COMMITTEE FOR SOCIAL DEVELOPMENT
OFFICIAL REPORT
(Hansard)
Welfare Reform Bill
2 July 2009
Members present for all or part of the proceedings:
Mr David Hilditch (Deputy Chairperson)
Mr Mickey Brady
Mrs Mary Bradley
Mr Thomas Burns
Ms Anna Lo
Mr Fra McCann
Ms Caral Ní Chuilín
Witnesses:
Ms Janis Creane )
Mr Gerry McCann ) Department for Social Development
Ms Anne McCleary )
Ms Margaret Sisk )
The Deputy Chairperson (Mr Hilditch):
We welcome Ms Anne McCleary, who is a director in the Department for Social Development, Ms Margaret Sisk, from the social security policy and legislation division, and departmental representatives Mr Gerry McCann and Ms Janis Creane, to brief the Committee on the forthcoming Welfare Reform Bill.
Members will find in their meeting packs a cover note from the Committee Clerk, the Department’s briefing paper, the briefing paper from the Law Centre Northern Ireland, which was considered by the Committee on 2 April 2009, and the briefing paper from Assembly Research and Library Services, which was also considered by the Committee on 2 April. The equality impact assessment consultation document relating to the Bill has also been tabled in members’ papers.
The Committee welcomes Anne McCleary as the new director of the social security policy and legislation division of DSD — she has replaced John O’Neill. I pass over to you to give the Committee an outline and briefing, which will be followed by questions and answers. I ask everyone to ensure that all mobile phones are switched off.
Ms Margaret Sisk (Department for Social Development):
I am leading the presentation today because Ms McCleary is still fairly new in post. Hopefully, this will be my swansong as John O’Neill’s temporary replacement. I will try to keep the presentation as short as possible, as I realise that the Committee has had a fairly long meeting.
The key aims of the draft Welfare Reform Bill are to further reform the benefits system, to improve support and incentives for people to move from benefits into work, to simplify the benefits system, and to provide additional powers for the enforcement of child maintenance arrears. There are other measures, such as the extension of the higher-rate mobility component of the disability living allowance to blind or severely visually impaired people, and some changes to the social fund.
The Great Britain Welfare Reform Bill is going through the parliamentary process at Westminster. It is currently in Committee in the House of Lords, which means that it is possible that there could still be changes to the measures that we have outlined in the table that we provided for members. We expect the Bill to receive Royal Assent in the autumn, probably in November.
As I am sure that you have noticed, there are a number of measures in the Great Britain Bill that are not due to be replicated in the equivalent Northern Ireland legislation. Part 2 of the Great Britain Bill, which concerns the right to control provision of services, will not appear in the Northern Ireland Bill. The purpose of Part 2 is to enable disabled people who are aged 18 or over to exercise greater choice and control over the way in which certain services are provided for them by public authorities. There has been no consultation with interested groups in Northern Ireland or with the various authorities responsible for administering the services, and, as responsibility for the relevant services rests with a number of Departments and bodies, the issue of ownership needs to be resolved. Since it is not a social security matter, it is not considered necessary or feasible to include that measure in the proposed Bill.
Part 4 of the Bill provides for birth registration, which is the responsibility here of the Department of Finance and Personnel. The Department has decided that it does not want to legislate to require unmarried parents here to register the birth of their child jointly.
In addition, the Minister has decided that she does not wish to make arrangements for external providers to provide social loans here. She does not wish to mirror the Great Britain provisions that would allow for the introduction of a new regime to identify problem drug users, that is, people who are dependent on heroin or crack cocaine, nor does she wish to provide for the administrative withdrawal of passports from non-resident parents who refuse to pay child maintenance. In Northern Ireland, that will remain a court-based process.
I will briefly go through the main points of the proposed measures to be included in the Northern Ireland legislation. Many of the proposals are drawn from a report by Professor Paul Gregg, which is entitled ‘Realising Potential: A Vision for Personalised Conditionality and Support’. That was published alongside the welfare reform White Paper in September 2008. Professor Gregg recommended a system of personalised conditionality, matched by personalised support, with virtually everyone on working-age benefits being expected to take active steps to work.
The report identified three broad customer groups. The first group is a work-ready group for people who would be considered to be immediately job ready. The requirements for that group would be largely based on the jobseeker’s allowance regime. The second group is a progression-to-work group, which would be aimed at people for whom an immediate return to work is not appropriate but is a genuine possibility with time, encouragement and support; for example, lone parents and partners of benefit recipients with children who are under the age of seven. The third group is a no-conditionality group, which would be made up of people who will not be required to undertake work-related activity or take steps back to work. That group would include carers, the employment and support allowance support component group and lone parents of very young children.
