DECISION OF THE SOCIAL SECURITY COMMISSIONER
1.	My decision is given under section 14 of the Social Security Act 1998. It is:
The decision of the Fox Court appeal tribunal under reference U/42/163/2003/00900, held on 3 August 2005, is not erroneous in point of law. 
Background
2.	The claimant has had an award of income support for some years. Initially, he was living in rented accommodation and receiving housing benefit of £299 a week. He developed symptoms that have been diagnosed as chronic fatigue syndrome. On the basis of advice that he would benefit from a programme of graduated exercise, he obtained exercise equipment and sought a home that would accommodate it – it consists of ten pieces of equipment spread over four rooms. In due course, he found a property and was bought out of his tenancy. He purchased his new home with the help of an interest-only self-certified mortgage of £484,000. The Secretary of State allowed interest on £100,000 only as housing costs. 
What the claimant wants
3.	The claimants wants housing costs in respect of (i) the whole of the interest on his mortgage or, at least, (ii) the amount of housing benefit that he was receiving before he bought his home.
The appeals
4.	The claimant exercised his right of appeal to an appeal tribunal. He was not represented at the hearing, but produced two written arguments in support of his case. One was advice from David Blundell, of counsel. The claimant told me that this was actually the advice of Richard Drabble QC, but he had been too busy to put it into writing. The other, more detailed argument, was by Martin Williams of LASA. 
5.	The tribunal dismissed the appeal, but the chairman gave leave to appeal to a Commissioner. The Secretary of State did not support the appeal on paper. The claimant, in response, asked for an oral hearing, which I held in the Commissioners’ court in London on 13 July 2006. The claimant attended alone. I am grateful to him for presenting his arguments so clearly. The Secretary of State was represented by Mr Roger Lutterodt, of the Office of the Solicitor to the Department for Work and Pensions. I am grateful to him for presenting the Secretary of State’s argument so concisely.
6.	The claimant told me that he had hundreds of other documents that he could show me if I wished. I have considered whether I should see any of those documents, but have decided that it is not necessary. The issue for me is one of statutory interpretation and I cannot envisage that any of the other documents would be relevant to that exercise.
The procedure at the tribunal
7.	Although the claimant did not criticise the chairman of the appeal tribunal personally, he did in his written appeal complain of the way that the hearing was handled. However, he accepted that the hearing before me cured any complaints he had about the hearing before the tribunal. I need, therefore, deal only with the interpretation and application of the legislation. 
The legislation
8.	The issue for me depends on the correct interpretation of paragraph 4(7) and (12) of Schedule 3 to the Income Support (General) Regulations 1987. I need to set those provisions in their legislative context. 
9.	Income support is an income-related benefit. Put in its most basis terms, a claimant’s entitlement is fixed as the difference between income and what the law calls the ‘applicable amount’: see section 124(1)(b) of the Social Security Contributions and Benefits Act 1992. The applicable amount is governed by section 135(1) of that Act. Part IV of the Income Support (General) Regulations 1987 is made under the authority of that section. It provides that the applicable amount may contain an amount ‘in respect of mortgage interest payments or such other housing costs as may be prescribed’: see regulation 17(e). The detailed provisions on housing costs are contained in Schedule 3 to the Regulations. This Schedule has been regularly amended and was re-enacted in 1995. It distinguishes, amongst other matters, between the types of cost that qualify, the circumstances in which they are met and the amount of a loan that is taken into account.
10.	Paragraph 1 of Schedule 3 provides that
‘the housing costs applicable to a claimant are those-
	(a)	which he … is … liable to meet in respect of the dwelling occupied as the home …, and
	(b)	which qualify under paragraphs 15 to 17.’
Paragraphs 15 to 17 deal with the types of costs that qualify: loans on residential property, loans for repairs and improvements and other housing costs such as ground rent and service charges.
11.	Paragraph 4 of Schedule 3 deals with circumstances in which housing costs are not met. The basic rule is that housing costs in respect of a loan incurred while a claimant is on income support are not met: see paragraph 4(2) and (4). 
