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good bona fide residential home for elderly demented people. That constituent is having great difficulty in trying to make ends meet and provide the level of service that he is anxious to maintain and would maintain if he could get a sensible level of support from the Department. Over the past four or five years, far from enjoying the £50 increase to which the Department said that he was entitled, he received only a £20 increase in weekly fees. Meanwhile, he has incurred extra employment costs because of Whitley Council increases and the need to employ the more highly qualified staff required for psychiatric patients. The Department should consider carefully that category of fees and the limits for that category of patient. The community charge has been in operation in Scotland for almost one year. The hon. Member for Oldham, West (Mr. Meacher) made the point that the Government will be obliged sooner or later to reconsider the support given to claimants liable to community charge when it is introduced in England and Wales in April. The one-off compensation payment of £1.15 in income support rates for 1989 -90 is significantly less than the amount for which many claimants paying above-average levels of poll tax will be liable after April. When that compensation was first given, an income support clawback of 50p was made that has never been made good.

It should be possible to identify a separate amount to compensate claimants for poll tax contributions, which should be increased by the average rise in poll tax each year. One hundred per cent. rebates should be given to all income support claimants liable to poll tax. If the Government set their face against that, there is an unanswerable case for increasing the 20 per cent. contribution element by the average annual increase in poll tax payments. As I read the figures, the social fund has effectively been frozen, for the third year in succession, at £205 million--which shows a degree of bad faith on the part of the Government. The social fund was bruited as an experiment that would be progressive, flexible, and capable of overcoming the anomalies introduced by the 1988 changes, which were themselves the consequence of the Social Security Act 1986. To leave the sum at the level proposed for next year would be a huge mistake and a great shame. Figures for December 1989 show that 56 per cent. of people requesting community charge grants and 40 per cent. of claimants for budget and loan facilities from the social fund were refused. There is a vast potential for the social fund to meet, but its effective freezing for the third successive year is a retrograde step.

The £20 million saving made in the 1988-89 Budget should be made good in 1990-91 and community care grants uprated regularly in line with inflation. For a variety of reasons, the proposed increases in pensions and benefits do not deserve support. They fail to meet the needs of the current generation of retired people who rely on the basic state pension as their principal source of income. Nor will they provide assistance to those struggling to cope with a 20 per cent. contribution to their poll tax or families relying on child benefit to make ends meet. Such improvements as have been made will be at the expense of other claimant groups. For those reasons, I urge the House to reject the orders.

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5.24 pm

Mr. David Nicholson (Taunton) : The answer that the hon. Member for Oldham, West (Mr. Meacher) might have given to the question asked by my hon. Friend the Member for Beaconsfield (Mr. Smith) was that the Opposition have not proposed debates about the distribution of income and wealth on their Supply days because those responsible for purging and purifying the Labour party would not like that or allow it to be done.

I welcome the largely constructive approach taken by the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood), although I regret his call to right hon. and hon. Members to vote against the orders. I hope that my right hon. Friends the Secretary of State and the Minister for Social Security will consider the hon. Gentleman's remarks about mobility allowance and the fees paid to nursing homes. I welcome the positive way in which the hon. Gentleman responded to the interesting speech of my right hon. Friend the Member for Aylesbury (Mr. Raison). From it, there does appear to be new thinking in the House, and, I am told, outside it, in the child benefit lobby. Although I have not until now been sympathetic to many of that lobby's arguments, my right hon. Friend the Member for Aylesbury addressed himself to new circumstances imposed by the community charge and other factors, and I hope that his proposal will be carefully considered.

A critical letter that I received from one of my constituents complains that the Government are adopting a social policy of "Victorian laissez- faire". I question how that can be squared with an increase in social security expenditure of 36 per cent. in real terms since 1979, with more than £1 billion per week in social security benefits in the coming year, and with total expenditure on cash benefits for the long-term sick and disabled doubling in real terms what it was in the last year of the previous Labour Government. Those are extraordinary achievements purely in resource terms, and do not justify the criticism of Opposition Members. I also praise, as I have before in private, my right hon. Friend the Secretary of State for the considerable skill that he has shown in the few months that he has held his present office, in using those resources in an imaginative and intelligent way.

