Considered in Grand Committee
My Lords, I beg to move that the draft order, which was laid on 31 January 2022, be approved. I am grateful for the opportunity to debate this order. It is the result of collaborative working between the two Governments in Scotland. The order is made under Section 104 of the Scotland Act 1998, which allows for necessary legislative amendments in consequence of an Act of the Scottish Parliament. Scotland Act orders are a demonstration of devolution in action and I am pleased to say that, although this is my first order, my office has taken through more than 250 orders since devolution began.
The draft order amends various pieces of legislation in the United Kingdom as a consequence of the Social Security (Scotland) Act 2018, which I shall refer to as the “2018 Act”, and regulations made under the 2018 Act. This order has been brought forward as a result of the close co-operation between the UK and Scottish Governments. Through the 2018 Act, the Scottish Government can introduce new forms of disability assistance using the social security powers devolved under Section 22 of the Scotland Act 2016.
Section 31 of the 2018 Act allows the Scottish Government to introduce a payment to provide financial assistance for disabled people in Scotland, called disability assistance. Disability assistance will replace three existing benefits currently delivered by the Department for Work and Pensions: disability living allowance, personal independence payment and attendance allowance. Through these powers the Scottish Government have legislated that adult disability payment will replace personal independence payment, beginning with a pilot on 21 March 2022.
From introduction, adult disability payment will operate in broadly the same way for broadly similar people as personal independence payment. Applications will be accepted from individuals between 16 years old and state pension age. It is the UK and Scottish Governments’ intention that there will be equitable treatment for those individuals receiving personal independence payment and adult disability payment. If this order is passed, it will ensure the equitable treatment of individuals in receipt of adult disability payment and personal independence payment with regard to tax treatments, benefits, entitlements and voting rights.
I will next outline the details of what the order does to ensure that people receiving adult disability payment receive equitable treatment with those on personal independence payment. In terms of changes to taxation legislation, the order will extend the definition of a disabled person to include individuals in receipt of a qualifying rate and component of adult disability payment. This will apply in two cases: first, where the tax treatment of property is held in a trust for the benefit of a disabled person; and, secondly, to the early withdrawal of funds from a child trust fund or junior ISA if the young person is terminally ill.
The order also extends provision to ensure that those on adult disability payment benefit from the following reliefs: a VAT zero rate for the leasing of vehicles to individuals under the Motability scheme; a VAT zero rate for the onward sale of vehicles previously let under the scheme; an exemption from insurance premium tax on the insurance covering vehicles leased under the Motability scheme; eligibility for a driving licence at age 16 rather than 17 when the individual has an award of the enhanced rate of the mobility component of adult disability payment; and an exemption or a 50% reduction in vehicle excise duty if the individual receives either the enhanced rate or the standard rate of the mobility component respectively. The order will also allow the DVLA to request data from Scottish Ministers to confirm whether an individual is eligible for a driving licence at age 16 or eligible for reliefs in vehicle excise duty.
The order also ensures that adult disability payment can act as a qualifying benefit for the annual Christmas bonus, carer’s credit and carer’s allowance in England and Wales. The latter will ensure continued entitlement to the reserved carer’s allowance in the small number of instances where someone in England and Wales is caring for an individual in Scotland. The order also makes changes to election legislation to entitle those receiving the enhanced rate of the mobility component of adult disability payment to a proxy vote at UK parliamentary and local elections. It also allows for this group to provide a proxy signature for a recall petition without attestation of the application.
Lastly, corresponding provisions for entitlement to carer’s allowance and carer’s credit have been included for Northern Ireland. This will ensure that a carer can apply for support in relation to an individual who has moved from Scotland to Northern Ireland while remaining in receipt of adult disability payment for the 13-week run, affording the individual time to apply and be assessed for personal independence payment.
As I highlighted earlier, all these changes simply ensure that the system for disabled people who are receiving adult disability payment operates in an equitable way, as for a disabled person receiving personal independence payment. These changes are not within the competence of the Scottish Parliament, and the UK Government are therefore facilitating them through this order. This ensures that people in Scotland are not disadvantaged by devolution, meeting the principles set out in the Smith commission.
Finally, the UK and Scottish Governments have worked closely together to ensure that the two systems of social security operate effectively alongside each other, and that the required legislation that underpins them is delivered successfully for the people of Scotland. This order highlights the importance that the UK Government place on the effective functioning of devolution and the strength of the union.
My Lords, I thank the Minister for that introduction, and indeed welcome him to the special joys of secondary legislation consideration in the House of Lords. I wish him many more in the future.
We support this order and are pleased to see the Scottish Government using the powers transferred to them under the 2016 Act and subsequent legislation—although I briefly venture that we might wish that they had been a little speedier in so doing. However, to say that is to grumble. As we have heard, the Scottish Government are introducing disability assistance for disabled people, and this new adult disability payment has been created to replace DLA, PIP and attendance allowance, starting with a pilot on 21 March. Indeed, a little earlier in Grand Committee, we were debating an order relating to how the ADP will interact with benefits in the rest of the UK. I will not go back over the other questions, but, as the Minister indicated, the order also extends exemptions in relation to mobility, vehicle exemption, access to early driving licences and the definition of a “disabled person” in some tax and benefit legislation.
