I beg to move amendment No. 26, in page 4, line 4, leave out 'except in prescribed circumstances'.

We now come to the question of aggregating the income and capital of couples for the purpose of determining entitlement to the pension credit. Generally speaking, joint assessment of couples and the way in which that compares with the principle of separate assessment under taxation has been one of the features of tax credits commented on in many quarters. That principle of joint assessment applies equally to other forms of tax credit: the working tax credit, and now the child tax credit. As many people have said, that cuts across the principle of independent taxation. However, it is in the Bill and we must consider it.

Under clause 5, any income or capital of the claimant's partner, whether they are married or not, is treated as the income or capital of the claimant for the purposes of the pension credit income assessment. The only exceptions to that rule are circumstances that are to be prescribed in regulations. The amendment is probing, and will explore what such circumstances might be, if the Minister can throw any light on that. We note that the explanatory notes cite two examples of circumstances where joint assessment would not take place that may be prescribed in regulations. The examples are:

''where a partner receives income from a trust, or capital is held in trust, for a third party who is not part of the income assessment unit; or similarly, where the partner is the appointee or holds power of attorney for the financial affairs of a third party who, again, is not part of the assessment unit.''

In such circumstances, it seems intuitively right that income or capital should not fall into the assessment for pension credit purposes. Indeed, it seems inconceivable that it should do so. The person concerned—the claimant or the partner—is not receiving any benefit from that, and is acting under a duty when dealing with it. The examples seem to imply that where the person concerned is under a duty to deal with income or capital for the benefit of a third party, and receives no benefit himself, that will not be taken into account. However, the underlying principles are not exactly spelt out, and it would be useful to hear something from the Minister on that.

It seems to me, and my hon. Friend will know this from his legal experience, that where examples are cited in legislation—I appreciate that the explanatory notes do not have the force of legislation—there is a danger

that the cases cited may be seen as an exclusive list. I hope that it is the intention of Ministers to make it an inclusive list for other circumstances that they may specify this morning, or which may arise in light of subsequent experience.

What my hon. Friend says is helpful and lends strength to my contention that there is a need for the principles to be spelt out. It is all very well having examples, but we need to find out what other circumstances might be covered. It is more helpful to have the principles spelt out than to be given examples only. We are leaving those to be prescribed by regulations but, examining the final provisions of the Bill concerning regulation-making powers, I notice that the regulations made under the clause do not seem to be subject to the affirmative procedure, so we shall be left with the negative procedure for them. Against that background, it would help if the Minister could tell us something about that this morning so that we may debate it as fully as possible. We need to explore it.

I apologise to the Committee because the Under-Secretary, my hon. Friend the Member for Liverpool, Garston (Maria Eagle), is participating in a Westminster Hall debate this morning. I think that the hon. Member for Daventry (Mr. Boswell) will also be there later, so this Committee will be without intellectual input this morning. We shall have to muddle on until my hon. Friend and the hon. Gentleman return later. I do not know whether the hon. Member for Northavon (Mr. Webb) is also going to that debate.

Clause 5 replicates the provision in section 136 of the Social Security Contributions and Benefits Act 1992. It is desirable for consistency reasons for the provision to be carried through to clause 5, but I would not expect hon. Members simply to accept that in Committee, sit down and say, ''There you are—it's for consistency''. The amendment, if it were accepted, would remove a flexibility to make beneficial changes without the time-consuming process of amending primary legislation. I do not think that that is reasonable.

I shall say a few words about the debate that occurred in another place on the treatment of couples, to put the amendment in context, as the hon. Member for Hertsmere (Mr. Clappison) requested. Much interest was shown in the other place in the composition of family units and how the pension credit should treat single people, married and unmarried couples and those in polygamous marriages. Couples are treated differently for contributory benefits such as the retirement pension where entitlement is based on lawful marriage. That stems from the national insurance scheme in which, usually, the husband was the contributor and benefits included provision for dependents.

The position is different for income-related benefits, but the issue is not whether a couple are living in or out of wedlock but whether a man and woman form a common household. Where a couple form a common household, it is right that the help that they get takes account of shared costs, such as heating costs. It is a

long-standing principle that unmarried couples should not be treated more or less favourably than married couples. A couple living together as husband and wife should be treated in the same way as a married couple. There are some 270,000 pensioner couples receiving the minimum income guarantee and it is estimated that no more than 10,000 of them are unmarried. That comparatively small number is not a reason for changing the rules of the pension credit. In an increasingly tolerant society, to do so now would seem a backward step.

