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Lords Chamber

Volume 689: debated on Monday 29 January 2007

House of Lords

Monday, 29 January 2007.

The House met at half-past two: the LORD SPEAKER on the Woolsack.

Prayers—Read by the Lord Bishop of Leicester.

Unemployment: 16 to 24 Year-olds

asked Her Majesty’s Government:

What conclusions they draw from the report of the Office for National Statistics that there are 37,000 more unemployed 16 to 24 year-olds than there were in May 1997, and that 75 per cent more 18 to 24 year-olds have been out of work for over six months compared with five years ago.

My Lords, this month’s fall in youth unemployment is welcome and reverses some of the recent rises in unemployment data. There has been a substantial improvement in youth long-term unemployment on both measures since 1997. This is partly because of the New Deal for Young People, which helps the 18 to 24 year-old group.

My Lords, I thank the Minister for his reply, which is contrary to the Office for National Statistics report. As the number of young men and women categorised at NEETs—that is, neither in education, employment nor training—has risen to a record 1.24 million, does the Minister not think that, rather than give an Answer such as he has given, it would be better if the Government withdrew the unwarranted statement in their 2005 election manifesto that,

“youth unemployment has been virtually eradicated”?

My Lords, I do not recognise that figure either. The NEET population has increased, as have the NEET numbers, but the numbers have increased by less in absolute terms than those relating to the population as a whole. Since May 1997, youth claimant unemployment has fallen by almost a third and six-month-plus youth claimant unemployment has fallen by almost two-thirds. Long-term, 12-months-plus youth claimant unemployment has been virtually eradicated: it is down 88 per cent since May 1997, fully justifying what was in the Labour Party manifesto.

My Lords, there will always be debate about the precise impact on unemployment of any particular policy or about how money can most usefully be spent. But have not the Government been right to ensure that young people who are in the greatest difficulty in the labour market get structured work experience, training and advice? Does not the New Deal take its place in a continuum of policy, starting with Sure Start and stretching through the Government’s drive to improve literacy and numeracy in schools, the Every Child Matters reforms and the 14-to-19 curriculum reforms, which together address the intractable problem of the unemployability of some young people coherently, sensibly and decently?

My Lords, I agree with my noble friend. The New Deal has helped more than 1.65 million people into work, including more than 690,000 young people. The New Deal for Young People data show that the number of individual participants to August 2006 was 1.1 million and that, as of May 2006, individuals going into jobs numbered 693,000, of which 85 per cent have sustained employment. Independent research has found that long-term unemployment would have been twice as high without the New Deal, and the national institute has analysed that the saving to the UK economy of the New Deal for Young People runs at something like £500 million per year.

My Lords, is the Minister aware that the number of available jobs for people without qualifications is rapidly falling? Many of the young people in the NEET group have no qualifications because they have special educational needs which have not been addressed. What are the Government doing for these young people to ensure that their special educational needs are met and they are able to gain some qualifications and obtain a lasting job?

My Lords, the Government agree with the noble Baroness that it is important that people have good qualifications to be able to get into sustainable employment. As the record shows, GCSE attainment has steadily improved since 1997, although there is clearly more to do. Between 1997 and 2005, the Government increased investment in FE by about 48 per cent in real terms, and funding for the participation of full-time-equivalent students increased by 49 per cent in cash terms and 23 per cent in real terms. That is what the Government are doing to address those issues. But there are still some challenging issues, particularly for the 16 and 17 year-old cohort.

My Lords, the Minister puts an interesting gloss on this appalling situation. Does he recall that, last July, in an Answer to a Written Question, we were told that nearly 50 per cent of young jobseekers who had left the New Deal for Young People ended up back on benefits within a year? More importantly, the number of 18 to 24 year-olds who have been unemployed for more than six months stands at 153,000, according to the Office for National Statistics. How does the Minister square that with the Prime Minister’s promise in the “Our Nation’s Future” lecture on 5 September that,

“We have eradicated long-term youth unemployment”?

My Lords, I repeat the figures. On the claimant-count basis for analysing the figures, as at December 2006 there had been a reduction of 87 per cent since 1997 in the number of those unemployed for 12 months or more. That seems very substantial progress in eradicating long-term unemployment among young people.

My Lords, did my noble friend, like me, listen with growing disbelief to the supplementary question posed by the noble Baroness, Lady Miller, and to the contribution from the Front Bench opposite? Will he remind the House what unemployment, particularly youth unemployment, was like during the 1980s when a certain right honourable Member—now a noble Lord—advised people who wanted a job to get on their bikes? Will he also estimate what youth unemployment might be if—heaven forbid, or the electorate forbid—the party opposite were to get into government, cancel the New Deal and implement £21 billion of cuts?

My Lords, I find it impossible to disagree with the thrust of my noble friend’s comments. He is absolutely right that the party opposite opposed the New Deal, although the evidence of the benefit that it has brought is clear. As the record shows, unemployment under the Conservative Government twice hit something like 3 million, and the peak among unemployed young people, in 1993, was something like 1.5 million.

Data Protection: Interception of Communications

asked Her Majesty’s Government:

Further to the Information Commissioner’s report What Price Privacy Now?, whether the individuals who had their communications intercepted have a legal right to be so informed by the relevant news agencies.

My Lords, it is illegal to obtain information through the unauthorised interception of communications. Where organisations process personal data, the Data Protection Act 1998 requires them to act fairly and to notify individuals of the purpose for which data will be used. News organisations may be exempt from this requirement where they are processing data with a view to publication and reasonably believe that publication will be in the public interest.

My Lords, I am grateful for that Answer. Does not the Information Commissioner’s report, combined with the Motorman case last week, indicate that there is still a serious problem in this respect? Is it not true that the many hundreds, if not thousands, of people who have had their privacy invaded, often for no better reason than keyhole peeping, have a right to an apology from those media groups responsible and possibly a legal right of redress? If individuals are worried about coming forward, as many of them will be, perhaps the PCC could take the lead and order those newspapers to make an apology unless there is a continuing and legitimate—and I mean legitimate—public interest defence.

My Lords, noble Lords will know that the Motorman inquiry—a three-year investigation into data protection offences—led to a parallel police investigation. Noble Lords will also know that we are consulting on whether to increase the sanctions under Section 55 of the Data Protection Act and that the Information Commissioner is producing guidance for journalists on the use of data.

My Lords, will the Minister and her colleagues in the Government also approach the chairman of the Press Complaints Commission and the code of practice committee of editors who have refused to give any concrete proposal to the Information Commissioner in response to his suggestion that the code of practice ought to be amended to make it clear that without an individual’s consent, it is not acceptable to obtain information about private life by bribery, impersonation, subterfuge or payment? The inaction of the Press Complaints Commission leaves those of us who would support self-regulation with very little armour left.

My Lords, I have indicated that we are currently consulting. The consultation has just closed, and we will be producing reports on Section 55 of the Data Protection Act and on whether to make it an offence to sell or offer to sell personal data that have been or subsequently are obtained or procured knowingly or recklessly without the consent of the data controller. Within that, the Information Commissioner is looking at a range of different ways in which he can work closely with bodies such as the Press Complaints Commission to ensure that such data are dealt with properly.

My Lords, who owns the information gathered by CCTV cameras? Can the Minister explain who owns that intellectual property?

My Lords, the way in which CCTV cameras are operated means that the information is contained within them. There is not an issue of ownership, as such. Noble Lords will know that there is always a question about the ownership of imagery. It is clear that information can be gathered only for the purposes for which it has been said to be gathered and anyone has the right to complain about the information gathered or the images that the cameras have.

My Lords, will the Minister explain why the Pesticides Safety Directorate has written to its correspondents warning them about intercepted telephone calls? Can she say whether that practice is now common with agencies and government departments?

My Lords, I do not know whether it has written, but I am sure the noble Countess’s information is correct. It is not common practice to do so, but it is right and proper that where there are concerns about information, data controllers feel able to make sure that they notify people about them.

Children: Custody

asked Her Majesty’s Government:

What changes they have made to the treatment of children in custody since the report by Lord Carlile of Berriew into physical restraint, forcible strip-searching and solitary confinement in custodial institutions for children, published in February 2006.

My Lords, the implementation of the code of practice on behaviour management relates directly to many of the noble Lord’s recommendations. The Youth Justice Board has been working with establishments on new definitions and data rules concerning physical interventions. It plans to begin using this new framework from April. The Youth Justice Board and the Prison Service have created a joint programme board to review behaviour management issues, including single separation and full searching.

My Lords, I am grateful to the Minister for that Answer. Does he recall the noble Lord, Lord Carlile, saying in his report that the treatment of these vulnerable children was so bad that it could in any other circumstances result in criminal charges, and that the high level of the use of pain infliction to restrain children was particularly concerning? Does the Minister accept that in the months since the noble Lord’s report came out these restraint methods have continued to be used, more than 5,000 times? How high will that figure have to get before a change of policy will be considered?

My Lords, I recall the noble Lord’s reference. He also commented that he found many examples of good practice in young offender institutions, secure training centres and so on. Sadly, on occasion, because of operational requirements, physical restraint has to be used on young people in secure accommodation. Regrettable though it is, it is for their safety and that of others that occasionally these techniques have to be used.

My Lords, I declare an eponymous interest in this Question. Why, since the Howard League report was produced, has the entirely unnecessary practice of full strip-searching continued to such an extent that at Huntercombe young offender institution, in the most recent statistical period, there have been no fewer than 1,800 enforced strip-searches? It was quite clear to those who advised me when preparing the report that enforced strip-searching should be carried out only in a very small number of cases, if at all, and that the practice carried out at Huntercombe and elsewhere is unnecessary. Why won’t the Government act on this abuse of the bodies of young men and women?

My Lords, I understand the passion with which the noble Lord has put his question. The noble Lord, when preparing his report, recognised fully that strip-searching was necessary from time to time to prevent drugs and weapons being brought into establishments. We realise that there is a great deal of sensitivity on this issue; for that reason, young offender institution and secure training centre rules require that every trainee must be searched on arrival and subsequently only as the governor thinks fit. Of course any search should be conducted in a proper and seemly way, but they must be carried out so as to discover anything that might be concealed. Regrettably, it is necessary to carry out strip-searches; obviously they must be done in the best way possible.

My Lords, the report of the noble Lord, Lord Carlile, recommended that children should not be placed in prison segregation units. Have the Government accepted his recommendation and instructed prisons to stop holding children in segregation units?

My Lords, the use of segregation for young offenders held in secure units is obviously problematic. It is not highly desirable, but from time to time, not least when a young person is acting in a dangerous and violent fashion, it is essential to segregate them, for their own safety and security and that of others.

My Lords, figures released in October 2006 show that more than 3,350 children and young people were held in the secure estate. It is overwhelmingly clear that any improvements to custodial regimes are extremely difficult to effect with such overcrowding. What do the Government propose to do to ensure that custodial sentences are passed only as a last resort, in line with the United Nations convention?

My Lords, custodial sentences are used only as a last resort and when appropriate. Clearly, those judging cases involving young offenders have to consider that carefully. It is regrettable, but some young people commit very serious offences. For those reasons they need to be placed in secure accommodation.

My Lords, in his report the noble Lord, Lord Carlile, recommended that policy responsibility for all children, including those in custody, should rest with the Children’s Minister in the Department for Education and Skills. In the light of the lack of progress since the report was published, the recent resignation of the highly respected chairman of the Youth Justice Board, Professor Rod Morgan, and the rumours about restructuring the Home Office, is such a change now under active consideration? If not, why not?

My Lords, all these things are subject to review and consideration, regardless of whether the future of the Home Office is under examination. It is regrettable that Mr Morgan decided to resign from his post before his contract expired, but these things happen from time to time.

My Lords, the Minister has already said that he did not accept two of the main recommendations in my noble friend’s report, but will he say whether the Government accept any of the five main recommendations or any of the 107 others in the report? Do we have to go on hearing from the Chief Inspector of Prisons not only about the excessive use of force at Huntercombe—and not solely for the purpose of strip-searches—but about the many other defects in the handling of young people, such as the use of handcuffs?

My Lords, many of the recommendations in the report of the noble Lord, Lord Carlile, have been accepted by both the Youth Justice Board and the Prison Service. As I understand it, the noble Lord had a fruitful and useful discussion and meeting with my noble friend Lady Scotland precisely on those parts of the report that were of interest. I think that it would be fair to say that the majority of the recommendations in the noble Lord’s report are either in active commission or under active consideration.

My Lords, will my noble friend comment on the treatment of girls in custody? I understand from a 2006 report by the Chief Inspector of Prisons that girls in some institutions are automatically strip-searched on entry. Will this practice now stop?

My Lords, I am not aware that girls are automatically strip-searched on entry. I will look at that observation and communicate further with the noble Baroness.

My Lords, in light of the recent decision by the European Court of Human Rights in the Wainwright case, the Minister’s replies will be hard to sustain. What consideration have the Government given to how to meet the outcomes of that case, which suggest that a good deal of our treatment of young people is simply not acceptable under human rights legislation?

My Lords, I do not entirely agree with the noble Baroness’s assertion, but clearly that case is important and means that, as at all times, we have to actively consider aspects of our policy with regard to the imprisoning of young people in our offender institutions.

My Lords, I declare an interest as a member of the inquiry of the noble Lord, Lord Carlile. One of our concerns was the use of handcuffs in secure training centres. Does the use of handcuffs still continue and, if so, how many times were they used in 2006?

My Lords, regrettably, handcuffs have to be used from time to time, for the reasons that I have given: some young people become very violent and require to be physically restrained. I do not have statistics on the use of handcuffs in 2006. There probably are some data somewhere in my brief on the use of handcuffs, but I had better set out a full range of data on their use in the past few years so that the noble Lord can be best advised.

Afghanistan: Opium

asked Her Majesty’s Government:

What progress they have made in assisting the Government of Afghanistan to control the cultivation of opium poppies.

My Lords, the United Kingdom is Afghanistan’s partner nation in counter-narcotics and is working with the Afghan Government to bring about a sustainable reduction in poppy cultivation. We are spending £270 million over three years to support the Afghan Government’s national drug control strategy. Last year’s overall increase in opium poppy cultivation was disappointing. In areas of Afghanistan where access to governance, security and development has improved, the reductions achieved last year have been sustained.

My Lords, this is a very difficult problem indeed, not least because access to the poppy fields is usually difficult—over hills or over mountains—so the products have to be relatively small and light. Packets of opium and heroin meet this need and are carried away by humans, not by vehicles—usually over the hills. Would it be worth considering a policy of improving access to the fields, by road or by track, so that a bulkier, non-narcotic product could be grown instead of the poppy?

My Lords, the noble Lord will know that we have been looking at alternative rural livelihoods as part of our strategy. We will continue to do that, but of course this is a long-term strategy. The president of Afghanistan has said that, in his view, it will take at least 10 years, but improving the infrastructure in Afghanistan is clearly a key component of that and, in reconstruction terms, that is partly why our troops are there.

My Lords, does the Lord President agree that we are dealing not only with poppies growing in fields but also eventually with criminality and a large amount of human misery? She will no doubt be aware, as a former Secretary of State for International Development, that Susan George has highlighted the way in which the maldistribution of wealth across the globe contributes to the need of poor countries, and the poor citizens of those poor countries, to earn a livelihood in effect by growing drugs. Does she therefore agree that any strategy for dealing with the drug problem must include a major effort on the international development front along the lines that she has just mentioned, that this must be pursued with a great deal of urgency, and that there is a great need for public education about the link between poverty in the world, the production of illicit drugs, and the criminality and misery that result?

My Lords, of course I agree with the right reverend Prelate about the importance of tackling poverty across the world and the importance of public education. We are dealing with a situation where many farmers feel that the opium poppy is a low-risk crop in a high-risk environment, which is why ensuring security in Afghanistan is so important.

On criminality, I am pleased to be able to tell the House that, in the past year, we have seen the passage of vital counter-narcotics legislation in Afghanistan and the conviction of over 300 traffickers. There was also an increase in drug-related seizures.

My Lords, is my noble friend aware that, in discussions on this, there is a lot of support for the view that income replacement, as the right reverend Prelate said, is very important? But why cannot we buy some of the poppies instead of destroying them? Hearts and mind will go in the direction of the Taliban unless we can sustain the income of people. I think there is support in our own military for this strategy, too. Even though the Treasury might look askance at an open cheque book, ways and means can be found to ensure income replacement and the confidence of the people currently growing the poppies.

My Lords, a number of noble Lords have asked this question, and I specifically asked for some detailed briefing on it. There are currently no central government and law enforcement mechanisms in place in Afghanistan to set up and administer a system of licit cultivation, so traffickers would be free to continue to exploit the illicit market. There is also an issue of pricing, because there is no evidence to show that Afghan opium would be economically competitive in a global marketplace. For example, Australia, France, India, Spain and Turkey currently dominate the export market for licit opiates. I will give noble Lords a sense of the cost. In countries such as India and Turkey, licit production requires market support. In Australia, for example, the production cost for the equivalent of 1 kilogramme of morphine in 1999 was $56. In Afghanistan, it would be $450.

My Lords, how much consideration has the Department for International Development given to industrial hemp as an alternative crop? That plant can be used for industrial building purposes or packaging, its fruit is very nutritious and the hemp oil can be used for all sorts of energy purposes. That would be useful in Afghanistan, as well being a good export product. Will she consider that as an alternative crop to heroin poppies in Afghanistan?

My Lords, I am happy to take that suggestion away. I have had a substantial briefing on this Question, but industrial hemp was not covered.

My Lords, do not the comments made by the noble Baroness, Lady Tonge, and the noble Lord, Lord Lea of Crondall, indicate that the whole policy of eradication that our troops are currently being asked to pursue—a very dangerous policy indeed—is just not working? On the contrary, rather like the Augean stables, the more that we try to eradicate, the more poppies seem to be grown.

Is there not a case for the alternative idea that controlled licensing of poppy growing for pharmaceutical purposes should be developed? We recognise the point made by the noble Baroness about different costs, but surely that is now the line to take, bearing in mind that we should be going after the traffickers even more than at present and that trying to stop small farmers growing poppies to survive and feed their families will be almost impossible?

My Lords, we need an integrated strategy, which is precisely what we have. Poppy eradication policy and implementation is the responsibility of the Afghan Government. The UN Office on Drugs and Crime estimates that 15,300 hectares of opium poppy was eradicated in Afghanistan last year, including about 5,000 hectares in Helmand province, but I entirely agree with the noble Lord that eradication on its own will not solve the problem. That is precisely why we are looking at access to legal livelihoods and at measures to catch the drug barons and bring criminals to justice, to encourage the development of rural communities and to provide alternatives for poppy farmers.

Alcohol Labelling Bill [HL]

My Lords, I beg to introduce a Bill to make provision for the labelling of alcoholic beverages; and for connected purposes. I beg to move that this Bill be now read a first time.

Moved accordingly, and, on Question, Bill read a first time, and ordered to be printed.

Pharmacists and Pharmacy Technicians Order 2007

My Lords, I beg to move the Motion standing in my name on the Order Paper.

Moved, That the draft order laid before the House on 14 December 2006 be approved. 5th Report from the Statutory Instruments Committee and considered in Grand Committee on 24 January.—(Baroness Royall of Blaisdon.)

On Question, Motion agreed to.

Sexual Offences Act 2003 (Amendment of Schedules 3 and 5) Order 2007

My Lords, I beg to move the Motion standing in my name on the Order Paper.

Moved, That the draft order laid before the House on 18 December 2006 be approved. 5th Report from the Statutory Instruments Committee and considered in Grand Committee on 24 January.—(Lord Bassam of Brighton.)

On Question, Motion agreed to.

Corporate Manslaughter and Corporate Homicide Bill

My Lords, I beg to move the Motion standing in the name of my noble friend Lady Scotland of Asthal.

Moved, That the amendments for the Report stage be marshalled and considered in the following order:

Clause 1,

Schedule 1,

Clauses 2 to 20,

Schedule 2,

Clauses 21 to 23.—(Lord Bassam of Brighton.)

On Question, Motion agreed to.

Concessionary Bus Travel Bill [HL]

Report received.

Clause 1 [The national concession]:

1: Clause 1 , page 1, line 13, leave out “bus” and insert “public service vehicle”

The noble Lord said: I shall also speak to Amendments Nos. 15, 18, 21 to 24, 27 and 28. These are minor technical amendments intended to clarify or improve the drafting of the Bill, together with a concessionary amendment addressing a point raised by the Delegated Powers and Regulatory Reform Committee in its report on the Bill.

Amendments Nos. 1 and 18 are needed because, in two places in the Bill, we have used the word “bus” when we should have used, for consistency with the Acts being amended—the Transport Act 2000 and the Greater London Authority Act 1999—the technical expression “public service vehicle”. Those amendments, however, change neither the definitions of “public service vehicle” or “eligible service” nor the substance of the definition of “eligible journey”.

We tabled Amendment No. 15 to put beyond doubt the fact that more generous concessions can be provided within London, should the boroughs and TfL agree them. Currently the wording of the change to the Greater London Authority Act 1999 made by Clause 6(2)(b) might be read as preventing more generous concessions being granted to London residents than the concession specified in Clause 6(4). That has never been our intention. Londoners already get concessions that are in some respects more generous. Amendment No. 15 ensures that there is no doubt about that. It is not in any way a policy change.

Amendments Nos. 21 and 22 are needed because Clause 7(2)(b) replaces the words,

“issued to him in accordance with the arrangements”,

in Section 243(1)(b) of the 1999 Act with some new words, which do not include any equivalent of the words “to him”. These amendments therefore insert the words “to the person” to rectify that error. Again, there are no policy implications.

Amendment No. 23 changes the word “document” to “permit” in the definition of “travel concession permit” in Section 243(5) of the 1999 Act. This is to avoid any argument that smart cards or perhaps certain types of smart card do not readily fall within the description “document”. Although the meaning of “document” may be thought to have the flavour of a piece of paper or something similar with writing on it, “permit” does not have the same connotation and is consistent with the rest of the legislation.

Amendments Nos. 27 and 28 merely add a signpost to Section 162 of the Transport Act 2000, the general interpretation section for Part 2 of that Act, to the new definition of “London Authority” inserted by Clause 2(2). That definition already applies for the purpose of Part 2 of the Act so there is no change of any substance. The inclusion of a signpost in Section 162 is consistent with the general approach taken in that provision.

We have given careful consideration to the report of the Delegated Powers and Regulatory Reform Committee on the Bill, and I am grateful to it for its work. Amendment No. 24 addresses a point raised at paragraph 13 of the report. The committee commented on Clause 9(3)(g), regarding the regulation-making powers of the Secretary of State should he make an order to take over responsibility for the reimbursement of bus operators. We had an interesting debate in Grand Committee about the wider purpose of Clause 9, and I see no reason for this amendment to reignite that debate. Instead, its purpose is simply to improve the clarity of the Bill as it sets out the specific powers provided by Clause 9(3). The amendment now limits, via proposed new paragraph (f) in Clause 9(3), the scope of the regulation-making powers that an order made under Clause 9(1)(a) can confer on the Secretary of State. It also requires at proposed new subsection (3A) any such regulations to be subject to the negative resolution procedure. This maintains the existing procedure for regulations relating to reimbursement and appeals matters as set out in the Transport Act 2000.

New Clause 9(3)(f) enables regulation-making powers to be conferred on the Secretary of State that correspond with or are similar to the Secretary of State’s existing regulation-making powers in Sections 149(3), 150(6) and 156(7) of the 2000 Act. It also includes a sweep-up provision to cater for other ancillary matters for which regulations might be needed, for example for how to claim a reimbursement. As the scope of the regulation-making power is now more specific, we have also sought to be more specific about the kind of amendments to the 2000 Act that an order under Clause 9(1)(a) might make by virtue of Clause 9(3). In particular, we hope that the wording of the proposed new Clause 9(3)(b), by referring to “altering” current provisions about appeals, will reassure the House that there will be an appeal mechanism, should the power to centralise reimbursement ever be used. I hope, therefore, that Amendment No. 24 reassures the House of our intentions.

In drafting these amendments, our intention is to make the Bill more accurate and explicit, and I hope it will be recognised that we have achieved that goal. Accordingly, I beg to move.

My Lords, I have no problems with the amendments. From what the Minister has said, I understand that they will make the Bill clearer. However, I want to be absolutely certain that no change will be made to the provision in London and that that system will carry on as it is now.

2: Clause 1 , page 1, line 13, after “bus” insert “, underground, tramway or ferries”

The noble Lord said: My Lords, we turn, once again, to the idea of extending the concessionary scheme to modes of transport other than buses. We discussed that principle at some length in Committee; therefore, I shall keep my remarks as concise as possible today.

Every noble Lord, including the Minister, who spoke on this issue in Committee supported in principle such an extension of the scheme. There is no dispute that many people would benefit greatly from the application of the concessionary scheme to a wider range of transport modes; it would give even greater flexibility and freedom to many citizens. The problem, of course, is its financing. The Minister made the point in Committee that one has to be realistic about the funding of such projects, and I have a fair degree of sympathy with his comments.

I asked for a breakdown of the estimated cost of extending the scheme, and the Minister was kind enough to write to me with the relevant information. As he mentioned in Committee, by far the largest cost would be the inclusion of travel by train, which would cost some £250 million each year. Although we all hope that one day we will be able to offer such a service to senior citizens, its financing clearly needs careful thought. In tabling the amendment, we have taken on board the associated costs and tried to make the proposal slightly more palatable to the Minister and the Treasury by seeking to extend the scheme only to trams, the Underground and ferries.

This arrangement would bring the concessionary scheme in England into line with similar schemes already in operation in Scotland and Wales. The powers of devolved institutions and the provision of services within each of those nations, and in turn within England, is an entirely different debate. I will not go into that today, except to say that it would seem sensible and right to extend the scheme in England to those transport modes already covered in the rest of the UK. That would give greater clarity and understanding to all those involved.

Amendments Nos. 16 and 17 would allow travel on buses at any time, inside and outside London, and would cover all modes of transport which exist to meet the transport needs of Londoners. We all know that the Tube is just as important as buses in meeting the transport needs of the capital. Rail and light-railway services also play an important part and will increasingly do so. I beg to move.

My Lords, Amendment No. 3 is grouped with Amendment No. 2. I recognise that the Government will be extremely hard pressed to extend free travel by other means at the moment. I further recognise that there is a serious funding problem, about which my noble friend Lady Scott of Needham Market will speak when we come to the appropriate amendment.

Amendment No. 3 does not seek immediately to extend the facility to anyone. It allows the Secretary of State, through regulations, to make provision for an eligible journey to be extended on to another mode where he considers it appropriate to do so. I raised in Grand Committee the question of the Croydon Tramlink, which for part of its journey—from New Addington to Croydon—is a substitute for a bus service that was withdrawn. People in those circumstances may have a legitimate complaint, which the Secretary of State may wish to alleviate. Similarly, if we go to Merseyside, a ferry journey from Birkenhead to Liverpool is part of the journey in many cases.

I seek merely to draw the Minister’s attention to this amendment, which simply makes the facility available to the Secretary of State and would not necessitate further amendment to primary legislation in this House.

My Lords, I am grateful to both noble Lords for their contribution to this short debate. I recognise that we all benefited from the debate in Committee, which helped to frame these amendments in somewhat different terms from the originals. We are, however, covering old ground; the Bill is about extending the geographical scope of the statutory minimum concession to guarantee that older and eligible disabled people can access important services outside their local authority by bus for free. The Bill is not about extending the concession to other forms of public transport, such as trains, trams, the Underground and ferries.

I recognise that noble Lords are not pressing the Government quite as far as in Committee, but, as I pointed out then, local authorities have the discretion to offer travel concessions on other forms of public transport, and the Bill preserves that flexibility.

As I also said in Committee, the Government have no plans to extend the statutory minimum concession to other forms of transport. There would be costs involved, and any extension would have to be fully funded, as the noble Lord, Lord Hanningfield, recognised. Estimating just how much it might cost to extend the concession to other modes is difficult, and we have not done that work yet, but clearly we are talking about significant sums. As the noble Lord has heard, we reckon that extending the scheme to rail would cost about £250 million a year. It might cost about £15 million to extend the scheme to trams.

The Government have already committed to spending £1 billion on concessionary travel to improve the mobility and well-being of older and disabled people. Until we have worked that through and got the system in place, it would be injudicious to seek to extend the forms of eligible travel. Older and disabled people already qualify for one-third off most rail journeys, as the Department for Transport requires train operators to participate in the senior and disabled person railcard schemes. This is an extensive and important step forward in providing concessionary fares. It will cost a substantial amount of money. The Government are not unsympathetic to the noble Lords in pressing for extra consideration; however, the scheme has to be fully costed.

If the Secretary of State wanted to extend the national concession to other modes of public transport, he has the ability, under Part 2 of the Transport Act, to do so. At this stage, though, we are merely considering whether the resources are available for the extension, and it is only right that, until we have worked through this particular concession, we should postpone consideration of other modes of travel. The Bill will not inhibit that consideration when it is eventually passed.

My Lords, I thank the Minister for that reply. It is not unexpected, given our debate in Committee. We all support the Bill in principle, and it will probably evolve as time goes on. With a small amount of money, some categories covered by the legislation could be improved. I know that money is never available, but it might have been wise to have added a few more millions to this and taken them off something else—easier to say than do, I know—to make this scheme acceptable to everyone. However, I heard what the Minister said, and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 3 not moved.]

