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Z2K suggested amendments to the Welfare Reform Bill

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   HOUSE OF LORDS
   DRAFT AMENDMENTS FOR THE

   WELFARE REFORM BILL;
   AND THE CASES FOR THEM


   Introduction:
1. The Z2K Trust has given practical, legal and emotional support to impoverished and
   vulnerable debtors struggling with complex welfare since the mid 1990s. We sign-post
   mortgage and credit card debts to money advisers in order to focus on cases below the
   radar. We were founded in 1995, registered as a Charity in 1997, worked as volunteers for
   ten years servicing a contract with Wycombe Magistrates Court to help fine defaulters fill in
   their means statements. We have grown rapidly since 1997 by raising funds to employ three
   full time lawyers who support a growing number of volunteers, currently 32, servicing a
   growing number of cases, currently around 90 at any one time; the cases are time heavy. We
   also train and provide legal advice to other NGOs. We have three legally qualified
   professionals employed fulltime, a parliamentary researcher and an administrator.
2. We are concerned about the increasing powers in the Bill of decision making officials in
   jobcentres to enforce overpayments (debts) and impose and enforce sanctions and penalties
   (fines) with few of the safeguards for the innocent and vulnerable that have existed for years
   in the county and magistrates courts. The suggestion from the Prime Minister and from the
   Secretary of State for Work and Pensions that jobcentres and local authority housing offices
   should be stopping benefits of rioters would be a further shift away from the administration
   of justice by the courts.
   Punitive Welfare
3. Provisions in the Welfare Reform Bill have carried the application of the economic theory of
   moral hazard to extremes and rely on exaggerated claims of welfare dependency.
   Unemployment benefits, already kept low to discourage people from idling on the dole, are
   being reduced by debts to an amount incapable of keeping body and soul together -see
   APPENDIX i. Overemphasis on the moral hazards when unemployment benefits are too high
   has blinded governments to the moral hazards when they are far too low.
   The Universal Credit
4. The new Universal Credit will be made up of a
        a.   a standard allowance (SA) ,
        b.   an amount for children,
        c.   another for housing and
        d.   one more for particular needs or circumstances.
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5. The Bill does not attempt to explain how the level of the SA will be decided. There is no link
   to the escalating prices of food, other essential needs in the shops or to the utilities. The
   Centre for Research is Social Policy has calculated that sometime in the next ten years the
   weekly cost of a healthy diet is likely to overtake weekly amount paid in by the Standard
   Amount which, ministers have announced will be £67.70, the current level of the adult
   unemployment benefit, uprated by the less generous CPI.
6. The caps on housing benefit and the local housing allowance will leave amounts of rent
   unpaid so creating debts which will have to be paid out of the money needed for a healthy
   diet. Official and claimant errors have already created debts, other than £1billion fraud,
   owed to the DWP, HMRC and the Local Authorities totaling £2 billion in 2010.
7. The Bill insists on enforcing them against poverty incomes disregarding all the evidence from
   the Government Office for Science, The Royal College of Psychiatrists and Mind about the
   relationship between mental health problems and debt. The housing benefit caps and the
   Bill are creating debts for the poorest citizens ignoring the research of the Royal College of
   Psychiatrists which shows that 50% of people in debt have a mental health problem and 25%
   of people with a diagnosed mental health condition are in debt.
8. In summary Poverty in the UK is public health issue.
         a. the HB caps , and other welfare cuts , will seriously increase poverty and debt
            among the poorest citizens,
         b. debt and mental illness have been found to be related by the Government Office
            for science, the Royal College of Psychiatrists and Mind, and other researches.
         c. the effects of debt are even worse when incomes are below the government’s
            poverty threshold and all independent measures – sometimes far below,
         d. it leads to despair, even suicide, when associated with bailiffs, threats of eviction
            and actual eviction
         e. debt is debilitating and renders people unfit for work when accompanied with
            draconian enforcement, we have cases.
         f. Debt and poverty reduce the nutrition of already impoverished women of child
            bearing age and before and during pregnancy and therefore put the mental and
            physical health of their offspring at risk.
         g. mental illness , exacerbated by debts which are enforced against inadequate
            incomes, costs the tax payer billions in poverty related ill health and educational
            underachievement which the Treasury never estimates.
 9. The Centre for Mental Health reported in 2010 that that the total cost of mental ill health
    in England was £105.2 billion a year, including £21.3 billion in health and social care costs,
    £30.3 billion in lost economic output and £53.6 billion in human suffering.
