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Supplementary Benefit (Amendment) Bill

Volume 375: debated on Monday 18 October 1976

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7.11 p.m.

My Lords, I beg to move that the Bill be now read a second time. I think I can say that this Bill is a simple one with just two objects. The first is to increase the amount that a lone parent can earn without affecting the amount of his or her supplementary benefit. The second is to remove a small anomaly on the treatment of certain aspects of widows' pensions and allowances for the purposes of supplementary benefit.

Before dealing with the first aspect—the part which relates to the lone parent—perhaps I ought first to say something about the place of disregards in the supplementary benefit scheme. In looking at the disregards, one must always bear in mind that the object of the scheme is to bring a person's existing income up to the level of his requirements. If he already has a sufficient income, from whatever source, to meet those requirements then it could be argued that no supplementary benefit is necessary. On that basis, a person whose requirements are £20 a week and who already has an income of £20 a week would not qualify for supplementary benefit. It has, however, always been recognised that to take every penny of earnings into account would be much too harsh and that it is reasonable to disregard a certain amount of earnings in order to enable people who have to depend in the main on supplementary benefit nevertheless to make some additional provision for themselves. At the same time, it must be acknowledged that to allow too high a disregard would make nonsense of a means-related scheme, if, as a result, people were to be paid benefit whose income far exceeded the supplementary benefit level. It is against this background that increases in disregards must be considered.

The present position is that single parents, like most other supplementary benefit claimants, can earn up to £4 a week without their benefit being affected. Claimants required to register for work, that is, broadly speaking, the unemployed, can have up to £2 of earnings disregarded. If there is any excess of earnings over the disregard limit, the benefit is reduced by the amount of that excess. In a two-parent family on supplementary benefit, the mother can earn up to £4 and the father—assuming he is unemployed—can earn £2. That is a total of £6 without the family's benefit being affected. A one-parent family is therefore somewhat at a disadvantage because, as there is only one wage-earner, the total earnings disregarded (apart from those of children which are always totally ignored) cannot be more than £4. But there are other reasons why a higher disregard is appropriate for single parents. As the Finer Report said, the disregard:
"helps parents who can do the occasional or small job while spending most of their time looking after their family and who may thereby obtain sonic personal satisfaction and increased social contacts as well as a little extra income".
From every point of view it is desirable to encourage the mother who has had to give up work while her children are at school to get back into the employment field and begin to equip herself for an active and full life in her middle years. It is unfortunate if lone parents become so accustomed to life on supplementary benefit that even when they could go back to work and earn a good living they feel it is not worth taking the touble and therefore become permanently dependent on supplementary benefit.

At present the number of single parents taking advantage of the disregard is low. Only 11 per cent. of those on supplementary benefit are known to have any earnings, though there may, of course, be more who, from time to time, earn amounts not exceeding £4 a week which they are not required to report. Our hope is that a 50 per cent. increase in the amount of earnings that can be disregarded will result in an increase in the number of single parents who may choose to undertake part-time work, particularly as the employment situation improves.

We carefully considered whether we should increase the disregard even further. One limiting factor here would be the cost. We estimate that the proposed increase in disregard from £4 to £6 per week will cost about £1¼ million in increased benefit paid in a full year to those whose earnings exceed the present disregard of £4. There is also likely to be some unquantifiable extra cost through additional people being attracted to claim benefit. But, quite apart from the cost, it would not be equitable to allow the disregard for single parents to go too far ahead of the earnings disregard for other recipients of supplementary benefit. I have in mind pensioners, disabled people and their wives.

Before moving on to the second part of the Bill, I should like to mention a particular point which arose at the Report stage of the Bill in another place. This related to the position of a single parent who, while not actually living in the same household as his or her child, nevertheless has the day-to-day care of the child who may, for example, on account of accommodation difficulties be living with the claimant's mother. An undertaking was given that in these somewhat rare circumstances the claimant would not lose the benefit of the additional earnings disregard simply because the child was technically in another household. I can now confirm that the instructions issued to the supplementary benefits commission staff for operation after this Bill has been passed ensure that in such cases as this the parent's earnings will attract a higher disregard just as they would if the parent and the child were in the same household.

