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Integration Loans for Refugees and Others Regulations 2007

My Lords, I am grateful to noble Lords who have contributed to the debate. I am particularly grateful to the noble Baroness, Lady Harris of Richmond, for her questions and concerns, which I fully appreciate. These were fair points to make. However, I take issue with the suggestion that this is an ill-thought out scheme. We have given it very careful consideration, and we said that we would not introduce it until we were in a position to do so. These loans are considerable, not miserly. They will help with housing by enabling deposits to be paid for rented accommodation and will help initially with rent payments, if that is what is wanted, or with essential items or moving expenses. They could be used to meet travelling expenses, clothing and footwear for a new job. They could assist those who are here as refugees and who have been offered humanitarian support to find an education or training programme that will enable them to retrain and qualify for a new job. It is for those very positive reasons that we set up this loan fund so that we can assist in an important area of integration. The noble Baroness asked how much we were paying out in back payments. I do not have those figures. I know that the question has been asked before, but we cannot be precise about it. Based on the number of individuals granted refugee status and humanitarian protection in previous years, we expect that there will be in the region of 5,000 beneficiaries annually. Of course, each loan application will have to be considered on its merits, but we think that the scheme will make a valuable contribution to assisting those who have a quite proper right, because of their immigration and asylum status, to be here. We think that it is fairer to provide a level playing field in support than to provide support by way of individuals applying for money that they would otherwise have received as benefits, as that money would have been determined entirely by the length of time that the person had awaited an outcome or decision; it would bear no relation to their current circumstances and it would not necessarily assist them with integrating into the world of work, the housing system and the world of education. For those positive reasons, we are happy to bring this scheme forward. The noble Lord, Lord James of Blackheath, asked how the scheme will operate and talked about the potential for abuse if there are questions over repayment. I do not think that there will be problems here, because the Department for Work and Pensions is, if it is anything, extremely experienced in dealing with benefits and in collecting overpayments and so on. The loans will be recovered using the existing mechanisms through which the DWP acts to recover overpayments and debts owed to utility companies, for example. I do not think that this should be a problem. The administration costs for the scheme have been estimated as being in the region of £300,000 in the first year. We calculate the average administrative cost of a loan payment scheme and recovery as being approximately £40, based on the assumption that some 4,000 loan applications will be processed. I was asked what will happen if there is a problem with default. If the individual is in receipt of income-related benefit, to which they will be entitled, deductions will be made from those benefits. That will be at a fairly low level—in the region of £3 per week—so a gentle repayment programme is in place. If an individual fails to repay the loan, we will enforce repayment. The usual DWP civil enforcement rules will apply where we are satisfied that there is no compelling reason why loan repayments cannot be made. Normally, civil action is taken only where a customer avoids repayment, not in cases where they are unable to pay. I do not think that the spectre of loan sharks will stalk this system, which should operate fairly. We have put in place a robust payment and recovery programme and we are satisfied that it should work well. Obviously, we will continue to review the scheme as it rolls out. As I have said, I think that this scheme is fairer than the current one. The noble Baroness, Lady Harris of Richmond, asked whether loans can be applied for on top of existing benefit payments. The answer is yes. The scheme is designed to ensure that there is adequate financial support for those who have been granted humanitarian status here as a refugee and to whom we owe a duty to assist with integration. I think the scheme will work well; we are confident of that. Although there has been some criticism of its modest nature, those who receive our country’s generosity, consideration and support through this scheme will find it extremely helpful in the future.