12.	There are exceptions to this basic rule. These are governed by paragraph 4(7). The claimant has relied on the wording of this provision:
‘Notwithstanding the preceding provisions of this paragraph, housing costs shall be met in any case where a claimant satisfies any of the conditions in sub-paragraphs (8) to (11) below, but-
	(a)	those costs shall be subject to any additional limitations imposed by the sub-paragraph; and
	(b)	where the claimant satisfies the conditions in more than one of these sub-paragraphs, only one sub-paragraph shall apply in his case and the one that applies shall be the one most favourable to him.’
13.	I need only refer to sub-paragraphs (8) and (9). Sub-paragraph (8) applies if the claimant purchases a property while in receipt of housing benefit. And sub-paragraph (9) applies if 
‘the loan was taken out … to acquire alternative accommodation more suited to the needs of a disabled person than the accommodation which was occupied before the acquisition by the claimant.’
14.	The Secretary of State’s decision-maker treated the claimant as satisfying either or both of (8) and (9). The tribunal dealt with the appeal on the basis that (8) applied, but was doubtful about (9). As the Secretary of State does not dispute that the claimant’s housing costs fall within an exception to the basic rule in paragraph 4, I do not need to decide which exception applies. 
15.	Paragraph 4 ends with this provision:
‘(12)	The following provisions of this Schedule shall have effect subject to the provisions of this paragraph.’
16.	Paragraph 11 makes general provisions for housing costs. One provision limits the amount of a loan that is taken into account. 
‘(4) Where for the time being a loan exceeds … the appropriate amount specified in sub-paragraph (5), then the amount of the loan … shall for the purposes of this Schedule, be the appropriate amount.
‘(5) Subject to the following provisions of this paragraph, the appropriate amount is £100,000.
17.	Paragraph 16 deals with loans for repairs and improvements. These include ‘adapting a dwelling for the special needs of a disabled person’: see paragraph 16(2)(k). And paragraph 11(9) provides that loans for this purpose are disregarded in calculating the appropriate amount for paragraph 11(5).
The claimant’s argument
18.	The claimant’s argument was this. He relied on paragraph 4(7) and in particular on the word shall. He argued that it conferred on him the right to have all his interest taken into account in calculating his applicable amount. He also relied on paragraph 4(12) and argued that it overrode the effect of paragraph 11(5). He accepted that his housing costs would be subject to other restrictions, like those on excessive costs (paragraph 13). He referred to the legislative history of the paragraph 4 and to the report of the Social Security Advisory Committee on the draft legislation. He also cited the decision of Mr Commissioner Mesher in CIS/0834/1997. 
The Secretary of State’s argument
19.	The argument for the Secretary of State was this. The issue was one of statutory interpretation. The reference to the Social Security Advisory Committee might be useful, but only as an aid to interpretation. The limit of £100,000 in paragraph 11(5) applied to the claimant’s loan. Paragraphs 5 to 19 were of general application to any costs that were met. Paragraph 4(7) said that housing costs had to be met, but did not say how they had to be met. There was no express provision excluding regulation 11(5) when one would have been expected. There was no ambiguity in the legislation. If the claimant was right, it would mean that a claimant was more treated more favourably when buying a home while on income support than otherwise. In conclusion, Mr Lutterodt cited the decision of Mr Commissioner Howell in CIS/5327/1998. 
My conclusions
20.	I accept the Secretary of State’s argument and reject the claimant’s argument. My reasons are these.
21.	Before coming to the particular provisions in Schedule 3, I note its structure. It consists of 19 paragraphs that deal with different issues. I have already mentioned types of qualifying costs, the circumstances in which they are met and the amount. There are others; those are just the ones relevant to this appeal. The different subject matter of each paragraph is apparent from the headings to the paragraphs, their contents and the language used in each paragraph and in references to each paragraph elsewhere. It would be surprising if a provision in paragraph 4 were to have the effect contended for by the claimant. That paragraph deals with housing costs that are not met and some exceptions to that absolute prohibition. Paragraph 11 deals with the amount of the loan and thereby the amount of the housing costs that can be allowed. Why would an exception to the maximum amount of the loan be placed in a paragraph dealing with costs that are not met? 