 10. The Institute of Brain Chemistry of Human Nutrition has reported that low birth weight,
     when associated with fetal growth restriction, is the strongest predictor of poor learning
     ability, school performance, behavioural disorders and crime.
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11. Suggested amendment A.
     Clause 8. Calculation of Awards.
     Insert (5)
     The maximum amount to be awarded in each component part of the Universal Credit in
     Clause 1 (3) (a), (b), (c) and (d) shall be decided annually after consideration of
     independently researched minimum income standards both before and after the payment
     of housing costs and council tax.
     Brief
  12. Appendix ii shows a list of 70 NGOs supporting the Z2K petition calling for government to
      research minimum income standards before setting the level of statutory minimum
      incomes.
  13. The Universal Credit is a disappointment. The claims that it is simpler than the current
      system do not stand up. It would have been better to make one government department
      responsible for all welfare and one local agency in each town responsible for all delivery
      and complaints; the move to increase disregards and improve the tapers is welcome but it
      could have been done without trying to squeeze all benefits into one; and then failing by
      leaving the council tax out.
  14. NGOs are unable to assess the impact of a council tax administered by local authorities,
      which it is suggested will be capped, until the CLG produce the details. At the moment we
      are faced with the possibility that the Bill will complete its passage through parliament
      before they are produced.
  15. It is claimed the Universal Credit will be simpler but in many ways the complexity remains.
         a. the claimants, and the advice sector, have to deal with the magistrates courts, the
            local authority council tax department and the bailiffs when dealing with council tax
            arrears and overpayments. That will not change.
         b. The claimants, and the advice sector, now have to deal the Housing Benefit
            department and the overpayments of the local authority, the separate housing
            department if they are council tenants, the RSL or private landlords and the County
            Courts and then the bailiffs, when they have rent arrears.
         c. We are concerned that it will be worse without knowing how the DWP,
            inexperienced in housing matters, will deal with the housing benefit as part of the
            UC. Enforcement of rent arrears will, we assume remain, with the county courts.
         d. The amount for children and the amount for special circumstances, such as
            disability, will be calculated under two different sets of regulations both of which
            will be open to challenge and appeal to the tribunals; again no change.
         e. It will all be liable to overpayments which are the errors of officials or of the
            claimants. An addition to the existing procedures is the decision of the DWP to deal
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             centrally with the appeals against the enforcement of overpayments; that will add
             complexity.
16. The standard amount of the UC will be £67.50 described as the “building block” by the
    Minister for Employment.
             “Hansard, 31st March; Welfare Reform Bill Committee. For the time
             being, however, and certainly for the foreseeable future, we have
             formed the view that the CPI will be the basis on which we uprate
             benefits. In the standard adult rate of JSA and ESA, the basic
             component will be approximately £67.50 a week. That is the building
             block that we intend to use for the universal credit. In two years’ time,
             once the universal credit has been established, that amount will be
             different, because it will have been uprated.”
     17. The building block will not be able to accommodate the rent or council tax arrears
         arising as a result of the Local Housing Allowance, Council Tax and the Housing benefit
         caps so they may have to be paid by either the children’s amounts or the disability
         amounts.
     18. Suggested Amendment B.
     Clause 8 Calculation of awards
     Insert (6)
     The Secretary of State will commission independent research into the minimum incomes
     needed for the healthy living by women of child bearing age both before they conceive and
     while they are pregnant and will annually update the results of that research.
     Brief
     19. This amendment will be the first opportunity Peers have had to debate the cuts in
         financial support for pregnant women in the Health in Pregnancy Grant and Savings
         Accounts Act 2010.It was declared a money bill by the Speaker after it had completed
         its passage through the House of Commons..
     20. The following letter was published by The Guardian on the 2 nd July 2011.
         The passion of the secretary of state for work and pensions (Two babies, one
         future, 2 July) for early intervention to increase the chances of a disadvantaged
         child moving out of poverty brings horses bolting and open stable doors to
         mind. For too many children disadvantage starts with a mother who cannot
         afford a healthy diet and might not know enough about the food she needs to
         give birth to a healthy baby. International research, headed by the Institute of
         Brain Chemistry and Human Nutrition, has shown that poor
         maternal nutrition leads to poor cognitive ability, developmental brain disorder
         and a higher risk of cerebral palsy.
