill effects caused to them by their loss of occupational pensions. Will he please tell the House how he can on the one hand say that he is dealing with incapacity benefit, and yet on the other be part of a ministerial team that is ignoring the ombudsman’s report on occupational pensions?

I am not sure that I followed the logic, if there was any, of the hon. and learned Gentleman’s point. The incapacity benefit test is based on medical assessment, not on someone’s pension entitlement. Nevertheless, I will do him the service of trying to respond to whatever element of a question he asked. We are determined to reduce the number of people on incapacity benefit by a net 1 million over a decade. We have already made progress through pathways to work and the progressive support that has been put in place, but the Welfare Reform Bill that is going through Parliament now—with belated cross-party support—will be an important additional element of our approach of no longer writing off anybody in the labour market.

How many people have now been claiming incapacity benefit for five years or more compared with 1997? Does the Minister agree that the fact that the figures are so much higher now is a prime example of the way in which welfare dependency has become so rife under this Government?

The facts on incapacity benefit are clear. If someone is on incapacity benefit for one year, they will be on it for nine years on average. That is the nature of incapacity benefit and, unfortunately, the culture of many families. However, we are addressing that through the Welfare Reform Bill. Contrary to what the hon. Gentleman suggests about a culture of benefit dependency, 1 million fewer people are now on out-of-work benefits in the UK than a decade ago. The numbers on incapacity benefit are falling, the number of lone parents claiming income support is falling, the most recent figures on jobseeker’s allowance show that unemployment is falling and there are more people in work than ever before. That is in stark contrast to what went before during the 18 years of Conservative government.

Does my hon. Friend accept that the current system of assessment for entitlement to incapacity benefit has not been fit for purpose for many years and that therefore the new personal capability assessment, as set out in the Welfare Reform Bill, should be subject to effective, long-term and independent monitoring?

My hon. Friend speaks with great experience and authority on such matters and he is right to say that the present incapacity benefit assessment process has not served the needs of our customers or society effectively enough. In particular, it has indefensibly ignored the needs of those with learning disabilities. Work is now being done to ensure that we find a better role for those with learning disabilities in the labour market. It is essential that we have a better process to monitor the operation of the personal capability assessment and I look forward to discussing the details of that with my hon. Friend as the Bill continues its passage through the House.

Departmental Expenditure

5. What assessment his Department has made of the likely effect of planned changes in departmental expenditure on service delivery. (113151)

The Department’s planned expenditure to March 2008 was settled in the spending review 2004. Departmental performance was reported in the autumn performance report that was published on 14 December 2006, copies of which are available in the Library. Over the comprehensive spending review period in 2007, we will extend the service we provide through the introduction of the new employment and support allowance and improvements in child support and pensions.

I am grateful to the Secretary of State for that answer. My constituency is in an objective 1 area and efficiency plans from the Department and agencies that will lead to the loss of high quality jobs will deliver a bitter blow to the local economy. What will the Secretary of State do to ensure that any future plans will not have a negative impact on customer service or remove much-needed local employment in low-income areas, such as mine?

We want to provide the best possible service we can to the hon. Gentleman’s constituents and those of every hon. Member, and we work hard to try to do that. There are five Jobcentre Plus offices in his constituency, four of which are full time. One has become part time and, whenever such changes are necessary to improve the overall quality of the service we provide and achieve the best value for money for the taxpayer, we will always try to ensure that suitable and proper arrangements are in place—for example, for those of his constituents on JSA who may need to travel further to sign on.

My right hon. Friend the Secretary of State correctly announced the abolition of the Child Support Agency and its replacement by a new body that will be legally established in 2008 and operational in 2010. Will he give the House an assurance that that body will be properly resourced through his departmental expenditure, so that the problems that beset the CSA will not affect the new commission?

Yes, I can certainly give my right hon. Friend that assurance. The combined effect of the reforms will, I hope, be a drastically reduced inflow of new cases to the new child maintenance and enforcement commission. That in turn, I hope, will lead to a reduced need for investment from taxpayers’ resources in that new commission, but the resources needed to provide a proper high-quality service for all our constituents will be available.

As the Gershon review was about greater efficiency in the delivery of maintained departmental services and as we know that its implication is a net loss of about 30,000 jobs in the Department, will the Secretary of State tell the House what action he proposes, through training or other initiatives, first, to maintain staff morale and, secondly, to ensure that departmental services are not subject to further degradation?

