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The relevant statutory sum for the purposes of the Vaccine Damage Payments Act 1979 is the statutory sum at the time when a claim for payment is made. The order therefore raises the statutory sum of a vaccine damage payment to £120,000 from 12 July 2007 for all successful claims made on or after 12 July. That means that the buying power of the payment is more than restored to its value in 2000. People who claimed before will receive the statutory sum in force at the time the claim was first made.
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Out of an average of 177 claims made each year about five claims are successful. Therefore, an increase in the statutory sum from £100,000 to £120,000 would result in associated costs of approximately £100,000 a year. That improvement for the few children and their families who may in future suffer as a result of vaccination shows that this Government remain committed to recognising those who are severely disabled as a result of a vaccination programme for the protection of the whole community. We have consulted the devolved Administrations and the Isle of Man, and they have consented to the making of the order.
A consultation exercise was not undertaken for this order as no substantive changes are to be made to the Vaccine Damage Payments Regulations 1979. The order simply increases the statutory sum which is payable under the Act. The purpose and scope of this order will enable the statutory sum of a Vaccine Damage Payment to be increased to £120,000 from 12 July 2007 for all claims received on or after this date. I hope that that receives a warm welcome this afternoon, and I commend the order to the Committee and beg to move.
Moved, That the Grand Committee do report to the House that it has considered the Vaccine Damage Payments Act 1979 Statutory Sum Order 2007. 18th Report from the Statutory Instruments Committee.—(Lord McKenzie of Luton.)
Lord Taylor of Holbeach: These Benches welcome the order. I am glad that the Government have decided to increase the amount paid in damages to the families of children disabled as a result of the vaccines they have been given.
The benefit to society of widespread vaccination for childhood diseases is incalculable. Our medical capabilities have reached the point that we have the potential to wipe out a number of the debilitating diseases that have caused pain and suffering to so many people. For example, worldwide child deaths from measles have fallen by 60 per cent since 1999; a wonderful achievement that goes way beyond the UN target.
Vaccinations do not benefit only the recipient. If a sufficiently high proportion of the population receives the vaccine, the disease can be eliminated entirely and children and adults who are unable for medical reasons to receive the vaccine are also protected. Keeping vaccinations up to the necessary level—about 95 per cent, I believe—is a long-term challenge, especially as incidences of the disease fall and parents perceive it to be less of a threat.
This damage payment is a good and necessary method of helping those families looking after children who have sadly become disabled as a consequence of vaccination. It goes some way to helping them bear the increased costs of raising a disabled child and easing the burdens that such care can impose on a family.
I am glad to see from the debate on this order in another place that only about five children are seriously disabled by vaccinations each year, as the Minister confirmed. I was less reassured though by
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While I am on the subject of efficiency and simplicity, I hope that the Minister will consider making changes to the amount of damages through an annual uprating in line with inflation. Regular small increases would be much fairer than the current system where increases are arbitrary and unpredictable, often creating large differences in the amount of payment from one year to the next. The current system, where concerned organisations have to rely on getting the ear of the Minister, is surely not the best way to ensure that payments keep their value over time.
Finally, I should like to mention the possibility of involving the pharmaceutical industry in setting up a voluntary fund to support victims. In another place, the Under-Secretary of State explained that the Government decided not to pursue this because of the negative response. Rather to my surprise, she gave the impression that it was a case either of continuing to provide support for the families of the disabled children or giving up that important work to concentrate on persuading the pharmaceuticals. Are the Government not capable of doing both?
I look forward to hearing the Minister respond to the points I have raised.
Lord Kirkwood of Kirkhope: I am happy to add my support for the order, thus giving it all-party support. I concur with much that was said by the noble Lord, Lord Taylor. The Vaccine Damage Payments scheme introduced in 1979 has been a success and the order recognises the need to valorise the awards. I absolutely acknowledge that in the recent past the Government have made not just the fourth increase in 20 years, but have reduced the percentage disability that triggers eligibility from 80 to 60 per cent. That has been very welcome too.