         The last government took the point and added the health in pregnancy grant,
         the baby entitlement of the child tax credit, the toddler entitlement of the child
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         tax credit and the child trust fund, but it too should have started before women
         conceive by increasing their unemployment benefit of £53.45 a week.
         The present government abolished all these benefits, so reducing the income
         during pregnancy and the first year of a baby's life by £1,735, as calculated by
         Family Action.
         An unemployed woman aged 18-25, before and during pregnancy, has an
         income of just £53.45 a week. This will be more vulnerable to rent arrears from
         housing benefit caps, still vulnerable to unregulated loan sharks, and is likely to
         be overtaken by the escalating weekly cost of a healthy diet and domestic fuel,
         with the annual uprating now pegged to the RPI. The public health white paper
         only mentions food when abolishing the Food Standards Agency and never
         mentions debt, another source of mental illness.
         Rev Paul Nicolson
         Chair, Zacchaeus 2000 Trust
21. Donald Hirsch of the Centre for Research in Social Policy has calculated that sometime within
    the next ten years the increase in the weekly cost of a healthy diet will overtake the annual
    increase in the unemployment income of the under 25s. He calculates that in 2020 the
    weekly cost of a healthy diet will be £77 a week when the JSA for the under 25s will be £74 a
    week. The fuel costs will be £24 a week; the combined costs of food and fuel will be £101
    when the JSA for over 25s will be £93 a week. (An Unpublished Letter to the Z2K Trust).
22. Joseph Rowntree reported on the 5th July 2011 that inflation raised minimum household
    budget costs by around 5 per cent in the year to April 2011, slightly faster than main
    Government inflation measure, the Consumer Prices Index (CPI). Over the past decade, the
    cost of a ‘minimum’ basket of goods and services has risen by 43 per cent, compared with 27
    per cent for CPI.
23. The Institute of Brain Chemistry and Human Nutrition has shown that fish, and oily fish in
    particular, are essential in the diet of women before they conceive and while they are
    pregnant to help prevent the development of poor cognitive ability and serious brain
    disorders, such as cerebral palsy, in their babies, which are associated with poor maternal
    nutrition and with consequent low birth weight.
24. Marmot emphasised the need for attention to healthy diets both before and during
    pregnancy and recommended the introduction of minimum income standards. Food and fuel
    poverty severely impact on the children born of malnourished mothers.
25. Sam Royston of Family Action has shown that an unemployed woman receiving £51.85 aged
    18-25 and £65.45 a week aged 26-60 JSA/ESA will l £1735 during pregnancy and in the first
    year of a child’s life, because the government has cancelled her entitlements to the Health in
    Pregnancy Grant, the Baby Entitlement of the Child Tax Credit, the Toddler Entitlement of
    the Child Tax Credits and the Child Trust fund. These cuts are unlikely to be offset by the
    above inflation increases of the child element in the child tax credit. They are more likely to
    be compounded by the housing benefit caps, the local housing allowance and the 10% cap
    on housing benefit after people have been unemployed and receiving JSA for one year, all of
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   which will increase debts. They will increase fuel and food poverty at a time when healthy
   maternal nutrition and warmth during pregnancy are essential to the birth of healthy babies.
   Departmental Ping-Pong.
26. Lord Knight will remember that he passed my concerns about the health consequences for
    the babies of women receiving the dire poverty income of adult unemployment benefits
    before they conceive and while they are pregnant from the DWP to the Department of
    Health, who passed it to the Scientific Advisory Committee for Nutrition, who had never
    considered anything to do with economics, and who were then abolished, with the Food
    Standards Agency, by the coalition.
27. This crucial issue is treated to “Ping-Pong” between the DWP and the DoH. We asked the
    DoH a Freedom of Information question about the effect on the health of babies of the cuts.
    They replied;
   Thank you for your email of 19 August to the Department of Health about the Sure Start
   Maternity Grant. I have been asked to reply. I regret this is not within the Department of
   Health’s remit. After considering your email, I would recommend that you forward your
   correspondence to colleagues in the Department for Work and Pensions where the staff
   are better able to answer your query. The contact details are……..