It is possible both to reduce the total number of people employed in a Department and at the same time improve the quality of the public service that we provide. The two things are not necessarily contradictory, provided of course that they are done sensibly and properly. We are doing that. So far, I think that we have had to make only one person compulsorily redundant in the nearly 21,000 jobs that have been lost since the 2004 spending review, and we very much want to continue in that vein. In relation to the future, I agree strongly with what the hon. Gentleman said; it is important to maintain the morale of the Department’s staff, who do an excellent job in all parts of the country, and we work hard with the trade unions and others to make sure that that continues to be the case. I reassure the hon. Gentleman that maintaining the quality of the service we provide is our No. 1 priority. As well as reducing staff, we are transferring more staff to the front office so that they can deal with and interact with our constituents more directly. That is the right and proper thing to do.

Welfare Reform

7. What steps he is taking to ensure that welfare reform does not penalise (a) jobseekers and (b) claimants with mental health problems. (113153)

Our welfare reform policies are about providing people with the skills and support they need to return to work as soon as they are able to do so. Everyone will be treated as an individual and with sensitivity—no one will be forced to work at the expense of their health. The underlying principle of the reform is that rights should be balanced with responsibilities.

I thank my hon. Friend for that answer. In Hackney South and Shoreditch, we have the second highest number of incapacity benefit claimants of any London constituency, with 63 per cent. under 50, a high number of whom have mental health problems. Recently, I met some of those claimants, who have two main concerns: first, the time scale requirements for coming off welfare and going into work, which many of them want to do; and, secondly, the expertise of front-line staff at Jobcentre Plus. Can my hon. Friend answer those concerns for me and my constituents?

My hon. Friend makes a valuable point in highlighting the high percentage of people with mental and behavioural conditions who make up the IB case load. The number may not be as high across the country as it is in her constituency, but the current case load is about 40 per cent. We are conscious of the fact that people with fluctuating conditions, such as mental health conditions, need the right advice and support at the right time, as well as recognition that, as my hon. Friend indicated, there will be occasions when a job opportunity may not work. We have to make sure that we reinforce the support we give to those who find themselves in that position.

What practical steps is the Minister taking for co-ordination with the Department of Health and mental health trusts in view of the evidence that has emerged from Lord Layard and others that the introduction of more psychotherapy would greatly increase the ability to work and reduce calls on benefits?

I thank the hon. Gentleman for raising that issue, as it allows me to say that DWP Ministers and the appropriate Ministers at the Department of Health are working closely on those matters, and not only at ministerial level—our officials recognise the importance of co-ordinating our approach, because we all share the ambition to ensure that as many people as possible, particularly those who have suffered from mental health conditions for a long time, should have the opportunity to move into work.

I am sure that my hon. Friend is aware of the number of scare stories circulating about the implementation of the Welfare Reform Bill and about the Bill’s implications, particularly for people with mental health conditions. Will she take this opportunity to reiterate the fact that no person will be forced to have medical intervention to avoid their benefits being cut?

I am delighted to be given the opportunity to confirm what my hon. Friend has said. My hon. Friend the Minister for Employment and Welfare Reform and I confirmed it in Committee, and I am delighted to do so again on the Floor of the House.

Disabled People

I am pleased to advise my hon. Friend that the disability equality duty, which took effect on 4 December, will mean significant improvements to services for disabled people. My Department’s first disability equality schemes were published on 1 December, and they set out actions that we intend to take over the next three years to improve services for our disabled customers.

I welcome the answer given by my hon. Friend. I am sure that those of us who have a passionate interest in equality will welcome the huge progress made in this area over the past 10 years. Will she describe what impact she expects the new disability equality duty to have on services provided by local authorities, as many disabled people across the country receive such services?

It is crucial to highlight, as my hon. Friend has done, the importance for disabled people of local authority services across a range of activities. Most local authority people would accept that services were often geared to the provider and not to the individual. I hope that the new disability equality schemes, some 44,000 of which have been published, will allow local authorities, and public authorities in general, to review how they provide services, as they are legally obliged to do, and how they involve disabled people in the development of those services—they should not be involved only at the end of the process.

My hon. Friend will be aware that many disabled people are either denied or obstructed from using services simply because able-bodied people park their cars in restricted disabled bays. Given that local authorities and the police are somewhat limited in what they can do to stop this bad practice, will she offer any encouragement to disabled drivers who suffer the frustration of it?

