Ordered to be printed 28 March 2017 and published 30 March 2017

Published by the Authority of the House of Lords

HOUSE OF LORDS

Secondary Legislation Scrutiny Committee

30th Report of Session 2016–17

HL Paper 148

Non-Domestic Rating (Alteration of Lists and Appeals) (England) (Amendment)

Regulations 2017Valuation Tribunal for England (Council

Tax and Rating Appeals) (Procedure) (Amendment) Regulations 2017

Social Security (Restrictions on Amounts for Children and Qualifying Young

Persons) Amendment Regulations 2017Child Tax Credit (Amendment)

Regulations 2017

Includes 5 Information Paragraphs on 5 Instruments

Secondary Legislation Scrutiny CommitteeThe Committee was established on 17 December 2003 as the Merits of Statutory Instruments Committee. It was renamed in 2012 to reflect the widening of its responsibilities to include the scrutiny of Orders laid under the Public Bodies Act 2011.

The Committee’s terms of reference are set out in full on the website but are, broadly, to scrutinise —

(a) every instrument (whether or not a statutory instrument), or draft of an instrument, which is laid before each House of Parliament and upon which proceedings may be, or might have been, taken in either House of Parliament under an Act of Parliament;

(b) every proposal which is in the form of a draft of such an instrument and is laid before each House of Parliament under an Act of Parliament,

with a view to determining whether or not the special attention of the House should be drawn to it on any of these specified grounds:

(a) that it is politically or legally important or gives rise to issues of public policy likely to be of interest to the House;

(b) that it may be inappropriate in view of changed circumstances since the enactment of the parent Act;

(c) that it may inappropriately implement European Union legislation;

(d) that it may imperfectly achieve its policy objectives;

(e) that the explanatory material laid in support provides insufficient information to gain a clear understanding about the instrument’s policy objective and intended implementation;

(f) that there appear to be inadequacies in the consultation process which relates to the instrument.

The Committee may also consider such other general matters relating to the effective scrutiny of secondary legislation as the Committee considers appropriate, except matters within the orders of reference of the Joint Committee on Statutory Instruments.

MembersBaroness Andrews Lord Hodgson of Astley Abbots Lord RowlandsLord Bowness Baroness Humphreys Baroness SternLord Goddard of Stockport Rt Hon. Lord Janvrin Rt Hon. Lord Trefgarne (Chairman)Lord Haskel Baroness O’Loan

Registered interestsInformation about interests of Committee Members can be found in the last Appendix to this report.

PublicationsThe Committee’s Reports are published on the internet at www.parliament.uk/seclegpublications

The National Archives publish statutory instruments with a plain English explanatory memorandum on the internet at http://www.legislation.gov.uk/uksi

Information and ContactsAny query about the Committee or its work, or opinions on any new item of secondary legislation, should be directed to the Clerk to the Secondary Legislation Scrutiny Committee, Legislation Office, House of Lords, London SW1A 0PW. The telephone number is 020 7219 8821 and the email address is hlseclegscrutiny@parliament.uk.

Thirtieth Report

INSTRUMENTS DRAWN TO THE SPECIAL ATTENTION OF

THE HOUSE

Non-Domestic Rating (Alteration of Lists and Appeals) (England) (Amendment) Regulations 2017 (SI 2017/155)

Date laid: 17 March 2017

Parliamentary procedure: negative

Valuation Tribunal for England (Council Tax and Rating Appeals) (Procedure) (Amendment) Regulations 2017 (SI 2017/156)

Date laid: 17 March 2017

Parliamentary procedure: negative

The Department for Communities and Local Government has laid these two sets of Regulations which, it says, serve the policy aim of delivering a more efficient business rates appeals system, based on reforms which introduce a three-stage system: Check, Challenge, Appeal. In August 2016 the Department set out the intention to lay these Regulations before Parliament “towards the end of 2016”. In the event, the instruments were laid on 17 March 2017, to come into force on 1 April 2017.

It is clear that many business ratepayers continue to have serious concerns about the nature of the reforms to the business rates appeals system made by these Regulations. We understand the sequence of events that preceded the laying of the Regulations, but we find it very regrettable that the Government have curtailed the opportunity for effective Parliamentary scrutiny in order to salvage their own timetable.

We draw these instruments to the special attention of the House on the ground that they give rise to issues of public policy likely to be of interest to the House.

1. The next revaluation of all properties for business, or non-domestic, rates takes effect from 1 April 2017. As the Department for Communities and Local Government (DCLG) explains in the Explanatory Memorandum (EM) to these Regulations, where a ratepayer disagrees with the rateable value shown in a business rating list, they may challenge the accuracy of the rateable value by proposing an alteration to the list to the Valuation Office (VO). If there is a disagreement between the ratepayer and the VO about the proposed alteration, the ratepayer can appeal to the Valuation Tribunal for England (VTE).

Business rates appeals—reforms

2. DCLG says that there is widespread agreement that the system for business rates appeals is in need of reform:

• too many rating appeals are made with little supporting evidence or evidence provided late in the process; and

• many appeals are made as a matter of routine, and do not result in either an appeal hearing or a change to the rating list.

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The Department states that businesses need to be confident that valuations are correct and, where this is not the case, it needs to be put right more quickly. The Government intend to deliver a more efficient business rates appeals system, based on reforms which introduce a three-stage system: Check, Challenge, Appeal. The reformed system is designed to manage the flow of cases through the system in a structured and transparent way which will allow ratepayers to make an informed decision about how to proceed. These two instruments serve these policy aims and will have effect in relation to non-domestic rating lists compiled on or after 1 April 2017.

