Clause 3 - Entitlement: special cases

Age-Related Payments Bill – in a Public Bill Committee at 10:00 am on 25 May 2004.

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Question proposed, That the clause stand part of the Bill.

Photo of Malcolm Wicks Malcolm Wicks Minister for pensions, Department for Work and Pensions

The clause is about special cases and deals with the less straightforward conditions under which a person would be eligible for payment. Those conditions are that each qualifying member of a couple will be entitled to a £50 payment if they live in the same household as another qualifying couple or couples, and if none receives an income-related benefit. If only one member of a couple qualifies, a £50 payment, rather than the full £100 household payment, will be made for that qualifying individual, and the same will happen for the other qualifying couple.

On Second Reading, the hon. Member for Spelthorne (Mr. Wilshire) asked why we treated couples living together in this way. The payment is made to households; where two or more couples share a household, it is right that they should be treated individually, in the same way as single people who share their accommodation with others. If a couple both qualify for the payment and are receiving pension credit, the one who receives a winter fuel payment will be entitled to the payment. They will be treated as one unit.

A person living in a care home, and who has been there for the 12 weeks prior to the relevant week, will be entitled to a £50 payment if they are not receiving pension credit. There will be no entitlement if they are receiving pension credit. On Second Reading, I was asked why we were using the 13-week cut-off date for people in care homes. It mirrors the provision for care home residence in the winter fuel payments. If someone is in a care home for a minimum of 13 weeks, it is fair to draw the inference that their stay is other than a temporary arrangement. In essence, the care home has become their home. The conditions follow principles applied to winter fuel payments, with which the payments will be made, to ensure fairness and smooth administration.

Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions

I want to get the issue of people in care homes straight. As far as I can see, this is more means-testing; it is even more confusing. If I were 71—wearing well, but 71—and I lived in my own home, I would get £100, whether I was on pension credit or not. However, if I had become ill, needed to be looked after and went into a care home 13 weeks before the qualifying date, I would not get £100; the maximum I could get would be £50, if I read the clause correctly. However, if I were poor and on pension credit, I would not even get £50; I would get nothing.

Where is the logic in that? If people in care homes do not make a contribution to their council tax, and the Bill is about helping people with council tax, why have the Government decided to give them anything? Why do they get £50 if they are not on benefit, but nothing if they are? There is no logic in that. Will the Minister

clarify the way in which people in care homes are being treated and the means-testing element in what he described earlier as a universal payment?

Mr. Waterson rose—

Photo of Nigel Waterson Nigel Waterson Shadow Minister, Economic Affairs

I did not mean to wave the hon. Gentleman back to his seat, but I think that he had finished, or puffed out, as it were. I endorse his points: there is a real perversity here. Leaving aside the care home issue—we all know the problems with take-up—the fact that a pensioner was on full council tax benefit would make no difference; in theory, he would still get the £100. There is clearly a view that we are not going to pay any attention to the benefit system, even that part that is most closely related to the problem that the Government seek to address, albeit from the wrong direction, in our view, which is council tax rises. We are saying that people can get full council tax benefit and still get the £100, yet there is a bizarre distinction for people in care homes.

It is almost as if Ministers start off by saying, ''This is what we want to do. It is all very simple. We are going to give £100 to every pensioner over 70 and hope that we will avoid Armageddon on 10 June,'' but then the officials and draftsmen get to work. They start bringing in complexities that Ministers thought they could avoid by simply saying, ''We are going to give all of them £100.'' I have some sympathy with that problem because I suspect it happens in government regardless of which party is in power.

There appears to be a bizarre distinction. Let us take as an example the reasonably well 71-year-old guy living in his own home who gets full council tax benefit. He has gone to the trouble of filling out the forms and so forth. He gets the whole £100, yet some people in care homes will not get anything. Where is the logic in that?

Photo of Malcolm Wicks Malcolm Wicks Minister for pensions, Department for Work and Pensions

A person living in a care home for the specified period who is in receipt of pension credit at any time in the relevant week will not be entitled to the payment because their care and accommodation needs are being met through public funds. All their daily requirements, apart from a few items covered by their personal expenses allowance, are provided by the care home, which is paid for by public funds. That is another method of looking after that group of frail people. A provision which, broadly speaking, is about council tax will not apply. However, a wife or husband left behind when those people go into the care home will be eligible for the £100.

Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions

Would not the same argument apply to someone living in a private home on their own where the taxpayer is paying all of their rent, all of their council tax, and income support? Why do they still get £100, if this other person gets nothing?

Photo of Malcolm Wicks Malcolm Wicks Minister for pensions, Department for Work and Pensions

I recognise that there is a broad brush element to this, but the situations are not the same. I understand the hon. Gentleman's point, but if someone is living in their own dwelling, albeit with that

kind of support, most of the other living expenses are being paid by that elderly householder. That is not the case in the care home.

Question put and agreed to.

Clause 3 ordered to stand part of the Bill.