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Grand Committee

Volume 689: debated on Tuesday 20 February 2007

Grand Committee

Tuesday, 20 February 2007.

The Committee met at half-past three.

[The Deputy Chairman of Committees (Baroness Gould of Potternewton) in the Chair.]

Welfare Reform Bill

(First Day)

Good afternoon. Before I call the first amendment I have to tell Members of the Committee that, if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.

Clause 1 [Employment and support allowance]:

1: Clause 1 , page 1, line 5, leave out subsection (1)

The noble Lord said: I shall speak also to Amendments Nos. 2, 17, 103 and 18. What a select band we are in this Room this afternoon. It is particularly nice to see the noble Lord, Lord Morris of Manchester, in his place among us, because he so often puts his parliamentary duties before his health. Clearly his health is such that he can be with us today; I am delighted with that, because he has enormous experience in the area that we are about to discuss.

The first amendment in this group may seem to many Members of the Committee rather aggressive. It is not meant to be. My noble friend and I tabled it to get an early opportunity to hear the Government’s response to some very basic questions. We have heard a great deal, all of which I entirely agree with, about the benefits that we have seen in another place, and I hope will see here, concerning a consensual approach to the difficult issues to be debated, and I hope resolved, during our discussions on the Bill.

Unfortunately, some of the largest issues that I hope to be debated are difficult to introduce, as they revolve around what is not in the Bill rather than what is. Members of the Committee with a better knowledge of Latin than me may remember that Caesar, in his Commentaries on the Gallic Wars—perhaps in volume one or two—commented that men worry more about what they cannot see than about what they can. The Government have been unusually co-operative in laying before your Lordships draft copies of many of the regulations that the Bill will empower, along with extensive explanatory material. I am sure that all Members of the Committee are as grateful as I am for that. Although those have been extremely helpful, the Government have been silent on one of the most important questions that the Bill has raised; namely, what the new benefit levels will be. I hope that Members of the Committee will bear with me as I go through the many questions that arise out of that, which the Minister must surely appreciate.

The basic question obviously has a significant impact on not only new claimants of ESA, but those who must eventually migrate from the old system to the new. The Government have promised that the basic allowance plus the support component will be greater than long-term incapacity benefit. However, I have failed to ascertain whether that is with or without premiums. The notes on the draft regulations suggest that they will continue. If so, for how long? I observe that the noble Lord, Lord Oakeshott, is as confused on the matter as I am, otherwise he would not have tabled Amendment No. 18.

Next—I may be jumping the gun a little—I am particularly concerned about two words in paragraphs 5(2)(a) and 6(2) of Schedule 4. The schedule states that:

“Regulations may … make provision for the purpose of securing that an award of an employment and support allowance that falls to be made on matching terms is made on terms which match in whole or part the award that would have been made in pursuance of a further claim to the existing benefit”.

I would be grateful for an explanation of what “in … part” means in that context. It has been taken by many of the lobby groups as basing all future levels of ESA benefit on the lowest possible measure of the old. For example, it seems that the assessment phase level is set against the lowest level possible of JSA, and that the support benefit is set against incapacity benefit, both being stripped of all premiums, which in reality are significant elements of both benefits. That is especially relevant to the group of disabled people aged 16 to 24. Let us assume that the first day of operation of ESA is 1 April—before noble Lords reach for their diaries, I am well aware that this year 1 April falls on a Saturday but I ask them to bear with me—and let us further assume that it is a Monday. Will a young person on IB on 31 March get the same or less than the equivalent young person who starts his claim on 1 April and, as is hoped, has it completed 12 weeks later?

These questions, in particular, are vital when it comes to migration. This is the area where the Government have given us the least information and I hope that they will be able to remedy that over the next few sittings. There has been much debate over how long migration is expected to take. “As resources allow”—words that are whistling round Whitehall at the moment—is a similarly flexible phrase. There is also much confusion over how claimants will be treated during migration. I understand that those currently claiming IB will not be moved to the lower assessment phase benefit as this will represent a significant loss of benefit for those 13 weeks. However, can the Government clarify whether these migrants will have to undergo a PCA to confirm to which group they will finally be assigned? After all, it is not impossible that the new descriptors will lead to many people currently on the higher level long-term IB being newly assessed as not being limited for work-related activity.

Another complication here is the application of linking rules. A correspondent whom I mentioned on Second Reading has raised concerns over how these will apply. The situation is clear enough with those who are on ESA, but what of migrants? Let us suppose that a current claimant on long-term IB manages to find employment, so comes off the benefit just as ESA is rolled out under him. On losing that job within two years, he should return to a similar level of benefit, presumably as a support component under the new regime. Can the Minister explain whether he will remain free from conditionality, as is the case for new claimants receiving that level of benefit?

Then, to complicate the story even further, let us suppose that after a time he again finds himself employed—again, for less than two years. Will he continue to be returned to the support group? When do the Government intend to require PCAs from these migrants? I suppose that here it is appropriate to mention the employment grant of £40 a month for those coming into work. Will they get several dollops of this, or will it be limited to a 24-month working period or what? I repeat that I am referring to someone who is in and out of work. There is also the possibility of self-migration. In other words, can the Minister confirm that current claimants who are actively seeking to migrate—particularly those with mental health and learning disabilities, who have available greater support, such as personal advisers—are also able to migrate, as the notes on regulations suggest?

Moving away from questions surrounding migration, I return to the issue of where levels will be set. I understand that the basic allowance, as awarded during the assessment phase, will be similar to the basic jobseeker’s allowance—so similar, in fact, that it will be less for young people over the age of 25 but more if they are a couple. Can the Minister explain why these distinctions are being continued into the assessment period when they have been rejected for the period afterwards? That seems illogical. Why, indeed, do the Government want it both ways? Surely it would be clearer and cleaner for them to decide whether a distinction is or is not to be made on the grounds of age.

Another surprise on reading the material is that the Government are planning to continue so many premiums into this new regime for the income-related ESA. Severe disability is mentioned as an example; this seems an unnecessary complication given that the new benefit already has a more generous payment to the severely disabled or ill claimants in the form of the support component. Why does that benefit not already encompass that premium?

I should also like clarification on whether these premiums, presumably along with passported benefits such as free prescriptions, will be extended over the assessment phase for new claimants. The explanatory material seems to suggest that they do, but how will that be managed? Claimants will not yet have been assessed as to the need of any benefits relating to their disability at that point.

There is also the question of child-related premiums and passported benefits, such as the enhanced disability premium or free school meals. Of course, I can understand the need to continue with the premiums while that area is reformed, but I hope that the Minister can reassure me that premiums will be withdrawn as soon as possible and absorbed instead into what is undoubtedly—or will seem so, when I have had the explanations that I have asked for—a new, simpler benefit.

I appreciate that this is a very long list of somewhat disparate questions, but a complete set of answers will save much time later, which is in everybody’s interest—always supposing that I remember the answers given by the Minister. I beg to move.

I shall restrict my comments to Amendment No. 18 in this group. We are in the process of trying to get clarification and probing, and here we are exploring what will happen to the premiums in income support and how they will be dealt with. In other words, will anyone lose out on this? Clarification on this point will help us find out exactly what the situation is, and I hope that the Minister’s answer will allay certain fears that undoubtedly exist out there, because we simply do not know exactly what is going to happen.

There is not really much else to say here other than that there are fears and worries related to the changeover. Can the Minister assure us about what will happen, where it will be regulated and how soon we will see it in its correct form? If so, he will deal with most of the concerns on this matter. I look forward to his answer.

I shall start in the same vein as the noble Lord, Lord Skelmersdale, by acknowledging the expertise in the Room today. There are people, including my noble friend Lord Morris, who have been engaged in these matters for many years, and the approach taken in the other place, at Second Reading here and in the engagement since bodes well for the issues that we have to address.

As the noble Lord, Lord Skelmersdale, said, these amendments are designed to explore the Government's intentions regarding the rate and payment of the employment and support allowance, for both new and existing customers. Pathways to Work pilots have already demonstrated that, with the right help and support, many people on incapacity benefits can move back into work, reinforcing our view that labelling people on incapacity benefits as incapable of work is wrong and damaging. This, coupled with the complexity and structure of incapacity benefits, works against our intention to help people focus on their aspirations.

Our intention, as your Lordships know, is to replace the current system of incapacity benefits with the new employment and support allowance. Unlike current incapacity benefits, the new allowance will rightly focus on how we can help people into work and will not automatically assume that because a person has a significant health condition or disability they are incapable of work. We believe that that is the right approach, which has been broadly welcomed by many organisations representing people with ill health and disabilities as well as by Members of this Chamber on Second Reading and throughout all parties in the other place.

With your Lordships’ agreement, I shall address some of the issues more fully and seek to answer each of the questions that has been raised. Amendment No. 1 would remove the first subsection of Clause 1, which introduces the new employment and support allowance and establishes that it will be payable subject to the provisions of Part 1. This is a fundamental part of the Bill which is essential in establishing a new system of hope and support to help give sick and disabled people the opportunity to make the most of their capacity.

Amendment No. 2 seeks to remove Clause 1(3)(e) and (f). These paragraphs set out that for a customer to be entitled to employment and support allowance, they cannot simultaneously be entitled to income support or jobseeker's allowance. The amendment, as I understand it, looks at our intention regarding entitlement to employment and support allowance and the possible additional access to other income-related benefits. Indeed, the noble Lord confirmed that.

The new employment and support allowance is not structured in the same way as the old incapacity benefit, where incapacity benefit may in certain circumstances be topped up with income support. Instead, employment and support allowance is an integrated benefit, where a customer need apply only once and can, if necessary, receive both strands of the allowance.

As the noble Lord recognised, no final decisions have yet been made on the exact rate for the main phase of the benefit. However, as the Government have previously made clear, the main phase rate of benefit—the basic allowance for someone on the contributory benefit or for a single person on the income-related benefit plus the work-related activity component—will be higher than the current long-term rate of incapacity benefit, and those on the support group will receive a higher amount. Above that rate, people in the most financial need will continue to receive premiums such as the enhanced or severe disability premiums, where appropriate.

For some people only one benefit will be available. However, for others there will be a choice. For example, a lone parent who also has a disability may be able to claim either income support or employment and support allowance. In such circumstances, we believe that a customer should only be able to claim one of the two benefits. To be paid two benefits at once would lead to duplication of provision, creating an inappropriate and significant burden on the taxpayer. The purpose of these paragraphs in Clause 1, therefore, is to ensure that that does not happen. This is common to other social security legislation, such as the jobseeker’s allowance.

However, noble Lords will know that in the current system income support is not the only source of help that the Government provide to people on low incomes, and we intend to bring similar provisions forward for people on ESA. For example, people on income-related ESA will have automatic access to full housing benefit and council tax benefit; and we expect that customers on income-related ESA will also have access to a range of other passported benefits, such as prescription charges or free school meals. The noble Baroness, Lady Thomas, has tabled a separate amendment on these issues, and I am sure that we will discuss them in more detail later.

I turn now to Amendment No. 17. Clause 4 provides for the calculation of the applicable amount, which is the amount of benefit a customer will receive if he, or his partner, has no income. If they do have income, the applicable amount will be reduced by the amount of that income. I believe that the intention behind Amendment No. 17 is to probe our intentions, rather than to remove the amount altogether, which of course would be the effect of the amendment.

As I have already said, the applicable amount for income-related ESA includes the personal allowance for the customer and any partner and, from the 14th week of the claim, either the work-related activity component or the support component where the PCA is satisfied. The applicable amount also includes the enhanced disability premium, severe disability premium, pensioner premium and, where appropriate, the carer premium. It will also include certain housing costs such as mortgage interest and service charges, which are currently payable as part of income support.

Turning to Amendment No. 18, I recognise the concerns noble Lords have about the benefit position of disabled people who would previously have qualified for the disability premium. However, the employment and support allowance introduces a new structure to the benefits for people with limited capability for work. That cannot be compared directly with past systems. Where a customer meets the personal capability assessment threshold, the new benefit provides that, after an initial assessment phase of 13 weeks, a work-related activity component or a support component will be payable. We should recognise that for most people that is considerably earlier than under the current arrangements, where the higher rates of benefit are payable after a year of incapacity.

This amendment means that the disability premium will continue to be payable in addition to the work-related activity component or the support component. In our view, the new structure of ESA better supports our aim of encouraging people with a limited capability for work to engage in work-related activity where they can. In addition, disabled people with additional needs will still have access to a range of appropriate income-related premiums, as I spelled out. The new arrangements provide that many people will receive additional support far sooner than under the outdated arrangements of the past.

Amendment No. 103 removes paragraph 5(1) of Schedule 4, which allows us to apply the linking rules to people leaving the benefit under prescribed circumstances and then returning to that benefit within two years. At Second Reading, I was clear that people migrating to employment and support allowance as part of the mandatory process from the existing system would maintain the same cash level of benefit.

As has been made clear during the passage of the Bill, it is our intention that, over time and as resources allow, existing incapacity benefit cases will be migrated across to the employment and support allowance, so that they too may benefit from the new complementary structure of benefit and support, which will also help to smooth administration and reduce complexity.

We want to migrate existing customers on to the new regime as resources allow, but we need to do so in a controlled manner. Therefore, we do not intend to start the mandatory migration process immediately at the commencement of the employment and support allowance. This is consistent with previous changes of this scale and will allow us to make sure that the new process is bedded down, to make sure the migration is as smooth as possible for customers and to reduce the risks around such a large undertaking.

We believe that it is right to migrate first those with children and those who have been on benefit for the shortest time, as we want to help families with children return to work to lift them out of poverty and to prevent long-term benefit dependency before it arises. However, depending on what evidence comes out of the Pathways to Work extension pilots, before we begin migration we will of course refine and if necessary change this strategy in line with the evidence we have. In the interim, as has been the case in all the Pathways to Work pilots from their inception, anyone already on incapacity benefits may volunteer for any appropriate support we offer.

We propose that, until the mandatory migration process starts, existing customers will remain on their current benefit and current linking rules will apply. Therefore, if someone leaves incapacity benefits they will return to their current benefit, as now. However, once the mandatory migration starts we will be in a position to provide the complementary support provided by the employment and support allowance to existing cases, so at that stage it would be appropriate for people returning to benefit on linking rules to return to employment and support allowance, but they would return to the same level of benefit as they left.

We believe that our approach with the new employment and support allowance is right. These amendments add nothing to the Bill as drafted. Powers elsewhere within Part 1 provide for the entitlement to the new allowance. They enable us to move away from a culture of incapacity and despair to a new regime of rights and responsibilities, where there is opportunity for all.

I shall seek to answer some of the residual questions from noble Lords. If I fail to cover them, I hope noble Lords will press me on the matter. On the issue of linking rules and existing cases, until the mandatory migration process starts, the current linking rules will apply to existing customers. If someone leaves IB, he will return to it.

I was asked why we are having young people’s rates in the assessment phase but not in the main phase. We have made it clear that we do not want to make any assumptions about a person before the main medical assessments have been satisfied in the first three months of the benefit. That is why the assessment phase rates are based on basic jobseeker’s allowance personal allowance rates. Once in the main phase, customers will receive the same rates regardless of age.

The issue of the PCA for existing customers was raised by the noble Lord, Lord Skelmersdale. We are still reviewing and testing the new PCA and, once that is finished, we will be in a better position to say what is the most appropriate stage to introduce it for existing customers. We expect that it will be at the first PCA review following migration to the ESA.

It has been suggested that our policy is not clear, and that there is no new detail. It is not possible at this stage to give every last shred of detail, because I do not want to commit prematurely to something that turns out not to work. However, we need to develop our proposals in line with the evidence.

There were questions about what will happen in the ESA to 16 and 17 year-olds who receive disability premium, and will get the 18 to 24 year-old personal allowance rate at the moment. Many young ESA customers will have access to the higher main phase rate of benefit earlier in the ESA than they would under the current system. It is a question of introducing a balance into these new allowances.