My Lords, I now come to the second part of the Bill which provides for the discontinuance of certain small disregards attached to the children's portion of widow's pensions and allowances. The pensions and allowances involved are National Insurance widowed mothers' allowance, industrial death benefit and war widows' and similar pensions. I must say first something about how these disregards originally came to be included in the scheme. In 1964, in the days of National Assistance, on increase was being made in the children's allowances attached to widow's pensions at a time when no other benefit changes were taking place. In order to avoid a situation where those widows receiving National Assistance would not benefit from the increase, it was decided that the amount of the increase, 7s. 6d. for each of the first two children and 5s. 6d. for each subsequent child, should be disregarded in calculating National Assistance. The disregards have continued since then and on decimalisation became 38p each for the first two children and 28p for each subsequent child.

However justifiable the introduction of the disregards may have been at the time, they have remained an anomaly ever since. This is because the general principle, both of National Assistance and supplementary benefit, is that the main National Insurance benefits—which are intended as the principal support of those who, for one reason or another, are unable to work—should be taken into account in full when assessing the extent to which they should be supplemented by what is now supplementary benefit. To do otherwise is really to provide twice over from public funds for the same purpose.

When introducing the supplementary benefit scheme in 1966 the Government did not think it practicable to abolish these small disregards that had so recently been introduced and they were allowed to remain. However, we think that the time has come to end this anomaly which is also an unnecessary complication of the supplementary benefit scheme. It seems right to the Government to make this legislative change in conjunction with the increase in the earnings disregard which will be of potential benefit to all one-parent families. We propose therefore to discontinue these disregards for future supplementary benefit claimants who have children's allowances attached to widows' pensions.

I would strongly emphasise that the existing claimants who already have the benefit of the disregard will not lose it. The Bill provides the disregards to be retained for all those who have what are to be known as "preserved 1976 rights". All those claimants who now have the disregards will continue to have them for as long as they continue to receive supplementary benefit in conjunction with the widows' pension or benefit involved. If supplementary benefit ceases because a widow enters hospital, that gap in entitlement will not affect her preserved rights. Neither will other gaps in entitlement, due, for example, to spells of employment, if they are not longer than three months.

The provision of these preserved rights will mean that it will take some time for the disregards to work fully out of the system and it is not until they do that the Exchequer will benefit by a mere £ ½ million which it estimated will be saved eventually. The Government recognise that this Bill is a modest measure but I nevertheless commend it to your Lordships as a worthwhile one. Not only will it tidy up the anomaly I have mentioned, but it will bring immediate benefit to those lone parents receiving supplementary benefit who are already earning more than £4 a week. We maintain that it will also help future lone parents who receive supplementary benefit by making it more worthwhile for them also to take up part-time employment. We believe that this is a right measure. I commend it to your Lordships.

Moved, That the Bill he now read 2a .—( Lord Wells-Pestell.)

7.25 p.m.

My Lords, I should like to begin by thanking the noble Lord, Lord Wells-Pestell, for introducing this short but important Bill this evening and for his very clear explanation of it. As I understand the Bill, it does two things. First, it enables single parents working part time to earn up to £6 a week before their supplementary benefit is affected in any way. Only those working part time are entitled to supplementary benefit. It is thought that the Bill might apply to about 15,000 single parents. They will gain this benefit after 15th November. Secondly, Clause 1, subsection (2), takes away from the widows' pension certain disregards for children which are included in the pension when calculating a widow's entitlement to supplementary benefit. I was very glad to hear from the noble Lord that no widow who at present has this right will lose it. As I understand it, over a period of time this will gradually work its way out of the system so that everybody will be treated in a similar manner.