When I intervened in the speech of the hon. Member for Oldham, West in respect of European comparisons, he made the point in response that levels of child support in the countries I mentioned were very much higher than in this country. I wonder, for example, whether that is true of Greece. In France, Germany and the Irish Republic, there is no guarantee of annual uprating of child benefit, and in Italy and Portugal, eligibility is linked to insurance status. France does not pay benefit for the first child. Opposition Members should be careful before arguing that this country is behind in the European family.

Mr. Battle : I invite the hon. Gentleman to spell out France's policy on child benefit. Does he not agree that it introduced family support because of its declining population? France's benefits are well ahead of those of this country, and have been for many years.

Mr. Nicholson : I hear what the hon. Gentleman says, and I hope that we can explore that point in future debates.

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I have welcomed before, and welcome again, my right hon. Friend's imaginative proposals for giving more support to those who care for the disabled, which will benefit 30,000 carers. That is a positive improvement.

The deal for pensioners has always dominated social security debates, and is important to my constituents and to those of many other right hon. and hon. Members. There is a considerable difference in philosophy between the Government and the Labour party, which says, "Let's promise to raise the universal pension by a very large amount, by keeping it in line with earnings." When Labour was in government before, we discovered that that could not be done all the time, and that this effort had a horrifying effect on our economy in terms of spending, taxation and borrowing. The present Government guarantee a minimum, which my right hon. Friend the Secretary of State has managed to improve this past year with the benefits paid to poorer pensioners. Above that minimum, pensioners are now benefiting from their own savings and enterprise in their working lives.

Pensioners' total net income, which is something that we must always consider rather than simply the value of pensions, grew by 23 per cent. above inflation between 1979 and 1986. That is as much every year as in all the five years of the last Labour Government. Between 1979 and 1986, pensioners' incomes grew twice as fast as those of the population as a whole, and that is an important factor. We must bear in mind the fact that in 1979 only 60 per cent. of pensioners had savings incomes. In 1986, the figure was 70 per cent., and among recently retired pensioners in 1986 the figure was 85 per cent., so it is increasing all the time. According to the latest figures, 50 per cent. of all pensioners and 70 per cent. of recently retired pensioners have occupational pension which helps them to cope.

Approximately half of all pensioners own their own homes--44 per cent. own them outright and 4 per cent. own them with a mortgage. Let us consider how the capital value of those homes has increased all over the country, but particularly in the south. It is another matter for debate, because the price increases have caused considerable difficulty in those areas, but we need to consider more imaginatively how income-poor retired people can draw upon the considerable capital values locked up in their homes. My hon. Friend the Member for Bournemouth, West (Mr. Butterfill) tried to carry an amendment two years ago, and I hope that more can be done in that issue. I move on to comparisons with pensions in Europe. There has been a lot of propaganda on this subject. We have all received in our mail allegations that British pensioners are the poorest in Europe. However, there are significant variations between pension arrangements in European countries. For example, in France the pension is half the average earnings in theory, but in practice only one third of French pensioners receive a minimum pension which is designed as a safety net. Only the United Kingdom provides a separate pension for a wife who has not worked.

The comparisons that have been made by the Opposition omit to mention the role played by occupational pension schemes, which are rare in the rest of Europe. Also, in several European countries pensioners are charged for the use of health and social services, but in Britain those services are free of right to every pensioner.

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Mrs. Dorothy Rhodes is president of Pensioners' Voice, which has lobbied strongly on the subject, and she concedes :

"I have been one who has spoken loudly in support of parity with Europe, but during the past year I have been to Pensioners Congresses in Italy and Greece and, having spoken at length to those who actually receive the Euro pensions discover that in many cases the actual cash received in relation to the cost of living is often lower than that in the United Kingdom. I am revising my opinion ; for in no way can our Federation ask for an equality that would disadvantage our own people."

That is an important concession and we should remember it when we pursue the argument about comparisons with Europe.