The noble Lord asked what “in whole or part” means in Schedule 4 in relation to matching terms. Schedule 4 contains wide powers to allow us to make sure we can move people smoothly from one benefit to another. Because the structures of the ESA and the IB and IS are different, it is important that we have that flexibility. It has also been clear that we want to simplify rules wherever possible, while protecting customers’ cash level benefits.

I hope that has dealt with each of the points raised, but if noble Lords would please press me again, I will certainly have another go. Subject to that, I urge the noble Lord to withdraw the amendment.

I welcome my noble friend’s comments about, in due course, a mandatory transfer of people on existing IB over to the new employment and support allowance. Will that also apply to the regime previous to incapacity benefit; that is, invalidity benefit? We now have almost an archaeology of disability benefits, and because some of the older ones, particularly invalidity benefit, were sometimes more generous and certainly gave greater security, there is a real reluctance among the holders of those benefits to risk exposure to the labour market, or to anything that seems to suggest that they may not be able to return to their incapacity or invalidity benefit. Instead of seeking to re-enter work, they seek instead to retain their benefit.

I very much welcome my noble friend’s proposals to move all on to the new benefit—that is the only way we will be able to extend the opportunities for supported work and re-entry into the labour market for people who may have been on these benefits for five, seven or even 10 years—but will they also apply to the old invalidity benefit, given that when we introduced incapacity benefit we did not then make any arrangements for moving people across from one to the other?

I am grateful to my noble friend for giving me the opportunity to clarify that matter. I confirm that we intend over time to migrate all existing customers, including those on IVB, on to the new system. As I also made clear, our broad approach to protecting people’s entitlements is that no existing customer will lose out in cash terms. Our principle is then to simplify the system and to bring people on to ESA rules, so far as possible.

I think the Minister will be able to confirm that the premiums will mean no one will lose out in cash terms. My amendment deals with this. Will he confirm that no one is expected to be worse off as a result of transferring to the new benefits? If he will clarify that, we can kill this off and go on to something else.

The position of all existing claimants will be protected in cash terms. They cannot and will not be worse off. Under the new system I have outlined which premiums will operate under those arrangements and how they will do so. The disability premium will not be available because of the new structure of the benefit. We also need to bear in mind, when making these comparisons, that the ESA brings with it not only the cash benefits but also the support that is vital for getting people back into employment and helping them improve their lives.

To come back on that, is it the case that existing claimants are fine, but there is a possibility that the financial situation for new claimants with equivalent conditions will be different?

Yes, it is possible because the allowance will deal with people in a different way. It is a different type of approach. Some people will be better off over a period because they may get access to higher benefits sooner than they would under the existing arrangements.

I stress again that the new rate has not been set and, until it has, it is not sensible to try to draw those conclusions. We have set out very clearly the structure of the new allowance and the support that goes with it. We have made it clear that, in the main phase, the basic allowance will be above the long-term IB rate. That seems to be an appropriate framework in which to consider these provisions.

I am extremely grateful to the Minister. I appreciate that I asked a long list of questions, some of which are dotted around the surface of the Bill. For future reference, if the Minister has his editor’s pencil with him, at the moment none of my amendments is intended to alter the Bill at any stage. However, when we reach Report, and after I have studied the Minister's words of wisdom, the situation may change.

At the beginning of his answer, the Minister referred to the pilot Access to Work schemes—on which all this is predicated, is it not? Some time ago, I asked the noble Lord's predecessor a Question for Written Answer. I asked how many people who had been on these pilots had not volunteered. I will not read out the whole Answer because I knew what it was when I asked the Question. The Answer is “none”. Therefore, in encouraging disabled people to have access to work and to discover what work is all about and so forth, I find it odd that pilots are relied on. Pilots do not prove anything; they merely show that there are volunteers who have had gainful employment and think that they have the opportunity of gainful employment, but they do not do much for the great bulk of people on IB with whom we are concerned.

I do not altogether follow the noble Lord’s argument; nor do I agree with him that Pathways to Work has not been valuable. I do not have the data readily to hand, although they are in the file here somewhere, but comparisons have been made of people in Pathways areas and non-Pathways areas who have reached employment and moved off incapacity benefit, and the process has helped them. Even if you did not have the data to support that, conceptually, looking at what is entailed in all this, it is certain that these processes help people. We are engaging with them in a positive way and helping to deliver on their aspirations rather than paying them for not engaging and forgetting about them.

I accept that but, given that the existing experience is based entirely on volunteers and that the new system will not be, it is difficult to lead one's thoughts directly from the first experience to the second. It is a general point. I suspect that the Government will not find the scheme quite as successful as the results of the pilots have led us all—me included—to believe.

To be clear, the Pathways have been mandatory for new customers with the six work-focused interviews, as they will be under the ESA. There is an opportunity for people to volunteer, just as there will be opportunities for people to volunteer under the new system. There is a mandatory component in the Pathways project.

That makes me even more confused, I am afraid. I shall now have to read out the Answer that the noble Lord, Lord Hunt of Kings Heath, gave me, which states:

“Access to work is a programme that helps disabled people find or stay in employment and has been in existence since 1994. Jobcentre Plus delivers it through a network of business centres”.—[Official Report, 8/1/07; col. WA 19.]

We all know that, of course.

I am sorry to keep interrupting. Is the noble Lord’s reference to Access to Work? That is a different programme from Pathways. I am not sure that we are talking about the same thing.

There is an expression about quitting while you are ahead. Quitting while you are behind is equally valid in this context.

I shall go on to the supplementary questions asked by the noble Lord, Lord Addington. Some of our correspondents have pointed out that the higher rate of invalidity benefit is £80 a week, whereas the average in receipt is more like £90 a week. Therefore, one wonders whether the levels will be closer to the average or the minimum. By the look on his face, the Minister is not prepared to answer that, so I had better move on fairly swiftly.

The answer that I can give is the answer that I have already given. We simply have not set the rate yet, but it will be above the long-term IB rate.

I thank the Minister and shall be satisfied with that for the moment.

The Minister went on to say that there would be no topping up, as ESA is an integrated benefit, but that there would be enhanced disability benefit, if I understood him correctly. I am grateful, too, for that. Is the income support element to lose the disability premium of income support? That worries certain of my correspondents. I am glad to hear that at least some of the passported benefits will be continued—for example, housing benefit, council tax benefit, prescription charges, and presumably eye and teeth tests and those sorts of things. I also noted that the disability premium was to continue.

On the linking rules, I did not quite—

I apologise for interrupting, but I do not want there to be any misapprehensions. The disability premium will not survive under the new arrangements because of the new structure of the benefit, but in the income-related amount the components can include the enhanced disability premium, the severe disability premium, the pensioner premium and the carer premium where appropriate. The pensioner premium is an overlapping benefit in that calculation. Those premiums will survive.

I am grateful for that clarification; I clearly noted it down slightly wrongly.

As for linking rules, I understood the Minister to say that, when there was a break, the customer would go back to the same level of benefit income as they had before they went into work; I hope that I have that one right anyway. However, he did not rise to the challenge of my question about the £40 back-to-work grant or whatever it is technically called; that will suffice for the moment. Clearly, a broken work pattern would mean that people would lose the £40 for periods when they were not in work. Does the £40 continue for 24 months of work activity or do people start again at the beginning of the £40 period when they get back into work, having been off work for a period?

I was interested in the intention to migrate children first, but I would be horrified if the results of the Pathways to Work did not affect the precise way in which the relevant regulation would be drawn and laid when the time came. The Minister looks as though he is poised to answer my question about the £40, so I had better let him do it.

The £40 is for a 12-month period. If somebody goes into work, that starts a 12-month period; if they come out of work, it ceases. If they go back into the system and start work again, the clock starts again on that 12-month period. I stress that the payment is due only when salary levels are at £15,000 and below.

That explanation is very helpful and will be extremely welcome to the various people advising me. I had not appreciated that point; the voluminous papers on the Bill did not make it clear that the grant was for 12 months rather than 24. Never mind.

I am extremely grateful to the Minister. I am sure that we will return to these and linked subjects throughout the afternoon’s proceedings. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 2 not moved.]

Clause 1 agreed to.

3: After Clause 1, insert the following new Clause—

“Service users

(1) This section applies where a person in receipt of employment and support allowance who is a service user is asked by a public, charitable or educational body concerned with health or social care to advise on service standards and delivery.

(2) The Secretary of State may make regulations providing that—

(a) a person who provides advice under subsection (1) shall be treated as having limited capability for work under section 8 in relation to the activities undertaken in pursuance of subsection (1) if he would otherwise be so treated; (b) in the case of contributory allowance or an income related allowance any fee received in recognition of the service undertaken shall be subject to such disregard and averaging as may be prescribed; (c) in the case of contributory allowance or an income related allowance, reimbursed expenses shall be disregarded as income in such cases as may be prescribed; and (d) regulations made under section 16(3)(a) shall not apply in relation to advice undertaken in accordance with this section. (3) In this section “service user” means a person with recent experience of using or requiring public services relating to their ill-health, disability or caring responsibilities.”

The noble Baroness said: Amendment No. 3 introduces a new clause whose purpose is to remove the benefit disincentives to service users who are benefit claimants and who act in an advisory capacity for public services. The new clause states that users of health and social care services who may under the Bill become recipients of ESA and who agree to be involved with advising a health or social care provider should not be treated as fit for work just because of this involvement if the fee paid, plus reimbursed expenses that are treated as earnings, exceeds the current limit.

The reason that this is an important point is that it is an explicit requirement of the disability equality duty, which has been a statutory obligation for public bodies since the beginning of December last year. That duty requires public bodies to produce the disability equality scheme, setting out the actions they will take to address the barriers to equality faced by disabled people within a particular service. Central to the DES’s development is the involvement of disabled people. This is in addition to guidance issued by the Department of Health specifying that service users and carers who use social care or health services must be involved in all parts of the design and delivery of social work education and training. Many of these service users will have severe health or disability problems and are likely to be in receipt of ESA when it is introduced.

It would be very sad if this important and growing group of people were thwarted in performing this kind of public service because they were worried it would affect their entitlement to benefit. When this point was raised in Committee in the other place, the position of local authority councillors was made clear—their position would be safeguarded under the Bill. But the position of service users was not addressed, although the Minister there said:

“We do not—and this is something that we can consider and reflect on in Parliament more generally—have any plans at this moment, as a matter of policy, to extend the deductions to anyone other than councillors. However, it is important to have the power contained in this clause which would enable that to take place, if that became the Government’s policy or any Government’s policy in the future”.

I would be glad if the Minister could address this point when he replies. I beg to move.

I am happy to speak on this amendment and will do so briefly. Refusal to respond positively to it could be self-defeating. All of us here know that charities save the public purse very considerable sums year by year in providing services that would otherwise have to be provided by public authorities; and in any way to inhibit people from helping them could be much costlier than conceding the amendment. This is not to say that cost is the only consideration. Knowing the value of policy initiatives is no less important than knowing their cost. I am sure that my noble friend Lord McKenzie will want to help if he can; if not now, then at a later stage of our consideration of the Bill.

One of my correspondents told me of an individual who is currently in receipt of incapacity benefit but is able to volunteer for occasional days advising her local primary care trust. So it is not necessarily charities with which we are concerned here; it can be any public service of the state or charity or anything else. All other members of her advisory group receive one-off payments for this work but, as this one-off payment is higher than allowed under permitted work rules, she is unable to receive any payment for performing this public service, which seems to me to be a bit silly.

I accept that in many cases there will be a very fine line between work that is therapeutic and work that is done simply as a job. One of the case studies in the not-so-little red book mentioned a part-time job in a gift shop that would be allowed under the earnings rules for income-related ESA. A similar job possibly involving more hours a week could be very useful in helping a disabled person to gain confidence before returning to full-time work. That prompts me to ask how the Government intend to distinguish between regular work and therapeutic work, because it is hoped that both will eventually lead into full-time employment, which is what we are all after.

The amendment seeks to provide powers to disregard payments received and ensure that activity undertaken as part of service user involvement will not be taken into account in calculating benefit entitlement or payments.

The Government recognise the importance of encouraging public bodies to involve service users in improving services, and we are also aware of the concerns that have been raised about how current benefit rules can make it difficult to ensure service user involvement. The noble Lord, Lord Skelmersdale, gave us an example of that.

Employment and support allowance is an earnings replacement benefit, so we have to consider very carefully the effect on benefit entitlement of any activity which provides income. Equally, we have to take into account the effect of that activity on eligibility for benefit. However, it is equally important to remember that ESA is built on the aims of encouraging people to work, to build skills and to increase their confidence. It is essential that we provide an appropriate balance between encouraging participation in public life and protecting taxpayers’ money.

I know that it is argued by some that service user involvement is not work but I do not think that that is a helpful distinction to make. Service user involvement involves many of the skills and activities that people routinely engage in in their everyday employment and ensures that services reflect the needs of the people who use them. In creating any distinction, we would be dismissing the value of service user engagement in helping disabled people to build confidence and develop the skills that would help them into other types of work. As such, service user involvement could count as part of a person’s work-related activity.

Everything that this new clause proposes in respect of treatment of service user engagement can already be done through the Bill. For example, the aim of the amendment could be achieved through the flexibility we already have in Clause 3 where we can regulate for the appropriate treatment of any payments regarding the contributory allowance, including the treatment of expenses.

However, whatever we do must be consistent with the principles underpinning the employment and support allowance. ESA is built on a foundation that people should be encouraged to work, build skills and increase their confidence. We want to encourage participation in public life as part of that, but we think that, as is already the case with councillors, a balance is to be drawn between income from working in and representing their community and avoiding duplicate provision from the public purse.

We want to ensure that people are rewarded properly and appropriately for their contribution and involvement in their communities, and that there is the right balance between benefits for people who are unable to work full-time due to illness or disability, and the income those people can earn. Any changes we make need to be approached with care. We need to understand what the effects would be, not only for service users and public bodies, but, more widely, for earnings rules and work incentives.

While service user involvement is an important activity, we also need to take account of the fact that our goal for many people with health conditions or disabilities is work, and we must not create disincentives for people to achieve that in our enthusiasm to ensure that all members of society can engage in activities in addition to employment.

We also need to make sure that the procedures and guidance properly deal with service user involvement. Some Members of the Committee will know that we have recently announced a change to the rules on expenses paid to volunteers to ensure that people who give up their time when on benefits are not penalised. Alongside that, we have revised the guidance on applying the incapacity-for-work test to emphasise that when people take part in service user involvement they should not automatically be sent for a reassessment. A reassessment should be done only when there are specific reasons for believing the work a customer is doing demonstrates that they no longer satisfy the conditions of entitlement to the benefit. We intend that similar guidance will apply to ESA in the future.

The noble Lord, Lord Skelmersdale, made reference to therapeutic work. The permitted work rules replaced the old idea of therapeutic work, as agreed with the person advised that—oh! I will leave that note to one side as I cannot read it. The question of permitted work rules is important, but in certain circumstances service users would fall outside the rules, but permitted work rules might be a route for some to engage in the manner envisaged.

I hope this reply reassures the Committee that the Government understand the issues the amendment intends to address, and that it is not necessary as the Bill already contains relevant powers. I should also like to reassure noble Lords that, as the Minister for Employment and Welfare Reform said in another place, we are continuing to look for more flexible ways of helping people take up opportunities without fear of their benefits being removed. I therefore urge the noble Baroness and the noble Lord to withdraw the amendment.

Perhaps my noble friend can assist me further. Is the department proposing to issue some guidance—for example, a little leaflet giving advice on what you can do? There are three issues here. First, how much money can you get, given that we are talking about an earnings replacement benefit? There is a clear read-across here to earnings disregard, income support and other benefits. That needs to be clarified. Secondly, the number of hours you are working may seem to indicate your capacity to enter the world of work rather than remain on a supporting benefit. The question there is about the reliability of the hours you can work, the fluctuating nature of your condition—which is one of the big worries behind all this—and whether the work itself will require consistency of hours. The third matter—it has not been touched on but may also read across—is the element of training involved, and therefore potential preparation. That comes up a great deal—for example, whether people are able to go to, say, their local FE college and do a training course of some sort, and how many hours of training they may have before that too is regarded as interfering with their right to a dependency benefit.

