New Clause 14 - Expenses of paying sums in respect of vehicle hire etc.

Welfare Reform and Work Bill – in a Public Bill Committee at 3:30 pm on 15 October 2015.

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“In the Social Security Administration Act 1992, after section 15A insert—

15B Expenses of paying sums in respect of vehicle hire etc.

‘(1) This section applies where—

(a) a relevant benefit component is payable in respect of a person (“the beneficiary”),

(b) an agreement has been entered into by or on behalf of the beneficiary with a relevant provider for the lease or hire purchase of a motor vehicle, and by virtue of regulations under section 5(1), the Secretary of State pays all or part of the relevant benefit component to the relevant provider for the purpose of discharging, in whole or in part, an obligation of the beneficiary under the agreement.

“(1) Regulations may make provision—

(a) for the expenses of the Secretary of State in administering the making of payments to relevant providers to be defrayed, in whole or in part, at the expense of relevant providers, whether by requiring them to pay prescribed fees or by deducting and retaining a prescribed part of the payments that would otherwise be made to them or by such other method as may be prescribed;

(b) for the recovery from a relevant provider of any fees or other sums due from that provider under paragraph (a).

(2) In this section—

“relevant benefit component” means—

(a) the mobility component of disability living allowance, if it is payable at the higher rate (see section 73(11)(a) of the Social Security Contributions and Benefits Act 1992), or

(b) the mobility component of personal independence payment, if it is payable at the enhanced rate (see section 79(2) of the Welfare Reform Act 2012);

“relevant provider” means a person whose business consists of or includes the supply by way of lease or hire purchase of motor vehicles to persons in respect of whom a relevant benefit component is payable.”’ —(Priti Patel.)

This amendment enables the Secretary of State to make regulations about recovering from an organisation the expenses incurred as a result of paying a claimant’s relevant disability benefit, or part of it, to that organisation.

Brought up, and read the First time.

Photo of Priti Patel Priti Patel Minister of State (Department for Work and Pensions)

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

Photo of Albert Owen Albert Owen Labour, Ynys Môn

With this it will be convenient to discuss Government amendment 130.

Photo of Priti Patel Priti Patel Minister of State (Department for Work and Pensions)

It is a pleasure to serve under your chairmanship this afternoon, Mr Owen.

The amendments are about fairness for taxpayers. Currently the Government divert benefit payments to Motability Operations Ltd on behalf of claimants who participate in the Motability scheme. That is of direct benefit to Motability Operations Limited, but the cost of doing it is borne by the taxpayer. The new clause seeks to rectify that by granting the Government the power to recover the expenses incurred in the administration of that arrangement and any similar future arrangement in respect of benefit diversion to an organisation that leases or sells motor vehicles to disabled persons.

Amendment 130 will enable the Government to exercise the power in England, Wales and Scotland. The power will not have an impact on customers. It will merely allow the Government to recover the expenses incurred in diverting the benefit. It has the support of Motability.

Photo of Debbie Abrahams Debbie Abrahams Shadow Minister (Work and Pensions)

New clause 14 and amendment 130 make provision for the Department to recover costs made in administering the payments to relevant providers for the lease or hire-purchase of motor vehicles for those in receipt of the higher rate mobility component of disability living allowance or the enhanced mobility component of PIP.

Currently, around 620,000 people lease vehicles through the Motability scheme for an average of £3,000 a year over three years. Concerns have been expressed about the number of people who previously qualified for the higher rate mobility component of DLA, but who failed to qualify for the enhanced rate of the mobility  component of PIP and so no longer qualify for the scheme. As the Minister is aware, about 360,000 current Motability scheme users will be reassessed between October 2013 and 2018.

What assessment has the Minister made of the numbers of people who to date will no longer be eligible for the Motability scheme? In addition, will the Minister inform the Committee of the cost to the Department of administering payments to providers, as outlined in the new clause? Will she estimate how much per lease the recovery of DWP expenses will cost? Furthermore, what estimate has she made of the recoverable expenses as a percentage of the overall average leasing or hire-purchase agreement? When will the Government produce an impact assessment for the provision?

I am sure we all recognise the importance of the vehicle-hire schemes to disabled people, and of the benefits that the independence of having a suitable vehicle brings in health, social, work and financial terms. My father-in-law was registered blind and, through a mobility scheme, my mother-in-law was able to drive him around. The independence that that gave him was very important to him.

Opposition Members would welcome the Minister’s assurance that the changes outlined in new clause 14 and amendment 130 will not negatively impact on a disabled person’s ability to secure access to vehicle leases and rental agreements, and the independence and the lifeline that they provide. We would also like assurances that there will be no further shifting of costs to disabled people.

Photo of Priti Patel Priti Patel Minister of State (Department for Work and Pensions) 3:45, 15 October 2015

I have a number of points, and I will come back to the hon. Lady specifically on quantity information and data. The measure has the support of Motability, and working with Motability is the right thing to do because Motability Operations Ltd provides great support for claimants. She makes it abundantly clear that a great deal of vital and valuable support is provided. This is a valuable lifeline to claimants.

The hon. Lady mentioned costs. I have some figures. The measure costs less than £1 million a year, and Motability has confirmed that it is affordable and will not have an impact on its users. She has specifically asked for further information, and I will ask officials in the Department to get back to her.

Photo of Neil Coyle Neil Coyle Labour, Bermondsey and Old Southwark

I welcome the Minister to her place. It is interesting to hear that Motability supports the amendment. Does the amendment arise from the expectation advertised by Motability that it will be forced to withdraw vehicles from disabled people as a result of the transition from disability living allowance to the personal independence payment?

Photo of Priti Patel Priti Patel Minister of State (Department for Work and Pensions)

My understanding is that there will be no impact on claimants who participate in the scheme. The measures are about ensuring the service and reclaiming costs in a fair way for taxpayers, as I explained in my initial comments. This is not about service provision changes. I hope that answers the hon. Gentleman’s question.

Question put and agreed to.

Question put, That the clause be added to the Bill.

The Committee divided: Ayes 8, Noes 5.

Division number 52 Decision Time — New Clause 14 - Expenses of paying sums in respect of vehicle hire etc.

Aye: 8 MPs

No: 5 MPs

Aye: A-Z by last name

No: A-Z by last name

Question accordingly agreed to.

New clause 14 added to the Bill.