28. Steve Webb MP, now a Minister at the DWP told the Child Poverty Bill committee in
    November 2009. ,
         When we heard evidence (from Z2K), it was pointed out that a young woman under 25
         is allocated £50.95 a week [Now £53.45 —Z2K] to live on, but evidence suggests that
         £43.00 (April 2008 then £44.34 April 2009 and then £45.65 April 2010) a week is
         needed for food for a decent, healthy living standard. Fuel and other bills cannot be
         paid from the remaining £7-odd, so young women in that age group who are on benefit
         are, by definition, eating less than is healthy for them. If they then become pregnant,
         they will at that time have been eating unhealthily. Budget standards and minimum
         income standards would enable us to consider what such young women need for a
         decent standard of living, and to make that the benchmark. Fiscal considerations would
         determine whether we hit the benchmark, but not knowing what the benchmark is
         unacceptable and inexcusable." Hansard clmn 363 3 November 2009.
29. Joseph Rowntree Foundation has reported that inflation raised minimum household budget
    costs by around 5 per cent in the year from April 2010 to April 2011, slightly faster than main
    Government inflation measure, the Consumer Prices Index (CPI); and that over the past
    decade, the cost of a ‘minimum’ basket of goods and services has risen by 43 per cent,
    compared with 27 per cent for CPI.
30. Professor Michael Crawford, of the Institute of Brain Chemistry and Human Nutrition, has
    written.
         Fish and sea food are the principle sources of DHA ((Docosahexaenoic acid) in the food
         chain and that the brain originated using it for structure, function and neural gene
         control, some 500 million years ago. However, fish and sea food have other specialist
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         properties including the trace elements such as iodine and selenium both of which are
         in short supply and getting shorter, in the land based food web. Deficiencies of DHA
         and Iodine both restrict brain development and are likely to co-exist. 2 billion are
         considered to be at risk to iodine deficiency. So the evidence is not just about DHA.
         The Japanese women who eat fish and or sea food every day gave birth to the children
         who have grown up to have the best longevity, least heart disease, common cancers
         and major depression as well as a very low maternal and perinatal mortality and
         prevalence of low birth weight compared to any other developed country.
         Low birth weight associated with fetal growth restriction is the strongest predictor of
         poor learning ability, school performance, behavioural disorders and crime.
31. Low birth weight in some wards of London reach 11-12% of live births against an average in
    England of 7.2% . A detailed analysis of low birth weight in Haringey is attached as Appendix
    iii, and the OECD Appendix iv
        I live in Tottenham. Two Christmases ago I came home to find it trashed; money
        and mobiles had been stolen. Police records show that Haringey wards were
        second, third and fourth worst of London’s burglary hot spots; second was
        Tottenham Green at 21 cases per 1000 residents, third St Ann’s 20 cases and
        fourth Haringay at 19 cases. The safest homes were in Barking and Dagenham at
        1.68.
        Another indicator of poverty is low birth weight; it reached 12.3% of live births in
        Tottenham Green ward between 2007 and 2009 and 11.62% in Haringay; and
        9.24% in St Anns. The England average is an unacceptable 7.18% when compared
        with the best six European nations that are all under 5%. Turkey has 11%. Low
        birthweight, according to the Institute of Brain Chemistry and Human Nutrition,
        when associated with fetal growth restriction, is the strongest predictor of poor
        learning ability, school performance, behavioural disorders and crime.
        Rev Paul Nicolson; August 2011
32. All the poverty of women of child bearing age and its consequences for their offspring are
    exacerbated by current policies which create debt; and will be by further debt creating
    policies in the Bill. Please see case history in APPENDIX v.
33. Suggested amendment C.
   New Clause – Part 5.
     Means inquiry before sanctions, penalties and recovery of overpayments are
     imposed.
      1. In respect of the imposition of an overpayment or a sanction under the Jobseeker's Act
          1995 or any other provision or in the case of a penalty imposed under section 115C of
          the Social Security Administration Act 1992 the Secretary of State or an authority shall
          consider-
         a. evidence of the physical condition of the claimant and his or her state of health;
         b. evidence of the psychological state of health of the claimant;
         c. evidence relating to the means and income of the claimant;
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         d. evidence relating to the accommodation occupied by the claimant and the effect
            that the imposition of a sanction or penalty may have on the right to occupy such
            accommodation;
         e. the family circumstances of the claimant and the impact that it may have on other
            family members and dependants;
         f. evidence of the impact that a sanction or penalty may have on the ability of the
            claimant to fulfil obligations to third parties including those relating to the
            fulfilment of benefit entitlement conditions.
     Before deciding whether to impose a sanction or penalty and shall only do so where,
     having considered all the relevant circumstances, it is reasonable to do so.
 2. Regarding evidence as to means the secretary of state must consider-
         a. the income of the claimant;
         b. the capital of the claimant;
         c. the expenditure of the claimant.
