New Clause

Part of Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 3rd July 1968.

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Photo of Mr William Worsley Mr William Worsley , Chelsea 12:00 am, 3rd July 1968

I beg to move, That the Clause be read a Second time.

The House will be grateful to you, Mr. Speaker, for allowing us to debate the new Clauses together because they all cover points relating to disability. The Minister of State seems to be in that situation; I hope that it is nothing serious.

This is the only chance which we shall have during the passage of the Bill to do something constructive to ease the burden on the mentally and physically disabled, with whom we all have sympathy. Clearly, there will not be debate across the Floor of the House about that sympathy; the debate will be about how to help them. In times of economic crisis, like the present, that in itself is no reason to exclude from our consideration subjects like the one dealt with by the new Clause. These people still deserve our sympathy and help through the Bill.

The new Clause has a double purpose. Some of the other Clauses which we are discussing relate to only one of these two purposes. We are proposing that, first, the existing blind person's relief should be brought up to date, and, secondly, the relief which is paid only to the blind should be expanded to a general relief for disabled people.

I wish to start by discussing the first of those two aspects, to which new Clause No. 113 is related. The figures are simple. This relief was introduced in 1962 by the Conservative Government. Taking the base of 100 in January of that year, the cost-of-living index, which must be the indicator which we use in these matters, had risen in May this year to 124·9— 125 in round terms. The House will know how much of this increase has been the result of Labour Government and that the steps taken by this Government during the current year and earlier years have deliberately increased the cost of living.

We propose to increase the relief to £130, because we have no confidence whatever that the rise in the cost of living is likely to stop in the immediate future. Indeed, all the policies of the Governent make it absolutely certain that it will continue. To be precise, we should increase the relief to £125, but we have proposed the figure of £130.

When the Royal Commission on Taxation of Profits and Income recommended such a disability relief in 1954, it advocated that it should be not less than £100. As far back as 1954 it was thought that £100 was the absolute minimum. Here we are in 1968 and the £ is very much less valuable. Of course, if the Minister says now that he is quite happy to accept £125, I think it likely that my hon. and right hon. Friends will accept that with pleasure, but the point is that the relief introduced in 1962 has lost an appreciable part of its value. It is, after all, a relief not of very wide application, a relief confined to people who need it, and it is a relief, I must remind the House, which helps a category of people who are not currently helped through the National Insurance scheme—and that I shall return to in a minute.

There is an overwhelming case at least for preserving the real value of this relief for people who are, by definition, in need of help. So the case we make on this Clause is that, whatever else is done, it is only a matter of elementary justice that the relief should be increased to keep pace with the falling value of the £. Of course, I appreciate that these reliefs cannot be valid in successive Budgets; we cannot have a sort of sliding scale; but I do think, and I invite the Minister to agree with me about this, that when the figure has moved as far as this and the cost-of-living index has risen 25 points there is an absolutely overwhelming case for a change.

The second object, to which, if the House will permit me, I should like to devote rather more time, of the Clause is to widen the application of relief. We feel that the time has come to build on the foundation laid by the Conservative Government in 1962, and to move at least some of the way towards a proper overall disability relief. I suppose that different forms of disability excite different amounts of sympathy in different people, but can anyone really argue that a blind person has any greater need of tax relief than, for instance, someone who suffers from multiple sclerosis?

One can enumerate the hard cases easily enough, but surely the fact is that blind people have been selected not because they are in greater need of this relief, but because they are easier to identify. I believe that if there is a case —and I believe there is a case, and certainly both sides of the House have accepted this for some years now—for blind relief, then there must also be a case for relief for other major disabilities.

I should like to quote from the Royal Commission to which I have already referred. It had this to say in 1954 on this matter, that there are many kinds of disability … so severe that they modify the whole conditions of a person's life and impose upon him a constant levy of extra expense that may fairly be said to affect the taxable capacity of his income. … Our general conclusion is that grave disability ought to be the subject of allowance. It presents itself to us as a personal circumstance that sets apart those who suffer from it and directly affects their relative capacity to pay. This, of course, is the criterion on which one must judge a tax relief. There is nothing in that about singling out the blind for special treatment. The Report makes a clear and overall case for a disability allowance across the board.

