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The purpose of this Bill is simply stated. It is to correct a technical defect which recent legal advice has identified in the Social Security Act 1986.
The essence of the advice that we received is that the Act does not give the power we believed existed for the Secretary of State to prescribe in regulations the amount to be paid in maternity and funeral payments. The other prescriptive powers necessary for this policy—notably to determine the circumstances of entitlement to payment — seem clear and undoubted. This deficiency came to light following scrutiny of regulations under the Act by the Joint Committee on Statutory Instruments.
As the House knows, the 1986 Act encompassed the most substantial set of reforms to the social security system for 40 years. Today's Bill, by contrast, fits on to one sheet of paper. That, at least, should commend it to the House. Nevertheless, despite its brevity, the Bill is essential if we are to direct effective help with maternity and funeral costs where it is most needed.
I am in no doubt that the present arrangements for help with maternity and funeral costs are inefficient and in need of reform. It might be helpful if I set out why that is so together with our proposals for the future.
On maternity payments, the social security system has long recognised the self-evident truth that a baby leads to extra expense. But the current system is clearly unsatisfactory. On the one hand, there is the universal maternity grant of £25. That is expensive in global terms because it is available to everyone, irrespective of their income. But equally it is inadequate because it does not give sufficient help to people on very low incomes. Successive Governments have given the grant such low priority that it has not been increased in value for nearly 20 years. The result of that is that it is now worth a fraction of its original value and it is also disproportionately expensive to administer a very large number of small grants. On the other hand, there are supplementary benefit single payments—based on the practice of totting up the need for each item down to nappies and a plastic bottle. Those payments can be considerably higher but they are restricted to people on supplementary benefit. Those in work on low incomes cannot get any such help at all and rarely have been able to do so in the past, although the Supplementary Benefit, Commission in the 1970s may occasionally have made available discretionary payments.
For funeral expenses the picture is similar. Here, too, there is a universal grant — the death grant — paid irrespective of income. But that grant is only £30, and has been frozen at its present rate even longer than the maternity grant. That speaks volumes for its relevance today. When the death grant was originally introduced. it was intended to pay for a simple funeral, but clearly £30 is quite inadequate for that today. The vast majority of people pay for funerals largely on their own, and for them the death grant is an ineffective irrelevance. Despite its individual irrelevance, it is in global terms an expensive irrelevance simply because it is paid to so many people. As with the maternity grants, it is disproportionately expensive to administer in relation to the benefit actually paid out to individuals. It also gives far too little help to those who genuinely have difficulty paying for a funeral and whom we wish to assist more generously. The only people who can get help with the full cost of a funeral ate, again, those on supplementary benefit. People on low incomes in full-time work, or pensioners just above supplementary benefit levels, are excluded. The death grant has in its present form, therefore, almost every imaginable disadvantage.
I think that there is almost general agreement — I never expect full agreement — that the arrangements I have just outlined are satisfactory. We recognised that in the Green Paper on reform of social security in mid-1985 and decided to replace those arrangements with a more rational system. The solution that we proposed was to concentrate help with maternity and funeral costs on people with low incomes, whether in or out of work, and to pitch that help at a reasonable level.
The detail of our proposals for maternity and funeral payments was developed as we moved on from the Green Paper to the White Paper and then to the very extensive debates on the passage of the Social Security Bill both in Committee and on the Floor of the House last year. But throughout that the essence of our proposals has been well known from the outset.
In respect of maternity assistance, we are proposing a flat rate amount which will make a reasonable contribution to the cost of providing for a baby. Shortly before Christmas I announced that the amount would be £80, being slightly more than three times as much as the current maternity grant. The criteria for payment of that will be straightforward. Those on supplementary benefit or family income supplement will be eligible, subject to the usual rules on capital. From April 1988, recipients of income support or family credit will be eligible in the same way, thus enabling us to avoid the need for a separate income test, and I think that will be generally welcomed. We intend that the payments will be publicised and applications can be handled simply by post where that is desired.
We have aimed specifically at relatively simple arrangements, picking out the best of supplementary benefit or maternity grant rules, as the case may he. It might be useful to illustrate that point. For example, people will be able to get maternity payments from 11 weeks before the expected birth to three months afterwards — like the maternity grant but rather more generous than the supplementary benefit limits. On the other hand, people will get maternity benefits for adopted babies—unlike maternity grants but like supplementary benefit. I hope that, whatever other differences may emerge this afternoon, the House will acknowledge the logic and fairness of that approach.
There are two further points I would wish to stress about these maternity payments. First, they will be grants and not loans. Secondly, the payments will not be constrained by the budget of the social fund. If someone meets the criteria, she will get help. I stress these points because, despite the fact that we have made them very clear over the last year or so, there seemed to be some misunderstanding in the mind of the hon. Member for Oldham, West (Mr. Meacher) when I announced a few days ago that we would be introducing this Bill. The hon. Gentleman on that occasion still referred to
Loans for maternity and funeral expenses
and to "cash limiting".
I say to the hon. Gentleman that that is wholly wrong in terms of our proposals and I am surprised that he should have made that comment after the extensive debates we had on the subject last year. Perhaps the hon. Gentleman will explain that lapse when he speaks.
I am grateful to the Minister because I think it is now clear that maternity and funeral expenses will be grants but it appears that other payments from the social fund will be loans. I hope the Minister will be able to answer this question before he concludes his speech. We know the fund will be cash limited. Let us say the sum is X million pounds a year cash limit. Will that be paid into the fund each year? If it is, given that most of the payments from the fund will be loans, is it right to assume that the fund will grow considerably in size each year?
We shall be making announcements about the size and operation of the fund when we finish further consultation work that is still continuing. Insofar as earlier points about grants are concerned, the maternity and funeral payments will be paid in the fashion I have set out. In terms of much of the rest of the social fund, it will be loans, although there is also the community care aspect within the social fund which will be grants and not loans. One can foresee circumstances where people such as those we shall be concerned with this afternoon may find themselves qualifying for grants under that aspect of the social fund as well. We have a great deal to debate, no doubt at a fairly early stage, on matters of that kind.
I am grateful to the Minister. I appreciate that there is further discussion to go on and we wish him well with the Treasury in that discussion. Following on the point of principle raised by the hon. Member for Birkenhead (Mr. Field), what about the practical impact on people on supplementary benefit or other forms of state benefit under the social fund? If they are given loans, how will they pay them back? It is a practical question that has never been adequately answered.
We had extensive debates on the social fund during the Committee period in which it was made clear that the loans would be recoverable from future benefits paid to those who take the loans. That is not a novel proposition but was set out in great detail during the passage of the Bill upstairs. That principle is well understood in the House. We still have to debate, no doubt at a further stage, the detailed operations of the social fund when the size of the budgets and related matters are determined.
I concede that that was the point underlying the observations made by the hon. Member for Birkenhead (Mr. Field), but the basic principles of what is determined and how it will be repaid has been known for some time. Of course, to an extent it will depend on the underlying weekly income benefit rates, which will be set in the autumn of this year, to take effect from April 1988. The hon. Gentleman is well aware that until we reach the normal uprating period no one can be entirely certain what the income support and the other relevant rates will be. I acknowledge the point raised by the hon. Gentleman. The levels of those rates will be important and on that point I need no instruction from anyone. In any event, I again stress that we are talking of grants, not loans, because I know that even now — [Interruption.] The hon. Gentleman has just indicated it again —there may be some misunderstanding on those points and I wish to see those misunderstandings removed.
I am grateful to both hon. Gentlemen for letting me reiterate the precise circumstances in which the maternity and funeral payments will be made, the nature of those payments, and in particular the non-repayable nature of those particular payments.
It might be useful to turn to our proposals for help on funeral costs. These proposals will allow everyone on low incomes to pay for a funeral if they do not have the resources to do so, which is something that the present arrangements patently fail to do. We are proposing to pay the full cost of a reasonable funeral. The arrangements will be not unlike those which now operate for some people on supplementary benefit. The big difference is that we are extending such arrangements to other low income groups — that is to say, specifically, to people arranging funerals who are on family income supplement or housing benefit as well as those on supplementary benefit. From April 1988, similar arrangements will apply to those receiving income support or family credit. I hope it will be generally recognised that that is a very significant increase in the amount of effective help which will be made available. I hope that the House in general and the Opposition Front Bench in particular will be inclined to acknowledge that, although I appreciate that they will have other points of difference with us this afternoon.
Under the arrangements that we propose, the lady in those circumstances would be able to have assistance from the fund and would not have been required to borrow that money in the first instance. That illustrates one of the improvements in this system and I think that will be generally helpful. The problem raised by the hon. Gentleman may have other ramifications. Insofar as they affect supplementary benefit matters, if the hon. Gentleman cares to give me their details I will have them examined for him as speedily as possible.
This proposal means that the number of people who will have cover—I emphasise the word cover—for the
cost of a reasonable funeral, assuming they have no other resources to meet the cost, will be increased from about 4½ million to about 8 million. That is why I felt that the hon. Member for Oldham, West, who is engaging in a seminar with the hon. Member for Birkenhead, was mistaken when he spoke the other day about me
insisting on taking powers to cut funeral payments to pensioners and others
forcing more and more of them to build up savings for their funerals."—[0fficiat Report, 22 January 1987; Vol. 108, c. 1043.]