3. In order to facilitate the enquiry into the matters set out in subsection (1) the Secretary of
   State or authority may-
         a. arrange for a medical examination of the claimant;
         b. obtain information from any agency holding relevant information on the income
            and resources of the claimant:
         c. receive evidence from any other person or persons with a knowledge of the
            circumstances of the claimant.
         d. A person who is subject to a penalty may appeal to a Tribunal (Lower Tier) against
            the imposition of such a penalty.
   Brief
   This amendment is supported by;
         AdviceUK
         Caritas Social Action Network                      National Housing Federation,
         Church Urban Fund                                  The Royal College of Psychiatrists,
         Community Links                                    Save the Children
         Derbyshire Unemployed Workers                      Shelter
         Centres.                                           United Kingdom Public Health
         Housing Justice                                    Association.
         Mind                                               Vincentian Partnership
         Money Advice Trust

 34. The DWP will cut down on expensive appeals if they ensure that overpayment, sanctions
     and penalties are imposed by officials after taking into account all the relevant facts and
     circumstances of the claimants. However discussion in committee in the House of
     Commons revealed that the Minister for Employment is content to rely on the common
     sense of jobcentre and local authority officials no matter that there are as many
     interpretations of common sense as there are officials.
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       a. Chris Grayling, Hansard 13th June. “Arrangements are made so that the DEA
          begins only after a period time, but only in exceptional circumstances would we
          waiver repayment. Common sense lies at the heart of this measure. It is our job
          to recover funds that have been overpaid to a claimant when there is not a
          good reason for waiving the repayment.”
       b. Chris Grayling, Hansard 14th May. “The more we prescribe and write into
          primary legislation and the more we say, “You have to take into account these
          10 conditions before you decide whether somebody should be sanctioned or
          not,” the more likely we are to end up with a decision that flies in the face
          of common sense .”
       c. Chris Grayling, Hansard 19th May, “ If we prescribe circumstances for a
          discretionary write-off or non-recovery of an overpayment, we will miss the fact
          that every case is different and every circumstance is different. The degree of
          error is also different in every case. We must have sufficient flexibility in the
          system to apply discretion and common sense to individual cases.”
       d. Chris Grayling, Hansard 5th April. “I think it is about the application of common
          sense . This is not about getting someone to apply for a new job every month.
          Let us take the case of somebody with a disability who goes back into work for
          12 hours a week, spends a year doing that work and is by then performing well
          and has clearly settled back into the working environment. That person has the
          potential to do more, but that particular employer does not have the
          opportunity for them to do more. At that point, it makes logical sense for them
          to be given help and assistance to move on into something with longer hours.
          That is how we envisage the system working.”
35. The government also intends to rely on a Code of Practice. The Minister for Welfare
    Reform wrote to Z2K on the 9 June 2011.
        However, we recognise that we have a duty to balance the needs of individual
        benefit recipients against those of the taxpayer. There will, therefore, be a
        Code of Practice to ensure that people are treated fairly, but our responsibility
        will remain to protect public funds and ensure, where possible, that money
        that should not have been paid is recovered.
36. The advice sector needs teeth when appealing decisions by officials. Codes of practice do
    not give any legal rights to claimants like those in regulations or on the face of the Bill.
    They might be admissible as evidence in judicial review but that is expensive and
    unattainable for many claimants in the light of cuts in legal aid for civil cases. There is no
    automatic right of appeal to the tribunal if officials misinterpret or ignore the code of
    practice.
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37. Suggested amendment D
    Clause 102.
   Insert
   71Z1 Non- recoverable overpayments.
   The Secretary of State may not recover any amount of any benefits paid in error by
   officials when the claimants could not reasonably be expected to know they were being
   overpaid.
    Brief
38. This amendment is supported by;
   AdviceUK
   Caritas Social Action Network                           National Housing Federation,
   Church Urban Fund                                       The Royal College of Psychiatrists,
   Community Links                                         Save the Children
   Derbyshire Unemployed Workers                           Shelter
   Centres.                                                United Kingdom Public Health
   Housing Justice                                         Association.
   Mind                                                    Vincentian Partnership
   Money Advice Trust

   Section 71 of the Social Security Administration Act 1992
39. Section 71 of the Social Security Administration Act 1992 was designed to protect
    individuals from the errors of the State. In essence, it protects citizens against negligence
    by the Department of Work and Pensions or local authorities when calculating benefits.
