Tenth Standing Committee on Delegated Legislation
Wednesday 24 March 1999
[Mr. Bowen Wells in the Chair]
Draft Social Security (Incapacity, Earnings and Work Trials) Pilot Schemes Regulations 1999
4.30 pm
The Parliamentary Under-Secretary of State for Social Security (Mr. Hugh Bayley): I beg to move,
That the Committee has considered the draft Social Security
(Incapacity, Earnings and Work Trials) Pilot Schemes Regulations
1999.
I share with the Committee my pleasure, Mr. Wells, at
being under your chairmanship. As I entered the Room,
I heard you saying under your breath, "I hope that he is
not going to make any mistakes." I can put my hand on
my heart and say that I have never been to a Committee
considering a statutory instrument and made a mistake.
That is perfectly true, because never before have I been a
member of a Committee considering a statutory
instrument. With your guidance, Mr. Wells, I hope that
my so far perfect record will be maintained.
on Delegated Legislation
The regulations form part of the Government's policy
of helping disabled people move into or to try out work.
They are the first regulations to be made using the new
piloting power provided under the Social Security Act
1998. That power allows beneficial changes to be made
on a pilot basis, to see which are the most effective in
helping people with disabilities or long-term illnesses who
wish to move towards the world of work. I shall describe
how the regulations will help them.
The regulations provide for two pilot schemes the
incapacity earnings provision, and work trials. The pilot
schemes will operate for a year from 11 April 1999. The
schemes will operate in 15 Benefit Agency districts that
cover areas in England, Scotland and Wales. They will
thus be available to more than 300,000 people who live
in the locality of those pilot offices and who receive
benefit on the ground of incapacity. They are part of a
package of measures, which will also include testing the
introduction of a jobfinder grant of £200 and a jobmatch
payment of £50 a week payable for six months. The
regulations will modify the Social Security (Incapacity for
Work) (General) Regulations 1995 for those who can
benefit from the pilot schemes.
The first scheme, for work trials, will allow people who
have been incapable of work for more than 196 days to
be treated as being incapable of work while undertaking
work trials, a current Employment Service programme for
jobseekers. The programme will allow employers to offer
vacancies to clients on an unpaid basis for up to 15
working days. That will provide an opportunity for clients
to try out a job, to see if it suits them, and it allows
employers to evaluate the suitability of clients. During the
trial, the clients will remain on benefit, and the employers
and clients take part without obligation. Work trails are
used for full-time vacancies of at least 16 hours a week
that are expected to last for at least six months.
The second pilot scheme is for incapacity earnings. The
provision will allow people living in a pilot area to do a
small amount of any work, subject to a limit of £15 a
week without losing benefit on the ground of incapacity.
That can provide a valuable stepping stone for people
wanting to move into work.
The regulations also provide for a smooth end to the
pilot schemes if it is decided not to run further pilots or
if the schemes are introduced nationally. On the expiry of
the regulations, a person will be able to benefit from the
pilot measures for a further six months. That will give
people a reasonable time to adjust to the ending of the
pilot schemes.
The two schemes are designed to give people claiming
incapacity benefit the opportunity to try out work without
losing their benefit, and we hope that they will give some
of those with disabilities a real opportunity to take the
first steps in moving from benefit into work.
To inform future decision-making, we shall be
undertaking a comprehensive monitoring and evaluation
of the pilot schemes. That will allow us to understand
the impact of the regulations, and to decide whether it is
appropriate to implement the changes nationally.
In the past, the welfare system marginalised people
with disabilities by writing them off to a life of
dependence. We have a duty to recognise the skills,
abilities and ambitions of disabled people. We are
therefore reforming the welfare state to make it inclusive
and to empower disabled people to achieve their
ambitions.
We are aware that many people suffer a severity of
disability or a degree of ill health that means that they
cannot work. We are committed to giving them financial
support, so that they can live dignified and secure lives.
However, 2 million disabled people already work, and
surveys suggest that more than 1 million others want to
work. We want to help them.
Our approach is based around four strands. First, we
are removing obstacles to working from the benefit
system. We have introduced a one-year linking rule for
incapacity benefits and have removed restrictions on
voluntary work. Before the change, the higher rate of
incapacity benefit linking rule lasted for only eight weeks;
we have extended it to 52 weeks.
Secondly, we are implementing measures to ensure that
work pays, such as the introduction of the national
minimum wage and the new disabled person's tax credit.
Thirdly, we are promoting radical changes in the
workplace to ensure equality of opportunity. We are
building on the provisions of the Disability Discrimination
Act 1995, introducing the disability rights task force and
working to set up a Disability Rights Commission.
Fourthly, we are providing active help and
encouragement to people with disabilities to move into
work through our new deal for disabled people.
All that is no less than a systematic attack on the
barriers to work that are faced by disabled people. Many
disabled people want to work, and we are firmly
committed to helping them do so by focusing on their
capacities rather than their incapacities. Given that aim,
and given that the regulations have been supported by
disabled people and the organisations that represent them,
I trust that the Committee will have no hesitation in
welcoming such beneficial and worth while changes.
I commend the regulations to the Committee.
