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

I beg to move amendmentNo. 197, in schedule 4, page 65, line 30, leave out paragraph 6.

The purpose of this amendment is to clarify further the Government’s intentions about applying the employment and support allowance regime to existing claimants of incapacity benefit and of income support on incapacity grounds. The Minister made some reference to that matter in replying to a previous debate, but a number of issues could usefully be clarified.

There has been some confusion about the plansto move existing IB and existing income support recipients once employment and support allowance is introduced. The Green Paper indicated that the ESA regime would apply only to new claimants, although the response to the consultation stated that existing claimants would be migrated across to ESA in time. That has been the approach that the Minister has taken in his comments to the Committee.

The amendment proposes to leave out paragraph 6 of schedule 4 to probe the Government’s intentions. That provides for regulations to include the migration of existing recipients on to the ESA regime. According to paragraph 307 of the explanatory notes, migration can be voluntary or mandatory. In Committee, the Minister stated that

“those who are most recent to the benefit should be those most likely to have the opportunity to get back to work”

and that the Government have

“looked for ways in which to migrate the newest ... claimants on to the new ESA.”—[ Official Report, Standing Committee A,17 October 2006; c. 42.]

Can the Minister clarify whether that refers to the approach that has been taken in the existing pathways, where existing claimants are gradually invited to attend pre-mandatory work-focused interviews? Is that what is meant by mandatory migration, where the choice between mandatory and voluntary is spelled out?

The change in regime from either incapacity benefit or income support on grounds of incapacity to employment and support allowance will obviously impact on claimants in a number of different areas: the income they receive, work-related conditions, the access to employment opportunities to which they are subject to and the means by which their continuing entitlement to benefit is assessed and reassessed. There are some points in each of those areas on which I would welcome some clarification from the Minister.

On incomes, the Government’s response to the consultation on the Green Paper stated that

“existing claimants’ benefit levels will be protected.”

Does that refer to when an existing claimant is migrated to ESA? We have not discussed rates in this Committee, for obvious reasons. It has been made clear repeatedly that ESA is likely to be higher than the current long-term rate of incapacity benefit. The Minister might wish to confirm that in his remarks. I do not wish to probe him on how much he expects it to be, because at this stage it is hard to know. A single person over the age of 25 on income support with a disability premium could receive a total of £81.95 a week at the moment. Would the income level of someone receiving more now than they would under ESA—if he can imagine any such cases—be protected?

I will not go into detail about work-related conditions and employment, but there is clearly an issue about people who have been on incapacity benefit for a long period. The Minister referred to the fact that he will be looking to migrate not just new claimants but people with dependent children in the early phase of migration, for the purpose of tackling child poverty—at least I think that that is his intention. That could well include people who have been on incapacity benefit for a considerable period and who have particular issues for personal advisers to deal with. It is  important to make it clear that in cases where people who have been on benefit for a very long time are among those being migrated in the early phase, advisers will have support to work with those people, not least those with severe and enduring mental health problems. Will the Minister clarify that?

The Green Paper and the Government’s response to the Select Committee report anticipated a more systematic review of existing claimants through the establishment of a unit to undertake periodic reviews and ad hoc case checks, which might be followed by personal capability assessments where there is doubt about someone’s incapacity for work. Page 48 of the Green Paper said that it was intended to target a minority of claimants who might seek to prolong their time on a protected level of incapacity benefit. Will the Minister enlighten the Committee as to what progress has been made in setting up that process, and what the plans are for random checks and so forth?

To follow through on how a reassessment might take place for someone who has been migrated to the new benefits, can the Minister clarify whether existing claimants will be subject to revised personal capability assessments when their cases come up for review? If someone is currently on benefits and is migrated to the new benefits, will they have to go through the revised PCA when their case comes up for review? Obviously, they got benefits in the first place through the existing PCA with all its inadequacies, which we debated at some length. I should be grateful if he clarified some of those issues in his response.

