rose to move, That the Grand Committee do report to the House that it has considered the Pensions Appeal Tribunals (Armed Forces and Reserve Forces Compensation Scheme) (Rights of Appeal) Amendment Regulations 2006.

The noble Lord said: I shall speak to the Pensions Appeal Tribunals (Armed Forces and Reserve Forces Compensation Scheme) (Rights of Appeal) Amendment Regulations 2006 and the Pensions Appeal Tribunals (Additional Rights of Appeal) (Amendment) Regulations 2006. Both these draft regulations were laid before Parliament in accordance with Section 11A(5) of the Pensions Appeal Tribunals Act 1943. The statutory instruments are subject to approval by resolution of both Houses and were considered in another place on 26 June.

I make it clear that they refer to two entirely separate and different schemes. First, I shall address the Pensions Appeal Tribunals (Armed Forces and Reserve Forces Compensation Scheme) (Rights of Appeal) Amendment Regulations 2006. This will provide that there is no right of appeal for decisions to make a temporary award under the Armed Forces Compensation Scheme.

In drawing up appeal rights under the Armed Forces Compensation Scheme, we sought to mirror those under the War Pension Scheme and to simplify them where it was sensible and practical to do so. I believe this aim was fully met in the Pensions Appeal Tribunals (Armed Forces and Reserve Forces Compensation Scheme) (Rights of Appeal) Regulations 2005, which came into force on 6 April 2005.

Regulation 3(1) of the 2005 appeal regulations provides that decisions under the Armed Forces Compensation Scheme, which relate either to entitlement to benefit or to the amount of benefit payable, may be appealed to the Pensions Appeal Tribunal. Regulation 3(1) is subject to the exceptions contained in Regulation 3(2) which provides that decisions to make an interim award or to suspend payment of an award do not carry a right of appeal.

It is now proposed to amend the 2005 appeal regulations. Regulation 3(1) is amended to make it clear that a decision on the making of a permanent award carries a right of appeal. Regulation 3(2) is amended to provide that a decision to make a temporary award does not carry a right of appeal.

I shall explain the circumstances in which a temporary award could be made. The Armed Forces and Reserve Forces (Compensation Scheme) Order 2005 contains a tariff that lists the conditions in which compensation may be awarded and specifies for each a tariff level, which determines the amount of compensation payable.

However, in recognition of the fact that it may, on occasion, prove necessary to award compensation for a condition not listed on the tariff, Article 20 of the 2005 order gives the discretion to make a temporary award for a condition that is not listed on the tariff. Within the period of one year following the making of a temporary award, a decision will be taken on whether the tariff should be amended by adding the condition in question to it. If the tariff is amended, a permanent award is made. If the tariff is not amended, then no permanent award is made. I must stress that this power will be used rarely.

This draft instrument provides that temporary awards do not attract a right of appeal. Such awards are, by definition, temporary and full appeal rights will apply in relation to the decision to make or refuse a permanent award.

I assure the Committee that beneficiaries will not lose out by this. No amount that has been paid to an individual as a temporary award will be recoverable if no permanent award is made or if the permanent award is lower than the temporary award. Full appeal rights will, of course, apply in relation to the decision to make, or not make, a permanent award.

It was not possible to include this provision in the 2005 appeal regulations because the decision to include a discretion to make a temporary award within the Armed Forces Compensation Scheme was made at a relatively late stage and after the 2005 appeal regulations had already been laid.

The main ex-service organisations were briefed last year on the inclusion of temporary awards in the new scheme and of our intention not to extend appeal rights to such decisions. These groups did not dissent. Details of the proposal were also contained in a report to the Central Advisory Committee on War Pensions for its meeting on 7 December 2005.

I should now like to turn to the second draft statutory instrument: the Pensions Appeal Tribunals (Additional Rights of Appeal) (Amendment) Regulations 2006. This will introduce a new right of appeal against a decision under the War Pension Scheme to cancel an award.

The rules of the War Pension Scheme are contained in the Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Order. The Pensions Appeal Tribunals (Additional Rights of Appeal) Regulations 2001 list the decisions under the Service Pensions Order which attract a right of appeal. The 2001 regulations refer to the Service Pensions Order 1983. That order has now been replaced by the consolidated Service Pensions Order 2006. This order has been restructured and renumbered and contains new provisions. One of the new provisions enables the Secretary of State to cancel an award where a pensioner has unreasonably failed to comply with a request to provide information or to attend a medical examination.