Given that this is a very complicated area—it is not just about work, because volunteering it is also about access to FE and related things—will my noble friend assure us that there will be guidance or a leaflet? People will then know exactly where they stand and will not be afraid of jeopardising their benefit status by doing things that are of benefit to them, their families and society.

After that contribution, I feel that we on this side of the Room will enjoy the Committee more than the Minister. Having listened carefully, the longer I listened to the Minister's reply, the more confused I got. If he is saying that we could achieve what the amendment of my noble friend Lady Thomas would achieve by doing things in another way, that does not answer the question asked by the noble Baroness, Lady Hollis. Are you going to do it or not? If we do not have an answer to that, it is not reasonable to ask my noble friend to withdraw her amendment.

To cut the mustard, I understood the Minister to be saying that disregard, permitted hours and the linked activities would not at this stage change. Is that correct?

I have my own particular area of confusion to add. It seemed that what was being indicated was that there would be special rules for councillors. An explanation would be helpful for all of us. I am all for flexibility and lots of areas will be covered here, but are we certain that, in future, whatever exceptions are granted to councillors will also be granted to others in similar situations or to neither? To have exceptions for councillors is odd.

I will try to deal with each of those points. On the specific question about whether there would be any change to permitted work rules, we are due to consider an amendment later about existing rules that we will seek to translate into the ESA. That will be the most appropriate point to discuss that. My noble friend Lady Hollis asked whether we should do more in guidance to explain the rules of permitted work and make it clearer, and the answer is yes. This area is not well understood and we should certainly do that.

The issue of training and the extent to which education features and lessens people's ability to be in full-time, part-time work or training is a complex one. We have an amendment on that coming up and I will deal with it more fully at that stage. At the moment, the specific provisions that effectively disregard the number of hours that councillors spend and reduce the contributory component by some of their allowances are specific provisions. We have no current policy intent to change that. But as I said, we are continuing to look at being more flexible in helping people to take the opportunities available. I am not sure that I can say more than that, but there is consideration of this matter.

This is a very important issue in principle, although the amendment seeks to change an important part of it. The power is clearly within the text of the Bill. The question is whether the Government will take advantage of using that. There are moments when ideas become apt, and the Government should take the opportunity to expand in a sensible way—none of us is thinking of completely throwing open the doors and losing any kind of concept of therapeutic benefit. Still, there must be some idea within the department about what the cost would be of a fresh look, which, together with the sensible suggestion of the noble Baroness, Lady Hollis, could bring about some benefit. If it is introduced as part of this new cultural change—make no mistake, that is what the Bill is—it will be a missed opportunity. This issue, and this amendment, will come up later on in the Bill.

I hope that in Committee the Minister can give us an idea of how much money is foregone in terms of the scheme at the moment, and of how much of the £360 million he is going to roll out in the Bill—a good trick if he can do it—in a sensible way that begins to measure up to the extent to which the pilots were successful, although special circumstances were included in those pilots, such as the way that permitted and therapeutic rules were interpreted. It will be for the benefit of the Committee if he makes it clear exactly what he thinks he can do in future when considering the concept, rather than the fine print, of this important amendment moved by my noble friend. There are issues behind that which deserve fuller consideration in the further stages of the Bill.

On the purpose of the amendment, I emphasise that there are already provisions in the Bill so that the new clause would not be necessary to do anything if we wanted to. For the purposes of clarity, I say that we have no plans to deduct income derived from other memberships or appointments at this time. I tried to cover this point when I was answering the debate. We see the benefits of engagement of people in these issues and in these opportunities, but that has to be balanced with looking generally at the issue of an income replacement benefit and how that works in the system as a whole. That is where we currently are.

I thank all noble Lords who have spoken on this amendment. I never realised it would give rise to such a wide debate as it has. I think this will become very important in the future because of the new duty that I mentioned, which of course is part of the new Disability Discrimination Act. As Pathways is rolled out over the country, I think people will be very concerned, if they offer help in the way that I suggested, if nothing is done.

I was not clear whether the Government were prepared to look at this again. I wonder if I could ask for an assurance whether they might be prepared to have a look at this before the next stage of the Bill, otherwise we will have to come back to it, having examined what the Minister has said. In the mean time I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 1 [Employment and support allowance: additional conditions]:

4: Schedule 1 , page 52, line 41, leave out paragraph (g)

The noble Lord said: The Minister and the rest of the Committee will be delighted to hear that I intend this amendment to be a quickie, compared with the first group of amendments that I had the pleasure of introducing. It is simple and, I hope, self-explanatory. I asked the same question at a meeting that the Minister graciously hosted with his civil servants when we were looking at the very early stages and preparing for Committee. I am hoping, though, to hear from the Government and have on record why those on the income-related strand of ESA are not allowed to take part in any educational training. It seems extraordinary that the Government would actively prevent these claimants pursuing an activity that would contribute much to their self-esteem and, ultimately, their employability.

This also raises questions of consistency. Since those on the contributory-based strand of ESA are able to undertake education, I am expecting that this will become a large proportion of their original work-related activity. After all, new skills allow a person unable to perform his traditional job, perhaps heavy labour, to find new employment in work more suited to his capabilities. I therefore look forward to hearing why the Government seem intent on denying these opportunities to those on the income-related strand. I beg to move.

We on these Benches also look forward to the Government explaining how they propose to deal with this apparent problem and explaining whether people will be worse off. We have touched on this matter already, but one unbreakable thread running through all the contributions on the Bill from these Benches will be the question of who is worse off or who will lose—a question which in general terms I put to the Minister at Second Reading and to which I do not believe we received a satisfactory answer. Clearly, we will return to this matter as we go through the Bill.

As the Disability Benefits Consortium points out, at the moment 16 to 18 year-olds can, while receiving incapacity benefit, attend up to 21 hours a week of education or training that would not be suitable for a person of the same age who did not have that disability. Like the consortium, we welcome this opportunity for the Government to state how they plan to identify students who may be able to benefit from “disabled student” rules under the ESA. We support the purpose of the amendment.

The amendment would change the conditions of entitlement to the income-related allowance. It would remove the condition for a customer not to be receiving education in order for him to be entitled to income-related ESA.

I begin by assuring noble Lords that the condition of entitlement as we intend it to apply is not a blanket exclusion on all forms of education. Education and training certainly have a place within the framework of the employment and support allowance. For many of our ESA customers, some form of education or training may be the most appropriate work-related activity in helping them to move closer to the labour market, and that is precisely the outcome that we want.

However, we have an important duty to protect public funds, and one way that we must do that is by avoiding making double provision. Allowing recipients of the income-related allowance to participate freely in education would be an inappropriate use of public funds in cases where students already received appropriate funding through the education system. Income-related ESA will be aligned with other income-related benefits so that customers can study on a part-time basis without their benefit being affected.

We also make specific provision for certain groups of disabled students to access income support while they are studying, and we are bringing forward that access to benefit into income-related ESA. I think that that is the point on which the noble Lord sought assurance.

I appreciate the noble Lord’s interest in the important issue of access to education for disabled people. That is entirely compatible with our commitment to improve the employment prospects of people who are some distance from the labour market. But we cannot make all forms of education, full-time and part-time, freely available to all customers of the income-related allowance, which is what the amendment would do. I suggest that that would be an inappropriate use of public funds, and I therefore ask the noble Lord to withdraw his amendment.

I have no option but to withdraw the amendment, but it occurs to me that this paragraph is very loosely worded in the Bill. It lists all sorts of conditions for the claimant, and sub-paragraph (1)(g), to which the amendment refers, says that the claimant “is not receiving education”. From what the Minister has just said, that does not mean all education; it means full-time education. Can we amend the Bill so that it reads “full-time education”?

The issue of education and benefits and the question of who can and cannot access benefits is complex, as I have learnt over the past few days in going over the position of students at school, college or university. The broad principle that we are adopting here is to roll forward the current arrangements into the new system, but we also recognise that engagement in education would be expected to feature as part of the work-related activity. The construct allows us the flexibility to deal with those varying issues, which is why it is in that form. If we simply changed the wording to, say, “full-time education”, that would not necessarily fit all the circumstances that we are seeking to address.

I support my noble friend on that. There is a real problem in defining full-time education. There are universities where the formal contact hours amount to only four or six hours a week but the home study associated with them can be anything from four to 40 hours. At the same time, the students may be working 10, 20 or 30 hours a week in order to finance their way through university. My noble friend is right that to put that in the Bill would not be helpful because it would be necessary to define “full-time education”, so it would merely postpone the definition. Guidance about what is training, education or part of a therapeutic work agenda and the advice of the advisers is a more appropriate way forward.

There is certainly a provision about education but, from what the Minister was saying earlier, he does not mean all education. That is my problem. Taking the noble Baroness’s point, education taken for a limited number of hours—part-time training, for example—that does not receive government moneys through the Department for Education and Skills would certainly be appropriate. There should be a definition of what is allowed. It does not have to be in the Bill, but it ought to be in regulations. Clearly, a certain amount of education should and must be allowed.

I stressed earlier that we are looking into the most appropriate way to carry forward the current provisions into the new provisions. That is why we have provisions in the Bill for regulations to do what the noble Lord is seeking.

I am delighted to hear it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 1 agreed to.

Clause 2 [Amount of contributory allowance]:

5: Clause 2, page 2, line 27, leave out paragraph (a)

The noble Lord said: I shall speak also to Amendments Nos. 8, 11, 19, 22 and 25. As I and the noble Lords, Lord Addington and Lord Oakeshott, explained earlier, all today’s amendments are probing amendments. I have tabled my amendments for the reason given earlier by the noble Lords, which is to explore the Government’s thinking behind the low level of benefit given during the assessment phase.

We have already established that migrating claimants from IB will not have to go through 13 weeks of assessment on the low benefit rate because we have been given assurances that migrating to ESA will not reduce the income of those already claiming benefit. That is obviously sensible: a person moving from long-term higher level IB to the support group from ESA would be justified in objecting to a significant drop in benefit for that amount of time.

Given the justification for maintaining the benefit level for migrants over the assessment phase and the current practice of backdating incapacity benefit to the date of claim, can the Government tell us what has prompted this innovation? I cannot think of any reason except to save money. This cost-cutting measure could cause significant hardship to those whose disability leads to costs that non-disabled unemployed claimants do not have to meet. The current system allows any debts caused by the discrepancy between the benefit received while being assessed and the costs of living to be met with the backdated funds once the claim is successful.

My reading of case study 1 in the Explanatory Notes on the regulations is that people will be able to apply for ESA while they are still being paid statutory sick pay. Can the Minister confirm that that is correct? That would go some considerable way to ensuring that disabled people did not have to undergo such a considerable period of restricted benefit. The income from their sick pay would then support them until the support or work-related component kicked in to provide a supplement to the basic allowance. Also, given that SSP lasts for six months, is there any bar on that benefit and ESA both being in payment other than, naturally, the usual total income rules?

I also probe why the Government have decided that 13 weeks should be both the minimum and maximum period of assessment. What exactly is magic about 13 weeks? How was that period chosen? I accept that time is taken in assessing the individual and, originally, in putting the claim through the system, but the fact remains that in many quarters 13 weeks looks like an awfully long time. Having said that, a guaranteed date to which benefit is back-dated once the assessment is complete is only sensible. However, a minimum length will give rise to the extraordinary situation of completed assessments being embargoed.

Do the Government intend to keep claimants in suspense for the whole 13 weeks? I certainly hope not as I am advised that with mentally ill people suspense can lead to stress, then depression—a vicious downward spiral that we should all hope to avoid or, at the very least, keep to a minimum. But perhaps the Government intend that those whose claims have been rejected will move on to JSA, with its accompanying support, as soon as it becomes clear that they will not be eligible for ESA. The Government have already conceded that with many assessments the conclusion will be only too evident. They have explained that those who are too ill or disabled to undergo a face-to-face interview will be moved to the support group on the basis of paper evidence—for example, from their doctor. Are the Government really planning to say that, although they understand that someone is unable to undergo an interview, he must still wait a full 13 weeks before collecting his benefit?

I am sure that the Minister will be quick to reassure me that many of these concerns are the result of a misunderstanding of the Government’s intentions—a favourite word that he used in responding to me and to us all the other day. I look forward to his clarification. I beg to move.

I shall speak to Amendments Nos. 6, 9, 12, 23 and 26 in my name and that of my noble friend Lord Addington, and to the other amendments in this group.

I am not sure that our amendments are probing amendments. I hope that I am wrong, but it was noticeable at Second Reading that when we asked whether people would lose out and not have their claims backdated as they do at present, the silence from the Minister was deafening. I hope that I am wrong and that he can clarify that. However, these amendments would ensure that there is no such delay and that people’s assessments are backdated to the date of their claim if their assessment is successful.

These are all linked amendments with a single purpose. Again, the Disability Benefits Consortium sums it up well in saying that claimants of ESA will get the full rate after the end of the 13-week assessment period and will not get backdated payments. The consortium believes that making people wait on a low level of benefit for 13 weeks with no backdating could create severe and ongoing hardship among many people, especially those coming off sick pay. It sees no reason why it should not be possible to backdate the appropriate rate of ESA to the point of claim, as is currently possible with IB. I think that those points are very fair.

With regard to the effect on young people, the Child Poverty Action Group made very similar points. It said that the Government accepted in their Green Paper consultation report that it was not their intention to penalise young people by aligning the basic rates of main phase ESA with JSA rates. However, according to the CPAG, the Government still propose to penalise young people during the assessment phase by paying the holding benefit at a rate in line with JSA, which will leave some sick and disabled people with inadequate incomes for three months simply because of their age.

If an assessment is completed before the end of the 13-week assessment phase, it is unfair that people should be worse off than they are now. The full entitlement should be paid straight away rather than being backdated. In addition, why should vulnerable people suffer because of where they live and whether the level of efficiency in the assessment process varies? I hope that these are probing amendments but they may well not be.

The amendments relate to the assessment phase of ESA. They would affect our ability to set the level of the components which form part of the amount of ESA in the main phase. I believe that some of them may be intended to seek an assurance about a maximum period between customers submitting their claim and their entry into the assessment phase, including receiving payment of their benefit.

The amendments would effectively remove the assessment phase from ESA. The assessment phase is key to the structure of the new benefit because we want to avoid making any assumptions about people before there has been an opportunity to carry out the necessary assessments. We also believe that it is right for the assessment phase to be fixed at a standard length. It would be unfair for some people to move on to the higher rate of benefit earlier than others due to circumstances such as delays in acquiring appropriate medical evidence that are beyond any customer’s control. In fact, an assessment phase of 13 weeks means that most customers will move on to the higher, main phase rate of benefit sooner than they would see an increase in their benefit under the current system.

The amendments, which I understand may or may not be probing, would also remove very important powers. By removing Clauses 2(4)(c) and 4(6)(c), the powers to set the level of the work-related activity component and the support component would be taken out of the Bill. That would render entitlement to the components meaningless, since no amount of additional benefit would be attached to them.

The purpose of proposed paragraph (e) of Amendments Nos. 12 and 26 is not entirely clear. I believe that it may be intended to seek an assurance about the maximum period between customers submitting their claim and their entry into the assessment phase, including receiving payment of their benefit. It may help if I explain how a claim is made.

When someone submits a claim for benefit, their date of claim is then established. For ESA, we intend to maintain the alignment recently drawn between IB and IS so that when Jobcentre Plus is notified of an intention to claim—for example, through a telephone call to the contact centre—that date can be treated as the date of the claim if the properly completed claim form is then received within one month.

Entitlement to ESA will be dependent on the customer having made a claim for it. Once a claim is made, the first day of entitlement is established, and the assessment phase will start at that first day of entitlement. The relationship between that date and the date a claim is made can vary—for example, because customers can backdate their claim by up to three months. It should also be noted that three waiting days will be served before there is any entitlement to receive ESA after making a claim in a period of limited capability for work.