The proposals for the work-ready group are designed to find a system of support that is most suitable for the circumstances of each individual. It is envisaged that an action plan would be agreed between the claimant and the advisor that would help the claimant prepare for work and move closer to the labour market. It would be possible for an adviser to direct a claimant to a mandatory work-related activity where necessary. The schemes will be piloted in Great Britain and evaluated to test their effectiveness before being rolled out nationally.
People in the progression-to-work group will only be expected to undertake work-related activity that is clearly appropriate to their particular circumstances. In doing that, consideration will need to be given to issues such as the availability of childcare and fluctuating medical conditions. Again, the schemes will be piloted in Great Britain for two years to test their effectiveness.
There are some new powers to apply benefit sanctions. There is a new provision to remove or reduce benefit entitlement for four weeks for all first offences of benefit fraud. The aim is to deter people from committing benefit fraud in the first place by making the benefit system more active and tougher on people who do not play by the rules. There will also be a loss of benefit sanction for job seeker’s allowance customers who commit acts of violence or use threatening behaviour against staff. There is also a new one-week benefit sanction for job seeker’s allowance customers who have failed to attend their mandatory appointments without good cause.
The Bill also contains a number of measures that support the goal of simplifying the benefit system. For example, it will allow claimants who currently claim income support to move to job seeker’s allowance with the same conditionality as income support. Those customers will not be required to meet the conditions of actively seeking and being available for work. The Bill will also allow for the aligning of the contribution conditions for ESA and JSA and for people who are not entitled to the full amount of statutory sick pay to claim ESA. The eventual goal is to abolish income support and to transfer claimants to JSA or ESA. There is no set date for the abolition of income support, but it is intended that it will gradually wither away as groups of claimants are transferred gradually to those other benefits. That could take a considerable amount of time. It will be done only as resources allow and it is clear how that change will fit others that are already under way.
A key proposal around the enforcement of child maintenance is the introduction of the power to administratively withdraw a driving licence from a non-resident parent who refuses to pay arrears. It is intended that the proposal will be piloted in Great Britain for two years to test its effectiveness and to ensure that it does not result in unintended adverse consequences. If it is decided that it should be rolled out nationally, we intend to introduce that measure here.
As I have said, the Bill would also extend entitlement to claim the higher rate mobility component of disability living allowance to prescribed categories of blind or visually impaired people.
The social fund change to which I referred will allow for successful community care grant applicants to be provided with the item that they have applied for, rather than money. The objective is to ensure that applicants receive value for money from their grants.
Members will be interested in the position on the Assembly process for the Bill in Northern Ireland. The Minister has not yet been asked to decide whether she wishes to seek approval for accelerated passage for the Northern Ireland Bill. As a first step, departmental officials must look at the implementation dates for the Bill in relation to the Great Britain Bill, and consider its impact on operational matters here. The Committee is also aware of the parity issue that we have spoken about many times, so I will not labour that point.
In conclusion, the purpose of the proposed changes is to support and encourage people, when possible, to move back into work. We consider paid work to be the best route out of poverty. The benefits of work are not just financial: there are health benefits, benefits to the individual’s self-esteem and the benefits associated with creating role models for children and families.
The Department recognises that it will face issues in implementing the proposals here, not least in the area of the availability of childcare and the resources that are available to Ministers to administer those changes, particularly in the Department for Employment and Learning. The Department also recognises that there is an economic downturn, but it does not believe that that should prevent preparing people for the move back to work when the situation changes.
The Deputy Chairperson:
I thank Ms Sisk. The Committee has been briefed a number of times on the draft Welfare Reform Bill’s provisions. To some members, it is like the curate’s egg — a mixture of the good and the bad — but they are very interested in what will unfold. The fact that the Minister has not made her mind up on whether to seek accelerated passage has been referred to, which brings the Committee to its present consideration of what steps lie ahead. The Committee would like to develop some of the arguments and may want to debate them at a wider forum.
Ms Sisk:
I absolutely understand that. The position is that the Department’s officials have not yet sought the Minister’s approval or decision on how she wants to move the Bill forward. Therefore, that is all that we can say at this stage, because it is entirely the Minister’s decision to make. She must then approach the Executive and the Committee. At present, it is too early in the process for us to approach her about that issue.
All that we are doing today is talking the Committee through the proposals that we expect to see in the Bill and that are covered in the equality impact assessment that is out to consultation until the end of September.
Ms Ní Chuilín:
Ms Sisk has answered the question that I was going to ask about accelerated passage. I am keen that that does not happen.
However, on an issue that we have raised before and that has been brought up in Assembly debates; given the absence of childcare arrangements here, is the Department minded to amend the Bill to ensure that lone parents will not be sanctioned? In Britain, local councils are responsible for childcare provision, but that is not the case here.
Ms Sisk:
I understand Ms Ní Chuilín’s point, and we have rehearsed that matter over the lone parent regulations that have been passed by the Assembly. During that debate, the Minister made it clear that she had built in extra operational flexibility to ensure that lone parents who cannot find childcare in Northern Ireland will not be sanctioned.