Every hon. Member who has spoken in the debate has mentioned that we are on the threshold of the new community charge regime. The hon. Member for Oldham, West mentioned double charging by private landlords. There are not many private landlords in my constituency--I wish that there were more, because it would help with the housing situation. I hope that my right hon. Friend the Minister will respond to that remark and give his attention to it, because it is a problem and an abuse and it is used as a criticism of our arrangements for the community charge.

The hon. Member for Oldham, West also alleged a failure to increase family support to meet the community charge level in local authorities which were keeping to the Government's spending guidelines. I am not arguing that income support should increase to a level such as that in Haringey or Islington. I am sorry to see that the hon. Member for Islington, North (Mr. Corbyn) is no longer in his place, because he intervened on this subject. I do not think that anyone would argue that, because all voters, including pensioners, must recognise that they have to pay for Labour extravagance in those areas. [Interruption.]

I am making a point that I think Opposition Members will recognise is fair, because the hon. Member for Oldham, West mentioned Kingswood, which is near my constituency, and I hope that my right hon. Friend the Minister will respond to that because it is an important point. On the subject of the community charge, I shall quote what I wrote in my local newspaper recently. It is no bad thing for hon. Members to say to the Government and to the Opposition in this House what they are saying to their constituents outside it. I said : "My constituents (and I) have a right to be angry--but with the Department of the Environment, not the County Council at the huge discrepancy between the final figure, whatever it is, and all the figures previously forecast."

We think that the figure for the community charge in my area is going to be near £350. The reason I mention this is that the elderly and families on low incomes are told all the time to plan ahead and to budget. They do plan ahead. They listen with care to the figures that my hon. Friends and I have given them as to what we thought the community charge would be. We were guided by the figures that the Department of the Environment issued year after year.

Mr. Leigh : That was rash.

Mr. Nicholson : My hon. Friend says that that was a rash thing to do, and perhaps I should take his advice and not believe the Government's statistics, but I think we would be in bad trouble if we had to believe the statistics that the hon. Member for Oldham, West uses all the time.

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On 17 November 1987, the estimate for the community charge in my constituency, based on 1987-88 spending, was £187. On 23 June 1988, my right hon. Friend the Minister for Agriculture, Fisheries and Food, as he now is, estimated that the figure, again based on current spending for 1988-89--I am not talking about Government targets or assessments--was £212. Finally, on 19 July 1989, my right hon. Friend the Secretary of State for Trade and Industry, as he now is, produced a table which again illustrated the impact of the community charge, if it had been implemented last year, giving a figure of £253. I fear that those figures are way below the amount that we are going to have to pay, and I think that that chiefly reflects an unsatisfactory grant settlement.

Over the coming months, I shall make efforts--and I think that many of my hon. Friends will join me--to help my elderly constituents and families on low incomes with the community charge in two ways. First, we shall carefully examine local government spending, make comparisons with other local authorities, see where local authorities managed to come up with a charge which is lower, what they have done and what efficiencies they have introduced. I think that we will benefit from the work of the Audit Commission because it has a powerful role in these matters. And we shall try to get the total spending by local authorities down wherever we can. I am sure that Labour-controlled local authorities have a major role to play in that.

Secondly, we shall try to obtain a better grant from central Government by next year--I do not think there is much to be done for this year. I think that is particularly valid for

Conservative-controlled local authorities, so that we can move closer to the figures that the Department forecast for the charge. I make no apology for raising this subject during a debate on social security because the beneficiaries of social security--the elderly on limited incomes and poorer families--are very concerned about it, and I am sure that that will be reflected in my surgery and in my mail box during the next few weeks.

On this side, we all praise Ministers in the Department of Social Security for what they have done to obtain and use resources. They should look to one or two Ministers in other Government Departments for co-operation in dealing with these problems. But we certainly want more sense and reason from Labour-controlled local authorities in meeting the need to help people in vulnerable positions. 5.40 pm

Ms. Dawn Primarolo (Bristol, South) : I shall make two points to the hon. Member for Taunton (Mr. Nicholson), the first by way of advice : beware Ministers bearing tables quoting poll tax figures ; do not make press statements until the final figure is announced. Secondly, when he goes to the Minister to negotiate a better grant settlement for his local authority, we should like to add a few more local authorities to give him a rather long list. I am sure that he will be prepared to argue for Avon county council, a hung council, run by the Tories, in which Kingswood is based.