Let us use the example of a customer contacting Jobcentre Plus on 8 February to make a claim for ESA. When he sends in his completed claim form on 11 February—within one month of the original date—his date of claim is confirmed as 8 February because it was the date of first contact with Jobcentre Plus. However, this customer has been sick since 3 January, so he wants his entitlement to benefit to be backdated to cover the whole period he has been sick. No entitlement to benefit arises on the first three days of limited capability for work—the waiting days—so his entitlement and his assessment phase start on 6 January. This means that he will receive a backdated lump sum for the period since 6 January and he will then be paid as normal. His assessment phase will end on 7 April—13 weeks after 6 January. If his PCA is completed by 7 April and he is assessed as having limited capability for work, he will move on to the main phase and receive the appropriate component. If, however, his PCA takes until 21 April—for example, because he was too ill to attend the first scheduled medical examination—he will stay on the assessment phase rate of benefit until 21 April but then have his main phase rate of benefit backdated until 8 April when the PCA has been satisfied.

We are aware that decisions on the detail of the processing of claims by Jobcentre Plus, which in due course will need to be set out in regulations, need to be made. I assure noble Lords that the process will be fair and appropriate, that it will be designed to improve customer service and that it will be streamlined to drive out inefficiency.

A number of specific questions were raised, especially about SSP and claims for ESA. Customers can make an advance claim ahead of their SSP ending. However, entitlement to ESA cannot arise until the SSP is exhausted. I hope that that clarifies the point for the noble Lord, Lord Skelmersdale.

Does that still mean that the date of claim becomes the operative date, even though it is four months into the payment of SSP?

I think that on that basis the date of claim—the commencement of the assessment phase—would be at the ending of SSP. I believe that that would be the start of the assessment period. People cannot avoid the assessment period by that advance claim.

The noble Lord, Lord Skelmersdale, suggested that we might leave people in suspense for a whole 13 weeks. We will tell people as soon as we can whether or not they have satisfied the PCA. However, they will not move on to the main phase of the benefit until the 13-week period is complete. As I said, that would be unfair. We originally estimated that 13 weeks would be the period in which the majority or a significant number of claims could be satisfactorily dealt with.

There are obviously resource implications in trying to backdate into that assessment phase, but issues also arise in looking at the whole balance of the benefit. I say again that at the end of the assessment phase, when people receive a work-related activity or support-group component, the level of benefit will be higher than the level that they would receive at the same point in time under the existing arrangements. That needs to be borne in mind when looking at the whole pattern of how the process works.

To reiterate, the assessment phase is absolutely key to the new structure of the benefit that we are attempting to introduce with this Bill. I therefore urge the noble Lord to withdraw the amendment.

I think that I am clear about what is supposed to happen in these circumstances, but I have had experience in the past of systems that failed operationally and practically. What is magic about the number 13? That is a very good question. Was it tested in the Pathways to Work pilots in those ambitious periods when personal advisers had to work with incoming and outgoing data? Did those pilots suggest that these were things that could be measured, not only in the specially chosen pilot areas but in downtown Liverpool, Manchester, Glasgow and so on? These are very important questions.

What happens to the clients and their claims if the computers do not deliver on the systems that the Minister is setting out as targets? Will that create the difficulties that we have discussed in policy terms? What happens if the computers do not work and the system fails operationally so that the poor customers, as the Minister calls them—claimants, as I like to call them—suffer because the system is broken?

The information that we have obtained from the Pathways pilots has caused us to determine 13 weeks as the most appropriate period in which to process the overwhelming majority of claims that come in. The noble Lord asks what happens if that is not achieved and the claim is not dealt with and evaluated until after the end of that 13-week period. There will be a backdating of the work-related activity component or the support-group component to the beginning of the 14th week. Clearly, we need to ensure that the systems are efficient and that they deliver within the desired timeframe.

I thank the Minister for reading carefully into the record how he sees the system working in future, but I am afraid that, carefully as I listened, I could not hear an answer to my questions. Unless we can have an answer now, I am afraid that these amendments will not remain probing. It sounded ominous when he said that there would be resource implications if backdating into the assessment phase was pursued. It sounded as though they are trying to save money and as though people will have to wait longer than they do at the moment to go on to the higher rate of benefit by waiting through an assessment period that is not fully backdated. If I am wrong, can he say so? Despite making the points pretty clearly and giving the views of the Disability Benefits Consortium and the CPAG, I do not believe that I got a straight answer. Are these expert people just getting it wrong?

I am happy to try again. It is self-evident that, if you pay work-related activity components or support-group components that are on top of the basic level earlier, other things being equal in aggregate, that is bound to cost more than if you do not.

To answer that question you have to look at the whole of the benefit. I have already said that, if you look at the 13-week period and the time at which the work-related activity component or the support-group component kicks in—and we have emphasised that the former of those would be higher than the existing long-term rate of IB—you would expect that would arise earlier than under current circumstances. Obviously, the assessment phase has a different effect. That comes from an analysis of those timeframes and the components of payments within those timeframes.

I stress again that we have not set the overall level, but we are saying that it would be higher than the existing long-term rate of IB. You have to look at the new arrangement; you cannot simply compare it readily with the old. Also, when you look at the ESA, you are not only looking at the benefit levels; the support package that comes with it is a key part of it. That is why it is structured as it is. In terms of where you draw the line, clearly a judgment must be made and a balance must be struck between the needs of all the customers or clients—call them what you will—who are the people that we should be looking to support and help.

I have a lot of sympathy for this amendment, particularly in relation to the support group, who I understand will be a relatively small group of extremely disabled people. They are likely to have considerable costs attached to their disabilities. Have the Government considered the impact on that particular group of having to wait for 13 weeks before they get the benefit to which they will subsequently be deemed entitled?

That must be taken into account in the generality of the scheme. I stress that people in the support group will be getting a higher component than those who are just in receipt of the work-related activity component. A greater benefit will flow at the week-14 point.

The point of the noble Baroness’s question is that people will not have that advantage until they actually get the benefit. She was saying that, unless the benefit is backdated, the individual concerned will have to live in some way, with all the associated costs of disability, during that 13-week period. With respect, I do not think that the Minister has answered her point.

The noble Lord, Lord Kirkwood, rather pre-empted me; I was going to ask exactly the opposite question. What happens if everything goes swimmingly and the assessment is completed by week nine or 10? As I understand it, this means that claimants have to wait until the beginning of week 14 before they receive the benefit which has been assessed as being due to them. Is that not a contradiction of natural justice?

The noble Lord is right that if the assessment is completed before the end of week 13, the extra arrangements kick in from the beginning of week 14. I stress again that we must look at the generality—the totality—of the package. Paying the enhanced components—the work-related activity component or the support-group component—from an earlier date for some but not for others, based purely upon efficiency of resources in any region, would not be particularly fair either. That is why we have provided for this 13-week period and why we want all those arrangements to kick in from the beginning of week 14.

Clearly, I shall have to consider this in some depth. What the Government are proposing is in many cases the result of thinking that is, to be kind, less clear than usual.

If there are any points that I can clarify for the noble Lord, I shall be happy to do so. What is he not clear about?

If my noble friend explains the difference in levels of support under the current system of SSB, short-term IB, the higher rate short term and the higher rate long term compared with the new system that will be introduced, the noble Lord, Lord Skelmersdale, may find that people will be better off under the new system—particularly the 80 per cent who will be entitled to support allowance.

As progress has been fairly slow so far, perhaps I could suggest that that is done in writing. That would be much easier and clearer for everybody. In that spirit, I would not press our amendments, although, to follow the noble Lord, Lord Skelmersdale, in using the classics, certainly not sine die.

I will certainly write to noble Lords so that we can try to put this matter to bed. Under existing arrangements, the incapacity benefit does not rise to the higher rate for most people until after week 52. For some people, there will be an interim rise at week 29. This is what we have to consider when making the evaluation. The ESA rises after week 13, which is the point that I have been trying to make, perhaps inadequately. I am grateful to my noble friend for helping me to elucidate that point.

I am sure we all understand that now. However, should the assessment be completed early, there would still be a waiting period before the due benefit was paid. I certainly accept the suggestion of the noble Lord, Lord Oakeshott, that the Minister should write to us on this and I am grateful for the Minister’s agreement to do so. This knotty matter clearly requires further study from our different perspectives. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 6 not moved.]

7: Clause 2, page 2, line 29, leave out paragraph (c)

The noble Lord said: Amendments Nos. 7, 10, 21 and 24 stand in my name and that of my noble friend. It is probably fairly easy to see why they have been grouped together—they say exactly the same thing. They ask to “leave out paragraph (c)” twice in Clause 2 and twice in Clause 4. Paragraph (c) is always the same. It states,

“that such … conditions as may be prescribed are satisfied”.

Clause 2 deals with amounts of contributory allowance under the new benefits and Clause 4 deals with amounts of income-related allowance.

In Clauses 2(2) and 4(4), paragraphs (a) and (b) read,

“that the assessment phase has ended”,

and,

“that the claimant has limited capability for work-related activity, and”.

The provision in paragraph (c),

“that such … conditions as may be prescribed are satisfied”,

is not Henry VIII—it is probably Henry VII-and-a-bit. What does it mean? To give me an answer, the Minister really has to tell me something along the lines of “X number of regulations will be presented in X way. We will know exactly when they will occur; we will have a reference to them”. It would be much better to have such a provision in the Bill, whereas at the moment we just do not know what it means.

This is supposed to be a document that will be given to the groups that are advising and, indeed, to the claimants themselves. Surely they should know exactly what they are dealing with. The Minister should be able to tell us—indeed, I hope that he can—exactly what this legislation will mean, when it will be presented, and under what process we can raise any problems that we have with it. Otherwise, I suggest that we should press these amendments at a later stage. To be perfectly honest, it is ridiculous to have this wording in the Bill. I beg to move.

These amendments cover issues that are common to Clauses 2 and 4, which relate to the structure of the contributory allowance and the income-related allowance. The amendments would remove our ability to prescribe further conditions of entitlement to the work-related activity and support components.

I stress that at present we have no specific intention to prescribe further conditions of entitlement, but the power to do so in the future is essential to enable us to respond to new developments and reflect changes in the light of operational experience in administering ESA. We need to have the flexibility to take account of wider societal changes in an appropriate way so that the benefit does not fail to serve our customers’ needs or the needs of the public purse. My colleague Jim Murphy, the Minister of State in another place, went back in Committee through some of the history of the past 10 to 15 years pointing out what had changed over that period. That is the environment in which the ESA will operate in the future. We need to have the flexibility to deal with that. Failure to respond to such changes could result in entitlement to the ESA components for customers for whom the benefit was not originally designed. Conversely, the benefit could be denied to those for whom we wish it to be available.

However, we recognise the concerns raised by the Delegated Powers and Regulatory Reform Committee, and we accepted its recommendation that the regulations made under these powers should be subject to the affirmative resolution procedure. I have tabled amendments to that effect for the purposes of this Committee. That will ensure that Parliament has the chance to debate appropriately any future use of these powers and it will also maintain the flexibility that we need to respond to future circumstances.

I hope that that satisfies the noble Lord. Certainly the affirmative process for dealing with regulations should be a further comfort to him. It is not unusual to have such provisions in legislation of this kind.

It is not unusual to use them the other way round either. I think that I am against the amendment because it could be argued the other way around. If the new significant cultural and policy change that we are introducing in the Bill works well, it can be built on. Access to the Pathways to Work mechanism could be extended to people other than those whom the Bill is primarily designed to help; for example, the work-focused gateway process could be widened to a much larger group of clients in the future, should one so choose. I should like confirmation from the Minister that, if this clause stays, it will be possible in future to do that as well.

The noble Lord tempts me to stray into areas where I should not go. I welcome his support on the basic proposition that we are moving into a new era as regards this benefit. We need to recognise that flexibility is required to ensure that we make the most of it.

I thank the Minister for saying that. If I heard him correctly, the affirmative procedure will be brought forward. That is effectively what the Minister is saying.

I referred to the regulations under the provisions which the noble Lord is seeking to delete. We have already tabled amendments to that effect.

That would give us a chance to discuss this further to see whether any further clarification was needed by me or those outside; but that is a satisfactory answer. I hope my noble friend knows that we are just trying to get confirmation that this is the correct way forward. I agree with him: if it works or if it works well at least in parts—I suggest that the curate's egg and history tell us what we are getting and it is just a matter of the quality of the egg—we should be able to progress on that level. With that assurance, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 8 to 12 not moved.]

13: Clause 2, page 2, line 45, after “condition” insert “(or both)”

The noble Lord said: This is a very simple group of amendments, although on the face of it they might not look simple. Following some considerable confusion as this Bill passed through another place, we have now established that the Government intend that the scores for the PCA for mental and physical limitations are to be added together. These amendments seek to put that commitment into the Bill, partly to reassure many who are worried by the possibility that that might not be the case and partly to ensure that there is no policy shift in the future.

A significant number of people have both physical and mental disabilities. Unfortunately, the mental disability is often caused by the strain of the physical disability. Many illnesses have both mental and physical limitations, so the reassurance that these amendments will give will be of great value to many people who would have been severely disadvantaged under the Government’s original policy.

It is also remarkably illogical to pursue separate scoring systems. If a number of moderate disabilities of a solely physical or mental nature are considered to make it more difficult to find a job than just one disability of that nature, why is that not true of disabilities of a mixed nature?

I should like to hear the Government’s intentions on a related matter. Some concern has been raised over how broad the PCAs of migrating claimants will be. If a claimant who is already claiming IB for a physical disability has migrated, will he be assessed for both mental and physical disabilities or just for the physical disability that he is already known to have? It is possible that someone on long-term IB for a physical disability could have developed a mental disability that had never been identified. It would seem sensible to assess everyone fully whether they migrate or make a new claim, especially as the new assessment has significantly different criteria from the old one. I beg to move.

From these Benches, I support the amendments. The Minister made a very welcome announcement at Second Reading that the mental health assessment and physical assessment scores would be combined. As the noble Lord, Lord Skelmersdale, said, it is essential that the commitment is spelt out in the Bill rather than being left to regulations.

I shall leave my other comments on the PCA until our Amendment No. 38 is reached about the physical descriptors, unless somebody brings them into our discussions earlier. I will wait until then to talk about descriptors in more detail.

I know that noble Lords and the disability lobby are keen to ensure that we consider both physical and mental health conditions when deciding whether a customer has limited capability either for work or for work-related activity. I hope that during the passage of the Bill to date we have emphasised the importance of both kinds of conditions. Indeed, a key reason for the review of the PCA was to ensure that mental health conditions received the same weight as physical conditions, remedying an imbalance in the existing PCA.

I will look at the assessment for limited capability for work first; it is dealt with in Clause 8. During the earlier passage of the Bill there was considerable interest from the lobby on whether we would be combining scores for physical and mental health as part of the assessment of limited capability for work. As the Committee will remember, I announced at Second Reading that, having considered this matter further and listened to the arguments put forward by stakeholders, we will allow the point scores for mental health and physical descriptors to be added together. That has been reflected in Regulation 3(3) of the draft regulations for Clause 8, which have been shared with noble Lords. I am very keen to emphasise that point today and to make sure that it is very firmly on the record, if it is not already.

The findings of the PCA review on combining scores were inconclusive. One of the findings is that there is no robust evidence base for assuming that a combination of mental and physical functional limitations causes greater disablement of a person in such a way that we should combine and increase physical and mental scores to allow that person to meet the benefit entitlement threshold. It also found that there were differences of opinion on this matter between the experts involved in the review. Given that we currently combine physical and mental health scores when assessing whether someone is entitled to incapacity benefit, we have decided that we would need more evidence to support any decision to change this approach for ESA.

The amendments proposed by the noble Lord are unnecessary. The use of “or” rather than “and/or” does not limit us to considering these conditions separately, allowing us to combine scores should we wish to do so; and, as I said, the draft regulations under Clause 8 provide for the combining of scores. We do not need to change the wording for that to be enshrined in the Bill.