I am pleased that consultation has been undertaken with the devolved Administrations but, in parenthesis, I might say that on future occasions consultation with some of the interested bodies, pressure groups and others might be valuable too. Although this order is merely restricted to the nevertheless very important question of quantum, some of the circumstances and background environment of how disability is looked at have changed significantly since 1979. That is a good thing. I shall develop this point in a moment, but we should always reflect on how we can improve the support we give to families in these circumstances.
I agree that valorisation seems to be a natural suggestion to make in terms of how we uprate the awards. I perfectly understand that this is not a natural benefit under the normal term of the Acts. It is not even a compensation payment; it is simply a recognition of the fact that disability costs are greater for children who take the advice of the state and get
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Although this is therefore not a benefit payment, it is an award in recognition of medical damage. I still think that it would be possible—the department must have the ingenuity available—to get it shoehorned into our normal annual statutory uprating provisions. If we did that, I would feel safer. It is easy to forget some of these things. Four increases over 20 years is very welcome, but it is easy for the cost of provision for looking after young people, particularly those with disabilities, to run ahead of retail price indexes. We need to keep a close eye on that, and the only way of guaranteeing that the job is being done properly is to look at it annually.
The claims process could also be looked at. I said earlier that some kind of consultation with the pressure group community in advance of these orders might have been advisable. It is a flat rate award, but a sliding scale has been suggested. The Disability Rights Commission is doing valuable work on all this. It points out to us—and I am sure that we all want to recognise this in the course of approving the order—that not only does it estimate that it costs three times the normal amount to raise a child with vaccine damage compared with the average, but the statistics clearly demonstrate that households that have to make provision for disabled children are on average 17 per cent poorer in terms of average income. Those children are disadvantaged in a number of ways.
The scheme is extremely valuable, but we should always be looking at ways of improving it, and you can do that only if you are taking regular soundings from the pressure groups and the academic community interested in this; the Disability Rights Commission as well as the devolved Administrations. I am looking for assurances that the Minister is not just going to leave it to the next time we have an uprating order to have consultation on these matters. I hope that the department will keep them constantly under review. I hope that it will look creatively to see whether there is some way of attaching the award to the annual benefit uprating system.
I agree with my noble friend, who was interested in some of the success rates, such as five claims being approved a year out of 177 or so. The department must have data on trends. Is the success rate increasing or decreasing? Are these vaccination damage cases likely to increase? Is the science getting better? Are the vaccines becoming less prone to causing damaging side effects, in the way we have seen with the cases that have received these awards? Does the science give us long-term hope? Perhaps in the middle to long-term, vaccine damage payments will be much less required because the damage is much less, which is obviously what we all want.
With those cautionary questions adding to what has already been said, I am very happy to support the order and hope that it will be speedily introduced.
Lord McKenzie of Luton: I start by thanking both noble Lords for their strong and warm support for the draft order. I shall try to deal with the questions
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Lord Kirkwood of Kirkhope: Can the Minister confirm that there is likely to be another social security Bill winging its way that might be appropriate for a new clause sometime soon—if not next year, then the year after?
Lord McKenzie of Luton: I hesitate to speculate on what might be in the gracious Speech for the next Session of Parliament. I emphasise that under both the current Government and the previous Government, it has been uprated on a regular basis. To put it in context, if the statutory sum of £10,000 in 1979 had been upgraded annually, it would now be worth £34,000. So the process that has taken place has done a good deal more for recipients than an annual uprating would have achieved.
Both noble Lords asked about the number of applications that fail. The majority of claims to the payment scheme are unsuccessful because the vaccination did not cause the disability. In considering cases, medical advisers have regard to whether informed medical opinion suggests that there may be a causal link between the claimed adverse event and vaccination. Each claim is given individual consideration and factors taken into account include the nature and severity of the adverse event, its temporal relationship to vaccination, the person's previous medical developmental history and any relevant family condition for which the subject of a claim had a predisposition. There has been no recent review of the claims process.