In fact, we are doing precisely the opposite and our proposals will greatly help many people on low incomes. Once again, because of the misunderstanding in the House and beyond—[Interruption.]
The seminar my hon. Friend the Member for Birkenhead was giving me was on this very point. Surely it would make a difference to poor old people being scared about dying only if the grant is paid to other people outside the range of categories that the Minister has spoken about, people who are not on benefit. As I understand the arrangment, people will qualify only if the person who is being buried is poor, not if they are in the other categories. Am I wrong on that?
I would wish to look at the precise details of the difficulties faced by the constituent of the hon. Member for Coventry, North-East (Mr. Park). We are extending the availability of substantial practical assistance with the funeral costs of someone for which a person has responsibility from a cover of 4·5 million people to a potential cover of 8 million people. No doubt the hon. Gentleman will seek to develop his argument on Monday, but that is the practical underlying effect of the Bill.
With regard to the figure of 4 million, most of those who will lose the entitlement are old people, most of whom will die fairly soon and will therefore be eligible for the grant. The figure of 8 million is based on those on specific benefits, many of whom are not old and are unlikely to die in the near future. So it is misleading to give those two figures.
I think not. The only people who will find themselves at a practical disadvantage are those who do not fall into the qualifying groups, who will lose the £30 flat rate grant.
That may or may not be. If widows are in poor circumstances we wish to help them. Our proposition will offer them more substantial help than before. The £1,000 widow's payment which comes into effect in 1988 is entirely disregarded for capital purposes. The principal loss for a person will simply be the £30 flat rate grant. The gain will be for those on low incomes, who will find that the full cost of a funeral will be met. These days, in any part of the country, that would rarely be less than £350 and would probably average £550. To the many people who worry deeply about meeting that cost, the practical effect of what we are doing will offer considerable comfort. I think that the hon. Gentleman will welcome that.
Will my hon. Friend confirm that after April the £1,000 to which any widow would be entitled will be disregarded? Will he further confirm that, with regard to the constituent of the hon. Member for Coventry, North-East (Mr. Park), any house that the widow may have been left by her deceased spouse will also be disregarded when assessing funeral costs?
It may be that the estate of the deceased, when it is realised, will have the resources to pay for the funeral. As at present, the cost of the funeral will be a first charge on the estate and will be recovered. But it will not, under any circumstances whatever, be recovered from the person who had the loan to carry out the responsibility of arranging and paying for the funeral. Under no circumstances would it be recovered from the person who paid for the funeral upon receiving a loan, but it could be recovered from the estate at a much later date when the estate is proved, if it had the resources in it. I emphasise that the person borrowing the money may be sure that he or she will not be required to repay the money. I think that that was the underlying anxiety in the hon. Gentleman's mind.
Once again, I must point out that we are not seeking to cash-limit the funeral payments. They, too, will be made to those who meet the criteria without regard to any budget. The payments will not be loans to be recovered from the applicant's own resources. In order to direct effective help where it is most needed we shall, first, take account of sums to be put towards the cost of the funeral and the capital disregard limit. That is in line with current traditional arrangements. We have also made it clear that the lump sum payment of £1,000 proposed for widows will be disgregarded in full. I hope that that is beyond doubt.
Secondly, we have said that if the estate of the deceased —the point referred to by the hon. Member for Ealing, South (Mr. Bidwell)—when it is settled, turns out to have money in it to pay for the funeral, the payment will be recovered from that. That is, of course, a long-standing principle that funeral costs are the first call upon the estate of a deceased. However, that is a substantial improvement on the present supplementary benefit arrangements whereby help is not given in the first place if there is sufficient money in the estate. I suspect that that is the point that prompted the hon. Gentleman's question. We have eased that and are giving people without sufficient resources of their own the confidence that a payment for funeral costs will be made when needed, with recoveries from the estate, if appropriate, taking place later. I emphasise again that the recoveries will be only from the estate. There is no question whatever of the funeral payments being loans to be recovered from the present or future income of the applicant.
I am grateful to my hon. Friend for giving way again. If someone is eligible for supplementary benefit and housing benefit but does not receive them, perhaps because he has not applied, would he still be eligible for funeral expenses?
The logic of our proposals is that such a person would be eligible, but I shall check that important point and write to my hon. Friend if what I have said is not accurate.
The new arrangements for help with funerals will be handled as sensitively as possible and with the minimum of detailed questioning. By using income-related benefits as "passports" we shall avoid a separate income test. That will be generally welcome and helpful. Moreover, we are also cutting some of the detailed rules now existing in the supplementary benefit arrangements which concern the relationship of the person arranging the funeral to the deceased and which "deem" contributions to the cost from other family members. Such unnecessary difficulties will go and I for one will be glad to see the back of them. In future, people will be able to apply for help by post or in person as they wish.
Those then are our proposals and they represent a substantial improvement on the present situation. However, as I set out in my statement last week, it is clear that a few vital words necessary to implement the policy were omitted from the 1986 Act and that is why we have introduced the Bill.
The Bill has only two clauses. The first seeks to amend the 1986 Act to remedy the defect I have described. It simply enables regulations to be made, not only to prescribe who should get help with maternity and funeral costs, but how much that help should be—whether in relation to particular times of expenditure or otherwise.
The second clause contains the short title—the Social Fund (Maternity and Funeral Expenses) Act 1987. It also contains a wholly standard provision—similar to that in the 1986 Act—relating to Northern Ireland. This would enable an Order in Council to be made, subject to the negative resolution procedure, for purposes corresponding to this Act.
That is it, as far as the Bill is concerned. It is as brief and as straightforward as that. We shall also—as I told the House the other day—revoke the regulations which were queried by the Joint Committee on Statutory Instruments on grounds of vires. Subject to Parliament's agreement, we intend to lay a fresh set of regulations along similar lines in due course under the powers which this Bill is designed to provide.
The purpose of the Bill is to enable the much-needed reform of help with maternity and funeral costs to go ahead as intended from April this year. I do not believe that it would be right to abandon that reform simply because of a technical error, unfortunate though that error may be. The right answer to a problem like this is to find a straightforward solution. That is what we have done with this Bill.
To sum up, there is no doubt that reform is urgently needed. There is no doubt that the proposals I have outlined again today mean that we shall direct effective help to those who really need it. Those most in need will get most help. That must be the right policy and this Bill will enable us to achieve it. I commend it to the House.
This is a little Bill, almost incomprehensible in its drafting. However, it raises two fundamental issues. One is the abolition of the contributory principle which, before this Government came to office, was always a foundation of the welfare state. The other issue is the operation of the social fund, which remains the most objectionable element of that thoroughly objectionable piece of legislation passed last year, the Social Security Act.
For the last 40 years, the contributory principle has been central to the social security system. It was the cornerstone of the Beveridge plan in 1942 when he wrote:
It is, first and foremost, a plan of insurance—of giving in return for contributions benefits up to subsistence level, as of right and without a means test, so that individuals may build freely upon it.
It is this which the abolition of the death grant and the maternity grant under this Bill will destroy. This point was made rather forcefully to me a few weeks ago by a former constituent. He wrote to me an entirely unsolicited and aggrieved and angry letter from which I shall quote:
Before I retired I was manager of Oldham DHSS and in that capacity I often corresponded with you. You may, therefore, be concerned at the moral and legal implications of the proposed abolition of the contributory death grant. I paid for death grant from 1948 until I retired and then had no more liability for such contributions. The fund, however, still had a liability to pay out on my death. In commercial terms I had a paid-up policy and had it been with a friendly society, the money would be safe. It is this policy that the Government unilaterally intends to abolish.
Any private company doing this would be taken to court and convicted of fraud. Previously when a benefit has been abolished it has still been paid to those already qualified. What will happen to my money and that of millions of other pensioners? It is now in the fund awaiting payment. If you cannot obtain a satisfactory answer for me, I am eager to appeal to the Parliamentary Commissioner.
I shall certainly raise that case with the Minister in an effort to get a reply which satisfies my constituent. I shall pursue the matter if the Minister does not wish to give an answer now.
That correspondent raises a serious point which the Minister did not begin to answer. How can the Government justify unilaterally terminating a right to benefit for which contributions have been made in good faith throughout an entire working life of more than 40 years? The rejection of any such notion and support for the principle of a right to benefit based on contribution irrespective of other circumstances has hitherto been agreed in almost all parts of the House.
I shall quote one right hon. Member who in Committee moved an amendment to the National Insurance Bill to provide all widows aged 32 or over with a minimum pension of 30 shillings a week. That dates it a bit. The right hon. Member was taxed about widows with large unearned incomes from an inherited estate. The right hon. Member replied:
I am dealing with anomalies within the National Insurance Scheme, because under the scheme one gets certain benefits in return for certain contributions. I do not think anyone would say, in dealing with an insurance scheme which gives certain benefits in return for certain contributions—there could be no justification for saying—'You shall not get the benefits because you can afford to look after yourself.' If one has a fire insurance and pays certain premiums and
then one suffers a fire, the insurance company does not turn round and say, 'You are not going to get benefit because you can afford to do the repairs yourself.' This is an insurance scheme". — [Official Report, 3 December 1964; Vol. 703, c.810.]
It is not often that I quote that right hon. Member in support. The right hon. Member who said that is the right hon. Member for Finchley (Mrs. Thatcher), the Prime Minister.