The Minister will, of course, realise that although we are discussing the question of tax relief, all these tax reliefs, or many of them, have, as it were, their mini-images in National Insurance. I refer, but only briefly, to the fact that many of us on this side of the House who have been pressing for some time for corresponding disability benefit have made just the same criticisms about the present National Insurance scheme, that it helps certain limited forms of disability only; we have made of that scheme criticisms similar to those we are making this afternoon of the tax structure. I mention this because the same problem arises, and I should like to say a word about it.

There is, to begin with, of course, the problem of definition. I would certainly not wish to suggest to the House that this problem of definition is one which can be easily solved. Nevertheless, I should like to make one further quotation —and the House will be relieved to hear it is my last—from the Royal Commission's Report, because in paragraph 203 the Commissioners dealt with this point: '"The difficulty reinforces the need to begin cautiously "— as, of course, was done in 1962, though in a different way— and to confine qualification to 100 per cent. disablement. But we feel at the same time that the difficulty is not insuperable and ought to be faced. Machinery of the kind that we have in mind does in fact exist, though created for the purpose of war pension administration; and some of the qualifications, e.g., blindness, do, as it were, prove themselves. In other words, the Royal Commission, in considering this matter, thought that machinery should be established, and that there were precedents for the machinery, for making the kind of distinctions which we have in mind.

In our Amendment we have used the wording, as the Minister will recognise, of the industrial injuries scheme, and my hon. Friends, in the related new Clause 42, have used the industrial injuries scheme, and also the war pensions scheme, as the machinery for making this sort of decision. We feel that the time has come to move on this matter, that these words, which are well-established now, which have been in use and been in operation for 20 years, could be used as the machinery for making this distinction.

The Minister will, of course, know that the Government are currently carrying out a considerable survey into the whole question of disability. This we very warmly welcome. Such a survey is overdue, and must be valuable, but I hope that the Minister will not use this survey as an excuse for inaction on this matter. The survey will take a long time to complete; it will take a long time to digest when completed. I do not believe that we can wait till the survey is fully completed. I believe that we have reached a stage for a real attack on this problem.

It is, after all, as I said earlier, the only way we can help those in work, and what can be more important in this field than to help those persons who can still keep in work? Naturally enough, many of these people find it difficult to earn high remuneration; others, of course, cannot succeed in finding work at all, but where there is a possibility of work surely that should be encouraged. So we do not believe that the kind of cash benefit that we have in mind for disability is an alternative to a tax relief of the character we are mentioning. On the other hand, we feel that it is something that will run together with it very well.

4.0 p.m.

I also hope that the Government will not use the classic argument for doing nothing, namely, to start talking about borderline cases. It is always easy to make a nonsense of almost any improvement by saying that there is a case on the borderline which produces hardship. There are always borderline cases which are difficult, but if we use this argument across the board we would have hardly any benefits and hardly any tax reliefs at all.

Surely the important thing is to tackle the substance of the problem and if, in the working of the scheme, there are found to be difficulties on the borderline, perhaps we can put them right later. However, this should not be an argument against any improvement in the scheme. If the Government can come forward with a better definition than we have succeeded in doing either in this new Clause or in any other new Clauses on the Notice Paper, we shall be only too delighted to accept it.

We are trying to establish two principles in this Clause. The first principle is that when a tax relief of this character has been allowed and, largely through Government policy, has become eroded, then it is time that the Government took action and accepted a variation in the rate of tax relief.

Secondly, the story which I have tried to unfold of the initial recommendation of the Royal Commission's Report for a disability tax relief, followed by the introduction of a partial scheme in 1962, all adds up surely to an unanswerable case to widen this provision so that it covers the whole, or at least the greater part, of the disability sphere. This is what we urge the Government to do. This is why we have put down this Clause.