Clause 2 - Guarantee Credit

State Pension Credit Bill [Lords] – in a Public Bill Committee at 6:45 pm on 16th April 2002.

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Photo of Peter Atkinson Peter Atkinson Conservative, Hexham

With this it will be convenient to discuss amendment No. 3, in page 2, line 26, at end insert—

'(6A) Such regulations may not apply to hospital in-patients.'.

Photo of Tim Boswell Tim Boswell Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson (Work and Pensions)

I sense that we have had a useful afternoon, but that we may now want to make more progress. We shall see how far we get in the time left.

When I examined clause 2, I was concerned that it was unamended. A maxim of an Opposition spokesperson in Committee—certainly one that I have followed in the past—is that if a clause is unamended, find something to ask about it and table an amendment to probe it.

I hope that my amendment goes further, and addresses a point of substance. The Under-Secretary almost revealed in the exchanges on the previous clause that the minimum income guarantee, which transmutes into guarantee credit, is substantially the same concept as the income support that it replaced. The level at which assistance is given, and the disincentives, if any, that exist to save are important matters, but we certainly do not want to rehearse them now.

I may wish later to ask the Minister some general questions about the operation of the guarantee credit, which arise more properly under clause stand part. Rather than trying to ask them now, I shall restrict myself to our amendment and that of the hon. Member for Northavon.

Amendment No. 14 has two purposes. The first is to smoke out from the explanatory notes whether prescribed amounts should be confined to hospital downrating. It would be useful to have the Under-Secretary's assurance that it is. If she is contemplating introducing prescribed amounts in other areas, where an arbitrary level would be substituted for the standard minimum guarantee, it will be useful to know that.

The second purpose of our amendment, which is the one of substance given that hospital downrating has been trailed, is to ask the Under-Secretary to comment on the thinking behind what has been done. The Committee heaved a collective sigh of relief, which I hope included the Ministers, when they were led, encouraged or dragooned by a combination of forces in another place to relax the hospital downrating rules from six to 13 weeks. That substantial hole has been kicked into the concept of the downrating rules and Ministers should say a little more about what is left and why. If a substantial chunk is removed—half the cost or value of the scheme by any analysis—we must ask what is left and whether it is appropriate.

I fully understand, and Ministers will know better than anyone else in the Committee, that there is a revenue implication. They cannot go around making concessions according to the state of the sun or the moon, but must consider their overall budgets. I shall not press them hard on the principle, but it would be useful to know a little more about their thinking on that.

The relict scheme, which reflects the wish from the start of the national insurance scheme in 1948 not to allow for double provision, is an anomaly. I am sure that that came into debates in another place. I do not want to suggest that an untypical case is typical, but it would be possible for a pensioner in receipt of the guarantee credit suddenly to receive a windfall or to return to work unexpectedly with a large increase in their income. They would retain their entitlement to the guarantee or any savings credit that may arise, and good luck to them. I am not arguing about that. However, I understand that, if people are confined in hospital and receiving support from the public purse for their board and lodging perhaps, that is the only exceptional circumstance in which the guarantee credit would be written down with substitution of a prescribed amount. Those people would be in an unusual and unique position. The Ministers should explain that—that is the purpose of my amendment—and justify whether we have now reached an equitable and acceptable position.

It is easy to say—perhaps it should be said from the Opposition Benches—that people confined in hospital have problems. They have health problems and the Ministers acknowledged in making their concessions the continuing obligation to expenditure outwith hospital. It is not simply a matter of keeping people

alive by providing food and shelter. A 13-week period is more acceptable than a six-week period, but it would help if the Ministers explained how they reached that position and whether that is the only prescribed exception that they are minded to make.

Debate adjourned.—[Angela Smith.]

Adjourned accordingly at five minutes to Seven o'clock till Thursday 18 April at half-past Nine o'clock.