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Social Security (Miscellaneous Amendments) (No. 4) Regulations 2008

My Lords, the noble Baroness, Lady Thomas, is quite right to draw the House’s attention to this order as it has had the most devastating critique of any regulations issued by the Department for Work and Pensions in recent years. That is exemplified by the speeches that we have heard from all round your Lordships' House. Like others, I note that these regulations were referred to the Social Security Advisory Committee. These matters are often dealt with by correspondence, as the Minister well knows, but not this time. The Social Security Advisory Committee decided that it would undertake a full inquiry, citing its continuing interest in the backdating of income-related benefits, the apparent lack of reliable evidence regarding the rationale for making the changes in the first place, the unsupported costings for the new arrangements and the unprecedented number of complaints from organisations and individuals, not least those on behalf of vulnerable groups which will inevitably be affected. It also believed that these regulations are likely to go against the Government’s avowed aim of reducing poverty. As the noble Baroness, Lady Thomas, said, this is hardly surprising as the department made similar proposals to those in this order as long ago as 2000, which were summarily dropped following the Social Security Advisory Committee’s similarly adverse comments. Yet here we are again, as the Government still maintain that the order will result in savings for the public purse and stop what they call ““confusion”” among claimants. They are surely right on the first point, and your Lordships’ Merits of Statutory Instruments Committee has provided us with some figures, which I can only say were prized out of the department by the Social Security Advisory Committee. We were told that the saving amounts to some £170 million in 2009. It is therefore incredible that the department failed to live up to the Government's own requirement that an impact assessment is required for any proposal that reduces costs by more than £5 million. Your Lordships’ committee drew the conclusion that the lack of such an impact assessment must mean that the savings are going to be nothing like the £170 million that was suggested. If she will allow me to paraphrase her, the noble Baroness, Lady Thomas, thinks that nobody knows. Like the noble Lord, Lord Kirkwood, I am much more cynical. I believe that significant savings will be made, but that Ministers did not want to make that too obvious to the Social Security Advisory Committee or to Members of Parliament. That leads me to my first question: is the anticipated figure still £170 million? If so, why was no impact assessment produced? Secondly, why the apparent ageism? Why should claimants over 60 be treated any differently from those under 60? This question is relevant to claimants of housing benefit and, to a lesser extent, of council tax benefit, both of which were mentioned by the noble Lord, Lord Best. SSAC has often argued that housing benefit is different from other social security benefits because a significant number of claimants pursue it only after they have got badly into arrears with their rent, maybe even to the extent of being threatened with eviction. These rent arrears often pertain for many months and are suffered by people who, almost by definition, fall into the poorest category in our society. My complaint is that from now on, pensioners will have only three months to claim, whereas those of working age will have six. Why the discrimination against pensioners? Talking of pensions, does the Minister really consider that this discrepancy is balanced by an undoubted bonus; namely, the increase in the time that pension credit can continue if the claimant is abroad from four to 13 weeks? The Government and SSAC believe that the current period is too short. I am happy to go along with that, but why was 13 weeks chosen? It seems a thundering long time for people to be on holiday, especially as people on pensions credit are most unlikely to have much or, indeed, any other income. Being charitable, I suppose that some may have children who are happy to have them for this length of time, but I rather wonder how many of your Lordships would dump yourselves on your expatriate family for so long. I certainly would not. It is also possible that a pensioner may go abroad for medical treatment, but even with recuperation time, 13 weeks seems an excessive amount of time. I ask again, what is the magic about these 13 weeks? As a philosophy, it stands out against the proposal for housing benefit and council tax benefit, but to me the worst horror of this order is the reduction in the time that pensioners are allowed to claim pension credit, upon which the noble Lord, Lord Low of Dalston, majored. At the time of the worst financial crisis in living memory and with pensioner inflation running at 9 per cent, this decision means that the poorest pensioners—those who have not yet claimed pension credit—are to remain in poverty if they do not claim within three months, and pensioner poverty is increasing. The most recent figure I have is that in 2006-07, 2.1 million pensioners were living in poverty, which is an increase of 300,000 people. That was at a time when the Government were supposedly seeking to reduce pensioner poverty. The Department for Work and Pensions’ agreement targets for 2005-08 said as much. It stated that by 2008, it would, "““be paying Pension Credit to at least 3.2 million pensioner households, while maintaining a focus on the most disadvantaged by ensuring that at least 2.2 million of these householders are in receipt of the Guaranteed Credit””." We know that 1.7 million pensioners are not claiming pension credit, more than half of whom are living in poverty. How close are the Government to the 2008 target? More importantly, what research have the Government done on the effect of the regulations? An up-to-date survey published in September entitled Flagship or Flagging? The Impact of Pension Credit Five Years On found that one in eight of older people had not heard of pension credit; that one in six over 80 was unaware of it; and that one in six of those nearing retirement is unaware of it. The department's impact assessment seems to agree with that. It states: "““Older pensioners are more likely to be affected by the proposed rule change. In 2006/07 older pensioners were more likely to backdate their claims than younger pensioners and were also more likely to do so for the maximum 12 months””." As I understand the figures—I am sure that the Minister will take great delight in correcting me if I am wrong—about £2.8 million is available in pension credit for the 1.8 million people who are not claiming it. If they took it up, that would lift half a million people out of poverty at a stroke, giving those currently missing out an average of £1,477 a year. Who is to gain from that mishmash of government policy? Certainly not current pensioners, as the noble Baroness, Lady Greengross, noted most forcefully; nor those who should be getting housing benefit, council tax benefit or both, or perhaps all three of the benefits that we are discussing. The Minister must be heartily relieved that my party still stands by the convention that prevents me praying against the statutory instrument. It is so damaging to the poorer members of our society that I am surprised that noble Lords on the Liberal Democrat Benches have not done so. The noble Baroness, Lady Thomas, regarded this as a forceful Motion. I beg to disagree. Perhaps she will explain when she winds up. It seems to me such a vote-loser that the Government should have second or, as the proposal has already been abandoned once, third thoughts as to whether the tiny gains outweigh the undoubted damage that the regulations will do to the poorest members of our society. Is the game worth the candle? Now is hardly the time to reduce the time limits for claiming and backdating pension credit, for example, unless of course the Government have given up on the pensioner vote.