I will now turn to the assessment for limited capability for work-related activity, dealt with in Clause 9. Although the Clause 8 and 9 assessments are similar in name and are carried out at the same time, they are concerned with different concepts. The former assesses whether a person has limited capability for work, and therefore whether he is eligible for the benefit; and the latter, whether it is reasonable to require him to take part in work-related activity, and therefore whether he is suitable for inclusion in the support group.

The two assessments are carried out in different ways. A person demonstrates limited capability for work if he scores 15 points or more in the test of limited capability for work. As I said earlier, that could include a combination of scores from physical or mental descriptors or both. But there is no direct correlation between a person scoring 15 points or more in the test for limited capability for work and that person being an appropriate candidate for membership of the support group. Limited capability for work-related activity is assessed in an entirely different manner—by the customer satisfying one of 46 functional descriptors found in the schedule to the draft regulations under Clause 9. The levels of functional limitation used in these descriptors, which again relate to either physical or mental functioning, are much higher than many of the descriptors used in the test of limited capability for work under Clause 8. That is because only people who are so severely impaired that it would be unreasonable to require them to undertake work-related activity will be placed in the support group.

Only one of the 46 descriptors needs to be met to qualify for entitlement to the support group. This descriptor could relate to either physical or mental functioning. Where customers meet a combination of both mental health and physical descriptors under the Clause 9 test, they will of course still be determined as having limited capability for work-related activity, but as there is no point-scoring system in Clause 9, the notion of combining scores of any type—physical, mental or both—is not required in the assessment of limited capability for work-related activity. However, we will of course look at the effects of physical and mental functional limitations when deciding whether somebody meets any of the support-group criteria.

The noble Lord, Lord Skelmersdale, threw in a question about migration and the PCA. People who migrate will be fully assessed by the revised PCA at their first review after migration. I hope that that clarifies that point and that I have reassured noble Lords about our intentions. I believe that these amendments are unnecessary and I therefore urge that they should not be pressed.

I am grateful for that. I see on pages 39 to 42 of what I referred to earlier as the little red book that the Government of the day can add the descriptors together to come to a final result, as the Minister said on Second Reading. However, in parliamentary terms, regulations can be altered almost at the stroke of a pen, whereas primary legislation takes a lot longer to achieve, even if one can persuade one’s own Government to find the time. Relying on regulations does not seem particularly satisfactory. As usual, I shall ponder what the Minister has said, but I most certainly reserve the right to come back to this on Report. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

14: Clause 2 , page 3, line 2, at end insert “, or

( ) he is undergoing or recovering from treatment for a serious or life-threatening illness or is terminally ill as prescribed through regulations.”

The noble Lord said: The amendment stands in the name of the noble Baroness, Lady Wilkins, who is unfortunately not able to be here. It was inspired by Macmillan Cancer Support and addresses a series of deeply held concerns about people with cancer whose treatments make them incredibly ill, or even just feel bad, over fluctuating periods. The Minister in another place, Jim Murphy, said that he would not expect people in this condition to be considered to be available for work. It is only sensible that there is some form of guidance about people who are undergoing treatment.

The matters raised here go far further than just cancer patients. This could apply to many other conditions that are treated over a period of time. A database will have to be compiled at some point involving interaction with the health service or expert charities to let you know exactly who will not be able to take part because they are undergoing certain forms of treatment. If the Minister could give us some indication of how that best practice of preparing such a database is going, I would be very grateful. Perhaps the process has already started. Not only cancer patients, but potentially others will be affected. I would be much happier if this could be brought forward to give us some idea of what is happening. The initial group may be cancer sufferers, but the situation will apply to many more people. With advances in medical practice, we hope that others will be able to receive treatment that, although perhaps not necessarily disabling in the short term, will certainly have side effects. I hope that the Minister will be able to give us an insight into the thinking on how they will provide for information to be stored and distilled through the people who are effectively on the coal face doing this interviewing. I beg to move.

Amendment No. 48, which has been tabled in my name, is in this group. In speaking to it, I shall speak also to the amendment tabled in the name of the noble Baroness, Lady Wilkins, which was so successfully moved by the noble Lord, Lord Addington, in her unavoidable absence. I spoke to her yesterday, and I regret to say that it looks as though she will not be returning to us for at least a month. We will miss her expertise in this area.

As the noble Lord, Lord Addington, said, the noble Baroness’s amendment was suggested by Macmillan Cancer Support; my amendment was also suggested by that organisation. The amendments aim to improve provisions to ensure that claimants are placed in the correct group. Macmillan Cancer Support is particularly concerned about which cancer treatments will be considered sufficiently debilitating to warrant being moved to the support group. As the noble Lord said, it is not just cancer patients who may find themselves in this position. There are other diseases and ailments that have just such invasive treatments. I note that the noble Baroness, Lady Finlay, has introduced a Bill on palliative care that covers a wider group of disabilities than just cancer. Although we all welcome the Government’s proposals that terminally ill patients and those undergoing certain invasive forms of chemotherapy will not be subject to conditionality, Macmillan is concerned that the assurances are not wide enough. In particular, radiotherapy and non-invasive forms of chemotherapy can be just as debilitating and can result in a patient being unable to undertake work-related activity. There can be added complications, such as a high risk of infection. Given the difficulty of predicting the side effects of many of these treatments or of anticipating the disabling fatigue that many patients suffer, can the Government assure us that they will consider including people undergoing active-type cancer treatment as well as terminally ill patients in the support group?

My amendment was designed to raise many of the same points. In particular, I would like to clarify a few points about the frequency of the PCAs. I understand that the time before the next PCA will be decided at the previous PCA. Is that correct? Can the Minister expand on how much flexibility the assessors will have in deciding how long it should be before the claimant is reassessed and what criteria they will use to select an appropriate length of time? Without a fair and transparent system of reassessment, claimants are in danger of being consigned to the support group without the encouragement and incentives of work-related activity from which they would benefit or of being subjected to needless and stressful PCAs at arbitrary intervals. There is a fine line to be drawn between those two possibilities, and I would be interested to hear where the Government intend to draw it.

I support the amendment tabled by the noble Lord, Lord Skelmersdale. He knows that I have spoken about ME/CFS in the context of social security benefits for many years. The way that ME patients have been treated for many years is disgraceful. I cannot say anything less than that. ME groups have been negotiating new definitions for chronic fatigue syndrome and ME with the Department for Work and Pensions for some time, and they seem to have hit a brick wall as the DWP has arbitrarily withdrawn from any further negotiations. I believe I sent the Minister papers on this some time ago. The difficulty is that people who have severe ME are not being taken into account. When they have severe ME, they are bed-bound and need constant care. They are not lying in bed because they do not like work—we have had this debate before—but because they are seriously ill. I know that the DWP says that the illness may be progressive in some patients but is not life-threatening, but there have been a number of deaths from ME, including suicides and deaths from “natural causes”. It is life-threatening if it gets bad. If patients are made to undertake the treatment recommended, we know that there have been cases where there have been problems. I support the noble Lord, Lord Skelmersdale, on Amendment No. 48. It is important that it is brought into effect.

I shall pose a couple of questions on this important group of amendments. They relate to the experience garnered from the pilot Pathways to Work projects. How did the exercise of discretion work in these circumstances? Has any knowledge gained from how that discretion was used been brought to bear on the proposals going forward? It is important to know whether there is enough statistical data from which to make sensible predictions. In my experience, the case loads that personal advisers are dealing with lead them to conclude that everybody gets the same kind of treatment. Discretion takes extra time and involvement and the caseloads that the advisers are dealing with, even in the pilot projects, are stretching. That is bound to get worse as the programme unfolds across the rest of the country, and this is potentially a particular vulnerable group of claimants and clients that needs very special consideration.

Has anybody done any risk analysis or cost-benefit analysis of what it would cost to issue the blanket exemption that Macmillan is asking for? I do not think that it would add up to an amount that would make a significant strategic difference to the implementation of the proposals in the Bill. The Committee might like to have some sense of it. It might be difficult to pin it down to a specific sum of money, but the department must have a ballpark figure that would give it a sense of what it would cost to concede this amendment. If I am wrong about that and it is a strategically large number, the Committee would want to look at it again. The case that has been made to me is persuasive. Failing safe with this client group is the right thing to do, and I would need powerful evidence to suggest that the Government should do otherwise. I hope that the Minister will look carefully at this group of amendments and will go back to his advisers and ask them more questions, particularly about the cost and the capability of caseworkers who are handling a big case load to apply discretion in the case of this vulnerable client group before he can be satisfied that the clients will not suffer at the hands of this new system in an untoward way.

These amendments focus on access to the support group and specifically on ensuring support group status for those undergoing treatment for cancer and those suffering from fluctuating conditions. While I am on the subject of the support group, I should take the opportunity to clarify a statement I made at Second Reading in response to a point raised about people undergoing cancer therapy. I said that there would be no automatic process on to the support group because 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. As the Committee knows from the draft regulations, we have made provision for a limited group of people, including those who are terminally ill and people undergoing parenteral chemotherapy for cancer, to be treated as having limited capability for work-related activity.

Amendment No. 14 is concerned with those undergoing treatment for cancer. An individual who is found to have limited capability for work-related activity will be placed in the support group. People in this group will not have to participate in work-focused interviews or undertake work-related activity as a condition of receiving all of their employment and support allowance. The criteria for determining limited capability for work-related activity will not be based on specific health conditions or disabilities, but will focus on how severely these conditions impact on an individual’s ability to function. We believe that this will be a fairer way, as conditions can affect different individuals in very different ways. It also means that we will look at what each individual can do and at what it is reasonable to require him to do. These criteria will be detailed in regulations under Clause 9, and the Committee has seen draft copies.

However, we do accept that there are circumstances where it would be sensible to allow entry to the support group even if the individual does not have limited capability for work-related activity. Paragraph 9(a) of Schedule 2 allows us to make provision in regulations to treat certain groups of people as automatically having limited capability for work-related activity. Our draft regulations include provision for people who are terminally ill and for those who are undergoing certain forms of chemotherapy that we know to have disabling side effects in all people receiving them. It would clearly be unreasonable to require people to take part in work-related activity in the final few months of their lives. Equally, it would be wrong to require people undergoing treatment which in and of itself is likely to cause severely debilitating effects on all people undergoing it, to do so.

This does not mean that people receiving other forms of treatment will not be placed in the support group. We recognise that other forms of treatment can be equally disabling for many customers, although not necessarily for all of them. That is why we will consider each individual’s circumstances and the way in which his treatment is affecting his functional ability when looking at whether he meets one of the descriptors in the schedule to the regulations under Clause 9 in order to determine whether he should be placed in the support group.

Regulation 3(2)(c) of the draft regulations also makes provision to treat people as having limited capability for work-related activity if engaging in such activity would pose a substantial risk to their physical or mental health, even if they do not meet any of the descriptors. We will consider this factor on the basis of the circumstances of each individual and because we want to treat each person as an individual there will be additional flexibility for personal advisers to defer interviews where appropriate. The draft regulations set out that an interview can be deferred where it would not be of assistance to the customer or appropriate in the circumstances. This is likely to be the case where someone is undertaking treatment for cancer.

I am also aware of the concern that has been voiced about people whose condition fluctuates in severity over time, and I know that there are concerns about whether the current or revised PCAs will accurately assess the overall capability of such people. It is important to take account of a person’s condition over a period of time, not just on the day of the assessment, otherwise we would not have a full and clear picture of the person’s functional abilities and limitations. I assure the Committee that the PCA is not a snapshot of a customer’s condition on the day of the assessment. It already takes into account the effects of a person’s condition over a period of time when assessing whether he is able to carry out any of the activities set down in regulations. Using their medical skills and knowledge of the course of illnesses or disabling conditions, healthcare professionals carrying out the PCA will consider how the person has been during past periods, how he is on the day of the assessment and how he is likely to be in future periods. So in assessing a person’s entitlement to the support component, the healthcare professional will take account of whether a customer satisfies any one of the criteria, bearing in mind the customer’s condition not just on the day of assessment, but how he is likely to be affected over a period of time. It is therefore unnecessary to include a new clause making provision for reassessment of whether a customer has limited capability for work-related activity.

As I have mentioned, we have also taken powers in the Bill allowing us to defer conditionality for a customer where it is appropriate to do so. We intend to use them to deal with circumstances in which a work-focused interview would not be appropriate at a given time. We anticipate that this will be used where there are short-term fluctuations in a customer’s condition.

The noble Lord, Lord Kirkwood, asked about the cost of the amendment. This is an issue not of cost but of principle. The noble Lord smiles, but the purpose is to try and deal with individuals, to understand the limitations that their disability and health condition have on them, and help them through it into work-related activity. If we add blanket exemptions into the support group, we are at risk of repeating the mistakes of the past. We must ensure that the system is resourced so that those involved can take the time to ensure that the discretion in the regulations can be properly applied.

The noble Countess, Lady Mar, again raised the issue of those suffering from ME. I think that I have dealt with that to a certain extent, but it is an important issue. People with any condition will be assessed on its effect, not on the condition itself. That is an important point that we must make.

The problem with ME is that people can suddenly be tipped from being mildly or moderately affected into being severely affected. That is where my concern lies: people who suddenly become severely affected can be left out of the system, or treated badly.

The noble Countess emphasises a good point. It is obviously important that healthcare professionals are aware of that. I am sure that their expertise would take account of it, but it is important. It is certainly part of the expertise that must be built upon and the data shared, as the noble Lord, Lord Addington, said.

The noble Lord, Lord Skelmersdale, raised the issue of when the next PCA will happen. It will be timed as advised by the healthcare professional, depending on the condition and when it is expected to change. It will be a judgment made in individual cases.

Reverting to the arguments of the noble Lord, Lord Kirkwood, on whether people have the time to look at individual cases promptly, we visited the Pathways to Work programme at Basildon a couple of weeks ago. We saw some data on how they had been dealing with the situation. Some of the condition management arrangements were truly impressive, specifically tailored to the individuals and moving them closer to the workplace in a profound way. I certainly encourage anybody who has not had the chance to engage with these opportunities to do so, so that they can see the impact upon people up close.

I have perhaps not dealt sufficiently with the issue raised by the noble Lord, Lord Addington, on the availability of data and how best practice is to be shared. There is probably no quick answer to all of that. It is like any situation in which services are being delivered: you need to ensure that there are processes in place to share expertise and best practice. We will be coming on to the contractors later in Committee, and how they will ensure that best practice is used and properly shared. However, it is quite a wide issue, and that answer is probably inadequate for the moment. Perhaps we might seek to address that in more detail at a later stage. Accordingly, I hope that the noble Lord will consider withdrawing the amendment.

I should like to press the Minister on behalf of my noble friend Lord Kirkwood. I am sure that he meant no discourtesy, but he was very cavalier in the way he dismissed what I thought were perfectly reasonable questions about cost. In debates on previous amendments on the assessment phase, the Minister was quite happy to talk about resource issues. To some extent, where the dividing line is drawn is not a great issue of principle; it is a bit of a trade-off, and while I do not expect him to have the figures at his fingertips, I would have thought it perfectly reasonable to ask him to write to my noble friend Lord Kirkwood with some indication of cost.

May I add to the Minister’s burden, if he is going to write me a letter, to which I look forward? I found his invitation to Basildon irresistible; will he confirm that Basildon is part of the pilot project and has been doing this work for a long time? I will be delighted if the roll-out of the programme eventually gets every position across the country into the same position as Basildon in terms of the case loading. If I am to receive a letter about money, thanks to my noble friend, could I also have one about case loadings in Basildon and the case loading going forward when Pathways is rolled out across the United Kingdom?

The noble Lord is quite right; Basildon was one of the earlier pilots. I do not have the case load details to hand, but we will see if we can provide them. On costings, it will come as no surprise if I restate the truth. The rate of allowance has not been set, and until it is, it is impossible to provide the sort of costings the noble Lord seeks. I revert to the genuine principle here: we are not looking to consign people to a support group when they do not need to be in that group. We want to engage with people in the widest possible way so that we can help and support them. It seems quite wrong to put everyone who is undergoing treatment for cancer in that support group. We have probably all had family circumstances which have been impacted by that dreadful challenge, but it affects different people in different ways. It does not inhibit some—indeed, quite a lot—of people who are undergoing the various stages of treatment from being involved in work-related activity, even if they are not in work itself.