In case any hon. Member thinks that the right hon. Lady's views have changed over the last 23 years, I shall give one more quotation—her reply as Prime Minister to her hon. Friend the Member for Norfolk, North (Mr. Howell). [Interruption.] Perhaps those Government Members who are chanting might like to listen to what their right hon. Friend the Prime Minister said a short time ago. She said:
As my hon. Friend knows, the national insurance scheme is not a mere transfer of income. It is an insurance scheme and one's right to benefits from it depends on the contributions made throughout life. It is important to maintain that link.
The proposal in this Bill and in the Social Security Act 1986 to abolish death and maternity grants is not compatible with insurance logic and proper commercial practice. It is totally inconsistent with what the Prime Minister said 23 years' ago and with what she still says today.
If Ministers are felons for depriving people of monetary benefits that they have earned, at least they are consistent felons because this is not the first time that they have done that. They have been at it for years. No fewer than six national insurance benefits for which people have contributed have been abolished in the last four years, without so much as an apology. The earnings-related supplement to unemployment, sickness and maternity benefit was abolished in January 1982. Industrial injury benefit was abolished and sickness benefit was replaced in April 1983. Child dependency additions to the short-term benefits were abolished in November 1984. The reduced rate unemployment sickness and maternity benefit and industrial disablement benefit below 14 per cent. were abolished in October 1986.
It would not be quite so bad if, having cut the benefits, the Government also cut the premiums, but they have increased national insurance contributions by half as much again—from 6 per cent. to 9 per cent. Any private insurance agency would scarcely stay in business if it offered a deal like that. If that is not bad enough, the Government are now proposing unilaterally to abandon nine more national insurance benefits in the next year or so. Two of them, the death grant and the maternity grant, are the subject of this Bill, but there is a host of others. Children's special allowance is to be abolished and maternity allowance is to be replaced in April 1987. Industrial widows' benefit is to be abolished, widows' allowance is to be replaced, age-related widows' pension is to be abolished, the widows' fund is to be ended, and personal extension of the widowed mothers' allowance is to be abolished, all in April 1988.
Since the hon. Gentleman is so concerned about the insurance principle and has just listed a number of benefits that he claims will be reduced, would he care to speculate on how much national insurance contributions would have to rise in order to meet all the commitments that he believes should be met and in recent weeks has promised will be met?
If the Government had not allowed unemployment to increase by between two and three times, the main reason for the overwhelming inflation in social security costs, it would have been perfectly possible to maintain all those benefits and to have had a lot over.
The Government's attitude to the welfare state is rather like those demolition contractors who are said to make a speciality of legally dismantling buildings on which there are preservation orders. They start by knocking down a fairly innocuous-looking bit but do it in a way that makes another rather more vital bit dangerous. They then call in the district surveyor, who sticks a dangerous structure notice on it and orders them to demolish it forthwith. In doing so, another bit becomes dangerous, so that must be demolished, and so it goes on. Not long afterwards, of course, the whole lot is a heap of rubble. That is what the Government dream of doing to the welfare state. It is not a frontal attack but a constant erosion, nibbling away, bit by bit, until one day the nation will wake up to find that there is little left of any substance.
Originally, the welfare state was envisaged as a redistributive mechanism between the classes. It was intended also to offer high-quality benefits and services, universally available almost as a badge of citizenship. These principles have been allowed to wither as a result of successive actions by the Government. Under the Government, the redistributive principle has been cut right back by constant reductions in the Treasury supplement, financed by all citizens out of general taxation, from 18 per cent. to as little as 7 per cent. That has thrown more arid more of the funding of the welfare state on to working-class people because of the ceiling on national insurance contributions of one and a half times national average earnings, which minimises contributions from the higher paid groups within the middle class.
The principle of high-quality universal benefits is constantly undermined by the Government, partly by the regular elimination of universal benefits, as in the Bill, and, as I have described, partly by the Government's constant practice of making the beneficiaries of the welfare state pay more and more in contributions for a smaller arid smaller range of benefits.
The Bill is a classic case in point. The death grant is to be replaced by means-tested help with funeral costs. It callously ignores the intense emotions that the issue generates in pensioners. The Dignity in Death Alliance has put the matter exactly as that age group feels about it. It states:
members take the view that an insurance principle is at stake. People have paid for this benefit throughout their lives and, as with any other, they are entitled to claim it.
It goes on:
there is a total rejection of any form of means testing at the time of death. This is both personally cruel and grossly expensive. The cost of administering a small financial benefit may be higher than its worth.
The same principle applies to the maternity grant, which is also being abolished. It is somewhat ironic that — I presume that the Minister knows this — it was a Tory Minister who, in 1980, introduced the principle of a universal benefit on the ground that, otherwise, many young mothers would have inadequate contributions to qualify. In addition, a few months later in 1980, the Government published a consultative document called "A Fresh Look at Maternity Benefits" in which all three options that were canvassed involved the retention of a universal maternity grant. If it was right then, why is it not right now? To pose a similar question in a slightly different form, if universal death or maternity grants have always been supported, as they have, by public opinion and indeed by the same Government in an earlier, slightly more liberal reincarnation, why do the Government gratuitously insist on bringing the two benefits within the purview of the odious social fund when there is absolutely no necessity for them to do so?
The other fundamental issue raised by the Bill concerns the operation of the social fund. There are four major objections to the proposal that still are unresolved. The first is the right to independent appeal, to which the Minister, in one of those classic displays of weasel words for which he is becoming famous, referred in his statement in the House a fortnight ago in explaining why the Bill was necessary. On 22 January — he repeated much the same today — he said:
the error arose as a result of an attempt to reflect quickly the will of the other place." —[Official Report, 22 January 1987; Vol. 108, c. 1045.]
The Minister referred to the right of independent appeal. As he probably knows, gratitude in the other place is rather less than gushing, and it is clear why that is so. As was said at the time, it is now proposed that an appeal should lie from the regional DHSS civil servant nominated by the Secretary of State to a senior civil servant, who will not be nominated by the Secretary of State, and that the civil servant should instead be appointed by a commissioner. The question that arises is: who appoints the commissioner? The answer is: the Secretary of State. The commissioner thus appointed by the DHSS will have power to appoint social fund inspectors. Who are they? They are none other than those made available to the commissioner by the Secretary of State. To call that an independent appeals mechanism is to stretch credulity beyond endurance. It is rather like Humpty Dumpty in the Alice-in-Wonderland world of the Minister — "Words mean what I say they mean." That is not convincing for a drafter of laws.
The direct analogy in the social security system is the chief adjudication officer and the adjudication officers, who over many years have determined all sorts of matters and have regularly been recognised to be independent, both during the time that the hon. Gentleman was a distinguished luminary of the Labour Government and today. It is rather unwise of him to cast doubt on the proposition in this fashion.
The Minister has not answered the point that I made. He should re-examine my words. He will find that it is all wheels within wheels. There is absolutely no independence in the appeals mechanism.
It is still left open as to whether an appellant has a right to an oral hearing and representation. Apparently, that matter is to be left to the Secretary of State's directions or the social fund commissioners' guidelines, without parliamentary accountability. In our view, such a basic right as that should be decided by Parliament through regulations.
Another major unresolved issue concerns entitlement as opposed to discretion. Our view is clear. A discretionary system is undesirable because it leads to variations, it increases the stigma of claiming, especially among the elderly, it is highly complex and it is not even necessarily more flexible. In particular, there are certain benefits for which there should be a clear entitlement to a grant and not a loan. One example relates to exceptionally severe weather payments—if the Minister does not wince at the idea. It is bad enough at present, when payments are made as a grant, that, in the first week of the freeze when the country shivered, they were paid to only a handful of people in one of the 64 weather station areas, and in the third week, when the weather became much milder, the Goverment panicked and paid them to everybody indiscriminately. What would happen if it were a loan? Would pensioners be forced to pay back the money?
The third unresolved issue concerns the social fund itself, which is the final safety net in the social security system that Ministers notoriously have insisted must be cash-limited. But they have also said — if it is not a paradox — that the fund will not run out. It is still not clear what will happen if the normal day-to-day requests for aid from the fund exceed the budget allocated. Will applicants, however manifest their need, simply be refused assistance or be told that they will get less assistance as the year passes and as the budget dwindles?
Will my hon. Friend try to interpret whether the decision of the Minister in respect of funeral and maternity grants means that such grants will have first call on the social fund? — [Interruption.] I fail to see what is so funny about this matter. If they have first call on the social fund, in effect it will mean that all other payments from the social fund could be reduced proportionately because of payments of funeral and maternity benefit that are decided in advance.
My hon. Friend has raised an interesting matter. It is for the Minister to reply to it, and I hope that he will do so. I agree with my hon. Friend. It appears that scarce funds could be pre-empted, which means that everyone else will go without.
The last matter concerns the vexed issue of loans as against grants. It seems that current DHSS thinking — the Minister referred to this but did not answer the point that I am about to make — is that only community care needs will be met by grants; all other needs will be met by loans. If that is so, the question that must be answered is, what exactly is meant by community care? It is a vague phrase and it may mean different things to different people.
