Introduction of Disability Working Allowance

Orders of the Day — Disability Living Allowance and Disability Working Allowance Bill – in the House of Commons am 8:30 pm ar 7 Chwefror 1991.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Mr Harold Walker Mr Harold Walker , Doncaster Central

With this it will be convenient to consider amendment No. 8, in page 10, line 46, at end insert 'or(d) When the claim for a disability working allowance is made or is treated as made he has a physical or mental disability which is likely to last for not less than six months.'.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State for Work and Pensions

Again, this is a very important amendment because it covers the central question of who qualifies for the disability working allowance. As hon. Members know, as the Bill is presently drafted, a person qualifies only if he or she is over 16, in paid work, has a physical or mental disability that puts him or her at a disadvantage in getting a job and does not have an income above a certain level, and where neither the person nor their family is entitled to family credit. In addition, a person must be in receipt of disability related benefits such as invalidity benefit, the severe disablement allowance, a disability premium included in income support, housing benefit or poll tax benefit, the disability living allowance or the attendance allowance.

One has only to read out that set of conditions for the problem to be clear. Large numbers of people with disabilities will be excluded either because they are already working, because they have a disability that does not satisfy the criteria for a qualifying benefit, because they have a disability that developed while in work or because, for whatever reason—it may be choice or a lack of information or advice—they have not claimed one of the qualifying benefits, even though they meet the eligibility conditions. It is for those reasons that the purpose of the amendment is to add a further qualifying category, namely, someone who has a physical or mental disability which is likely to last for not less than six months. The sort of people who would gain from this amendment but who are unlikely at present to passport to the disability working allowance include partially sighted people, people with arthritis, a mental handicap or multiple sclerosis. Those are just some of the main categories. Not all those groups are likely to be in receipt of a full-time incapacity benefit.

If the Government are sincere in wanting people with disabilities to get jobs and to be able to keep them, I would expect them to accept this amendment. It is carefully drawn in stipulating that the disability must be likely to last for at least six months, precisely so that it meets the Government's concern to exclude people with short-term disabilities.

Also, the structure of the amendment—the Minister will be aware of this—is no different from severe disablement allowance, where some claimants are automatically passported through the 75 per cent. disablement test but others may still qualify if they provide other evidence of their disability. We have modelled the structure of our proposal on that. The amendment simply builds on existing proposals within the disability working allowance.

Under those arrangements, at the time of a second claim after six months and for subsequent claims, claimants—according to a DSS note—will be given a list of functional disabilities and asked to show which apply to them. A simple point then arises. If the Department is developing a functional test to apply to claimants after six months of claiming disability working allowance, why cannot it be applied to claimants who are making an initial claim for disability working allowance but who are not receiving one of the passporting benefits?

That is the central question, and I hope that the Minister will accept the force of my point. If he does not, I should like to know how he can accept that the Department is developing that functional test for second and further claims but is not prepared to accept it for initial claims. I shall be interested to hear what he has to say.

When this was moved in Committee—I have the advantage of knowing the Minister's reply—the Minister said that it undermined the administrative simplicity of the system and that he was reluctant to return to the complexities of qualifying medical examinations. I do not think that any hon. Member wants to return to the complexities of qualifying medical examinations. However, what the Minister did not see and what we are trying to explain to the Government today is that the argument is irrelevant when a functional test of disability will exist for repeat claims for disability working allowance.

It is not true that medical examinations are needed to provide evidence of physical or mental disability. Why cannot such evidence be provided by a simple self-assessment questionnaire? I would be the first to agree that it should be backed up by supplementary evidence where that is needed. After all, since the Government have agreed to that for the purposes of the disadvantage test, which they favour, why not for this purpose?

Another of the Government's objections was that the amendment would require adjudication officers to make decisions involving complex judgments which might lead to more errors and dissatisfaction. Of course we all want to avoid errors and dissatisfaction, but if evidence of physical or mental disability can be based on a list of questions aimed at identifying a person's functional disabilities, the assessment would be straightforward. That again is what we propose. We do not believe that it involves complexity. We believe that it can be done in a relatively straightforward and common-sense manner.

The Government's other objection—as far as I know it is the only other objection—is that the disadvantage test is simpler. In Committee, the Minister said: We used this definition because we did not want to have to go into detail about the particular incapacity of individuals."—[Official Report, Standing Committee E, 17 January 1991; c. 201.] Again, hurray for that. No one wants to go into detail about the particular incapacity of individuals. Yet, according to the measures used by the OPCS researchers, in order to reach a measure of disability, the stages that will have to be gone through include selecting areas of disability, whether locomotion, dexterity, continence or any of the others, assessing the limitations resulting from each type of disability, rating the limitations on a 15-point scale of severity, establishing a common lower level or threshold for judging combinations of disability, and so on. In other words, there are considerable complexities involved in the disadvantage test.

For the reasons I have given, I believe that there are fewer difficulties in our proposal compared with the Government's advocacy of the disadvantage test. If the Government are sincere about wanting all disabled people to have the fullest opportunity to get and maintain jobs, I hope that they will accept the amendment and ensure that those who are excluded will be able to have the benefit.

Photo of Mr Nicholas Scott Mr Nicholas Scott , Chelsea

I am afraid that I have to disappoint the hon. Member for Oldham, West (Mr. Meacher). The Government cannot accept the amendments, although I understand why he has tabled them. When I look at what he is trying to achieve, it arouses some sympathy, but I hope that I can explain why it would undermine what we are trying to do by the introduction of DWA and why it would radically change the character of the benefit itself.