22.	The claimant occupies the dwelling as his home. So paragraph 1(1)(a) is satisfied. He took out a loan to defray the monies applied for the purpose of acquiring an interest in the dwelling he now occupies as his home. So his loan ‘qualifies’ under paragraph 15(1) and paragraph 1(1)(b) is satisfied. He did not adapt the dwelling for his special needs. All he did was to select a property that was large enough to house his exercise equipment. So his loan does not qualify under paragraph 16(2)(k).
23.	The amount of his loan is actually £484,000. This exceeds £100,000. So the amount of the loan is fixed by paragraph 11(4) and (5) at £100,000. The effect is to limit the interest that is included in the claimant’s applicable amount. Paragraph 11(9) does not apply, because the loan does not qualify under paragraph 16(2)(k).
24.	Note that the amount of the loan is fixed by paragraph 11(4) ‘for the purposes of this Schedule’. That must mean for the whole of the Schedule. In other words, any greater amount is disregarded for all housing costs purposes in Schedule 3. On that basis, paragraph 4 does not deal with any loan over £100,000. The basic rule in that paragraph does not apply over that amount, because it is not part of the loan. And if the rule does not apply, the exception to that rule cannot apply either.
25.	There is no qualification in paragraph 11 making it subject to paragraph 4(7) to (11). If one or all of those sub-paragraphs displaced paragraph 11, I would have expected to find such a qualification. This is especially so, as paragraph 11(4) expressly says that it applies for the purposes of the Schedule. The lack of any qualifying reference to paragraph 4 is all the more surprising because paragraph 11(5) is expressly made ‘Subject to the following provisions of this paragraph’. 
26.	Paragraph 4 contains a basic rule that housing costs are not to be met in respect of loans taken out while a claimant is on income support. Paragraph 4(7) introduces a series of exceptions. It provides for those exceptions to contain conditions that are additional limitations. What are they additional to? They can only be additional to the limitations set out in the other paragraphs of Schedule 3. 
27.	Legislation often provides that provision A is ‘subject to’ provision B. That means that provision B has priority over provision A. The usual effect is to limit the scope of provision A. Paragraph 4(12) provides that paragraphs 5 to 19 are ‘subject to’ paragraph 4. If the basic rule in paragraph 4 applies, that means that the other provisions do not apply. And if one of the exceptions in sub-paragraphs (8) to (11) applies, it means that the limitations in paragraphs 5 to 19 apply as well as any conditions in those subparagraphs.  
28.	The argument on paragraph 4(12) focused on redundancy: if it does not mean what the claimant says, it is meaningless and irrelevant. I do not accept that a provision is redundant merely because it adds nothing to a provision. It may still perform the useful function of emphasising a point or putting it beyond doubt. That is what it does.
29.	The claimant argued that paragraph 4(7) displaced paragraph 11, but accepted that it did not displace paragraph 13, which deals with excessive housing costs. He did not put forward any basis for distinguishing between paragraphs 11 and 13. He drew my attention to the circumstances in which housing costs would and would not be excessive, but did not say why those factors distinguished the paragraph from paragraph 11. I can find nothing to justify this distinction.
30.	At the end of his argument, Mr Lutterodt referred to CIS/5327/1998. If this case had been cited to the tribunal, it is possible that it would have saved a great deal of time and, probably, would have prevented the chairman granting leave to appeal. The Commissioner wrote:
‘23.	By the same token, although the provisions now in para 4 of Schedule 3 for restricting people who are already on income support from “trading up” at the public expense by increasing the amount of their loans qualifying for public assistance continue to embody the same muddle by defining the various special cases in which this restriction is not to apply in terms of “housing costs to be met”, no reasonable person could in my judgment take those provisions of para 4 as intended to mean that all housing costs in those specially excepted cases should suddenly start to be met without any limitation at all and without being subject to the normal provisions for quantification of applicable housing costs to be found in the later provisions of the Schedule itself.  That would be a quite unreasonable and absurd construction and the references in para 4(7) to “housing costs to be met”, and in para 4(12) to the following provisions of the Schedule having effect “subject to the provisions of this paragraph”, are not to be read so over-literally.  