Non-Domestic Rating (Alteration of Lists and Appeals) (England) (Amendment) Regulations 2017 (SI 2017/155)

3. SI 2017/155 amends the provisions about who may make a proposal (“Challenge”) and sets out details of the pre-proposal steps (the “Check” stage) which must be completed before a proposal may be made. It also places requirements on the parties to share evidence and arguments early in the process and provides for time limits at each stage, to keep cases moving forward, and “trigger points” at the Check and Challenge stages, so that the ratepayer can feel confident that they can progress the case even if no decision is made by the VO. The Regulations amend the procedure to:

• be followed after a proposal is made;

• provide for grounds for making an appeal to the VTE; and

• introduce fees for making an appeal.

Valuation Tribunal for England (Council Tax and Rating Appeals) (Procedure) (Amendment) Regulations 2017 (SI 2017/156)

4. SI 2017/156 prescribes the evidence and matters which are not to be taken into account by the VTE, in order to limit the introduction of new matters at Appeal stage and to reinforce the incentive for all parties to engage fully at the Check and Challenge stages. DCLG says that the changes will not rule out new evidence and arguments being brought forward, where the evidence was not known and could not reasonably have been acquired by the appellant at an earlier stage.

Consultation

5. Section 8 of the EM explains that a first consultation on proposals for a three-stage approach to resolving business rates appeals was carried out between 30 October 2015 and 4 January 2016. In July 2016 (six months after the consultation closed), the Government response was published.1 This stated that, while the overwhelming majority of the total of 214 responses received recognised the need for change, responses from businesses and rating agents were generally sceptical about the extent to which the proposals would achieve the aims of reform.

6. Between 16 August and 11 October 2016, DCLG carried out a follow-up consultation, seeking views on draft Regulations, and also on some specific further elements of the reform package that remained outstanding. In the August 2016 consultation document, DCLG stated that “the Government intends,

1 See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/535295/Reforming_business_rates_appeal_-_govt_response.pdf

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towards the end of 2016, to lay before Parliament regulations implementing the agreed approach. Subject to Parliamentary approval, the reformed system will come into force from 1 April 2017, to coincide with the national revaluation of rateable values”.2 In the EM, DCLG says that a total of 287 responses were received to the follow-up consultation. It notes that businesses and rating agent respondents remained concerned, in particular that changes would not provide sufficient transparency, and that there were unwelcome limitations on the introduction of new evidence after the submission of a proposal. The Government response to the consultation was published in March 2017 (five months after the consultation closed).3 On timing, it stated that “the Government’s intention is to implement the regulations as soon as possible”.

Timing

7. As noted above, in August 2016 DCLG set out the intention to lay these Regulations before Parliament “towards the end of 2016”. In the event, the instruments were laid on 17 March 2017, to come into force on 1 April 2017. In the EM, DCLG states:

“We regret to inform the Committee that in order to bring these Regulations into force in time for the implementation of the new appeals framework from 1 April 2017 it has become necessary to breach the 21 day rule. There has been a very high level of scrutiny of the business rates system over February and March, resulting mainly from significant concerns raised across the business sector in relation to the business rates revaluation coming into effect on 1 April. The Government announced some specific additional measures on business rates at the 8 March Budget, in part as a response to some of the concerns raised. In the context of the wider scrutiny of the business rates system, the Department considered it necessary to carefully consider the views and issues raised before finalising the Regulations”.

Comments from rating specialists

8. We received a joint submission of comments on the Regulations from three surveyors firms, and a firm of solicitors, all with specialist rating practices.4 The submission, which we are publishing on our website,5 makes a number of criticisms, and states that, “the current proposal as to grounds of appeal is unlawful and inadequately drafted.” and that, “the Minister has no legal power to abandon the principle that the rating list must be accurate”. The Earl of Lytton has told us that he wishes to be associated with the submission. We obtained a response to this submission from DCLG (also published on our website), in which the Department states in particular that, while the rating specialists’ submission “suggests that the policy is intended to distinguish between an accurate valuation and a reasonable valuation, such that a ratepayer would unfairly continue to pay rates based on a valuation that is inaccurate but considered reasonable … [t]he Government does not agree that this is the intent or effect of the policy”.

2 See para. 39 of document, at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/546100/Business_rates_appeals_reforms_consulation_draft_regs.pdf

3 See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/597609/CCA_Government_Response.pdf

4 The signatory firms are Gerald Eve LLP, GL Hearn, Daniel Watney LLP, and Berwin Leighton Paisner LLP.

5 See: http://www.parliament.uk/business/committees/committees-a-z/lords-select/secondary-legislation-scrutiny-committee/publications/

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9. We note in particular that, in their joint submission, the rating specialists say that, while the Regulations were still in draft, they wrote a letter to the Joint Committee on Statutory Instruments endorsed by 13 leading trade organisations,6 objecting to any clause which could prevent inaccurate assessments being corrected; and also that the Government have not made all responses to the consultation available and have refused Freedom of Information requests for their disclosure. In response, DCLG states that responses were initially withheld on the grounds of a Section 31 exemption (ongoing policy); and that this position is being reviewed following the finalisation of the policy approach and publication of the Government response to the consultation. In our view, now that the Regulations have been laid before Parliament, the Department should make all the consultation responses available.

Conclusions

10. It is clear that many business ratepayers continue to have serious concerns about the nature of the reforms to the business rates appeals system made by these Regulations, despite the consultation processes which the Department for Communities and Local Government has pursued over the last 18 months. The degree of controversy about these reforms may well explain why the Department was unable to lay the Regulations by the end of last year, as it undertook to do seven months ago, and indeed why it considered it necessary to allow only two weeks between the dates of laying and coming into force. We understand the sequence of events that preceded the laying of the Regulations, but we find it very regrettable that the Government have curtailed the opportunity for effective Parliamentary scrutiny in order to salvage their own timetable.