4: Clause 1 , page 2, line 11, at end insert—

“( ) For the purposes of this section, a disabled person is a person who—

(a) is blind or partially sighted, (b) is profoundly or severely deaf, (c) is without speech, (d) has a disability, or has suffered an injury, which has a substantial and long-term adverse effect on his ability to walk, (e) does not have arms or has long-term loss of the use of both arms, (f) has a learning disability, that is, a state of arrested or incomplete development of mind which includes significant impairment of intelligence and social functioning, (g) would be defined as having a mental impairment which has a substantial and long-term adverse effect on his ability to carry out day-to-day activities in accordance with section 1 of the Disability Discrimination Act 1995 as amended, or (h) would, if he applied for the grant of a licence to drive a motor vehicle under Part III of the Road Traffic Act 1988, have his application refused pursuant to section 92 of that Act otherwise than on the ground of persistent misuse of drugs or alcohol.”

The noble Lord said: My Lords, Amendment No. 4 would modify and place in the Bill the definition of a disabled person in the Transport Act 2000 which determines eligibility for concessionary bus travel to ensure that those with mental health problems who would have difficulty accessing public transport are covered in the Bill and not elsewhere in legislation—that is, under the Road Traffic Act 1988. If the amendment is agreed to, a comparable amendment would need to be made to the Bill in relation to London.

I welcome the assurances given by the Bill team that the definitions of disabled people for the purposes of concessionary travel in Section 146 of the Transport Act 2000 and Section 240(5) of the Greater London Authority Act 1999 will be unchanged by the Bill. However, coverage of people with mental health difficulties remains a problem. I am reintroducing the amendment to ensure that people with mental health problems are explicitly covered in the Bill.

Eligibility for concessionary fares can do much to aid an individual’s chance of recovery and reintegration into society. Severe mental ill health often leads to social and physical isolation, discrimination and an inability to play a full part in economic and community life. Access to community centres, drop-in therapeutic communities, counselling or self-help groups can greatly aid recovery, but many service users rely on public transport. Even where they still hold a driving licence, poverty and a fluctuating health condition may make driving impossible. The ability to travel to education centres to take up job opportunities and access community health and social care facilities is vital. Inability to access these can lead to serious consequences for the individual.

Currently, most of those with mental health problems who qualify for concessionary fares do so by virtue of the fact that they would, if they applied, be refused a driving licence under Part 3 of the Road Traffic Act 1988, pursuant to Section 92. That section refers to five categories of people who would be refused a driving licence, the second of which refers to people with a severe mental disorder. It is under this provision that people with mental health problems may become entitled to concessionary fares.

I believe that it would conduce to clarity to insert that provision in the Bill. The Minister rejected that suggestion in Committee, but I think he may have been under the misapprehension that it was intended to extend the scope of the legislation. That was not the intention. In moving her amendment in Committee, the noble Baroness, Lady Hanham, merely wished to consolidate diverse existing provisions in one place. It would be helpful to have this consolidating amendment in the Bill.

By importing paragraph (h) into this Bill from the Road Traffic Act 1988, we do not intend to extend the scope of concessionary travel legislation. Since the debate in Grand Committee, the Minister has supplied information estimating the cost of extending concessionary travel to carers at £9 million. It is possible, due to uncertainties surrounding the precise scope and impact of particular definitions in legislation, that there might be a marginal extension of coverage, but it is my contention that it would be entirely marginal. The Minister’s estimate of the cost of extending the provision to carers is less than £10 million, which—although it is a substantial sum to you and me, in terms of the Government’s expenditure on concessionary travel, is a drop in the ocean. I would have thought that the Minister might be able to take it on the chin.

However, if the amendment in this form is not acceptable to the Minister, I can think of other ways in which to achieve a similar effect, so perhaps it might be possible to have discussions before Third Reading to find a mutually agreed way forward. Alternatively, we can continue the discussion at Third Reading itself, but it would be in every way more profitable if we could have discussions outside the Chamber before we got to that stage. I beg to move.

My Lords, my name is also on this amendment. I particularly wanted to speak about the definition and, as the noble Lord, Lord Low, said, the clarity in that regard. My noble friend Lady Hanham, who cannot be here today, was concerned about the wording in the Bill and the fact that mental disabilities might not seem to be covered. We do not want to increase the scope of the Bill, as some amendments to this part of the Bill would do; we simply want to achieve a clearer definition. I hope that the Minister might be able to give us something on that and improve the wording.

On carers, I hope that the Minister will take up the suggestion made by the noble Lord, Lord Low, on how we might cover some of those people even without any extra costs. I look forward to the Minister’s reply with interest.

My Lords, I am grateful to both noble Lords, particularly to the noble Lord, Lord Low, for moving the amendment. I have considerable sympathy with his case. Although I cannot accept this amendment as it stands, we have an intervening period before Third Reading and I am only too willing to meet him and see whether we can get a meeting of minds on how to tackle the problem that is rather more to his advantage than he may see in my straightforward rejection of his amendment. I shall identify some of the difficulties that we have to overcome, some of which I identified in Committee.

The noble Lord said that he thought that Amendment No. 4 was an exercise in consolidation, but we will have to beg to differ on that. To the department, paragraph (g) looks like more than consolidation; it looks like the introduction into the Bill of an extra and quite significant concept. I hear what he says about aspects of the marginal costs involved. We will have to discuss those costs more extensively. I am not sure that they are quite as marginal as he suggests.

However, the amendment breaks new ground. If it were carried, the implications for this legislation and the Government would be considerable. We accept exactly what the noble Lord says as a main principle—that access to transport has an important part to play in reducing social exclusion. This is why we are extending the geographical scope of the statutory minimum concession to guarantee that older people and the groups of disabled people provided for in the Transport Act 2000 and the Greater London Authority Act 1999 can access important services outside their local boundary by bus for free. That is where the costs of this legislation obtain.

The Bill is not about extending the concession to other groups of people by changing current definitions. If we want to change those definitions, we can do so by order under the Transport Act 2000 powers. If local authorities want to do so, they have a discretion under the Transport Act 1985 to offer travel concessions to groups other than those specified in present legislation. However, as I stated in Committee, we are not yet in a position to commit further funding to concessionary travel. The Bill and existing provisions will cost £1 billion per year in statutory concessionary travel to improve the mobility of older and disabled people. That is a very substantial spending commitment. I am sure that the noble Lord, Lord Low, will in all fairness recognise the progress which has been made in extending this provision to the most vulnerable in our society.

Estimating how much it might cost to extend the concession to people with a mental impairment is very difficult as it depends very much on the exact definition. When one is aware of the extensiveness of diagnosable mental health problems in our population, one recognises that a very large number of people might be covered by the provision. We are talking about significant numbers. Our initial estimate is that it might cost as much as £50 million a year, but we cannot be definitive about that figure. It could be more. It is not just a question of resources. Practical and administrative issues would have to be considered and resolved before we made such an extension. We would need to set up a robust and fair system for assessing eligibility against the definition of mental impairment. That is no straightforward matter.

It is also important that all those with an interest and expertise in the area are consulted before we legislate in those terms. Changing the definition of disabled person in the Bill, which is what the amendment would do, is somewhat premature because we have not been involved in such consultations, as that was not part of our intent with this legislation. We must focus on the task in hand—the delivery of the new national bus concession. A lot of work has been done to deliver this major improvement, which will benefit many disabled people without having to implement a further change on which they have not been consulted.

I recognise the strength of the advocacy of the noble Lord, Lord Low. I reiterate that I am prepared to meet before Third Reading with him, the noble Lord, Lord Hanningfield, if he would like to be involved, and any other noble Lords interested in the matter. However, I hasten to add that Third Reading is not that far away. I am certainly prepared to discuss the matter further, but I should like the noble Lord to reflect on what I have said today and what we said in Committee and recognise that there are real difficulties for the Government in accepting an amendment of this kind. I hope that he will reflect on the matter and withdraw the amendment today. Perhaps we can advance the matter further in discussion when this stage is completed.

My Lords, I thank the Minister for his full and careful reply. He replied in considerable detail. As he suggested, I will read carefully what he said and reflect on it. However, I am grateful to him for being flexible and forthcoming, and for indicating that he would be willing to have further discussions about the amendment, whatever his reservations about it. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

5: Clause 1 , page 2, line 11, at end insert—

“(4A) If a disabled person requires the assistance of a companion to travel on journeys on public transport services, the travel concession authority in England outside London must mark that clearly on the permit.

(4B) Where a person whose current statutory travel concession permit is marked in accordance with subsection (4A) is entitled under this section to a waiver of the fare for a journey, one companion travelling on the journey with the person (and nominated by the person as the person’s companion for that journey) is also entitled to a waiver of the fare for the journey.

(4C) The Secretary of State shall issue guidance to travel concession authorities in England to which they must have regard in determining for subsection (4B) whether a disabled person needs a companion in order to travel.

(4D) Before issuing guidance under subsection (4C), the Secretary of State shall consult—

(a) the Disabled Persons Transport Advisory Committee; (b) associations representative of travel concession authorities; and (c) such other persons as the Secretary of State thinks fit.”

The noble Lord said: My Lords, the amendment would require travel concession authorities outside London to issue permits for free travel for companions who travel with a disabled person who needs a companion because of their impairment. Amendment No. 19 would introduce a similar provision for London.

Not all disabled people are able to access mainstream public transport on their own. Concessions should be available to allow a companion to travel free of charge where this is necessary to enable a disabled person to access public transport. The amendment is designed to enable the principal purposes of the Bill—namely, to extend concessionary travel to disabled people—to work effectively. If disabled people cannot access public transport on their own and need a companion to enable them to do so—for example, to get on a bus—it is clearly not possible for them to avail themselves of the concession for which the Bill legislates unless they have the services of a companion. If taking a companion with them is not to increase the cost of the journey, it follows as night follows day that it is necessary for the companion to be able to travel free of charge.

Perhaps my remarks about the Minister’s information regarding the cost of extending the concession to carers would be of even more relevance to this amendment. As I argued on the previous amendment, the Minister’s costings appeared to be marginal to the total expenditure under the Bill. Most of the companions to whom the amendment relates would fall into the category of carers. I am therefore proposing simply a marginal amendment to the Bill.

A concession of this kind, for companions to travel free of charge, is already provided for under the Welsh scheme. There is no good reason why the English scheme should be inferior. It is invidious that distinctions of this kind should operate in different parts of the United Kingdom.

It is not only people with physical or sensory disabilities who are affected in this way; there are particular issues also for people with phobias or who experience high levels of anxiety or disorientation in busy or unfamiliar places. Those people, too, may need someone with them for support.

Concessions should therefore be available to allow a companion to travel free of charge where this is necessary to enable a disabled person to access mainstream public transport. As I said, this extension is already provided for under the Welsh scheme. The amendment is based on similar legislation which already exists in Wales. I ask that the provision be imported into the English scheme as well. I beg to move.

My Lords, again, I support the noble Lord, Lord Low, on his amendment. The Minister has said several times today that we are asking him to spend £1 billion a year on this scheme. It seems that we could rejig this provision to cover the most vulnerable and deserving of discretionary free transport.

The Minister said several times that local authorities have that discretion. We will talk about the funding of local authorities in a little while. I suspect that if we have the funding of local authorities right they might want to provide some discretionary transport, but we shall talk about that later. There might be some room at the edges to facilitate this amendment which, I repeat, would help the most vulnerable and needy.

My Lords, I am grateful to both noble Lords. I do not have a great deal to add to my reservations on the previous amendment. The Bill is about expanding the geographical scope of concessionary travel, not adding new eligible groups, although I recognise the force of the presentation of the noble Lord, Lord Low.

The noble Lord is right that this is a more marginal cost than the previous amendment, but our estimate amounted to about £10 million a year for carers. The term “companion” could of course be interpreted very widely, and our estimate of £10 million was in the context of a rather narrower concept of carer than that, heightening the importance of getting definitions right. We would also have to be fair about applications, with a robust system for assessing whether a disabled person required the assistance of a companion to travel on public transport services—otherwise, it could be wide open to extravagant claims. Who would qualify as an accompanying carer—a nominated person as specified on their pass, or a considerate and helpful fellow passenger? We would have to answer a lot of questions before we had a robust scheme in place. The noble Lord says that it will not cost too much. These matters never cost a great deal, although millions are millions.

The noble Lord will recognise that it is unfair to say that Wales already has this. One of the sublime beauties of devolution is that countries will move at a different pace. If we say that devolution develops a fast engine at the front and everybody just hooks their wagon to it, that would reduce a great deal of our decision-making; we would just be following what has been done elsewhere, sometimes at quite considerable cost. I will not have that, particularly as local authorities have the power to be more extensive in their definitions. If they choose to do so, it would not then be fair to say that the whole nation must automatically follow suit. We have circumscribed these matters with relative powers by legislation.

The noble Lord, Lord Low, will therefore recognise that the Bill generates substantial costs in extending concessionary travel across England. England is bound to be much more expensive than Wales because of its population and area. By the same token, it is much more expensive to do this in Scotland. There are large costs involved in this Bill, and there are therefore bound to be reservations about extending categories when the Bill is largely concerned with extending the concession to England.

I hear what the noble Lord has said. I am certainly prepared to discuss this matter with him further—I cannot imagine that I would talk with him about the previous issue without him putting the case for this matter at some stage. I shall be prepared for that eventuality, and we shall see how those discussions work out. As it stands, however, I have some difficulty with the amendment, and hope that the noble Lord will at least withdraw it for today.

My Lords, in view of the Minister’s clear and careful presentation of the Government’s views on the amendment, I am prepared to withdraw it for today. As he said, there will be an opportunity at Third Reading, however soon it comes, for us to debate the scope of the amendment and whether there might be some way of accommodating it, at least in part. I am grateful to the Minister for his offer in that regard and I would be happy to have discussions with him before pressing the amendment, which I am happy to withdraw today. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6: Clause 1 , page 2, line 11, at end insert—

“(4A) If a disabled person is unable to access mainstream public transport as a result of their impairment, the travel concession authority in England shall mark that clearly on the permit.

(4B) Where a person whose current statutory travel concession permit is marked in accordance with subsection (4A), he shall be entitled to a waiver of the fare for a journey when using a community transport service.

(4C) The Secretary of State shall issue guidance to travel concession authorities in England to which they shall have regard in determining for subsection (4B) whether a disabled person needs the use of community transport.

(4D) Before issuing guidance under subsection (4C), the Secretary of State shall consult—

(a) the Disabled Persons Transport Advisory Committee; (b) associations representative of travel concession authorities; and (c) such other persons as the Secretary of State thinks fit.”

The noble Lord said: My Lords, in moving the amendment and in speaking to Amendment No. 7, I acknowledge immediately that there are financial implications to them, as there seems to be in everything that we have discussed today. However, in this amendment a wider point is to be made—and I would like to hear the Government’s views on it—about the acceptance of the principle that efforts should be made to assist people who are not able to use public transport and are, therefore, denied access to a reasonable life and a reasonable existence.

That is particularly the case for people living in rural areas. It is currently estimated that 27 per cent of people over 65 who live in rural areas have no access to a car. We also know that the proportion of older people is growing fastest in rural areas. The Minister, in reply to that point in Committee, effectively stated that his hands were bound, due to costs of implementing such a scheme. That is why we have looked at this matter again. I have dropped from the amendment any mention of taxis or door-to-door services. The benefit of that is that local authorities and other providers could tailor existing services to meet the needs of those that need them most and, in turn, benefit from inclusion in the national scheme.

To give noble Lords some idea, the existing community transport sector is vast and growing. Over 100,000 minibuses, serving over 10 million passengers every year, are operated for use by voluntary and community groups, schools, colleges and local authorities or to provide door-to-door transport for people who are unable to use other public transport. Door-to-door transport is not limited to minibuses; there are many voluntary car schemes throughout the UK in which volunteers use their own cars to provide transport for individuals. Therefore, a ready-made network is already in place that would benefit countless millions.

In a helpful letter, the Minister stated that extending the concession to community transport would equate to some £25 million a year. However, we have seriously to ask whether we should not look on such a scheme as a price to pay for bringing huge benefits to some of the most vulnerable in our society. I declare an interest as leader of Essex County Council, because community transport is an area of major growth there sometimes replacing existing bus services because that might be a more worthwhile and cheaper form of transport. That philosophy will grow considerably over the next few years.

I suspect that the Minister will again be unable to support the amendment, but I hope that he might give an undertaking that the Government will look again at the whole issue of people without bus services in their areas or who, for various reasons, are unable to use buses. I beg to move.

My Lords, I have some reservations about the amendment. It is a fact that many ordinary bus services which are used by a lot of people are being withdrawn because there is not enough money to pay for them. In my appreciation, in many cases community transport and the like is only provided in the first place because the local authority has committed a good deal of money to subvent it. For people then not to pay any sort of fare may be gilding the lily a little—you are letting them off a little bit but you have already contributed a great deal in putting the service in place.

Only this morning, I was told by a bus operator at home, who operates a service along a main road between Witney, Abingdon and Wallingford, conveying several hundred people a day, that the funding for it is to come to an end in June because there is no money to support it. It is somewhat contradictory to argue that there is a need for extra funding for a part of the network to which much funding is already directed while core bus services are being taken out because there is not enough money to pay for them.

I return to what I said at the beginning: the Bill is more about funding and, more particularly, about how that funding is directed to the places that need it—we know that some of it is being misdirected—and rather less about the small amount of money that people are paying for community transport. I am all for community transport but let us not forget that we are seeking to protect the mainstream bus services.

My Lords, I am grateful to the noble Lord, Lord Bradshaw, for reminding the House of a homely truth: you cannot spend the same money twice, and that which goes in one direction may be at the cost of another service which may be more valued.

Of course, I recognise, as I am sure do the noble Lord, Lord Bradshaw, and all noble Lords, the value of community transport services—they clearly meet areas of real need—but, like the noble Lord, Lord Bradshaw, I do not think that these amendments represent the best way forward at this stage. Providing free travel on community transport for those who cannot access mainstream bus services, as suggested by the amendment, would throw up a lot of difficult and complex practical issues. How would the ability to access be defined and assessed, and who would carry out the assessment? What would the arrangements be for appealing against such determinations?

The trouble is that the amendments do not even tell us what community transport is. It is a fairly general term widely in use in our communities but it has different interpretations and covers different people. To introduce, as the amendment would do, a full waiver of the fare for a somewhat ill defined large number of people would represent a seismic shift in community transport in this country. It is not on the margins; it would represent a significant change.

Do we know whether the community transport sector could meet the extra demand generated from such a significant change? What about the extra administrative burdens that would be placed on the sector? After all, we are not talking about government implementation here; this is a voluntary sector serving the community and it might find that very heavy burdens are placed on it—a point emphasised by the noble Lord, Lord Bradshaw. What would be the impact on existing rural bus services, and might it not damage services which are important but are operating very much on the margin of profitability and effectiveness?

I recognise that community transport as a concept is welcomed and admired in our society; nevertheless, introducing into the Bill free access to community transport would throw up a range of very difficult problems. We need to spend £1 billion, and we intend to do so, on this geographical extension of free bus travel. This amendment would add a complicating factor whose cost we would have difficulty in assessing and whose implications may not be wholly benign.

My Lords, the debate has shown that the noble Lord, Lord Bradshaw, is not the leader of a council but a member of one, whereas I have to grapple with the problems of community and other transport in a very large county. I do not like to go over all the problems I have on Essex County Council, but it spends £75 million a year on transport of one kind or another. We have a sophisticated process dealing with school children, special educational needs, the elderly, rural areas, buses—you name it. We are trying to get the best value out of that £75 million and therefore we are conducting a sophisticated analysis of how we can serve the county better and, we hope, spend less than £75 million a year.

Sometimes there are no rural bus services and there are not likely to be, even in a county such as Essex. Therefore, community transport is the saviour of that area. Sometimes we want to ensure that children, the elderly and people who want to get to hospitals are served by the same transport, and community transport is involved in that. Therefore, using community transport effectively is the way forward for many multi-users of transport. I am disappointed that neither the noble Lord, Lord Bradshaw, nor the Minister has understood what we are talking about.

I will withdraw the amendment today but I will table a further amendment for next week so that people understand what local authorities are grappling with in trying to find transport for the masses they are trying to serve. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

7: Clause 1 , page 2, line 17, at end insert “, or

(c) that is compliant with the ITSO standard, as detailed under Crown copyright in 2004.”

The noble Lord said: My Lords, as the Bill stands, there is ambiguity about the specification of the proposed national smart card. We debated this at length in Committee and there was general agreement. The issue is how it will happen. The Bill does not specify the format that the smart card should take. That would not be a problem were it not for the fact that there is a national standard in smart-card technology, known as the ITSO standard. Detailed specifications of that were published in 2004 under the Crown copyright.

In my view, the lack of rigid specification on this matter theoretically allows the Government to deviate from the ITSO standard, which would be a senseless waste of the significant work already completed in introducing the scheme. I know that the Minister supports the implementation of smart cards of this specification and the Government have been working to develop the scheme. Formalising this intention is important in order to provide clarity to local authorities whose duty it will be to deliver the scheme on the ground. It is important that the scheme is not nationalised and that it is operated by local authorities. However, there must be some consistency in a national scheme and I believe that that is possible.

Furthermore, the Minister indicated that local authorities already have, and will continue to have, a significant input into the development of the scheme. The Minister indicated that in his letter to us a week or so ago. I applaud the recognition that local authorities have the capacity to deliver on this initiative and would like to see the amendment pressed so as to guarantee that the work continues. I beg to move.

My Lords, this is one of the two important issues in the Bill. In Grand Committee, the Minister said that the Government are sympathetic to the introduction of smart cards. However, I reiterate that not only are they a method by which people can buy their tickets, but, more importantly, they would be a measure of bus use. Admittedly, in this case that would relate to smart card holders only, but it is a considerable advance on what we have now and a much better way of distributing the £1 billion to which the Minister referred and the substantial sums that are paid to operators in bus-service-operator grant. That grant is paid for the mileage run rather than the passengers carried, which is the output that we are seeking to cover.

There is a tremendous risk that without the introduction of an agreed standard, individual local authorities might begin to develop smart cards themselves. Although they could be extremely successful within their areas, they may not be compatible with schemes introduced elsewhere. In the area where I come from, I am aware that the Oxford Bus Company is launching a smart card. I have no idea whether it is ITSO-compliant, but it is important that such schemes are. I point out to the Minister that while it is possible to extend the range of the cards used in London until 2010, it will then be necessary to reissue them. It would be helpful if by 2010 there was a national standard to which London, a big part of the English market, could contribute. If we have a multiplicity of small schemes, not only will the bus companies and local authorities spend more money introducing them, but the schemes will have to be amended later on.

We want to see momentum stepped up to get a fully fledged national scheme based on smart cards. There may be some problems; I am aware that there is a need for up-front investment by operators to have machines which read smart cards on buses and to have the back-office facilities to take the information off the machines and use it. I would like to hear what the Government are going to do about smart cards because it is tempting to table an amendment at Third Reading setting a timescale for an ITSO-compliant smart card. Perhaps the Minister has some good news for us and will tell us that we need not bother because he has information that will cheer us on our way.

My Lords, nothing would please me more than to bring cheering news to the noble Lord, Lord Bradshaw, and, indeed, to the House about smart cards. I shall in one respect because we entirely support the motivation and aims of this amendment, which is seeking to ensure the faster and wider spread of smart ticketing, an issue we discussed extensively in Committee. I hope that I indicated that the Government are committed to that objective. Where we differ is that we do not think we need an amendment to the Bill.

The department has already done a great deal to promote the use of smart ticketing. It sponsored the ITSO standard and is already working with local authorities in various parts of the country to develop projects using it. We are supporting the migration of three legacy schemes, introduced before the development of ITSO, so that they comply with it. Cheshire, Nottinghamshire and Southampton’s migration schemes are expected to be completed in the next 12 months, and they will join the ITSO standard. We are also working with other local authorities developing ITSO pilot schemes in their areas. For example, the NoWcard scheme in Cumbria and Lancashire, and the Yorcard pilot in South Yorkshire. The department is also working with TfL and ATOC to agree the implementation of ITSO in London.

Our work is not confined to smart ticketing on buses; it extends to the national rail network. The south western franchise, of which there has been some criticism in the House recently, includes a commitment to implement ITSO smart cards across the network by January 2009. The East Midlands and West Midlands rail franchises also include a requirement to provide ITSO-compliant ticketing by 2010. That is clear evidence and proof of our considerable commitment to the use of smart cards and to their effective and rapid development. I repeat what I said in Committee: I do not believe that the issue should appear through amendment to the Bill. Clause 1(5) makes provision for the specification of the permit in regulations. These regulations could—and I have no doubt that the tenor in the House is that we hope that they will—permit an ITSO-compliant smart card in due course when the necessary arrangements are in place.

The amendment as drafted does not actually require the permit to be in smart card form, but allows local authorities to offer ITSO-compliant smart cards as an alternative to permits being in such form as local authorities wish, subject to regulations stipulating form and duration made by the Secretary of State. The option to offer cards in ITSO-compliant form is already available to local authorities, so in an obvious sense this amendment does not add anything to what we already have and are doing. The amendment has the unfortunate effect of taking away the current guarantee that the appearance and function of cards, including ITSO compliance, will be uniform, which is what we are working towards.

Under current provisions, the Secretary of State can ensure that permits issued by local authorities both outside and within London are in a form which he stipulates. This can cover a unified appearance and ITSO compliance. This power to unify is undermined if an option is offered to local authorities instead simply to offer ITSO-compliant cards of whatever appearance, and regardless of any regulations issued by the Secretary of State.

So we think that we are better placed with the legislation as it stands to reach the objectives which we all share and that we have done the work to show that we are going about this in earnest. I hope that noble Lords are reassured by that response.

My Lords, I thank the Minister for that reply. I think that we are all agreed about where we want to get and that we could have something in the legislation to ensure that that happens. There are all sorts of things in legislation that we on these Benches do not support. The Minister went on to talk about the wording of the amendment. Clearly, one wants to look at that. As we are all agreed about this, perhaps we can come up with something in the legislation to ensure that it ultimately happens. We are agreed that we want a national scheme, and obviously that may take time, but we want local authorities to implement it along the lines of the ITSO regulations. I will look at the wording again before next week. If the Minister has anything to add before next week perhaps he could contact us. We are all agreed on the matter, it is just a question of how we get there. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

8: After Clause 3 , insert the following new Clause—

“Reimbursement of travel concession authorities

After section 149 of the 2000 Act insert—

“149A Reimbursement of travel concession authorities

(1) Where a travel concession authority has responsibility for the administration of mandatory travel concessions under section 145A, including the administration and issuing of permits under section 145A(4) and the reimbursement of operators under section 149, the Secretary of State shall reimburse the authority the full costs of administering mandatory travel concessions by means of a direct annual revenue grant.

(2) The Secretary of State shall reserve an agreed proportion of the funding allocated to the mandatory travel concession scheme to provide a contingency fund.

(3) A contingency fund under subsection (2) shall be used to reimburse any travel concession authority for all unforeseen capital and set up costs incurred by that authority in introducing a scheme to comply with this section.””

The noble Baroness said: My Lords, in this amendment, I return to the question of costs. I know that we spent a certain amount of time on this in Grand Committee. I hope that the intervening period has given the noble Lord a chance to consider some of the points raised.

The first question at issue was whether the government have allowed enough money in total to fund the concessionary fares scheme. I accept that it is notoriously difficult to make precise estimates of how much a scheme like this will cost. We have evidence from the introduction of the scheme in Scotland and Wales and also when the full fare scheme was brought in locally. We know that the tendency always was to underestimate the costs. That is not intended as a criticism of anyone, but we need to take it into account that all the evidence is that the take-up of concessionary passes has always exceeded expectations. The use of the fares and the use of the buses have always exceeded the estimates, and operators costs were always higher than planned. Therefore, it seems important that we have more of an understanding of how the Government will keep these costs under review so that local authorities receive the right amount of money for the scheme.

The second set of problems is rather more intractable. I hope that the noble Lord has had some time to think about them because the difficulties faced by individual councils can be quite profound. That is fundamentally because of the Government’s decision to link the funding of the concessionary fares scheme with the overall local government financial settlement. Funding is related to all sorts of strange demographic equations and the complexities of local government finance but is not linked to how many people are actually using the buses. That will cause difficulties for certain councils. Some authorities will receive much less money than they need. That may be because their eligible population is higher than the average that has been allowed for, or it may be because they have more bus-friendly policies, which have created a higher than average demand.

We discussed the issue of honeypot authorities. I referred to Blackpool, but the noble Lord was rather damning in his assessment of Blackpool as a honeypot. Nevertheless, pensioners will want to visit areas such as Blackpool and to use these cards. Therefore, that local authority, which is not particularly well-off, will have to meet higher costs. In that sense, certain local authorities are going to have difficulties.

However, the most intractable problem is the way in which the rollercoaster of local government finance has left some councils with, in effect, a cap on how much money they can receive from central government in grant in any form at all. We heard from the noble Lord, Lord Hanningfield, who I am sure will intervene on this, that government departments can tell us as much as they like how much money they are putting into Essex but Essex is in effect capped in terms of how much it can get from central government. The danger in this scheme is that, although there might be a theoretical amount of money coming in, it will not amount to anything in practice.

The real problem for local authorities is that, if there is a shortfall in this scheme, where will they get the money? Most of them will not want to put up the council tax to meet these costs and some will not be able to because they will be capped. They can have a look at other areas of spending, but they cannot touch education because that is ring-fenced and the social care budget is under huge pressure. What is likely to happen is that, if there is a shortfall in this scheme, local authorities will go back to their transport revenue budget and make their savings there. The biggest single item of spending in those budgets is buses. Therefore, the chances are that we will see a reduction in bus services. Consequently, pensioners will have free fares on buses that do not exist. That is what happened in Tyne and Wear last year, and we do not want to see that situation replicated across the country.