We on this side of the House will not quarrel with the principle behind the Bill. Indeed, we shall wish it a speedy and smooth passage through your Lordships' House. This Bill is therefore in marked contrast to a great deal of the other legislation that is going through the House. This is so because we support very much the reasons that the noble Lord, Lord Wells-Pestell, has given us for the Government's introducing the Bill in the first place. It is obviously very valuable to an individual, especially to a single parent bringing up a family, and a young mother, to have the advantage of going out to work part time, getting used to working, meeting other people, leading a more normal life and so preparing herself for the day when she can do a full time job.

Furthermore, we believe very strongly that it is important that those who can earn should be encouraged to do so and should not find themselves caught once again in the poverty trap by discovering that the more they earn the more they lose by way of benefit and there is a positive discouragement to work and to earn and it is to their advantage to stay at home and be supported entirely by the State. I was disappointed to hear that at present only 11 per cent. of those on supplementary benefit earn anything at all and that they would be the kind of people who would be likely to take advantage of this. I hope that the noble Lord's predictions come true and that a much higher percentage will seek work as a result of the passage of the Bill.

My Lords, I should like to make a number of general observations about the Bill. The first is about the Bill itself and it is to question the complexity of a short Bill such as this one. It consists, after all, of only two clauses with a short Schedule, yet the whole Bill works by reference. In order to do my homework as adequately as I felt I should, I tried to find the Act referred to in Clause 1, subsection (1), called the Supplementary Benefit Act 1966. All that the Printed Paper Office could find for me was a Bill entitled the Ministry of Social Security Act 1966. It so happens—I hope I have the correct reference—that this is a Bill which in fact established the Ministry of Social Security and the principles of supplementary benefit. It appears to me that in fact the references in the Bill worked perfectly well in the one that I have in my hand. Nevertheless, it seemed strange that the name was not the same, and I wondered whether there was another Act that I should have got hold of, or whether I was working from the correct one. That indicates how very complicated the whole matter has become. Surely there was a simpler way of raising by £2 the entitlement to benefit for the single-parent family on supplementary benefit who wishes to earn. That is what we are talking about, and I am bound to say that this is a very complicated way of going about it.

I have long believed, as a matter of principle, that social workers and others who will be responsible for administering this type of legislation should understand the Acts of Parliament under which they work, and which they are administering for the benefit of others. I am bound to say that this little Bill adds to the complications. I do not know whether the noble Lord found it as difficult to read as I did, but no doubt he had many people to brief him. However, I am bound to say that I found the two clauses very heavy going. That is my first general point, and I hope that in the not too distant future we may see some kind of consolidating legislation which sets out all these things very clearly.

My second point is that it is much to be hoped that the House will have an opportunity of debating the Finer Committee Report on One-Parent Families, published very nearly two and a half years ago. I have noticed that the noble and learned Lord, Lord Simon of Glaisdale, has indicated his intention to introduce such a debate and notice of it has been on the Order Paper for some time. I hope very much that we shall have it in the near future, possibly in the New Year. In the meantime, this Bill gives us an opportunity to say something, albeit briefly, about one-parent families, for the fact is that their number is growing.

I understand that after the pensioners and those who are unemployed, single-parent families make up the largest group in society still on supplementary benefit. As I have already indicated, the system of giving benefits has become increasingly complicated and, as Professor Donnison has indicated in his recent report on the whole supplementary benefits system, the system needs to be overhauled and simplified. I think further that it is disgraceful that the new child interim benefit which begins in April is so complicated that a voluntary organisation has had to write a guide to it. Otherwise, some single parents might not have appreciated that they would be worse off after claiming that benefit than if they had not claimed it at all.

The Government have done nothing for one-parent families; they have rejected the guaranteed maintenance allowance which was proposed by the Finer Committee; they have not done anything about reforming the law as proposed by Finer; and, so far as I know, they have not gone any further on the subject of family courts. It therefore seems to me that, in the present very difficult economic circumstances and, as we all hope, when the economic circumstances get better, the right answer to the type of problem which this Bill is designed to meet and which faces one-parent families must be to reduce dependence on supplementary benefit and restore the incentive to work. Certainly, when supplementary benefit was introduced, or, indeed, when National Assistance was first introduced, it was not expected to benefit more than a very small number of people. It is therefore very disturbing that the numbers on supplementary benefit should have increased year by year in a way that was never intended—certainly not when the Beveridge principles were first introduced.