David Ruffley (Shadow Minister, Work & Pensions; Bury St Edmunds, Conservative)

I will keep my questions brief. As the hon. Gentleman said, the explanatory notes refer to regulations that could provide for either voluntary or mandatory migration. It would be extremely useful and important to understand what would influence Ministers to take the voluntary route as against the mandatory route. I know that there are two options, but it would be useful to understand why they are there.

The second question relates to the financial terms on which the migration, whether voluntary or mandatory, will take place. For someone who was, before the commencement of this Act, on good old-fashioned incapacity benefit, it seems logically to be the case that, on migrating to ESA, they will go on to the new higher rates. There is a question attached to that.

When the migration takes place, existing claims on IB migrate on to ESA at the higher rates. Does it not follow that an IB claimant who, for the sake of argument, passed a PCA at the beginning of 2008—weeks before the commencement of the Bill—and then migrated on to ESA would in the act of migration have to have an assessment under clauses 8 and 9? If they were in the work-related activity component, would they have to take the test in clause 10? It seems that the regime would have to be repeated for the IB claimant who passed the PCA a matter of weeks before the commencement of the Bill. Otherwise, there would be no way in which the higher component for support or work-related activity could possibly be awarded, unless the migrating IB claimant had gone through the full panoply of the new ESA regime.

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

The hon. Gentleman has illuminated one of the points that I was trying to make. Has he also considered the fact that in the situation he is describing, the roll out of pathways to work will have taken place, so those people will have an ability to take part in support to pathways to work while not being subjected to the conditionality regime that someone assessed a few weeks later would be subjected to? There is a question of balance and fairness in relation to how those two quite similarly situated payments will be treated.

David Ruffley (Shadow Minister, Work & Pensions; Bury St Edmunds, Conservative)

The hon. Gentleman makes a good point, and in the interests of expeditious debating I will sit down and await with keen interest the Minister’s response to my questions and those of the hon. Gentleman.

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

We are making fantastic progress, which I do not wish to delay, so I will respond to the specific points raised, rather than read out another well-crafted speech. I am glad that my hon. Friend the Member for Ochil and South Perthshire has had the opportunity to have a profile in the Committee—he volunteered and is here because this is something he is committed to and interested in. He would normally fulfil his role for the Minister for Pensions Reform, rather than in relation to employment and welfare reform, so it is important to note that he is here due to his continuing commitment to the issues we are discussing. Unfortunately, we will not have the opportunity to hear his comments because of parliamentary protocol.

Our intention, as we introduce ESA from 2008 onwards based on the national pathways, is that as we migrate the mix of volunteerism and mandatory migration—I will say a few words about that in a moment—we will have a benefit architecture that is relatively straightforward and that, over time, will bring together some of the entitlements and some of the conditionality. However, that would be with the important distinctions that we have already mentioned on current customers of IB not having to undertake work-related activity as a condition of receipt of benefit.

In time, we would like to see new customers coming into the ESA, and existing IB customers in time also being on the ESA. That is our intention as an end point in terms of the simplification of the inactive benefits regime. In terms of how we get there, it is our intention that for someone who migrates on to ESA under mandatory migration in the future, the extent oftheir personal capability assessment, which I think the hon. Member for Inverness, Nairn, Badenoch and Strathspey alluded to, will fall under clause 9. At that point of migration, would not be a full PCA.

The next PCA that an existing customer of IB moving across at the point of mandatory migration would receive would be the next scheduled PCA. There would not be a PCA gateway on entitlement to ESA per se. As I am sure hon. Members would accept, there would, quite rightly, be a PCA gateway based on the clause 9 aspect to ascertain whether that existing IB customer—who may be in an exempt or non-exempt category—should be in the support group or the work-related activity group. Clause 9 deals with the aspect that would determine that. I hope that that answers a number of questions.

On volunteering, the Bill allows migration on to the ESA benefit structure, but as we roll out pathways nationwide between now and 2008, it is our intention to enable current IB customers to volunteer for the pathways-style support, with the six work-focused interviews. To enable that volunteering and the mandatory migration at a later point, we shall build on the best experience of the current roll-out of pathways and the various pilots that we have spoken about in some detail.