I do not know what my hon. Friend is asking me to encourage disabled people to do. In a recent case, somebody let down the tyres on the car of someone who had parked in a disabled parking bay, but I would not recommend such action. However, he raises an important issue: if we accept as individuals that disabled people have the right to access services through the provision of specialist parking places, it is incumbent on all of us to recognise that such a service is provided specifically for disabled people, and that non-disabled people should not nip in and out of disabled parking spaces to suit their convenience. People should allow the serious mobility issues that the blue-badge scheme and similar schemes are meant to address to be dealt with.

The Minister referred to the responsibility of local government in reply to an earlier supplementary. She was right to do so, but if local government is to meet its obligations under legislation passed by this place, is it not essential that it should receive adequate resources to enable it to do so? Even if it wishes to raise money through the council tax, it is limited by capping, so it is in grave difficulty in dealing with these important groups of people.

First, I hope that the hon. Gentleman and most others in the House would accept that this Government have invested in public services provided by local government. May I say to him that on the disability equality duty and the disability equality schemes, there is not necessarily an issue of finance? There is an issue of culture and process, and this is about getting public servants—be they in local authorities, the police service or the health service—to recognise that they need to involve disabled people at the beginning of their policy planning and not at the end.

We are trying to shift the balance away from provider-led services, which say to disabled people, “You will take what you can get and be thankful for it,” to a process that involves disabled people from the beginning. That is what the disability equality duty is intended to do. It is not a matter of money.

Could we not improve services for disabled people by working even more closely with specialist voluntary sector organisations such as DIAL UK, which runs disability information and advice lines? Should we not require each local authority to employ a designated access or disabilities officer, especially given their new responsibilities? Many local authorities do not employ someone with that specific responsibility. Will the Minister discuss the matter with the Secretary of State for Communities and Local Government?

In fairness, many public authorities have started to consider how to put in place people with a special and specific responsibility for disability equality. To echo what I said to the hon. Member for Macclesfield (Sir Nicholas Winterton), the issue is not just about giving responsibility to one person within a public authority; it is about a change of culture, and embedding disability equality within public authorities. That is what the disability equality duty is about, and that is why the disability equality duty was agreed to overwhelmingly as part of the Disability Discrimination Act 2005.

Payment Fraud and Error

9. What steps he is taking to reduce fraud and error in relation to income support, jobseeker's allowance and pension credit; and if he will make a statement. (113155)

We have made significant progress in reducing fraud and error in income support, jobseeker’s allowance and pension credit. In fact, fraud in income support and jobseeker’s allowance is at the lowest level ever recorded; it is down by almost two thirds from 1997-98. We are determined to reduce both fraud and error even further, and we will publish our strategy for reducing error in the very near future.

The Government admitted at the end of last year that in the past three years, due to fraud and error, they wrongly paid out £13 million in benefits to prisoners, and they also admitted that the problem is getting worse. Is that a result of fraud, incompetence, or a combination of both?

The figure to which the hon. Gentleman refers relates to estimates of overpayments, accumulated over three years. In his allegation about overpayments to prisoners, he overlooks the Department’s success in identifying overpayments and recovering them.

My hon. Friend will realise that there are different performance levels in different regions. What action is he taking to ensure that best practice, and therefore the lowest error and fraud rates, are rolled out across the country and become national practice?

My hon. Friend makes a good point. If we consider the performances of individual offices across the country, especially in respect of official error, we find different levels of performance, as he says. The Department is trying to put in place a twinning arrangement between the best performing offices and those that are still not performing as well as we would like, in order to ensure the spreading of best practice around the system. I am confident that that will help us to make even more progress in reducing error.

The total cost of customer fraud and error for the three benefits in question alone is over £500 million a year. A staggering £100 million a year of that is down to people claiming to be single, when they live with a partner. That is because the system sends the message: “Pretend to be single, and you’ll get much more benefit than you would as part of a couple.” When will the Minister get a grip on that dysfunctional system, and end the damaging discrimination against couples, both married and unmarried?

That is a bit rich coming from the Opposition. I remind the hon. Gentleman that, for the benefits concerned, the amount of fraud was £850 million in 1997, but it is now £250 million. The figure for official error was £280 million, but it is now £230 million, so right across the piece, on fraud and on error, the Government have made far more progress than was ever made under the previous Administration, and we will continue to do so.

Winter Fuel Allowance

The Government keep all tax and welfare policies under review and any changes are considered as a part of the normal Budget and spending review processes.