We made it clear in "The Way Ahead" that we are setting out to help people on incapacity benefits to make the transition into work when they are ready to do so. We set out a number of ways in which to achieve that. Among them were ways of helping people on the margins of capacity to work by removing the barriers within the benefits system which currently put them off making the attempt to get into work for the first time or to return to work after an illness or injury. The barriers are inherent in the current benefits system, where much too sharp a distinction is drawn between capacity and incapacity for work.

The hon. Gentleman seemed to imagine that we could avoid this if we went down the route he suggested, but I made it one of the priorities in the introduction of the new benefit to avoid the need for a claimant to undergo a medical examination. We also made a special effort to avoid asking adjudication officers to make decisions involving complex judgments. The hon. Gentleman drew attention to the fact that I used that argument in Committee. None the less, it is a strong argument, and I still feel strongly about the point.

I admit that the change is partly to make the processing of claims more straightforward and partly because it removes an area where there is considerable potential for errors and for decisions with which claimants are dissatisfied for various reasons. If we had to rely simply on the evidence of the functional test which the hon. Gentleman has described, without confirmation provided by the evidence of receipt of a qualifying benefit, a much more complex and thorough test would have to be applied for someone to qualify for the benefit. What we have suggested is simple and easy for staff to administer quickly, efficiently and accurately; it will also be simple for potential claimants to understand their entitlement.

I have already said that the amendment would widen the scope of DWA so much that it would entirely change the character of the benefit. I do not think that we could avoid a medical examination. It could, of course, bring in a large number of people at considerable cost.

Having said all that, I think that everyone knows the intention of the new benefit. We will monitor its effect carefully to make sure that it is doing the job for which it is designed. DWA is a new benefit, an entirely new concept within the social security system. I and my successor will monitor it carefully. At this point, I cannot accept anything like the amendment which has been proposed.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State for Work and Pensions 8:45, 7 Chwefror 1991

The Minister will not be surprised to hear that I find that a disappointing response. I do not think that he has seriously taken note of the arguments that I used. It would not be unfair to say that he has simply repeated the same arguments that we heard in Committee. I tried, perhaps not as successfully as I would have liked, to answer those arguments.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State for Work and Pensions

The right hon. Gentleman shakes his head. I believe that I did answer them. The problem is that the Minister simply repeated the original arguments without taking account of the points that I put against them.

We are agreed about not wanting to see disabled people having to undergo difficult or complex medical examinations. We do not want complex decisions being taken by adjudicating officers. The point that I was making, which he has not answered at all, is that the functional test of disability is the one that the Department is itself proposing for repeat claims. I asked a question which the Minister did not answer; if it can be done the second, third or fourth time, why cannot it be done the first time?

Photo of Mr Nicholas Scott Mr Nicholas Scott , Chelsea

Precisely because it is clear that the person has a qualifying benefit, which in a sense is prima facie evidence of entitlement to the allowance. If a person does not have that, it means that we would have to have a complex examination or test, which would undermine the simplicity of the benefit.

Photo of Michael Meacher Michael Meacher Shadow Secretary of State for Work and Pensions

In that case, the argument between us simply revolves round whether a functional test of disability is adequate in the first instance. It is clear from the exchange that the Minister believes that a medical examination cannot be avoided; in his view, it is requisite. We have to take account of the considerable evidence provided by the disability organisations—a serious, thoughtful and reflective body of opinion, with enormous experience of dealing with the disabled. It is their view that the functional test of disability could be effective. No doubt the Minister would say that they would take that view.

Although the Minister did not make much of this, I suspect that the real reason for his decision is that he believes that, if a functional test were to be used in the first instance, it would widen the scope rather too much, and we would be back once again to the question of cost. I suspect that he let that out a little carelessly, but perhaps I should be grateful for his honesty. I suspect that that is the real reason. I do not think that there is a technical problem. I believe that the Government wish to constrain the number of beneficiaries reasonably tightly and that the Department believes that it can do that only on the basis of a medical examination.

I can only stress the arguments that I used at the beginning of my remarks about the considerable number of people who will be disappointed. They believe that they have entitlement, but they will find that they are excluded. That will rebound on the Government. I support the purpose behind the new benefit, but I believe that it is tragic and short-sighted to exclude a significant number of disabled people. The amendment would enable people who are excluded to be included. It is a great pity that they will be omitted.

I hope that, once again, the Government will reflect further on the argument and on this exchange. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Mr Allen McKay Mr Allen McKay , Barnsley West and Penistone

I beg to move amendment No. 9, in page 11, line 48, after `percentage', insert '(which shall not exceed 40%)'. This small amendment arises from a debate in Committee, in which we sought to reduce the taper of 40 per cent. to encourage disabled people into work. The Minister decided that the Government could not afford that, which showed their lack of foresight. They should try to encourage disabled people into work.

We proved in Committee, and again today, that disabled people require more expenditure, attention and care than able-bodied people. We ask the Government to reconsider a reduction in the taper of 40 per cent. It would cost the Government considerably less than they suggested in Committee, and encouraging disabled people into work by giving them more money would be a worthwhile measure. A 94 per cent. tax on extra earnings is extortionate, and we would not impose that on anybody else.

Photo of Ann Widdecombe Ann Widdecombe , Maidstone

A shallower taper would give more money to all recipients, but it would give most to those who are better off. We do not regard that as a sensible use of the £30 million that it would cost, so I must resist the amendment.

Photo of Mr Allen McKay Mr Allen McKay , Barnsley West and Penistone

I am not satisfied with the Minister's answer. We shall return to the subject, at which time we will remind her of her words. Many people will be disappointed, but I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.