6 Including the Federation of Small Businesses, the Confederation of British Industry and the British Retail Consortium.

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Social Security (Restrictions on Amounts for Children and Qualifying Young Persons) Amendment Regulations 2017 (SI 2017/376)

Date laid: 15 March 2017

Parliamentary procedure: negative

Child Tax Credit (Amendment) Regulations 2017 (SI 2017/387)

Date laid: 15 March 2017

Parliamentary procedure: negative

Sections 13 and 14 of the Welfare Reform and Work Act 2016 restrict to two the number of children or qualifying young persons for whom the Child Element in Universal Credit and the individual Child Element of Child Tax Credit is payable. The new rules will apply to any children that join a family or are born after 6 April 2017. Four exceptions to this restriction were announced during the passage of the Bill and in the Summer Budget 2015. These two sets of Regulations set out how eligibility for those exceptions is to be assessed and also the arrangements for the transitional phase.

We have received over a hundred emails on this issue, which express particular concern about the effect of these changes on child poverty, the unequal effect of how similar families will be treated because of the order of their children and the types of decisions that families may make in order to have enough to live on. By far the most attention is devoted to questions on how the assessment of non-consensual conception will be handled sensitively.

We share the belief that guidance, or at least easily accessible information, should have been available sufficiently in advance so that benefit claimants contemplating a child to be born after 6 April 2017 were fully informed about the consequential effects.

The first three exceptions are straightforward and based on facts, the fourth relating to non-consensual conception is much more difficult to assess and the Department for Work and Pensions (DWP) does not yet appear to have made adequate arrangements for doing so. We note the financial and ethical concerns of both the local authorities and the charities which DWP expects to be conducting the third party assessments, and that it is unclear where the burden of proof will lie in such assessments. Particular issues relating to Northern Ireland will need to be resolved before equivalent regulations can be made. DWP’s responses to these questions are given in our Report but a number of the answers cast doubt on whether the system will be fully set up by 6 April when the legislation takes effect and on whether the exception relating to non-consensual conception can ever be made to work. We intend to write to the Minister to seek clarification on these points.

These Regulations are drawn to the special attention of the House on the ground that they may imperfectly achieve their policy objective.

11. The Social Security (Restrictions on Amounts for Children and Qualifying Young Persons) Amendment Regulations 2017 (SI 2017/376) (“the Social Security Regulations”) have been laid by the Department for Work and Pensions (DWP) principally under the Welfare Reform and Work Act 2016 and are accompanied by an Explanatory Memorandum (EM). The Child Tax Credit (Amendment) Regulations 2017 (SI 2017/387) were laid under

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the Tax Credits Act 2002 Act and also accompanied by an EM. We have received over a hundred emails on this issue, the eight key submissions are published on our webpage in full7 and the other 95 emails of support are summarised in the text below. Responses from DWP to the questions raised are incorporated into this Report.

Background

12. Sections 13 and 14 of the Welfare Reform and Work Act 2016 (the “2016 Act”) restrict to two the number of children or qualifying young persons for whom the Child Element in Universal Credit and the individual Child Element of Child Tax Credit is payable. The new rules will apply to any children that join a family or are born after 6 April 2017. Four exceptions to this restriction were announced during the passage of the Bill and in the Summer Budget 2015. These two sets of Regulations set out how eligibility for those exceptions is to be assessed and also the arrangements for the transitional phase.

The Social Security Regulations

13. The Social Security (Restrictions on Amounts for Children and Qualifying Young Persons) Amendment Regulations 2017, laid by DWP and relate to various social security benefits. The provisions of these Regulations have the following effects:

• Under amended regulation 24(b) the oldest two children under 16 are eligible for benefit when the household makes a claim, this may be extended up to age 19 where the child is in education or training (“qualifying young person”). After the oldest exceeds the age limit any third, younger sibling, would become entitled to the benefit, the sum would only reduce if there were no younger sibling.

• The current higher amount for the first child will be phased out.

• There will be no sudden cut-off at 6 April 2017—those currently receiving benefit for more than two children will continue to receive it until after the end of the interim period, 31 Oct 2018, or when a change of circumstances is declared (EM para 29).

• People with more than two children will not be able to make a new claim for Universal Credit between 6 April 2017 and 31 October 2018, they will be directed to an alternative benefit such as Child Tax Credits or Jobseeker’s Allowance. (This is an administrative issue to do with the roll-out of Universal Credit).

• Housing Benefit will be aligned with the two child limit. “The Regulations prescribe that the local authority will use the Child Tax Credit decision to base their decision on whether to include a third or subsequent child in the Housing Benefit applicable amount… For the case in which a person does not claim Child Tax Credit, the regulations provide for a default rule, which is that a maximum of two amounts for children will be included in the applicable amount”.

7 See: http://www.parliament.uk/business/committees/committees-a-z/lords-select/secondary-legislation-scrutiny-committee/publications/

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The Child Tax Credit Regulations

14. The Child Tax Credit (Amendment) Regulations 2017 have been laid by HM Revenue and Customs (HMRC) to prescribe exceptions to the new general rule that an award of Child Tax Credit (CTC) must not include the individual element of that tax credit in respect of third or subsequent children born on or after 6 April 2017. The individual element of CTC is £2,780 in the current tax year 2016–17 in respect of a child or qualifying young person who is not disabled.

Effect on Housing Benefit

15. Generally these new conditions will apply only to new claims or children born or adopted after 6 April 2017. However, in relation to the Housing Benefit element DWP states: “New claims to Housing Benefit on or after 6th April will be affected, but if the claimant’s child tax credit assessment includes more than two children/young people, then even in these cases, Housing Benefit will shadow what has happened in Child Tax Credit”.