4.37 pm
Mr. Eric Pickles (Brentwood and Ongar): It is a great
pleasure, Mr. Wells, to serve under your chairmanship and
with your guidance. The Minister said that this was the
first statutory instrument that he had taken through the
House. If so, it bodes well for the future, because he did
an excellent job except when he strayed off the subject
and made a number of what I considered to be false
suggestions about the Government's policy on disabled
persons. I do not take issue with him on that it is a
matter for another day but I do not understand how a
Government who want to get rid of the contributory
principle and who want to tax those disabled people who
have made their own pension provisions can be said to be
acting in the best interests of disabled persons.
The two schemes deal with the £15 of earnings and
with work trials. It is not our intention to oppose the
regulations; indeed, we intend to vote for them. However,
a number of questions arise, and I should be most grateful
if the Minister would be kind enough to answer them.
I should be most interested to know who chose the
areas, and what were the criteria for choosing them. The
regions listed in the schedule include "East London and
Anglia" . Only one district, Newham, and three offices are
listed, all in the London area. The schedule would be
better if there was something in the eastern area in
Essex, Suffolk or Norfolk. There is nothing in that area
at present.
The Minister said that 1 million disabled people wanted
to work. Does he have an estimate of the number of
disabled people who will take part in the pilot schemes?
Mr. Bayley indicated assent.
Mr. Pickles: That is excellent. I would be grateful if
he would tell us what his estimate is.
Mr. Andrew Miller (Ellesmere Port and Neston): I am
trying to follow the hon. Gentleman's logic about the
eastern region. I thought that King's Lynn, for example,
and several other offices were in the east.
Mr. Pickles: I come from that part of the country, and
I do not consider that to be eastern England. I wanted to
know what had happened to Essex, Suffolk and the
eastern side of Norfolk. That is a reasonable question.
I am glad that the hon. Member for Ellesmere Port and
Neston (Mr. Miller) is taking an interest in our
proceedings, and I hope that my response has satisfied
him.
Will the Minister suggest how many disabled people
are covered, and will take part in the pilot schemes? Will
he say what the Government regard as a good success rate
and as a realistic target to achieve? I understand that he
can do so as, in another place, Baroness Hollis of
Heigham, who has responsibility for each matters, said:
"We know that there is a rather high success rate with these trials
and that people are kept on." [Official Report, House of Lords,
23 March 1999; Vol. 598, c. 1281.]
I also understand that the regulations suggest that
benefits will not be affected by the 15-day rule or by
people undertaking small amounts of additional work.
Will he spell out what people's benefit rights will be
during the pilot schemes? Will those rights continue
throughout and beyond the schemes? If a person decides
to take additional paid employment after the pilot is
finished, will that be regarded as evidence of whether he
or she is capable of work?
I am slightly at a loss about the disregard of earnings
of £15. My understanding is that the only restriction is on
the amount that a person can earn before it affects benefit.
Late last night, Baroness Heigham said:
"The kind of situation we have in mind is where someone with a
substantial learning difficulty may only want, or be able to work,
two or three hours a week such a person would be able to keep all
of the earnings unless he or she is paid extremely generously up
to £15 without it affecting their benefit." [Official Report, House
of Lords, 23 March 1999; Vol. 598, c. 1280-1.]
She then discusses the effects of the 16-hour rule, at
which point the disability working allowance kicks in. Am
I right in saying that the hon. Gentleman's interpretation
is correct and that what we are considering will not be
quite as limited as Baroness Hollis suggested yesterday?
Why was it decided to stick to the figure of £15? Was
that because it relates to the figure that is currently
disregarded with respect to income support? The Royal
National Institute for the Blind has commented that it
proposes
"a review of the level of the disregard to reflect inflation given that
the level of £15 has stayed the same since 1988, and would in fact
be worth £27.80 if it were uprated in line with the retail price index."
There is nothing magical about the figure of £28, but it
would provide an indication of the Government's general
intention. A disregard of £15 is materially different from
one of £27.80, with respect to the hours that a person on
incapacity benefit might be tempted to work. If the
Minister, rather than Baroness Hollis, is right and there is
no restriction with regard to time, what is the effect of the
national minimum wage?
Baroness Hollis talked yesterday about people with
severe learning difficulties. The people whom I have in
mind as likely to benefit from the provision are those with
moderate learning difficulties. Time and again they seen
to fall between two stools and be forgotten in the context
of incapacity benefit. The gaining of work experience by
people with moderate learning difficulties involves a
problem that has mainly to do with education. There are
several arrangements analogous to the scheme in question
under which colleges offer a bridge to employment.
Schemes of about six months' duration enable people to
learn basic skills to equip them for the work force. They
involve fairly simple stuff, such as dealing with money,
using public transport, telling the time and generally
acquiring confidence.
If the schemes that I have described are funded by the
college, eligibility for incapacity benefit is not affected.
However, as the Minister probably knows, several
schemes are funded through the youth service, in which
case incapacity benefit is lost. As far as I understand the
regulations, that is because such youth service schemes
are regarded as employment. I should like to know
whether a relevant person in a pilot area would qualify
under the scheme that we are considering to take such
important courses in preparation for work opportunities.
The Minister has spoken of a figure of 1 million he
will give a smaller figure when we deal with the question
of the pilot schemes. I am sure that the Government intend
to make a material difference and to get people
confidently into employment. If the Minister were to say
yes to this category of people, the effect on getting those
receiving incapacity benefit into work would be
considerable.
4.49 pm
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