In Grand Committee, the Minister said that he could not provide a blueprint for dealing with this issue. I am sure that that is right and that the House would not expect a detailed, blow-by-blow discussion of exactly how this will be done. However, I think that the House and local government need a bit more assurance that the Government have understood how difficult this is going to be for local authorities and have ensured that mechanisms are in place to deal with this.

It struck me on re-reading the Second Reading debate that a similar question arose about how these concessionary fares are to be refunded along the borders with Wales and Scotland. That was another area on which the Minister said, “Well, it will all happen in the fullness of time”. We do not expect everything to be worked out in finite detail, but neither can we accept the “Trust me, I’m a politician” reply that everything will all right if we only have faith. I do hope that the Minister will take the opportunity simply to put a little more flesh on the bones and say how these difficult issues will be resolved. Local authorities are currently putting their budgets together for next year, and several of them have been in touch with me to say that this area is causing them some difficulty. The authorities that will be the beneficiaries tend to keep quiet; that is in the nature of these things. We hear from the authorities that are in trouble. I beg to move.

My Lords, I support the amendment. We had an extensive debate on this in Committee, and the noble Baroness, Lady Scott, has referred to my local authority again today. There are basically three settlements now in local government. It is nice to know how much money you will get for three years, but a lot of new legislation is introduced in those three years. The Government do not stand still for three years. The amount of money that local authorities will receive for three years is announced, and it is all floors and ceilings and all very technical. My authority is on a floor, as are the local authorities of 15 other counties, and will receive only 2.7 per cent. The Government may bring in new legislation and say that money is available, but that money does not get through to those authorities at all. The authorities must cope with the same amount of money that they have received for three years, plus 2.7 per cent, under not only this legislation but all other legislation that is introduced in that time. This varies a little—as the noble Baroness, Lady Scott, said, there are demographic changes—but the true effect of this money does not come through. There will be another Comprehensive Spending Review and another resetting of things for the next three years, but I do not know whether things will be any better. Indeed, I suspect that they will be even worse than they are now.

I do not normally support specific grants or ring-fenced money but, as the noble Baroness said, under legislation such as this, the money must go to where the expenditure happens. As I said in response to another amendment, we spend £75 million altogether on transport in Essex. That money subsidises buses, community transport, school buses—you name it. We try to get best value by seeing how we can use the money to get a better service and how we might introduce some of the other things that we talked about today, such as helping disabled people use facilities. If we are never going to get any extra money—we are not likely to get any more, the way things are going—bringing in this new legislation will not help us.

There must be some way, not only in this legislation but in others, of getting the money that Ministers announce. When you ask Ministers about that, they do not know. I hope the Minister knew before we told him the last time that some authorities do not receive any extra money. Ministers may think that they have put £200 million or £500 million into a pot, but none of that materialises for many of us. Ministers look at you as though you are daft, but it is true; we do not receive that money, as the noble Baroness, Lady Scott, has said. We must find some way of delivering the money if this legislation is to be fair. We all support this; we all want to make it work. We even want local authorities to have some of the discretionary things that we have talked about today—I know I do in Essex—but we must at least have a little of this money to be able to do that. I therefore hope that the Minister will respond to some of the points that we made in Committee so that the money actually goes to local authorities that need it to provide this service.

My Lords, I am grateful to the noble Baroness, Lady Scott, and the noble Lord, Lord Hanningfield, for contributing to the debate. I must roundly disabuse the noble Baroness of the notion that I cowered at the idea of Blackpool as a honeypot. This busy bee has been there quite often, so I would not dream of suggesting that Blackpool did not have singular and attractive features. I would not be rash enough to engage in a great deal of detail—or principle, for that matter—with the noble Lord, Lord Hanningfield, or the noble Baroness, Lady Scott, about local government finance, as I am all too aware that they know a great deal more about the difficulties in that area than I do. I reassure them both that the Government heartily subscribe to their sentiment that local authorities should be adequately funded by central government for the costs of administering this mandatory concession. We intend to fund fully the new statutory burden. That is why the money was quoted in the Budget Statement and why we have clear figures for each of the next three years for how much it will cost and how much will need to go to local authorities.

The reason why we are not including money in the Bill is that we recognise that circumstances change. Flexibility needs to be built into legislation, otherwise we would never be able to effect improvements except through continual changes to primary legislation. The nature of concessionary travel is that there will be improvements as time goes on, when resources allow. The noble Lord, Lord Low, was fertile this afternoon with areas in which he thought that for what he regarded as quite marginal costs, improvements can be effected. It would not help at all if we had a rigid framework of resources in the Bill.

I hesitate to ask the noble Lord, Lord Hanningfield, this question—he may well answer me and take me down paths that I shall not follow very far—but is he actually saying that the solution to this is a hypothecated grant or a specific grant? I have the greatest sympathy with him; I am all too well aware of the difficulties that local authorities face—and I am delighted to give way to him.

My Lords, I think that, in this case, I am saying that. I repeat that I am not normally in favour of that, but we want to see the benefits of the Bill and that is probably the only way to do that. Will the Minister comment further?

My Lords, I hear what the noble Lord says. That is not a representation that we have been receiving widely on the issue. In fact, we are still working on the premise that the last thing that local authorities want is to be tied down by hypothecated funding schemes. Concessionary fares are an important issue and I am delighted that the noble Lord is treating them with the great seriousness that he is. As he said, this is only a part of even his overall transport budget, let alone of the total expenditure of his local authority and the obligations that it must meet. I am surprised that he is arguing that the Bill should introduce a hypothecated fund.

I hear what the noble Lord says. I must say that issues of local government finance are rather wide of my immediate brief, but the Government do not share that perspective, nor are the present discussions on settlements premised on the assumption that the legislation should have a hypothecated element. The noble Lord will forgive me if I am slightly leery of that argument. The Secretary of State anyway has the power to fund local authority concessionary fares via direct grant if he wishes. If a local authority puts up a case that shows how it can constructively extend the scheme and persuades the Secretary of State of its virtues, that power exists. It would be inappropriate to require in the Bill the use of a funding mechanism in perpetuity in circumstances where we have not discussed the matter with any of the organisations that we consulted on the Bill.

My Lords, I repeat what both I and the noble Baroness, Lady Scott, said: it is important that the money goes where the expenditure is. Some way must be found to do that. It would be nonsense to make a request to the Secretary of State for expenditure. We must find a way of delivering the scheme that ensures that the money does not go into a big black hole and disappear but goes where the extra expenditure will take place. I do not think that that is impossible to do. I am sure that the noble Baroness and I can talk to our colleagues in the LGA, and so on, to make certain that they back that approach. There must be a new approach, otherwise the whole system will collapse. I am sorry to be difficult.

My Lords, I point out that while the Minister tells us that expenditure in Essex is very large and that the authority spends £75 million, many transport authorities on which the Bill will bear heavily are very small, with overall budgets a good deal less than Essex’s transport budget. He must understand the pain being suffered by those authorities. I hope that he can say something a bit more encouraging.

My Lords, it is ever my bent to be encouraging. I am merely indicating that I am not going to have this provision in the Bill because I do not think it is the solution. What I will be encouraging about is this. The Department for Communities and Local Government settlement working group will shortly start discussions with local authorities on the formula grant system and the provision of funding to local authorities over the next few years. Consideration of the funding of the new national bus concession will be taken forward as part of that forum. So there is already a framework for the discussions on which the noble Lord, Lord Hanningfield, is pressing me. But I hear what he says, as will the members of the Government taking part in that exercise. They will be all too well aware of the strong representations made in our debates on the Bill.

I am not convinced that the Bill should be changed to take account of these particular problems. Subsection (2) of the noble Lord’s proposed new clause specifies that a contingency fund will be set up. The extra funding for the national bus concession, up to £250 million a year, already includes an adequate contingency. We are confident that the extra funding we have earmarked is sufficient to cover the total extra costs to local authorities. We are also sensitive to the issue of set-up costs, and the department is working on that in dialogue with the concessionary fares working group. While I recognise the difficulties, what I think the noble Lord, Lord Hanningfield, is seeking to do is to recast a significant concept of local government finance within the framework of the Bill. There are virtues in the points he has made, but there are other fora in which those have to be deliberated upon and resolved.

Reference has been made to Wales during our debate. The current approach whereby local authorities pass on the full costs of their schemes to the Welsh Assembly Government is leading to some very substantial additional costs, and those costs have been increasing every year. In an obvious sense, the Assembly is underwriting all negotiations and all costs being produced by the schemes. We maintain that that is not a good basis on which to ask local authorities to act in developing these schemes. We need to make sure that public funds are spent wisely and, quite straightforwardly, we want an incentive for local authorities to reimburse their costs effectively and by a fair amount. We also want the right of appeal for operators who believe they have been disadvantaged. We have a system where we think the moneys being provided by the taxpayer will be used fairly by operators and taxpayers alike and we are wary of an open-ended position. I am sure noble Lords will recognise the significance of that in the context of the much greater costs in England than obtain in Wales.

I recognise the importance of the points made by the noble Lord, Lord Hanningfield, and supported by the noble Lord, Lord Bradshaw, and the noble Baroness, Lady Scott. This Bill is not the basis for recasting the whole of local government expenditure. We believe that it provides and guarantees a structure within which the resources to which both the Chancellor and the Government are committed for each of the next three years are sufficient to meet the costs of the scheme. They are built into the forward projections on national expenditure. I hope it will be recognised that it would be inappropriate to change the Bill for a concept of local government finance which is still wide open to substantial debate. Indeed, it is not a debate into which we have entered with our partners in quite the way envisaged by the amendment. I therefore hope that the noble Baroness will feel able to withdraw her amendment.

I thank all noble Lords who have supported the amendment.

There is an issue here in how the Government regard their relationship with local government. We are moving from the historical position where free bus fares were a concession given by local authorities, to a national scheme. If we were starting from first principles and the Government were introducing a concession, I have no doubt that the Government would bring in a national scheme and that local authorities would have almost nothing to do with it. But we are at an intermediate point. As a result of this legislation, local authorities will simply be the administrators of a national scheme. They will retain discretionary powers to extend the scheme in certain ways if they wish, and it is right that they should pay the costs when they exercise that power; but in situations such as this where local authorities are required to implement legislation introduced by central government, central government should find the means of enabling local authorities to meet the costs.

It may not be necessary for the Bill to specify minute details of the financial settlement, but the House should consider whether implementation of the legislation will be properly funded and whether local councils can meet its intentions. There are severe doubts whether that is the case.

It is interesting that on such occasions we hear from Ministers arguments about why we should not have a specific ring-fenced grant, and yet local authorities are completely tied up with all kinds of specific grants from all sorts of sources. I wonder why the Government are so resistant in this case when in other instances such grants are usually their first port of call. I would have more respect for the non-specific grant route if the Government had the courage of their convictions and allowed local authorities to spend their money as they wished in every other sense. In fact, local councils would not be in this position if they had more freedom. But they do not, and because they have so little flexibility in their financial dealings, it is difficult for them to manage when a scheme such as this is brought in.

The Minister has not answered the question of what will happen if local authorities face a significant funding shortfall for this scheme. On quantum, the Government may allow the right amount, but if you are local authority X and facing a huge shortfall, the fact that local authority Y next door has made money from the scheme is of very little benefit. There has to be a mechanism that links the provision of the grant with expenditure. That is not unreasonable and brings me back to the question of the use of a specific grant. I hope the Minister will give a little more thought to this issue. Simply saying that a DCLG working group will look at the formula grant system and come back in, say, two years’ time with a convoluted formula which may tangentially touch on the question of concessionary fares will not help the local authorities that have to fund the legislation from April.

When the noble Lord referred to the problem in Wales, he highlighted the kind of situation we can already see coming down the track. The bill to the National Assembly is increasing not because local councils are doing anything wrong but simply because the scheme is so successful. It has to be funded by someone, either the authorities or government, and we are seeking clarification on who will pay.

I shall withdraw the amendment at this stage, but we will have to return to the matter at Third Reading because I do not think that local government will be happy with the responses received today. I beg leave to withdraw the amendment.

My Lords, before the noble Baroness withdraws her amendment, she is certainly aware of the guidance in the House that major points of principle should be decided before the end of Report stage.

My Lords, perhaps I may reply to the noble Lord. We gave notice to the Government that we expected to have a reply today that would satisfy us, and that if we did not, we would press the matter at Third Reading. That has been accepted by the Government Chief Whip. We have been extremely quick in handling this Bill, mindful of the pressures of time on the House. In this case, we have gone to great lengths to ensure that the time of the House is used to best advantage.

My Lords, I merely wish to confirm that statement by the noble Lord, Lord Bradshaw.

Amendment, by leave, withdrawn.

Clause 4 [The national concession: journeys beginning on London bus network]:

9: Clause 4, page 3, line 34, at end insert—

“( ) In subsection (1) for “subsection (3) below” substitute “subsections (1A) and (3) below.”

( ) After subsection (1) insert—

“(1A) The London Authorities shall enter into arrangements with Transport for London under subsection (1) above in respect of journeys falling within section 242(2) below.””

The noble Lord said: My Lords, I return to the effect of the Bill on London. The Minister will recall that I raised the issue of the London reserve scheme in Committee on 8 January. I sought to raise it on behalf of London Councils, the representative body of the 33 local authorities. With Amendment No. 9 and those grouped with it, I am returning to the subject today.

Briefly, the statutory requirement for concessionary fares in London differs from that for the rest of England. Uniquely in London, the powers for local authorities to negotiate concessionary fares are underpinned by a reserve scheme, should the local authorities fail to reach agreement with Transport for London by 31 December each year for the following financial year. If a reserve scheme were invoked, Transport for London would determine the cost of the scheme. We have to bear in mind that Transport for London is the bus operator. London boroughs are therefore at a disadvantage when negotiating with Transport for London. In no other part of the country does the bus provider have so much power. In effect, Transport for London is able to call the shots, when elsewhere in the country concessionary fare schemes are determined by local authorities, subject to appeal to the Secretary of State.

With the national concession on buses provided for in the Bill, there does not seem to be a need for elaborate special legislation for a reserve scheme in London, which takes up a whole schedule to the Greater London Authority Act. With these amendments we seek to take away that reserve scheme; we are simply saying that rollover would apply at 31 December each year if an agreement had not been reached between Transport for London and the London local authorities. I want to point out that London local authorities negotiate collectively for the concessionary travel scheme, and they now have a system that if two-thirds of the authorities agree, the agreement is binding on the remainder of the authorities.

A rollover would apply after 31 December each year, with an appeal to the Secretary of State if there was not agreement. That is not at all different from the rest of the country. The Minister will know that if a bus operator is not satisfied with the settlement, he may appeal to the Secretary of State.

The Local Government Act 1985 is the origin of the reserve scheme. The scheme has never been used, but it is still in statute. The objection is that it allows the operator to set the price for travel if he invokes the reserve scheme, without recourse to appeal to anyone. It is therefore objectionable on those grounds alone. The reserve scheme does not protect against a policy change, so if the London boroughs decided that people were only going to get half their travel in future, it would not protect them against that. However, the reserve scheme generally is thoroughly objectionable. It ought to be got rid of, and that is what these amendments seek to do.

I understand that there is some publicity from the mayor today, saying that this would put the whole of free travel in London in jeopardy. That is a view with which I most profoundly disagree. There is every likelihood that the authorities will continue to negotiate in favour of the scheme. I am trying to draw the Minister’s attention to the existence of the reserve scheme which I believe puts too much power in the hands of the providers of the transport service. I beg to move.

My Lords, I am grateful to the noble Lord for pressing a point on which he elaborated in Committee. I recognise the importance of his representation on this matter. He quoted the Mayor of London’s press release and comments today and said how much he disagreed. He will not mind my saying that I will pray in aid the fact that the Mayor of London, who has some responsibility to Londoners, thinks that this is an important weapon in his armoury with regard to guarantees for Londoners. We agree with him because the purpose of the scheme is to guarantee concessionary travel in London in situations where there is no agreement among the London boroughs or between the boroughs and TfL. Amendment No. 9 seeks to alter Section 240 of the Greater London Authority Act 1999 to replace what is currently a voluntary ability for London boroughs and TfL to enter into arrangements to provide travel concessions with a compulsory obligation to enter into these arrangements. That is a pretty significant change, and I am not surprised that it has caught the attention of the Mayor of London.

I recognise that arrangements for concessionary travel are different in the capital. The 1999 Act secures that the boroughs are able to agree schemes voluntarily with TfL. These voluntary arrangements are underpinned by a safety net—the reserve scheme, which the noble Lord says is unnecessary. If the voluntary arrangements do not meet certain minimum requirements, the reserve scheme is triggered. This has been successful in the past; it has delivered uninterrupted concessionary travel in the capital these past eight years and there would have to be some very strong arguments for removing it.

There is a problem with the noble Lord’s contention. The ability to enter into arrangements implies that both parties do so voluntarily and by agreement, but the amendment says that the parties have to agree. How do you force parties to agree? That interesting little exercise has caused great minds to think throughout the course of industrial relations in this country. How does the noble Lord think that this would occur in London?

My Lords, I wonder, in view of his comments, whether the Minister is aware that the Local Government and Public Involvement in Health Bill, which his Government are putting through, puts a statutory duty of co-operation between local authorities and the health service.

My Lords, a statutory duty of co-operation is different from an agreement about a scheme. Against a background where we know there are grounds for disagreement, the amendment says “By law, you will agree”. There are difficulties with this concept.

I recognise the strength of the noble Lord’s contention. He has undoubted support outside, and there is no doubt that the London boroughs are concerned about the fact that in circumstances in which agreement is not achieved, they are effectively faced with a fait accompli. But the Bill subscribes to the greater cause; it wants to see co-operation and agreement where that can be achieved. The structure in place under the Greater London Authority Act, with which the Bill does not interfere, guarantees that that process can take place. But if that fails, the reserve power has the supreme virtue of reaching the end position to which all of us who have contributed to debates on this Bill have subscribed—namely, that concessionary fares and the geographical extent of them is an excellent concept. Of course, we all applaud the fact that London has been very much in the van of all this work.

I hear what the noble Lord has said but I am not persuaded. I recognise the interests that he represents, and it would be far from me to do anything other than respect those interests. But there is a difficulty with regard to the amendment, and on this occasion I have not the slightest hesitation in siding with the Mayor of London in saying that he needs the reserve power to guarantee that concessionary fares obtain in the capital. I hope that the noble Lord will accept that that is the Government’s position on this matter.

My Lords, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 [Reserve free travel scheme]:

[Amendments Nos. 10 to 13 not moved.]

Schedule 1 [The London free travel scheme]:

[Amendment No. 14 not moved.]

Clause 6 [Requirements as to scope]:

15: Clause 6, page 5, line 6, at end insert—

“( ) After subsection (1) insert—

“(1A) Paragraphs (b) and (c) of subsection (1) above are not to be taken as restricting the concessions that may be provided to eligible London residents on the London bus network by virtue of paragraph (a) of that subsection.””

On Question, amendment agreed to.

[Amendments Nos. 16 and 17 not moved.]

18: Clause 6, page 5, line 24, leave out “bus (in one direction)” and insert “public service vehicle (in one direction); and for this purpose “public service vehicle” has the meaning given by section 1 of the Public Passenger Vehicles Act 1981”

On Question, amendment agreed to.

[Amendments Nos. 19 and 20 not moved.]

Clause 7 [Requirements as to uniformity]:

21: Clause 7, page 5, line 33, after “issued” insert “to the person”

22: Clause 7, page 5, line 36, after “issued” insert “to the person”

23: Clause 7, page 5, line 38, leave out “after “in any form” insert “(subject” and insert “for “document in any form” substitute “permit in any form (subject”

On Question, amendments agreed to.

Clause 9 [Variation of reimbursement and other administrative arrangements]:

24: Clause 9, page 7, leave out lines 11 to 18 and insert—

“(b) altering the provisions about appeals by operators in connection with reimbursement (for example, by altering who is to hear the appeals, the functions of the person or body hearing the appeals or the circumstances in which appeals may be brought); (c) for establishing a body to hear the appeals; (d) imposing requirements as to consultation; (e) repealing section 145A(9) to (11) of the 2000 Act; (f) conferring on the Secretary of State power to make regulations— (i) for any purpose corresponding or similar to any purpose for which regulations may be made by the Secretary of State under sections 149(3) and 150(6) and (7) of the 2000 Act (as those provisions have effect immediately before the coming into force of this section); (ii) about any matter ancillary to the reimbursement of, and appeals by, operators (for example, how to claim reimbursement). (3A) Any power to make regulations conferred by virtue of subsection (3)(f) must be exercisable by statutory instrument which must be subject to annulment in pursuance of a resolution of either House of Parliament.”

On Question, amendment agreed to.

25: After Clause 9 , insert the following new Clause—

“Appeals

For section 150(4) of the 2000 Act substitute—

“(4) An application under subsection (3) shall be made by notice in writing given not later than 56 days after the date on which the arrangements, or the variations, come into operation.

(4A) The Secretary of State (in relation to England) or the Welsh Ministers (in relation to Wales) shall determine the outcome of any such application not later than 120 days after the date on which the application was made.””

The noble Lord said: My Lords, this is the last substantial amendment that we shall deal with today. There has been a great deal of disquiet over the period of 28 days within which operators who are dissatisfied with the agreement that they have reached with the local authority must notify the Secretary of State of their intention to appeal. That period is far too short; it almost means that people have to put the appeal in without any experience whatever of what is happening on the ground. I should have thought that it was reasonable to extend the period to at least 56 days so that there is a reasonable opportunity for a month of experience before an appeal is submitted. Of the appeals made already, a great many were withdrawn after they had been put in by operators who had no option but to put in an appeal as a sort of longstop until some experience was gained. I have tabled a short amendment and hope that the Minister will reply in the affirmative. I beg to move.

My Lords, I am grateful to the noble Lord, Lord Bradshaw, who recognised some of the reservations that the Government had in Committee on an amendment that insisted that the period be 28 days. The noble Lord now suggests 56 days, which is certainly a more reasonable approach. However, I am as yet not convinced by the virtues of that proposal.

I have more grievous worries about the second part of the amendment. The deadline of 120 days for determining appeals would be very difficult to operate in practice. Putting the deadline in the Bill would make it a completely fixed and possibly unhelpful feature, which would require primary legislation to change if we ran into real difficulties meeting it. The deadline would certainly guarantee quicker justice. I recognise that justice delayed is justice denied, but faster justice may not result in better decisions. Experience has shown that the time it takes to determine an appeal is largely dependent on the quality and transparency of the evidence provided by both parties. We have not had particularly good examples of that. The noble Lord will recognise that we are still working through early days of appeals, so we are bound to have reservations about the 120 days within which a determination would need to be in force. If the Secretary of State were forced to determine appeals within a specific deadline irrespective of the quality of the evidence available, poorer decisions might be arrived at.

The noble Lord is right that the Secretary of State ought to determine appeals in the shortest time possible. However, I am not quite sure what would happen if he failed to meet the 120-day deadline. What if the operator wanted to defer an appeal to try to reach a local solution through further negotiations? If the rigid 120-day period were in place, it would inhibit such a development. Appeals need to be considered fairly and consistently, which sometimes takes time. I have real reservations about the measure.

My Lords, what advice does the Minister offer to local authorities with appeals in abeyance that have been on the books for some time? In many cases, in the large PTE areas, they amount to several millions of pounds. They are currently setting their budgets, which is very difficult if there is an open-ended appeal process. Will the Minister comment on their situation?

My Lords, I recognise the force of that point, and the tabling of the amendment in Committee and today provides the opportunity to voice that justified grievance. Although I accept that that puts an incubus on the determination of the appeal in a reasonable time, a 120-day deadline might well result in an unjust decision.

On the 56 days, I recognise that the noble Lord sought to meet the objections that I had in Committee. In any appeal system there needs to be an appropriate balance between the needs of the operators and those of the local authority. I am not at all sure that 56 days meets that requirement. Under current arrangements, local authorities are obliged to notify operators of new reimbursement arrangements some four months in advance of their coming into force. That gives operators sufficient time to make authorities aware of any concerns about a proposed scheme. To negotiate an appeal no later than 28 days after the arrangements come into force seems an appropriate last resort—which is what it is—if negotiations break down.

I know that the noble Lord feels very strongly that 28 days is too short. If he were prepared to withdraw the amendment today, I would be prepared to consider this further and meet him to see whether we can get a meeting of minds on the appropriate time. But largely because of my reservations about the second part of the amendment, I hope that the noble Lord will see fit to withdraw it today.

My Lords, I thank the Minister for what he said. I will certainly be very happy to meet him. I draw his attention to the fact that negotiations over reimbursement tend to take place over time. I know that some negotiations for this year’s settlement continued even after the new scheme had started to operate. Although local authorities should give notice four months in advance, they notified the operator of an unsatisfactory settlement some time in advance and negotiations continued. I am talking about 56 days from the point at which the operator knows what it will get. It is not a long time, and I would be grateful if the Minister made a concession in that direction. Meanwhile, I shall take the opportunity to reflect. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 2 [Minor and consequential amendments]:

[Amendment No. 26 not moved.]

27: Schedule 2, page 14, line 33, after “Part 2)” insert—

“(a)”

28: Schedule 2, page 14, line 34, at end insert—

“(b) insert at the appropriate place— ““London authority” has the meaning given in section 146,”.”

On Question, amendments agreed to.

Schedule 3 [Repeals and revocations]:

[Amendments Nos. 29 and 30 not moved.]

Business

My Lords, we shall have more than enough time to deal with the remainder of today’s business, including day five of the Committee stage of the Mental Health Bill, if Back-Bench contributions to the Welfare Reform Bill last 10 minutes. This is an advisory time. Ten minutes is 2,000 words or thereabouts. One cannot quite put the world to rights, but one can certainly do reasonably well in that time. The reason for this is that when we scheduled day five of the Committee stage of the Mental Health Bill, only 10 names had been put down to speak at Second Reading of the Welfare Reform Bill. One has to make plans a few days in advance, and that was the best guess at the time. Co-operation would be greatly appreciated.

Welfare Reform Bill

My Lords, I beg to move that this Bill be now read a second time.

The reforms in this Bill mark a watershed in the history of social security in this country. They break the link between welfare and dependency; they destroy the old notion that sickness or disability equates to a life on benefit; and they replace the concept of incapacity with a new focus on capability, delivering on the Government’s commitment to reform incapacity benefits, while ensuring security for those who cannot work.

The Bill is premised on the belief in an active, enabling welfare state that matches rights with responsibilities and puts tackling poverty and social exclusion at its core. It enshrines a new and very welcome consensus, founded on clear progressive values of opportunity and security. It is supported by an evidence base that highlights both the crucial importance of these reforms in meeting the challenges of an ageing society and the potential of developments in the management of health conditions for helping people to realise their ambitions in the workplace.

Soon, there will be more people celebrating their 85th birthday each year than starting primary school. The potential implications of this rapid demographic shift are profound, whether in terms of the potential tax burden, the demand for state services or the pensions that people receive. Ultimately, as an economy and as a society, we cannot afford to be denied the skills and contributions of any of those who want to work. Indeed, our economic security and future prosperity hinge on the opportunity for work being open to all.

However, the rewards of work are much more than just economic. A report published only last year concluded that work is central to a person’s individual identity, their psychosocial needs and their physical and mental health. It found that unemployment can lead to higher mortality rates and poorer health, while returning to work improves health by as much as unemployment damages it.

From the amalgamation of the Benefits Agency and Employment Service to the extension of the Disability Discrimination Act, extending the opportunity to work has been at the core of our welfare reform agenda since 1997. We have made work pay through the minimum wage and tax credits, and through record investment in the New Deal and Jobcentre Plus we have begun to create an enabling welfare state that responds to the needs of individuals, pioneering new active welfare support to overcome specific barriers to work. The Bill marks the next stage of that journey, building a modern welfare state, allowing people to exercise this fundamental right to work. Importantly, it takes us a step closer to our aspiration of an 80 per cent employment rate, aspiring for a million fewer people receiving incapacity benefits, as well as a million more older people in work and an extra 300,000 lone parents off benefit.

For too long, people with health conditions and disabilities have been denied the right to work, condemned to a lifetime on benefits because the system presumed them incapable. This has culminated in over 2.6 million people becoming dependent on incapacity benefits. When people come on to benefit, eight out of 10 want or expect to return to work. After two years, however, they are more likely to die or retire than fulfil their goal. The current benefit system does not support their aspirations. That is why the Bill seeks to embed those aspirations within the structure of a new benefit.

Part 1 of the Bill makes provision for the new employment and support allowance which will replace incapacity benefit and income support based on incapacity or disability. That will eradicate the concept of incapacity embedded within the current system, and replace it with the concept of capability. For the majority, this will mean the additional responsibility of being actively engaged in preparing for a return to the labour market in return for the additional support. This is achieved by embedding the principles of the successful Pathways to Work pilots within the benefit structure.

We know that Pathways to Work works. It is the most successful initiative of its kind across the world. In pilot areas, the recorded number of job entries for people with health conditions and disabilities has almost doubled since it started. In return for the additional support provided by the national rollout of Pathways to Work, the vast majority of claimants will be required to attend regular interviews and, in time and when resources permit, undertake work-related activity. Those refusing to engage with the help and support offered without good cause could see their benefit reduced progressively in stages, down to the basic level of jobseeker’s allowance rates.