The noble Lord is an accountant and will be well aware that costs are calculated by multiplying the numbers affected by the amount per person. We accept that the rate has not been set, but can he at least write to my noble friend with the numbers involved?

This has been an interesting debate which has gone quite wide of the wording of the amendment, and has probably been none the worse for that. I should have mentioned in my opening remarks that the amendment of the noble Lord, Lord Skelmersdale, probably encapsulated the primary thrust of my speech rather better than the one I spoke to. However, that is by the by.

My main point is about trying to ensure best practice. If the Minister could give me an example of how best practice is being disseminated among the support groups on this issue and models of it in other places, many of my concerns about the implementation of the process would be addressed. If he could give me an idea of the ongoing process of how it is being done, such as the database and the contacts that will be needed in this and other fields, that would be very helpful. Having said that—and I have the impression that we have touched on matters that might be raised in the next group of amendments—I intend to withdraw the amendment.

I shall write to the noble Lord on that point and give him as full a reply as I can. It is a very reasonable point and deserves a full response.

That is a better response than I had thought or hoped for. I thank the Minister for that, and I hope that we will be able to progress with greater speed on that and on later parts of the Bill as a result of this exchange. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

15: Clause 2 , page 3, line 2, at end insert—

“( ) For the purposes of this Part, the assessment phase for a person who is terminally ill as prescribed through regulations will be waived.”

The noble Lord said: We have established over many years that once an amendment is on the Marshalled List it can be moved by any noble Lord, unlike a Starred Question, which has to be moved with the approval of the person who originally tabled it. On that basis, I will move the amendment tabled by the noble Baroness, Lady Wilkins, and speak also to my amendment. They are almost identical in effect, despite being targeted at different parts of the Bill. They are both designed to shorten the assessment phase in the case of terminal illnesses so that the full benefit might be enjoyed sooner. Sooner is the point, because listening to the discussion on the last group of amendments prompted me to think that it is one thing for terminally ill people to be put automatically on a support group, as the Minister says, but it is quite another thing for them to be fast tracked on to the support group. The question remains at what point they will get on to the support group. I hope that the Minister might have an answer for that. Anyone who is terminally ill is in a very vulnerable situation, and so is their family. The situation should not be made worse by money worries. They should not be made to wait for their benefits once it has been decided that they are in the position that these amendments describe.

The Government have given us welcome assurances on this matter in another place, and they have accepted that 13 weeks will represent a significant proportion of the amount of time left to a person suffering from a terminal illness. There might also be significant costs, as I have said, such as hospice care, which would not be covered by the reduced benefit available during the assessment period. I am interested to know exactly how the Government intend to help these claimants, if not by means of something similar to one of these amendments, by some other means. I beg to move.

I support the amendments. Natural justice is being served by trying to bring this into the Bill. If the Minister could give us an assurance that someone who has a diagnosis of being terminally ill gets straight to the front of the queue, the Committee would be well served.

I thank noble Lords for speaking to the amendments, which cover a sensitive topic that was raised during our Second Reading debate. Ministers and officials have met MPs and Macmillan Cancer Support to discuss these issues in an effort to find the best way to support this group. Where people coming on to ESA have been diagnosed with a terminal illness and have a life expectancy of no longer than six months, we agree that it would be unfair to expect them to go through a three-month assessment phase before they receive the higher amount of benefit available in the main phase.

That is why we have decided to fast-track terminally ill customers through the assessment phase, so that they can get the support that they need quickly and with the minimum fuss during what will be a hugely stressful time for them and for their loved ones. We will use the powers that are in the Bill to provide in regulations that customers who are terminally ill will receive the support component from the beginning of their entitlement rather than after an assessment phase. We know how important it is for this group to receive the best service that we can offer, and we know that this decision will be welcomed both here and in another place. We thank all our parliamentary colleagues and other organisations who have contributed to the debate on this issue. We continue to work on the details of the policy. With the assurance that terminally ill customers will not have to serve an assessment phase, I urge the noble Lord to withdraw the amendment.

That is welcome as far as it goes, but only as far as it goes. I am delighted that there will be backdating to the beginning of the entitlement phase, which I think were the Minister’s words. That presumably does not mean the date of the claim. I assume that it means the point at which a rapid assessment, maybe in weeks three or four, has been made. Have I got the wrong end of the stick? If so, I am sure that the Minister will tell me.

I am awaiting a prod from the Box. My understanding is that it will be ab initio, from the date of the claim, but I hope the noble Lord will bear with me for just a moment. Indeed, it may not be the date of the claim, because there could be some backdating involved. If the condition arose before the date of the claim, there is an opportunity to backdate for three months. For practical purposes, however, we are talking about the date of the claim, from the point of entitlement.

That is exactly what the Minister said the first time. I am trying to establish the point of entitlement.

I shall be as clear as I can. It is the date of the claim unless there is a backdating entitlement. If there is such an entitlement, the date would be sooner than the date of the claim.

Earlier than the date of the claim. Practically speaking, you could not have paid before the date of the claim, but effectively there is no assessment period. That is our intent.

That will be very welcome to all of us and the various people who have been advising us on this series of amendments. I am delighted to hear it, and I certainly beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 2 agreed to.

Clause 3 agreed to.

Clause 4 [Amount of income-related allowance]:

16: Clause 4 , page 4, line 10, leave out paragraph (b)

The noble Lord said: In speaking to this amendment, I shall speak also to Amendment No. 89. My noble friend and I tabled these amendments to probe the Government’s policy on how claimants will move off the ESA when finding work, because that is clearly the ulterior motive of the whole operation that we are considering. I understand that the £40 a week return-to-work grant is very helpful for those adapting to employment after a long absence. It has been mentioned to us that the end of that grant after one year can come as quite a shock. A beneficiary will by then have settled into employment to a considerable extent, and might—indeed, we hope, will—be earning a higher level of wage to compensate. Those higher earnings, however, could then start counting against other benefits, which the return-to-work grant does not. Do the Government have any ideas about how to soften that shock, perhaps by introducing a taper at the end?

Another piece of information that we have not yet acquired is the disregard level that is to be set for those earnings. What are the Government’s intentions here? How high will they set the disregard for this new benefit? Do they have any intention to change the 16-hour rule—we had a little discussion on that point earlier, but I did not get what I would regard as a full answer—so that claimants can work a part-time job and yet still have access to support, albeit with some sort of claw-back if appropriate with the ESA? I beg to move.

The income-related employment support allowance replaces income support for people with an incapacity or disability. It takes account of a customer’s and their partner’s income and capital in determining the amount of benefit payable. It is not just payable to those with no income, but to those with a small amount of income that needs to be below their applicable amount. Not all income affects benefit entitlement, and some income, including earnings, may be disregarded in full or in part. For example, in the case of income support, disability living allowance is entirely disregarded, whereas earnings in excess of £20 per week reduce entitlement for people who are entitled to the disability premium.

The Government regularly review the level of the earnings disregard in the benefits system, taking into account a large range of relevant factors, one of which is the prevailing labour market conditions. We also need to maintain a balance between ensuring that we do not undermine incentives for people to move off benefits into full-time work, allowing people to try out work to build self-esteem and confidence and to find out what is right for them. In addition, we need to maintain consistency across the benefits system to avoid complexity and help ensure better understanding of the rules by customers and staff alike.

Currently, people on income support who receive the disability premium are able to earn up to £20 per week before their benefit is affected, but people in receipt of incapacity benefit, which has a quite different structure, are for a limited period able to earn up to £86 a week provided they work fewer than 16 hours per week. That is commonly known as “permitted work”. The permitted work rules act as a valuable stepping stone to returning to full-time work, giving customers the opportunity to explore what kind of work is right for them, and should be encouraged. That is why in recent years we have extended the provision to enable more disabled people in receipt of IB to take advantage of the provision.

We recognise that the permitted work rules, which provide a gateway into the world of work and a balance between recognising the worth of work and a safeguard to protect the benefits system, are not as well understood as they could be and are seen as complex and inflexible—we touched on that point earlier. One of the advantages of introducing a unified benefit is that it provides the opportunity to go back to the drawing board and to make improvements which build on the current system.

As we stated in the Green Paper, we want to make these rules even more effective for employment and support allowance, allowing people to try out work, build skills and confidence, and move towards greater independence. That is why we are continuing to look for more flexible ways of helping people take up opportunities and increase their options without fear of their benefits being removed straightaway. It is right that people should be given the opportunity to help themselves whenever they can. However, we also believe that people should not be allowed to claim benefits while working full time. There is an important balance to be struck, and this power will enable us to do so.

The noble Lord asked what plans there are for the £40-a-week return to work grant and whether there are any plans for softening the end of the second year.

Earlier this afternoon, the Minister corrected me when I spoke about two years of the £40-a-week payment; now he is talking about the second year. I am afraid that I am at a slight loss.

To clarify, it is one year. Perhaps I should have said, “any softening at the end of that one year into a second year”. I think that that was the point the noble Lord was making; I apologise to him.

We have no additional plans for the return to work credit. Qualitative evaluation of RTWC pathways pilot areas found that people who expected the return to work credit to expire in the next few weeks were all thinking ahead to how they could manage the drop in income. Some had already taken steps to work longer hours; and some people had purposely not used the payment to help everyday budgeting, choosing to save it or to clear debts, and were not anticipating financial problems. Concern about the impending loss of RTWC was linked with believing themselves ineligible for working tax credit and with perceiving few alternative opportunities for enhancing income. People at least four months from the date of expiry said that they did not want to work longer hours. They thought that they could manage the loss of return to work credit by budgeting more carefully or perhaps investigate the possibility of receiving working tax credit. The evaluation showed that people can live and operate within the change and understand its parameters.

I hope that that has dealt fully with the noble Lord’s points. I stress again that we are continuing to look at more flexible ways of helping people take up opportunities and increase options without fear of their benefits being removed straight away. That work continues.

Why do we not extend the principle of flexibility that the Minister rightly frowns on and give discretion to personal advisers to work with individuals who might be able to move from a very small number of hours of permitted work towards an active labour market situation only over a period of time? Some of the evidence from the pilot schemes suggests that it is difficult to capture progress if you are below the thresholds. If a client or customer—whatever we call them now—is acting in good faith, the adviser could recognise that good faith by giving them more flexibility than is currently in the plan. It might be difficult to tie down in terms of the regulations that would permit it. However, my experience is that if you can engage the interest of someone who is willing to try work, even at a very restricted level, such as a few hours a day or even a week, with the intention of building that up, and if the personal adviser thinks that that goes with the grain of what we are trying do in the Bill and the principle behind it, we should give the personal adviser the discretion to say, “Let’s give it a try for six months”. That power is not explicitly in the Bill and we should think about including it.

The noble Lord makes an interesting point. One could do it by discretion or by flexing the current rules, which can be an inhibitor. If we rolled forward the permitted work rules, people on a contributory allowance would be able to work for up to 16 hours a week and earn £86. That is currently not the same for people who are in receipt of income support. Whether flexibility can be considered to address that issue would go a considerable way towards meeting the noble Lord’s point. He makes a good point, as ever, about the importance of encouraging people into work, perhaps by small steps, until they can go back into full-time work.

That is well worth considering, although the tidier minds in the department may not approve of what might turn into a postcode lottery. Although it is a good idea in principle, it needs a lot more work before it becomes a reality.

To cut through the Minister’s response to the amendments, can I advise my consultants that the 16 hours permitted work rules and the £86 a week IB disregard will be no less generous under the introduction of the ESA, or is that not the case?

That is certainly right on the contributory allowance component. It would not operate that way; we simply rolled forward the current arrangements for people on the income-related component. We need to think more about that issue.

Half a carrot is better than no carrot at all. I am grateful for that. I will think further and possibly pester the Minister on his thinking about the income-related part of ESA. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Before I call the next amendment, I should say in regard to the amendments in the name of the noble Baroness, Lady Wilkins, who is not here, that the Companion says that the Chair calls the amendment and any Member of the Committee can move it.

[Amendments Nos. 17 to 26 not moved.]

Clause 4 agreed to.

Clauses 5 to 7 agreed to.

Clause 8 [Limited capability for work]:

27: Clause 8 , page 6, line 8, leave out “by” and insert “on the grounds of”

The noble Lord said: In moving Amendment No. 27, I wish to speak also to Amendments Nos. 39 and 84 and make passing reference to Amendments Nos. 57 and 58.

My amendments in this group attempt to make some provision for those claimants who are on ESA, not because of their own limitations but because of the attitudes of some employers. This is unfortunately not an unlikely obstacle to employment, but is instead one of the major barriers to work that disabled people continue to face, despite the Disability Discrimination Act as amended.

The Cochrane review found that 58 per cent of people with schizophrenia can work with the proper support yet, according to the DWP’s report, 75 per cent of employers believe that it would be difficult or impossible to employ someone with that disability. Why are the Government not taking the opportunity this Bill offers to address this? We are currently debating a new system specifically designed to help disabled people move towards employment. What is the point of the ESA if, after considerable effort, time and investment on the part of the claimants and the organisations involved, employers are still unwilling to employ disabled people through lack of information or support?

Our amendments therefore seek to ensure that the Bill addresses some of the supply-side problems disabled people can face. The first two amendments are to appreciate that a disabled person’s ability to work can be limited because no employer will hire them, even if they are perfectly capable of doing the work and, indeed, want to do the work. Such discrimination, whether deliberate or unintentional, is common and no less an obstacle to work than the disability itself. Can the Minister tell me how many disabled people are employed in non-government business now compared with 1997? Despite the Disability Discrimination Act and its amendment that I just mentioned, can the Government claim any credit here? It is instructive to learn the record of the Minister’s own department. In a recent Written Answer in another place I discovered that in 2005-06, 34 new disabled people were employed in the DWP but 500 left. Going back to the foundation of the DWP in 2002-03, the statistics are much the same.

To illustrate the problems of disabled people seeking employment, I refer to one of my correspondents who had a very bad experience in an inner-city area. He is a highly intelligent man who had just completed a computer accountancy course, even though he had produced a computer program for one of his son’s schools at which he was a parent governor. He applied to the city council for a job. This individual is partially sighted with a degenerative disease and has now reached the point where he walks with a white stick. When he turned up for the interview, for which he reckoned he was qualified—and clearly the council officials reckoned he was qualified, on paper anyway—he was told to go away because he was carrying a white stick. That is illustrative of the sort of problems that can, and, I am afraid, do occur, and should not. I have to confess that that happened before the recent amendment to the Disability Discrimination Act. If that Act is working properly, such a situation will never occur again. It could easily occur in the private sector, however, which is something one does not want to happen.

My other amendment is to encourage the Government to complete the policy that is set out in this Bill regarding making claimants ready for work by improving awareness among employers. There is much that could be done to educate them, not only in the capabilities and strengths of disabled people but in the support already available, such as the disability facilitation grant. Do the Government have any plans to improve awareness of that grant? What other means of support is currently offered to employers with disabled employees?

To form an effective policy for improving employer attitudes to disabled people would involve considerable input from the DTI, as well as from the Minister’s department. What co-ordination is there currently between the two departments on this issue? After such a comprehensive review of the disability benefit system, it will be deeply disappointing if the hoped-for improvements for disabled people are not achieved due to lack of sufficient co-operation between the two departments. I hope that the noble Lord will assure me that that will not happen. Various ideas are floating around as to how that might be done but, before mentioning them, I should like to hear the Minister’s response to what he would like to see done, and we will see if we can coalesce. I beg to move.

I shall speak to Amendments Nos. 57 and 58, which state that the healthcare professional must assess the extent to which the claimant’s,

“capability for work may be improved by the taking of steps by the Secretary of State in relation to factors that limit his capability to work”.