In a recent speech the Minister said — for the first time, I believe — that loans would not be available to claimants until they had been in receipt of income support for six months. That opens up a new and ominous prospect. During the first six months on benefit, claimants are often adjusting to a much lower standard of living, although they are still carrying unalterable expenditure commitments. Already, home owners are suffering the loss of a quarter to a half of their income because of the iniquitous regulation that cuts mortgage interest payments for those on the dole. The latest proposal is a harsh extension of what is becoming the all too frequent practice of this Government of gratuitously kicking a family when it is down.
As for the level of these two proposed means-tested benefits, the current £30 level, to which the Minister referred, for the death grant has been repeatedly dismissed by Tory Members of Parliament and by the Minister today as so insignificant as to justify its transfer into a limited means-tested category. We repudiate those values and attitudes. If a universal grant in such a sensitive area is too low, we believe that the right approach is not to abolish it but to raise it to a reasonable level. That is why we have pledged to increase it from £30 to £200.
As for maternity grant replacement, the Government propose that the sum of £80 should be paid out of the social fund.
I understand my hon. Friend's point, but it is contradicted by the eloquent testimony of the Prime Minister, for which I have a great deal of sympathy: that if people pay for something on an insurance basis, they are entitled to it, irrespective of their total resources. However, I think that we should look at that point again.
As for the maternity grant, in 1983 the average single payment for maternity items was £60, in addition to the £25 grant. A grant now of £80, therefore, represents a cut in assistance for the average mother on supplementary benefit, even at 1983 prices, let alone at 1987 prices. I hope that the Government will reconsider this sum so that at least there will be no loss. I hope that they will also reconsider their very regrettable decision that mothers who are under 16 years of age should no longer be entitled to assistance with maternity expenses in their own right.
We reject the Bill. Unilaterally, it abolishes benefits to which people have a right, having earned their entitlement by contributions that they have made throughout their working lives. We reject it, too, because it is designed to consolidate a cash-limited social fund which, coming from this Government, is an insult on top of the injury of having allowed poverty to double in the first place.
This may be a minor measure but it has an ugly parentage in the Fowler Social Security Act of last year. For the sake of the people of this country, I pledge that we shall sweep away both this and its parent as soon as we come to power.
I am at something of a loss to know how to respond. The hon. Member for Oldham, West (Mr. Meacher) talks about a kick in the teeth for families in crisis, but I have always felt, ever since I took my first job working for the hon. Member for Birkenhead (Mr. Field), that the families who are constantly kicked in the teeth are those working on low incomes. It is precisely those who are not receiving supplementary benefit or income support who stand to benefit most from many of the changes in the Social Security Act 1986 and from the modifications that are being made to the death and maternity grants. It is to precisely those people that I want to refer.
The hon. Member for Oldham, West referred to the contributory principle. I was not sure whether he would develop this argument and say that in order to protect the contributory principle and to ensure that all those with maternity or funeral needs should be properly provided for he would extend maternity and death grants — at the rate of £80 for maternity grants and several hundred pounds for funeral grants — to all those who had contributed, in which case the £28 billion spending programme appears likely to cause older people much more anxiety than their present very real concern of sonic of them that they may be unable to meet their funeral costs.
The hon. Gentleman also referred to the Government's attitude to the welfare state in terms of knocking down an edifice. The welfare state has developed in recent years in such a way that now it is rather like a chaotic, higgledy-piggledy housing estate through which it is quite impossible to find one's way, with muggers around every corner. Coherent, clear planning, so that people know what benefits are available and how they can be obtained, is long overdue. In my view, that is precisely what the Social Security Act has sought to achieve.
The hon. Gentleman also read out a list of benefits that he suggested the Government are modifying. I should be interested to know whether he can recite the precise details, thresholds and amounts of each and every one of those series of benefits. I could not do so. I doubt whether even the respected hon. Member for Birkenhead could go through precisely all those benefits and describe how they work.
The complexity of the present system leads inevitably to unfairnesses and to the need for an army of welfare rights advisers to help people to discover how the single payments system works. It has led to enormous inequalities in different parts of the country, dependent on whether one is clever enough to work out these vast complexities by going through paragraphs of regulations and matching one's predicament to all those regulations.
The social fund is both a much more flexible and a much more simple response. Above all, it will be understood much more clearly by ordinary claimants, as opposed to welfare specialists. That is a laudable goal. At the same time, more help will be given to that long overlooked group of people, those who are on low incomes.
The new help that is to be provided for funeral expenses will be much more realistic. The £30 grant hardly covers the cost of two bouquets of flowers. Many people suffer great anxiety about how to finance a funeral under the existing arrangements. Ludicrous restrictions are placed on those payments concerning the relationship of the claimant to the deceased. Furthermore, if there is deemed to be money in the estate, even though it is inaccessible. claimants are not entitled to help. The death of a relative causes an emotional crisis for many people. It can also create a financial crisis until the financial position of the deceased finally emerges. These arrangements will ensure that more people will benefit and that those involved will be provided with a sensible and realistic benefit.
I was pleased that my hon. Friend the Minister referred to widows, on the basis of the case that was mentioned earlier. The fact that the widow's £1,000 will be entirely disregarded, let alone the value of any property that may have been left by the spouse, will make a substantial difference.
That was an important statement, but the truth is that most widows will not be helped because their pension will take them just above the level of entitlement. Their husbands would probably also have been above that level and therefore not eligible for help.
The awful fact is that, although we can say that the £1,000 will be disregarded, that sum will have to be used to pay the funeral bills.
The hon. Gentleman is also making the better point that, because many widows may just be above the supplementary benefit level and the rigid cut off, they have not stood to gain at all in the past. Now, however, because of the ability to help more people including those who are entitled to housing benefit or family credit, there will be a gain from a much fairer and a much more appropriate mechanism.
The hon. Member for Oldham, West referred to the Dignity in Death Alliance and its concerns. The hon. Gentleman belongs to a party that thinks it can buy off every interest group with a promise to meet all their needs, and solve every problem with an open cheque book, so long as it is not the Labour party's. I can appreciate his view. However, the elderly are most fearful of inflation running at 25 per cent. again, because they will be unable to predict what will happen.
The hon. Gentleman dared to raise the question of exceptional weather payments. I wondered what benefit the elderly had had from exceptional weather payments when the Labour party was in government. Exceptional weather payments have been introduced on a statutory basis only since this Government came to power.
The £25 maternity benefit has become irrelevant in terms of the total costs involved. It has been suggested that a pregnant woman on social security can claim a single payment. A paper has been circulated suggesting that the average single payment claim amounts to £60. To that is added the £25 maternity grant, which would mean that pregnant women will be worse off with the new grant of £80. That is entirely fallacious, because only a fraction of pregnant women on social security know, understand or claim the single payment. I ask the hon. Gentleman whether he will be able to give an estimate in his closing remarks. I understand that fewer than a quarter of pregnant women on social security claim the single payment. Again one sees a gross inequality in the distribution of the benefit.
If the hon. Lady is right in saying that only a fraction of women claim that amount, would it not be better if the Government advertised a take-up campaign? The point is that that amount is available for claiming.
I endorse efforts by anybody to promote awareness of benefits, but the hon. Lady will have seen the lists of single payments. It is difficult even for someone with two degrees to understand the system. How will somebody who has difficulty making ends meet and managing their family cope? The Government must ensure that realistic, reliable and proper payments can be claimed. When these benefits extend to those on income support or family credit and to other low income groups, they will ensure that greater help is given to the average mother in these categories.
I am sure that the hon. Lady will explain in the way that her party always does how, were her party ever to come to power, every benefit would be doubled or trebled. I have already suggested that her party believes that all problems can be solved with a cheque book: whatever anybody offers, offer more. I do not share that political philosophy. A responsible Government must look at the people who are genuinely in need, and target realistic and understandable help at those groups.
Much concern has been expressed about mothers under the age of 16. There were 1,390 such mothers in 1985. They are a worrying group who have a higher infant mortality rate and suffer greater health risks than other groups. It is not true that these mothers would receive no help under the present arrangements — they would simply be deemed to be their parents' children. If a 15-year-old mother of prosperous parents had a child, she would not be entitled to the £80, but if her parents were on family credit or income support she would be so entitled.
There are those who would seriously question whether a 15-year-old—or even a 16 or 17-year-old—should be deemed to be an autonomous individual in terms of social security regulations. That is not the situation in many other European countries, or in America.
Would the hon. Lady return to reality for a moment? Is she aware that, when a woman under 16 becomes pregnant and gives birth, it occasionally results in enormous family tension, and sometimes she is thrown out of the house? Under the Government's proposals, that woman and her baby would go without any assistance whatsoever, unless they could find a friend, relative or neighbour who was prepared to help them. Is that what the hon. Lady wants?
The hon. Gentleman seems unfamiliar with what happens in social services departments. Having been a social worker for many years, and a magistrate in a juvenile court, I can tell the hon. Gentleman that until the age of 17 years a child is the responsibility, if the parents are not responsible for her, of the social services department. Any pregnant 15-year-old who did not have the support of her parents would be a high priority for any social services department. If the hon. Gentleman has so little confidence in the social service department in his constituency, I am sorry for him. The Surrey social services department would make a high priority of any such case, and the 15-year-old would be given the fullest consideration. To regard her as an independent unit financially is misleading, because that might imply that she was an independent adult, which may not be in the longterm interests of her or her child.
