Danny Alexander (Shadow Minister and Disability Spokesperson, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

I beg to move amendment No. 151, in clause 4, page 4, line 15, after ‘prescribed’, insert

‘including such premiums as are applicable under paragraphs 11 and 12 of Schedule 2 to the Income Support (General) Regulations 1987’.

Again, I will be brief. I tabled the amendment in order to probe some significant issues of principle and some practical issues which relate to the implications of the proposed abolition of the disability premium for income support. First, I want to clarify the Government’s rationale for abolishing the disability premium and, secondly, to clarify the implications of that abolition for people who may receive it on grounds that are not related to incapacity.

As I understand it, the disability premium for income support that was introduced in 1987 will be absorbed into either the support or the work-related activity components of the employment and support allowance. In a previous Committee sitting we talked briefly about questions arising from benefits implications, about the implications of moving towards a single working-age benefit and about the distinction between benefits that are designed to meet people’s extra costs and those that are designed to compensate for lost income.

My understanding is that the disability premium for income support was, at least in part, designed to help to meet the extra costs faced by people with disabilities. However, the implication of the change proposed in the Bill is that for the vast majority of recipients it will be replaced with a payment that will be conditional on work-related activity, as it will be a work-related activity premium in respect of the employment and  support allowance. I should be grateful if the Minister set out, briefly but clearly, the Government’s rationale for making such a significant conceptual change in the purpose of the payment.

Tim Boswell (Shadow Minister, Work & Pensions; Daventry, Conservative)

Does the hon. Gentleman agree that the Minister might like to share with the Committee his thoughts on the likely coverage of the proposal? It is not only the definition but the effect in practice that will interest the many people involved.

Danny Alexander (Shadow Minister and Disability Spokesperson, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

I am not sure that I can comment on what the Minister might like to do, but I would certainly like him to do that.

Moving on from that principle and rationale, there are some practical implications, particularly for people who are currently, or may in future be in receipt of the disability premium on grounds not related to incapacity. I would be grateful if the Minister clarified briefly the implications of that change. First, will people on means-tested employment and support allowance still be able to receive the disability premium if they qualify for it on other grounds, for instance, if they are registered blind or receiving disability living allowance? Currently, about four in 10 people on incapacity benefit also receive disability living allowance.

Secondly, will employment and support allowance recipients be entitled to a disability premium for their housing or council tax benefit? For employment and support allowance recipients, what will happen to the currently more favourable treatment for people receiving the disability premium such as access to linking rules in relation to benefit, being able to study full-time—returning to a debate we had earlier in Committee—and having a higher earnings disregard, which is £20 rather than £5?

The last question I should like the Minister to address is: will people on other benefits such as means-tested jobseeker’s allowance, or carers or lone parents on income support—in other words, those not in receipt of ESA or IB at the moment, or ESA in the future—still be able to receive the disability premium? In other words, will it still exist for those other classes of benefit recipient? I would be grateful if the Minister clarified those matters.

Jim Murphy (Minister of State (Work), Department for Work and Pensions; Renfrewshire East, Labour)

I shall seek, of course, to respond briefly so that we can move the proceedings on.

As we have discussed in Committee already, employment and support allowance is a different way in which to provide financial support to those whose medical condition has been assessed objectively and who are entitled therefore to the new employment and support allowance, either at the work-related activity rate or support group rate. The Committee has spoken about that at some length already.

I think that the hon. Gentleman has acknowledged in previous contributions that ESA cannot be compared directly to past systems, in respect of incapacity benefit. When a claimant meets the personal capability assessment threshold, the new benefit will allow a work-related activity component or support  component to be payable after the initial 13-week assessment phase—on the fourteenth week of the claim. That is considerably earlier than in the current arrangements in which the higher benefit rates are payable after a year of incapacity. That is an important change and deserves to be highlighted. It will provide financial support for people away from work for longer.

The new structure will support better those for whom we aim to provide that financial support and encourage those with a limited capability for work to engage in work-related activity, where appropriate of course. Current customers will have their benefit levels protected at their existing rate, and new customers will have their ESA set above the long-term IB rate.

The hon. Gentleman is correct to say that the disability premium does not form part of the new ESA for reasons that we have discussed in Committee already. However, I can confirm that if those on ESA meet the qualifying conditions, they can qualify for the severe and enhanced disability premiums. That is how I understood his questions. The new system will be based on those criteria.

I hope that that explanation has reassured the hon. Gentleman about what people could still be entitled to and again confirmed the structure of the new benefit system in terms of the work-related activity and support groups. I have given the additional commitment that current customers will have their benefits protected and that new customers’ benefits will be paid above the current long-term IB rate.

Danny Alexander (Shadow Minister and Disability Spokesperson, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

Can the Minister clarify whether people in receipt of means-tested employment and support allowance will still be able to receive the disability premium if they qualify for it on other grounds, such as those not related to incapacity?

Jim Murphy (Minister of State (Work), Department for Work and Pensions; Renfrewshire East, Labour)

It is my understanding that that will not be the case, but that those people will qualify for the benefits to which I alluded in my earlier contribution.

Danny Alexander (Shadow Minister and Disability Spokesperson, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

I am grateful to the Minister for his response. I shall probe the issue later, but I beg to ask leave to withdraw the amendment.