I thank the Minister for that answer. He will be aware that a coalition of charities called for an extension of the winter fuel allowance to those people under the age of 60 who are particularly vulnerable in cold conditions and who receive long-term benefits. Indeed, the Government’s own energy review accepted that there was a problem in that area. Has the Minister pressed the Chancellor to use some of the massive £1 billion increase in VAT receipts, arising from the increase in fuel bills over the past year, to extend the winter fuel allowance to such groups?

That is not my ministerial responsibility, so it is not my job to do so. The key things are that recent falls in wholesale prices should be passed on to customers soon and that we protect the most vulnerable. I remind the hon. Gentleman that in 1996, only £60 million was spent on the problem, but now more than £2 billion is spent on it. I am sure that he welcomes that.

Will the Minister congratulate the excellent regional and county newspaper, the Leicester Mercury, on its campaign to highlight the fact that, given the inflation in energy prices, the winter fuel allowance buys rather less fuel than it did when it was set? It has urged county MPs to make a submission to the Chancellor—possibly the future Prime Minister—and I have agreed to do so. Will my hon. Friend allow his signature to be added to my letter?

I think that I would probably have to resign from the Government if I did that, so no, I will not give my hon. Friend that promise. The winter fuel allowance has increased far faster than inflation and energy prices. It was £20 when it was first introduced, but it is now over £300 for people over 80, which is a much faster rise than the increase in utility prices. The key thing is that the cuts in wholesale prices are passed on to customers, particularly the most vulnerable, as soon as possible.

Pensions Bill

We published the Pensions Bill on 29 November. We have received, and continue to receive, a wide range of representations. We have also met, and continue to meet, a wide range of stakeholders to discuss our proposals.

What discussions has the Minister had with the Chancellor of the Exchequer about people who have made voluntary national insurance contributions and will not benefit from the new arrangements in the Bill? Is there not a strong case for those contributions to be refunded?

We have worked closely with Her Majesty’s Revenue and Customs on the issue. From the moment that they were put into the public domain, we wrote to people alerting them to the proposals, which appeared first in the White Paper and are now in the Pensions Bill. Obviously, we cannot take Parliament for granted and start to change the rules before the law is changed. We must change the law first, and that is the stage at which we will be able to make the change that the right hon. Gentleman suggested. The precedent, under both the previous and present Governments, is that contributions paid at the time should not be refunded, otherwise every time that we introduced a social security policy change we would have to make changes backdated many decades.

Will my hon. Friend accept a representation from me, and agree not to set any artificial capping on pension fund surpluses, as introduced by Nigel Lawson in the 1986 Budget? Does he not agree that that was the beginning of a difficult period for pension funds, and that such changes should be avoided?

My hon. Friend is right. That restriction on surpluses has, in fact, been removed by the Government. He is right, too, that those pension trends have been under way for many years. The number of people in occupational pension schemes fell under the previous Government, and that has been the case, too, under the present Government. It is important that we work on a policy to make sure that everyone has access to employer contributions to their pensions, and that is exactly what we are doing through personal accounts.

Child Support

Following publication of the child maintenance White Paper on 13 December, a formal consultation is now under way that will end on 13 March. A report will be published following the end of the consultation detailing the representations received. As of 5 January, we have received 49 representations.

I am grateful for that reply, but the reforms are rather late in the day. More than 750,000 child support cases remain unresolved, and £3.5 billion of debt is outstanding. How will the reforms improve a system that has been dormant for so long?

The hon. Gentleman should look at the White Paper, where he will find the answer to his question. The reforms will work in two ways. First, £120 million has been allocated to the operational improvement plan. The money is already going in, and improvements have been made. The backlog to which he referred, for example, has been reduced. Secondly, in the long term, the move to a system in which parents are encouraged to reach voluntary agreements on child maintenance, together with a more generous maintenance disregard for income support purposes, will produce a much more efficient and effective child support system, as well as one that is better administered.

Welfare to Work

I am delighted to say that the city strategy pathfinders have now submitted their delivery plans. We are considering all the plans, including Nottingham’s, my hon. Friend will be pleased to know, and will make announcements shortly.

I hope that the House will forgive me for teeing up this month, as in previous months, an opportunity for the Minister to let the House know about the flexibilities in the welfare to work scheme. As the Prime Minister, the Secretary of State and the Minister have all underlined, it is important that such schemes are allowed great local and personal flexibility, not least in the ability to carry over savings that have been made under the welfare to work scheme. Will my hon. Friend inform the House whether any progress has been made in the past month?