    This protection is abolished in the Bill. The amendment covers all benefit payments and
    restores the protection.
40. If a citizen lies or conceals facts from the Department, HMRC or a local authority so that
    an overpayment of benefit is made, then the Department can recover the money through
    the courts or by deductions. If however the Department, HMRC or Local Authority makes
    an official error through its own negligence, then the citizen cannot, currently, be forced
    through the courts to repay the money.
41. The DWP - Housing Benefit/Council Tax Benefit Overpayments Guide 2006/7 reads;
        Non-recoverable overpayments
        These are official error overpayments, either LA or departmental, that occur
        when the claimant could not reasonably be expected to realise that they were
        being overpaid. These cannot legally be recovered.
42. That has been abolished in the Welfare Reform Bill; enforcement of official error
    overpayments against blameless claimants will be allowed – decisions relying far too much
    on the discretion and common sense of the same officials. See case history in APPENDIX v
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   The consequences of reversing the rule.
43. This amendment does not make any government a soft touch because the burden of
    proof is shared between the government agency and the claimant. The agency has to
    check that an error has been made and the claimant has to prove he/she could not have
    known about it. Government agencies very rarely volunteer the information that a
    blameless error cannot legally be enforced; mostly claimants do not know until alerted by
    an authority or told by an adviser.
44. Reversing this rule – which was introduced in 1975, endorsed by John Major’s government
    in 1992 and again in 2006/7 guidance of the DWP – would also take us into a legal
    minefield. Effectively claimants would be expected to pay for the negligence of the state.
45. In such a case the citizen might launch a counter claim, seeking recovery or set off of all the
    money s/he has paid in national insurance contributions over the years and for damages
    for stress and inconvenience. The welfare state has been paid for by national insurance
    and taxes paid by citizens, and aggrieved claimants might seek redress through the courts.
    All the unemployed are taxpayers; many will have paid stamp, income and council tax
    before becoming unemployed.
46. Why should the claimant be expected to pay for the error by a DWP or local council
    computer? In cases such as housing benefit, the mistake may also have arisen from a
    mistake by the landlord, a bank, the local authority itself or another party supplying
    information.
47. In the case of housing benefit it would open up claims by LAs against landlords, particularly
    those who have HB money paid direct to them, since the changes in the HB system in April
    2009. This is because landlords are the ultimate recipients of the welfare money deriving
    the benefit. It might also result in third party proceedings being brought against individual
    officers or their superiors who were responsible for the official error – they could be sued
    directly for negligence.
48. In 1980s the Department sought to recoup social security benefits paid to people who were
    injured as a result of accidents when the claimant obtained damages. Not only did this
    generate a great amount of ill-will when the state seized sums of compensation, but
    lawyers got round it and ultimately insurance payments went up for everyone until the
    practice was abolished.
49. Clause 102 71ZD (3) (e) Deduction from earnings - currently reads.
           (1)Regulations may provide for amounts recoverable under section 71ZB
           to be recovered by deductions from earnings.
           (2)In this section “earnings” has such meaning as may be prescribed.
           (3)Regulations under subsection (1) may include provision—
                   (e)as to a level of earnings below which earnings must not be
                   reduced;
50. The problems with (e) are that;
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           a. It protects vulnerable and impoverished claimants from excessive enforcement of
              overpayments but not any other debt. So rent or council tax arrears, can swallow
              up the protected amount of earnings.
           b. so provision needs to be extended to all debts as is the practice in Scotland and
              several European countries.
           c. there is no attempt to measure protected level of earnings, in the light of the
              weekly cost of essentials in the market.
           d. It does not cover unemployment benefits.
           e. the government does not have to write any regulations protecting a minimum
              amount of income.
     So we propose the following amendments;
51. Suggested amendment E
     Clause 102 71ZD (1) delete “earnings” insert “incomes”.
     Delete Clause 102 71ZD (3) (e)
     Insert (e) Regulations under subsection (1) shall include provision
         i. as to a level of earnings below which income must not be reduced;
        ii. requiring the Secretary of State to take into account research into the minimum
              incomes required for healthy living when deciding the level of earnings in (i).
       iii. protecting the reduction of the level of earnings in(i) by any other debt.

     Brief.
 52. This brief has been prepared with the help of Professors John Veit-Wilson and Elaine
     Kemson, and Damon Gibbons of Debt on our Door-Step.