Mr. Raison rose--

Ms. Primarolo : I have not started yet.

Mr. Raison : I thank the hon. Lady for allowing me to interrupt so early. Any local authority wanting to increase its revenue support grant next year might note that one

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factor which contributes to the size of the needs element in the revenue support grant is the number of false fire alarms. Therefore, if one stimulates many false fire alarms, the needs element goes out.

Ms. Primarolo : I am grateful to the right hon. Gentleman for that little tip, which I shall pass on to the local authority in Avon. To return to the instruments that we are discussing tonight, when there is a massive redistribution of income through cuts in income tax for the top scale of those who pay the tax, little is said by the Government, although there is a massive loss of income to the Exchequer. When pensioners, the disabled, single parents and those on benefits are given a 50p a week or 25p a week increase, we are supposed to congratulate the Government on their generorsity to those people.

When we have debates on social security in this House, a little puzzle always goes through my mind : how is it that the Government keep telling us that they are spending so much more money which people in need are receiving, yet the people themselves are not getting any more disposable income--in fact, they often end up with less money? I have finally come to the conclusion that, if the social security system is set in the context of the 1989 reforms that the Government have undertaken over a period, what has been set up is a much meaner system all round.

Even so-called acts of generosity--such as the Government finally giving the war widows their increase--are transferred into people's lives as further cuts. I shall give the example of one of my constituents whom I mentioned in an earlier intervention and about whom I shall write to the Minister. Her name is Mrs. Bidwell. She is 81 years old, and suffers from Parkinson's disease and a number of other illnesses. She is in a private residential nursing home. Her daughter called to see me ; she is allowed to earn £40 a week under the new regulations because her husband is in receipt of invalidity benefit.

Mrs. Bidwell now pays £270 a week to the private nursing home. She has to be in a private home because there are no other types of nursing home in our area. The nursing home charge went up to £295 a week from 1 February, and at present there is no increase in her income support to compensate for the increase in nursing home charges, so she has lost her £40 and is now £2 a week worse off. When the Government increase income support by £10 on 1 April, her net loss will be £32. Therefore, of the £40 that she was given--supposedly disregarded--she has only £8 a week left, with which she has to buy all her extras such as toiletries.

Naturally, Mrs. Bidwell's daughter was extremely upset and distressed when she called to see me. She felt that it was outrageous that her father, who had been killed, as she said, fighting for this country, and her mother, who had struggled all her life raising five children, had finally won justice in the form of the £40 a week rise only to have it taken away because it was still included in the calculations for income support. I should be grateful if the Minister would write to me about this.

That example highlights another point about the Government's policy. Such people are worse off because the Government have allowed the privatisation of nursing

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homes, which are now able to charge whatever they like. As the Minister said, the Government have no control over those increases. Clearly, under the benefits system, the Government are robbing Peter to pay Paul. When extra benefits are given, they are clawed back from other parts of the benefits system. My case work load shows, as I am sure those of many hon. Members do, that claimants from all the priority groups identified in the 1989 social security reform--pensioners, single parents and those leaving institutions to settle in the community to try to establish a normal life--are in extreme need. Those people are being refused grants and loans because of insufficient funds in the local office.

The social fund manager in Bristol, South confirmed yesterday that, despite January's top-up of £8,000 on the grant budget and £25,000 into the loans budget for this financial year, there was to be no change in the policy which rules out a category of claimants from qualifying from that fund. Those who have been ruled out are families under exceptional stress. No one in the Bristol, South office area who comes in that category will be considered for loan or social fund grants. The local office policy is to rule out claims for grants or loans from families under exceptional stress, even though that is one of the priority groups in the social fund manual. Therefore, single-parent familes are being singled out for exclusion from cash. That is the opposite of the undertaking and promises that have been given in this Chamber.