It seems to me that it would be right for the Government to introduce a proper child benefit scheme in April 1977, and not, as they at present propose, some time in 1979/80. Such an introduction would not cost more money and would be of immediate help to mothers. By abolishing child allowances, such a scheme would, I appreciate, have the effect of transferring the money from father's pay packet to mother's handbag. Nevertheless, it would not be costly and would, I believe, be of particular benefit to one-parent families. I think, too, that the Government ought to consider introducing some form of tax credit scheme under which the one-parent family would receive the married credit. Certainly, this was one of the recommendations of the Finer Committee Report and would, I believe, be of great value to the one-parent family.

I appreciate that the Government have provided an additional personal allowance for the single parent which is equivalent to the difference between the single and married tax allowances. However, it will be evident that there are two drawbacks to the scheme. The first is that it is obviously of no help at all to those whose income falls below the tax threshold; and, secondly, the advantage of a married tax credit scheme is that it gives a positive tax gain to those below the tax threshold. Therefore, what the Government should do is to raise tax allowances and reduce the rate of income tax so that the incentive to work is stronger.

It is quite clear, in our present economic difficulties, that this can be done only after public expenditure has been reined back. But the position in which we find ourselves, and to which the Government have contributed, is that the Government have been moving in precisely the opposite direction; that is to say, they have raised the rate of income tax from 30 to 35 per cent. and, at the same time, there has been a dramatic fall in the real value of tax allowances. It is a conjunction of all these events which produces the circumstances in which, in so many cases, it is better not to work than to work, and which produces the circumstances in which those who are least well off in society are not being helped as adequately as they should be.

Before concluding, I should just like to comment on two further points. First, I was very glad to hear from the noble Lord, Lord Wells-Pestell, that the point raised on Report stage in another place by my honourable friend Mrs. Chalker, as to the circumstances of a family in which the child is living with a grandparent and the mother is going out to work, is covered by this Bill, because these seem to me to be circumstances which must be very common in a number of families. I was very glad to have that point confirmed by the noble Lord. The second point is on paragraph (c), at the top of page 2, which makes it quite clear that the cohabiting rules are still to apply as before. It seems to me that this is a matter which has been discussed so many times, and which creates so many difficulties about trying to prove precisely when people are cohabiting and when they are not. I am sorry to see that it appears yet again.

This Bill provides us with an opportunity to consider, albeit briefly, some of these wider issues. I make no apology for raising them this evening, because they are all of very great importance. As the economic situation worsens, it is always the weakest and most vulnerable members of society who are the most affected and we should do anything we can to help them. It is for that reason that I, and my colleagues on this side of the House, support the principle of the Bill, but we see it in conjunction with a firm Government policy on inflation, because that is eating away at the money which anybody receives; it is eating away at savings and earnings of any kind and, of course, it is most damaging to those least able to support themselves. The Bill does no more than alleviate one situation. It does not go to the root of the matter and attempt to put it right. Nevertheless, because it is a step in the right direction, we on this side of the House will support it.

7.39 p.m.

My Lords, the noble Lord, Lord Wells-Pestell, has explained the provisions of this Bill with his usual lucidity, and I join the noble Baroness, Lady Young, in thanking him for that. The Bill is welcome so far as it goes but, as the noble Lord made clear, it does not go very far. The increase in the earnings disregard for one-parent families from £4 to £6 makes the disregard the same as could be obtained in certain circumstances by a two-parent family, as the noble Lord pointed out. But it will touch only the fringe of the problem of one-parent families. As the noble Baroness said, I believe that some 15,000 out of a total 65,000 one-parent families claiming supplementary benefit will be affected. I understand that 43 per cent. of single parent families are on supplementary benefit and are one of the largest single group of claimants. It follows that of the 280,000 single parents claiming supplementary benefit only 15,000 will benefit from this Bill. I do not say that in order to decry the increase in the disregard for single parent families, although in view of the inflation in recent years I feel that if the increase is to be a worth while one in real terms the disregard should be larger. The proposed increase is a very small measure to help a few, and wider measures are necessary.

