IMHO, if a rating has lapsed then it is no longer included in the licence.
If one does not believe that then one will have big problems explaining why a lapsed IR or lapsed IMC holder can not fly special VFR in less than 10K - ("unless the licence includes an IR or IMC rating").
On the specific case, I still think that the school are wasting this pilot's money by requiring them to fly solo as part of the renewal process. If the pilot wants to fly solo before carrying passengers then they would find that not having to pay for instructor supervision on top of the aircraft hire costs would permit the pilot having passed the GFT to complete more solo training for the same money.
People don't fly solo as part of multi engine courses or as part of IMC or IR training so why do so for revalidation?
If people could fly solo from unlicensed airfields without valid ratings then many pilots would never renew a licence because they only fly single seater aircraft.
Regards,
DFC