     The Government produced Clause 102 71ZD (3) (e) at the report stage in the House of
     Commons. It echoes the practice in Sweden, Germany, the Netherlands, Norway and other
     nations where there are legally enforceable attachment free limits when all debts are being
     enforced; the level of the limits is related to national minimum income standards set by a
     variety of methods. It also reflects the Scottish Protected Minimum Balance (PMB). The
     PMB applies to arrestment executed against a debtor's account in a bank or other financial
     institution, and protects a set amount of funds from being arrested. The lower monthly
     threshold to was raised to £415 in April 2010. .
 53. The principle of irreducible attachment free minimums should be extended to all debts, to
     the unemployed, in particular safeguarding children’s, disability and housing benefit. It
     prevents the damage done to mental and physical health by the enforcement of debts
     against poverty incomes and the damage to the capacity of the poorest adults to find and
     keep work.
 54. In Sweden the standards for a reasonable level of living are up-rated for price index
     changes every year and reset every five years by the National Board for Consumer Affairs.
     They are based on survey data on national household consumption patterns and current
     prices. This means that the statisticians and the NBCA policy officials are deciding what is
     reasonable in terms of deviations from the averages – for example for the past four years
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   in the UK the prices of food and domestic fuel have increased faster than the both the RPI
   and the CPI.
55. These standards are used by the social service board for setting benefits and by the tax
    authority for setting the tax threshold. The tax threshold is also used by the court
    enforcement authority to set its attachment-free sum for debt enforcement. The sum
    consists of two parts - variable housing costs and a fixed standard 'normal' sum for all other
    living expenses.
56. The actual cash sums are of course no use without purchasing power parity conversions,
    but at a rough current conversion factor of 10 kronor to the £1 the weekly sums shown are
    about £100 for a single adult and £170 for a couple. The main point is that the total sums
    of standard allowance andrent are irreducible.
57. The German attachment-free limits derive at heart from the constitution’s statement of
    the human right to dignity and the social code’s statement that this means a right to a
    dignified level of living. It is set, very roughly speaking, by the national statistical bureau
    using comparison with the actual expenditure patterns of the lowest quintile of income
    recipients who are not receiving social assistance. They are assumed to possess and be
    ascribed with human dignity. The risk in the German system is that poverty is defined as
    the level of living of poor people. But the main point is that these attachment free limits
    have can be enforced by the courts and they relate to national income standards.
58. In the Netherlands there is an attachment free amount which comprises 90% of the social
    minimum, plus subsidies for rent and health insurance premium plus a nominal amount.
    The nominal amount is decided by the courts if the parties cannot reach agreement. The
    commission made rules for this part, so everybody is treated equally. The national social
    minimum is 1300 euro per month for a couple, 90% for lone parents and 70% for singles.
59. So there we have three nations with irreducible attachment free limits, enforceable by the
    courts and related to national minimum income standards. In setting payment plans,
    courts ensure that the debtor is left with a minimum level of income, taking account of
    family size. This is often at the level of social assistance, although Norway is notable for
    having a much higher guaranteed income. This is set at 85% of the level of the minimum
    pension. This is considerably higher than social assistance levels. In contrast, in the
    Netherlands, the minimum guaranteed income is just 90% of social assistance, although
    this does need to be set against a shorter payment period.
   Rev Paul Nicolson. Chair.
   Zacchaeus 2000 Trust
   34 Grosvenor Square,
   London SW1W 0DH
   Office; 02072590801
   Home; 02083765455
   Mobile; 07961177889
   e-mail; paulnicolson@z2k.org
                                                       14



                                      A TALE OF TWO ENFORCEMENTS

                                               (names changed)
1. NO SUPPORT
Local Government Ombudsman reports the case of Mr “Watson”, a single, semi literate adult living alone in
Southwark. Jobcentre Plus mistakenly cancelled his JSA so Southwark cancelled his housing and council tax
benefits creating arrears in both accounts. On the 12th January 2001 CSL, Southwark’s out sourced agent
collecting council tax, sends Mr. Watson a summons for unpaid council tax of £235.10, plus costs, for a
hearing on 9th February 2001. The summons contains the following threats, in bold type and highlighted.
Thousands are dispatched daily:
        “If a liability order is granted the council will be able to take one or more of the following actions:
        Instruct bailiffs to take your goods to settle your debt - this can include your car. You will be liable
        to pay the bailiffs costs which could substantially increase the debt. Instruct your employer to
        deduct payments from your salary or wages. Deduct money straight from your jobseekers
        allowance or income support. Make you bankrupt. Make a charging order against your home. Have
        you committed to prison”.