From my case load, it is clear that discretion in the discretionary system operates to exclude the needy from help in order to allow the DSS managers to balance their puny budgets. From the claimant's point of view, there is no discretion or flexibility, merely interminable bureaucracy leading to closed doors. I shall give a couple of examples of such treatment.

A single mother on income support and her two children--one aged two years and the other four months--spent two months in bed-and-breakfast accommodation and were then housed in unfurnished accommodation. She applied for a community care grant of £940 for essential furniture. There is nothing in the house--not even floor coverings. In her letter she said :

"My daughter and I are sleeping on the floor"--

bare floorboards--

"with borrowed blankets from a neighbour. I am very depressed and cannot look after or care for myself and my children in these conditions--we have nowhere to store our clothes and no means of cooking our food."

The grant was refused because

"there are no exceptional circumstances",

to quote directly from the social fund officer's decision in October 1989.

The demands on the budget at the time were so great that these circumstances were considered unexceptional enough for the claim to be disallowed. I dread to think what an exceptional claim in Bristol, South is. If those circumstances are so unexceptional in the welfare state, exactly whose welfare is the state protecting? I suspect that the state is looking after people with money who are getting tax cuts.

One of my constituents who was re-establishing himself in the community after a long period in prison secured the promise of employment, which was vital to him, on a construction site, provided that he had his own tools. He applied for a community care grant. Those grants, we are

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told, are aimed at priority categories. His application was refused. It was not even considered, because the rules stipulate that such items are specifically excluded.

A woman who was born in 1908 was recently hospitalised after she suffered a stroke that disabled her last summer. She needs constant day and night care. Her daughter is on income support. She could not afford the daily bus fares--which worked out at £15.40 a fortnight--to visit her mother in hospital. She visited the hospital daily because she was being trained by the staff to care for her mother. They applied for a community care grant, both for the fares and for the additional items that they need at home. The old lady is incontinent. Their grant application was refused because the circumstances were unexceptional. Bus fares are paid only for the parents of sick children. Once again, both claimants were told that they were not in the exceptional need categories. Time and again we are told that the benefit system is targeting the needy, but time and time again the needy are told that their circumstances are unexceptional.

A Bristol-based charity wrote to all the advice-giving agencies asking that the number of applications made to its charitable fund for help for those in exceptional need but who had been refused grants and loans from the social fund should be reduced because its funds were running out. The Government are breaking up the decision-making process, thus reducing the amount of money that is paid to people in need. They try to convince us that they are giving them more money, but that is not true. At one time, we could be proud of our welfare state. How can we be proud of a welfare state that describes the needs of those people as unexceptional? How bad do people's living conditions and their poverty have to be before the welfare state recognises that they need support?

5.54 pm

Mr. Robert G. Hughes (Harrow, West) : I listened with care to the harrowing constituency cases that the hon. Member for Bristol, South (Ms. Primarolo) drew to our attention. I am sure that she will concede, however, that it is difficult to understand all the facts surrounding constituency cases until we have all the details. I therefore cannot comment on the cases that she has drawn to our attention.

The hon. Lady's sincerity and depth of knowledge compares favourably with what was said by the only other Labour speaker in the debate so far, the hon. Member for Oldham, West (Mr. Meacher). His insincerity and vagueness went down extremely badly on Conservative Benches--and perhaps on Labour Benches as well. He told us that he wanted to talk about poverty and relative incomes. He did neither. Perhaps he thought that it was sufficient to mention them and then to move on to something else.

The hon. Gentleman said that he would outline the Labour party's policy. We should have known better than that. All he did was to add to the interminable list of areas where the Labour party's policy is, to put it at its kindest, far from clear. It is also deliberately transparent. Over £1 billion a week is spent on social security. We have to ask whether that is sufficient. The Labour party has a duty to the House and to the electorate to say what it would spend. Perhaps we shall be told later what the size of the Labour party's social security budget would be this year, if it were

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in office. I think that I can guaranteee that we shall not receive an answer to that question, since the Labour party has not bothered to answer all the other questions that it has been asked. Under this Government, the social security budget has increased in real terms by 36 per cent. since 1979. That is far better than the Labour party's record when it was last in government. Whether it would be found to be better than the record of the next Labour Government, should there ever be one, we do not know.