The DWP report 95 showed that 74 per cent of employers do not know about the existence of the access to work scheme. I thought that the noble Lord, Lord Skelmersdale, was going to shoot my fox at that point—but he did not, so I am very grateful. Access to work can help to pay for adaptations to premises and equipment, support workers and travel to work among other things. Is it any wonder that many employers do not want to employ disabled people if they think that they have to bear the burden of any such adaptations to their workplace to accommodate such employees? Knowing about the access to work scheme would address that problem.

The way in which the amendments would work is that claimants would be informed during the work-focused health-related assessment about the access to work scheme, which they could then relay to potential employers. How is the Minister’s department planning to make the access to work scheme better known?

I want to add one small point arising from what the noble Lord, Lord Skelmersdale, said about the DWP’s record in employing disabled people. I do not know whether the Minister heard the “Today” programme this morning, but it is a fairly widely known fact that disabled people have a very good attendance record and very low absenteeism. Given that the DWP has the worst record of absenteeism and sickness of any major Whitehall department, it would be well advised to employ more disabled people.

This group of amendments concerns employers, attitudes of employers and what the Government will provide to individuals to help them to return to and remain in work. I shall deal first with the amendments proposing that a person’s limited capability for work or work-related activity should be based on the grounds of his condition, as opposed to being limited by his condition.

These amendments are born out of concern that disabled people may find themselves suffering unfair discrimination by employers because they have a disability. While I agree that the attitude of many employers to people with disabilities—particularly a mental health condition or learning disabilities—is something that we need to change, I would point out that it is unlawful under the employment provisions of the Disability Discrimination Act for employers to discriminate against disabled people in recruitment and employment. It is not appropriate for any assessment of capability for work in determining entitlement to ESA to take account of potential unlawful actions by employers.

The way we determine 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 attitude of different prospective employers. In the revised PCA, we have a method for fairly and objectively assessing benefit entitlement on the basis of a person’s functional limitations resulting from his physical or mental condition. It is an assessment that will be consistently applied throughout the country. Introducing societal factors, such as employer attitudes, into the assessment would mean we would have to consider factors that might vary locally, which would undermine this principle of consistency. It would mean entitlement to ESA would be dependent upon factors such as where a customer lived instead of upon the individual’s level of functional limitation.

The noble Lord has also tabled Amendment No. 84, which relates to Clause 18 to ensure that any pilots we run,

“encourage employers to recruit and retain”

individuals. The powers set out under Clause 18 are designed to ensure that any pilots have a clear purpose in mind, which is to allow people with the ability to return to work to realise their potential. We are determined to explore a broad range of avenues that might lead to better outcomes for employment and support allowance customers. By offering a tailored package of help and support, including such schemes as access to work, we help customers become job-ready.

Existing legislation, in particular the employment provisions in the Disability Discrimination Act, already requires employers not to discriminate against disabled people in recruitment and employment. Those provisions also require employers to make reasonable adjustments to overcome any substantial disadvantage a disabled person might face compared to a non-disabled person. We are already working closely with employers and will continue to do so. For example, we have undertaken a series of campaigns to raise awareness and understanding of the DDA among employers, especially small and medium-sized employers, and to encourage them to fulfil their duties. Building on that, we want to raise awareness and promote the employers’ role in the recruitment of people leaving benefit.

At a local level, Jobcentre Plus is leading the way in securing the effective, voluntary engagement of employers. In the provider-led areas of Pathways, for example, we specifically ask during the bidding process for information about providers’ involvement or links with local employers and employment agencies and how they will meet local labour market conditions. However, we do not believe that it is appropriate or effective to increase the regulatory burden on employers.

Amendments Nos. 57 and 58 relate to Clause 10 and concern the work-focused health-related assessment. This is an additional stage that we are adding to the PCA process to focus on a customer’s residual capacity and on what health interventions would help to increase it. At the work-focused health-related assessment, we will be exploring with customers the barriers that they perceive between themselves and the labour market. Some of the barriers will be medical, but it is likely that some of them will relate to other factors, such as a lack of appropriate skills or the need for workplace adaptations. We are not suggesting that those non-medical barriers will be ignored, but we want the work-focused health-related assessment to focus on what health-related interventions—for example, a course of cognitive behaviour therapy—might help to improve a customer’s functional capability. We know that early intervention can have a beneficial effect on health and capability, so we want to ensure that any health-related barriers are identified and acted on as soon as possible. That is why the assessment will be carried out by trained healthcare professionals.

That is not to say that the assessment will not also deal with other matters, and we expect the healthcare professional carrying out the assessment to be able to identify, in general terms, occupational or other factors that are creating a barrier to work. Information from the work-focused health-related assessment will be given to the personal advisor. Although personal advisors are unlikely to have the skills needed to identify health-related interventions, they will be able to provide help and support to address societal barriers, such as skills needs or low confidence, during work-focused interviews. It would not be the most effective use of scarce resources to expect healthcare professionals to provide customers with information which is available from other sources.

In relation to occupational factors, the first PCA, including the work-focused health-related assessment, will be carried out during or soon after the 13-week assessment phase. As I said, as well as identifying health-related interventions, the healthcare professional will be identifying other factors that are creating a barrier to return to work. They will consider workplace factors in general terms. For example, they will be able to advise whether a customer has mobility problems making it difficult to access a workplace, or if a customer has difficulty standing for prolonged periods of time. At this early stage, however, without a specific job in mind for the customer, it is not yet appropriate to carry out a detailed workplace assessment.

Turning to some of the specific questions raised and the issue of the DWP and its record on this matter, we always need to do more. We need to be mindful that reporting on disabilities is self-reporting by employees and we need to understand the figures better. The noble Lord, Lord Skelmersdale, quoted some figures on joiners and leavers. I cannot comment without more detail, but I suspect the problem is partly to do with the recent restructuring of the department. Perhaps he will let me have the source of those figures so that I can look at them in more detail.

The noble Lord asked about co-operation between the DWP and the DTI on the matter of working with employers. There is wide cross-governmental co-operation in relation to the employer engagement agenda. The DWP, Jobcentre Plus, the Health and Safety Executive, the Department of Health, the NHS and the DTI are exploring together how they may best contribute, particularly in relation to issues affecting people with mental health problems.

I want to take a moment of the Committee’s time to run through some of the things that the Government are doing on a cross-governmental basis to help people who have mental or physical disabilities into employment. We recognise that the problems faced by people with mental health conditions in particular are varied and complex, which is why the changes to the Disability Discrimination Act are important. We also recognise that there is no magic bullet and that one department alone will not be able to tackle these problems. In October last year, the Department of Health launched a new initiative called “Action on Stigma: Promoting Mental Health”, which was on ending discrimination at work. The scheme provides employers with a set of core principles that they should seek to follow and a clear process to help them do so, as well as information, advice and support via nine regional employment support teams. We also have the cross-cutting review that the Chancellor announced in Budget 2006 looking at mental health problems and employment outcomes.

Our strategy of engaging employers is advised by the Prime Minister’s Strategy Unit report Improving the Life Chances of Disabled People and the National Employment Panel’s Able to Work report. The clear message is that success will be best achieved through a sustained campaign led and delivered by employers, supported by the Government and in consultation with disabled people. We believe that committed employers should be given the opportunity to develop and spread positive ideas on an employer-to-employer basis.

If we look generally at the Government’s record on supporting people with disabilities, we have strengthened civil rights and the Disability Discrimination Act has been strengthened to provide protection for an additional 600,000 disabled workers. We have brought 7 million more jobs and 1 million more employers within the scope of the employment provisions, and we have established the Disability Rights Commission. I have already mentioned the National Employment Panel and the Able to Work report.

The issue of training and awareness raising for employers is an important point. We actively promote the availability of all our disability services and programmes—the noble Baroness asked about that—including Access to Work among both disabled people and employers. Information on all of them is freely available in jobcentres and on the Jobcentre Plus website, as well as through disability organisations. Jobcentre Plus invests £300,000 a year in marketing and publicising its disability services and programmes, including Access to Work. Leaflets and information about Access to Work are freely available in Jobcentres, and disability employment advisers regularly meet local employers to promote the full range of disability services, including Access to Work.

Why is Access to Work not well known? I take the point that it is well known in job centres and so forth and there are pages and pages about it on the DWP website, but it is not a well-known benefit. It is particularly important to find another way of getting the information to employers. Perhaps the DTI should be involved. Perhaps the CBI should take some steps. Will the Minister speak to colleagues in the DTI to see whether that could happen?

The point is well made. The research on Access to Work shows that applications come from a range of sources, which suggests that there is a degree of knowledge out there. However, I accept generally in relation to Access to Work and the other issues that I ranged over that there is more to be done. This is a significant task. We must do this on cross-governmental basis and in partnership with employers and the support groups which work so valuably and importantly with disabled groups. That is the best way forward.

I hope that the Committee will find that helpful and that I have dealt with all the points that have been raised. If not, I am happy to have another go, but in the circumstances I ask the noble Lord to consider withdrawing the amendment.

Well into the middle of the Minister’s answer, I was worried that it was a purely personal departmental answer. But then he crossed through the barrier of the problems with employers. I agree with the noble Baroness that the publication and expansion of Access to Work would be a good way of getting round the particular problems that she and I have identified.

The extraordinary thing is that, as was discussed in Committee in the Commons, the drafting of Clauses 8 and 9 is completely at odds with the definition of disability that the Government have effectively adopted with their acceptance of the strategy unit's report, Improving the Life Chances of Disabled People. The report states:

“Disability is defined for this project as the disadvantage experienced by an individual as a result of barriers (attitudinal, physical, etc.) that impact on people with impairments and/or ill-health”.

Does not the wording also run counter to the most progressive example of a legal definition of disability as given in the Canadian Employment Equity Act 1995? This provides that “persons with disabilities” means persons who have a long-term or recurring physical, mental, sensory, psychiatric or learning impairment and who,

“a) consider themselves to be disadvantaged in employment by reason of that impairment, or

b) believe that an employer or potential employer is likely to consider them to be disadvantaged in employment by reason of that impairment”,

such as the example I gave earlier of the inner city council. The definition continues:

“c) and includes persons whose functional limitations owing to their impairment have been accommodated in their current job or workplace”.

“On the grounds of” is a concept that is also found in European framework directive 2000/78 which establishes a general framework for equal treatment in employment.

The result of my thinking on this is that labour market disadvantage and limitation on the grounds of physical and mental functioning are two entirely different concepts. The arguments put forward by the Government for not adopting the concept of labour market disadvantage do not apply to the idea of limitation being on the grounds of physical and/or mental health functioning. I shall have to think deeply about where I shall go with the amendment on what we might call the supply side of the Bill. For the moment, I can do no more, unless the Minister is poised to intervene.

In relation to whether the PCA should reflect socio-economic factors, of course it has an impact on the rehabilitation of people with a disability and on their confidence and ability to enter or return to employment, but 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 availability of transport or the attitude of prospective employers. The revised PCA, based on functional limitations, is an objective assessment that is consistently applied throughout the countries. Other factors will be assessed at later points in a claim, particularly as someone moves closer to work, but are not appropriate for the PCA itself.

I turn to why we use “disablement” when the Disability Discrimination Act defines disability using “impairment”. It defines disability as,

“a person has a disability for the purpose of this Act if he has a physical or mental impairment which has a substantial and long-term adverse effect on his ability to carry out normal day-to-day activities”.

The World Health Organisation defines disability as the restriction of ability that results from impairment. At the heart of this—whatever definition you use—the process is about understanding how the condition that a person finds himself in affects his functional ability to work or not to work or to progress towards work. The assessment of how it impacts on individuals is the key to this process.

Again, that is more of a departmental answer than the one I was hoping to get from the noble Lord, which perhaps I might better describe as a DTI answer. The noble Lord is naturally concerned with the construction of the benefit and is looking at the whole thing from the perspective of whom we call “the client”, and whom I used to call “the claimant”. I understand that. None the less, there is nothing more mentally debilitating than being on the work assessed group and going to interview after interview for a job for which you know, and indeed your adviser knows, you are perfectly well qualified, and not getting the wretched thing. That will eventually push some people on to the supported group, which is the last thing any of us wants.

Absolutely. I agree entirely with the thrust of the noble Lord’s point. We seem to be arguing only about how the PCA fits in to how you deal with all that. Issues of discrimination generally are dealt with through a range of factors, including cross-government engagement. I outlined earlier some of the engagement that is taking place. It is a huge task—I would not suggest otherwise—but I believe that we are approaching it on a cross-government basis. The welfare to work reforms are a component of that, but it is not the only plank of how we deal with this discrimination, which is entirely unacceptable.

Perhaps what I am looking for is work to welfare reforms rather than welfare to work reforms. Having said that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 28 and 29 not moved.]

30: Clause 8, page 6, line 17, at end insert—

“( ) make provision as to the qualifications of the person undertaking the assessment;”

The noble Lord said: I shall speak to Amendment No. 42 as well. Amendment No. 30 amends Clause 8 and Amendment No. 42 amends Clause 9. As the Committee will see from the Marshalled List, they both say that provision should be made,

“as to the qualifications of the person undertaking the assessment”.

The amendments seek to clarify the skills and experiences of the assessors.

It is of course critical that assessors are sufficiently trained so that they can successfully assess the limitations a disability imposes. Unfortunately, even the research of the Department for Work and Pensions suggests that this is not the case, and that assessors are especially lacking in experience with mental disabilities and learning difficulties. Do the Government intend to raise the standards of training of their assessors? If not, will this not be a significant obstacle to the rollout of the ESA? It would be sensible, in view of many of the variations of disabilities, to ensure that a claimant with a mental disability is assessed by someone properly qualified in those types of disability. Do the Government have any intention of assigning different assessors to claimants with disabilities in their field of expertise, or will there be a totally random system of allocation?

Not only is there a strong argument for claimants with various disabilities to be assessed by assessors with appropriate and specific experience, but the two tests also seem to need a very different set of skills and training. Whereas the first assessor will need medical experience to understand fully the disability that they are measuring, the second will need considerable experience in rehabilitation and training to know what support options are available for the claimant and how much improvement can be expected from them—in other words, how close they are to the job market. Can the Minister confirm that the two tests will be undertaken by two such different people?

Where does the health professional approved by the Secretary of State, mentioned in Amendment No. 111, fit in? Is he to have direct contact with the claimant, or is he to advise the assessors or the decision-makers, or, indeed, the decision-maker? I have not quite established whether there will be a single national decision-maker or whether they will be regional, or perhaps there will be one in each office. I do not know how these decision-makers will fit into the picture, but I am sure I shall be told sooner rather than later.

While I understand that the decision-maker, whoever he is and wherever he sits, makes the final decision, I cannot believe that he is expected to be a medical polymath without a full understanding of either employment needs or medical therapy. How can work-related interviews result in achievable and useful goals? I look forward to the Minister’s response for assurance on these points or an explanation of why my concerns are needless. I believe that this will be the first occasion on which the noble Baroness, Lady Morgan of Drefelin, has spoken from the Dispatch Box, and I congratulate her on her promotion. I beg to move.

I must express a degree of envy. The noble Lord has put down an extremely good amendment that comes in straight alongside the issues with regard to good practice I was raising earlier. Unless you are qualified to carry out the assessment correctly, you cannot do it. It is that simple. Mental health is a subject that has been much on the minds of this House over the past few weeks, and we have seen that you need specific training.

The noble Lord mentioned other types of disability. We can run down the list. Unless those involved have some expertise or training, or have at least been trained how to assess and bring in support—which might be a way of squaring this circle, although even then there would be limitations—they will not be able to do it.

Once again I apologise for not adding my name to this amendment—I think our “spring break” has a little to answer for. Unless we get some form of assurance that we are getting people to carry out the assessment who know what they are talking about, the potential benefits of this system will start to miss a large proportion of its client base, or claimants—call them what you will. The people who are going through these assessments may well not get the help they need, and the system will fail. Will the Minister assure us that assessors will be qualified to do this and qualified in bringing in the expertise when it is needed? That is what is required here. If that cannot be done, and if we cannot be given some idea of structures, there is a damn great hole in the whole system.