The Bill implements Recommendation No. 121 of the Finer Report but there are two further recommendations in that Report with regard to supplementary benefit which I wish were in the Bill. The first recommendation was that there should be a short waiting period for long-term benefit rates to take effect, that the waiting period should be reduced from two years to one. The second was that there should be an additional supple mentary benefit allowance for one-parent families which at present prices would be £2·50 per week and would cost £35 million. The Finer Committee were convinced that by and large one-parent families have more than proportionate costs when compared with two-parent families, and that this required special measures of alleviation.

As the noble Baroness has pointed out, the main Finer recommendation was a guaranteed maintenance allowance which, among other things, when combined with the rather limited tax credit scheme envisaged in the Green Paper by the Conservative Government, the Committee estimated would have taken most one-parent families off supplementary benefit. Such allowance could no doubt do the same if combined with child benefit, although it would need to be much larger than child benefit, since this, at least initially is very small being £1·50 for a single-parent family under the interim benefit now being paid and which rate will continue in 1977.

The objection on the part of the Government to implementing such a scheme will be one of cost and administration. During the Second Reading debate in another place, it was stated that it would cost between £250 million and £400 million and involve 8,000 extra staff. It is difficult not to sympathise with the Government when faced with those figures in our present economic situation, but if we must wait for help on that scale, though not necessarily in the precise form advocated by Finer, that makes the case for the additional supplementary benefit allowance that much stronger.

Objection has been made to the fact that the guaranteed maintenance allowance as proposed by Finer would be means tested in respect of the adult portion although not of the child's portion. I am convinced that the proper answer is a tax credit scheme in which there would be a one-parent family credit. The important condition is that the total credits available to the one-parent family under such a scheme must exceed the general supplementary benefit level so that the vast majority are removed from supplementary benefit altogether.

Turning to the other aspect of the Bill, the proposal to eliminate for new claimants the disregard to tax for National Insurance widows benefit seems to be logical and I have no objection to it. In conclusion, I would say that this is a small Bill of limited application, acceptable and even welcome so far as it goes, but in no way making a major contribution to solving the financial problems of one-parent families.

7.45 p.m.

My Lords, as my noble friend said, we hope that this Bill will prove a useful contribution towards solving a very difficult problem. It seems to me that we are all in the awkward position that while we would like people to have as much as possible, inflation is all the time present and money goes down in value; and to raise allowances only makes the situation more difficult and the problem almost insoluble. Nevertheless, this Bill is a step in the right direction and I would congratulate the noble Lord, Lord Wells-Pestell, on having brought it forward. I hope that it will have some effect.

The fact that only 11 per cent. of people who are eligible for this kind of benefit ask for it or get it is a criticism. It is a criticism of the complications involved. Many people do not understand how to go to the Social Service office and ask for this, that or the other supplementary benefit to which they might be entitled; so they do not claim. I have found that to be so with allowances which old people could claim. People do not claim them, partly because they do not know how to do it. I think that probably applies in this instance because these schemes are complicated for the ordinary person to understand. I hope very much that the Bill will be put before the recipients of this allowance in as simple a way as possible so that they will understand it. I am sure that it is the wish of the Government that it should be so.

I agree with my noble friend Lady Young that a consolidating Bill bringing together all these different allowances and without the very difficult references back to Bills passed many years ago, would be a great help to those people who are eligible and would like to claim these allowances. Ever since the Finer Report was brought out social workers in the country have talked about it. I cannot enumerate how many conferences I have been to where the question of one-parent families has been discussed and reference made to the Finer Committee, yet nothing has been done about it. We on this side did nothing about it, but as the report had only just come out when we were in Office perhaps we can claim that as an excuse. The fact remains that nobody has tackled the one-parent family problem.