‘24.	It is clear in my judgment that the provisions of paragraph 4(8)-(11) are concerned with identifying on a once and for all basis the types of loan which are to continue to qualify an income support claimant to receive (appropriately calculated) housing costs, notwithstanding the normal exclusion under para 4(2) for new or additional house purchase loans:  those provisions are not concerned with defining or quantifying what the housing costs to be met in the special cases are.  That is a matter dealt with elsewhere in the Schedule, and is subject to the normal provisions for computation and any limitations to be found there.  Para 4(7)(a) appears to me to make that entirely clear by its reference to “additional limitations”:  in other words, any special limitations imposed by sub‑paras (8)-(11) are to be in addition to whatever limitations otherwise apply in any case in determining the amount of housing costs allowable.  Those limitations of course include the restriction of allowable interest to a standard rate; the ceiling of £100,000 on which allowable interest for purchase loans can be calculated; and the limitation to prevent claims for excessive or unreasonable housing costs, under paras 11, 12 and 13 of the Schedule.’  
I respectfully agree with that reasoning. 
The legislative history
31.	What is now paragraph 4 was introduced from 2 May 1994; it was originally paragraph 5A. The draft legislation was referred to the Social Security Advisory Committee. Its report was published as Cm 2537. The claimant referred me to two paragraphs from the memorandum written to the Committee by the Department of Social Security. The memorandum began by saying that the amendments would prevent a claimant from increasing housing costs while receiving income support. It then explained some exceptions:
‘Loans for adaptations and moves necessitated by disability: This will include loans increased or taken out to make adaptations to the home to meet the disablement needs of the claimant or someone who lives with him, or to move to new accommodation for this reason. Also exempt will be increase or new loans resulting from the need to move or adapt existing accommodation to care for a disabled person who is currently living elsewhere.
‘Loans for moves into owner occupation: At present, tenants who exercise the Right to Buy while receiving Income Support may have their new housing costs met up to the level of their previous Housing benefit. This principle will be extended to all claimants. So that tenants who move into owner occupation (whether in the existing home or a new one) will continue to receive the same level of benefit help as they did while renting. Thus for example a claimant living rent free with parents who buys a home will receive no help with the mortgage. Provision will be made for subsequent “unplanned” increases in housing costs, for example increases in interest rates, to be taken into account.’
The claimant pointed to the words may have their housing costs met up to the level of their previous Housing Benefit and will continue to receive the same level of benefit help as they did while renting. He argued that they showed that he was entitled to the amount of housing benefit that he was receiving immediately before he bought his home. 
32.	Those paragraphs do not support his case for two reasons. First, I have to interpret and apply the legislation. The Department’s memorandum is not legislation. Second, the words have to be read in their context. That context is an introduction to the draft legislation. And that legislation had to fit into the existing Schedule 3, which had included the £100,000 ceiling since 3 August 1993. On my interpretation, that legislation does not mean what the claimant says. 
33.	I can understand why the claimant has read those words as he has. However, they are capable of another meaning. The words up to the level of their previous Housing Benefit can be read as setting a limit beyond which costs would not be met, rather than guaranteeing that they would be met up to that amount regardless of any other provisions in Schedule 3. And the words same level of benefit help can be read as referring in general terms to financial support for housing costs, rather than as referring to a specific monetary amount.
34.	Although I do not accept the claimant’s argument on the terms of the reference to the Committee, I am grateful to him for drawing it to my attention. It has reminded me of the sequence of events. The £100,000 ceiling came into force from 2 August 2003. The reference to the Committee was made on 27 October 1993. It does not say that the draft legislation introduces an exception to that ceiling. There would surely have been some mention if there was to be an exception to a rule that had come into force less than 3 months earlier. 
