House of Commons Hansard Debates for 14 Jun 1990

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put on to the statute book regulations to ensure that that happened. They were also Members when, sadly, the Government abolished the link between earnings and prices, using whichever was the most favourable to claimants, and thus ensured that during a period of record economic growth those at the bottom did not participate in the way in which the hon. Member for Macclesfield described.

If all hon. Members who wish to take part in the debate are to get in, we must be disciplined and limit ourselves to about 10 minutes, so I end with three further questions, and I hope that in the Minister's 10-minute reply he will give a hint of an answer. First, the Minister is in a superior position to the rest of us, except for his right hon. Friend the Secretary of State for Social Security, whom we welcome to the debate, in that he has seen the results of the data concerning living standards between 1985 and 1987. Would we be right in thinking that one reason why the Government have not published those figures relating to the period up to 1987 is that the results for the poorest show an even worse outcome than the revised figures that the Select Committee published for 1981 to 1985?

Secondly, given that the biggest reforms since Beveridge--that is how the Government billed them--were introduced by income support in 1988, will the Government undertake a special analysis of the data for that year so that we can see who gained, who lost and how effective that whole policy review was?

If the Government say that their resources are limited and their statisticians overworked, and similar circumstances with which we can sympathise, may I ask them, thirdly, as the Conservatives favour contracting out, to consider contracting out the whole of this operation to the Institute of Fiscal Studies? Not only might that result in fewer mistakes, but, considering the performance of the institute, we would have the results much sooner. Might that be the reason why the Government do not want to go in for a bit of privatisation on this front?

8.43 pm

Sir David Price (Eastleigh) : I support the general thrust of what the hon. Member for Birkenhead (Mr. Field) said. The House will recognise that he was speaking as Chairman of the Select Committee on Social Services. As such, he should--I am sure that he does--command the respect and attention of the House. The hon. Gentleman was so comprehensive in his remarks that I can be mercifully brief. I have only one general point to make. It is that the more accurate measurement of low incomes is essential to the implementation of this or any other Government's social policies. For many years it has been agreed across the party spectrum that there should be a floor in society below which nobody--I emphasise "nobody"-- should be allowed to fall.

I remind my hon. Friends that we in the Conservative party have been committed to such a proposition certainly since the wartime coalition Government and their 1944 White Papers, and many could argue, much earlier. In "The Right Road for Britain," a policy statement of our party in 1950, we said :

"The social services are no longer, even in theory, a form of poor relief. They are a co-operative system of mutual aid

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and self-help provided by the whole nation and designed to give to all the basic minimum of security, of housing, of opportunity, of employment and of living standards"--

I ask the House to mark the following words--

"below which our duty to one another forbids us to permit anyone to fall."

"The Right Road for Britain" was only a spelling out of what our then leader, Winston Churchill, declared to our Brighton party conference in 1947, which I attended, when he said :

"The scheme of society for which we stand is the establishment and maintenance of a basic minimum standard of life and labour below which a man or woman of goodwill, however old and weak, will not be allowed to fall."

The obvious question which arises from such clear social purposes is how we collectively, as a society, set and then monitor that basic minimum standard. That is the issue before us tonight.

The current mechanism by which we deliver financial assistance to those at the lowest levels of the income scale is income support and housing benefit, following, historically, supplementary benefit. But how are we to know whether that income support is at any moment set at a level sufficient to achieve that purpose? How do we know when it is failing because it is insufficient? Are there any objective measures by which income levels can be set? Is that an impossible statistical exercise? Must we be content with more subjective factors to determine minimum income?

I confess that I seek some objective measure which all can recognise and accept as a fair description of minimum income at any moment, an objective measure that is resistant to political disputation. Perhaps I express a faint and distant hope. But only by that means can we do right by the poorest of our fellow citizens. As the great Lord Kelvin stated :

"When you can measure what you are speaking of, and express it in numbers, you know that of which you are discoursing. But when you cannot measure it, and express it in numbers, your knowledge is of a very meagre and unsatisfactory kind."

None of those who study these matters would claim that current figures are very meagre. That would be a reckless assertion. But I hope that we can all recognise that they are far from fully satisfactory. The hon. Member for Birkenhead began to illustrate their unsatisfactory nature.

As I see it, the current discussion about how to measure low income--some would say how to measure poverty--is a choice between using social security benefit or using some defined point in the distribution of income. The second key issue, whichever yardstick is chosen, is what can be bought at that level of income--in other words, what standard of living that income permits.

The third issue is who is living at or below that standard of living--what are the composition and characteristics of the lowest income groups? Are they permanent groups or do people move in and out? The use of social security benefit scales, as the hon. Member for Birkenhead said, has an obvious appeal because there is a clear policy relationship. To some extent, the scales represent the levels of living for others that we as a community are willing to pay for. Therefore, there is an obvious interest in how people are faring in relation to those income levels. Their use also means that the choice of that cut-off point does not lie solely with the interpreter of the figures, although

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there has been some disagreement about whether the appropriate cut-off point is 100 per cent. of the scale, 110 per cent. or 120 per cent.