The Department’s policy is to use sanctions only as an absolute last resort in any case, whether a lone parent or any other person who is claiming welfare benefits.
The vast majority of the proposals in the Bill will be piloted for a considerable length of time in 10 or 12 regions of Great Britain before it is decided whether to roll them out. That will help to ascertain whether the use of sanctions is an effective mechanism. We will examine what emerges from the pilots before making any decisions about how the system will be designed here. We will have to engage with the Department for Employment and Learning, which will have a big part to play. I can assure you that no lone parent will be sanctioned if they cannot access affordable childcare.
Ms Ní Chuilín:
By the time the Bill comes before us, it is introduced and becomes an Act. Therefore, would it not make sense to seek an amendment to the Bill? A lot of childcare is funded through the community and voluntary sector, the funds of which are also stretched. Such an amendment could make it totally clear that no lone parent will be sanctioned.
Ms Sisk:
It is entirely up to any Member to table an amendment to the Bill when it is going through its process. Even if we ask the Committee to grant the Bill accelerated passage, you can still table an amendment at any time.
Mr Brady:
Thank you for the presentation. As someone once famously, or infamously, said, it is like déjà vu all over again. If I expressed all my misgivings about the draft Welfare Reform Bill, we would probably not get a recess; so I will try to make my comments relatively brief.
One of the major issues is the abolition of income support, which will have a major effect on my constituency. The Minister has told us that income support will be based in Newry and that the jobs and benefits office will be in Dungannon. Jobs will wither away if income support withers away, and that office may wither away eventually. It is a relatively new facility; I think that it was opened only in 2001. Presumably, DEL will not wither away, and, hopefully, it will flourish.
The system of having two benefit offices, such as the ESA and jobs and benefits in Dungannon, is not flexible enough to include the people who do not come under those two benefits. Indeed, the ESA has already caused tremendous difficulties, as it is centralised in contravention of the Bain report; that all needs to be addressed. Cáral mentioned the huge issue of childcare provision. That highlights the rationale that parity can be changed or moved when it suits, but is imposed when it does not suit.
There has also been mention of the sanctions that are imposed for fraud or alleged fraud. In my experience, there is fraud. That has to be condemned, but a lot of the sanctions result from wilful intent. Someone might ring up to report their neighbour for painting their door the wrong colour or for doing something else totally innocuous. I have difficulty with the fact that those people can face sanctions in the form of their benefits being suspended while the matter is investigated.
The Minister effectively chose not to take the Green Paper on board. Is consideration being taken of the White Paper? Carál mentioned that a lone parent who has a child as young as seven will now be expected to work. It is laudable to encourage people to go to work, but I come across the problems with working tax credits and chidcare, day in and day out. That issue has to be looked at, and not merely in isolation. I will not hold my breath, but I hope that the issues that affect the most vulnerable will be properly addressed in the next round.
I am not saying that you are coming out with platitudes but, as someone who has listened to them for the past 30-odd years, I must say that one can become highly sceptical and cynical. When I said “ déjà vu all over again”, I meant it. It is simply a rehash of what has been coming out since at least 1988, when supplementary benefit was abolished and income support was introduced. We were told that the social fund would be wonderful and that it would offer interest-free loans and community-care grants. That simply has not happened.
Social engineering, unfortunately, as has happened in the past, can go dramatically and drastically wrong. Unless we, in which I include the Department, the Committee and the Assembly, address the issues now, things will simply chug along, and people at the bottom will continue to suffer. We must be cognisant of that.
Ms Sisk:
You mentioned a huge number of benefit packages.
Mr Brady:
I do not expect you to address all of them.
Ms Sisk:
I will start with income support, because something occurred to me as you were talking about it. The potential abolition of income support is a long way down the road. There will be no particular date on which someone will declare that it has been abolished. Through time, the groups of people who claim income support will be moved on to other benefits. That relates to what you said about the strategic business review and the siting of jobs. The Department will have to consider what would happen should jobs no longer be available in, for example, the Newry office to handle income support.
When talking about sanctions for fraud, it is not exactly the same. Fraud is the deliberate intent to steal money from the benefits system, and clear evidence would have to exist before anyone could be sanctioned. I hear what you are saying about childcare, and we have been through that on numerous occasions previously.
The real test of the proposals will be how they are implemented. We want to see what happens when the GB pilot schemes are run, because it will be a couple of years before anything emerges from those. Only then will we see what happens to the group of people that is progressing towards work. Regulations will have to be made to implement the proposals. The vast majority of the regulations will be subject to the ministerial code and to the confirmation procedure in the Assembly. We will, therefore, have to come back you, Mr Brady, with all the details.
Mr Brady:
I cannot wait to live in Utopia.
Ms Sisk:
I am sure that you cannot wait.
Mr Brady:
It is just round the corner.
The Chairperson:
In the meantime, thank you very much for the briefing. It has been very useful.