When a decision-making officer is satisfied that a couple are not living together as husband and wife, separate benefit claims can be made. Rates for couples are lower than twice the single rate. Some 30 per cent. of the households that will benefit from the pension credit will be couples, and 70 per cent. will be single people, of whom more than three quarters will be single women. Clause 5 is important in the calculation of pension credit and without it we would be unable to calculate fairly either the guarantee credit or the savings credit for couples. Single pensioners and couples are entitled to pension credit. It is only right that couples' entitlement should be based on the income and capital of both claimant and partner.

The concept of household membership is an important and long-standing one in social security generally and is especially important in income-related benefits. In seeking to be fair to all, we need to ensure equity of treatment for pensioners, whether single or members of a couple. That is why clause 5 ensures that any income or capital of the partner is aggregated with that of the claimant. That allows us to consider a couple's joint income and capital when calculating the guarantee credit and the savings credit. That arrangement has been introduced from the income support system with the advice of parliamentary counsel.

Amendment No. 26 would remove the regulatory power to provide exceptions to the principle of aggregation. We will accept the proposal simply to allow us to debate the issue. The hon. Members for Daventry and for Hertsmere alluded to the examples in the explanatory notes. They are explanatory, and there is no need for further clarification.

The hon. Member for Daventry was right, and I shall use a phrase that means exactly the same as what he said to his colleague, the hon. Member for Hertsmere—it is a belt-and-braces regulatory power. The hon. Member for Daventry, in his discourse with his colleague, asked whether there was any specific reason for it and whether it could be used in future years, if issues arose. There are no plans to put forward regulations using the power. If we were to use the power at some time in the future, the effect of not aggregating a couple's income or capital is that we would totally disregard the income or capital of the claimant's partner. That can only be an advantage to them.

Will the Minister give way?

May I finish this point first, so as not to disturb my train of thought so early in the morning?

To assist in the explanation, I shall provide a potential example. The word ''potential'' is underlined three times. The power could be used if we wanted to encourage a pensioner's younger partner—someone of working age who may be looking for employment—back into the labour market. It may be appropriate in such a case to disaggregate the couple's income so that we could ignore that for earnings purposes.

I am grateful to the Minister for giving way. There is nothing wrong at all with his train of thought this morning—it is on time. However, may I take him back to what he said a moment ago about the Government not having any intention to use the regulation-making power? What would happen in the circumstances that are foreseen in the explanatory notes, which I spelled out in my opening remarks, in which a partner receives income from a trust but does not receive any benefit from it?

I really have nothing to add to what I said, not because I have not read the notes or do not know anything else about the clause, but because the trust does not provide any financial gain to the couple, so it would be totally wrong to include it in any process of consideration. For example, the trust could be maintained for children or grandchildren of the couple or for a relative who suffers physical or mental disabilities and requires someone to be responsible for the trust on their behalf, but the couple would receive no income whatever or any other form of support from the trust. We gave that example to indicate that there are exceptional circumstances, and it would be wrong to have regulations that are set in concrete.

Clearly, if someone is acting on behalf of someone else in such a capacity, they are probably also acting in a caring capacity. Therefore, it would be wrong to penalise them for carrying out a good citizen's duty in acting for a close relative, a close friend or someone else—perhaps a tenant—who requires additional support, which is linked with a trust.

I am grateful to the Minister for his helpful reply. I was not disagreeing in any way, shape or form with the proposition that such income should be excluded from the aggregation. It is right that it should be excluded. My point was on the use of the regulation-making power. I presumed from the fact that an example was cited in the explanatory notes of a case where the regulation-making power might be used to exempt income from being taken into account and aggregated, that there was a risk that such income—income that comes to one of the couple from a trust on behalf of another—might be taken into account in the aggregation. I was simply asking whether the regulation-making power would be used to deal with that case. I shall certainly consider carefully what the Minister said in his helpful reply.

I was not aware of the connection with section 136 of the Social Security Contributions and Benefits Act 1992. The information was not at my fingertips, but I

had a feeling that there might be similar provisions elsewhere. I shall certainly look at how that operates.

I said in my opening remarks that this is a safety-first measure. We have no plans to bring forward regulations at this stage, because the measure allows us flexibility. Flexibility always ends up on the side of the pensioner in such circumstances. It would seem at the outset of this new and almost unique way of providing additional income that we should allow ourselves to transfer from the 1992 Act to this one a flexibility that may be of use to a particular group of claimants, which has not been yet identified.

As I said, the Minister's remarks have been helpful. They have put the power in context, and have given an indication of how it might be used in future to give greater flexibility. I shall consider his comments carefully. The debate has been useful, and has drawn out from the Minister another example, which sounded worthy, of where the power to disaggregate might be used to encourage someone to work. The Minister has indicated the background to Government thinking on the power, so I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 ordered to stand part of the Bill.