Much was made of the social fund and appeals for the social fund. The Labour party seems to have lost all perspective of how social security payments are conducted. The social security budget has increased by 35 per cent. since 1979 half of that is attributed to the real increase in rates of benefits. The basic mechanism of our social security system is the benefit rate, not the single payment or special allowance. The Opposition want a system of endless single payments and special arrangements. That would lead to a greater sense of injustice and unfairness. The point of the social fund is to not let this ludicrous tail wag the dog.
In view of the way that single payments have escalated — more worryingly, the regional and patch variations in single payments claims — one cannot consider it a fair or just system. We should have a full and independent tribunal system for the basic benefit, which would remain untouched.
I welcome the fact that the Government felt able to show their ever-flexible approach by responding to concern about the social fund, thus enhancing the whole appeals mechanism. The question of appeals must be kept in perspective. In 1984 there were 3 million single payments. Some may think, looking at the total number of benefit claims, that that is a remarkable situation, given the time, human error and delay involved in each claim. Out of the 3 million single claimants there were 37,000 appeals. Of those 37,000 appeals, 8,000 cases were found in favour of the appellant. In other words, in only one quarter of one per cent. of cases was the single payment altered. In view of the time, expense and waste involved, one must look for some element of proportionality, and look to the main need of the social security system, which is reliable and secure with easily available benefits — benefits which are available not only for those on income support, but for those on family credit.
I appreciate the Government putting right this technical deficiency. I welcome the fact that the Government have remedied this fault in the social security system, within its complex, disorganised and inaccessible benefits. They corrected the defect in terms of allowing benefit to be available for those on low incomes, whether they are in or out of it. Above all, they had the courage to put right what has been wrong with maternity and death payments over many years.
I shall follow some of the points made by the hon. Member for Surrey, South-West (Mrs. Bottomley). In the earlier part of her speech, she gave an excellent analysis of the complexities and anomalies that seem to be inherent in the present social security system. As my right hon. and hon. Friends have said, the aim is to end the artificial distinction between national insurance and tax and to integrate tax and benefits further into a basic benefits system. That will go a long way towards redressing some of the injustices that occur, lessening complexities and increasing take-up of benefit. Sadly, despite the social security reviews, that is not the line that the Government have adopted.
This Social Fund (Maternity and Funeral Expenses) Bill might more fairly and accurately be subtitled the Tip of the Iceberg Bill. I suspect that over the next 18 months—and perhaps beyond, if the Conservative Government exist longer—there will be a stream of orders, legislation and correcting instruments as the injustices, complexities and anomalies of their system become apparent. The Minister stressed that the Bill deals with technical defects but that does not let the Government off the hook for the general shortcomings in the legislation. The very fact that the Government have had to introduce this measure underlines many of the deficiencies which have been pointed out by hon. Members on both sides of the House in different ways and at different times. The SDP/Liberal alliance has outlined in its reasoned amendment its objections to the Bill and why alliance Members will vote against it.
It is important to consider the effects of the Government's proposals in the context of previous benefit levels. Mothers who are in receipt of family income supplement or supplementary benefits are to receive grant of £80, which is low. At the moment at least mothers in the low income category can apply to the DHSS for single payments to help with some of the special costs associated with their children.
It is worth setting in context how much slippage has occurred. In 1983, the average single payment made by the DHSS was £60, making with the £25 maternity grant a total grant of £85. In cash and real terms the Government's proposals in the Bill will give mothers on supplementary benefit substantially less than they were receiving both in cash terms and real terms in 1983. That is wholly unjustified. [Interruption.] The Minister shakes his head. I hope that he will deal with that point.
The hon. Member for Surrey, South-West and, I believe, the Minister have pointed out that girls under 16 will not receive any help unless their parents are in receipt of supplementary benefit or family income supplement. Those girls are a particular at-risk group. The Minister has said, either in the House or elsewhere, that he would again look at that category. I hope that he will tell us more about his thinking along these lines.
The Government propose to cover the costs of "reasonable" funeral expenses. The Minister acknowledged that "reasonable" expenses will not be much less than £350 and in many areas could easily be £550. The hon. Member for Birkenhead (Mr. Field) correctly said in art intervention during the speech of the hon. Member for Oldham, West (Mr. Meacher) that it might be better to give a higher level of flat rate grant which could be claimed back out of the deceased person's estate. There are good reasons for doing that. First, it would target more help on those most in need and, secondly, in human terms, it would overcome much of the distress caused by bureaucratic and administrative machinery at a time of bereavement and, therefore, a time of pressure for family, relatives and loved ones. The Government are wrong in imposing an essentially means-tested benefit, with all its bad connotations, on those in an especially vulnerable position who are suffering from a particular and peculiar distress.
Many issues on the social fund remain outstanding. Some benefits are given at ministerial discretion. In some cases—for example, cold weather payments—one might want a discretionary entitlement. Whatever flat rate uniform system is adopted by any Government, it will never be able adequately to take account of the vagaries of the weather and people's different needs. There is a strong argument to be made in favour of providing for an element of local discretion in granting severe weather payments. If such discretion had been applied this year, it would have overcome many difficulties.
It is nonsense to cash-limit at social fund level and local level many of the entitlements that people will claim. Logically, cash-limiting flies in the face of what should be the open-ended discretion of a local officer. The Minister did not clarify to the satisfaction of the House exactly how cash-limiting and the mechanisms of the social fund will operate. He said that much will depend on continuing discussions on the level of benefits to be set. That is saying the obvious. Clearly, if benefits are generous, some of the difficulties which have been foreseen may not materialise. One can only go by the Government's record. Their record on maternity benefit, which has fallen in real terms since 1983, does not fill one with confidence about the position of claimants when the levels of various forms of benefit which are crucial to the future operation of the revised social security system are set. As the Minister has made clear, maternity and funeral expenses will remain as grants, and he has commented on the confusion that there has been about that. I accept that on other occasions I have been wrong about some of the details of the legislation. The hon. Member for Birkenhead said that he was wrong on one item, when he questioned the Minister. As the hon. Member for Birkenhead has made clear, in bringing forward the Bill, the Minister is admitting that he, too, has been wrong in the past, as have some of the civil servants who spend their careers working on the social security system. The commonsense implication of that is that if people who are paid to work on the social security system make mistakes, where on earth does that leave the claimant when the new social fund is introduced and the new method of calculating benefit levels is implemented? How on earth are the staff at local level and the claimants to understand it when those involved in the passage of this legislation—including some of us who gave evidence to the social security review—have difficulty with it? What hope has the claimant?
The hon. Gentleman has been very kind to the Government. If they had accepted amendments in Committee to put in the sum of the benefits, we should not have had to consider the Bill today.
I am grateful to the hon. Gentleman and entirely endorse what he has said.
We have watched the writhings of successive social security Ministers as they have fought their way through the legislation, and are beginning to see reality at the end of the tunnel in terms of the implications of this legislation. However, perhaps a wee bit more humility would have been a good thing. I have already described this as tip of the iceberg legislation, and we shall see this performance being repeated at the Dispatch Box for several months, and possibly years ahead.
A further implication of the social fund is that its allocation will be divided into two parts, covering grants and loans. Will the loans be topped up each year or will the Government expect it to be largely self-renewing as claimants repay the loans that they received in the past? The Government's position on that matter is not at all clear. We could reach the stage where a substanital proportion of claimants do not have the means to pay back the money. Given that the social security system is supposed to provide a safety net and that, therefore, somebody in the qualifying category is already at safety net level, how on earth can that person be expected to repay to some other source, in this case the Department of Health and Social Security, moneys which would then leave them below that safety net level? If that is the implication of the system, it reflects very badly on the Government's entire approach.
In conclusion—I shall be brief because of the time constraints—some of the issues that the hon. Member for Oldham, West pointed out were highlighted by the social security commission: for example, the generally unsatisfactory nature of so much that remains outstanding. In his opening speech the Minister discussed the much-needed reform of maternity benefit. It is worth bearing in mind that on 6 April the Maternity Alliance is holding an emergency rally in Westminster Hall. The Maternity Alliance points out:
In 1975 it seemed that we had the foundations of a realistic structure of benefits and rights which would give all mothers financial security around childbirth and the opportunity to continue to work without disadvantage. Now the very foundations are being undermined.
The Bill is simply a further confirmation of that rather sad conclusion, and we shall certainly vote against it.
I wish to intervene briefly in the debate to speak on behalf of a group of people who, it is proposed, will receive no benefit or help under the new regulations.
About two weeks ago a young couple from Westlea in Swindon came to my constituency surgery and told me of the death of their only child, at the age of 18 months. The cost of the funeral was £180 and they received £9 from the state, which is the benefit that is available to people in respect of the death of a child. Both of those people are working and, therefore, they would not come within the scope of the proposed system. However, the cost of the funeral will hit them extremely hard, at a time of very great tragedy. There can be no greater tragedy than the death of one's only and very young child.
Therefore, I should like to ask the Minister whether, since we are led to believe that the social fund will not be budgetarily restricted in respect of those grants, there is any possibility that such grants or loans could be advanced to those people for whom the need is clear, but the criteria are not met.