At the heart of our early success with the New Deal and Pathways is the fundamental principle of “something for something”. Simply to introduce a voluntary system of employment support would be to exclude those who have lost the motivation and confidence to volunteer. Our experiences from existing programmes conclusively show the importance of actively engaging people and the difference it can make to their aspirations to return to work. The added incentive to participate embedded within the benefit structure is therefore essential to its success.

Proof of the success of these measures will not come with a large number of cases where benefit sanctions are imposed, but in the number we can get out of poverty and back into employment. Indeed, in current Pathways to Work areas, where extra conditions have been put in place, around 1 per cent of claimants have been sanctioned, a mark of the success of the deal that we have developed for people on incapacity benefit. A core component of that deal, however, is the recognition that there are some whose benefit it would be unreasonable to make conditional on undertaking work-related activity. For those whose health condition or disability has the severest impact, there will be a higher rate of benefit, exempt from work-related conditions, although they will be able to volunteer for appropriate available support.

The new personal capability assessment (PCA) will make the distinction between these two groups. It is a crucial distinction, on which the Government have rightly consulted extensively. We have been particularly conscious of how important this process is for people with mental health problems and learning difficulties, so we have worked closely with consultative groups on the design of the assessment. Rather than just being focused on benefit entitlement, the new PCA will examine not only what an individual person cannot do but what they can do and what help they need to fulfil their potential. The points system used by the existing PCA to determine entitlement to incapacity benefit through looking at whether people can carry out certain activities will remain. There will be a revised assessment of both physical and mental health, and revised descriptors and point scores will be used.

Following our continued consultation with stakeholders, we intend that regulations will continue to allow the point scores for physical and mental health descriptors to be added together to calculate the final assessment. This decision has been made as a direct result of continued engagement with our stakeholder groups. These regulations will be included in Welfare Reform Bill—Draft Regulations and Supporting Material, which will be available in the Library later this week. Those assessed not to have to undertake work-related conditionality will still have the opportunity to voluntarily access appropriate support. A modern welfare state cannot afford to leave anyone behind. No one will be written off under these reforms.

That is also why existing claimants of incapacity benefits are already able to volunteer for the support available through Pathways; this coverage will be extended as Pathways is rolled out nationwide. Over time, we will migrate existing customers on to the employment and support allowance. I can assure noble Lords that people on incapacity benefits will have their current cash levels of benefit protected. The evaluation of interventions with existing customers in the original seven Pathways to Work pilot districts will help to inform our approach to conditionality for those claimants. As has been the case in Pathways areas since their inception, anyone currently on incapacity benefits will be able to volunteer for any appropriate support on offer. This radical new approach to the treatment of people with health conditions and disabilities will transform not only the lives of the tens of thousands of benefit claimants who will be helped into work but also the lives of their families.

Part 2 provides for the simplification of the existing housing benefit system to improve work incentives and encourage greater personal responsibility. Housing benefit is complex, does little to promote social responsibility and, at times, can act as a barrier to work. It is also a passive benefit. Most claimants have their benefit paid directly to landlords, which means that many are unaware of how much rent is paid on their behalf. It does nothing to prepare people for work and is completely at odds with the active contract which we are seeking to create with our wider reforms of the welfare state.

That is why the powers in Clause 29 will facilitate the rollout of the local housing allowance to all tenants of the deregulated private sector. Local housing allowance bases housing support payments on a system of standard maximum allowances that are calculated according to both the size of household and the location of the property. As with the Pathways programme for those on incapacity benefits, this policy has been tried and tested and has proved successful not only in simplifying the benefit but in promoting fairness and personal responsibility.

Under the local housing allowance pathfinder areas, wherever possible, payments are made to tenants themselves rather than to landlords. This not only promotes financial inclusion and gives people more freedom over their housing choices, it prepares people to move out of benefit dependency and for the responsibility of paying their full rent. The appropriate safeguards are in place for when tenants have difficulty in managing their affairs. However, evidence from the pathfinders has shown that the proportion of payments being made to tenants as opposed to landlords has risen from 40 per cent to 85 per cent. There has been no rise in landlords reporting payments in arrears, which shows that people are taking on the responsibility of managing their housing costs.

Clause 30 seeks to test out a further mechanism for embedding social responsibility into the benefit system through taking the powers to sanction housing benefit from people who are evicted as a result of anti-social behaviour and who then refuse to take up rehabilitation when offered to them.

People have the right to support but they also have a duty to act in a socially responsible manner which does not damage the community in which they live. We have to make a stand to ensure that people realise that there is a line that they cannot cross if they want to continue to expect state support. That is right and fair. We intend to pilot this scheme in 10 local authority areas over a two-year period, with the appropriate safeguards in place for vulnerable children and adults.

Let me be clear: the proposal is not a punishment; it is a measure of last resort to encourage people who have already been evicted to take up the rehabilitative support that we offer them. If we really believe in the principle of rights and responsibilities, there must be clear limits to the behaviour that we will tolerate.

At this point, I acknowledge the debate that has taken place on the single-room rent and the desire of some to see it abolished. I reiterate that the consequences of that could mean that young single people could afford a level of housing which many of their working peers could not. That would undermine work incentives and go against the grain of what we are trying to achieve with the welfare reform agenda.

Part 3 takes forward several measures to improve the administration of social security. It includes powers to improve information-sharing between my department and local authorities. This will help us to work towards our goal of improving the take-up and delivery of benefits—in particular, pension credit, council tax benefit and housing benefit. Common information would need to be given only once to one agency, and that would reap both efficiency gains and improvements in customer service.

Although fraud in income support and jobseeker’s allowance almost halved between 1998 and 2005, there is still a long way to go. For a suspected fraud involving both housing benefit and jobseeker’s allowance, the local authority can only investigate and prosecute fraud against housing benefit. That could mean either that the offence involving jobseeker’s allowance was not investigated or that a duplicate investigation could be carried out by a DWP investigator. Clauses 45 to 47 remove the need for that duplication, both allowing local authorities to conduct investigations and freeing up time and resources for other investigations.

Clause 48 extends the period covered by the “two strikes” rule from three years to five. That means that, if a person commits a benefit offence within five years of a previous benefit fraud conviction, benefit may be withdrawn or reduced for 13 weeks. Extending “two strikes” builds on the positive deterrent effect already shown by the current regime and is a central part of our strategy to reduce fraud in the benefits system.

Part 4 comprises a series of smaller measures correcting some of the anomalies in the benefit system. These include measures to ensure that disability living allowance recipients at the age of 16 do not lose out on three months’ benefit entitlement, as well as amendments to simplify the budgeting loan scheme, which provides support to the most vulnerable in society.

The broad consensus that the Bill has received in its passage so far reflects the fact that it is founded on shared values: values of opportunity for all; the contract between the citizen and the state; and the fundamental importance of work. It extends the opportunities that participation in the labour market can offer to people who had previously been denied that chance. It enshrines rights and responsibilities within the structure of the benefit system, and it provides the legal framework through which a real difference can be made to people’s lives.

I firmly believe that, if we are to meet the challenges ahead, break down the remaining barriers to work and successfully tackle poverty and social exclusion, this Bill is the right way forward. I commend it to the House.

Moved, That the Bill be now read a second time.—(Lord McKenzie of Luton.)

My Lords, I am grateful, as indeed the House should be, to the Minister for introducing the Welfare Reform Bill. It is inevitable that, in a 17-minute speech, he has been able only to scratch the surface of this very complicated Bill. It will create, if only temporarily, no fewer than six levels of benefit under which claimants may fall. Is that really necessary? It will make the social security system even more complex and difficult to administer than it is now. However, I say straightaway that we on this side of the House agree with the policy that the Government are enacting. To that extent, there will be the same consensus here that was widely commented on in another place.

First, we agree on the figures: some 2.7 million people are claiming invalidity benefit, 1 million of whom say they would like to be in some form of employment. It is therefore perfectly rational that the Government should seize on this as an objective. The way they have chosen to do so is to propose a new benefit which turns, as the Minister almost said, traditional social security logic on its head. Rather than concentrate on incapacity for work, this Bill is all about capacity for work. To my mind, that is the right approach. Your Lordships will know that I am a long-term believer in the proposition that the objective of social security is to help people to help themselves.

I therefore have no hesitation in repeating my mantra that disabled people are people first and disabled second. It follows that many disabled people are capable of some work-related activity, which will include unremunerated work as well as salaried employment. We also know that many disabled people want to work. To achieve that ambition it is vital that they have practical support to find suitable jobs and then to remain in employment. It is the intention of this Bill to make that happen.

So far, so good. However, to advance the proposition that 1 million people on existing benefits are to be weaned off them over 10 years causes consternation among current claimants. Two of the recent letters I have received about the Bill are pertinent here. The most recent is the most trenchant. It starts:

“The Government seems to be determined to harass the mentally ill into seeking employment. Why?”.

I hope that the Minister will kill this proposition stone dead and tell us that there is absolutely no intention of harassment of people with mental illness, cancer or any other affliction, not least because, if this idea is generally held, the Government will be suffering from their own spin.

The other letter, which I received just as the Bill was published in another place, is more complicated. That correspondent refers to himself as the full-time sole carer of a sufferer of a chronic mental illness. She receives both incapacity benefit and disability living allowance, though at what rates I do not know. The carer, for his part, receives carer’s allowance and, due to his wife’s chronic schizophrenia, is “unable to work”. He further comments that,

“being a full-time carer is hard enough as it is, without having the constant fear of possibly very harsh reform policy being implemented”.

Clearly, he lives in fear of benefit withdrawal. I replied that I saw no likelihood of that happening, but that I would write to him again if the situation changed. I ask the Minister: was I right in my response? I certainly hope so.

It is noteworthy that both these letters concern mental illness, an affliction that will be referred to many times during the subsequent stages of the Bill. It is easy, in social security terms, to cope with long-term illnesses, whether mental or physical. It is much harder to support those with fluctuating illnesses, or those whose treatment is temporarily debilitating. The obvious example here would be the radiotherapy or chemotherapy of cancer patients, who suffer sometimes quite long periods of tiredness and inability to concentrate once their treatment is completed. The treatment, too, may on occasion need to be repeated, and before Third Reading we will need to be assured that the regulations and administration surrounding the Bill will cover the situation of such patients.

There is a lot in this Bill that we will have to tease out of the Government. My honourable friends were grateful that the Government saw fit to produce many of the regulations flowing from the Bill in draft form during the proceedings in another place. However, some regulations have not yet seen the light of day. I note that the Minister said that two of them would soon appear before the public gaze. I mention in particular those in Clauses 8, 10, 12 and 15. I hope that the Minister will be able to do a little better than produce just two of the four I have mentioned. Three would be excellent; four and I would let him off.

The detail of the Bill rather than the policy concerns us; for example, is the 13-week assessment period too long for some disabled people? Will there be a system for fast-tracking those with terminal conditions?

There are also issues surrounding the assessments; for example, will specialist medical practitioners be involved in the medical rather than the capacity tests? The Explanatory Notes state that there will be a two-part assessment, the first part concerning evidence provided by the claimant and supported by his GP and the second concerning advice to the decision-maker, presumably a lay man, from a doctor or other healthcare professional approved by the Secretary of State. We will have to probe how specific such advice will be or whether it will be of a general nature. We also need to consider the third interview regarding the sort of work or work-related activity it would be appropriate for the claimant to do. One fact about the assessment process that concerns me is that with some conditions, especially in mental health, the claimant does not understand, or even hear, the questions posed by the interviewer. There should therefore be an arrangement like the one that exists now, to an extent, so that the potential claimant can bring an intermediary with him when appropriate.

The Minister referred briefly to migration. I understand that on day one of the new benefit—which I assume will be at the beginning of April, but that is yet to be confirmed—only new cases will be admitted to the new employment and support allowance and no new claimants will be eligible for invalidity benefit. What will happen to those still on IB? I welcome the news that I heard just now that their current benefit will be maintained in cash terms, but will they be allowed to wither on the vine? Will people currently drawing the higher rate of IB automatically be transferred to the support component of the new benefit? What happens to their current passported benefits, such as free prescriptions and housing benefit?

We know, because the Green Paper tells us, that around two-thirds of the 2.7 million people on incapacity benefits have been on them for over two years, and the Minister and his predecessor told us that they are more likely to reach retirement age or die than to gain employment. Those are deplorable statistics. One of the reasons for them is the lack of reassessment or, to put it more fairly, the irregular nature of reassessment. It seems only reasonable that if the state is providing income support for disabled people, it should monitor them, sensitively, of course, but none the less periodically. This is especially relevant for people with fluctuating conditions.

We will discuss these issues and many more in Committee. However, one point is fundamental to the success of the Government’s policy: the attitude of employers. Many employers are reluctant to take on people with disabilities and, in some cases, to keep them on their staff. What will the Government do to encourage them to change their attitude? Are they relying on contractors to do that for them, or does the Minister agree that a concerted campaign by the Government is sorely needed? We need to see a huge increase in flexible employment patterns, and we will want to know how the Government intend to achieve that.

So far, I have commented only on the employment and support allowance. However, the Bill contains rather more than that proposal; there are 40 more clauses. I do not intend to go through all the provisions now, but I shall highlight the first of them, which is housing benefit. At the moment it is paid according to an assessment made by the local authority rent officer of whether the rent charged is appropriate to the area, the individual property and the claimant’s needs. The Bill simplifies that, essentially, as I understand it, by establishing area rent tables for different sizes of dwelling and then setting standard maximum allowances, varying according to the size of the household. At the moment, in many cases the benefit is paid directly to the landlord, and the claimant never sees it. The Minister said that that happens in about 20 per cent of cases. The Government are right that that limits social responsibility, and they wish rent to be paid directly to the claimant’s bank account for onward transmission by standing order, but there are problems. The reason the benefit goes directly to the landlord is that experience has shown that often the claimant does not pay over the money.

If there is to be a bar—and I am not entirely sure whether there will be—on the landlord’s direct receipt, it is inevitable that the private rented sector will stop providing accommodation for people on benefits. Already one sees advertisements for houses to rent in local newspapers with the words “No DSS”. In my local paper last week, there were 15 such advertisements out of a total of 48 properties or rooms—almost a third. If this rises any more, where will rented housing come from? We have enough problems already with the social housing sector. I accept that all this has already been piloted in nine local authority areas; however, I am rather sceptical of the comment on page 6 of the Green Paper that,

“across the pathfinders most tenants have payments made into a bank account”.

Two things strike me about that sentence. First, “most” can refer to any number over 50 per cent; and, secondly, “a bank account” does not necessarily mean the claimant’s own bank account, even a joint one. We will need much more precise information before we can agree to that policy.

As the Minister said, the Government are also taking powers to deprive people of housing benefit following eviction for anti-social behaviour. Here, too, I need to be given a lot of reassurance that that is the right course of action.

Since local authorities administer the passported benefits of housing and council tax benefit, I agree with information-sharing between local authorities and the department, so long as the information is relevant to the inquiries pursued; for example, in suspected fraud cases. I am surprised that such a power does not exist already in social security law. However, I am not enamoured of the Secretary of State’s view that the computer networks of the Government and local government should be linked. What business is it of a general practitioner, for example, to have access to the police national computer?

As I have said, there is much in the Bill to be teased out, not only in revising it—your Lordships’ principal job—but for the information of those disabled people whom the Bill is designed to help.

My Lords, I start by welcoming the noble Lord, Lord McKenzie, to his new DWP duties. I have always found him open, courteous, thoughtful and honest in our exchanges on Treasury matters. I hope that by saying that I am not putting the kibosh on his career when Gordon Brown takes over. The House has been very fortunate in recent years in all its Work and Pensions Ministers: the noble Baroness, Lady Hollis, the noble Lord, Lord Hunt, and now the noble Lord, Lord McKenzie.

I am very fortunate in opening the debate from these Benches to be able to put the problems which the Bill addresses in their wider social and economic context to some extent, particularly because the real experts on disability—my noble friends and colleagues on our team, Lord Addington and Lady Thomas of Winchester—will be bringing all their practical experience and passion to bear, as your Lordships will hear shortly. We very much look forward also to the contribution of my noble friend Lord Kirkwood of Kirkhope, with his long and distinguished record in another place.

We heard about consensus from the noble Lord, Lord Skelmersdale. We all agree with the ends of the Bill; we differ only on the means. We welcome the measured and balanced tone of the Minister’s opening speech today.

Some 2,700,000 people are on incapacity benefit—almost one-tenth of the 29 million people now at work in this country. It is a truly shocking statistic. We know that the first big surge on to benefit came in the Thatcher years as the pits, the mills, the steelworks and the shipyards shut down, leaving middle-aged men with no realistic prospect of finding work in depressed areas such as south Wales and the north-east. They are the casualties of deindustrialisation, and you can still see a marked difference between the rates of incapacity in southern England and in the rest of the UK. But now we are suffering a second, different surge, this time from the casualties of our fractured society. Over 40 per cent of people now on incapacity benefit have mental health problems such as depression or schizophrenia, 40 per cent of them women. My noble friend Lady Thomas will go into much more detail on that. But why, for example, is cognitive behaviour therapy for depression not much more freely available from the National Health Service, as the noble Lord, Lord Layard—whom I am delighted to see in his place—has argued so strongly?

Last week my colleagues and I visited the jobcentre in Stockwell, just over the river. In Lambeth the overall employment rate is only 63 per cent compared with almost three-quarters nationally. In Stockwell and Brixton, it feels even lower. We were very impressed by the dedication and professionalism of the staff we met, who were trying to do their best for vulnerable people who often have serious mental health problems. The staff told us that they needed more training and more immediate access to specialist advice. My noble friend Lord Addington will expand on that later and will be moving relevant amendments in Committee.

I was also struck by the number of large gentlemen standing round in uniformed blazers. I was told that they were customer care officers, but they were supplied by Group 4 and looked awfully like the security men I see just up the road guarding the tills at Tesco in Kennington Lane. Of course jobcentre staff must be properly protected, but it is a sad commentary on the state of our society 10 years into a new Labour Government that the staff need so much protection from the people whom they are there to help to find work or secure the benefits to which they are entitled. What a waste of scarce resources on essentially unproductive security that is when eight of the 52 posts in that jobcentre have had to be cut as part of the massive DWP job-reduction programme over the past few years. Good management and dedicated staff can take you only so far; resources—and that means money—are the key to giving a sensitive and effective service to the hundreds of people with varied needs who come to jobcentres every day.

Getting 1 million or more claimants into work is a daunting task, but the payback for our economy and the Exchequer, if we can pull it off, will be immense. Can the Minister give us chapter and verse on how the Pathways to Work programme, which he mentioned, will be rolled out across the whole country and convince us that the Department for Work and Pensions is not trying to make water flow uphill by trying to do this at the same time as front-line posts are constantly being cut? Is “one million into work” just a typical Tony Blair instant initiative for a cheap and nasty headline in the Sun, or is it really a firm long-term commitment with the political will and the cash to make it happen? You cannot solve a persistent deep-seated, institutionally ingrained problem like incapacity on the cheap.

Can the Minister also tell us which categories of claimants will be worse off as a result of the Bill? Will vulnerable people now have to wait longer to receive the full benefit to which they are entitled if they pass the assessment, instead of having payments backdated to the date on which they first claimed? How does he reply to the Child Poverty Action Group, for example, which points out that families will have to wait up to 13 weeks on the jobseeker’s allowance before they receive the employment and support allowance? Can he also tell us how his department will respond to the very cogent criticisms of the citizens advice bureaux that,

“a quantum leap in the quality of medical assessment and decision making is necessary”,

in view of the 60 to 70 per cent appeal success rate for disability living allowance claims? What about the view of the citizens advice bureaux that the quality of ATOS ORIGEN doctors’ assessments of suitability for benefit must be improved?

The citizens advice bureaux speak with great authority because they see thousands of people every day. Perhaps I may add one case from my own personal experience. I will write to the Minister with full details and ask him what went wrong, but the essential facts are these, and they confirm everything that the CABs and others say about the difficulty of sanctioning people with mental health problems and the poor quality of decision-making. A young man I know has been receiving disability allowance because he has severe mental health problems. He has been sectioned three times under the Mental Health Act, most recently from January to June last year. Last August, he was sent a letter telling him to attend a medical assessment in Enfield—he lives in Brixton by the way—and containing a 20-page questionnaire. He did not attend the interview or fill in the questionnaire and a few weeks later his disability allowance was cut off. Like many other people suffering from severe mental problems, he does not open his post, and if he did, he certainly would not have been able to fill in the questionnaire. By chance, the young man’s father called in recently. He discovered what had happened and that his son’s benefit had been cut off without either his legal guardian or social worker being informed, although both their addresses were on file.

How many other highly vulnerable people are penalised in this way, people who perhaps have no relatives or friends able to complain on their behalf? Again in the words of the CAB,

“the DWP needs to focus much more strongly on what it should do to prevent such injustice”.

On housing, we on these Benches, like Shelter, the Child Poverty Action Group, the Scottish Council for Single Homeless and many other organisations, oppose the single room rent restrictions and will be moving amendments to that end. We are in very good company; in 1996, just before they came to power, Tony Blair, Gordon Brown and John Hutton all voted that same way in Parliament. What has changed?

Along with these housing organisations and many others, we also have grave reservations about Clause 30 of the Bill, which withdraws housing benefit following eviction for anti-social behaviour. This really would be visiting the sins of the fathers on innocent children. If this provision, as the Minister has just told us, is being piloted for two years, it should be subject to a sunset clause so that, unless it is renewed, it automatically lapses after that period. We shall, I am bound to say, need some more persuading from the Minister in Committee if we are not to oppose the clause outright.

The Bill acts on the supply side of the job market. It attempts to encourage and help people to apply for jobs, which we wholly support, and penalises people who do not co-operate. Here we will be trying to save the Bill from unfairness and sanctions that do not work. However, the demand side is just as important. How do the Government plan to encourage and persuade thousands of employers that people with disability or mental health problems can be productive, reliable and, let us be frank, profitable employees? Otherwise the Government might just as well be pushing on a piece of string, and any idea of getting a million people, or even several hundred thousand, off benefit and into work would just be moonshine.

I touched earlier on the problems that people with depression and other mental health problems have in getting real help from the National Health Service. In this Bill we are also trying to pick up the pieces from another failure of so-called joined-up government—in basic education. In our work in the Economic Affairs Committee of this House, the message comes across loud and clear from employers that far too many of our people lack the most basic skills in reading, writing and simple maths. “Working on the Three Rs”, the joint study published last August by the CBI and the Department for Education and Skills, says:

"Poor basic skills damage people’s lives and their employment prospects. Weak functional skills are associated with higher unemployment, lower earnings, poorer chances of career progression and social exclusion”.

Exactly. For the least well educated 20 per cent, Britain’s record is far worse than that of Germany, France and the other main European countries. Instead of wasting our children’s time by teaching them Britishness, whatever that may mean, we must give them the most basic life skills of all—the ability to read, write and add up. Our competitors do not teach their young people to be German; they teach them a trade.

So we are all on the same side with this Bill. As we scrutinise it, improve it and help it on its way through the House, our watchwords on these Benches will be training and fairness; encouragement not punishment; carrots not sticks; practical help and advice, not threats. In my experience, those work better for most people most of the time, whether employed already or still stuck on benefit. Britain is one of the world’s richest economies and, in the Blair decade, the wealthiest in our society have grown richer, often beyond their wildest dreams. It is high time to help many more of our people into productive work so that they can share in building and enjoying our prosperity and not suffer, as all too often happens, in the shadows of our society. In that fine cause, we must all work to produce an Act of which Parliament can be proud.

My Lords, I, too, thank the Minister for introducing the Bill to this House. I want to speak at rather greater length than the noble Lord, Lord Oakeshott, about the housing benefit sanctions placed on those who have been evicted for anti-social behaviour. In doing so, I affirm the aspirations set out in the Government’s Respect Action Plan, in which they write:

“We want to create a decent, civil society in which people can shape their own lives and participate fully in their local community”.

I recognise, as all of us do on these Benches from our pastoral experience in our dioceses, the negative impact that crime and anti-social behaviour can have on neighbourhoods, communities and, in particular, the lives of children and young people and their families. At this point I declare my interest as chair of the trustees of the Children’s Society in what I have to say. My work with that charity repeatedly reveals that children often become the victims of other people’s behaviour. I suggest that this Bill, if left as it is, will continue that trend. Of course, I support proportionate responses to prevent criminal anti-social behaviour but I have grave concerns about the proposal to reduce or remove entitlement to housing benefit from families with dependent children.

Any proposals brought forward must be considered with respect to their specific impact on children and young people. As noble Lords will know, the rights of this group are defined under both domestic and international law. I draw your Lordships’ attention to the principle of ensuring that all decisions are made in the child’s best interests under both Article 3 of the United Nations Convention on the Rights of the Child and the Children Act 1989. This principle is reinforced in the Children Act 2004 and in the Every Child Matters agenda, in particular the outcome to achieve economic well-being, which includes as its aims “Live in decent homes” and,

“Live in households free from low income”.

The proposals in this Bill directly contradict the five outcomes framework of Every Child Matters and, in my view, will lead to greater social exclusion for some children and families.

I turn to the issue of child poverty and protection inherent in Clause 30. I believe that the introduction of the principle of conditionality to housing benefit entitlement may inadvertently place children at risk and undermine the Government’s pledge to eradicate child poverty. I believe that basing delivery of welfare benefits on behaviour, rather than on need, represents an attack on the fundamental principles of welfare provision.

Those in receipt of housing benefit have already demonstrated that they are in need of financial assistance. That assistance is already calculated on the basis of a minimum standard of living. While the draft regulations make provision for a maximum level of benefit reduction of 30 per cent for claimants who have responsibility for a child or young person, it must be recognised that any reduction would likely result in homelessness, indebtedness and destitution for some of these families. A 30 per cent reduction in housing benefit may make it impossible for the parent or parents to provide sufficient financial support for the child or children. In extreme cases, it may lead to the need for the child to be placed in the care of the state. A key principle of the Children Act 1989 is that a child should be removed from their family only if they are at immediate risk of significant harm. Surely that principle must remain in place.

The Government intend the offer of rehabilitation to address not only the symptoms but also the root causes of problematic behaviour by linking reductions in housing benefit with the offer of appropriate rehabilitation. However, I question the likely efficacy of this approach when evidence in relation to parenting support, for example, shows that voluntary interventions are more effective than coercive ones. I am concerned that the clause does not set out how the offer of rehabilitation will operate. For example, it is not specified whether the conditions will consist solely of a requirement to take part in rehabilitative programmes or whether they will also include, where appropriate, referrals to mental health or substance misuse services, training programmes or family therapy.

The current proposals could aggravate an already complex situation. It is also unclear whether the sanctions placed on a named individual are intended to punish the parents, the children, the family or whoever in that family is principally responsible for the alleged anti-social behaviour. That is pertinent, as any accompanying rehabilitative or supportive programme must identify and address the behaviour, and whatever is causing it, of different individuals with their different needs and concerns. The programme, as described in government literature, is meant to deal with group behaviour. It is unlikely to be able to do both.

Finally, I have serious concerns about the availability of such intensive therapeutic programmes. Can a local authority that decides to refer a family to such a service guarantee that places will be available on that programme? If no place is available or the family is placed on a waiting list, does the reduction in housing benefit still apply? Unless the availability and quality of support can be assured, such a system would be setting people up to fail. The proposals are inequitable and discriminatory, as they apply only to those in receipt of housing benefit. Although the Government have outlined their intention to introduce a house closure order to deal with anti-social owner-occupiers, as currently described, the order would be in force for up to six months, whereas this clause permits the removal of housing benefit for up to five years and is not attached to any requirement to attend a programme of rehabilitation. Thus, those dependent on state benefits receive a harsher penalty than those who can afford to own their own property.

I am also concerned that the measures may inadvertently punish those who cannot control their behaviour, such as those with mental health problems or learning difficulties, to whom noble Lords have already referred, or those who cannot control other family members or visitors to the home. The general point is that the anti-social behaviour of children and/or their parents does not happen in isolation. This behaviour is the manifestation of a complex plethora of problems and issues that need to be addressed appropriately. Many of these families have a history of strained relationships with statutory agencies and personnel, and reducing housing benefit to coerce them to take part in a rehabilitative programme is extremely unlikely to be effective.

My Lords, this is a profoundly important debate for people among the most needful in Britain today—one in which I have interests to declare both as the first Minister for Disabled People and a serial legislator on their problems, needs and rights. Interestingly, the debate takes place very close to the date, 37 years ago, when your Lordships’ House gave a Second Reading to my Private Member’s Bill that became the Chronically Sick and Disabled Persons Act 1970. My friends—then, as now—the noble Baronesses, Lady Masham and Lady Darcy de Knayth, made their maiden speeches.

As they know well, all our current disability benefits are founded on legislation promoted during my years as Minister for Disabled People from 1974 to 1979: incapacity benefit; the non-contributory invalidity pension, often described as the severe disablement allowance; the mobility allowance; the disabled housewives’ allowance; and the carers’ allowance—all of them were aimed at reducing the socially handicapping effects of disability. Thus I have a deep personal interest in the Bill.

In legislating both as a private Member and a Minister, my priorities have consistently embraced that of seeking to secure for disabled people the employment opportunities needed to end their dependence on social security payments and to achieve the independence and dignity of becoming taxpayers. My approach this afternoon will be informed by that priority.

