House of Lords
Tuesday, 10th April 2001.
The House met at eleven of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers--Read by the Lord Bishop of Chelmsford.
Royal Assent
The Lord Chancellor (Lord Irvine of Lairg): My Lords, I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Acts and Measure:
Criminal Defence Service (Advice and Assistance) Act,
Housing Benefit Fraud
11.7 a.m.
Lord Campbell of Croy asked Her Majesty's Government:
- What progress has been made in reducing fraud in the system of housing benefit.
The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham): My Lords, the administration of housing benefit is the responsibility of individual local authorities. We are working with them to ensure that housing benefit is administered securely and to drive out fraud and error.
Lord Campbell of Croy: My Lords, I thank the noble Baroness for that reply. As a simple way of reducing this kind of fraud has been used effectively by some local authorities, involving unidentifiable envelopes--a move recently discussed in this House--are the Government encouraging other local authorities to adopt it? Furthermore, can the noble Baroness confirm that housing benefit fraud is still costing this country a huge amount of money?
Baroness Hollis of Heigham: My Lords, I shall respond first to the noble Lord's second point. We estimate that housing fraud and error--incorrect
payments--are running at around £840 million. That is detected fraud, but of course there may well be other fraudulent claims that we are not yet catching. This year we are introducing for the first time a housing benefit accuracy review, as a result of which we hope to have more reliable figures.As regards the noble Lord's question about unidentifiable envelopes--a matter which he has pursued in the past, most helpfully--I am happy to tell the House that something in the order of 350 out of 409 local authorities now take part in the "do not redirect" scheme for envelopes. As a result, those giros being paid direct to landlords on behalf of their tenants are no longer sent to landlords once their tenants have moved on. That was one of the main sources of fraud.
Lord Astor of Hever: My Lords, following the pilot projects testing different housing benefit application forms, can the Minister tell the House whether this has led to a common, baseline form, which should help to reduce the incidence of fraud?
Baroness Hollis of Heigham: No, my Lords, at present local authorities are still using different types of form even though this is a nationally administered benefit. However, we are introducing an important development by ensuring that local authorities have access to more information. Around 400 local authorities now have access to essential DSS benefit information and, following the passing into law of the Social Security Fraud Bill, they will, where authorised, have access to information from banks and so forth. On that basis, we shall be in a position to look again at the forms to see whether more common literature can be produced.
Earl Russell: My Lords, does the Minister agree that the accuracy of housing benefit administration could be improved if information given to the local authority could be passed on direct to the Benefits Agency and vice versa? Would this help in the effort to decrease the incidence both of fraud and error?
Baroness Hollis of Heigham: My Lords, the noble Earl is absolutely right and I am sure that it would help in the fight against fraud and error. The difficulty with housing benefit is that it is a very high value benefit. In London in particular, housing benefit can be worth three times as much as, say, income support. Thus we have an extremely complicated benefit to administer as well as one that is attractive to defraud. In London, the benefit is administered by staff with a high turnover, matched by tenants who are highly mobile. That provides a recipe--if I may put it in those terms--for complex administration and an attractive capacity to defraud. However, the entire thrust of our reforms, including the measures contained in the Social Security Fraud Bill, is to provide a single, secure base providing common information. As a result, we shall ensure that people are neither paid inaccurately nor can they claim fraudulently.
Unemployment
11.11 a.m.
Earl Russell asked Her Majesty's Government:
- What proportion of the reduction in the claimant count for unemployment since 1997 is the result of people entering employment.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, changes in the stock of employment result from huge flows of people both into and out of employment, unemployment and inactivity. Since 1997, while unemployment is down by over 500,000, employment has risen by over 1 million. Employment has increased by more than the fall in unemployment because some job growth has been absorbed by people joining the labour force, for example, women returners, young people leaving education and returners from early retirement.
Earl Russell: My Lords, I thank the Minister for that reply. Is she also in a position to assist the House by giving further figures for those who have left the claimant count because, for reasons of age, they are no longer required actively to seek work? Other reasons may be that they have moved on to incapacity benefit or they have been excluded from the claimant count due to benefit sanctions.
Baroness Blackstone: My Lords, I cannot give the House those statistics. I shall be very happy to write to the noble Earl and set out the statistics for him in full.
Lord Bruce of Donington: My Lords, can the Minister give the House an indication of when the Government propose to use, on a consistent basis, the ILO figures for unemployment--which are their preferred way of expressing unemployment--instead of continuing to use the claimant count, which was a statistical device employed by the previous administration in order to hide the true figures of unemployment?
Baroness Blackstone: My Lords, the Government use both the claimant count and ILO figures. We do so in the monthly announcements about the levels of employment and unemployment. The numbers of unemployed on the claimant count now stand at 3.4 per cent. That is the lowest level since 1975. However, as I said, we do not look only at the claimant count. The numbers of ILO unemployed--that is, those seeking and available for work--have fallen by more than 500,000 since May 1997. That is the lowest figure for 20 years and now stands at 5.2 per cent. It is perhaps important to note that long-term youth claimant unemployment--those who have been unemployed for six months or more--has been virtually eradicated. It has fallen by approximately 75 per cent since May 1997 and is at its lowest level for 25 years. That is a pretty good record.
Lord McCarthy: My Lords, does the Minister agree that part of the confusion in the supplementary
question of the noble Lord, Lord Bruce, arises from the fact that we still publish these two different indices? Is it not time that we abandoned the claimant count, which was systematically manipulated by the previous government and is less and less representative of what is happening in the labour market?
Baroness Blackstone: My Lords, it is true that employment and unemployment statistics lost credibility under the previous government as a result of the constant changes that were made in order to try to bring down the figures of unemployed people, which were at about 3 million in the early 1990s. However, we believe that it is legitimate to use the claimant count alongside the ILO figures because it indicates how many people are claiming benefit and how the numbers of those claiming benefit have either increased or decreased, which is important for the public and Parliament to know.
Baroness Blatch: My Lords, if the Government are so vocal about the claimant count being discreditable, why do they still continue to produce it after four years.
Baroness Blackstone: My Lords, I have just answered that question. I do not need to repeat my answer.
Lord Marlesford: My Lords, is not the real triumph for Britain's restructuring the fact that since the war some 4 million jobs in the eight basic industries have been lost and that nearly all those jobs have been recreated in modern form?
Baroness Blackstone: My Lords, in my answer I should like to comment on what has happened since the Government came to power in 1997. There has been an increase in the overall number of jobs of 300,000--a very substantial increase--and some jobs have, of course, been lost. So restructuring is taking place. That will always be the case in a stable and flexible economy. It is important that we now have stability, a reasonable level of growth, low inflation and low unemployment figures.
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