Mr. Eddie Loyden (Liverpool, Garston) : Does not the hon. Gentleman agree that people are living below the poverty line and that bandying figures about will not change that fact?

Mr. Hughes : I shall deal with the figures during my speech. The Labour party wants people to look at its social policy through rose-tinted spectacles. It does not want them to look at the figures. If the Labour party cares about the problems that face the poor, it must tell us what a Labour Government would spend ; otherwise, it cannot be taken seriously.

Is the £1 billion that is being spent each week on social security going to those who are most in need? My right hon. Friend the Secretary of State gave a number of examples of additional money being specifically targeted on those who are most in need. I shall give two other most important examples of people who will be most grateful for additional help from the Government.

The first is the extra £100 million a year to help 500,000 disabled people and their carers. Those people particularly needed extra money and they will get it as a result of the uprating. Secondly, those of us with young children know that they can be a great expense, but people with severely disabled babies must face enormous extra expenses. The fact that families with severely disabled babies whom one parent stays at home to look after can receive an extra £65 a week under the uprating is a matter on which the Government are to be congratulated.

The hon. Member for Oldham, West pretended to answer one question, but in fact he did not. He told us that the Labour party will restore the link with earnings. He told us how the pensioners and other groups have been robbed by the Government because of their failure to keep the link with earnings. But he failed to tell the House that the reason why the Labour party made the link with earnings, as opposed to a link with inflation, was that that was the cheaper option. The Labour Government had so lost control of the economy, and inflation was so high, that that was the only option that they could afford. If, as the hon. Member for Oldham, West said, the link with earnings would be restored--he hedged his comments about with some weasel words--he must answer a further question. If a Labour Government lost control of inflation, as they undoubtedly would because their policies point in that direction, would they restore the link between the cost of living and the annual upratings? Would they use the best method or the cheapest method?

The Labour party uses statistics to disguise and distort reality instead of telling us the truth--

Mr. Battle : I want to get the record straight, since the hon. Gentleman has talked about distortions. Did not the Labour Government offer a link either with earnings or with inflation, whichever was the higher? That is the truth.

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Mr. Hughes : No, it is not. History shows that that is false ; otherwise, pensioners' incomes would not have fallen so far behind the cost of living under the Labour Government, who stole their £10 Christmas bonus and took away many other things from them. The Labour party cannot preach on this subject, as it allowed pensioners' incomes to fall behind the cost of living.

The Opposition use a number of statistics when discussing the incomes of poorer people, but they use them to distort. Why did they not tell us that between 1981 and 1985 the living standards of the bottom 10 per cent. increased by 8.3 per cent., against an average 6.4 per cent.? Why did not the Opposition tell us that real take-home pay for those on half average male earnings has risen in 10 years by 28.7 per cent.? Between 1973 and 1979 it rose by a pitiful 2.4 per cent.

Why did not the Opposition tell us that, for many of the poorer people in society, tax reductions have an enormous impact? Why did they not congratulate the Government on the fact that the personal allowance increase has taken 1.7 million of the poorest paid people out of paying tax altogether? The answer to all those questions is : because it is uncomfortable for the Opposition.

We can never be satisfied that all those who are most in need are being helped. I would never suggest that they were. A problem mentioned by the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood), in an honest and reasonable speech, and by the hon. Member for Bristol, South, related to those living in private homes for the elderly. What I want to say applies also to elderly people living in some of the homes run by housing associations. We would all accept that many, if not most, of those homes are run to high standards, but the money available does not cover their running costs. As a member of a committee of a housing association, I know that the money that we receive from the DSS does not cover our running costs, so we are running at a loss on some of the people whom we want to keep in the homes. That problem must be dealt with.