There are 66,000 one-parent families, but under the Bill only 15,000 will claim the disregard allowance of £6. That shows what a long way away we are from getting at the root of the problem. I take it that the disregard allowance will be made available to men, as well as to women, if they are bringing up a family because their spouse has died or has run away. Perhaps the noble Lord can reassure us about that point and also give us an assurance that it will be possible for this information to be spread widely throughout the social services departments of the local authorities which administer the different varieties of allowances, so that what this Bill really means, what it stands for and what help it will give will be clearly understood.

I agree with my noble friend Lady Young that so much of the legislation is by reference that it is not very simple to understand. The fact that the Bill says that £6 shall be disregarded is simple. If it can be put in that way so that people understand it, I hope very much that it will lead to many more people being able to claim the allowance. I hope also that many more people will do so. In the meantime, I should like to encourage the noble Lord to consider the question of consolidating the legislation, possibly in the next Session of Parliament. All of us ought also to try to work towards implementing some of the Finer Committee recommendations. Undoubtedly this is a big blot upon the social services of this country which are widespread and in the main very successful. However, like other noble Lords I wish the Bill success.

7.53 p.m.

My Lords, I am very grateful to the noble Baroness, Lady Young, to the noble Lord, Lord Banks, and to the noble Baroness, Lady Elliot of Harwood, for the limited approval that they have given to the Bill. A number of points have arisen in the debate. I do not want to quarrel over figures; it does not matter whether 16,000 or 15,000 lone parents will benefit. What one must bear in mind is that something like 41,000 children will he involved. Although I acknowledge that it is a very limited increase, it is worth while in the sense that at least it will help to keep pace with the present position.

The question of consolidation was raised by the noble Baroness, Lady Young, and the noble Baroness, Lady Elliot of Harwood. I have sympathy with the need for consolidation. I know the problem that professional social workers face. When I present something to your Lordships I try always to get behind the problem and look at the various previous Acts. It is true that from time to time I have considerable difficulty but I have the benefit of a large number of experts to help me. Consequently, it is not quite so difficult for me as it is for other Members of your Lordships' House.

The title of the Ministry of Social Security was changed in the National Insurance Act 1974. This was because the benefit was known as supplementary benefit and the Ministry of Social Security no longer existed. The Government accept that the legislation on supplementary benefit should be consolidated and they hope very much that the Supplementary Benefit Bill 1976 will be passed this Session. As noble Lords will know, this is a complete consolidation.

My Lords, will the noble Lord allow me to say a word about that? It is quite true that the Consolidation Committee has agreed to try to consolidate the present Bill with the preceding legislation which we have already handled, but it would be idle to pretend that the result will be comprehensible to ordinary people. I do not believe that Schedule 1 can be made comprehensible to ordinary social workers, much less to the recipients of supplementary benefit unless there is a substantial rewriting. In other words, pure re-enactment is not enough. What we ought to have had was an amending Bill.

My Lords, I am most grateful to the noble and learned Lord. I wanted to say almost precisely what the noble and learned Lord has said: that this matter is in the hands of the Joint Consolidation Committee and that I believe they will be considering it on Wednesday week. It may well be that once the legislation has been consolidated some guide, as is so often the case, whether it is social legislation or otherwise, will be prepared in order to provide some kind of easy "read" on the whole subject. This has been the position in the past and it may well be necessary again to provide such a guide.

My Lords, I am sorry to interrupt the noble Lord, because he has done his best to answer my question about the title of the Act to which this Bill refers. It might well be that somebody who is engaged in the profession will go to an organisation where he will expect to collect the relevant Act of Parliament and that he will be told that this is the only Act of 1966. Will this be a fault of their record-keeping, or is it a fact that as the Act was not passed in 1966, because the amending legislation came later, one should therefore look for it in a different year?