I have a couple of questions. The Minister said:
“At its introduction, adult disability payment will operate in broadly the same way and for broadly the same group of people as personal independence payment.”—[Official Report, Commons, Delegated Legislation Committee, 2/3/22; col. 3.]
I take that to mean that the conditions for eligibility for ADP will be the same as for PIP, at least at introduction. Does the Minister know whether it is intended that the benefits will continue to be in alignment, or might they diverge over time? Does he know whether there will be a similar, or indeed the same, assessment process for accessing ADP as for accessing PIP? That could make a difference if someone was in receipt of one benefit and moved to the other jurisdiction.
What discussions have the UK Government had with the Scottish Government about how this transition will work? When this order was debated in the Delegated Legislation Committee in the other place, the Minister, Iain Stewart, said:
“The 13 weeks is a safety net, and applications can be made in advance. It is there to ensure that payments can continue if there is some delay, so that no one is disadvantaged.”—[Official Report, Commons, Delegated Legislation Committee, 2/3/22; col. 8.]
I took that to mean that an application for PIP could made while someone was still living in Scotland—in other words, in advance—in order to avoid any gap in payments. But I raised this with the DWP Minister in relation to the earlier DWP order, and, although I have not had the chance to read Hansard, I got the impression that this was not the case: someone would have to wait until they moved to England to make that application. But, if the Minister knows, I would be grateful to understand that—I may not have heard it correctly.
Either way, the intention of the run-on is clearly to ensure that there is no gap in payment for someone moving from Scotland to England. But is the Minister aware that the latest official statistics show that it takes 24 weeks for a claim for PIP to be processed? So, if there is a 13-week run-on and a 24-week application process, I wonder whether there have been discussions between the two Governments about how to manage that. Again, I raised this with DWP, but it is a matter for both departments to consider.
Could the Minister tell us what discussions have happened between the UK and Scottish Governments to ensure that disabled people in different parts of the UK are informed of the consequences of a move to or from Scotland? What support will be put in place to ensure a seamless transition from previous benefits to the new regime administered in Scotland? Ministers have said that the intention is that there will be a run-on going the other way as well, but we do not know when yet—so obviously that is an issue in the short term.
Finally, I have one brief question. There will need to be effective interaction between these new Scottish systems and the existing UK infrastructure, including in respect of DVLA as well as DWP. So how do we ensure that both those systems work well and that people who are getting benefits are aware of possibly different timescales and application mechanisms—and, as a result, know what to do? These benefits go to some of the most vulnerable people in our society, and it is very important that they work well. I look forward to the Minister’s reply.
I thank the noble Baroness, Lady Sherlock, for her comments. It is indeed interesting that the first instrument on this afternoon’s Order Paper covered the same piece of legislation from the other end; we are joined up in that respect. The question here is broadly about the same way and the same people. The principles are very much that the two Governments work in lock-step; that the treatment of individuals in the UK should be the same, whichever jurisdiction they happen to be in; and that, at the current moment in time, there is absolutely equal treatment in terms of qualification and payments between the two countries.
However, as part of the Scotland Act and the Smith commission, a transfer is ongoing. This is in fact the 12th such benefit to be moved north of the border. Effectively, it allows the Scottish Government not only to become the payer but to have the machinery to make payments through Social Security Scotland. The customer should see absolutely no difference in this transition but, going forward, we have pilots starting in Perth and Kinross, Dundee and the Western Isles. Initially, new claimants will come on to the new system. The idea is that, from the summer onwards, 300,000 people will be transferred across from the English system to the Scottish system. However, it is absolutely not our place to debate in this place how that will go forward. When we transfer those powers, we do so on an equal basis; it will then be for the Scottish Government to decide how they will legislate for their programme of government. We cannot comment at this point as to whether there will be divergence; that will be a matter for the Scottish Government.
As far as the 13-week timeframe is concerned, that is considered reasonable. I heard the point made in the first debate about 24 weeks, which seems rather long. I know that the Minister in that regard will write; the question of what will happen if there is a gap is one that we will probably come back to. The objective here is to have no gap, so that, as claimants move from one region to the other, they can apply and be assessed within 13 weeks, and continue—and, indeed, be backdated as well. The spirit of this legislation is that there should be no gap, but the specific question about 24 weeks needs to be looked at, so I will combine with the Minister from the first debate, my noble friend Lady Stedman-Scott, on that one.
Crucially, the notification of customers is dependent on what we now call customer care. It should be done with the customers. The DWP must write to customers who are transferring, and anyone coming south of the border again must be notified by Social Security Scotland. One has to assume that the agencies involved will do that and take care of the process. At the end of the day, the DWP and Social Security Scotland will co-operate closely. Their objective will be to ensure that there is no detriment to disabled people as a result of the introduction of the adult disability payment.
I conclude by saying that this instrument demonstrates the continued commitment of the UK Government to work with the Scottish Government to deliver for Scotland and maintain a functioning settlement for Scotland.