I want to discuss two issues connected with housing--first, housing benefits. I hope that all hon. Members agree that it is no criticism of anyone to say that housing benefits have hardly been mentioned in the debate, and for a good reason. If one discusses housing benefits in terms of their relationship to any of the rented sectors, my right hon. Friend the Minister of State will rightly reply that they are a matter for the Department of the Environment ; but if one raises the subject of housing benefits with a Department of the Environment Minister, he will reply that it is a matter for the Department of Social Security. It is thus impossible to debate whether the figures in the upratings are reasonable or unreasonable, sufficient or insufficient, because they have to do with housing policy. I firmly believe that housing benefits must be returned to the Department of the Environment. The only reason why they have not been returned so far is the opposition of civil servants in the Department. They do not want them back ; one told me once that they did not want the bother of them. However, most of us recognise that housing benefits are important and we believe that they would be better administered alongside housing policy. As such, that would be better done by the DOE.

I want finally to mention a group who may see little or nothing from the upratings--the visible homeless. They are not a problem ; they are a series of interrelated problems needing a variety of solutions. Such solutions

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will help many vulnerable people who cannot cope with society. Many of those whom I am discussing, who sleep on the roadside and in shop doorways, could not cope in a house or flat. Many of them would even reject a conventional hostel.

I should like to suggest an additional form of help as part of the pattern of provision. I propose minimalist hospitals funded by the Government and run by the voluntary sector. People could crash out and get a meal in them, and most importantly, they would have access to psychiatric and counselling help. Without such provision, many people will inevitably continue to sleep rough, whatever other solutions the Government come up with.

We must face the problem honestly : many of those whom I am talking about will still prefer to sleep in the streets. Near where I live there is a lady who has lived by the side of the road for 25 years. She has a bed in a mental hospital around the corner and she goes there when it is very cold and for her meals. It is precisely such people, and young people who find themselves in the same position, who need specific but non-threatening help. I hope that the Government will turn their attention to that in their welcome reappraisal of the help that they give the homeless.

6.10 pm

Mr. Clifford Forsythe (Antrim, South) : I welcome some parts of the uprating--for instance, the extra help for poorer families--but I hope that there will be greater take-up of family credit in future. Until now, the take-up has not been good enough, and I hope that some effort will be devoted to publicising the benefit.

I also welcome the extra help for the disabled and their carers, although I have a feeling that the improvement is being paid for by the freezing of child benefits and the cutting of statutory sick pay.

It is disappointing that benefits in general have not been uprated in line with inflation. The most obvious example of that is the freezing of child benefit, which concerns many people. The right hon. Member for Aylesbury (Mr. Raison) made an excellent speech in which he put the case for child benefit very well. I hope that Ministers listened to it.

It is said that child benefit will eventually be phased out, but if it is, the Government will have cause to regret that at the next election, leaving aside high interest rates and the community charge.

The social fund has also effectively been frozen for the third year at around £205 million, despite numerous reports of more and more claimants being turned down for grants or loans for urgent needs. The full effects of the way in which the social fund operates are only now becoming clear. Unfortunately, they will become clearer as time goes on.

Those effects were concealed when the social fund was introduced because an applicant who genuinely required help through force of circumstances could, or perhaps one should say were forced to, take a loan instead of a grant. That loan had to be repaid, reducing the applicant's income. If a further problem befell one--for example, if a cooker needed to be repaired quickly- -a further loan had to be made resulting in higher payments. Such applicants may eventually be unable to apply for an emergency loan

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because they have exceeded the amount of weekly payments that they are rightly allowed by DSS rules. That is a continuing situation that can only get worse.

Unfortunately, it is at that stage that the sad part of the story begins. Such people then turn to the only source of cash available--the moneylenders. People who, for the best of reasons, need finance but cannot obtain it from the social fund, either because of high repayments on previous essential loans or because no money is available in the fund, then approach loan sharks. Such people will then be worse off than they were in the beginning. High interest charges and intimidating collecting methods become their fate. It is not unusual for people in such a position to hand over their benefit books in order to obtain a loan. The debtor is then allowed to take the book to cash a weekly order, which he then uses to pay the required amount of money to the lender who then retains the book for the future. That, sadly, is one of the bad results of the social fund which is there to help people. The situation can only get worse.