The Bill has the potential to bring considerable benefit to hundreds of thousands of disabled people now in danger of drifting away from the world of employment due to the failure of others to understand their needs. Crucially, it offers rehabilitation and work-focused support to help to simplify the life-changing transition that appropriate employment opportunities can bestow, and is further evidence of the Government’s commitment to bringing disabled people more into the mainstream of social life by providing support appropriate to their needs in achieving and retaining the right to work.

I am delighted that my noble friend Lord McKenzie is promoting the measure. He has made an excellent start in his new ministerial role, and I wish him well. As he will know, concerns have been expressed by disabled people and their organisations about a range of issues, some of which I shall touch on today; but, meanwhile, his presence itself vouchsafes careful consideration of their concerns, as does the involvement and input of Anne McGuire as the Minister for Disabled People. She has an admirable record of achievement and an abiding commitment to do the right thing by long-term sick and disabled people.

One of the issues that disability organisations have raised is their concern about the Bill’s proposals for engaging with employers. The new benefit that it proposes—the Employment and Support Allowance, or ESA—would place conditionality on people in receipt of the work-related activity component to attend work-focused interviews and undertake agreed work-related activities. This contrasts sharply with the absence of measures for tackling employers’ resistance to employing disabled people. That resistance is real, as the Disability Rights Commission and the UK Disabled People’s Council have emphatically made clear. The DWP’s own report—No. 202—says that nine out of 10 employers think that employing a person with impaired vision would be either difficult or impossible. But it is of double concern that employers are not only resistant to employing disabled people; they are also unaware of the extent of support available to them in employing a disabled person. As of now, 74 per cent of employers are not aware of the Access to Work scheme and its support for meeting extra costs when employing a disabled person. So they still perceive disabled people as potentially expensive to employ, with scant help available from the Government.

Turning from employers back to claimants of ESA, it is instructive to look at the proposals for payment of the allowance to people who are seriously ill and/or disabled through cancer treatment. As Macmillan Cancer Support has shown, they can be forced to attend work-focused interviews because of the way in which Jobcentre Plus uses its discretionary powers. Macmillan welcomes the Government’s recognition in Committee on the Bill in the House of Commons that it would be wrong to treat people undergoing treatment that in itself has very severe disabling side-effects as capable of work-related activity.

As of now, receiving radiotherapy and non-invasive forms of chemotherapy are not protected from conditionality via inclusion in the support group which, in Macmillan’s view, must be changed. It insists that the best way to stop people who are physically ill and/or disabled through cancer treatment being pressured to attend work-focused interviews is to include all patients undergoing active cancer treatment and the terminally ill in the support group.

Cancer poverty is a particular problem for people of working age and their families. Macmillan’s research shows that of those aged 55 or under, seven out of 10 households suffer a loss in income averaging 50 per cent following a cancer diagnosis, making disability benefits extremely important to them.

Yet a great many people with cancer miss out because they are unaware of benefits to which they are entitled. As the National Audit Office has reported, 77 per cent of cancer patients are not given information about financial support, while Jobcentre Plus staff rarely inform them of disability benefits administered by the Disability and Carers Service. Indeed, the scripts used in Jobcentre Plus call centres do not include any prompts to give information about disability benefits.

In summary, Macmillan wants the agency’s scripts improved so that claimants know about all their benefit entitlements, together with measures to ensure that the focus is more strongly on improving take-up. The charity wants Jobcentre Plus routinely to refer claimants to sources of guidance, information and advice, such as the DWP’s own benefits inquiry line, as well as disability awareness training for front-line staff.

If we are to fulfil the admirable aspiration of helping a million more disabled people into work during the next decade, we must urgently challenge unfounded concerns about employing disabled people and make strongly renewed efforts to publicise the help available to employers.

Parliamentary replies state that the DWP spends £320,000 a year on marketing and publicising its disability services and programmes, of which, such is their number, the sum available for publicising Access to Work is small. For many disability organisations, this explains why the department's message is not reaching most employers. They feel, too, that a Bill such as this could have something to say on the key role of ministries other than the DWP, such as the Department of Trade and Industry, in putting together a cross-departmental strategy for countering employers’ concerns about taking on disabled people. Moreover, they say that without such a strategy,

“there must be serious concern about achieving the aim of getting a million disabled people off benefits and into work”.

The Commons Public Accounts Committee report on DWP support for disabled people states:

“In 2004–05, the Department for Work and Pensions spent around £320 million funding a number of programmes and schemes to help disabled people find and stay in employment. However, they reach only a minority—160,000—of those who could potentially benefit”.

Unsurprisingly, this prompts disability organisations to query the adequacy of the £360 million promised to roll out Pathways to Work nationally when, as we have seen, the £320 million spent on funding other programmes reached only 160,000 people; perhaps my noble friend could have that seemingly well founded concern looked into urgently.

I turn very briefly now to some other points worthy of attention. The first concerns the Bill's title. It surprises many disabled people that the word “welfare” is itself in the Short Title when the emphasis in this policy area is on rights, not on “welfarism”. Why, I am asked, is the measure not called the “Disabled Persons Employment and Support Bill”?

A further point raised with me by their organisations is that disabled people should be more protected against the popular assumption that fraudulent claiming of disability benefits is rampant whereas, to take just one example, at 0.1 per cent, the rate of fraudulent claims for incapacity benefit is the lowest for any major benefit. The much bigger problem here is low take-up by entitled people.

Finally, I am asked also to press the issue of sanctions as dealt with in the Bill. The DWP's analysis last year of the Pathways pilot areas showed the number of sanctions imposed on claimants to be about 0.4 per cent of all benefit starts in Pathways. Is the department convinced that this finding justifies the Bill’s significant powers of sanction, given the widely accepted figure of 1 million disabled people who want to work but are left waiting for the right help and support to enable them to do so? It is put to me:

“We clearly have the carrot in the form of the help and support being offered, but do we really need a stick in the form of sanctions when so many disabled people crave the right to work?”.

I know my noble friend will not be able to respond today to all of the points raised with him in the debate, but I hope that he will at least have time to say more in his winding-up speech about engaging with employers to promote the support available to them and challenge negative attitudes about employing disabled people. No Bill that I have known in all my years in Parliament was incapable of being improved by constructive scrutiny and I hope the points I have raised today will help to ensure the Bill's emergence from parliamentary scrutiny as one that disability organisations, employers and all the departments involved can accept as well worth speeding to the statute book. I wish my noble friend all success.

My Lords, it is a pleasure to follow the noble Lord, Lord Morris of Manchester, who has done so much for disabled people over the years.

The Pathways to Work pilot schemes have demonstrated that a great many disabled people of working age want paid employment. Being out of work is alienating, unsociable and, for many, begins an inevitable slide into poverty. Being out of work for a long time is even worse, as confidence levels plummet, with unemployed disabled people quickly believing that they are completely unemployable, leading to feelings of worthlessness. So I welcome the purpose of the Bill, which has the ambitious aim of trying to reduce the numbers of disabled people on incapacity benefit by helping them enter the workplace. I very much hope that the Government have allocated enough resources to this ambition—£360 million over two years does not sound very much—and that they are still listening not just to Parliament but to all the expertise in the specialist voluntary organisations that work tirelessly for their client groups.

Those suffering mental health conditions, who, as we have heard, account for about 40 per cent of those on IB, are among the most vulnerable people that the whole scheme must try to help. If more help was available to deal with mental health problems in the early stages, perhaps there would be fewer people with that problem on benefits. After all, more money spent early on is bound to be cost-effective. Are there, for example, enough cognitive behavioural therapists working in the National Health Service? What has happened to the health and well-being strategy which is supposed to be running alongside the Bill?

It is especially important that personal advisers at jobcentres are trained properly in helping vulnerable people who are trying to overcome their problems and enter or re-enter the workplace. Here I am particularly concerned about the sanctions regime in the Bill which, as others have said, could add to the stress and intimidation felt by those prone to mental illness. Will the Minister confirm that decision-makers have some discretion in the imposition of a sanction if a claimant falling into this category misses, for example, a work-focused interview without necessarily giving a “good cause”?

Employers also need to be especially understanding with employees suffering from fluctuating conditions such as clinical depression, and there is a strong view amongst specialist groups that not enough attention has been paid to the vital role and responsibility that employers have in ensuring the success of what the Government are attempting to do. Although employers of disabled people are very positive about the experience, there is no question that most employers continue to discriminate against disabled employees. That fact is borne out by the statistics reported in the Joseph Rowntree Foundation report Monitoring Poverty and Social Exclusion 2005. The Minister for Employment and Welfare Reform, Mr Jim Murphy, said in a debate on 29 November in the other place that the Government needed to do more to engage employers, and I wonder what they have in mind. Unless there are stronger requirements for employers to assist employment in the future, many disabled people in the employment group are going to be condemned to engage in endless work-focused activities with no prospect of a job.

No one can say that the Bill is making the whole disability benefits field simpler, as the noble Lord, Lord Skelmersdale, said. A complex web of procedures is set out in the Bill, starting with the familiar personal capacity assessment although, of course, in a new form. We have not yet seen the draft regulations for this test—they are promised tomorrow—which does not give us much time to examine them properly before the Committee stage. However, the specialist groups have seen the draft proposals and there is great concern about the proposed withdrawal of several low-scoring physical descriptors. I do not think the noble Lord said that they have been restored, so I assume they are still withdrawn at present. The point of having descriptors such as, “Can only walk up and down a flight of stairs if he goes sideways or one step at a time”—I can identify with this—is that those people who fall into such a category need help and support with work. They are not necessarily seeking exemption from work, but they need physical obstacles to be taken into account lest they get forgotten. However, I welcome the announcement made by the noble Lord that the physical function and mental health function will be added together, which shows that there is now movement towards a social rather than just a medical model of disability; that is very welcome.

Still on the subject of the personal capacity assessment, presumably there will still be a request for information from the claimant’s doctor. I urge that this process is closely monitored. The claimant should be given an up-to-date assessment before the report is sent in, and then it should be sent in as soon as possible thereafter. We hear that many doctors do not submit a report in time for the claimant’s PCA. The up-to-date doctor’s report at the outset would surely save a lot of time wasted in later appeals, the majority of which are successful.

My last word at this point on the PCA comes from my experience of claiming disability living allowance, which was only granted on appeal, and here I must declare that particular interest. The form asked how far I could walk outside unaided. This is a difficult question and the form seemed well designed to take a range of answers into account, yet I was marked down because I was not VUTW. I had to phone up to ask what that meant. It means virtually unable to walk. None of my comments had been taken into account at all. Was it anything to do with a computer only understanding black and white answers, I wondered? In which case, God preserve all claimants from what a Member of the other place cited as, “Computer says ‘No’”. Watchers of “Little Britain” will recognise the phrase. What is the role of the computer is in this particular assessment? Is it the case that if pre-coded answers are not given, any non-standard responses on the form will not be attached to any particular descriptor and might just as well not have been written? Does that not make the case for having an independent assessment of the whole PCA process, and many dummy runs, before national roll-out?

I turn now to the subject of the work-focused health assessment. First, it is very important that assessors are able to call on specialist knowledge of certain conditions, and my noble friend Lord Addington will expand on this point. The second matter is the understandable concern that by undertaking this assessment at the same time as the main PCA, claimants will have to focus on what they cannot do and what they can do almost simultaneously. It is quite likely to be in the disabled person’s interest that they do not have to make two trips to the medical centre for these two tests, and quite a few claimants obviously will not need to take the second one, but it does raise questions. Will the two tests be entirely separate and will the decision-maker be the same person on each occasion, or will the answers to one test influence the other? Perhaps the Minister can enlighten us as this is a worry to several specialist groups.

Before leaving this part of the Bill, why will no benefit entitlement except for those with a terminal illness be backdated to the start of a claim; that is, roughly the 13-week assessment phase when the benefit is at the lower jobseeker’s allowance level? I know this is not the not the first time that the question has been put this afternoon, but it seems unjust, particularly for those in the support group. Is this the only benefit which will not be backdated to the start of the claim?

I should like to look at the whole question of passported benefits, an issue also raised by the noble Lord, Lord Skelmersdale. I refer to benefits such as free school meals and prescriptions, housing and council tax benefits. This was hardly touched on during the Bill’s scrutiny in the other place. Will the Minister set out at some point just where the triggers are with the new employment and support allowance? However, there are almost certainly too many variables for a simple explanation now. A question involving passported benefits was put to me the other day in relation to the help and support a disabled person needs when they start work, and it is one which goes to the heart of the Bill. If a severely disabled wheelchair user whose circumstances mean that she is currently on income support and who is at present entitled to passported benefits wishes to seek a proper job—that is, a job with more hours than the permitted work rules allow—using her new skills acquired at an FE college, will there be adequate support available? A person such as this is unlikely to take the plunge into the world of work without such support in case they had seriously misjudged their ability to cope. Will there be enough flexibility in the system for such a person, after completing the transitional period, to go back on to benefits if necessary without starting from scratch? The phrase, “What if I find it all too much?”, is one which must be familiar to personal advisers. I should be grateful for the Minister’s comments on such a case.

This brings me to the Access to Work scheme, which has been described as one of the best kept of all Government secrets. One of my disabled friends is a highly gifted primary school teacher in a north London borough who can only do her job thanks to an Access to Work scheme helper who writes on the blackboard, carries books, photocopies and does all the practical tasks my friend cannot manage. Are there any plans to make this excellent scheme better known? When Pathways to Work is rolled out nationally, it must surely be the case that the Access to Work scheme will have to be expanded, and I hope this has been taken into account in its budget, particularly in the number of staff engaged in administering the scheme. Perhaps we could have a reassurance on this point.

Finally, I wish this Bill had had pre-legislative scrutiny, given that it is a carryover Bill. The Government may say that the Green Paper and the successful pilot schemes carried out so far are enough, but they are no substitute for detailed parliamentary scrutiny. The problem is that the regulations which will have to be made under the Bill are just as important as the Bill itself, and they cannot be amended. Obviously all social security Bills have to contain detailed regulation-making powers, but sooner or later Parliament is going to want a better way of having its say about what is in these important regulations. The Delegated Powers and Regulatory Reform Committee can warn all it can and the Merits of Statutory Instruments Committee can play its part after Bills become law, but when all is said and down, the balance is still heavily tilted towards ministerial fiat becoming law. We in this House can seek to make the most important regulations come under the affirmative process more than just the first time, or suggest amendments in a non-fatal Motion, or use the blunt instrument of a vote against the whole order. However, none of these courses of action is really satisfactory, so I urge the Minister to keep an open mind on what should go in the regulations before the Bill leaves this House. There are many other matters of concern to be explored which I have not had time to mention, and I look forward to a more detailed scrutiny of the Bill in the weeks to come.

My Lords, this Bill has the potential to greatly improve the support and opportunities available to disabled people, who have for many years not been sufficiently seen as able to move towards or engage in work. I therefore welcome the recognition by the Government that disabled people on incapacity benefit should not be written off and sidelined for the rest of their working lives and that those who have left work because of illness or disability should be assisted to move back towards the labour market. I should also like to pay tribute to the way the Minister and his department have, like his predecessor, been anxious to engage in dialogue with noble Lords over the Bill. I look forward to approaching its passage through your Lordships’ House in the same spirit of dialogue, which is the surest way to achieve the best outcome for those the Bill seeks to help.

The Disability Rights Commission has produced statistics of the employment disadvantage experienced by disabled people which are too numerous for me to catalogue in full but which are frightening in their import. Whilst the number of working age disabled people in employment has increased over the past decade, 48 per cent remain outside employment. For people with a mental illness or a learning disability the percentages are 80 per cent and 90 per cent respectively. Due to stigma and discrimination, fewer than four in 10 employers would consider employing someone with a history of mental health problems, compared to more than six in 10 for candidates with physical disability. As the noble Lord, Lord Morris of Manchester, has reminded us, as many as 90 per cent of employers say that someone with a visual disability would be difficult or impossible to employ. On average, disabled people earn 10 per cent less than non-disabled people at every level of qualification, and 40 per cent of people on incapacity benefit have no formal qualifications at all.

The DRC welcomes the opportunity presented by the Bill to create an alternative future where, in return for taking steps towards work, disabled people can anticipate high-quality personalised support, wider employment opportunities, a labour market in which disability discrimination is eradicated, equal pay and prospects for advancement which make work pay both for them and their families. For this to be realised, the right conditions must be in place before conditionality is applied. The DRC fully accepts that with rights come responsibilities and that, as disabled people's employment rights and opportunities increase, so should society's expectation that more disabled people will make moves from benefits into work. Indeed, it is low expectations which are often at the root of the discrimination many disabled people face. But acceptance of greater responsibilities to work must be matched by the responsibilities of employers, employment support services and government, and should not place disabled people or their families in hardship. Applying conditions without adequate opportunities and support is not only unjust, it is a recipe for failure.

The DRC has a number of proposals for delivering its alternative vision. These are too numerous to list here but may perhaps be summarised in the following way. Entitlement to employment and support allowance should be based on work-related disadvantage, not limited capability. During the Bill's passage in another place, there were proposals to change the conceptual basis from “limited capability for work” to “work-related disadvantage” in an effort to highlight the external, non-medical dimensions which shape disabled people's employment opportunities, and through doing so, ensure greater consistency with developments such as the Disability Discrimination Act. This would provide a clearer picture of the specific challenges, both for particular individuals and structurally within the labour market, which need to be addressed to promote and widen employment opportunities for disabled people.

Your Lordships will be aware that concerns have been expressed by disabled people's organisations about a number of aspects of the Bill. One concern is the relationship between the work-focused health-related assessment, which is intended to explore what abilities a claimant has and what support might enable them to move towards work. As I understand it, this assessment is to be carried out immediately after the claimant has undergone the personal capability assessment interview, where they are interviewed about their application for employment and support allowance and how their impairment impacts on their ability to work. I am concerned that to have a discussion about what abilities a claimant has and what support might enable them to move towards work immediately after they have undergone the PCA interview, which focuses on what they are unable to do because of their disability or health condition, is potentially confusing and a cause of anxiety amongst claimants.

Disabled people have spoken to us most movingly of their desire to work, but also the pressure they feel themselves under at the prospect of being faced with these two contrasting assessments. After all, how are they to know that what they say when discussing their abilities could not be used to further inform whether they pass the personal capability assessment? At the very least, there is a tension between the objectives of the two assessments. Without knowing the rates at which benefit will ultimately be paid, it is impossible to say that there is not a disincentive for claimants to embrace wholeheartedly the idea of work-related activity which will operate at the point of the work-focused health-related assessment.

In another place, the Minister for Employment and Welfare Reform undertook to reflect further on the timing of the personal capability assessment and work-focused health-related assessment interviews. I would be grateful if the Minister could tell us whether he and his colleagues have had an opportunity to look again at the concerns expressed and at the possibility of increasing the time gap between the two assessments, with a view to reducing the potential for anxiety and confusion among claimants about the intentions of his department. I am sure the Minister would agree about the need to do everything possible to bolster claimants' confidence in the process if we are to get the best out of it.

The Government have set themselves an ambitious aspiration of getting 1 million disabled people off incapacity benefit and into work over the next 10 years. This is a laudable aim, but one concern I have is that the Bill does not introduce specific measures to help people who are at risk of leaving work due to a disability or health condition. It is estimated that, just in relation to people who experience sight loss, 3,000 leave work each year because they feel unable to continue in work, with more than 25,000 people in total leaving the labour force each year as a result of work-related injury and illness. Enabling such people to remain in work could do more to get people off benefit and into work than any measures designed to get people into work in the first place.

The Disability Rights Commission’s code of practice on employment mentions reasonable adjustments that employers should consider to retain disabled staff. However, this code is not legally binding, and it has been argued that employers should be legally obliged to implement better employment retention policies and practices in order to retain disabled staff. The Minister may have heard of proposals made by the voluntary sector, trades unions and others to tackle this problem through the concept of disability or rehabilitation leave. Indeed, a Bill was introduced in another place during the last Session of Parliament designed to create just such a system to enable those who become disabled while at work to undergo a period of retraining or rehabilitation without losing their job. I was pleased that his party, in the Warwick agreement, committed the Government to take action in this area during this Parliament, and that the Labour Party's 2004 party conference report from its National Policy Forum stated that the party would go further to promote full civil rights for all disabled people, including:

“Taking action to ensure that employers fulfil the requirement already on them to make reasonable adjustments for disabled workers including where appropriate granting leave in respect of their disability and permission to phase a return to work without fear of losing their employment or livelihood”.

I hope that the Minister will be able to respond positively on this point and indicate the measures that the Government are considering to meet this commitment and ensure that people who become disabled, or who develop a health condition while in work, are given the support they need for rehabilitation and retraining to remain in work. After all, as the Minister reminded us, someone who has been out of work for a year has only a one in five chance of being in work after five years, and those who are out of work for two years are unlikely ever to find work again. I am sure the Minister would agree that it is far preferable to enable a disabled person to stay in work than it is to have them leave their job, claim incapacity benefit and have to make their way back towards the labour market.

There is one other issue that I would like to raise on Clause 15, and that is the nature of the employment-related support that will be provided by contractors to disabled people on the work-related activity component of employment and support allowance and to those from the support group who choose to volunteer to underatke work-related activity. The evidence of the Pathways pilots is that people with mental health and muscular skeletal problems have been the main focus of support activity, with their combined numbers representing around 1.4 million of the 2.7 million current claimants of incapacity benefit or severe disablement allowance.

It is important, however, that we do not concentrate on those very large groups to the exclusion of other, smaller groups of disabled people who face significant challenges in finding and retaining work. I particularly have in mind visually impaired people, who, as I mentioned earlier, experience a rate of unemployment much beyond that of the average for disabled people. My concern is that, in looking at the large numbers who can be helped, we do not forget those smaller groups of disabled people who may be further away from the open labour market, and who may need long-term and well tailored support to move towards work.

I hope that, in awarding the contracts for delivering employment support, the Minister and his colleagues will consider carefully whether bids adequately set out how they will meet the needs of smaller groups of disabled people and those with high support needs. It would be a great pity if these reforms led to employment support providers helping only those disabled people nearest the labour market to the detriment of disabled people with greater needs, who will require more help and support to enable them to move towards work.

My Lords, back in 1997, those of us campaigning for the poor usually did so by campaigning for higher benefits, until one calculated that if one raised every benefit by about £10 a week—which would have bought a couple of yoghurts a day and a cinema ticket at the end of the week—that would have equated to the entire spending then on the hospital service, and people would still be poor. They would still passively receive the dole, generation after generation. Since 1997, a dozen or so social security Bills later, we have instead been building up an active concept of welfare that is focused on work, to address not just income poverty but, as has been movingly said by other contributors today, the poverty of self-esteem of those on, and who regard themselves as being on, the edges of our society.

We have come a long way since 1997. Under a remarkable Chancellor, we have seen a steady and expanding economy, with another 2.5 million jobs. We have seen those jobs pay, through a minimum wage, tax credits and childcare support. We also know, though, that labour market policies are essential as well. We know that if youngsters leaving school at 16 have not had a job by 21, they will have become virtually unemployable, and that someone on disability benefit spends their first 12 months anxious to get back to work and subsequent years anxious to remain unthreatened while they remain on benefits. We know that the lone parent who stays on income support until their youngest child is 16 moves at that point not back into work, as we would hope, but almost always on to another benefit.

Those labour market policies are the subject of the Bill. For those who have been active—the problem now for all of us is inactivity, not unemployment—the labour market seems full of risk. It is about those risks that I want to talk tonight. Some have already been mentioned. Pressed to enter, many economically inactive people will become reluctant conscripts, engaging, I fear, with reluctant employers.

What are those risks, and to what extent does the Bill seek to address them? The first cluster of risks are the benefit traps. I shall touch on some of them. We know that the best predictor of whether, for example, a lone parent has a job this year is whether last year they had a mini-job. Yet, if she takes a mini-job, we punish her for it. Every hour she works after three hours, until she hits 16 hours, she loses her benefit 100 per cent, pound for pound. Surely that is not sensible. It is an invitation to build fraud into the system.

We need dials, not dichotomies. We need a properly tapered earnings disregard—in the same way, I suggest, we also need a review of the permitted earnings rule for disabled people—if we are to coax the inactive back into the labour market so that their confidence grows step by step. Even worse, when people find work, they face a steep withdrawal of housing benefit and a tax of 60p in the pound on top of all their other taxes, and then if the job folds it will take them weeks to get back on to housing benefit, so that to the financial risk of losing a job and means-testing is added the potential risk of homelessness.

The four-week rollover helps, but it is still not enough. I hope that the Bill’s new housing allowance offers the possibility not only of shopping around—although I remain somewhat sceptical of that, given that something like 40 per cent of those on housing benefit have to use their benefit to top up an incomplete and inadequate housing benefit because of the recalcitrance in many areas of rent officers—but maybe of housing choice. More importantly, as my noble friend said in his opening speech, it will allow predictability, speed and simplicity.

We have also, with the best of intentions, built another risk into disability benefits. Incapacity benefit increases in value the longer you are on it. There are perfectly good reasons for that: over time you need to replace white goods, carpets and so on, which a person on JSA—80 per cent come off it within six months—would never normally need to do. However, that seems to produce a reward for not coming off the benefit. More importantly, it produces a high perceived risk that, if you come off the benefit and then your health or your job collapses, you go down the snake of benefit reduction and have to start all over again at the lowest rate.

That is why over recent years we have extended the linking periods—up to two years now, I believe—to absorb that very real risk, and why I am so pleased that those in the support group in the Bill will get a higher rate within 13 weeks, not 26, while any false incentive for those who might work not to do so is removed. We know that means-testing encourages fraud. It also multiplies the risk of error. Again, the simplification of benefits in the Bill and the sharing of information, as well as the firm line on fraud, will, I hope, diminish those risks. So there is a cluster of risks around the structure of benefits and its income-related forms.

The second set of risks I want to suggest tonight are around the work-focused interviews. Many benefit recipients have become economically inactive for good reasons—poor physical and mental health, functional illiteracy, weak language skills or exhausting caring responsibilities—and may end up without a qualification, a skill, a driving licence or a reference to their name. Work they might have attempted in the past—the classic job was always that of lift attendant—has been increasingly squeezed out of the economy. Many are a long way away from today’s world of work. We could invest many pounds and many hours, and they would still not find work. Under any value-for-money scenario that is going to be troublesome, but try we must.

If the funding for outsourced contracts rewards outcome-based results, however, how much work will go into supporting and sustaining such people when other clients are easier and quicker to place? Can we hope that my noble friend will be able to assure us that more generous support funding will be put in place? Even if, with all this additional work, someone is not helped back into the labour market, they may none the less in the process have been able to become a better parent and a better member of society, able perhaps to do part-time work or volunteer.

New Deals have been transforming here. I am delighted that Pathways to Work will be rolled out nationwide over the next 18 months or so. The IFS has shown that it is beneficial for the older worker, that the New Deal for the over-50s has supported something like 160,000 people back into work since 2000, and that of those on incapacity benefit nearly 10 per cent more are in work nearly 12 months after Pathways—a significant finding.

We are right to concentrate on those entering IB before they have become dependent on their benefits and while they are still attached to the labour market. If there is one thing I have learnt about disability benefits, it is that early intervention is vital. But, as another noble Lord has said tonight, our record on occupational rehabilitation is among the poorest in Europe, and that has to be improved. It is much easier to hold someone in work than to bring them back into work a year or two down the line.

That brings me to the next risk, which has also already been mentioned. I refer to conditionality, compulsory work-focused interviews, the sanctioning of benefits, and the like. Unlike other noble Lords, including the noble Baroness, Lady Thomas, I think it is essential. In the early New Deals we quickly found that what was not mandatory was too often ignored.

Each time the Government introduced sanctions in social security, worries were rightly expressed about the quality of staff and their decision-making. The fear was that too many people would be sanctioned. Would staff understand the effects of cancer treatment, dyslexia, of having a sick child or of agoraphobia? As evidence that staff do not understand, it has often been said, and it has been repeated tonight, that half of all IB refusals were overturned on appeal. That fear was expressed tonight by the noble Lord, Lord Oakeshott. I believe this to be a misunderstanding.

Although most New Deal programmes deal with thousands of people, the number of sanctions in most of them can be counted on the fingers of a couple of hands. In my experience, staff are almost entirely sensible and decent about missed interviews for health reasons, caring crises and the like. They are not traffic wardens, rewarded for the number of benefits they refuse or sanctions they impose. We should not assume that that is what they are there to do.

The point about conditionality is that people do not know what they do not know. If they do not attend work-focused interviews, they will not know about the possibility of rehab, of job search techniques, practical help with aids and appliances, such as the access to work programmes, and the effect on family finances. After all, one person in six who is on IB has dependent children. Perhaps two-thirds of those coming on to IB will be in the support group, and of the third in the employment group, perhaps a third of those will be screened out to join the support group, but if we can reduce those risks, many of those in the support group may want to try to return to work, even if only on a part-time basis.

As for those going to appeal—often used as evidence that the staff have got it wrong—perhaps 50 per cent to 60 per cent of DLA appeals are overturned, which is about 5 per cent of the total IB caseload. As the president of the appeals tribunal has indicated, appeals are usually overturned on the basis of incomplete evidence, the problems of a fluctuating condition—very difficult for any decision-making—and, sadly, a deteriorating condition. What is key is to get it right as far as humanly possible at the early decision-making stages and to review that decision as new and more complete information becomes available before moving into the tribunal system.