His sister-in-law calls on him. His body is hanging in his flat. The police found the summons with him,
paper littered with rough calculations and a note:
“Dear ….        I at to do this I am in so much in Detr good By for ever Love……”
Threats of eviction for rent arrears were not far off. JSA was £53.05 a week after rent and council tax. (Now
£64.30). The Joseph Rowntree Foundation minimum income standard for healthy living, after rent an
council tax, is £144 a week for a single adult.


2. McKENZIE FRIEND SUPPORT.
We work with ATD Fourth World who are close to the poorest people in London. They asked for our help
with “Sarah” a 51 year old who is single, unemployed, semi literate and in debt to Lambeth Council. Her
Doctor tells us “she has learning difficulties and is illiterate and for many years has had chronic anxiety with
episodes of panic. Were the Bailiffs to proceed with the seizure of her goods, the effect would be
catastrophic for her and would seriously compromise her health”.

She receives £53.05 a week income. She pays each week a £4.13 a week water rate, £2.50 rent
arrears £36.42 to buy every thing but rent and council tax. Capita Business Services in Bromley
collect council tax for the Council.. She owes £468 from a failed attempt at low paid work. The
failure caused the debt. Equita Bailiffs in Northampton whose computers, blind to her ill health,
illiteracy and poverty, threaten “We have arranged for our bailiff to call at your home this
weekend to seize your goods and transport them to the auction rooms for sale”, and two days later
“NOTICE PRIOR TO COMMITTAL TO PRISON PROCEEDINGS”. We tell Lambeth Council who call off
the bailiffs. The computer still runs. Another threat to sell the furniture storms its way from
Northampton to Lambeth. To relieve her anxiety Zacchaeus promises to pay the £468 council tax
arrears should the magistrates be minded to imprison her rather than write off the debt. We also
promise to go to court with her. Lambeth backed off.
                                           15



NGOs supporting the Zacchaeus 2000                                            APPENDIX ii
Petition calling for Minimum Income
Standards
              th
Total 71– 10 May 2010

Local organisations
Catholic Children's' Society -Shrewsbury        Health
Church Action on Homelessness in                British Medical Association
London – UNLEASH                                Centre for Food Policy
Communities Against Poverty – Liverpool         Faculty of Public Health - Royal College of
Ilfracombe Credit Union                         Physicians
Liverpool Archdiocese Justice and Peace         Food Commission
Commission                                      Food Justice
St Albans Diocesan Synod                        Food Poverty Project
Partners in Health – Dudley                     Fuel Poverty Project
East London Communities Organisation            Institute of Brain Chemistry
                                                and Human Nutrition
National organizations                          Mencap
ATD Fourth World                                Mental Health Foundation
Access to Justice                               Milk for Schools
Afghan Association of Great Britain             Mother an Child Foundation
Campaign Women                                  National Heart Forum
Debt on our Doorstep                            Royal College of Nursing
European Anti Poverty Network                   Socialist Health Association
Labour Land Campaign                            UK Health for All Network
Lobby to end Age Discrimination – LEAD          UK Public Health Association
Low Pay Unit
National Consumer Council                       Trades Unions
New Policy Institute                            Trades Union Congress
Refugee Council                                 UNISON - (conference decision)
Scottish Low Pay Unit
TUC Unemployed Workers Combine                  Faith
Women In Prison Trust                           Catholic Agency for Social Concern –
                                                Caritas
Pensioners' Charities                           Catholic Bishops' Conference - Social
Age Concern                                     Welfare Committee
Help the Aged                                          (wound up in February 2002)
National Pensioners' Convention                 Catholic Child Welfare Council
                                                Church Action on Poverty
Parents' and Children's Charities               Church of England - General Synod -
Barnardos                                       (Motion won 339 - 0)
Buttle Trust                                    Church of Scotland - General Assembly -
                                                (Unanimous decision)
Child Poverty Action Group                      Conference of Religious in England and
                                                Wales - Social Justice Desk
Children's Society                              Christian Council for Monetary Justice.
National Council for One Parent Families
Maternity Alliance                              Methodist Conference (unanimous
NSPCC                                           decision)
NCH action for children                         Muslim Council of Great Britain
Parenting Education and Support Forum           Iona Community
Save the Children Fund                          Von Hugel Institute
Single Parent Action Network                    Vincentian Millennium Partnership
End Child Poverty
16
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