I should also like to comment on the "reasonableness" of funeral expenses. The regulations of 1986 that will govern the whole procedure are littered with the word "reasonable" in relation to funeral expenses. However, there is a risk of monopoly pricing coming into this matter, in relation to firms of undertakers, especially in small country towns. After all, it is unlikely that the bereaved will shop around for a competitive tender for a funeral. Therefore, it is reasonable to ask the Government to define what they mean by the word "reasonable" in terms of the pricing and the various aspects of a funeral for which an undertaker is responsible. At the same time, the Government should bear in mind that the maximum will easily become the minimum, as far as charging and pricing are concerned. I hope that my hon. Friend the Minister will have a moment to refer to those two points.
In conclusion, the hon. Member for Oldham, West (Mr. Meacher), who is unfortunately no longer in the Chamber, does not accept the maxim that resources should be directed to where they are most needed. When listening to him, one clearly understands that he is in some kind of crazy auction, in which the price or charge that is mentioned will be doubled and trebled to try to win the auction, which is electoral practice. The hon. Gentleman prefers to spend without regard to what the nation can afford and those who have heard him tonight talk about £200 for the death grant can reasonably expect it to be £400 before the next election, and, no doubt, £600 before the one after that, and to go on increasing, not in line with inflation, but with his own despairing hopes of being elected as the Minister responsible for those matters.
I suspect that the shadow of his right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) is not far away because there has been no bidding-up this evening, but it will come. The consequence of that will be rapid inflation and rising unemployment which will hit hard at those people we are trying to protect today.
I should like to say briefly that the Bill is perhaps a start of many more Bills of this type. In Committee on the Social Security Act 1986, Labour Members consistently pointed out the dangers and the ineffectiveness of the social fund in meeting social problems, and the fact that, because the fund was cash-limited, at the end of the day somebody would lose. I get the feeling that the Government are making a pre-emptive strike by saying, "Yes, we shall fix the amount of the payments for maternity and funeral grants; they will be the first call on the social fund." We need an undertaking from the Minister that the social fund will not be reduced accordingly and that other benefits will not be paid. If that is to be the case, people who are not in receipt of funeral or maternity benefits, but eligible for other benefits or loans will not be eligible for them. Therefore, the problem will he exacerbated for those groups. We require an answer to that question from the Minister.
My second point relates to the maternity grant. It is simply not good enough in 1987 to discuss taking away the right to the maternity grant from mothers with newborn children and to give it instead, in effect, by means-testing, to a limited number of people. In addition, that benefit will be the lowest anywhere in Europe for newborn babies. The social difference between children born in high rise flats in constituencies such as mine to poor parents who are unemployed and likely to he unemployed for a long time and those born in the leafy suburbs will become greater. We are moving towards the meanest form of welfare state that could ever be dreamt of and the ghettoisation of the poor by denying them opportunities from birth.
Hon. Members have spoken about how mothers under the age of 16 will be dealt with under this legislation. The hon. Member for Surrey, South-West (Mrs. Bottomley) misunderstood my point lamentably: I have complete confidence in the social services department in my constituency. It does a good job and meets enormous difficulties. I wish that the hon. Lady would not support a Government who insist on cuts being made in the social services available for my constituents. Her remarks would make more sense if she were prepared to be honest about that.
The Government should consider direct payment to mothers under the age of 16. The problem will not be solved merely by wishing away or by forcing a young woman into social services care. I do not see why young mothers cannot receive that help instead of being persuaded—that is what social services departments will do—to rely on their parents for support. That is an unsatisfactory way of dealing with a small but serious problem for the 1,390 people who were affected by this last year.
When the funeral grant was introduced in 1948 it was a reasonable proportion of the cost of a funeral at that time. It has not been increased anything like in line with inflation or, indeed, with the exorbitant costs that undertakers charge for funerals. There are ways of getting round that problem, such as through municipal funeral undertakers which I would recommend and support strongly. But we must understand the genuine anxiety of elderly people that they cannot be buried with decency. That is a serious problem and prays on the minds of many elderly people.
The Minister tells us that the number of people who will be covered by these arrangements will increase from 4·5 million to 8 million. Are those 8 million predominantly pensioners or people in receipt of housing benefit? Is housing benefit the bench mark for that decision? If they are in receipt of housing benefit, they are more likely to be young people who, fortunately, are not likely to die in the near future. In that case the Minister has grossly exaggerated the number of people who will benefit from his scheme as a whole.
The Social Security Act 1986 was one of the most aggressive pieces of legislation in the past seven years. It has helped to destroy the foundations of the welfare state, which was envisaged to provide decency and security through birth, life and death for all people, irrespective of their ability to pay. Now we see means testing writ large throughout the welfare state.
The Bill is just the start of a series of measures which will be introduced to placate the genuine, united opposition to the Social Security Act, but that will continue during and after the general election, when I hope that we will remove that particularly odious legislation.
I am grateful for this brief moment to speak in the debate. I am lamentably ignorant about this subject and I take part because I wish to raise an important matter of constituency interest on behalf of a constituent.
I do not understand how the Labour party can treat the legislation with such seeming contempt when it is absolutely right that we should aim to target these benefits on those who need them most. It is critical that we should give to those in need and help the helpless. We should give them real assistance rather than adopt the scatter-gun approach and give many people a little.
I wish to deal with the maternity grant in particular. It is an important part of our family legislation. I agree with Opposition Members that it has been at a lamentable level for some time. I greatly welcome its increase to £80. The family is an institution which is absolutely critical and essential to our social and moral well-being. The Government, to give them their due, have tried to promote the interests of the family, but a baby involves considerable extra expense. It is proposed that the maternity grant should be raised from £25 to £80 and should be for those on supplementary benefit or on family income supplement. That is an excellent aim, as it will help people on low incomes who have exceptional expenses in a more flexible way. It is about those exceptional expenses that I should like to speak.
I understand that no extra money is payable to handicapped and disabled children until they reach the age of two. As my hon. Friend the Minister knows from our correspondence, I have in my constituency a lady called Mrs. Manning who has a seriously handicapped child of six months. Every Monday she must take the child to a hospital outside our local health authority to receive specialised treatment. The round journey covers 42 miles. Five times a day the child must have specialised therapy from Mrs. Manning. It takes over an hour on each occasion to feed the child because it is unable to suck properly. No attendance allowance is available until the child reaches the age of two, and Mrs. Manning cannot rely indefinitely on the goodwill of her neighbours to look after her other child while she takes the baby to hospital.
I understand that the Department must make a medical judgment on these matters and I completely accept what my hon. Friend said in his letter to me that the child's needs must be substantially in excess of those normally required by a child of the same age and sex. Given any normal criteria, there must be no shadow of doubt that this child is grievously handicapped and at a serious disadvantage, and that the mother is in considerable distress and finds it difficult to provide for her child.
Would it not be possible, given the flexibility that these measures undoubtedly accord in terms of payment, to consider a special type of payment— I know that my hon. Friend is trying to get away from that in some areas— which could cover children who are defined as seriously handicapped, just as they are now defined as not being sufficiently handicapped to warrant additional help?
I have considerable sympathy with the case of Mrs. Manning that the hon. Member for Crawley (Mr. Soames) has just raised. Some years ago I had a parallel case and I remember how heart wrenching it was to see the family struggling to care for their child and to cope with the expense. The hon. Gentleman's opening remarks were a little odd, because he said the opposite of what I intend to say. He congratulated the Government on being the party of the family; I say that, if the Government think that they are the party of the family, that is the biggest con that I have ever heard.
Families are essentially about mothers and children who are the most vulnerable people. For mothers pregnancy and preparing to have a child is an expensive business. At some stage it means giving up one's job, rejigging one's life and looking ahead to the needs of the unborn child. Many Conservative Members are fierce defenders of the rights of the unborn child in another context when they oppose the legitimate right of a woman to terminate a pregnancy. However, they are less than supportive of the needs of the unborn child, the pregnant woman, the new baby and its mother when it comes to handing out cash support to ensure that that child has a decent start in life.
We have heard much tonight on both sides of the House, but especially from the hon. Member for Surrey, South-West (Mrs. Bottomley), about the plight of the under-16-year-olds. We must remember and emphasise that the Social Security Act 1986 has virtually written off under-16-year-olds altogether. It is all very well to say that the Social Security Act regards under-16-year-olds as the property or responsibility of their parents. I take issue with the hon. Member for Surrey, South-West, who implied that under-16-year-olds, whom I would call young women, are not people to whom an independent allowance could be given should they become pregnant.
I am an absolutely devoted fan of EastEnders. Whatever happens, I will not miss an episode. Michelle is the under-16-year-old girl in the series who became pregnant and who has now had the baby and is working to pay off the debts which her unemployed father accumulated to try to help her out. That shows that people of that age are responsible and can take responsibility. If they can take responsibility, they are entitled to maternity grant instead of being denied it as they are at present.
Many hon. Members have said that the present proposals for the £80 grant is less than what, on average, a woman can claim now, when there is a £25 universal grant as of right. I agree with that and campaigned even under a Labour Government for the grant to be increased, but together with the £60-worth of other supplementary benefits.