My Lords, without an example I just cannot answer that question. I am aware of these difficulties but, as the noble Baroness will know only too well, in the field of social work so often it is necessary after a number of Acts have been passed for somebody to reduce them to an understandable form in some kind of booklet. I believe that every professional social worker in this country works on a series of booklets which explain what the various Acts say, what they empower people to do and what the benefits accruing from them are. It may well be that a similar booklet will have to follow the consolidation of the various Acts to which the noble Baroness has referred.

The noble Baroness, Lady Young, and the noble Lord, Lord Banks, referred to the guaranteed maintenance allowance. Perhaps the noble Lord, Lord Banks, answered the question when he said that the Government have rejected this allowance, first, because it would be means tested and, secondly, because it would be expensive in manpower. I am informed that it would require something like 8,000 more civil servants to administer and that the cost would be between £250 million and £400 million a year which, in the light of the present situation, I do not believe any Government could face up to. It does not mean that one ought not to be looking at the whole picture. As Professor Donnison said quite recently, the time has come when we must look very closely and deeply at all the benefits that we are giving to see whether or not something can be done to co-ordinate them.

My Lords, I am most grateful to the Minister for allowing me to put this question to him. I wonder whether he would agree that it would be desirable, if we cannot—and I accept his arguments—have this wider guaranteed maintenance allowance, if we could have instead as a minor step, and something towards alleviating the position, the introduction of the special supplementary benefit allowance recommended by the Finer Committee for one-parent families, which would cost very much less.

My Lords, at this stage I do not think I could possibly commit the Government to taking any specific step in any specific direction. The only thing I can say is that on 15th September the Secretary of State for Social Services announced—as I am sure the noble Lord, Lord Banks, knows—a review of the supplementary benefits scheme. One of the purposes of this review is to see to what extent it is possible to simplify what we recognise has become a very complex scheme. In the course of this review, the team will no doubt take into account the comments that have been made, not only tonight but also the comments that have been made in another place and by other people outside both Houses of Parliament; because obviously a review of the supplementary benefits scheme is necessary and this we have undertaken to do in the foreseeable future.

I do not know whether I can usefully add anything more at this stage. I think I have dealt with most of the questions. The noble Lord, Lord Banks, suggested that the disregard should be larger; as I think I said earlier this evening we considered this, but we felt this was as far as we could go in the present economic climate. There is probably a case to be made out for a much higher disregard, but we must take into account that it is not only a £6 disregard which will take place in the future. At present over and above the present £4 the amount of fares is disregarded. If the lone parent has to pay out money each week for the child to be looked after or attended in some way, that is another disregard. There will be other disregards which in themselves can be quite substantial, particularly where it is necessary for the child to be looked after during the time when the one parent is at work. I think we must take all these things into account, because when they are all added together they form a substantial amount.

I do not know whether I can say more than perhaps noble Lords have read about cohabitation. Any benefit designed to help single parents in particular must, in our view, involve distinguishing those parents who are single. That is the whole purpose of the exercise. The Finer Committee recognised this and was quite explicit about it. If such a distinction were not made, it would not be possible to ensure that the lone parent benefited by the increase in the disregard. I know that a number of Members of your Lordships' House feel very strongly about the question of cohabitation, but I think we must recognise that it is important to the lone parent that two people are not living as man and wife. If they are, the circumstances change completely and the lone parent is no longer a lone parent. I know that this is unacceptable to a number of your Lordships, but I do not see what one could put in its place at the present moment if we want to consider the ultimate benefit of the lone parent.

The only other question I have not answered is that put by the noble Baroness, Lady Elliot of Harwood, who wanted to know whether the disregard applied when the lone parent was a man. The answer is, Yes, treated in precisely the same way. Having said that, I hope noble Lords will feel that I have met the points which were raised and I hope the Bill will now be read a second time.

On Question, Bill read 2a and committed to a Committee of the Whole House.