16. Once the new Housing Benefit conditions do apply, if a claimant has six children all six will be considered in the calculation of the size of house needed but the claimant will only get two payments of “the HB applicable amount” for those children. DWP explained that:

“In Housing Benefit the “applicable amount” comprises a number of personal allowances in respect of the claimant (and partner if they have one), children, young people and premiums (the latter designed to recognise extra needs such as those relating to disabilities). Where a person’s income is below or equal to the applicable amount, or they are in receipt of another qualifying income-related benefit, they will normally receive maximum available Housing Benefit. Once a claimant’s income is above their applicable amount, Housing Benefit is gradually withdrawn at the rate of 65 pence in every £1 above the applicable amount.

… This means that the applicable amount for families with more than two children will be lower than it would have been were the reforms not to take place. Therefore, the tapering away of Housing Benefit entitlement might start at a lower level of income than it would have done were the reforms not to be made. However, there are a number of matters to bear in mind. As Child Tax Credit will be limited in a similar way, then there will also be less tax credit income to take into account in the Housing Benefit assessment. In turn, if HMRC allows more than two children in the Child Tax Credit assessment, then Housing Benefit will shadow that. Those claimants getting other income-related benefits such as Income Support, income-based Jobseeker’s Allowance, income-related Employment and Support Allowance or the guarantee element of Pension Credit will be unaffected, as entitlement to those benefits provide linked entitlement to full eligible Housing Benefit”.

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The Exceptions

17. The exceptions apply to both Regulations. Additional children may be taken into account for benefit or CTC purposes if they are:

• the result of a multiple birth;

• adopted;

• in kinship arrangements, that is, living long-term with friends or family; or

• born as a result of non-consensual conception or if the parent did not have the freedom or capacity to agree by choice. A condition is attached that the claimant must not be living at the same address as the other party to that intercourse.

18. Supplementary information from DWP clarified that the exception for adopted children does not apply to foster children as they are regarded as still under the care of the Local Authority. Also claimants will still be entitled to an additional amount in respect of any disabled children, regardless of the total number of children in the household.

19. It should also be noted that Child Benefit is separate, is not limited to a maximum of two children and will continue to be paid regardless of family size. DWP states: “Child Benefit is taken into account when dependants’ allowance is being paid, consequential changes are made in these Social Security Regulations to disregard Child Benefit when the disabled child premium, but not dependants allowance, is being paid, to avoid unfairness.”

Correspondence

20. There have been strong objections to way some of these exceptions are to be implemented: we have received eight substantive submissions and emails expressing a view from a further 95 individuals. The eight main submissions are from: the Association of Directors of Childrens’ Services and the Association of Directors of Adult Social Services (ADAS); the Child Poverty Action Group (CPAG); Gary Dunion; Engender—and two other Scottish charities dealing with women’s issues; Isabelle Kerr from Glasgow Rape Crisis Centre; the National Alliance of Women’s Organisations UK (NAWO); Alison Thewliss MP and; the Women’s Aid Federation Northern Ireland (“Women’s Aid”). They are all published on our website.8

21. These submissions express particular concern about the overall effect of these changes on child poverty and the unequal effect of how similar families will be treated under the exemptions because of the order of their children, and the types of decisions that families may make in order to have enough to live on. By far the most attention is devoted to questions on how the assessment of non-consensual conception will be handled sensitively.

22. Submissions from ADAS, Engender and Ms Kerr draw attention to the new demands that the Regulations will put on rape centres and local authority social services to act as a third party in providing evidence for the kinship and rape exceptions, and the lack of additional resources to provide for that work. They also, with Ms Thewliss, query whether sufficient training has been given to those required to arbitrate on the question of whether a child is the result of non-consensual sex.

8 See: http://www.parliament.uk/business/committees/committees-a-z/lords-select/secondary-legislation-scrutiny-committee/publications/

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23. Of the other 95 emails:

• 83 took issue with the Regulations forcing women to “prove” that they were raped and 17 were concerned with the way in which DWP aim to assess beyond reasonable doubt, using third party groups, whether a child was a result of rape.

• 28 correspondents argued that there would be a negative impact on families particularly through poverty or stigmatisation. 7 correspondents also claimed that these Regulations would particularly affect ethnic minority and refugee families with 2 arguing that it would actually cost more to implement these regulations.

• 6 correspondents argue that these Regulations break international conventions on human rights with 3 suggesting that this legislation is evidence of the Government controlling family size.

• 10 emails questioned why there had been no Impact Assessment or Equality Analysis with a further 4 correspondents claiming that the consultation period was not long or detailed enough and was held at an inappropriate time.

• 18 emails pointed out that these [negative] instruments would not be automatically debated and felt that such a significant change should fully be discussed in Parliament [and, therefore, should have been subject to the affirmative procedure].

Non-consensual conception

24. Paragraph 19 of the EM says eligibility for the non-consensual exception will normally be determined by using evidence from a third party. DWP explains that this will not be required where there has been a conviction for the criminal offence of rape or controlling or coercive behaviour in an intimate or family relationship, or a relevant criminal injuries compensation award.

25. We asked what would happen if someone claims the exception but has no evidence. DWP responded:

“DWP recognises that this is a very sensitive matter. The final decision on whether an exception applies will be made by DWP. Staff will not be asking for details of the incident but will instead refer the individual to an approved third party, such as a health care professional, a social worker or a specialist sexual or domestic violence charity. The process was deliberately designed in such a way that DWP staff would be excluded from making their own value judgements about the credibility of the claimant or as to the likelihood or otherwise of conception being non-consensual. The intention had been to be helpful to claimants and it was felt important that the test should not be placed so high as to limit it to a requirement that there had been a criminal conviction in cases of non-consensual conception. The list of third party professionals to whom the circumstances surrounding the non-consensual conception can be reported has been kept deliberately tight to ensure that they would be accustomed to dealing with the kinds of incidents and relationships likely to feature in many of the narratives”.