This brings me to my final risk: the attitude of the employer, especially those in small and medium-sized enterprises, mentioned by the noble Lords, Lord Skelmersdale and Lord Oakeshott. Employers, particularly SMEs, understandably want hassle-free, reliable staff. They cannot easily cover unexpected absences—the woman with the disabled child, for example—and they dread entanglement in the tribunal system. Some 38 per cent of employers are unwilling to employ a disabled person and two-thirds are unwilling to employ someone with a mental health problem, yet 40 per cent of those on IB have a mental health problem or a learning disability. What can employers respond to when someone has fluctuating mental health or if they are presented with someone who has Asperger’s syndrome and may have weak social skills? The Richmond community owns jobs collectively—with Boots, say—and the job gets done by someone in the commune. That seems a very positive way forward. Mentoring has had superb results, but we must think outside the box more than we have conventionally done.

We know that the best hope of employment for someone with a disability lies with re-employment by the previous employer, who sees beyond the medical record to the person they knew before. I wonder whether we were wise to abandon the employment credit for employers. Can we give greater help to those former employers, as they are the ones most likely to hang on in and make the job sustainable?

We have come a long way: there are 2.5 million more people in work and 1 million fewer on benefits, while 2 million pensioners and 2 million children have been lifted out of poverty. I greatly welcome the Bill and am confident that my noble friend will give us the assurances that we seek. If we can get it right, I believe that it will offer renewed life chances that could be transforming for those too easily written off in the past.

My Lords, it is a great privilege and pleasure to follow the noble Baroness, Lady Hollis. Her experience in the department has stood her in good stead; she is an expert in these matters, and her penetrating and skilful analysis, particularly of the risks involved in this piece of policy-making, is essential to its success and will repay careful study.

I should like to detain the House for a moment on the politics of the measure. I absolutely agree that active labour markets and the policy of having work for those who can and security for those who cannot were perfectly reasonable, sensible and beneficial policy changes that came in after 1997. Call me old-fashioned, but I imbibed with my mother’s milk the idea of the social insurance principle. People paid in and, during periods of adversity throughout their life, they got help from the state.

After 1997, the Labour Government moved subtly away from that. There may have been good reasons, but it was done quietly, and I do not think that there was enough debate. I was perfectly happy to make the best of “work for those who can and support for those who cannot”, but there is some evidence that the ground is shifting yet again, and we should be careful about that. Only a few days ago, Mr Murphy, the Minister of State at the department, made an important speech—important enough to go on the departmental website—which moved away from the adage of “work for those who can, support for those who cannot” to “work first, benefits second”. I am not a conspiracy theorist, but that makes me deeply suspicious. If he is setting out a change in the thrust behind these policy measures, we may be moving into territory where people have to go on to a programme or a job or undertake some sort of training before they get any benefit at all.

I will be pleased to be told by the Minister or somebody that I am overthinking this, but, if that kind of philosophy is adopted, when the Bill— support it as I do—is eventually implemented, the environment could be very different. I hope that in the course of this evening’s debate and in Committee we can clarify whether a new dimension and a new perspective are being brought to the philosophy that underwrites some of the policy.

As has been said by other people—indeed, it is the only thing about which I disagreed with the noble Baroness, Lady Hollis—conditionality is deeply worrying. Administrative systems of that kind are contrary to natural justice, have unintended consequences and result in a degree of complexity from which we are already suffering too much. Bills of this kind should always have a simplification clause, as standard. There are some simplifications in the housing benefit aspects of the legislation, which are welcome, but not much else. I hear that the department is now thinking of predictive data techniques to speed up benefit claims, but there is a world of difference between having techniques to manage complexity and getting a simpler system in the first place. There should be a rolling programme of simplification measures, and the Bill does not have enough of them.

The role of the private sector will be distinctly different in the implementation of the legislation, and I am particularly interested in the Minister’s view of what Sir John Freud will bring to that agenda, because I hear that he takes the view that private sector companies could easily enter the field and increase efficiencies in the roll-out of the administration. I hope that the Minister will advise Sir John to go and talk to the managing director of Capita, who had some very inelegant experiences administering housing benefit systems for some of the London boroughs in the not too distant past.

The department is in pretty bad shape right now. It is an excellent department, and the professional staff are all admirable people, but it has suffered from a series of circumstances that cannot be ignored if we expect success in the deployment of this policy. The Gershon efficiency savings are taking a toll. The absence and sickness rate in the department itself—rehabilitation systems and processes—is terrible, and the departmental record in absence management has been chronically bad for a long time. In addition, the department faces a 5 per cent efficiency saving cut, which is being worked on now. At the same time, the Comprehensive Spending Review to be completed later this year will take effect but will probably not make things any better. The frequent changes at Secretary of State level, with six Secretaries of State in the past 10 years, have led to incoherence. The department has suffered in that regard, and we have to take all that into account.

Staff morale at all levels in the department is low, particularly at a local level. In my area of south-east Scotland, the former integrated local office based in Galashiels, with 45 to 50 loyal, professional and high-quality staff, is being replaced by a supermarket—it is now a branch of Tesco. The staff are being relocated to new offices and being given no assurances at all about long-term established work, so they are finding other work because they are able people at the end of their tether. That background cannot be ignored when we are making policy changes of the kind that are contained in the Bill. There is a series of operational factors that the department must address. We look forward to going through those systematically in Committee.

I have been scarred by my own experience, and I have no alibi, because I was there when we debated the initial legislation on child support in 1991. The noble Baroness, Lady Hollis, spent most of her departmental career trying to fix the mess. It was not her fault that the thing got into such a fankle, to use one of my granny’s favourite Scottish words.

The combination of two things concerns me. First, the House may know that the DWP abandoned the benefits processing repayment programme last year. Noble Lords may not know that that was a fundamentally important set of processes that underpinned the new employment allowance that this legislation introduces. The department’s investment strategy programme, published for the years 2005-08, declared that the BPRP was,

“a core Information Technology Platform which will provide a lasting foundation for modern, flexible IT solutions which support business priorities, including improved service for customers and employers, reducing the operating costs of legacy systems, efficiency savings and improved programme protection”.

According to the press, the Government wrote off £141 million as a result of the abandonment of that programme. The good news, as, I am sure, the House would like to know, is that those who administer Jobcentre Plus believe that only £70 million was lost because some of the work can be recycled and salvaged. I hope that it can.

That measure underpins the roll-out of the IT platform in Part 1 of the Bill. Almost simultaneously with that measure, the department asked for a Section 82 power, under the Welfare Reform and Pensions Act 1999, to spend in advance of Royal Assent. As the House probably knows, the department is, unusually, spending money already on this IT platform before Royal Assent—there are powers to do that, and it has gone through in the other place. I cannot but think that those two things are connected. The last time that the Section 82 power was used was to bring forward an IT platform for the CSA, so the auguries are not necessarily good.

Was the timing of those two things consequential on one another? Was the Section 82 consent asked for because the benefits processing repayment programme was abandoned? If that is the case, I wonder whether the 22-month programme that was set in place by the Section 82 consent, which has been three months in gestation since the authority was given, is realistic. We have been here before with other IT platform programmes. It is a politically driven programme, and it is far too challenging. If it does not work, does A-day still happen on 1 April 2008, or does it move to November 2008? When it happens, what does “up and running” mean? Does it mean that the platform will be available to every front-line adviser on the day when the scheme is rolled out? Now that Jobcentre Plus has had that extra time since it got the consent for the spend under Section 82, can the Minister say whether the spend is up to programme or is it slipping further behind?

The department estimates that it has foregone “only” £70 million of the BPRP. Is there anything that can be salvaged from the remaining £70 million? I would dearly like to know whether efforts are being made in that regard. The department said that it was going to put a plan into effect to ensure that the most was made of the salvaged elements to deal with the legacy systems. Will the Minister undertake to share with us in Committee the details involving the underpinning IT provisions and operational platform for this new, important allowance? My experience suggests that, if he does not, the whole house of cards could tumble down because of operational difficulties because the computers do not work. If that happens this time, it will be a tragedy, and there will be no excuse, because Ministers could not say that they were not warned.

My Lords, I shall concentrate on two areas covered by this important Bill. The first, as the noble Baroness, Lady Hollis, mentioned, is the area of permitted work rules for disabled people. Secondly, I want to touch on the situation for older workers.

The objective of the Bill is a welcome one: to help large numbers of disabled people in moving towards work. With that objective in mind, I wish to raise an issue around the impact that proposals in the Bill will have on the ability of people claiming incapacity for work benefits to undertake permitted work. Currently, people claiming incapacity benefit or severe disablement allowance are able to undertake a limited number of hours of paid work each week to help them gain work experience and remain in touch with the labour market. They are also able to volunteer for an unrestricted number of hours. Those rules form an important means for disabled people on benefits to try out work without any threat to their benefit entitlements, which for many people is a source of great anxiety, having often been through long and complicated processes to secure those benefits.

The permitted work rules changed on 10 April last year. A new category of permitted work was created for people who were exempt from the personal capability assessment, which establishes entitlement for incapacity benefit. People in this group are able to work for less than 16 hours a week, on average, and earn up to £81 each week without having an impact on their benefit entitlements. However, as part of this Bill, a review of the personal capability assessment has been conducted, and it is proposed that the exemption from the assessment for certain groups of disabled people is to be ended. While that has been welcomed in the sense that it means that these groups of disabled people will no longer be automatically regarded as unable to work and therefore included in the additional help that will be offered under the Bill, it is unclear what will happen to claimants who are undertaking permitted work under these provisions when employment and support allowance is introduced in late 2008.

I should be grateful if the Minister could clarify the Government’s intentions regarding how the introduction of employment and support allowance will impact on people who are at that time undertaking permitted work on the grounds of being exempt from the personal capability assessment. Perhaps he could also let your Lordships’ House know what plans his department has to provide claimants with information about how people who are currently exempt from the PCA and who are undertaking permitted work without a time limit will be dealt with when employment and support allowance is introduced and the exempt group abolished. I ask because the current systems can be confusing, and benefit claimants face difficulties in understanding what sort of work they can undertake, how it will affect their benefit entitlement, and what can happen as they move between benefits and employment. Indeed, if as part of the Bill we can move towards improving the clarity of information for benefit claimants to assist them to understand the opportunities and responsibilities around undertaking work while claiming benefit, that would be a welcome achievement.

We must acknowledge that an older workforce will mean more people with acquired disabilities. The Government need to ensure that they strike the right balance between prescriptiveness and entitlement. Incapacity benefit is a contributory benefit, so recipients have a stake in the system and are not asking for hand-outs. Often, they will have worked for a substantial amount of their life. Any health conditions affecting their ability to work may even be workplace-derived. I am pleased that the Government acknowledge that early intervention is essential to stop the rot and prevent long-term dependency. Forty per cent of unemployed people over 50 have both health and skill limitations. However, I fear that, if the work-related activities are too restrictive, the reforms will fail. We need maximum flexibility to capitalise on individual circumstances, education, training and life commitments such as family and care. We should remember too that older workers may need or wish part-time work, and the reforms must accommodate that.

It is regrettable that funds have been withdrawn for education and training in later life. One-third of those in their early 40s do not have five GCSEs or equivalent, so the problem is more systemic than just an incapacity benefit bill for the over-50s. Those in the pipeline, as it were, are already building up the same problems. That needs attention.

The Minister acknowledged in June last year that there was a lot of resistance from employers to employing older people, as we have heard. The Government must take the lead and campaign to enable employers to understand the benefits of employing older people: the experience and loyalty that they bring to a company and the saving on recruitment costs, as older workers tend to stay in their jobs for much longer than younger ones.

Finally, the reductions in incapacity benefit if occupational pensions reach above £85 are worrying. Incapacity benefit is then reduced at 50p per pound. The Government said in 1999 that that would be reviewed annually to ensure that pension value was not eroded, but the figure is still £85, and there is no public evidence of it being reviewed. Will the Minister give a commitment that the figure will be uprated to take account of inflation?

I look forward to hearing what the Minister has to say on these important issues.

My Lords, I want to add one or two further points to those already made by your Lordships on Part 2 on housing benefit. This is a subject of such complexity and, dare I say it, for those not directly affected, of such tedium, that it has defied reform and improvement for many years. I congratulate the Government on working up a revised housing benefit scheme with a new simpler system for calculating benefit—the local housing allowance scheme.

Over the past five years I have chaired a housing benefit reform group with representation from landlord and tenant bodies and from government departments, which has followed the progress of the new measures. In this instance the pathfinder schemes in pilot local authority areas have been the subject of impressive evaluation for the Government, not least at the University of York. This has involved a thorough appraisal of the concept and has shown that it is sensible to roll out the arrangements from the initial 18 areas to all local authority areas.

The scheme involves greater clarity and simplicity and will make the administration of housing benefit, which, frankly, has been a nightmare for the 408 local authorities handling housing benefit as well as for both landlords and tenants, infinitely better. However, perhaps unsurprisingly, the new arrangements are not perfect. The worst aspect of the current housing benefit regime is that many tenants have to pay out more in rent than they receive in benefit. This means that the tenant must cover the balance from their other income. But income support and other benefits do not have any leeway to pay the rent. Other benefits are calculated on the assumption that housing costs are fully covered.

The new regime has led to smaller shortfalls in many cases, which is of considerable importance, but shortfalls remain in many other cases. The Catholic Housing Aid Society in Kirklees carried out a survey of 37 landlords with 2,756 properties and found that the people who had a benefit shortfall went without meals on a regular basis: 50 per cent missed three main meals a week; 50 per cent were behind with other bills, and 15 per cent faced court action for debt; 50 per cent were behind with their rent, unsurprisingly, and 20 per cent faced eviction as a result. Why the shortfall, the gap, between the rent and the housing benefit intended to cover it? It occurs because the rent officer sets a rent level which is lower than the landlord charges the tenant. The new system involves rent officers setting the rates for the flat-rate local housing allowances. The problems of fixing maximum levels, which in many cases leave tenants trying to make up the balance, need to be minimised.

A problem can arise if the geographical area covered by the so-called broad rental market areas includes such an unbalanced portfolio of properties of different prices that the median rent is too low in relation to the actual availability of properties for rent. The boundaries for these broad rental market areas need an input from the local authority and its own housing experts. At the moment the rent officer service is quite separate and independent of the local authority. It also seems important for there to be a system of appeal against rent officers’ decisions—an external, independent appeal mechanism, not just the unwieldy processes of judicial review. The existing rent assessment committees might perform this function.

More technically, there is an intention to move from the use of the mean rent in the calculation to the median rent. I am advised by Professor Steve Wilcox, acting for Citizens Advice, that this innocuous-sounding change could mean a lower level of maximum housing benefit for all concerned. Will the Minister look at this technical issue and see whether his officials can do some sums in advance of implementing it, just in case this advice is correct and we are unwittingly coming up with a formula that will mean more of these dreaded shortfalls?

A specific aspect of rent-setting which has caused particular controversy is the single room rent for under-25 year-olds. This caps housing benefit at a level deemed to cover the rent of a room in a shared home, not a self-contained flat for these tenants. The Minister referred to this in his opening remarks. The requirement is now to be called the “shared room rate”. The Minister pointed out that a large number—I think that the figure is 40 per cent—of younger people who pay their own rent live in shared accommodation. Is it fair, goes the argument, to seek a self-contained flat if you are on housing benefit when those who are not on benefit often must share their house or flat? This misunderstands the realities facing many young people who need accommodation in the real market place. Life is quite different for vulnerable, ex-homeless young people—people coming out of prison; people moving from a hostel or supported accommodation into their first home—from what it is for young, upwardly mobile young people, down from university, or students who share, and enjoy sharing, perhaps with help from their parents.

There are many areas in which there are practically no shared apartments on the market for that young person to go out and find. Houses in multiple occupation are closing in a number of places—there are fewer of them than there were. The huge phenomenon of buy-to-let, with lots of new landlords coming into the market place, is entirely in self-contained accommodation: one-bedroom and two-bedroom flats.

The Department for Work and Pensions has discovered that the average shortfall for young people in these circumstances is £35 per week. This is a very large sum of money to find if you really do not have any other source of income to sustain you. You have your income support to cover your food, your fuel and your clothing; there is nothing left to contribute to your rent. So, very soon, these young people, who are not able to move into shared accommodation, will find themselves, as they have in the past, in serious difficulty. The YMCA, Crisis, Centrepoint and Shelter have all sent us evidence on the problems which the old single-room rent, which is to be perpetuated in the new system, has caused for young people in these circumstances. I hope that the Minister will be able to offer some reassurance that this real defect in the old, and now in the new, housing benefit scheme will be remedied.

My Lords, I am grateful to my noble friend Lord Morris of Manchester for his contribution not only to this debate but to the debate in 1969 on the Chronically Sick and Disabled Persons Act, to which he referred. He was much too modest to repeat his profound contribution to that debate. Movingly, he said,

“if years cannot be added to the lives of the chronically sick, at least life can be added to their years”.—[Official Report, Commons, 5/12/69; col. 1863.]

I quote my noble friend because it is sometimes said that the values of a society can be judged by the standard of its welfare system. While there are limits to that statement, it is true that the welfare system can define a society. Welfare defines our common humanity. It defines our collective compassion and our sense of social justice, and, for some of us, it defines our moral compass. How we treat our retired citizens, our pensioners, our children and those with disabilities can say much about what kind of society we are.

To date, the Government’s strategy has been one of empowerment, directed, rightly, at getting people from welfare to work. This must be welcomed. Yet, only half of Britain’s disabled people of working age are employed. Those who have been on incapacity benefit for more than two years are more likely to die or retire than ever to get back into work. So we certainly need reform of the system.

Sadly, the history of previous reforms has been underpinned by a culture of sanction and even fear. But let us be very clear: no one will argue against reform of the incapacity benefit regime. No one will argue against the crackdown on benefit fraud. The better co-ordination of the housing benefit regime is just one of many worthy objectives that the Bill seeks to address.

However, it is essential that the Bill sets the right tone of incentive and support. The measures in the Bill must therefore tackle employers’ prejudice against those with disability; it must enable and empower those who can work to do just that; it must ensure that those who are deemed unfit to work receive the support and decent benefits that they deserve; and it must crack down on fraud in the benefits system. However, for these reforms to be successful, it is vital that the many fault lines caused by the complexity of the benefits system are addressed.

We all recognise the scale of the task which faces the Department for Work and Pensions. It pays out more than £100 billion in benefits every year. It processes more than 60 million cheques per month. It handles more than 200,000 appeals per year against benefit decisions. Thirty million people in the United Kingdom receive income from at least one pension or benefit department. That is a huge task.

It is therefore self-evident that it is not possible to satisfy every claim from every individual, but do we really need the multiplicity of benefits that is highlighted in the report on complexity of benefits by the National Audit Office in November 2005? I am confident that this Bill will add to the complexity.

Sadly, due to the complexity of the system, the people who need the benefits most understand it least. When staff at the sharp end of the system have to ring up the citizens advice bureau or the Family Welfare Association for advice on and interpretation of the regulations, we are all in trouble.

Delivery is a crucial part of the benefits system. Yet the 2005-06 Social Security Advisory Committee’s report drew attention to the difficulties that many claimants will face following the termination of the Post Office card account system in 2010. In addition, the current round of Post Office closures will cause real hardship to claimants, particularly senior citizens who are not mobile and those who live in rural areas.

Finally, on the culture of the Bill, it is short on principles on the face of it—there are just three or four key ones—and limited in details. It is essentially an enabling Bill in many instances, as the Explanatory Notes say. The key objectives will in reality be delivered by a framework of rules and secondary regulations. I have no doubt that this House will pay as much attention to the secondary regulations as to the Bill, because reform of the benefits system is a matter of fundamental importance, requiring rigorous legislative scrutiny for the details and primary provision. In conclusion, the Bill should be about welfare, not work fear.

My Lords, I shall address my comments to the Bill’s mental health aspects. They have already been well addressed by other noble Lords, so I can cut down considerably on what I was going to say; many of the facts and figures have been ably addressed by the noble Lord, Lord Low, and others.

Paid work gives people with mental health problems tangible evidence of their own value, improves self-esteem and can give them a sense of mastery over their lives. I welcome the Bill, in building on the Pathways to Work pilots, while pointing out that early evidence suggests that people with a mental illness have been less successfully helped back into work than those with physical health problems.

The Bill raises some practical issues. As the noble Lord, Lord Morris of Handsworth, has just said, one of the Bill’s problems is that the devil will be in the detail of the regulations. I may therefore be raising issues to be addressed in regulations; if so, I hope that the Minister will bear with me for the moment.

The accuracy and appropriateness of the revised personal capability assessment (PCA) is clearly crucial. The revised version is a big improvement for people with mental health and learning disabilities. However, we know that, when implemented across many hundreds of thousands of people, the sensitivity and skill with which these assessments are carried out might in practice be less than perfect. We must ensure that staff are better trained to understand fluctuations in mental state, difficulties in social interaction and the importance of taking time. As mentioned by the noble Baroness, Lady Hollis, staff often want support and have a good approach to it, but not the knowledge or skill to apply it properly. The personal capability assessments can therefore be applied incorrectly.

Given the pivotal role played by the PCA and the concerns about the review process, I add my voice to those who believe that there should be long-term government monitoring of the new PCA. When conducting the PCA, medical assessors from Atos Origin are guided through the issues to be covered by the computerised questionnaire known as LiMA (logic integrated medical assessment), which the noble Baroness, Lady Thomas, described so accurately in her vignette. As they go through an assessment, the doctor records claimants’ responses by selecting pre-coded options suggested by the LiMA system. In the main, the final assessment report is made up of a series of selected pre-coded responses.

I am perhaps referring to a period before Atos Origin took over this contract, but given the lamentable knowledge and skills about mental health issues frequently demonstrated by medical assessors, we might be better off trusting a computer program. However, for accuracy it unfortunately still requires high-quality input and sensitivity from the doctor. On average, the process takes 45 minutes and is completed in a one-off snap-shot assessment. What must be addressed is the quality of decisions currently being made. It is interesting that, in spite of the promised objectivity of these “mouse-driven medicals” as they are called, appeal after appeal—over 70 per cent—still says “No” to computer-generated reports and “Yes” to the claimant. Something is not right here. How we implement this may be important.

Requests for access to LiMA have been turned down, I understand, because it is exempt from disclosure under freedom of information legislation, as that might threaten the commercial interests of Atos Origin. It seems extraordinary that such an important tool should not be available for parliamentary or public scrutiny. Can that be correct? I was surprised to be informed of this by organisations. Can the Minister confirm why we cannot scrutinise it and judge whether it is an appropriate tool? At present, the great majority of appeals against decisions are successful, indicating that gate-keeping is poor. There should be regular customer surveys about the PCA process to ensure that it is fair, credible and can be continuously improved.

Under the current system, many people find themselves subject to a PCA once they begin to take steps to work, such as volunteering or educational activity. For people on the support component of ESA in particular, fear of an untimely PCA could become a barrier to participation in such activities, leaving them in the benefits trap. The regulations will provide an opportunity to stipulate when and in what circumstances a PCA can occur. That would give people on ESA greater trust in the system and more security to take the necessary steps towards employment. I recognise that, in Pathways to Work areas, many personal advisers ensure that customers taking steps to work are not penalised by an unexpected PCA. The regulations should ensure that this becomes standard practice in all areas.

Individuals applying for employment and support allowance will be required, as we have heard, to undergo both a PCA and a work-focused, health-related assessment at the same time or sequentially, with a doctor who is not necessarily qualified to assess work capabilities and rehabilitation needs. That is a serious concern. The PCA is a means of determining whether a person is eligible for one or other component of the benefit, while the WFHA is a further test of,

“the extent to which a person still has capability for work”,

and whether it,

“may be improved by the taking of steps in relation to his physical or mental condition”.

Combining the two assessments risks confusing both the assessor and the claimants, and could sow mistrust between claimants and their personal advisers. Health professionals trained to determine a person’s ability to work or undertake work-related activity are not necessarily best placed to assess a person’s vocational rehabilitation training needs. We need to learn more about how people will be trained to administer these two related assessments; it is by no means clear.

The Bill goes further than the Green Paper in extending the use of sanctions. They have been extended to cover attending a work-focused, health-related assessment and undertaking work-related activity. There is no evidence that sanctions are necessary to achieve the welfare reform objectives, and it is not clear why the use of sanctions has been extended and how they will work in practice. For people with a serious mental illness, further sanctions would add a fear factor in the system which will be counterproductive. I do not believe that it is desirable for sanctions to be extended to cover health-related assessment and work-related activity, nor am I confidant that the skills and knowledge of DWP staff can ensure that sanctions are fairly applied. However rarely they may be applied in practice, in reality everyone will know about them and have an instinctive fear of them.

People with a mental illness usually want to work, and it is a tragedy that three-quarters of all adults with schizophrenia in this country have no employment; indeed, many employers say that they would not employ them under any circumstances. Yet, we know that no adaptations have to be made to employ patients who suffer from schizophrenia and that many such people are employed and have useful and constructive lives which, with support, many more could enjoy. If the reforms do not work for people with serious mental illness, the policy will fail. I look forward to hearing more on the Government’s plans for implementing these reforms, through the regulations, for the benefit of people with mental health problems.

My Lords, this Bill seems to have been an awfully long time on the way, so to speak, but I am as pleased as the Minister that it is here at last. A few points give me concern. I hope that they will be clarified by the Minister at this stage—or, perhaps, he can write to me, because I have many questions—and that we will be able to improve the Bill during its passage through this House.

For many years, I have been concerned about the manner in which claims for incapacity benefits from people with a diagnosis of CFS/ME, fibromyalgia, organophosphate poisoning, multiple chemical sensitivities and other diseases that are multi-symptomatic and difficult to define have been dealt with by the Benefits Agency. Despite an enormous amount of peer-reviewed scientific evidence from researchers and clinicians from all over the world, the view persists in this country that they are psychosocial behavioural problems and that there is no need to look too closely at causation or for biological signs of organic illness.

Recently, I have been a member of a panel, led by Dr Ian Gibson MP, which inquired into the current state of research into CFS/ME in the UK. We heard evidence from many sources, perhaps the most distressing of which was from sufferers of CFS/ME who were severely ill and who had been sidelined by the social security system because nobody would believe that their illness was real. Such people are usually bed-ridden, often living alone and isolated from the community, and the aids that they need are unattainable. We were told that that had resulted in at least one death and several suicides. This is a welfare reform Bill. I do hope that the reforms made will take into account the seriousness of an illness that far too many men, women and young people in this country suffer, and that will offer them the security of knowing that at least the most basic of their needs will be provided for.

I will confine myself to Clauses 8 to 15. I am most concerned about the very large number, at least 27, of applications of the Henry VIII clauses, which will make it extremely difficult for either House to reject major secondary legislation that will affect the lives of many disadvantaged citizens. As the noble Baroness, Lady Thomas of Winchester, said so strongly, and as stated often in this House, that is not a satisfactory way to legislate.

Experience has taught me that, unless those responsible for the examinations are sympathetic, it is very likely that claimants suffering from the illnesses that I have listed will be given short shrift. I have written frequently to the Minister’s predecessors and have challenged them at the Dispatch Box—that includes the noble Baroness, Lady Hollis, who I am pleased to see in her seat, the noble Lord, Lord Hunt of Kings Heath, and even the noble Lord, Lord Skelmersdale, who resisted pulling my leg this evening. Inevitably, original decisions on claims have been overturned. I cannot immediately recall the proportion of refusals overturned on appeal, but my noble friend Lady Murphy said that the figure was 70 per cent, a huge figure. It leads to an enormous amount of stress for claimants and is a huge waste of public money. If the new system can be rationalised to reduce both those factors, I, for one, will be delighted. It grieves me that I receive many communications from frightened and anxious people or their carers.

Clause 8(2)(b) states that regulations will,

“define the assessment … [of] the extent to which a person who has some specific disease or bodily or mental disablement is capable or incapable of performing such activities as may be prescribed”.

Most of the illnesses that I have mentioned involve symptoms that fluctuate in severity and duration. Some sufferers get better, others do not. It is known that claimants will prepare themselves for an interview or medical examination by resting beforehand, and it may be that they perform well at the time. However, it is extremely likely that they will suffer a setback which may involve several days of serious disability. How are those who are to make the determinations to decide whether the claimants are lying in bed because they are lazy or because they have one of those ill-defined conditions? Most of the people in this group whom I have encountered have been very distressed about their illness and keen to get back to work and to lead a reasonable social life. They are frequently frustrated by the relapsing nature of their illness. In fact, it is their eagerness to get going again that often leads to such relapses.

Clause 8(3) requires evidence to be provided. I would be grateful if the noble Lord could indicate what that evidence might be. Under the current system, the evidence of the patient’s GP or consultant is frequently disregarded. Whose evidence will the assessors believe?

Will the Minister kindly explain the need for two almost identically worded provisions, subsections (1) to (4) of Clauses 8 and 9? Will he explain also the difference between “limited capability for work” and,

“limited capability for work-related activity”?

As regards Clause l0(1)(b), I have sought in vain for a clear definition of a,

“member of the support group”.

That phrase has been used several times this evening. What is that support group, and will the Minister consider defining it in Clause 23? Will he explain more fully what the Government have in mind in subsection (2)?

Is it the Government’s intention that the healthcare professionals mentioned in subsection (7) will be appointed on the same basis as they are currently; that is, that the work will be subcontracted to a private company? What type of training will the professionals receive and from whom? One of the current problems is that examining doctors do not always have a good grasp of English, particularly when a patient has a strong regional accent. As the noble Baroness, Lady Murphy, said, often those doctors are not capable of distinguishing between different sorts of illnesses. Perhaps a computer would be better. Can we be given an assurance that that will not be a problem in the future?