It is no good saying that not everyone receives the £60-worth of benefits. Some receive it and others should, as the hon. Member for Surrey, South-West acknowledged. Why make the benefits worth £80? Why not make them worth £100 or £125? In its last manifesto, the Labour party proposed £125. That would at least mean that people would not receive less benefits. However, we are also transferring the payment of maternity allowance to employers and restricting payment to women who are in work and who are paying national insurance contributions up to the point at which they can claim. Even more seriously, we are abolishing the right of pregnant women and their babies to free milk and vitamins. That is absolutely terrible. At least poor families used to have the right to free milk and free vitamins. Now, we have virtually said that that right should go.
In recent years there have been two well publicised estimates of the cost of a new-born baby. One was in the Daily Mirror in 1984 which stated that the cost of caring for a new baby was about £447. The other was in the magazine Parents in 1985 which estimated that £702 was the cost of baby clothes and equipment.
We lag badly behind some other European countries. We hear from Conservative Members how generous the Government are being, but in Belgium the grant for the first child is £395, for the second it is £272 and for the third it is £146. In Denmark, the allowance runs to a maximum of £155 a week. Imagine it! The allowance is financed out of general taxation. In France, the allowance is £70·22 a month. Those benefits are all much more generous than those given in Britain.
I am wearing a badge which was given to me by the Maternity Alliance which, as the hon. Member for Ross, Cromarty and Skye (Mr. Kennedy) said, will be holding a rally in Central Hall on 6 April. The badge says:
It is better to have a baby in Finland.
Why Finland? The answer is that in Finland every pregnant woman, as of right, gets a baby basket with all the clothes that she and the new-born baby will need. The baby basket converts into a carry-cot. That is a present given by the Government of Finland to pregnant women. All that happens in Britain— I am informed by my secretary who has just had a baby—is that a pregnant woman is given one disposable nappy the first time that she goes to the hospital. How mean can we get? We should deal much more generously with pregnant women and babies because they are so important to us.
The maternity emergency campaign will attract an awful lot of support from pregnant women and women who have been pregnant or who may become pregnant. I am told by the Greenwich branch of the maternity emergency campaign that there are now more than 71,000 women in that borough under 50 years old, some of whom will be affected by this Bill. Some 4,800 of them are unemployed and of childbearing age.
This is a miserable little Bill. We shall oppose it with all the might that we can muster, and we shall do our best, when the remaining stages are taken, to amend it. In the meantime, I ask my right hon. and hon. Friends to oppose it.
This debate has rightly concentrated not on the technical error in the regulation-making powers but on the policy which was known and clearly stated as long ago as the publication of the White Paper and widely debated during the passage of the main Bill. We have concentrated on particular aspects of that policy and I shall answer the points that have been raised.
The hon. Member for Barking (Ms. Richardson) commended Finland because it hands out a basket with baby clothes. Most people would wish to choose and buy their own baby clothes. However, comparison with Europe is misleading. Five European countries make no maternity grant whatsoever. Furthermore, it is misleading to add the £25 of the present grant to the £60 which a small minority of those on supplementary benefit receive from single payments as only between one quarter and one fifth of new mothers receive that £60. Therefore, it is not a fair comparison.
I have a few minutes to answer the points made in the debate. I am surprised that the hon. Member for Oldham, West (Mr. Meacher) should be so conservative as to hark hack to, and thoroughly misunderstand, the national insurance contributions principle. The principle, as he should appreciate, is not the same as a private insurance system. It is a pay-as-you-go system and it raises £21·5 billion worth of contributions to pay £24 billion worth of benefits. He told the House yet again that if Labour came to power there would be more taxes and more national insurance contributions for less well-targeted benefits.
My answer to the point made by the hon. Member for Islington, North (Mr. Corbyn) on whether the social fund budget would run out is that it will not. Funeral and maternity payments will not be constrained by the budgets. They are entitlements to those who are within the passported groups that we have been discussing. The money to he given to them will not eat into the funds. I do not have time to explain that more fully, but I wish to make it clear that there will be a standing balance.
If the family in the tragic circumstances that my hon. Friend the Member for Swindon (Mr. Coombs) outlined is a low-income family in work, it is capable of falling within the passported groups for the first time. We are widening eligibility from people on supplementary benefit to include people on family income supplement, family credit—I do not know whether the family that my hon. Friend mentioned falls into that category—and housing benefit.
It must be recognised that maternity and funeral payments are, in the present system, long out of date. That problem is being tackled and money is being targeted on people in real need. I commend the Bill to the House.
|Division No. 82||7 pm|
|Adley, Robert||Arnold, Tom|
|Alexander, Richard||Aspinwall, Jack|
|Amess, David||Atkinson, David (B'm'th E)|
|Ancram, Michael||Baker, Nicholas (Dorset N)|
|Baldry, Tony||Hanley, Jeremy|
|Banks, Robert (Harrogate)||Haselhurst, Alan|
|Batiste, Spencer||Hayes, J.|
|Bendall, Vivian||Hayhoe, Rt Hon Sir Barney|
|Benyon, William||Henderson, Barry|
|Bevan, David Gilroy||Higgins, Rt Hon Terence L.|
|Biggs-Davison, Sir John||Hill, James|
|Blackburn, John||Hogg, Hon Douglas (Gr'th'm)|
|Blaker, Rt Hon Sir Peter||Holland, Sir Philip (Gedling)|
|Body, Sir Richard||Howarth, Gerald (Cannock)|
|Bonsor, Sir Nicholas||Howell, Rt Hon D. (G'ldford)|
|Boscawen, Hon Robert||Irving, Charles|
|Bottomley, Mrs Virginia||Jackson, Robert|
|Bowden, A. (Brighton K'to'n)||Jessel, Toby|
|Bowden, Gerald (Dulwich)||Johnson Smith, Sir Geoffrey|
|Boyson, Dr Rhodes||Kershaw, Sir Anthony|
|Bright, Graham||Key, Robert|
|Brinton, Tim||King, Rt Hon Tom|
|Brittan, Rt Hon Leon||Knowles, Michael|
|Brooke, Hon Peter||Lamont, Rt Hon Norman|
|Brown, M. (Brigg & Cl'thpes)||Lang, Ian|
|Browne, John||Latham, Michael|
|Bruinvels, Peter||Lawler, Geoffrey|
|Bryan, Sir Paul||Lawrence, Ivan|
|Buck, Sir Antony||Lee, John (Pendle)|
|Budgen, Nick||Lester, Jim|
|Bulmer, Esmond||Lewis, Sir Kenneth (Stamf'd)|
|Butterfill, John||Lightbown, David|
|Carlisle, Kenneth (Lincoln)||Lilley, Peter|
|Carlisle, Rt Hon M. (W'ton S)||Lloyd, Sir Ian (Havant)|
|Carttiss, Michael||Lloyd, Peter (Fareham)|
|Cash, William||Lord, Michael|
|Chalker, Mrs Lynda||Luce, Rt Hon Richard|
|Channon, Rt Hon Paul||Lyell, Nicholas|
|Chapman, Sydney||McCurley, Mrs Anna|
|Chope, Christopher||Macfarlane, Neil|