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This does not clarify where the burden of proof will lie and whether, if persuaded to accept a weak case, the assessor might be deemed party to benefit fraud.

26. We also asked what appeal process there is for someone who is denied a rape exception on the grounds that the third party did not believe them. DWP says that, because the decision regarding entitlement to the exception would be for DWP, the decision itself would be subject to the same appeal rights as other award decisions. We do not see how DWP could reconsider a case without asking intimate details of the applicant.

27. Several submissions also expressed concern about the condition that, to receive benefit on these grounds, the woman must not be living at the same address as the other party (reg 5(b)(ii)). Isabelle Kerr of the Rape Crisis Centre in Glasgow states that:

“We have more than 30 years of empirical evidence that tells us that the most dangerous time for a woman and her children is at the point of leaving an abuser. In the UK a woman is murdered every three days by a partner or ex-partner. Yet a woman would be forced to make that choice, perhaps knowing the level of danger she faces, in order to have enough money to feed and clothe her family”.

We share this concern.

Third party assessors

28. The ADAS submission estimates that 200,000 to 300,000 children are being brought up under informal kinship care arrangements, states that many of these families will not have previously been involved with social services and that those claiming benefits will now need third party evidence thus increasing the workload on social workers. Local authorities will have to carry out additional functions to confirm kinship care arrangements or that conception was non-consensual but no additional funding has been allocated under the New Burdens arrangement. DWP responded that:

“the exception will only apply to third or subsequent children in the household claiming Universal Credit or Child Tax Credit, and as such, we expect the numbers of children in informal caring arrangements who will be affected to be very low, particularly initially when it will only apply to new births—all children born before 6 April 2017 will receive Child Tax Credit without needing to claim an exception. Nevertheless, HMRC are currently undertaking a new burdens assessment in order to ensure that Local Authorities receive any additional funding required”.

This will reassure ADAS but it is concerning that they had not already been made aware that this assessment is taking place.

29. The CPAG submission drew attention to evidence that police officers under-report allegations of rape as crimes, indicating that they do not believe the complainant. This would make them unsuited to be used as assessors. DWP responded that police officers will not appear on the list of approved third parties: that list has been compiled through discussions with a broad range of stakeholders and will include health professionals, social workers and specialist sexual and domestic violence charities. We note however that the NAWO submission states that some “professional bodies and agencies that

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appeared to be proposed by the DWP as ‘third party assessors’ have yet to hear from the UK Government on this”.

30. We also asked what the arrangements will be for third party assessors in Scotland where the main voluntary groups do not wish to endorse a system that they object to. The DWP states it is for voluntary organisations to decide to become a listed third party and that the Department is continuing to discuss implementation with third parties. This seems to be leaving matters unresolved rather close to the date on which the Regulations come into effect and takes no account of the training that may be necessary for the assessors eventually chosen.

Other questions from the submissions

31. We asked DWP for responses to a number of questions included in the submissions:

32. What about “accidents”? All contraception has a failure rate even when used correctly. What about the not infrequent event of the surprise third child to a mature couple? DWP responded: “The regulations have introduced exceptions to the child element restriction that were considered fair and which provided applicants with evidence requirements that can be reasonably met”.

33. Should there not be a transitional period for children conceived before the Regulations were laid but who will be born after 6 April 2017? DWP responded: “The policy was announced in the Summer Budget 2015 and brought into statute in the Welfare Reform and Work Act 2016. In implementing the policy from 6 April 2017, the Government has given people sufficient notice to be able to plan for the changes”. This appears to us an unrealistic expectation: the average person does not follow politics that closely and therefore, clear messages should have appeared on the Universal Credit website, and on material given to current claimants.

34. Some felt the legislation unfair in the way it addresses the order of children.

• A couple who take on kinship care of (typically) younger siblings before having a child of their own will not receive benefit for that child. The Regulations only permit an exception for a third child who is adopted, not for a third child in a family that has adopted.

• There is a similar inconsistency with a child as a result of rape: if a women has a child as a result of rape and subsequently marries she will only be able to obtain benefit for one child of that marriage, that is two in total. If, conversely, she has two children and is then raped she would be able to claim for a total of three children.

DWP responded:

“It is correct that the exceptions only apply to the third or subsequent child or qualifying young person in the household as determined by the ordering rules. In the scenario where a household is already caring for two children before having a third of their own, the child element would only be paid for that new child if an exception applied. In the scenarios described, the claimant would have the choice to have a child of their own. The new rules mean that households will need to think carefully about whether they are financially prepared to support a new child without relying on Universal Credit”.

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Privacy issues

35. There are privacy issues: if someone receives money for a third child it will become obvious to family members and certain authorities that she has been raped at some point thus reviving the trauma. DWP stated:

“We have been thorough in taking data protection issues into account and the Departments’ lawyers are satisfied that the process does not breach the Data Protection Act. Award notices will not state the reason for the exception. We do accept that an inference may be drawn as to the reason for an exception being in place, this risk is unavoidable, given the limited range of exceptions in place but we believe that this risk is outweighed by the financial benefit to the claimant in being granted the exception”.