Regarding Clause 11(2), what will be the qualifications of the people responsible for conducting the work-focused interviews? Subsection (7) states that an interview will be conducted by the Secretary of State, but I am sure that that cannot be the case. Who will it be?

What would be the position of one of the Secretary of State’s officials who, under this legislation, persuaded the claimant against his better judgment to take up a work-related activity which resulted in a serious deterioration in the claimant’s condition? I ask that because I am aware that, under some circumstances, cognitive behavioural therapy and graded exercises are recommended for people suffering from depression and chronic fatigue syndromes—with some success. That is not necessarily the case regarding people suffering CFS/ME, because, although they may be depressed and fatigued, they may have also a number of other symptoms that may not be picked up in a medical examination, and which can be exacerbated by exercise.

Clause 13 provides for an action plan in connection with work-focused interviews. Subsection (3) makes provision for them to be provided to the person who is subject to a requirement to undertake work-related activity. Are those plans to be agreed with the person involved?

I have read and re-read Clause 14(1) and cannot understand its meaning. I would be grateful if the Minister could translate it into plain English.

The Bill is both necessary and timely. The system for paying benefits to people who are sick or out of work has become much more complex than it was when I worked in the Ministry of Pensions from 1959 to 1962. In those days, it seemed that everyone got two pounds and 10 shillings a week, whatever their condition, and the pension was two pounds and 10 shillings a week as well. I look forward to the Bill’s progress through this House.

My Lords, I thank my noble friend Lord McKenzie, the Minister of State, for his introduction, and I congratulate him on his new appointment.

My Lords, that was a bit of anticipation on my part.

This is essential legislation, which seeks to modernise the welfare state. I agree with those who say that the change needs to combine compassion and care, but I think that we should look at Labour’s inheritance between 1979 and 1997. The number of people on incapacity benefit trebled, as people were written off to a life on benefits to hide the true number of unemployed. If numbers on incapacity benefit had continued to grow at the rate that they did under the previous Government, there would now be 4 million people on incapacity benefit. Unemployment doubled between 1979 and 1997; it twice hit 3 million. We had long-term youth unemployment, which topped 300,000 compared with just 6,700 today. We had a benefits system that was passive, providing little support and few obligations to encourage people out of benefit dependency and poverty. Over an 18-year period, child poverty more than doubled. That was the situation that this Government sought to improve, and in many areas, whether it is employment or reducing child poverty and benefit poverty, there have been significant gains.

As it was for others, it was a privilege for me to hear the noble Lord, Lord Morris of Manchester, give us an historical analysis based on his previous disability legislation. I believe that this Welfare Reform Bill has it right when it talks about the rights to benefit being accompanied by each person’s responsibility actively to seek work, recognising that some people, by virtue of their disabilities, will be unable to work, a point made by many noble Lords. Even changing the name of the benefit from “incapacity benefit”, which seems to define a non-changing, permanent condition, to “employment and support allowance” seems positive.

I welcome the Government’s assurance that this is not about cutting benefits or forcing people into work, but I recognise the concern expressed by some. The noble Lord, Lord Kirkwood, expressed his anxiety about conditionality, and the noble Baroness, Lady Murphy, referred to the sanctions. They saw it in a negative light; I see it as a positive encouragement, although I recognise that disabled people face barriers.

We know from our experience with the New Deal and jobseeker’s allowance that successful support is founded on complementary benefit and support structures. The examples that we have had of the Pathways to Work pilots and jobseeker’s allowance give us encouragement. Transforming the gateway to benefit—the personal capability assessment—from being purely focused on establishing benefit entitlement to a much more constructive and proactive approach which focuses on capability is, I believe, the right way forward. It will examine not only what an individual cannot do but also what they can do and how they might be helped to improve their capacity.

I share the concerns of those who cite mental health problems. We know that the number of people involved has risen significantly from less than 20 per cent in the 1980s to nearly 40 per cent now. We want this new personal capability assessment to be more sophisticated so that it can better identify people with mental health conditions and tailor help to them more effectively. That means more resources, and I hope that that will be taken care of in the Minister’s reply. The policies are not about forcing people to seek work or undertake work-related activities that are detrimental to their health conditions; they are an attempt to break down the barriers faced by incapacity benefit recipients.

I share the concern of a number of noble Lords about changing employers’ attitudes, but the laudable desire to get people back into work will not succeed unless we can make a fundamental difference in this area. Some years ago, I tried to get a young deaf person back into employment and I remember the difficulty that I had with a large employer. It characterised itself as an equal opportunities employer yet seemed unable to understand the flexibility that it had to apply in recruiting someone with that disability who could make a positive contribution. There is plenty of work to be done in that area if the Government’s long-term aims and aspirations are to succeed.

We also need to break down the age barriers, recognising the huge demographic challenge ahead: by 2050, we will have 50 per cent more pensioners. The Government’s aspirations are laudable: 80 per cent of the working-age population in employment, reducing the number of people on sickness benefit by 1 million, and getting 1 million older people and 300,000 more lone parents into work. Those are challenging targets.

Having listened to the contributions of others more expert than me, I am not sure whether the current proposals will simplify the benefits structure, but I hope that they will. I agree with my noble friend Lord Morris of Handsworth that we have to tackle benefit fraud. That is essential if we are to maximise support for the deserving cases. Although the noble Lord, Lord Oakeshott, said that it is just a question of carrots, I do not see this as a carrot-and-stick situation. That is an unfortunate and negative analysis. People in this country expect fairness, and benefit fraud has to be dealt with, regardless of the extent of that fraud. I think of the recent case, which received a lot of publicity in the papers, about the marathon runner who had clearly overcome his incapacity to work. My noble friend said that he lacked any motivation to seek work; no doubt he was too busy training.

I was also interested in the comment of the right reverend Prelate the Bishop of Leicester on housing benefit withdrawal. I am sure that that would be the last resort. For those of us who have lived either in or close to estates where there are serious problems, the question is: what do you do about families who refuse to achieve a reasonable standard of behaviour? Do you let them continue to terrorise the rest of the estate where you live or do you decide that, as a last resort, and having attempted to help as best you can, some action has to be taken? I do not believe that the Government intend in any way to punish children. As I have already said, the record on reducing child poverty has to be acknowledged.

I do not want to end on a negative note, because I believe that this is positive legislation. It is time to reform our welfare programme. The Bill allies the right to work with the right to benefits for those who need help and care, and I commend it to your Lordships.

My Lords, I applaud the objective of the Bill to reduce by 1 million the number of people who are dependent on disability benefits. I should have thought that for people who, like me, have had a longstanding concern about unemployment, this would be a day of rejoicing, but I find myself deeply worried by what I regard as the unintended consequences of the Bill. To explain why, I shall concentrate on the 50 per cent or so of people who have a mental health problem as either their primary or secondary diagnosis. My noble friend Lord Low spoke eloquently about the impact of the Bill on physically disabled people.

I should declare an interest. I chair the East London and City Mental Health Trust and a clinical ethics committee for the Central and North West London Mental Health Trust. The aim of the Bill is to enable people to return to employment, but for those with fluctuating disorders, including most mental health disorders, the fear of taking a job is considerable. First, they face stigma when they return to work. They are very likely to face suspicion on the part of their manager and peers. They generally lack confidence and are likely to assume that they will probably fail. They will often be able to work only part-time, and on fairly low incomes. On top of that, they fear that if the job goes wrong, it will take months to restore their benefits. That fear is based on their personal experience; destitution is never far away from these people.

If the Bill could assist just one of those very real problems, it should do so. Reform of the linking rules would be an important start. These rules are designed to ensure a rapid restoration of benefits to a person previously on disability benefit who takes and then loses a job. These linking rules simply do not work. First, the restoration of benefits is not automatic. The applicant still has to complete an application form and visit the jobcentre for an interview. If a person with a mental health problem has just lost a job, they are likely to be curled up in bed thinking that life simply is not worth living. The last thing on their mind will be to make a claim for benefit. Similarly, the likelihood of the person turning up at the right place at the right time for an interview is small and in some cases non-existent.

I recently asked the manager of a jobcentre to talk me through exactly what would happen to a mentally ill person who takes and then loses a job. Her response was devastating. She explained the system as it was supposed to work and then she said, “Quite honestly, what usually happens is that the police pick them up and they are taken back to hospital. We can’t really help. We don’t really understand mental problems. There’s no doubt that mentally ill people really suffer in this system”. Those were the comments of a person responsible for operating these rules.

The linking rules will never work with this group unless they are truly automatic. Ministers tell me that the reason for the lack of automaticity is the need to avoid abuse. I would ask the Minister to consider whether it might be less costly to the Exchequer to restore benefit immediately and then to undertake checks when this approach would prevent extremely costly hospital admissions. We need only go back to the jobcentre manager for evidence of that.

Vitally important, too, is the need to extend the linking rules to include automatic restoration of housing benefit at the previous higher level for a person not in work. As noble Lords know, if you go into work, your housing benefit drops; if you leave work, in theory, your housing benefit rises. I know that the department has been considering that position and I should be grateful if the Minister could give the House an assurance that plans are in place to render the linking rules, including housing benefit, truly automatic for the most vulnerable group in the context of the new Bill.

I have thought long and hard about how those with fluctuating disorders, including those with moderate or severe mental health problems, can be helped by the Welfare Reform Bill. There is a positive and constructive way forward, but only on the basis that this entire group would be placed in the support group. I do not like to disagree with the noble Baroness, Lady Hollis, but sanctions will not work for people with moderate and severe mental health problems. The NHS and DWP need to work closely together to deliver the right package of help and support to return as many as possible of these people to employment for as much time as they can manage. I therefore greatly support the Government’s objectives; my only concern is about the means to attain them.

The package, which appears to be readily available, requires four elements. The first is evidence-based psychological therapy at a cost of just £750 per person. This work is currently being piloted in two NHS trusts. The second is evidence-based individual placement and support, a form of supported open employment widely tested in the US and found to be successful for people with mental health problems. London mental health trusts, and no doubt many others, are introducing this approach, and in two cases they have already done so. The third is work with employers to reduce the stigma of mental health issues and to ensure a more supportive environment in the workplace with the support of NHS staff. I understand that the DWP is doing important work in that area. Nothing I am saying is new, and if you put it all together, you really begin to get somewhere. The fourth crucial item is the reform of, and rendering automatic, the linking rules to take away the fear that these people face when they take the first steps into jobs.

I turn to other concerns about the Bill. The policy presented in the Bill was tested in the Pathways to Work pilots, which were well resourced and included regular back-to-work interviews and opportunities to benefit from a variety of support services and a back-to-work bonus of £40 a week. I hope that that bonus is in the regulations. The pilots were rightly heralded as a success, but hidden behind the success was the fact that people with mental health problems were not assisted into work by the Pathways to Work pilots. The pilots worked for others.

The system to be introduced by this Welfare Reform Bill will be a pale reflection of the pathways pilots’ design. For a start, the DWP faces a 5 per cent spending cut in 2007-08. There will be fewer staff and, no doubt, staff less well trained to process the employment and support allowance system. All this bodes ill for vulnerable claimants. What, then, are the important differences between the pathways pilots and the Bill itself?

First, the Government plan to contract out all the work associated with the new employment and support allowance. The justification for contracting out the service is based on a flawed evaluation of an entirely different project involving the placement of unemployed people. In that project, the contracted-out service was altogether stronger in design than the in-house model with which it was compared, thus proving nothing. The successful Pathways to Work pilots were, by contrast, undertaken in-house by Jobcentre Plus. The fact is that we have no evidence that contracting out the employment and support allowance will help clients back to work. There are reasons to fear the opposite.

Secondly, contractors will be outcome-focused. They will, I understand, be paid only if they place a person in a job. That did not apply to Pathways to Work. We can assume that the financial incentive of payment by results, or payment for every successful job placement, will either result in undue pressure being placed on people with mental health problems, whose symptoms are likely to increase under stress, or this group will simply be left out in the cold.

Thirdly, the £800 per job placement is based on the actual cost of placing someone in work in the pathways pilots. But we know that mentally ill people were not helped into work. The question then is: what would it cost to place people with mental health problems in work? It would certainly cost a good deal more than £800 per person. For example, we know from the Sainsbury Centre that the average cost of condition management in the pathways pilots was £1,200. The figures stack up only because 12 per cent of people on those pilots received condition management.

Apart from the dilution of the pathways model, there are many other concerns. One of our problems in debating the Bill is that most of the detail will be in the regulations. The personal capability assessment that others have mentioned will determine whether a person is deemed to have a “limited capability for work” and is entitled to the ESA, or whether they fall into the support category. The PCA is thus of huge importance to claimants; it determines their livelihood.

The PCA has until now failed to assess mental disorders effectively, as others have mentioned. A lot of work has been done to improve the tool used for mental health assessments, and I applaud the Government for that, but the accuracy of the PCA will depend on more than the tool itself. It is essential that the person undertaking the mental health assessment has appropriate training as well as regular contact with the person being assessed so that he really understands how the person is over time. At present, the person’s GP will be invited to complete a form before the assessment begins. Many mentally ill people, particularly those with severe and enduring problems, rarely see their GPs. A member of the community mental health team would be in a far better position to help. In view of these failures, I trust that the Government will test the new PCA all the way to appeal in order to ensure that it will be successful.

A major issue is the conditionality introduced with the ESA group. It sounds very reasonable, until we get down to individual cases and what it will mean in practice. I met someone recently who suffers from clinical depression and anxiety. She is literally terrified by this system. Her symptoms are made worse by leaflets coming through the door, and it is difficult to imagine how she is going to cope with the process of being invited to assessment after assessment, interview after interview, and so on. She feels that her whole life will be under threat.

I fully support the Government’s commitment to increase the number of people in employment by 1 million over 10 years, but I am profoundly concerned that the Bill will cause increases in NHS expenditure and will not achieve the Government’s objectives unless the concerns that we have all expressed are addressed.

My Lords, one of the advantages of being called on to sum up a debate is that I can refer to noble Lords who have clarified points. This is an odd Bill. Getting people off benefits and into work whenever they want is rather like motherhood and apple pie—how could anyone possibly be against it? The problem is how to do it effectively and to benefit people without damaging a few of them, some of them or all of them along the way; that is, how to minimise the risks and personal damage. That is where the problems lie. Throughout this debate noble Lords have said that the Bill is a good idea, but they have also asked about this or that aspect of it. That is not unusual in this area, and I do not think that the Minister will thank the business managers for scheduling the debate on the Mental Health Bill so close to this debate.

I turn to the concerns that have been raised. The main point was that the provisions’ success or failure will lie in work-focused interviews and activity. In practice, the provisions will stand or fall on correctly placing people according to their skills, condition and disability. How can we give people the back-up they need to get off benefits and into the workplace? I have long been dealing with disability matters in this House, and there have always been two issues to address: perception and practical help. I believe that perception is the first issue to address. If it is perceived that someone in a wheelchair is unemployable, to take an easy example, he will be unemployable because he will be told that he cannot work. The minute the problem is addressed in a slightly more lateral manner, it becomes a minor problem because other jobs that he can do will be discovered. But people in wheelchairs are comparatively easy to deal with provided that that is their only problem. Although they have a movement problem, modern regulations have been introduced to help enable them to get into offices. Much work is based around modern business technology—PCs—and using a keyboard. Many people in wheelchairs will not have great difficulty using that technology once the initial impact of doing the job has been overcome.

When we get to the more complicated group of people with mental health problems, the perception is that that they are all raging psychopaths waiting with an axe at the coffee vending machine, or that if they hear a cross word they will break down in tears or not turn up the next day. They will not do those things. Those perceptions must be broken down. Other legislation has attempted to do so. The Government must take that on board when they implement this legislation or much of it will fail that group.

The noble Lord, Lord Low, made the excellent point that certain groups—those with straightforward mobility problems, for example—can be creamed off and dealt with quite easily now. Other groups with physical disabilities will be more difficult because they are not understood. Unless we co-ordinate what can be done and what should be done, we will fail. The conditionality clauses, Clauses 10 to 15, are where the legislation will stand or fall. Unless we get the right support for people undertaking interviews and assessments, everything else will be of limited value. I have looked at the Bill and dealt with this subject over a number of years, so I shall ask the Government a series of questions about the conditionality process that go back to the theme of training which the noble Baroness, Lady Hollis, and I have raised. I did catch the spray from that shot across my bows.

When a person’s needs are more complex and they belong to two groups, things can get more complicated. As has been pointed out to me, somebody who has AIDS or a physical disability may have more reason to be slightly depressed than someone who does not. It may be complicated to place a target group of people with a complicated cocktail of disabilities. How do we address placing them when they have to face two sets of perceptions?

Provision for training and best practice should be written into the Bill, as should a duty on those undertaking the assessment and interview to call on expertise and support when they feel they need it, or suspect they do, in order to prevent the wrong advice being given. Such advice has led to successful appeals under the current system. If we achieve a degree of success in this part of the Bill, we will have made real progress.

Although I appreciate that this will have to be teased out in Committee, I hope that the Government will give us some idea about the linkages—the joined-up government, if we must use that now rather worn expression—with the Government’s awareness programme for employers. Let us concentrate on the employers who do not feel a need to employ a public relations firm; that is, the small employers who are supposedly the dynamic part of the economy. The big people who have big advertising budgets know how to implement the Government’s schemes. They also know that it is worth their while to do so, because they are playing at a higher level. How are the Government getting into the small and medium-sized parts of the economy to address the bad perceptions facing some groups? If we could hear about such linkages and co-ordinate them with support for those implementing the system, I would be considerably less worried less about it.

If we do not address those problems we will have real trouble. We may unintentionally go backwards and not forwards. But that probably will not happen because of creaming-off. People will say, “Statistically, we were able to do this”. But that will have been comparatively easy. We could create a second class of people who are pushed yet further back. I think that people suffering from mental health problems will probably comprise the biggest part of that group. We have to press on.

The situation will change as drug treatments, like support for those with physical disabilities, improve. We must be able to update and inform these people on a rolling basis. I could flog that point to death, but I should look more widely at other parts of the Bill. For example, will the Government themselves take action to improve access to work? All noble Lords have mentioned that point although it was supposed to be the best-kept secret. I wonder how the Budget will survive such secrecy. I believe that the departments themselves are supposed to be taking on the related expenditure. How much money is being put aside to implement this? Is there a guarantee that the result will not be departments which need three clerks deciding not to hire someone in a wheelchair because accommodating them would take up some of their budget and allow them to hire only two clerks? How will that be addressed in the departments? It would be an interesting example for other employers.

I can quickly address the housing benefit provisions in Part 2. The single room rent issue is an anomaly of catastrophic proportions. It guarantees that a young unemployed person will be discriminated against. As the prison statistics show, many young unemployed males end up in prison. I therefore again urge the departments to look over their shoulders at other departments. Also, on housing benefit, what exactly will be the on-costs? Perhaps a little punishment and a rap across the knuckles are in order here. I wonder what exactly the costs will be as people lose housing benefit because they are badly behaved and lead chaotic lives. I suggest that it will only build on the problems, not remove them. One may feel better by implementing the provisions until they come back to you on your doorstep.

We can look at many other issues. I think that the noble Baroness, Lady Murphy, said that one should monitor the processes and the IT systems. It is vital to monitor everything to do with this system. During the Bill’s passage we have to ensure as a collective unit that the Government clearly answer how they think their regulations will come in and how they will create a system that stands a chance of working. Unless they support their front-line staff to make correct decisions and give them the flexibility to call in the help they need, we will end up having to address this issue again—after perhaps five years of hiding behind statistics that are rapidly moved round to show that everything is fine, until we have to admit that it is not.

My Lords, I am grateful for the deliberation noble Lords have given to the Bill today. It has been the House at its very best. I will seek to address the specific points raised. Before that I will take the opportunity to welcome the degree of consensus that has already been built up on the overriding principles behind the Bill, which has been evident throughout today’s debate. I acknowledge the concerns expressed about practicalities, about resourcing and expertise—and I note that we will have some interesting debates about the shared room rate and housing benefit sanctions.

I will go through as many of the specific points as I can in the 20 minutes allotted to me, while recognising that when we get to Committee stage pretty much everything we have discussed today will feature again. The noble Lord, Lord Skelmersdale, asked whether this was all about fears of harassing people with mental illness back to work. It demonstrably is not. This is about people we know want to work and helping them to break down the barriers that prevent them working.

A question was asked about existing customers. People already on incapacity benefits will have their cash benefits protected. Over time we will migrate existing customers to the employment and support allowance to bring all customers under the same system, helping to smooth administration and reduce complexity.

The noble Lord asked whether a claimant with mental health difficulties would be able to bring an intermediary to the assessments. The answer is yes, we would encourage customers to bring a representative to medical assessments. It is most important that the entitlement is based on decisions that have the correct evidence. The noble Lord, Lord Skelmersdale, asked about regulations. Regulations relating to Clauses 12 and 15 have not been prioritised and are not in the release later this week. I hope that regulations relating to Clauses 8 and 10 will be informative and help our deliberations in Committee.

I was asked whether the terminally ill will go on to the main phase immediately. The way we treat people with terminal illnesses is obviously a very sensitive issue and I am conscious of the arguments put forward in favour of shortening the assessment phase for this group. We continue to look at how best to support terminally ill customers and will return to the House at a later date with our response. The issue about people undergoing cancer therapy was raised by the noble Lord, Lord Skelmersdale, and my noble friend Lord Morris of Manchester. There will be no automatic process on to the support group. We do not want to write anyone off, so the criteria for entitlement to the support group are based on the functional limitation that the individual has as a result of the condition.

On local housing allowance, the question was asked whether landlords would pull out of the market. It is true that there was initially a lot of opposition from landlords to the local housing allowance, but the pathfinder evaluation has revealed that while some landlords have left the market others have joined and there has been no impact on overall supply. One of the benefits of the local housing allowance is that the landlord will not necessarily know that the tenant is on the housing benefit so that will remove some of the difficulties that may currently be encountered.

A number of noble Lords—the noble Lords, Lord Addington, Lord Skelmersdale and Lord Low—asked what is being done directly with employers to ensure their engagement with people with mental health conditions in particular. The Government are committed to supporting employers and tackling discrimination, but we need to work on the good work of organisations such as the DRC, which works to raise awareness of disability issues with employers. The DWP has recently launched a major campaign aimed at employers, especially small and medium-sized enterprises—the point pressed by the noble Lord, Lord Addington—to help them recognise their obligation under the DDA as well as the benefits that that can bring.

In October last year, the Department of Health launched a new initiative, Action on Stigma: Promoting Mental Health, Ending Discrimination at Work. At Budget 2006, the Chancellor announced a cross-cutting review of mental health and employment outcomes which would look at existing best practice, holes in provision and options for the future. The review, which is ongoing, will provide recommendations for practical solutions and we hope that it will be completed by Budget 2007.

The noble Lord, Lord Oakeshott, raised the issue of psychological therapies and of CBT in particular. I agree that psychological therapies, such as CBT, can often play an important role in helping many people with mental health problems to manage their condition and return to work. As such, we are exploring ways of increasing access to those therapies. The Department of Health established the Improving Access to Psychological Therapies programme, which aims to develop a service model for delivering a range of evidence-based interventions. There are two national demonstration sites, in Newham and in Doncaster, one of which was referred to by the noble Baroness, Lady Meacher. While we believe that cognitive behavioural therapy has a role to play, we must remember that one size does not fit all and psychological therapies may not be appropriate for many of our customers. We need to consider a range of support for people with mental health problems, and I refer again to the Treasury’s review of these matters.

The noble Lord, Lord Oakeshott, asked whether these resources were affordable. Over the next two years, we will be investing a further £360 million on our welfare reform Green Paper proposals, which include extending the Pathways to Work programme nationwide by 2008. The department is working through the implications of the spending review settlement for its employment programmes and is working closely with HM Treasury to ensure that spending plans between 2008 and 2011 support departmental aspirations. The question was asked whether we can deliver pathways while cutting staff. That is a question of prioritising resources. We have announced that the remaining 60 per cent of pathways will be rolled out using primarily private and voluntary sector participants.

The noble Lord, Lord Oakeshott, and the right reverend Prelate the Bishop of Leicester asked about the anti-social behaviour processes and the withdrawal of housing benefit. The Government have a wide range of measures to tackle anti-social behaviour as well as the provisions in this Bill. The court’s decision to evict a household is often taken for the whole household and is dependent on robust considerations relating to the needs of the wider communities and the individuals concerned.

A question about safeguards was raised. There will be safeguards to protect the vulnerable. Each case will be considered on an individual basis before a local authority pursues a housing benefit sanction. It should take a decision about whether a sanction is an appropriate tool to use or whether a different route could be used. For example, if there are serious mental health issues, a referral to mental health services might be a more appropriate route. We intend to pilot the Clause 30 provisions for two years only and will fully evaluate that before any decision to roll out the scheme is taken.

The right reverend Prelate the Bishop of Leicester raised concerns both about children and about the creation of homelessness. We recognise those concerns. It is not the policy’s intention to sanction large numbers of people. A sanction is not a punishment; it is an encouragement to accept an offer of support to households in crisis.

The right reverend Prelate the Bishop of Leicester asked what happens if support is not available. If support is not available either because the local authority does not have support structures in place or the programmes are full, then no sanction could be applied.

Why are we targeting people on housing benefit? Well, we are not specifically. No one is suggesting that anti-social behaviour is confined to those in rented accommodation or to those who claim state benefits. We do not see this measure as the primary tool for tackling anti-social behaviour; rather, it is one measure that can assist in that.

The noble Lord, Lord Oakeshott, asked how we are rolling out Pathways to Work whether it works. Pathways to Work already covers 40 per cent of the country. The remainder will be rolled out in two phases and delivered by providers. Phase 1 will be up and running by October 2007, with phase 2 by April 2008. Again, the issue of resources was raised. We have repeatedly committed to funding a national pathways service and there is no question of doing that on the cheap. This is not a cost-cutting exercise, but obviously we have to live within the spending review settlement.

My noble friend Lord Morris of Manchester, who I know was struggling to be able to stay for the whole of this debate, spoke with authority as usual. I acknowledge his expertise and welcome the benefit of his wisdom in the weeks and months ahead. He spoke, as others did, about employer resistance, which is a hugely important factor. He did say that sanctions do not work and asked why we needed them, as not many people have sanctions imposed on them. It is entirely right that, in return for our offer of pathways-style help and support, we ask customers to engage with us. Research with pathways customers found that sanctions are an important factor for some in maintaining their attendance at work-focused interviews. The success of this approach is demonstrated by the fact that only 1 per cent of customers in pathways pilots have had sanctions imposed on them.

The noble Baroness, Lady Thomas, asked whether personal advisers have discretion if someone with a mental health condition misses a work-focused interview. Yes, they will have that discretion. We have introduced a series of safeguards to ensure that no sanction is imposed in cases where someone has a mental health condition until a face-to-face discussion has been held with the customer to ensure that they understand the requirements. The noble Baroness also asked about the participation of GPs and whether they are effective. Procedures are in place to identify doctors who do not provide reports when asked. I can provide more information in Committee or otherwise if the noble Baroness so wishes.

A question was asked about investing more in mental health services. In 1999, the Department of Health published a national service framework that set out our vision for mental health care. Between 2001-02 and 2005-06, the NHS and local-authority planned expenditure on mental health services has increased in real terms by 25 per cent, and there are 50 per cent more consultant psychiatrists, 75 per cent more clinical psychologists and at least 20 per cent more mental health nurses than there were in 1997.

A question was also asked about the backdating of claims. We have decided that additional support should be provided at the end of the assessment phase. For many customers, this is an increase compared with the existing system in which customers must wait for up to a year before receiving the higher rates of benefits. We must strike a balance between the needs of our customers and the need to simplify the system.

Several questions were asked about the computer system for the PCA, and whether it would be flexible enough to take non-standard answers. Yes, it will. The LiMA system is there to support healthcare professionals carrying out the PCA assessment, and a healthcare professional remains in full control and can override the system wherever appropriate.

The noble Baroness, Lady Thomas, and the noble Lord, Lord Low, asked whether there was a conflict of interest in the work-focused health-related assessment being carried out at the same time as the PCA. We do not believe that there will be. The work-focused health-related assessment is an integral part of the revised PCA. It is a forward-looking assessment of health interventions that will help to break down the barriers to entering or returning to work. However, we will pilot the work-focused health-related assessment later in the year, and will then review its timing.

The noble Lord, Lord Low of Dalston, reminded us quite powerfully of the scale of the challenges that we face if we are to stimulate and facilitate the aspirations particularly of people with mental health problems. He also asked whether the PCA should reflect socio-economic factors in deciding limited capability for work. Of course these factors have an impact on the rehabilitation of people with a disability and on their confidence and ability to enter or return to employment. Entitlement to benefit must be defined in a way that applies nationally and consistently, not in a way that is dependent on local conditions such as the availability of transport or the attitude of prospective employers.

The noble Lord asked how we will ensure that contracts do not encourage providers to help only those people with fewer support needs. That theme was picked up by others, including my noble friend Lady Hollis. The bids for Pathways to Work contracts for potential providers should include details of the skills and experience that they have that enable them to address the specific needs of all customers and the barriers against them, and the bids will be assessed against that information. Contracts do specify that a provider should not discriminate against anyone on the basis of their disability. If providers ignore those with complex or longer-term needs, they will clearly breach this requirement and will have to remedy the situation, or ultimately their contract may be terminated.