To give some statistics, in 2006-07, there were four awards; in the year before, five; the year before, four; and the year before that, five. The number of claims for that period were, in 2006-07, 60; 106 the previous year; 111 the year before that; 165 the year before that; and 417 the year before that—that was associated with the change in some of the rules. There is an analysis, which I should be very happy to share with noble Lords. I have a tabulation that sets out the reasons why each of the claims was disallowed. If we look at the total number of claims since 1977-78, of 4,489, 3,645 of them were not accepted because causation was not accepted. I am happy to share that tabulation and provide a copy of it.
The claim form is about 10 pages long and it is suggested that it is quite straightforward to complete. The noble Lord, Lord Kirkwood, asked: why not introduce a sliding scale of disability? A sliding scale of disability and payments would run counter to the scheme’s principle of providing a straightforward single payment for those whom the Secretary of State is satisfied are severely disabled as a result of
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Both noble Lords mentioned the pharmaceutical industry and asked why it should not contribute. As requested by some lobby groups, we have broached the subject but we have not been able to find a mutually satisfactory basis for establishing such a fund. We should not allow the pursuit of that to hold up what we are doing with the order, but neither do I think that we should give up on it.
I hope that I have dealt with the points raised, but if noble Lords have any residual comments I shall be happy to try to answer them. The routine childhood immunisation programme has been a great success, as the noble Lord, Lord Taylor, said. Immunisation remains the safest way for parents to protect their children against these diseases. However, we must continue to recognise the very small number of children and their families who suffer from the effects of vaccine damage. It is seven years since the previous increase to the statutory sum. This proposal maintains the Government’s commitment to those who become severely disabled as a result of vaccination by restoring the value of the statutory sum to more than the equivalent of its 2000 value. I commend the order to the Committee.
On Question, Motion agreed to.
Child Support (Miscellaneous Amendments) Regulations 2007
4.46 pm
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord McKenzie of Luton) rose to move, That the Grand Committee do report to the House that it has considered the Child Support (Miscellaneous Amendments) Regulations 2007.
The noble Lord said: Getting the child maintenance system right is one of the most important matters that we face, as parliamentarians, as parents, and as a society. This House has always played a crucial role in national debates on the issue, and the considered views of the Members of this House has consistently both informed government thinking and improved the legislation that oversees this area. I think it is fair to say then that this House is well aware that the performance of the child maintenance system has fallen a long way short of the expectations of this House, and more importantly, of the people that the system is designed to help.
Noble Lords will know that the Government are taking action to reform the child maintenance system for the long term so that it is capable of achieving the important objectives we have set: to help tackle child
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Members of the Committee will soon have the opportunity to debate and scrutinise the Child Maintenance and Other Payments Bill. But there is still the short-term challenge, which we have already begun to address, particularly through the operational improvement plan, which is already showing improvements in several key areas.
The Child Support (Miscellaneous Amendments) Regulations 2007 will tackle problems that have been identified with the existing regulations. These need to be addressed now, before the proposals of the Child Maintenance and Other Payments Bill start to take effect.
The regulations will: change the way the Child Support Agency calculates the net earnings of a self-employed non-resident parent; end geographical restrictions on the courts’ jurisdiction over child support enforcement cases; and increase the time allowed for a non-resident parent who lives abroad to make an appeal, and the notice period that the agency must give such a non-resident parent before commencing certain enforcement proceedings.
The changes to self-employed income became necessary following a judgment of this House last year in the case of Smith. That case was an exceptional one. None the less, this House found that the meaning in legislation of “taxable profits”, which provides the basis for calculating such earnings, was ambiguous. The House ruled that the agency’s interpretation of “taxable profits” was incorrect. We have therefore taken this opportunity to clarify what we mean by providing a definition of taxable profits which corresponds to that used by HMRC; and to change the information used by the agency to calculate self-employed earnings. The result is that self-employed earnings as assessed by the agency will more closely match those of HMRC.