Danny Alexander (Shadow Minister and Disability Spokesperson, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

I beg to move amendment No. 5, in clause 4, page 4, line 19, leave out subsection (3).

The amendment is designed to probe the Government’s intentions. Paragraph 59 of the explanatory notes to the Bill gives a comparison by citing paragraphs 7 and 8 of schedule 7 to the Income Support (General) Regulations 1987 that prescribe nil amounts of benefit for certain classes of people. The examples given in the explanatory notes cover certain prisoners and members of religious orders who are fully maintained by their order. I agree that, in both cases, a nil amount would certainly make sense. However, the Bill contains an open power that could be used in many ways. It places no restriction on how the nil-amount regulation could be used in practice.

I should be grateful if, in his response, the Minister could confirm that the categories of prisoners and members of religious orders fully supported by their order that were given as examples in the explanatory notes were the only circumstances in which he foresees the power being used. If not, can he give the Committee an idea of how the scope for the use in practice of the regulations would be limited? It is important that that is made clear for the Committee.

John Robertson (PPS (Dr Kim Howells, Minister of State), Foreign & Commonwealth Office; Glasgow North West, Labour)

Will the hon. Gentleman clarify his argument? If his amendment were successful, would he be happy that that would allow prisoners to receive support and allowances?

Danny Alexander (Shadow Minister and Disability Spokesperson, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

No. I am grateful for the hon. Gentleman’s intervention as it allows me to clarify my point. The examples of when to allow a nil amount to be prescribed are reasonable. The purpose of the amendment is merely to probe the Government’s intentions as to whether they want to use the power in a wider class of cases.

Tim Boswell (Shadow Minister, Work & Pensions; Daventry, Conservative)

Clearly, I support the hon. Gentleman in his wish to probe such matters. I wish to make two points—one narrow in application and one that is more general. The narrow argument has been emphasised by my hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond) in several parliamentary questions. It is that the Department for Work and Pensions has, to put it mildly, not a good record at capturing, recovering or stopping the payment of benefit when persons are in prison. I accept that we should not debate that issue today, but I hope that the Minister will bear it in mind.

As for my general point, it would be helpful if the Minister could communicate at leisure with members of the Committee about foreign entitlements. I do not wish to signal a negative view about such matters. I have a neutral view. Many foreign people of working age come to this country because they are from countries that are now members of the enlarged European Union. Many of those people seek work, although it is unlikely that, in respect of those from Romania and Bulgaria, they shall be able to obtain it without separate work permits. I am not clear about their entitlement under the arrangements. The issue has not been widely rehearsed. It would be useful if the Minister could take that point away, reflect on it and advise members of the Committee about who would be entitled to claim such benefits. I am not talking about people who are in prison, but the wider class of people. Will he say in what circumstances that would be curtailed and withdrawn? It is easy for people to go into the saloon bar and share views about such matters, but it important that the matter is clarified.

Jim Murphy (Minister of State (Work), Department for Work and Pensions; Renfrewshire East, Labour)

In the spirit of this morning’s sitting, I shall respond briefly to the specific points that have been raised so that progress can be made. I was relieved on behalf of the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) when he sought to emphasise early in his comments that this is a probing amendment. Giving prisoners the vote is bad enough, but giving them benefits would be even worse.  

The hon. Gentleman is on the right of his party, so I have no idea whether he speaks for the whole of it. In an uncharacteristic way for current Liberal Democrats, he seems to be at least tempted by some sense of responsibility as well as an enormous sense of enhancing rights in legislation. He knows that I say that in a jovial manner. Unusually for a Liberal Democrat, he comes close to trying to balance the demands for ever-extending rights with at least a modicum of extending personal responsibility. All Committee members should be grateful for that. We are relieved to hear that the Liberal Democrats do not appear to be advocating benefits for prisoners.

Danny Alexander (Shadow Minister and Disability Spokesperson, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

I do not wish to clarify my position within my party, because that is a matter for others to speculate about. However, just for the avoidance of any further doubt, I make it clear that I am not advocating that prisoners should have benefits. I would have hoped that the Government press officer who briefed one of the newspapers to pass questions on about this issue would have sought, in the same manner that the Minister has, to be generous about the intentions behind the amendment.

Jim Murphy (Minister of State (Work), Department for Work and Pensions; Renfrewshire East, Labour)

None of us will speculate where the Liberal Democrats will end up on this issue. I guess that they will end up in all sorts of different places, as they do on many other issues. However, I suspect that your patience will run out shortly if we continue along this line of debate, Mr. Hood.

We use the current power in legislation in relation to members of religious orders, where they are fully maintained by that order, prisoners and people from abroad. People in those situations are provided for by other means and should not get an income-related benefit such as income support or income-related employment and support allowance. The amendment would have the opposite effect by removing our ability to act. Without this power, we could not prevent people in the circumstances that we have alluded to in the explanatory notes from receiving ESA.

I can confirm that the examples that the hon. Gentleman cited, in addition to the one raised by the hon. Member for Daventry (Mr. Boswell), are the areas where we wish to use this power: in relation to religious orders, prisoners and those from abroad who have no entitlement and meet no qualifications in respect of ESA.

Danny Alexander (Shadow Minister and Disability Spokesperson, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

I am grateful to the Minister for clarifying that, so I beg to ask leave to withdraw the amendment.