36. Women’s Aid point out that in Northern Ireland, private declarations of rape or coercion to a third party assessor will be contrary to the law. In Northern Ireland it is a criminal offence subject to a prison sentence for an organisation or support service to fail to declare a crime to the police if they become aware of it. This will put both the applicant and the assessor in an invidious position. The practicalities of applying these requirements in Northern Ireland will need to be fully thought through before the equivalent regulations are brought forward.

Child poverty

37. Some were concerned women will be forced into abortion because of economic factors. They also noted the difficult position of women with a religious conviction against abortion or those in Northern Ireland unable to obtain it. DWP stated that it had been in touch with the Department for Communities in Northern Ireland and various religious organisations about those issues. “The Government does not have a policy on how many children a family should have and it is important to emphasise that Child Benefit is available regardless of the number of children in the family”.

38. Citing that 34% of children in poverty in 2014–15 were in families of three or more children, many felt that these Regulations will act against the Government’s wider policy on reducing child poverty. DWP responded:

“The Prime Minister has set out clearly that she is committed to building a country that works for everyone—not just the privileged few. Tackling child poverty and disadvantage is a priority for this Government. To do this, we need to focus on the root causes of poverty and disadvantage. This is why we have introduced two statutory measures of parental worklessness and children’s educational attainment—to drive action on the two areas that can make the biggest difference to children’s outcomes. We will make a number of announcements in the coming weeks. Work is the best route out of poverty and our welfare reforms make sure that work always pays, providing opportunity for all those who can work and a safety net for those who can’t work. There will be no cash losers as a direct result of this policy and Child Benefit will also continue to be paid regardless of family size, as the basis of the Government’s contribution towards the cost of bringing up a child”.

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Equality?

39. Several felt these changes contravene the UK’s obligations under the European Convention on Human Rights (ECHR), on women’s rights to reproduce and under the Convention on the Elimination of all forms of Discrimination Against Women (CEDAW). DWP stated that its position is that this policy is compliant with the Government’s obligations under both ECHR and CEDAW.

“As it relates solely to benefit entitlement, it does not interfere with any person’s rights to reproduce. The restriction on entitlement to support for children was implemented through primary legislation and therefore its impacts were considered fully by Parliament. Any purported interference with other human rights is proportionate and justified by the legitimate aims of the policy. The exceptions to the restriction introduced by these regulations further reduce the impact of the policy in particular circumstances”.

40. Since these changes seem most likely to impact on women, several correspondents asked why is there no Equality Assessment to show the comparative impact on different social groups. DWP responded:

“The Government has assessed the impact on equality of the policies introduced by the Summer Budget 2015 and the Welfare Reform and Work Act 2016, thus meeting its obligations in the Public Sector Equality Duty. The Government set out its assessment of that impact when the Bill was introduced to Parliament in July 2015.9 It also took account of that duty during the formulation of the policy on the exceptions. All families, regardless of their background and beliefs, need to think carefully and ensure that they can afford to provide for a new child in their household. It is fair that families on benefits have to make the same financial decisions as those families supporting themselves solely through work”.

We accept the point that the requirement to consider their means before deciding to have another child will apply to all families on benefits but this does not allow for cultural or religious views which do not allow for contraception. Nor are we convinced on the equality point, as we do not foresee any men being subject to distressing interviews in order to obtain benefits.

Financial Impact

41. The Committee queried the statement in the EM about how the impact on the public sector is estimated to be an increase of £170 million in payments when the effect of the Regulations is to restrict the numbers to which these benefits will be paid. DWP explained that the restriction was given effect by the Welfare Reform and Work Act 2016 and the savings were calculated for that Act. These Regulations introduce exceptions, transitional arrangements and savings with regards to the restriction, the effect of which is to reduce the savings anticipated by the restriction in the Act.

9 http://www.parliament.uk/documents/impact-assessments/IA15-006E.pdf.

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Guidance

42. Several submissions mentioned that there is currently no information about the changes to Universal Credit on the Gov.uk website and questioned how staff and advisory bodies such as Citizens Advice were to be trained, given that the guidance is not available two weeks in advance of the date the legislation takes effect. DWP stated that:

“High level messaging was placed on Gov.uk at the time the policy was announced with further detail published as part of the consultation in October 2016 and the response to the consultation in January 2017. In addition we have had ongoing discussions regarding the policy with stakeholders as part of our regular meetings. The changes are being communicated to operational staff through implementation updates, learning and development products, and updates to operational guidance in advance of the implementation date. In line with the date the policy comes into effect we will, on 6 April, publish detailed UC claimant guidance regarding the policy along with detailed guidance for stakeholders”.

43. We have raised this same issue with DWP recently: where operational guidance informs decisions about a person’s benefit, it should be available at the time the Regulations are before Parliament for scrutiny. Even more importantly such guidance, or at least easily accessible information, should have been available sufficiently in advance so that benefit claimants contemplating a child to be born after 6 April 2017 were fully informed about the consequential effects.

Consultation

44. The consultation period was short for both Regulations. The EM for the Child Tax Credits as originally laid provided only perfunctory information about the consultation carried out prior to the laying of the Regulations and we have asked HMRC to revise it. We also asked DWP why the consultation period on such a contentious matter was limited to one month. DWP stated that they considered the period to be sufficient, given earlier informal engagement with a wide range of stakeholders, including charities, Government departments, and groups involved in supporting victims of rape. We note that they have provided a detailed summary of the responses that they received and how they have amended the proposals as a result. Following our inquiry into consultation practice we gave the view that six weeks should be the minimum for a public consultation exercise. The extent of the correspondence that we have received suggests that the public feel that they have not had a sufficient opportunity to comment on this controversial subject.