One of the best examples is perhaps the pilot in Somerset, which has not only started with recent IB, but gone right through the current case load. We shall learn from that. Our instinct is to enable the mandatory migration through time, based on what we think we know already, which is that the most recent and freshest claims are by the folk who are most likely to be supported to get back into work, the additional point being about the impact of child poverty and, therefore, migrating folk with dependent kids.

However, we will learn from the experience of the pilot in Somerset—predominantly there, but not exclusively so—about what has been the most successful way of supporting a significant number of customers to come off IB and go into work and economic activity. My point is that we are not dogmatic, and over time there might be a play-off between child poverty and length of time on benefit. Our approach is to go with what works.

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

That approach is sensible. Does the Minister envisage a time when all existing claimants will have been migrated or does he think that there will be some categories of existing claimant for whom a migration will never be appropriate?

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

In time—I am not going to say which time, and the hon. Gentleman would not reasonably ask me to—we would expect all customers to be migrated on to ESA, with the distinction that existing IB customers would not have to undertake the work-related activity, but would undertake the work-focused interviews. Through time, as the process evolves to enable those who wish to volunteer for the support that is available to do so, we would expect to have migrated all those who have not volunteered to the new ESA regime—a terrible phrase—with the important caveat of protecting benefit levels at the point of transfer.

David Ruffley (Shadow Minister, Work & Pensions; Bury St Edmunds, Conservative)

On that point, can the Minister be a bit clearer about guaranteeing the benefits at the point of transfer? What will that mean for an IB recipient who migrates on to ESA?

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

The hon. Member for Daventry is not with us, but, to put it into saloon bar talk, the blunt answer is that the cash that they have in their pocket, with whatever additions they currently receive, will be protected at the point of transfer to ESA. The amount that they have in cash terms will be protected.

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

I am grateful for that response and, although I do not wish to take any more of the Committee’s time than is absolutely necessary, I would  like to clarify a couple of points one more time. One relates to the point in the Green Paper on establishing random ad hoc checks and the idea of setting up a unit to undertake them, with a view to targeting the, as the Green Paper put it,

“minority of claimants who...will seek to prolong unnecessarily their time on the protected level of incapacity benefits.”

The other point relates to the PCA and how it will be applied. I take on board what the Minister said about people not being obliged to go immediately through a full PCA under clauses 8 and 9—he clarified the fact that they will have the clause 9 assessment. However, I am thinking about the case of somebody who may previously have been on incapacity benefit as a result of the old PCA and who has been migrated from the existing benefit to the new. At some later stage, they are likely to be called back for a full PCA under the new regime, as described in clauses 8 and 9, and potentially in clause 10.

That person might then discover that they are no longer entitled to ESA because of the revised scoring system, or for another reason. Will such people still have access to the specialist advisers and sources of support that are available under the pathways programme, which they may need by virtue of their condition and from which they may previously have benefited while on ESA?

That may be a difficult question to answer straight away, but it is important that people in that unusual category should continue to benefit from their existing support, rather than being left to the harsher climate—without intending that term to be taken pejoratively—that is applied to claimants for jobseeker’s allowance.

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

I shall be brief, because we can continue the conversation on some of the specifics if we are given the opportunity to do so between now and 2008. The hon. Gentleman is right that we have said that we shall carry out, on a risk-based approach, some assessment of continuing entitlement to benefit. That ties in with the comments made on disqualification by the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Stirling (Mrs. McGuire).

I hope that the hon. Gentleman accepts that, as part of that random approach, we also want to ensure that customers are given the support that the Bill will put in place, which we have considered in our proceedings in the last few days. It is a matter of continuing entitlement to benefit, but also of ensuring that customers get the support that we as Parliament wish them to get. That is an important double-check.

The hon. Gentleman would not expect me to speculate on each and every circumstance. We have all welcomed the new PCA, which will take greater account of mental health, illness, learning disabilities and other conditions, based on the 46 descriptors and the 15 points. We shall consider the most appropriate level of support—not at point of transfer, but under the new PCA—when that is due, and at the point that he identified. It is a conversation to be continued.

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

I am grateful for that further clarification and I beg to ask leave to withdraw the amendment.