35.	The claimant also referred me to the legislative history of paragraph 4(7). As originally enacted (as paragraph 5A(6)), it began:
‘Notwithstanding sub-paragraph (1), the housing costs shall be met in accordance with the provisions of this Schedule …’
He pointed out that the words in accordance with the provisions of this Schedule had been removed when Schedule was re-enacted from 2 October 1995. He argued that that must be significant and showed that paragraph 4(7) was no longer subject to the other provisions of the Schedule. I do not accept this argument. Those words were in the draft legislation referred to the Committee, but what is now paragraph 4(12) was not. However, paragraph 4(12) was added when the legislation was enacted (as paragraph 5A(12)). It is easy to understand why the words were removed in 1995 – they duplicated what was already covered in more general terms by sub-paragraph (12).
36.	Although I do not accept the claimant’s argument on the legislative history, I am grateful to him for drawing it to my attention. It explains something that puzzled me. Paragraph 4(7) provides that housing costs shall be met. Why shall rather than may? The legislative history explains why. As originally enacted, it was appropriate to use shall because it was qualified by in accordance with the provisions of this Schedule. Those words have been removed, leaving shall to stand alone. That is why it seems a strange choice of word in the present context. 
The claimant’s arguments – some miscellaneous points
37.	The claimant referred me to two Commissioners’ decisions. 
38.	One issue discussed by the tribunal was whether paragraph 4(7) to (11) merely contained exceptions to the basic rule or also conferred rights on claimants. In the tribunal, this was discussed in terms of whether the subparagraphs contained just exclusions or exclusions and inclusions. In this context, the claimant cited R(IS) 8/94. He argued that this showed that the subparagraphs could confer rights. In that case, the claimant was a secure tenant who had purchased her home. Her housing costs were limited to her eligible rent plus increases in interest rates. The claimant’s interest rate had increased and then reduced. The Commissioner decided that she remained entitled to the increase despite the later reduction. That issue was different from the one that I have to decide and I have not found that case relevant in deciding whether the £100,000 ceiling applies to the claimant’s loan in this case. 
39.	The other decision cited by the claimant was CIS/0834/1997. In paragraph 2, referring to what is now paragraph 4(7) to (11), the Commissioner wrote:
‘In a number of other cases the full new liability would be met if specified conditions were satisfied.’
The claimant pointed to the word full. I am sure that the Commissioner would not have used that word if he had known how the claimant would understand it. The Commissioner was not dealing with the issue that I have to decide and his words are not to be read outside of the context of the issues in that case.  
40.	Finally, the claimant referred me to the commentary to paragraph 4(9) in Social Security Legislation 2005, Volume 1:
‘If the loan is taken out, or increased, to acquire a home to meet the needs of a disabled person, this is exempt from restriction under subpara.(2) (although the excessive housing costs rule (para.13) and the ceiling on loans in para.11(5) could apply).’
The claimant pointed to the words could apply, which suggested some uncertainty. I accept that those words convey some uncertainty. But that is only because the ceiling may or may not apply, depending on the amount of the loan.  
Complaint for poor advice
41.	The claimant said that he had sought advice before buying his home from several benefit offices and they had all advised him that his full housing costs would be met. I only have power to interpret and apply the legislation. I have no jurisdiction over complaints about the accuracy of advice that the claimant received. I did, though, note one significant comment that he made at the end of the hearing. He showed me a handwritten note that he had received from one office. He added that he had been sent a lot of detailed information with it, but he had not had time to read it. I will only say that he will not find it easy to make out a complaint if he did not read the information that he was sent. 
Disposal
42.	The essential facts of the case were not in dispute. The tribunal correctly interpreted and applied the relevant legislation. It did not go wrong in law. I dismiss the appeal. 
Signed on original
on 20 July 2006	Edward Jacobs
Commissioner