I welcome the noble Baroness, Lady Morgan, on behalf of the rather large Liberal Democrat team. I thought that the noble Lord, Lord McKenzie, and the noble Lord, Lord Skelmersdale, might have been feeling slightly lonely. We are delighted to welcome the noble Baroness and hope this will be the first of many ministerial appearances.

I do not want to be left out of this welcome. It is a great pleasure. This is my first Committee, so I know how the noble Baroness feels.

My question is not so much about qualifications and capability as quantity. We learnt from the pilots that we were dealing with people who were enthusiasts and converts; they were in key positions because they wanted to be. Some of the regions were chosen particularly because of the expertise among the existing staff. My concern is that in the very ambitious roll-out timetable for the programme of the Bill, the capacity of those capable of carrying these heavy responsibilities is not yet available. Earlier on, the Government accepted that this was a challenge. That word frightens me because Governments always struggle to deal adequately with challenges.

My noble friend is absolutely right. The whole business is hinged on getting appropriately qualified, sufficiently staffed positions. He is rightly concerned about the level of qualifications; I am concerned, more fundamentally, about the fact that the staff will not be there and they cannot be magicked out of thin air. This will take weeks, if not months, of intensive training; they have to have special people skills to be able to do the job. The noble Baroness may not have the answer immediately to hand, but how is the training process going? What capacity currently exists? Is the department confident that when day one arrives, there will be a sufficient number of people in place to start the process in a way that leaves her and her ministerial colleagues confident that the job can be done properly by an appropriate number of skilled individuals?

From a Cross-Bench position, I support the amendments. Disability is exceedingly complex; when you are talking about mental health and bodily health—a word I had not heard before, but I suppose I am included, having a disability—it is vital to have properly trained staff, otherwise there will be a muddle.

I feel well and truly welcomed to my position and to this Committee. I thank noble Lords for their warm welcome.

The assessment for limited capability for work and limited capability for work-related activity will take place during the same appointment and will be conducted by the same healthcare professional. As set out in the draft regulations under Clauses 8 and 9, where a claimant is asked to attend a medical examination, it will be with a healthcare professional approved by the Secretary of State. This means we will continue the current practice whereby all those carrying out medical examinations will undergo training specified and agreed by the department’s chief medical adviser before being approved by the Secretary of State to carry out those examinations. With reference to the point made by the noble Countess, Lady Mar, one of the modules that the continuing professional development of health professionals covers is chronic fatigue syndrome.

The healthcare professional must subsequently maintain standards set by the Secretary of State to keep that approval. The training the healthcare professionals receive equips them to assess the functional effects of any disabling condition, either physical or mental. That is what is required to be able to assess limited capability for work or limited capability for work-related activity.

In addition, the healthcare professionals who carry out the assessment are also trained in the evaluation of written evidence so that they will be able accurately to identify those who will be in the support group on the basis of paper evidence. We do not intend that the training itself will be prescribed in regulations; this will allow us to maintain the necessary flexibility to change the requirements when required—for example, to respond to feedback that a specific training need has been identified that applies to all healthcare professionals. We all recognise that that is very important.

Before the new PCA is introduced, we will develop new training for the Atos Origin healthcare professionals, who will carry out the revised assessment. So new training will be developed. We shall seek advice from appropriate organisations with a special interest in specific health conditions when we devise that training, which I think will be welcome. For example, the National Autistic Society has given valuable advice in devising training assessments, especially for people with Asperger’s syndrome.

The noble Lord, Lord Addington, made a point about whether the personal capability assessment for people with mental health conditions will be carried out by health professionals with expertise in that particular condition. The issue is very much about professionals being trained to assess functional capability. They are trained to understand mental health conditions, to have advanced interviewing skills and to assess customers’ issues with empathy. It may be appropriate in some situations to use healthcare professionals with specialist expertise—for example, in assessing people with mental health conditions. But entitlement to benefit depends on the effect of a person’s condition on his functional ability; it does not depend on detailed clinical knowledge of the diagnosis and treatment of the conditions—it is functional ability. All healthcare professionals are trained especially in assessing the functional effects of any disabling condition.

If it is functional capacity that is being tested, what is the process by which that is assessed if you are not really an expert in the field? At which point are you told that you have to bring an expert in? When are you told that you do not understand something? It would be helpful to have that brought out. It would reassure me if there was a limitation whereby someone could say, “I don’t know what I am dealing with here and I need an expert brought in”. Has that been addressed?

The point that we need to look at is on the personal capability assessment descriptors that are very detailed and which the staff are trained to apply. We need to be clear that in the past a particular diagnosis was used as a method of entitlement, whereas here we are talking about functional limitations as defined by the descriptors in the PCA test. The health professionals are trained to use those tests in a fair and consistent way. They are audited to ensure that they are applying their skills professionally and up to the standards required by the Secretary of State and monitored by the DWP’s medical adviser.

The noble Lord, Lord Skelmersdale, asked whether healthcare professionals carrying out the PCA receive training in assessing mental health. I think I have already mentioned that—the answer is yes. All healthcare professionals carrying out assessments are trained in the skills they need, including assessment in mental health problems. For ESA, the revised PCA mental function assessment is much more comprehensive than the current assessment, and we will provide training to all healthcare professionals in applying that revised test. We will consult organisations with a specialist interest in mental health when the training is being developed. We particularly recognise the value that such organisations can bring to developing this training. However, there is no need to be an expert in mental health to assess functional capabilities. We will be piloting the work-focused health-related assessment and will evaluate whether it will be more effective using the same healthcare professional or a different one, which is an important point. I hope that I have picked up all the questions. If I have not, I will follow them up.

The amendment makes provision in legislation for the training of healthcare professionals, but that would not improve or enhance the system already in place. Instead, the amendment would limit our flexibility to respond as necessary to situations calling for change to the current processes. I therefore urge that the amendment be withdrawn.

I am very grateful to the noble Baroness. I have been labouring on these assessments under what appears to have been a misapprehension. As I understood it, there would first be an assessment using the descriptors to decide whether the process should be taken further or whether the benefit was not appropriate for that claimant. Then there would be a second assessment about which group he should fall into—in other words, a slightly more severe test. I assumed that there would be a third test to identify the procedures that the claimant needed to undergo in order to get as close to the employment market as possible.

From what the Minister said, I understand that health professionals will be used to make the assessment in the first two tests—and the Minister nods, so I am right. But what about the third test? It needs knowledge of health disability matters and employment matters. I assume that somebody else will be involved here. Perhaps the noble Baroness will give me an answer on that.

It needs to be made clear that although the Bill has separate clauses—Clause 8 and Clause 9—in reality, as far as the customer is concerned, there will be one assessment. The assessments are separated for the purposes of the Bill, but for the customer and the health professional they will be one discrete assessment. It might help if we talk about the work-focused assessment next.

That is extremely helpful, and I have not had the assessments explained to me in that way before. So there will be two assessments, but only for the work-focused group. For everyone else, there will be a single assessment. Is that correct?

From the customer’s point of view, they will have an assessment that will look at entitlement for ESA and at their limited capability for work-related activity; one assessment will look at those two strands. Then there will be a separate work-focused health-related assessment. It is the important new element introduced in the Bill and will look at the capabilities of a person and at the barriers that need to be overcome: the positive side, not the limited capabilities side.

So, as I said, those assessed as being in the non-support group will undergo a further work-focused assessment. As I understood her, the Minister said that the department had not yet decided whether that assessment would be made by the same people who made the first assessment. Since knowledge of the employment market is so important in this, it would be sensible for the assessments to be conducted by different people. I leave that thought with the Minister. She might want to say something now, but I would be happy to have a letter on the subject on the department’s current thinking.

I shall make one last point on this. It may not be the same health professional, but we must not forget, when considering all this, the role of the personal adviser, which comes later on in the discussions. They will be the real expert in understanding the employment market rather than the health intervention.

We need to be clear about the skills and training of all the different professionals involved. They have been very carefully thought through. We have the health professionals, who are carefully trained and audited in the standards they deliver. We have the health professional, who may have an occupational health background, who is responsible for the work-focused health-related assessment. After all that has taken place, we have the personal adviser, who has a key role that I am sure we will talk about later on.

We will move on to the role and the contract terms of the personal adviser later on, probably next week. I am extremely grateful to the Minister. I think I am quite a lot clearer in my mind, but I would still like her to ponder further whether the two internal assessments should or should not be conducted by the same individual as an assessor. I would be delighted if she would write to me on that. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

31: Clause 8 , page 6, line 17, at end insert—

“( ) ensure consistency of assessment across the country;”

The noble Lord said: In speaking to this amendment I shall also speak to Amendment No. 33. This amendment is about the consistency of testing, which to an extent we covered in our discussions just now. These amendments place a requirement on the Secretary of State to ensure that the assessments will be of a consistent standard across the country, and of course that depends on the training we have just been talking about. Other parts of the Bill, particularly the clause enabling the contracting out of service provision to third-party organisations, will lead to the possibility that claimants will have to suffer a postcode lottery in the quality and rigour of the assessments—or, rather, not the assessments, I hope, because they are under departmental control, but certainly the post-assessment support from the personal advisers.

Will the Minister assure the Committee that a rigorous standard will be enforced across the country? Although some flexibility is a good thing when it comes to responding sensibly to unique individual circumstances, that should not be taken to the extreme of allowing individual providers to go their own way. Can the Minister explain what steps will be taken to monitor how these assessments will be undertaken? Without sufficiently rigorous supervision, there will be no way of knowing whether the criteria for eligibility are being applied fairly across the whole country, and no remedial measures can be taken.

I have now remembered the point I was going to put to the Minister on the previous group of amendments. I still do not understand where the decision-maker fits in to the operation. If she can answer that as well as responding to the three questions I have just asked, I will be extremely grateful. I beg to move.

There is a broader point underlying this important group of amendments—the spatial incidence of unemployment. The pilot Pathways to Work experience suggested that in carefully picked areas of the country, things were capable of being handled, and lessons have been learnt. But some geographical locations, such as the travel-to-work area around Merthyr Tydfil, the north-east and the heavy industrialised areas, have a high stock of incapacity benefit claimants. The circumstances that apply in the small number of areas covered by the pilot is qualitatively different in terms of problems being faced, labour market conditions, culture, background and the way in which the department is able to deploy this policy.

It is right for the noble Lord, Lord Skelmersdale, to ask for assurances about consistency of assessments. The department is living in cloud-cuckoo-land if it thinks that conditions in Basildon are the same as those in Merthyr Tydfil, because they are not. If we do not recognise that right from the beginning, consistency of assessment will fail and the department will miss an opportunity with regard to the scale of the support measures necessary to deal with the spatial geographical incidence of the unemployment figures resulting from the collapse of the large-scale smokestack industries.

Can the Minister widen the questions raised by the amendments to deal with the quantity, level and scale of the difficulty faced by the personal advisers in Jobcentre Plus in these special areas of the United Kingdom?

I thought that the noble Lord, Lord Skelmersdale, said that he was speaking to Amendment No. 33. Did he not mean that?

The point about geography is essential. The drive behind these developments is to focus on the right of all people to benefit from employment. We know that in particular parts of the country, long-term economic inactivity is leading to appalling deprivation for families and single people, and it is essential that we address this. When my noble friend and I visited the Basildon Pathways to Work pilot, issues of how far we can roll out the positive experiences of a pilot nationally were at the forefront of our mind. One of the Pathways to Work pilots is in Rhondda Cynon Taf, which can hardly be described as an affluent area. There is a lot of learning to be done, and that learning is seen as very important. The department is not rushing to roll this out across the country without taking into account the huge variation in distribution of need.

It is a fundamental principle of any benefit entitlement decision that it should be applied consistently across the country. It would not be appropriate for entitlement to ESA to be based on standards that vary in different areas of the country, rather than being based on the condition of the individual customer.

The PCA already addresses the requirements of consistency in a number of ways. First, it is based on defined criteria by which limited capability for work is assessed—the descriptors and scores in the draft regulations. These descriptors focus on whether a person's condition has resulted in him having limited capability for work, not on whether he has a named condition. Different people may have different levels of functional limitation arising from the same disabling condition. The approach that we have taken with the PCA descriptors avoids this problem by assessing limited capability for work in a consistent and objective way against the same set of descriptors, regardless of where the assessment is carried out or by whom.

Secondly, healthcare professionals carrying out the medical examination that forms part of the PCA are trained to standards prescribed by the department's chief medical adviser before they are approved by the Secretary of State to carry out the medical examinations. They must subsequently maintain those standards to keep that approval. The quality of their reports and the advice they give to the decision-maker on the basis of paper evidence is monitored on a regular basis, again measured against clearly defined standards prescribed by the chief medical adviser for the Department for Work and Pensions. These standards are used in all medical services centres; and their use will be regularly audited to ensure that they are being applied consistently. We will continue to take these measures in relation to the revised PCA to ensure that it maintains this consistent approach when it is applied for the purposes of the ESA, both for the tests of limited capability for work, dealt with in Clause 8, and limited capability for work-related activity, dealt with in Clause 9.

There were further questions about the decision-maker. Formally, the Secretary of State delegates decisions to the decision-maker, who takes all the information provided by the assessment process and formally makes the decision for benefit entitlement. I hope that that answers that question.

I was asked what we were doing about monitoring the quality of medical reports. Sub-standard reports are a minority and I am pleased to say that Atos Origin Medical Services, which carries out the assessments, regularly monitors a statistically valid sample of reports that come out of this assessment and fewer than 5 per cent of them are unsatisfactory. Atos Origin has a programme of continuous quality improvement, which its audit results demonstrate is effective in driving up standards. Doctors who fail to meet standards are given feedback and remedial training. Their work continues to be closely monitored until they have reached the required standard. Importantly, if they fail to reach the standard despite retraining, their approval to carry out the assessments is revoked.

I do not believe that making provision in legislation for the PCA to be applied consistently would enhance or improve the systems already in place, although it is extremely important. It would limit our flexibility to respond as necessary to situations that call for a change to the current processes we have in place. I therefore urge the noble Lords to withdraw the amendment.

I am not sure that I followed all that, and I have still not understood where the decision-maker fits into this process. I think that the noble Baroness was about to answer me and forgot—something that I have been doing a lot of this afternoon so I most certainly excuse her.

The decision-maker is a member of staff at Jobcentre Plus and will make the decision on entitlement based on the report that he receives.

The report that he receives from the health professional who has done the assessments under Clauses 8 and 9.

It is interesting to reflect that, when he was Secretary of State for Work and Pensions, Alan Johnson described the current PCA as the most stringent gateway into incapacity benefit in the world. Whether he was right or wrong, the current PCA is stringent, and I understand that the new test with the new descriptors will be even more stringent. In broad terms, the mental health assessment has been improved, but the physical assessment has been significantly tightened. Lower-scoring descriptors have been removed, which could potentially exclude people with significant but lower-level impairments from receiving the benefit. Indeed, an early small-scale trial found that more than half of those who currently pass the PCA because of a physical impairment would fail the revised tests. That would impact in a number of ways. When current recipients of incapacity benefit are migrated to the new benefit, many could end up failing the new PCA and being taken off the benefit altogether, despite their circumstances not having changed. People with lower-level physical impairments, who might benefit most from some of the support programmes available through ESA, might end up failing the revised PCA and being excluded from the support programmes. The only benefit available to them would presumably be the jobseeker’s allowance.

The current PCA was introduced in 1995, and the comments made about it being stringent could apply to the original or the current assessment. We are now moving some way from that assessment. We are looking at an assessment that takes into account significant changes in employment experienced by people with disabilities and long-term conditions, as well as a change in the distribution between mental health problems and physical disabilities in people claiming incapacity benefit. We need to recognise that things have moved on quite significantly. There has been a limited evaluation of the PCA, which has looked at the current and revised PCAs. We are in the early stages of evaluating the effects of the developments, and it would be unfair to suggest that the revised PCA is such a stringent test.

I am not sure that whether it is fair or unfair. I shall have to ponder further on this one. However, I am grateful to the noble Baroness and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.