Conclusion

45. The first three exceptions are straightforward and based on facts, the fourth relating to non-consensual conception is much more difficult to assess and DWP do not yet appear to have made adequate arrangements for doing so. We note the financial and ethical concerns of both the local authorities and the charities which DWP expect to be conducting the third party assessments, and that it is unclear where the burden of proof will lie in such assessments. The particular issues relating to Northern Ireland will need to be resolved before equivalent regulations can be brought forward. DWP’s responses to

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these questions are given in our Report but a number of the answers cast doubt as to whether the system will be fully set up by 6 April when the legislation takes effect and on whether the exception relating to non-consensual conception can ever be made to work. We intend to write to the Minister to seek clarification on these points.

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INSTRUMENTS OF INTEREST

Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of Japan concerning Reciprocal Provision of Supplies and Services between the Armed Forces of the United Kingdom of Great Britain and Northern Ireland and the Self-Defense Forces of Japan (Cm 9442)

46. The Government have a number of Mutual Logistic Support Arrangements (MLSA) with other states, which support the Ministry of Defence’s objective of improving logistic support to the UK Armed Forces overseas, including supplies, ease of access and over-flight. This Agreement establishes such an arrangement with Japan. Reciprocal arrangements allow the UK to provide the supplies and services to the Self-Defense Forces of Japan necessary for exercises and training, United Nations Peacekeeping Operations, internationally coordinated peace and security operations and humanitarian relief, including operations to cope with large-scale disasters in the territory of either Party or a third country.

Statement of Changes in Immigration Rules (HC 1078)

47. These changes include a new requirement that individuals applying for entry clearance under the Tier 2 General route, to work in the education, health and social care sectors, must provide a criminal record certificate from any country in which they have lived for 12 months or more in the previous ten years. This requirement will also apply to the partners of Tier 2 migrants. The Home Office states that this requirement already applies to Tier 1 applicants and their adult dependents and is part of a phased implementation. Following a review by the Migration Advisory Committee the salary threshold for experienced workers in Tier 2 is being increased to £30,000 for new applicants. This earnings provision does not apply to professions on the shortage list such as nurses, paramedics and maths teachers. Other provisions amend Tiers 4 and 5 and the reentry ban which is applied to overstayers.

Universal Credit (Reduction of the Earnings Taper Rate) Amendment Regulations 2017 (SI 2017/348)

48. These Regulations apply the change to the Earnings Taper rate announced in the Chancellor’s Autumn Statement of November 2016. From 10 April 2017 the rate is to be reduced from 65% to 63% meaning that for every additional £1 earned, a claimant receiving Universal Credit will retain 37p, that is, 2p more than at present. This means that anyone claiming Universal Credit earning less than £26,000 will be better off, and a further 90,000 households, whose income would previously been too high to claim, might now become eligible.

Childcare (Miscellaneous Amendments) Regulations 2017 (SI 2017/361)

49. The Department for Education (DfE) has laid these Regulations with an Explanatory Memorandum (EM) and Impact Assessment. DfE explains that the Regulations introduce an updated Early Years Foundation Stage (EYFS) statutory framework (“the Document”), which sets the standards that all early years providers must meet to ensure that children learn and develop well and are kept healthy and safe.

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50. Among the changes made is a new requirement in respect of Paediatric First Aid (PFA) qualifications: from 1 April 2017, all new entrants to the early years workforce with full and relevant level 2 or level 3 qualifications must also have either a full PFA or an emergency PFA certificate before they can be included in the required staff to child ratios in an early years setting. Newly qualified entrants who started work between 30 June 2016 and 2 April 2017 must have either a full PFA or an emergency PFA certificate by 2 July 2017. The current legal requirement in the Document is that at least one person who has a current PFA certificate must be on the premises at all times. DfE says that the aim is to embed PFA training into the qualification requirements for new entrants to the early years workforce and over time significantly increase the number of staff trained in PFA.

51. DfE refers to consultation which it carried out between 15 October and 10 December 2015. In the consultation document,10 DfE stated: “Following the tragic death in 2012 of Millie Thompson in a nursery class, the coroner for the case wrote to the Secretary of State stating that all nursery staff should have PFA training. The Government wants to take account of the coroner’s report …”. There were 377 consultation responses. 91% of respondents thought that the PFA requirements should be changed or strengthened; and 84% said that the Government should introduce a mandatory requirement for newly qualified early years staff, as these Regulations do. A summary of responses has been published.11

Riot Compensation Regulations 2017 (SI 2017/371)

52. The Riot Compensation Act 2016 (“the 2016 Act”) repeals and replaces the Riot (Damages) Act 1886 which was found to be cumbersome and ill-suited to modern circumstances when it was last used in 2011. These Regulations set out the procedure and basis for making claims under the 2016 Act, for the handling of claims and for decision-making by the claims authorities. The 2016 Act limits any claim to a maximum of £1 million and regulation 16 sets out circumstances in which an award may be reduced (along the lines of contributory negligence). The 2016 Act provides for temporary accommodation to be paid for, where someone’s home has been left uninhabitable by a riot, but regulation 15 limits this provision to 132 days. Following consultation the Regulations also amend section 2(3) of the Act to allow riot compensation claims to be made for business contents in qualifying motor vehicles and their trailers and other attachable devices. Although these Regulations come into force on 6 April 2017, they cannot be used until needed. Separate Regulations will be prepared to provide for the creation of a riot claims bureau under section 6 of the 2016 Act and held in readiness to be laid before Parliament in the event of widespread riots.