Currently, the agency uses the self-assessment tax return as the primary source from which to obtain a total taxable profits figure and calculate self-employed earnings. If a return is not available, the agency has looked to the tax calculation notice supplied by HMRC to the taxpayer instead. Following these amendments, the agency will use the tax calculation notice as the primary source of information, and this means that the agency will be basing assessments on earnings information which has been agreed by HMRC.
A key feature of the Smith case was the question of whether capital allowances should have been taken into account when calculating the non-resident parent’s income. The majority ruling of this House was that, in the current scheme, they should not. However, we believe that it is right to acknowledge the reality that over time assets tend to lose their value and that the loss should be offset against business income. This is something recognised by both HMRC and in good accounting practices. By using the tax calculation notice as the basis for assessment, capital allowances will automatically be taken into account, and this reflects our original policy intention that the
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The existing child support schemes provide an alternative method for calculating self-employment earnings when information submitted to or supplied by HMRC is not available. Under this method, earnings are obtained by deducting from gross business receipts statutory deductions such as income tax and national insurance contributions, and allowable business expenses. Currently, depreciation is not an allowable expense. These regulations reverse this, providing recognition of depreciation which will broadly mirror that intended for capital allowances.
Regulation 3 inserts a definition of taxable profits into the Child Support (Information Evidence and Disclosure) Regulations 1992 by reference to the Income Tax (Trading and Other Income) Act 2005. It also amends those regulations so that the agency can demand any information that is required from the non-resident parent to determine their taxable profits.
Regulation 4 amends the Child Support (Maintenance Assessments and Special Cases) Regulations 1992 to bring the new methods of calculating self-employed earnings into effect for the old child support scheme. Regulation 5 makes the same adjustments to the new scheme by amending the Child Support (Maintenance Calculations and Special Cases) Regulations 2000.
The Child Support Agency has at its disposal a number of enforcement measures to ensure that non-resident parents meet their child maintenance liabilities. Obtaining a liability order is usually the agency’s first step to enforcing child support debt. At present, an application for a liability order must be heard in the court in the area in which the non-resident parent resides. This means that the agency cannot make an application for a liability order against a non-resident parent who lives abroad. Similarly, appeals against deductions from earnings orders or enforcement of liability orders by distress must be heard in the court in the area in which the non-resident parent resides. This effectively means that non-resident parents who live abroad are unable to exercise a right of appeal in these cases. This is patently wrong and so we have removed these restrictions.
To complement the extension of the courts’ jurisdiction, the regulations also double to 56 days the time allowed for overseas NRPs to appeal against a decision to impose a deduction from earnings order, and they extend to 28 days the minimum notice period that the Child Support Agency must give an overseas non-resident parent when it intends to obtain a liability order. Removing the restrictions on courts’ jurisdiction will allow the agency to pursue centralisation of actions in respect of liability orders in future. This will improve the efficiency of its enforcement of maintenance arrears. To effect the
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I am satisfied that the statutory instrument before us is compatible with the European Convention on Human Rights. I commend these regulations to the Committee and I beg to move.
Moved, That the Grand Committee do report to the House that it has considered the Child Support (Miscellaneous Amendments) Regulations 2007. 19th Report from the Statutory Instruments Committee.—(Lord McKenzie of Luton.)
Lord Taylor of Holbeach: I was interested to hear the Minister’s introduction to these regulations, and was listening carefully in the hope that some of my questions about the amendments would be answered. I have found myself with many questions about this legislation. The Minister has explained that one of the amendments it contains is a response to the case of Smith. It was found that the agency’s calculations of taxable profits for the self-employed were ambiguous and had been applied incorrectly. It seems important, therefore, that in addressing this problem the Government take care to ensure that their legislation is not ambiguous, but is instead well thought through and fully assessed. That appears, however, not to be the case.
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