Cancellation can occur only if an award has already been suspended for 12 months. I should stress that the powers to suspend or cancel a war pension will be used only as a very last resort after the Veterans Agency and its welfare service have made every effort to obtain the pensioner’s co-operation. The Committee will nevertheless appreciate the need to ensure that awards remain well founded and to hold in reserve a power to suspend or cancel if necessary.

I reassure the Committee that the ex-service organisations with which the department discussed the matter fully agreed with the principle of suspension and cancellation. Those organisations, particularly the Royal British Legion, did however emphasise the need for appropriate rights of appeal. These regulations respond to that concern and amend the 2001 regulations by providing a right to appeal against the cancellation of an award. They also make it clear which decisions carry a right of appeal under the consolidated Service Pensions Order 2006. Copies of each of the draft instruments have been sent to the presidents of the three Pensions Appeal Tribunals jurisdictions, to the major ex-service organisations and the Council on Tribunals.

In conclusion, the first set of proposed regulations will enable the continuing successful implementation of the new Armed Forces Compensation Scheme. It will ensure a streamlined process that prevents the complexities of two appeals possibly arising within months on what is in essence the same issue in the same case. The second set responds to comments by the Royal British Legion that the power to cancel a war pension award should be subject to rights of appeal, and more generally makes it clear what decisions carry a right of appeal following consolidation of the Service Pensions Order. I assure the Committee that we believe that the statutory instruments are fully compliant with the European Convention on Human Rights. I beg to move.

Moved, That the Grand Committee do report to the House that it has considered the Pensions Appeal Tribunals (Armed Forces and Reserve Forces Compensation Scheme) (Rights of Appeal) Amendment Regulations 2006 [29th Report from the Joint Committee].—(Lord Drayson.)

I thank the Minister for explaining the regulations. They are essentially a tidying-up exercise and should have been dealt with at the time of the original legislation. It makes me worry how much secondary legislation we will receive after the Armed Forces Bill becomes an Act. My honourable friend Mark Harper raised our concerns over the compensation tariff for mental health, as opposed to physical injury, in some detail in the other place. I will not raise them again this afternoon but, other than those concerns, the regulations appear not to be controversial and to make perfect sense.

I, too, thank the Minister for a clear exposition on the background to the instruments, which seem perfectly satisfactory. I confess to the noble Lord, Lord Astor of Hever, that if some of my amendments to the Armed Forces Bill are accepted we will have even more statutory instruments to look at.

I am generally content with these two instruments, but I shall raise one issue. In the short debate on26 June in the Standing Committee on Delegated Legislation in the other place, tariffs for mental health injuries were raised by a number of speakers. I declare an interest as a member of Combat Stress, and consulted to see whether it is as happy as it has been reported that various organisations are. I understand that it had a meeting with the Minister for Veterans, Tom Watson, on 21 June. The discussion was on concerns over whether the tariffs in this first statutory instrument are at appropriate levels for mental health injuries when compared with physical injuries. That is obviously not what we are discussing today. However, it would affect the sort of temporary awards put in, which we are dealing with. If the Minister cannot tell us today, perhaps he would write. Is there an intention to revisit the tariffs, with particular reference to whether the mental health injury tariffs are appropriate when compared with the physical injury tariffs?

Nevertheless, this order is about temporary awards, which are time limited to two years. Given that they will then go on to the permanent basis and the normal appeal procedure will happen, we are content to support the Pensions Appeal Tribunals (Armed Forces and Reserve Forces Compensation Scheme) (Rights of Appeal) Amendment Regulations 2006.

The Pensions Appeal Tribunals (Additional Rights of Appeal) (Amendment) Regulations 2006 seems to be a helpful, additional right for people in what one hopes are very rare circumstances. The Royal British Legion has asked for it and the Ministry of Defence has responded, so we will support that as well.

I am grateful to noble Lords for their comments and support. I note what has been said on the Armed Forces Bill and the role of statutory regulations within it.

The noble Lord, Lord Garden, raised the representations that Combat Stress has made to my honourable friend the Under-Secretary of State. We want these tariffs to sensibly reflect the disability that may have been suffered by our veterans, whether physical or mental. I will pass on to my honourable friend the comments the noble Lord has made, to fully reflect that.

On Question, Motion agreed to.