This is the third month in a row that my hon. Friend has doggedly persisted in asking that important question. I can confirm that during the Christmas and new year break, officials and I have been looking at the detail of the submissions from city strategy consortiums, including proposals to devolve resources and proposals for local branding and more flexibility in training. It is an important package of requests, and our approach is that the city strategy will be an important devolved platform for the delivery of not only these plans, but an increasingly localised and personalised welfare state over future years.

Means-tested Benefits

14. What discussion his Department has held with interested parties on the number of people likely to be subject to means-tested benefits under the Government’s state pension reform proposals. (113160)

It is estimated that up to 45 per cent. of people will still qualify for pension credit, a means-tested benefit, by 2050. How can people be encouraged to save for retirement, when it seems that means-tested benefits will remain such a central part of the Government’s future pension strategy?

I do not think that any party in the House has a proposal to abolish means-testing in the system entirely. The proposals will reduce the level of means-testing to about a third. We are confident that those are the right figures. The proportion of people on 100 per cent. withdrawal rates is much lower now than under the previous Government, so real progress has been made. We believe that personal accounts will be a very good way for people to save.

Leader of the House

The Leader of the House was asked—

Wars: Parliamentary Approval

20. What representations he has received on proposals for requiring the House’s approval for going to war; and if he will make a statement. (113138)

I receive many informal representations on this matter. In their November response to the Lords Constitution Committee report “Waging War: Parliament’s Role and Responsibility”, the Government said that they were keeping their policy in this area under review. I think the whole House will agree that we have to ensure at all times and in all circumstances the safety of our service personnel, but subject to that and to emergency situations, I cannot conceive of a situation where the Commons should not have a key role to play in decisions in respect of going to war.

The Leader of the House knows that since the beginning of the Iraq war, members of parties in all parts of the House have signed Remaining Orders which highlight the difficult situation facing any Government in consulting any legislature in any democracy about going to war. Will he take it from me that many of us appreciate the thought that he is giving to the matter, and that there must be some sort of formal settlement—some sort of procedure—which involves the Executive having the flexibility and the nimbleness to respond to aggression whenever necessary, and which recognises the needs of a democracy to ensure that a legislature can at least endorse that very important decision to take a country to war?

In return, I thank my hon. Friend for the seriousness and care that he is taking on the matter. When I used that phrase, I was in many respects echoing the words of my right hon. Friend the Prime Minister before the Liaison Committee in early February last year, when he said:

“The fact of the matter is that I cannot conceive of a situation in which a Government”


“go to war . . . without a full parliamentary debate.”

That is in practice the convention that we have established. The issue remains whether that convention should be formalised or should be left, as many conventions are, as conventions.

I, too, welcome what the Leader of the House has said. However, will he forgive my saying that it is not a convention yet? We need a formal expression of what he has said either by way of a clear convention in this House or by way of statute.

I think that it is becoming a convention. In a different context, the Joint Committee on Conventions has said that conventions are, by definition, difficult to codify. However, the Lords Constitution Committee has ruled out the possibility of a statutory arrangement and has suggested that the situation should be bedded down by way of a resolution of each House or particularly of the Commons, since it would be for the Commons to make the final decision. We are looking at that matter with care.

I welcome what the Leader of the House has said, but surely it is implicit that as well as there being an affirmative resolution of the House of Commons to deploy troops, there needs after some years of deployment to be a reaffirmation of that decision by a vote in this House. And if we ever have to do this again, there needs to be an institutional mechanism by which this House has direct access to the security and intelligence services, because such information should not be given to us by Ministers.

They are two different things. There has been no military action, approved by this House or not, that has not been subject to the most extensive inquiry afterwards, which is the case with Iraq. Although my hon. Friend is not terribly keen on the Intelligence and Security Committee—

In one sense, it goes one better, because its establishment was agreed by Parliament and was enshrined in an Act. As anyone who has appeared in front of the Intelligence and Security Committee will tell my hon. Friend, the Intelligence and Security Committee operates as least as effectively as a Select Committee.