Support levels for people in nursing or residential homes do not match the rate of inflation. They certainly do not match their needs. Yet more and more such homes are being required as a result of Government policy in other areas, bringing people into the community who then end up in such homes.

Retirement pensions are uprated in line with inflation, but I am disappointed that they are not being increased in line with average earnings. The pensioners of today once created the country's wealth. It is a disgrace that they are now being treated so shabbily. I am glad to have had the opportunity to point out some of the concerns that I and my right hon. Friends have about uprating. But other hon. Members hope to catch your eye, Mr. Deputy Speaker, so I shall conclude my remarks and hope that they will deal with some of my other worries.

6.14 pm

Mr. Tim Smith (Beaconsfield) : The hon. Member for Oldham, West (Mr. Meacher) said that he wanted a broad debate on incomes, benefits and poverty generally, but he proceeded to make a narrowly based speech. He talked only about state provision. Whether one considers the position of pensioners, those who are at work and become sick, or families, it is not good enough to look only at what the state provides. One must look at a broader picture, but the hon. Gentleman failed to do so.

The hon. Gentleman also complained about the cut in invalidity benefit at the very moment when the Public Accounts Committee is considering why expenditure on that benefit is rising so fast and the number of claimants has risen so rapidly.

The hon. Gentleman might have recognised that the 1980s were a decade when the average income of most pensioners rose more rapidly than ever before. That was not due to state provision alone. The position of pensioners improved because of private sector provision--occupational pensions.

As my hon. Friend the Member for Taunton (Mr. Nicholson) said, European comparisons no longer stand up to close examination because at the end of the 1980s the pensioner is much better off than he has ever been before.

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Of course there are exceptions to that, and that is why my right hon. Friend the Secretary of State was right, last October, to give extra benefis to those in most need.

The Government have the right approach to social security benefits. It is right to give the extra cash that is available to those who are most in need. That is why I welcome this series of orders. In particular, I welcome the new carers' premium and I especially welcome the fact that the attendance allowance is to be extended to babies under two. The abolition of the earnings rule last October was most welcome, as is the substantial improvement to be made in April by the Department of Social Security and the Ministry of Defence to the war widows' pensions.

On child benefit, too, it is right to look at the overall position of families. My right hon. Friend the Secretary of State gave the House an interesting piece of information. He told the House that, over the past 12 months, the average net income of a working man had increased by more than £20 a week. It is that that we need to look at when we consider child benefit.

If we compare the Government's record in just the past 12 months with the previous Labour Government's record, we can see why the policy announced by the hon. Member for Oldham, West is such a fraud. We all know that, if we have the misfortune to have another Labour Government, it is most unlikely that earnings will rise in the way that they did during the 1980s. Earnings will probably only just keep pace with prices, as they did under the previous Labour Government. Since there is no question of retrospection in the Opposition's proposal, it amounts to no more than a confidence trick.

When child benefit has been reviewed each autumn recently the Government have been right to say that the appropriate policy is to freeze it and to devote the extra resources to other benefits. But I also agree with my right hon. Friend the Member for Aylesbury, (Mr. Raison) that we need to come up with something better by the next election and to have a clearer policy. He suggested one alternative, which was to double child benefit and abolish the married man's tax allowance. He thought that the Government were inconsistent in introducing new tax allowances while at the same time freezing benefits.

Up to a point, I agree. I even took the trouble to come here last week to explain to the Treasury why I thought it was wrong to introduce a new tax relief for private health premiums. The Department should look carefully at my right hon. Friend's proposal, but other possibilities could be examined.

For example, it has been suggested that we could have a higher benefit for children under five and a lower benefit for children over five on the ground that it is during that first period that the mother is less likely to be at work, so it is then that the family is most likely to be in need of help. Against that, it could be argued that children get progressively more expensive, as I believe to be the case. That would suggest that the benefit should be the other way round.

It would be sensible to have a proper debate about how to proceed. It is not sensible simply to index-link child benefit year in, year out, when so many families that receive it do not need it. We need to come up with something better. I hope that my right hon. and hon. Friends in the Department will consider that and try to come up with something better. Subject to that, I welcome these orders.

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