My Lords, this instrument was laid in draft before the House on 13 December 2012, and I confirm to the House that I consider it to be compatible with the European Convention on Human Rights.
This Government are clear that they are committed to continuing to support disabled people to play a full role in society. The reform of DLA and the introduction of the personal independence payment are central to this. We recognise that DLA plays an important role, but it is simply not working in its current form. In the past 10 years, the number of people claiming DLA rose by more than a third, from around 2.4 million to 3.2 million. That level of growth is not sustainable.
We could have reduced expenditure by simply cutting money across the board. Instead we chose the principled but more difficult option of modernising the benefit and focusing support where it is needed most—on those who face the greatest barriers to independent life. I accept that this reform will mean that we spend less money on PIP than we would have spent on DLA, and that fewer people will receive the benefit—300,000 fewer by October 2015 and 600,000 fewer in steady state. We have not hidden from this. However, this has to be put in context. The UK remains a world leader in protecting the rights of disabled people. We currently spend almost £50 billion a year on support and services for disabled people. We will still be spending more on DLA and PIP in 2015-16 than we did in 2009-10 or 2010-11.
Importantly, this reform has also allowed us to ensure that the money we are spending is used effectively and fairly, and will go to the people who need it most. More people will receive the highest rates of the benefit than at present, both in terms of the proportion and the actual number of people receiving the benefit. The proportion of individuals who receive the top rates of both DLA components is 16%. Under PIP
this will rise to 23% and will be worth £134.40 a week, based on April’s rates. More individuals will receive the enhanced rate of the daily living component in PIP than receive the highest-rate care component in DLA.
The Government’s reforms present an opportunity to start afresh and make the benefit fit for the 21st century while keeping the best elements of DLA that disabled people value. Throughout the development of PIP we undertook extensive stakeholder engagement to ensure that disabled people and their organisations were able to feed in their views and concerns. We listened, and in many cases acted on what we were told. Our commitment to consultation was recognised by the Secondary Legislation Scrutiny Committee. We are continuing this engagement as we move into the delivery phase of PIP.
A key area where we listened to and acted on people’s views was the timetable for reassessment of the DLA caseload. We announced in December that this would take place more gradually, allowing more time to make sure that we get the implementation of PIP right. The peak period of reassessments will now not start until October 2015. This will also allow time for the first independent review of PIP to be carried out and any required changes to be implemented before reassessment of the bulk of the DLA caseload starts, from October 2015.
7.30 pm
We have also made a wide range of changes to the assessment criteria, following two extensive consultations. For example, we heard the concerns that we had not taken great enough account of the ability to read in our second draft of the assessment criteria. To rectify this we have introduced a new activity so that we can separately assess the ability to read and understand written information and the ability to communicate verbally. In addition, we have broadened our approach to aids and appliances, recognising that disabled people can be reliant on non-specialist aids to complete everyday activities, which can create costs and barriers.
I know that there is some continuing concern around the assessment, particularly in relation to the physical mobility activity—that is, moving around. We have already discussed the issue in this House. However, I would like to take this opportunity to reassure noble Lords once again that we have not tightened the rules regarding physical mobility. I must stress that, under the second draft of the assessment, being unable to walk 50 metres did not automatically entitle claimants to the enhanced rate. The policy intent behind this activity has always been that being unable to walk more than 50 metres should lead to entitlement to some rate of the mobility component. Within this, we intend that the enhanced rate should go to those individuals who face the greatest barriers to mobility and the standard rate to the remainder.
In the second draft, we differentiated by looking at the type of aid and appliance that an individual used; but we did not do it well. We used terms such as “up to” certain distances, which meant that it was not clear which descriptor applied. As such, people received variable outcomes. The strong response from our consultations and meetings with disability organisations
was that the criteria were very unclear. Many organisations told us they believed that only people who needed to use wheelchairs could receive the enhanced rate. We heard this from the Disability Benefits Consortium, the MS Society, Parkinson’s UK and Leonard Cheshire Disability, among others. In the final version of the criteria we differentiate by distance, which we feel is much clearer. This means that, in the final draft, individuals who cannot walk 20 metres can be certain that they will receive the enhanced rate, regardless of whether they need an aid or appliance.
I must also stress that this has to be looked at in the context of whether individuals can complete activities safely, to an acceptable standard, repeatedly and in a reasonable time. So, if individuals can walk more than 20 metres but cannot do so in a safe and reliable way, they should receive 12 points and the enhanced rate. Our analysis shows that, when you compare the second and final drafts of the assessment criteria, the projected number of people who will score 12 points under the moving around activity will remain broadly the same, despite a reduction in the overall mobility caseload.
At this point I would like to reconfirm that the Government will lay an amending regulation to make clear that consideration must be given to whether individuals can complete the assessment activities,
“safely, to an acceptable standard, repeatedly and in a reasonable time period”.
I have already shared a draft of the amending regulation, and we commit to putting a final regulation before Parliament shortly.
I am aware that both the House and disability organisations are as interested in how the assessment providers will carry out the assessment as they are in the policy itself. As always, the legislation will be underpinned by guidance, and we made the relevant guidance for assessment providers available on the DWP website on 23 January so that noble Lords could consider it before today’s debate. It will remain under review and will continue to be refined. We have also shared relevant extracts of the working draft of the decision-makers’ guidance.
I would also like to address some of the concerns that have been raised about the impact that these changes will have on carers. Informal carers provide an invaluable service to some of the most vulnerable people in our communities. The Government absolutely recognise and value their contribution, and enabling carers to fulfil their potential remains central to the Government’s carers strategy. That is why we believe that welfare reform must support carers’ independence. Under universal credit there will be a carer element to support carers on a low income who provide care for a severely disabled person. Additionally, such carers will have improved opportunities to maintain links with the world of work by being able to keep more of their income from working than under the current system.
As part of our approach, the Government also announced that carer’s allowance will continue to exist as a separate benefit outside universal credit, providing carers with the support of a dedicated benefit; and we will continue to uplift it with inflation. We also made it clear more than a year ago that both rates of the daily living component of PIP will provide access to carer's
allowance. This was welcomed by Carers UK, and we will enshrine it in primary legislation—indeed, we have shared the draft provision that does so with Carers UK. The latest available information shows that there were more than 1 million people with an established entitlement to carer’s allowance. Of these, some 269,000 have a carer’s allowance claim in payment, linked to an award of DLA in respect of someone of working age.
By October 2015, when we will have completed 560,000 DLA reassessments, the overall change in the carer’s allowance workload where benefit is in payment, will be a reduction of just 5,000 awards. It is important to put this in context. Expenditure on carer’s allowance continues to rise. On average, it has increased by 5% in real terms over the past four years and will continue to increase every year up to 2015. We currently spend £1.9 billion on carer’s allowance, and this is expected to rise to more than £2 billion by 2015. Our approach means that those caring for disabled people with the greatest needs will continue to get the support they need.
I hope that this short opening reassures noble Lords that this is a sensible reform. It has been developed in close collaboration with disabled people and their representatives. We have listened to concerns and acted on them. Therefore, I present to the House today a set of regulations that will ensure that we can provide disabled people with a new, more sustainable benefit, which will reflect modern society and allow us to continue helping disabled people to live full and active independent lives.
Amendment to the Motion