10 See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/468408/Paediatric_first_aid_amendments_-_consultation.pdf

11 See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/532503/PFA_Consultation_findings_and_response.PDF

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INSTRUMENTS NOT DRAWN TO THE SPECIAL ATTENTION OF

THE HOUSE

Draft instruments subject to affirmative approval

Combined Authorities (Finance) Order 2017

Domestic Renewable Heat Incentive Scheme (Amendment) Regulations 2017

Government Resources and Accounts Act 2000 (Audit of Public Bodies) Order 2017

Immigration Act 2016 (Consequential Amendments) (Biometrics and Legal Aid) Regulations 2017

International Headquarters and Defence Organisations (Designation and Privileges) Order 2017

Misuse of Drugs Act 1971 (Amendment) Order 2017

Renewable Heat Incentive Scheme Regulations 2017

Instruments subject to annulment

Cm 9442 Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of Japan concerning Reciprocal Provision of Supplies and Services between the Armed Forces of the United Kingdom of Great Britain and Northern Ireland and the Self-Defense Forces of Japan

HC 1078 Statement of Changes in Immigration Rules

SI 2017/279 Harbour Directions (Designation of Harbour Authorities) Order 2017

SI 2017/287 Social Security Revaluation of Earnings Factors Order 2017

SI 2017/294 Road Traffic Offenders (Additional Offences) Order 2017

SI 2017/324 Pension Protection Fund (Modification) (Amendment) Regulations 2017

SI 2017/325 Freight Containers (Safety Convention) Regulations 2017

SI 2017/329 Social Security (Scottish Infected Blood Support Scheme) Regulations 2017

SI 2017/342 Equality Act 2010 (Taxis and Private Hire Vehicles) (Passengers in Wheelchairs–Notices of Exemption) Regulations 2017

SI 2017/348 Universal Credit (Reduction of the Earnings Taper Rate) Amendment Regulations 2017

SI 2017/349 Social Security Benefits Up-rating Regulations 2017

SI 2017/354 Occupational Pension Schemes and Social Security (Schemes that were Contracted-out and Graduated Retirement Benefit) (Miscellaneous Amendments) Regulations 2017

SI 2017/361 Childcare (Miscellaneous Amendments) Regulations 2017

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SI 2017/365 Planning (Hazardous Substances) (Amendment) Regulations 2017

SI 2017/366 Insolvency (England and Wales) (Amendment) Rules 2017

SI 2017/367 Rent Repayment Orders and Financial Penalties (Amounts Recovered) (England) Regulations 2017

SI 2017/368 Energy Performance of Buildings (England and Wales) (Amendment) Regulations 2017

SI 2017/369 Insolvency (England and Wales) Rules 2016 (Consequential Amendments and Savings) Rules 2017

SI 2017/371 Riot Compensation Regulations 2017

SI 2017/373 Social Security (Miscellaneous Amendments No. 2) Regulations 2017

SI 2017/375 State Pension Debits and Credits (Revaluation) Order 2017

SI 2017/378 Housing and Planning Act 2016 (Consequential Provisions) (England) Regulations 2017

SI 2017/386 Social Security (Invalid Care Allowance) (Amendment) Regulations 2017

SI 2017/389 Judgments Enforcement (Northern Ireland) (Amendment) Order 2017

SI 2017/390 Road Traffic Act 1988 (Motor Racing) (England) Regulations 2017

SI 2017/391 Town and Country Planning (General Permitted Development) (England) (Amendment) Order 2017

SI 2017/392 Town and Country Planning (Compensation) (England) (Amendment) Regulations 2017

SI 2017/396 Tax Credits (Definition and Calculation of Income) (Amendment) Regulations 2017

SI 2017/401 Deregulation Act 2015 (Birmingham City Council Act 1985) (Repeal) Regulations 2017

SI 2017/404 Pollution Prevention and Control (Fees) (Miscellaneous Amendments) Regulations 2017

SI 2017/407 Water Environment (Water Framework Directive) (England and Wales) Regulations 2017

SI 2017/408 National Health Service (Charges for Drugs and Appliances and Dental Charges) (Amendment) Regulations 2017

SI 2017/409 Tobacco Products and Herbal Products for Smoking (Fees) Regulations 2017

SI 2017/411 Licensing Act 2003 (Miscellaneous Amendments) Regulations 2017

SI 2017/412 Guardian’s Allowance Up-rating Regulations 2017

SI 2017/413 Family Procedure (Amendment) Rules 2017

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SI 2017/416 Social Security (Contributions) (Re-rating) Consequential Amendment Regulations 2017

SI 2017/417 Pensions Increase (Review) Order 2017

SI 2017/418 Pensions Increase (Modification) Regulations 2017

SI 2017/422 Pensions Act 2014 (Consequential, Supplementary and Incidental Amendments) Order 2017

SI 2017/426 Oil and Gas Authority (Fees and Petroleum Licensing) (Amendment) Regulations 2017

SR 2017/50 Employment and Support Allowance (Exempt Work & Hardship Amounts) (Amendment) Regulations (Northern Ireland) 2017

SR 2017/51 Employment and Support Allowance (Consequential Amendments and Transitional and Savings Provisions) Regulations (Northern Ireland) 2017

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APPENDIx 1: INTERESTS AND ATTENDANCE

Committee Members’ registered interests may be examined in the online Register of Lords’ Interests at www.publications.parliament.uk/pa/ld/ldreg.htm. The Register may also be inspected in the Parliamentary Archives.

For the business taken at the meeting on 28 March 2017, a Member declared the following interest:

Road Traffic Act 1988 (Motor Racing) (England) Regulations 2017 (SI 2017/390)

Lord TrefgarneTrustee Emeritus of Brooklands Museum.

Attendance:

The meeting was attended by Baroness Andrews, Lord Bowness, Lord Goddard of Stockport, Lord Haskel, Baroness Humphreys, Lord Janvrin, Baroness O’Loan, Lord Rowlands, Baroness Stern and Lord Trefgarne.