I, too, welcome the thoughtful way in which the Leader of the House has responded to the question. However, the decision to go to war is just one of the general prerogative powers exercised by Ministers. Will the Leader of the House accept that there is widespread concern that we need to redress the balance of power between Parliament and Government and that the balance of power has tipped too far in the Executive’s favour? If so, why have the Government so far refused to act on the recommendation of the Public Administration Committee, which stated in 2004 that the case for the reform of prerogative powers is “unanswerable”?

Quite rightly, prerogative powers have been reduced over time, because they go back to the period before the Glorious Revolution of 1688 and are, by definition, rather anomalous. There are some areas in which those powers are easy to replace by statute, which has been going on. The powers exercised by prerogative are subject to much greater constraint by statute now. For example, I refer the right hon. Lady to the Human Rights Act 1998, which has made considerable statutory inroads into the previous exercise of discretion by Ministers. The situation happens to be more difficult in other areas. It is important to put the power of this place into proper perspective. In a recently published study, a former parliamentary clerk has pointed out that the powers exercised quite properly by this House over Governments are now far more extensive than they were, for example, 40 or 50 years ago.

We know what the Leader of the House really thinks, because in 1994 he said that

“the royal prerogative has no place in a modern democracy”.

I welcome what he has said, although I shudder to think that the convention is bedding in by there being more wars and therefore more parliamentary approval. Is it not extraordinary that in the United States, which is a democracy with an Executive President, war-making powers must be approved by the legislature, but in this country, where the Prime Minister and his colleagues derive their authority from this House, there is no formal arrangement for our agreement?

First, let me say to the hon. Gentleman that it was this Government and this Prime Minister who ensured for the first time, back in September 2002—when the possibility of military action was there, but by no means a probability or a certainty—that in the event of a Cabinet decision to take military action, that would have to be endorsed by this House before it came into force. This Prime Minister did that; previous practice had been very varied.

Secondly, the hon. Gentleman should not look at the practice in the United States through rose-tinted spectacles. The truth is that it has been the subject of enormous controversy there. It is not the case that what anybody else regards as war has to be, and has been, the subject of prior decision by the United States Congress. As it happens, our practice is consistent with that of, for example, Australia and Canada. When we are moving in this direction, we need to take account of the fact that in Europe, where there is, as we accept, tighter parliamentary control, that has in some cases acted unnecessarily and irresponsibly to restrict the proper discretion of the military. We can move forward on this, but it requires a sensible approach on both sides of the House.

House of Commons Commission

The hon. Member for North Devon, representing the House of Commons Commission, was asked—

Fair Trade Products

21. What proportion of products sold on the parliamentary estate were fair trade in 2005-06 and 2004-05. (113139)

As on a previous occasion when the hon. Gentleman asked a similar question, it is not possible to give a single overall figure within its terms. As he knows, the Fairtrade Foundation lists only a rather limited range of products available through catering distribution and supply in London. However, I am pleased to say that the House has spent about £45,000 on fair trade products since April and a further £40,000 on souvenir products from various ethical initiatives. The Refreshment Department is re-tendering for the supply of coffee to the House and has specified that all coffee must be approved by the Fairtrade Foundation.

More than 5 million people in Africa, Asia and Latin America have benefited from the sale of fair trade products, some 1,500 of which are available in the United Kingdom. Does the hon. Gentleman agree that we should be setting an example in the Palace of Westminster, that we should have more products available, and that we should have a minimum target for such sales?

I certainly agree with the hon. Gentleman about the benefits of the Fairtrade Foundation. As I said, only a limited range of products is available through the catering supply industry. Retail sale is a different issue in which the House is not involved. We are buying, where available, in all product categories bar one, and doing all we can to increase the volume of fair trade produce as time goes on.

Energy Efficiency

A campaign to raise awareness of environmental issues has been running for more than a year to encourage people to switch off unnecessary equipment and lighting. The campaign has included regular presentations, guest speakers, two exhibitions and articles in the staff magazine, “inHouse”. It is reckoned that the most cost-effective way to control unnecessary lighting is for people to switch off lights when they leave rooms rather than to have automatic light systems that allow a time delay before switching lights off automatically.

I do not know who is responsible for keeping the lights on in Star Chamber Court throughout the day under the very expensive £450,000 glass canopy, but could they be instructed to turn them off during the day? For a Parliament that is meant to be interested in climate change, a remarkably large number of lights are left on throughout the daylight hours.

I will take note of the hon. Gentleman’s specific point about the covered walkway and ask for officers to investigate that. I repeat that the most effective way to save electricity is simply for everybody on the estate to be more diligent about turning lights off.