The noble Lord, Lord Kirkwood, asked about the “work first, benefits second” approaches which my noble colleague the Minister of State referred to in a speech. This does not represent a change in direction from the current agenda in welfare reform. The concept of promoting work over benefits has been at the heart of the Government’s agenda since 1997. The Minister of State discussed this matter at the first seminar of a series of seminars on the future of welfare in the next decade. The seminars are about exploring and discussing ideas for the future of welfare, rather than about representing specific policy proposals. The noble Lord referred specifically to the benefit process in Galashiels. Perhaps I should write to him separately on that matter.

The noble Lord also talked about the use of Section 82 and how it did not work satisfactorily before. I hope that the lessons have been learnt from that. It is very important that the resources are in place so that we get the IT systems fully up and running and tested before we press the button. There is a long lead time to that, which is why we need to go through these processes.

My noble friend Lady Hollis, in a typically thorough analysis, asked whether providers will ignore those who are harder to help: will they cherry pick under the contract facility? In any programme based on results, we can never entirely eliminate the risk that providers will cherry pick. Therefore, as part of contract management, we will need to monitor outcomes and regularly review providers' performance to ensure that any problems are dealt with early. She asked whether we can help former employers re-employ disabled people. We do not believe that that is financially viable. Our approach is about working with employers so that they understand the benefits of employing disabled people and ensuring that people are incentivised to go into work.

The noble Lord, Lord Kirkwood, asked about the details of the IT and BPRP situation. Perhaps I can cover that in correspondence in due course.

The noble Baroness, Lady Greengross, asked about permitted work for those who will never move to full-time work. We recognise the importance of part-time work to well-being and to developing self-worth and are looking at the best ways to continue to enable people who are currently far away from being able to work full-time to take part in work or work-related activity. People in the support group will still be able to undertake permitted work.

Are we going to increase the £85 limit at which deductions from the contributory allowance for pension payments start? No, we keep the figure under continual review but have no plans to increase it because we think that that is an appropriate level. The treatment of occupational pension payments is one of the most generous income disregards in the benefits system.

The noble Lord, Lord Best, asked how many claimants have a shortfall between rent and benefit in the local housing allowance pathfinders. In the pathfinders, about 39 per cent of claimants have a shortfall under the LHA, the average shortfall being about £17 a week. He referred to a switch in the average from mean to median rents. The median rent basically takes the point in the middle and therefore should address unrepresentative low or high rents at either end of the scale. Perhaps we can pick up the outcome of that when we return to the matter in Committee. On the shortfalls under the local housing allowance shared room rate, in the pathfinder areas, the average shortfall for those assessed under the single room rate has fallen from £30 per week before the LHA was introduced to its current level of £27 per week.

My noble friend Lord Morris of Handsworth spoke about the importance of the legislation and said that he was in favour of welfare, not workfare and it is certainly not about workfare. He asserts that the Bill should get full scrutiny and I am sure that that is right.

The noble Baroness, Lady Murphy, asked whether we would continue to monitor how the revised PCAs are implemented. The answer is yes. The Minister for Welfare Reform has given an undertaking that we will continue to monitor the revised PCA for the first years after its introduction. She asked about health care professionals carrying out the PCA and whether they will receive training in assessing mental health. The answer to that is yes. I am sure that we will return to that in Committee.

I was asked about access to LiMA software and why we cannot scrutinise it. LiMA software is the commercial property of Atos Origin, so it is exempt from disclosure.

The noble Countess, Lady Mar, referred to sufferers from CFS/ME. We fully recognise that CFS/ME is a genuine condition that can be very disabling. Each individual will be assessed on the functional limitation that he or she experiences as a result of their condition. She raised issues about the personal capability assessment. The personal advisers carrying out work-focused interviews will be able to defer an interview if the person is unable, on account of their condition, to attend on the appointed date. She raised a series of other questions which we shall have a chance to pick up in Committee—specifically on the detail of the regulation.

My noble friend Lord Young of Norwood Green referred to the demise of the term incapacity benefit. That encapsulates the change in ethos that the provisions are intended to introduce. I agree that this is a positive piece of legislation.

The noble Baroness, Lady Meacher, asked about linking rules. We intend to bring forward the current rules that apply to incapacity benefit to contributory ESA, including the more generous two-year linking rule for work and training that came into force in October 2006. We are seeking to bring the short-term linking rule for income-related ESA into line with the rule that applies to income-related JSA and income support; that is, a 12-week provision rather than eight weeks.

It has been suggested that we are rolling out the Pathways to Work programme on the cheap. I think I have dealt with the point: we are certainly not. It needs to be effectively resourced if it is to achieve its objective. The noble Baroness also asked about further evidence and whether the GP is always the best person. We fully intend that further medical evidence will be sought from the most appropriate source, which might well be someone other than the GP.

The noble Lord, Lord Addington, raised a range of issues about the practicalities, including questions about whether the resources are going to be in place, and if proper training will be available. The provisions in the regulations will help in some of that, but no doubt we will return to these points in Committee.

In 1997 we set out on a journey. Throughout that journey our values have underpinned our reforms and driven our agenda, but there is still more to do. Where discrimination still exists and where the right to work is still not truly open to all, we have to rise to the challenge and be radical to stay on track to deliver. That is why this Bill is so important. It is absolutely fundamental to our agenda. It promotes opportunity, it breaks down barriers to work, and it will deliver another blow in our fight against poverty and social exclusion. It will take us another step along the road of creating a welfare state which rather than foster dependency will facilitate aspiration. It is founded on a positive can-do attitude as opposed to the defeatist mentality that nothing can be done.

On Question, Bill read a second time.

Mental Health Bill [HL]

My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

Moved accordingly, and, on Question, Motion agreed to.

House in Committee accordingly.

[The DEPUTY CHAIRMAN OF COMMITTEES (Baroness Gould of Potternewton) in the Chair.]

Schedule 6 [Mental Capacity Act 2005: new Schedule A1]:

62: Schedule 6 , page 82, line 3, leave out “1 year” and insert “6 months”

The noble Baroness said: I do not look like either my noble friend Lord Rix or my noble friend Lord Adebowale, but I understand that it is in order for any noble Lord to move an amendment that has been tabled. This amendment concerns authorisations under the Bournewood proposals.

One of the problems that, I think, we all have with Bournewood is that we do not know how many people are going to be subject to them. We have had several guesstimates of how many there might be and the characteristics of patients that will make them subject to an authorisation. So far as I can see, it could be any number of people, anything from 3,000 or 4,000 up to 400,000 depending on the characteristics of the individuals concerned.

It is possible that, on many occasions, there will be no need for the period of authorisation to last for longer than a few weeks. That is my hope—I see that the Minister is nodding, so I am hopeful that that is correct—but I can also see that there may well be a rather larger number than we think of people, particularly the elderly with dementia, who will need a longer authorisation period. Some elderly people regularly go “sundowning”, which is what we call it when they wander around inside a residential care home trying to get out, looking to go home, back to work or, as one of my patients used to say, “I’ve got to get out to get me husband’s tea”. They constantly rattle the door. It is a very common scenario.

Many such people will be subject to the Bournewood provisions when people understand the benefits that they could have for their overall care and security for staff. So there could be occasions when the period will extend beyond a year and possibly go up to two or two and a half years. The amendment would offer the same kind of protection in terms of assessment and the period of authorisation as is provided under the treatment clauses in Section 3 of the Mental Health Act. It is to give an equivalent protection in the time period for an assessment before the renewal of an authorisation. I beg to move.

In the absence of the noble Lords, Lord Rix and Lord Adebowale, I wish to speak to the amendment for three reasons. First, we began to discuss the Bournewood provisions two weeks ago. Since then, at the end of last week, there has been a court case in which there was a finding against Surrey County Council that may turn out to be very important. I am sure that the Minister will decline my invitation to pass an opinion on it, but I think that there is already fairly widespread agreement that it amounts to a significant change in the definition of “deprivation of liberty”. In view of that judgment, will the Minister’s department consider issuing new guidance on the matter of deprivation of liberty? If so, it is entirely valid that we should discuss the amendment moved by the noble Baroness.

Secondly, how did the department come to its figure of one year? How long is the average stay in a residential home of someone who is likely to come under the provisions? I accept that people who are likely to be deprived of their liberty in residential homes often have significantly different characteristics from those detained under the Mental Health Act in that many of them have Alzheimer’s and many of them are very frail.

I hesitate to say this in the presence of someone as eminent as the noble Baroness, Lady Murphy, but it is not unknown—in fact it is fairly frequent—for older people’s cognitive abilities to be impaired for simple physical reasons. They may get infections, for example, and become confused, but these are only temporary states of confusion and can change. In that circumstance, a maximum period of a year, which could easily become a default if there were not the resources to go round, is too long. In replying to these points, can the Minister give an assurance that people who are likely to be in a temporary state of incapacity are not being unduly detained for long periods?

I support the amendment. The Minister will know that there are many opportunities for review of an authorisation. It can be instigated by a carer, a care home or a hospital where a change in someone’s situation is noticed, and that, I take it, is why an automatic review at 12 months is considered by the Government to be a kind of long-stop measure that will affect relatively few people.

I note the kind of examples that have been quoted, particularly the one just mentioned by the noble Baroness, Lady Barker, but there will also be cases where an individual or their carer may not have the confidence or the knowledge of the system to feel able to instigate a review of their authorisation, and for those people as well 12 months seems far too long to wait for a review of their situation, if one presupposes that it is not in the best interests of the person concerned to be deprived of liberty.

My understanding is that the Government justify the length of authorisation on two grounds. First, they have said that the automatic review at six months would be over-burdensome on services that are already stretched. Secondly, they say that authorisations would generally be for shorter periods and that therefore the provision would affect relatively few people. As I have just said, the automatic review at 12 months is just a long stop to prevent indefinite detention.

If I have got the Government’s position right, their two arguments are mutually exclusive. If it is true that relatively few people would be affected, reducing the maximum length of an authorisation could not be over-burdensome. I hope that the Minister will agree to look again at this modification.

I say to the noble Earl, “Very good”. I thank the noble Baroness, Lady Murphy, for moving the amendment. On behalf of everyone in the Committee, I say how much we miss the noble Lord, Lord Rix, this evening. As I understand it, he is still in hospital.

The noble Lord, Lord Rix, has been discharged from hospital and is now resting at home. He hopes to return after Recess.

I am extremely pleased to hear that. I hope he is therefore able to make his speech tomorrow night, as I have to replace him if he is not. I fear he will not, though. We wish him well in any event, and I am grateful to the noble Baroness.

Important issues have been raised. The noble Baroness began with her concern about the number of people who may be deprived of their liberty. I do not have to remind the Committee of the importance of the Mental Capacity Act 2005 or of these provisions. Noble Lords know well the provisions’ history and that the purpose of the Act is to make sure that we enhance the quality of care and support for individuals. Included in that is a recognition that, in certain circumstances, what we have described as “deprivation of liberty” may be appropriate in order to keep them safe, enhance their care and look after them effectively and properly. It is on that basis that we have to address these provisions.

Regarding the numbers, we have talked to psychiatrists who care for people with learning disabilities or dementia and to lawyers who are working in the field. We think that there would be about 1,000 to 5,000 authorisation cases each year. In the first year, we estimate, about 21,000 people will be assessed and about 5,000-plus authorisations will follow from that. That is an estimate by economists in the Department of Health, and it is based on the number of people who lack capacity and who need special protection. We have also looked at figures in one local authority to see how many of their clients may need an assessment.

We hope and expect that, as more homes and hospitals become familiar with the meaning of “deprivation of liberty” and how to avoid it, the annual number of assessments will fall to about 5,000 by 2014-15, which will lead to about 1,250 authorisations. As I indicated, those are estimates based on information that we have, but I hope that they give noble Lords an indication of the kind of figures that, we think, we are describing. I accept, however, that we are moving into a field where those estimates, good as they may be, will none the less need to be tested. Those are the assumptions that have been made.

Is the Minister able to tell us which local authority she was referring to? As she will know, residential and nursing home care provision differs radically between different authorities.

I do not have the information on that, but I will either get it or write to the noble Baroness. She is right: I have assumed for the purposes of this exercise that the Department of Health has looked at a number of local authorities and chosen one that, it thinks, is a representative area. I take on board the point that she raises about the difference in the type of care, numbers and so on, based on different populations, if nothing else. That is where we start from.

The noble Baroness, Lady Barker, asked three questions. She knows that I cannot talk about the current court case, as it is sub judice. However, it highlights the need for us to be doing what we are doing here and what we are proposing to add to the Mental Capacity Act. The Bournewood provisions will give clarity about what may lawfully be done to protect a vulnerable person who is not able to make decisions about their care. I believe strongly that this is needed by service users’ families and those who are providing and commissioning care. I cannot speak about the case, as it is still before the courts and we should not prejudge the outcome. However, we have always anticipated that the code of practice would be revised and reviewed in the light of case law. If there is anything to learn from the judgment, we will look at it. The noble Baroness was right to raise the issue.

I have been told that the local authority in question is Hampshire. The noble Baroness may consult her colleagues and come back to me if she feels that it is unrepresentative; I can think of a particular colleague whom she might consult.

Hampshire is a large county with established residential and nursing care provision. It also has quite a number of very old older people, so I am happy to accept that it is a good authority to use.

I am grateful to the noble Baroness for that endorsement. I hope that she recognises that it is an appropriate basis on which to operate, with all the caveats that I have mentioned.

The noble Baroness asked about the magic number of one year. It is not really a magic number. As the noble Earl, Lord Howe, and the noble Baronesses, Lady Murphy and Lady Barker, have said, it is our anticipation that, for many people, any form of deprivation of liberty, either because of infection, as the noble Baroness, Lady Barker, indicated, or because of other circumstances, will be for a short period of time. We have built in effective safeguards to trigger a review of that decision at appropriate points by the individual, those representing them or the care home. It is important that, as we train and deliver the process, people understand that that is what they should do. A lot of this is not necessarily in the Bill but in the good practice that will follow from it.

A year seemed appropriate to us; it is a well known length of time, it is defined and it is clear. It is also a recognition that we are not looking to reassess too frequently people whose condition is ongoing but are trying to deal with them appropriately.

A number of organisations have raised concerns that it will be a case of, “When in doubt, go for 12 months because 12 months is the maximum period available”. As I have indicated, a lot of that depends on the training, the code of practice and the approach that people take. I do not anticipate that we will see that happen except where absolutely necessary. Best interests assessors are critical to that process; their role is to ensure that that is done only where appropriate.

The noble Baroness referred to a default period of a year covering people in a temporary state of confusion. That is categorically not what we anticipate. It is important to approach this from that point of view.

The noble Earl, Lord Howe, raised an issue that runs through a number of the amendments before us regarding family members’ knowledge of the system. I hope that we will return to that theme when debating later groups of amendments and discuss how we make sure that those representing the individual, whether family members or others, can understand and get the information that they need to support the person appropriately.

I think that we have the balance right. A maximum period of one year feels right to me. It is on the condition that this is not a default position and should be used only where appropriate. We anticipate seeing many cases where people’s deprivation of liberty will be for substantially shorter periods. As I have indicated, a lot of this depends on the code of practice, guidance and training that we offer. We intend to make sure that it is crystal clear. I hope that, on that basis, the noble Baroness will feel able to withdraw the amendment.

I thank the Minister for that careful reply. She has in part addressed at least some of my concerns that the period will go on too long. I shall reflect on the response and come back if there are further concerns. Meanwhile, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 63 to 65 not moved.]

65A: Schedule 6 , page 103, line 28, leave out from “representative” to end of line 29 and insert “before any assessment is undertaken”

The noble Earl said: The amendment would ensure that a relevant person’s representative was appointed in time for them to contribute to the assessments as opposed to what appear to be the Government’s proposals for the appointment to be made after an authorisation is granted. The reasoning behind our amendment is that the representative should be appointed when assessments are commissioned, particularly before the best interests assessment is carried out, so that the representative can inform the authorisation process. A person’s representative is likely to be a family member, a friend or someone who knows the person well, who will be in a good position to advise on a patient’s wishes and feelings and especially on their best interests.

The Government’s proposals in briefing documents and the Explanatory Notes state that the representative will be appointed only after an authorisation has been made. On the face of it, that seems at odds with paragraph 125 of Schedule 6, which states that information or submissions from a person’s representative or IMCA advocate must be taken into account during assessments, when doing so would obviously be impossible if a representative cannot be appointed at that stage. A separate paragraph in Schedule 6, paragraph 49(6), deals with future assessments after an authorisation has already occurred, with all the necessary assessments. That also states that information from the representative should be taken into account, so it would be valuable to hear from the Government why a representative should be involved in future assessments for authorisations but not the first one.

The original Bournewood case is often quite instructive. It is not clear at what point in the authorisation process the person who is being deprived of liberty would be enabled to object through their advocate or representative. In the Bournewood case, would HL’s carers, as representatives, have been able to express his objection and ensure that his objection was accepted? That is quite a telling test. The amendment links to the wider issue of the role of family members and the representatives of people in the Bournewood gap. It would be valuable to hear of any further steps that the Government would be willing to take to strengthen the role of representatives in the process. I beg to move.

I gather that available in the Printed Paper Office are the draft regulations relevant to the appointment of the relevant person’s representatives as well as draft regulations for the eligibility and selection of the deprivation of liberty assessors and a statement of intent regarding the other deprivation of liberty regulation-making powers. I draw that to your Lordships’ attention not because it will affect the quality of debate in the Chamber this evening but because it would be useful if noble Lords could reflect on what we propose in the draft regulations and let me know if there are issues that they wish to raise.

The noble Earl raises an important point, and I am checking to ensure that the Bill is correctly drafted. We have sought to say that the crucial person at the beginning of the assessment process should be the best interests assessor, who is appointed with the specific function of ascertaining what is in the best interests of the individual concerned and, in so doing, to take into account a range of views, especially from family and friends.

The noble Earl will know that there can be conflicting and different views, and views from a distance if I may describe them as such, but those will be taken into account. Part of what we are asking them to do is to reflect on whether, having talked with family and friends, they wish to recommend somebody as the person’s representative. In many cases, certainly in the case of family members I have spoken to, it may be very obvious who the person ought to be. In other cases it might not be. It is a very important role. On the first assessment the best interests assessor would consider that and recommend an individual, if there were such a person; then they would take over the role to act on behalf of the individual.

The noble Earl mentioned the thread that runs through a number of these amendments: ensuring that those invited to take on this role receive the highest quality information. Some stakeholder organisations are concerned that professional independent mental capacity advocates are very used to the system and to undertaking an advocacy role but that family members might find it new and difficult. One of the challenges that I need to look at is how we ensure that we level up the playing field and ensure that representatives, who may be family members or friends, can access high quality information and support to enable them to act effectively on behalf of someone beyond their natural desire to do so, having been chosen or decided to undertake that role because of their affection for and commitment to the individual concerned.

Paragraph 125 of the Bill applies to the initial assessments and the review assessments. There would be a representative at the review assessments because, once that person is appointed, he will play a key role in those assessments. Paragraph 49(6) applies where there is consideration of an existing assessment at review or renewal of an authorisation. Again, a representative would be in place. The Bill’s drafting recognises that an individual would be in place at the relevant time.

We have tried to ensure that the best interests assessor plays a critical role at the beginning and is appointed specifically to do that, and that the representative follows on from that process—the best interests assessor playing a key role identifying who that might be—and continues it. We think that is about the right balance, not least because family or friends could hold different views. An independent best interests assessor with the requisite skills is best placed to consider effectively deprivation of liberty; then the representative takes over from there. I hope that I have answered the noble Earl’s point and have at least given him pause for thought. I hope that he will withdraw the amendment.

I thank the Minister for explaining the Government’s position. Of course I take note of it. I am particularly grateful for the elucidation that the Minister offered on the Bill’s drafting. Clearly, I shall need to consider what she has said, which I shall do before the next stage. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

66: Schedule 6 , page 107, leave out lines 7 to 29

The noble Baroness said: At this hour I do not wish to rerun many of the debates that we have just had on the previous amendment moved by the noble Earl. However, as the noble Baroness will be aware, this group comprises probing amendments on the role of the Bournewood case.

I wish to make a point which, the noble Baroness will not be surprised to hear, has been raised by the Making Decisions Alliance and the Mental Health Alliance. On the previous amendment the noble Baroness talked about there being an advocate independent of family members. We understand that. Anybody who discussed the Mental Capacity Act will know only too well that what is determined as being in the best interests of a person who lacks capacity sometimes coincides with the wishes of their family members but sometimes does not.

However, the point that I wish to draw out with these amendments is that it is important that somebody is present who is independent also of the authority making the authorisation. That point was perhaps not reflected in the previous discussion. We are talking about people who are being deprived of their liberty—it is a unique deprivation of liberty given the financial questions which surround it. Whether or not a patient is befriended, it is particularly important that they have access to that independent advocate throughout. That is principally what the amendments are about. I beg to move.

I am grateful to the noble Baroness. The amendments take us back to our previous discussion about the ability of those representing the individual to access the quality of information and advocacy support that I indicated we need to think about, not in the context of the Bill but to level up the playing field more generally.

We recognise the importance of the role that independent mental capacity advocates will play and the critical nature of family members or carers. They can be independent of the care home or the hospital where the individual is being looked after. We do not want to appoint where there is clearly somebody who is able to act in support of the individual. We do not want family members or carers to feel that their role and function is being usurped by professionals. However fantastic those professionals might be, families may find that difficult. One of the features of the Mental Capacity Bill before it became an Act was the number of representations that we received from family organisations concerned that in what we were doing we should not forget them, be they the parents of young people who had long-term learning disabilities or those who cared for elderly people and wished to play a key part in their lives.

We have been quite careful to try to differentiate between those who clearly have somebody who can act on their behalf with the right support, and who will look after the best interests and the needs of the individual very carefully from a position of being their friend or loved one—bearing in mind everything that I have said previously about making sure that they know how to do that effectively—and those who might need independent support because they are not in that position. We should not mix them up in a way that would prevent family members acting in the best interests of those individuals.

That is the right and appropriate way forward. We want to make sure that those representatives are told how to ask for reviews and how to go to the Court of Protection if they felt it necessary, and that support and advice are available to them. We consider that, once we have the person’s representative in place, we do not need the independent mental capacity advocate, whose role should cease because the representative has taken over that function as appropriate. They should be invited and enabled to do so with the right kind of support.

We believe that we have got the balance right between independent professional advice and support in particular cases and at particular moments, and enabling family members, with the right level of support, to act on behalf of their loved ones. When the noble Baroness reflects on the matter, she will perhaps see that we have sought to get that balance right. However, as I indicated, I accept that it is very important to ensure that the representatives can act in an individual’s best interests because they have the information and support that they need.

I thank the Minister for her full reply. I will have to go away and consider it, because we are talking about a unique situation in which the interests of the care home or authority, the family members and the individual are involved. I am not clear about exactly by whom and by what process it is established that a decision is in the best interests of the person when that may be inconsistent with one or two of the other interests. I will study with great care what the Minister said, but perhaps I may ask her similarly to consider my point again. If she can offer further clarification, perhaps in writing, I would very much appreciate it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 66A not moved.]

67: Schedule 6 , page 109, line 29, at end insert—

“Duty to provide a second opinion for serious medical treatment (1) This paragraph applies to a person (P) who is deprived of liberty in accordance with this schedule if an NHS body is proposing to provide, or secure the provision of, serious medical treatment within section 37(6) to him.

(2) P shall not be given the treatment unless a registered medical practitioner (other than the medical practitioner in charge of the care of the patient) has certified in writing that the patient is not capable of understanding the nature purpose and likely effects of that treatment but that it is in the best interests of the patient in accordance with this Act that the treatment be given.

(3) Before giving a certificate under sub-paragraph (2), the registered medical practitioner concerned shall consult two other persons who have been professionally concerned with the patient’s medical treatment, and of those persons one shall be a nurse and the other shall be neither a nurse nor a registered medical practitioner.”

The noble Baroness said: This is a much more straightforward amendment, ensuring that vulnerable patients lacking capacity are not given serious medical treatment without a second medical opinion on its necessity. Where serious medical treatment is contemplated for a person lacking capacity to consent who qualifies for additional safeguards, Section 37 of the Mental Capacity Act 2005 imposes a duty on the responsible NHS body to ensure that support and representation for that person is sought from an IMCA. Examples of the sort of treatment that might be considered serious include ECT, therapeutic sterilisation and withholding of artificial nutrition and hydration.

A significant percentage of those covered by these proposals are patients who would meet the criteria for detention under the Mental Health Act, but for their compliance with the treatment proposed for them, or, indeed, because some may be unaware of their treatment being administered to them. Many others will be receiving medication and treatment for either or both mental and physical conditions. Under the Mental Health Act, there is a statutory second medical opinion procedure for medication beyond three months and ECT. The same safeguards should be replicated here.

I shall assume that the Minister will understand the motivation behind this, because we debated it at considerable length during the passage of the Mental Capacity Act. Where serious medical treatment is to be, and perhaps sometimes needs to be, carried out upon a person who cannot, because of a lack of capacity, consent, we need the highest possible standards and safeguards. I beg to move.

I support this amendment. There is a tendency to think of these proposals as another imminent job creation scheme for doctors. That is exactly how people addressed the second-opinion appointed doctor issue in 1983; it was not welcomed by many. In fact, however, it has been a tremendous safeguard in the Mental Health Act, and has led to senior doctors, who were previously godlike, understanding that they must think long and hard about the best interests of the patient when they are providing care for someone without capacity, as in this case, or who is resisting treatment.

It has led to a tremendously different culture and feel in how we support those with mental health problems. In spite of the amendment requiring resources, which I do not deny, it would give equivalent safeguards and support good practice already in effect in many institutions caring for those with profound learning disabilities and dementia. It would be a positive move.

As the noble Baroness, Lady Barker, said, we debated many of these issues at great length. In preparing for this group of amendments, I went back to the original Act—the noble Baroness may be surprised to learn that I had forgotten bits of it. I listened with great interest to the noble Baroness, Lady Murphy, who has great experience on these issues.

Let me try to set out the position as I see it from the Mental Capacity Act side, as opposed to the Mental Health Act side. My clear view is that a deprivation of liberty authorisation should concern only deprivation of liberty and should not authorise any course of treatment. The provision of treatment to a person being deprived of their liberty should be in accordance with the arrangements and safeguards contained in the Mental Capacity Act as it currently stands.

Section 5 of the Mental Capacity Act requires that any act carried out in connection with the care and treatment of a person who lacks capacity must—I repeat, must—be in the best interests of that person. In addition, Section 6 of that Act places safeguarding limitations on the use of Section 5 when the act in question is intended to restrain the person who lacks capacity. There is no justification for adapting these provisions in respect of people who are deprived of their liberty.

The requirements of the Mental Capacity Act governing decision-making when a person is unable to consent are robust, practical and were subjected to intensive scrutiny in your Lordships’ House. Where serious medical treatment is proposed, there will be a need, in accordance with the best interests provisions of the Act, to consult anyone named by the person, or engaged in caring for them, or interested in their welfare. Also, any donee of lasting power of attorney or deputy appointed by the court would have to be consulted. If there was nobody of that nature whom it would be appropriate to consult, an independent mental capacity advocate would need to be appointed to represent the person’s interests.

I believe that the requirements in the Mental Capacity Act regarding decision-making will achieve what we intend, which is to lead to greater involvement in decision-making by the person concerned—that is a critical part of the Act—ensure that what is decided genuinely is in the person’s best interests and that, as far as it can be, the decision made is similar to that which the person themselves would have made if they were able to.

The additions to the Mental Capacity Act that are the subject of our scrutiny today will provide new safeguards to the human rights of people who lack capacity and are deprived of their liberty. I am sure that decision-making about serious medical treatment for these people should be handled in the same way as for any other person who does not have the capacity to consent.

I resist the amendment because I firmly believe that within the Mental Capacity Act we have tackled the issues that lie at the heart of what the noble Baroness seeks. Effectively, the amendment would mean that a doctor not involved in the person’s care would need to certify in writing that that person was not capable of understanding the treatment proposed and certify that the treatment was in the person’s best interests, when the “best interests” provisions of the Mental Capacity Act would already apply. The doctor would have to consult with two persons professionally concerned with the person’s medical treatment—which would be a little heavy handed in the context of existing provisions in the Mental Capacity Act.

At the end of the day, I am not sure that we achieve more than what we have already achieved with the Mental Capacity Act, which provides suitable safeguards in Sections 5 and 6, and achieves what the noble Baroness is seeking. I hope that she will reflect on that and, of course, we can have further discussions on this issue. I believe that we are achieving the best for people and that we should not make distinctions in the way that amendment proposes.

I thank the noble Baroness for her answer. I am not wholly convinced by it for two key reasons. First, we are talking about serious medical treatment and it would stretch belief somewhat to think that an independent medical capacity advocate would have sufficient medical knowledge in such cases to make a judgment. They may be able to make judgments on whether such a treatment might be likely to be consistent with a person’s past and present express wishes and feelings, but that sort of decision is of a separate order.

The other basis on which I disagree with the noble Baroness is that we are talking about people who are being deprived of their liberty and for whom there would be lesser safeguards than they would have if they were detained under the Mental Health Act. Therefore, I am not wholly convinced by her argument, on the basis either of equivalence or on the capacity of the people who will be making that decision.

I understand what the Minister says about the intent of the Mental Capacity Act, but I am not convinced that it is sufficiently robust to deal with very serious medical issues—issues on which carers and family members may well wish to be consulted. It seems to me that stretching that consultation to people such as independent mental capacity advocates, rather than to those with medical qualifications, is not a sufficient safeguard for people who are deprived of their liberty.