|Churchill, W. S.||MacGregor, Rt Hon John|
|Clark, Hon A. (Plym'th S'n)||MacKay, Andrew (Berkshire)|
|Clark, Dr Michael (Rochford)||MacKay, John (Argyll & Bute)|
|Clark, Sir W. (Croydon S)||Maclean, David John|
|Clarke, Rt Hon K. (Rushcliffe)||McLoughlin, Patrick|
|Clegg, Sir Walter||McNair-Wilson, M. (N'bury)|
|Cockeram, Eric||McNair-Wilson, P. (New F'st)|
|Coombs, Simon||McQuarrie, Albert|
|Cope, John||Madel, David|
|Corrie, John||Major, John|
|Couchman, James||Malins, Humfrey|
|Cranborne, Viscount||Malone, Gerald|
|Crouch, David||Maples, John|
|Currie, Mrs Edwina||Marland, Paul|
|Dickens, Geoffrey||Marlow, Antony|
|Dicks, Terry||Marshall, Michael (Arundel)|
|Dover, Den||Mates, Michael|
|du Cann, Rt Hon Sir Edward||Mather, Sir Carol|
|Dykes, Hugh||Mawhinney, Dr Brian|
|Edwards, Rt Hon N. (P'broke)||Maxwell-Hyslop, Robin|
|Evennett, David||Mellor, David|
|Eyre, Sir Reginald||Merchant, Piers|
|Fairbairn, Nicholas||Meyer, Sir Anthony|
|Farr, Sir John||Miller, Hal (B'grove)|
|Favell, Anthony||Mills, Sir Peter (West Devon)|
|Fenner, Dame Peggy||Miscampbell, Norman|
|Finsberg, Sir Geoffrey||Mitchell, David (Hants NW)|
|Fletcher, Sir Alexander||Montgomery, Sir Fergus|
|Fookes, Miss Janet||Morris, M. (N'hampton S)|
|Forman, Nigel||Morrison, Hon C. (Devizes)|
|Forsyth, Michael (Stirling)||Morrison, Hon P. (Chester)|
|Fowler, Rt Hon Norman||Mudd, David|
|Fraser, Peter (Angus East)||Murphy, Christopher|
|Gale, Roger||Neale, Gerrard|
|Garel-Jones, Tristan||Nelson, Anthony|
|Gilmour, Rt Hon Sir Ian||Neubert, Michael|
|Glyn, Dr Alan||Newton, Tony|
|Goodhart, Sir Philip||Nicholls, Patrick|
|Grant, Sir Anthony||Norris, Steven|
|Greenway, Harry||Onslow, Cranley|
|Griffiths, Sir Eldon||Oppenheim, Phillip|
|Grylls, Michael||Oppenheim, Rt Hon Mrs S.|
|Hamilton, Hon A. (Epsom)||Osborn, Sir John|
|Hamilton, Neil (Tatton)||Ottaway, Richard|
|Page, Sir John (Harrow W)||Stevens, Lewis (Nuneaton)|
|Page, Richard (Herts SW)||Stewart, Andrew (Sherwood)|
|Patten, J. (Oxf W & Abgdn)||Stewart, Ian (Hertf'dshire N)|
|Pawsey, James||Stokes, John|
|Peacock, Mrs Elizabeth||Stradling Thomas, Sir John|
|Percival, Rt Hon Sir Ian||Sumberg, David|
|Pollock, Alexander||Tapsell, Sir Peter|
|Portillo, Michael||Taylor, John (Solihull)|
|Powell, William (Corby)||Taylor, Teddy (S'end E)|
|Powley, John||Temple-Morris, Peter|
|Prentice, Rt Hon Reg||Terlezki, Stefan|
|Price, Sir David||Thomas, Rt Hon Peter|
|Proctor, K. Harvey||Thompson, Donald (Calder V)|
|Raffan, Keith||Thompson, Patrick (N'ich N)|
|Rathbone, Tim||Thornton, Malcolm|
|Rees, Rt Hon Peter (Dover)||Thurnham, Peter|
|Rhodes James, Robert||Townend, John (Bridlington)|
|Rhys Williams, Sir Brandon||Tracey, Richard|
|Ridley, Rt Hon Nicholas||Trippier, David|
|Ridsdale, Sir Julian||Trotter, Neville|
|Rifkind, Rt Hon Malcolm||Twinn, Dr Ian|
|Roberts, Wyn (Conwy)||van Straubenzee, Sir W.|
|Robinson, Mark (N'port W)||Vaughan, Sir Gerard|
|Roe, Mrs Marion||Viggers, Peter|
|Rossi, Sir Hugh||Waddington, Rt Hon David|
|Rowe, Andrew||Walden, George|
|Rumbold, Mrs Angela||Walker, Bill (T'side N)|
|Ryder, Richard||Wall, Sir Patrick|
|Sackville, Hon Thomas||Waller, Gary|
|Sainsbury, Hon Timothy||Walters, Dennis|
|Sayeed, Jonathan||Ward, John|
|Scott, Nicholas||Wardle, C. (Bexhill)|
|Shaw, Giles (Pudsey)||Warren, Kenneth|
|Shaw, Sir Michael (Scarb')||Watson, John|
|Shelton, William (Streatham)||Watts, John|
|Shersby, Michael||Wells, Sir John (Maidstone)|
|Silvester, Fred||Wheeler, John|
|Sims, Roger||Wiggin, Jerry|
|Skeet, Sir Trevor||Wilkinson, John|
|Smith, Tim (Beaconsfield)||Winterton, Mrs Ann|
|Soames, Hon Nicholas||Winterton, Nicholas|
|Speed, Keith||Wolfson, Mark|
|Speller, Tony||Woodcock, Michael|
|Spencer, Derek||Yeo, Tim|
|Spicer, Jim (Dorset W)||Young, Sir George (Acton)|
|Spicer, Michael (S Worcs)||Younger, Rt Hon George|
|Stanbrook, Ivor||Tellers for the Ayes:|
|Stanley, Rt Hon John||Mr. Tony Durant and|
|Steen, Anthony||Mr. Francis Maude.|
|Abse, Leo||Brown, Ron (E'burgh, Leith)|
|Adams, Allen (Paisley N)||Bruce, Malcolm|
|Alton, David||Buchan, Norman|
|Anderson, Donald||Caborn, Richard|
|Archer, Rt Hon Peter||Callaghan, Rt Hon J.|
|Ashley, Rt Hon Jack||Callaghan, Jim (Heyw'd & M)|
|Ashton, Joe||Campbell, Ian|
|Atkinson, N. (Tottenham)||Canavan, Dennis|
|Bagier, Gordon A. T.||Carlile, Alexander (Montg'y)|
|Banks, Tony (Newham NW)||Clark, Dr David (S Shields)|
|Bell, Stuart||Clarke, Thomas|
|Benn, Rt Hon Tony||Clay, Robert|
|Bennett, A. (Dent'n & Red'sh)||Clelland, David Gordon|
|Bermingham, Gerald||Clwyd, Mrs Ann|
|Bidwell, Sydney||Cocks, Rt Hon M. (Bristol S)|
|Blair, Anthony||Cohen, Harry|
|Boothroyd, Miss Betty||Coleman, Donald|
|Boyes, Roland||Conlan, Bernard|
|Bray, Dr Jeremy||Cook, Frank (Stockton North)|
|Brown, N. (N'c'tle-u-Tyne E)||Corbett, Robin|
|Brown, R. (N'c'tle-u-Tyne N)||Corbyn, Jeremy|
|Cox, Thomas (Tooting)||Marek, Dr John|
|Craigen, J. M.||Marshall, David (Shettleston)|
|Crowther, Stan||Martin, Michael|
|Cunliffe, Lawrence||Mason, Rt Hon Roy|
|Dalyell, Tarn||Maxton, John|
|Davies, Rt Hon Denzil (L'lli)||Maynard, Miss Joan|
|Davies, Ronald (Caerphilly)||Meacher, Michael|
|Davis, Terry (B'ham, H'ge H'l)||Meadowcroft, Michael|
|Deakins, Eric||Michie, William|
|Dixon, Donald||Millan, Rt Hon Bruce|
|Dormand, Jack||Mitchell, Austin (G't Grimsby)|
|Douglas, Dick||Morris, Rt Hon A. (W'shawe)|
|Dubs, Alfred||Morris, Rt Hon J. (Aberavon)|
|Duffy, A. E. P.||Nellist, David|
|Eastham, Ken||Oakes, Rt Hon Gordon|
|Evans, John (St. Helens N)||O'Brien, William|
|Fatchett, Derek||O'Neill, Martin|
|Field, Frank (Birkenhead)||Orme, Rt Hon Stanley|
|Fields, T. (L'pool Broad Gn)||Park, George|
|Fisher, Mark||Parry, Robert|
|Flannery, Martin||Patchett, Terry|
|Foot, Rt Hon Michael||Pavitt, Laurie|
|Forrester, John||Pendry, Tom|
|Foster, Derek||Pike, Peter|
|Fraser, J. (Norwood)||Powell, Raymond (Ogmore)|
|Freeson, Rt Hon Reginald||Prescott, John|
|George, Bruce||Radice, Giles|
|Gilbert, Rt Hon Dr John||Randall, Stuart|
|Godman, Dr Norman||Raynsford, Nick|
|Golding, Mrs Llin||Redmond, Martin|
|Hamilton, W. W. (Fife Central)||Rees, Rt Hon M. (Leeds S)|
|Hardy, Peter||Richardson, Ms Jo|
|Harrison, Rt Hon Walter||Roberts, Ernest (Hackney N)|
|Hart, Rt Hon Dame Judith||Robinson, G. (Coventry NW)|
|Healey, Rt Hon Denis||Rooker, J. W.|
|Heffer, Eric S.||Ross, Ernest (Dundee W)|
|Hogg, N. (C'nauld & Kilsyth)||Ross, Stephen (Isle of Wight)|
|Holland, Stuart (Vauxhall)||Sheldon, Rt Hon R.|
|Home Robertson, John||Shore, Rt Hon Peter|
|Howarth, George (Knowsley, N)||Short, Ms Clare (Ladywood)|
|Howell, Rt Hon D. (S'heath)||Short, Mrs R.(W'hampt'n NE)|
|Howells, Geraint||Silkin, Rt Hon J.|
|Hoyle, Douglas||Skinner, Dennis|
|Hughes, Robert (Aberdeen N)||Smith, C.(lsl'ton S & F'bury)|
|Hughes, Roy (Newport East)||Soley, Clive|
|Hughes, Sean (Knowsley S)||Spearing, Nigel|
|Hughes, Simon (Southwark)||Steel, Rt Hon David|
|Hume, John||Stott, Roger|
|Jenkins, Rt Hon Roy (Hillh'd)||Straw, Jack|
|John, Brynmor||Thomas, Dafydd (Merioneth)|
|Kennedy, Charles||Thompson, J. (Wansbeck)|
|Kirkwood, Archy||Tinn, James|
|Lamond, James||Wallace, James|
|Leadbitter, Ted||Wardell, Gareth (Gower)|
|Leighton, Ronald||Wareing, Robert|
|Litherland, Robert||Weetch, Ken|
|Lloyd, Tony (Stretford)||Welsh, Michael|
|Lofthouse, Geoffrey||White, James|
|Loyden, Edward||Wigley, Dafydd|
|McCartney, Hugh||Williams, Rt Hon A.|
|McDonald, Dr Oonagh||Winnick, David|
|McKay, Allen (Penistone)|
|MacKenzie, Rt Hon Gregor||Tellers for the Noes:|
|Maclennan, Robert||Mr. Frank Haynes and|
|McNamara, Kevin||Mr. John McWilliam.|