However, the benefit scales approach can be positively misleading. As the hon. Member for Birkenhead said, Ministers and officials have, for at least 20 years, made that, point by saying that if benefit rates are increased, the effect is to raise the number of people in poverty. Equally, if benefits fall relative to the incomes of the rest of the population, the use of benefit scales as a yardstick will mask an underlying increase in poverty. In some ways, by using that yardstick, one can determine how great the poverty is, rather than the reality of the poverty.

The value of a criterion based on a particular point on the distribution of income has the advantage of allowing the effect of policy changes to be examined. But that depends on the criterion chosen. A crude choice would focus on, for example, the bottom 10 or 20 per cent. on the income scale. But as there will always be a bottom 10 or 20 per cent., such a choice is not of itself illuminating. That is why the usual choice in such an analysis is to examine the numbers or characteristics of people below a particular proportion of the average in the distribution of income. That approach runs into the objection that it is not a measure of poverty or low income, but of inequality in the distribution of income. Therefore, both the favoured measures seem to have major disadvantages.

I hope that I have said enough to demonstrate to the House the difficulty of measuring low incomes accurately, and why the current measures are not totally satisfactory for determining the floor in society that all hon. Members are determined to achieve. That is why we on the Select Committee have been encouraging further examination of the issues and why, next month, we shall hold a seminar to try to advance the issue. I hope that we have the fullest approval of the House for a noble cause--improving the lot of the poorest of our fellow citizens.

8.54 pm

Mr. Michael Meacher (Oldham, West) : The hon. Member for Eastleigh (Sir D. Price) has postulated a noble and worthy objective. The only problem is that the Government have not delivered it--indeed many Opposition Members would say that they never had any intention of doing so. I do not say that about the hon. Member for Eastleigh, but I certainly say it about the Government.

I wish to start my remarks constructively. We all agree that the House owes a considerable debt of gratitude to the Select Committee on Social Services for its report. I pay warm tribute to my hon. Friend the Member for Birkenhead (Mr. Field), who chaired the Committee, and all its members for so strikingly bringing to light a dark corner of this nation's life about which there has been so much obfuscation and deception. It showed the Select Committee system at its best, and I offer unstinting praise to all its members who have persevered to discover the truth and publish it. I recognise that it had a Conservative majority.

The report puts poverty squarely back on the political agenda. The Government have striven vigorously, by every trick in the book, to prevent that. First, they denied that it even existed. In 1986, the right hon. Member for Chingford (Mr. Tebbit), obviously an authority on the subject, judging from his string of City directorships, said :

"Poverty is just not an issue."

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The Prime Minister said in the House :

"Everyone in the nation has benefited from the increased prosperity-- everyone."--[ Official Report, 17 May 1988 ; Vol. 133, c. 801.]

When the Government could deny the existence of poverty no longer, they decided to muddy the ground by altering the basis of the statistics. A good maxim of this Government is always, "If the facts are embarrassing, change the method of calculation." They have done so repeatedly, most notably with the unemployment figures, which have been changed no fewer than 27 times. But they still cannot get the figure lower than the one they inherited in 1979. They have also done so by massaging the trade figures, culling the hospital waiting lists and, most recently, trying to fiddle the retail prices index. There have never been a Government who have so shamelessly doctored the figures. It is well known that there are many senior officials in the Government's statistical service who are deeply unhappy at the political abuse of their professional services.

The Minister for Social Security (Mr. Nicholas Scott) : Not true.

Mr. Meacher : It is well known, and has certainly been widely reported. If the Minister wishes to challenge it, I shall send him the evidence on which I base my remark.

In the same vein, as poverty mounted in the mid-1980s, the Government announced a technical review of the methodology of calculating the level of poverty. The review reported in 1988--just in time, because at the same time, the 1985 low-income families' figures were published showing startling increases in the number of people living on the lowest incomes. Therefore, using the review as an excuse, the Government promptly shut down the statistical series that produced such embarrassing results.

I hope that it is not unfair to say that the Government's motto is clearly, "If you can't beat them, close them down." I suppose that is roughly the Prime Minister's attitude to the Greater London council. The Government's new line was that supplementary benefit rate should no longer be used as the benchmark of poverty, for the reasons given by the hon. Member for Eastleigh. They said that in future the yardstick would be average earnings, and those below various fixed proportions of average earnings, and those below various fixed proportions of average earnings.

That approach is flawed in three ways. First, the Government closed down the first statistical series in 1985, which the review committee never recommended. It is impossible to have continuity in estimates of poverty throughout the 1980s. The Government have succeeded well in blurring the comparison of what happened in the first half of the decade with what has happened in the second half.

Secondly, the new statistical series produced a howler, as we know, that was convenient for the Government. Far from admitting the huge increase in poverty that was taking place, the Government used the new figures to claim that the poor were becoming better off at twice the rate of those on average income, as my hon. Friend the Member for Birkenhead said. That is such an absurd mistake that one cannot help wondering, as my hon. Friend did, whether it owed more to politics than to arithmetic. However, I suppose that we must accept that it was an official error. Like my hon. Friend, I would simply add that, if Ministers did not immediately regard such a

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conclusion as totally contrary to all practical experience as unemployment tripled in the mid-1980s, and did not then immediately demand that the figures should be rechecked, their judgment loses all credibility.

The third flaw in the Government's approach is that, having produced a new statistical framework that was not only discontinuous with what went before but started life with a palpable falsehood, they are publishing no information at all on the subject. In 1979, the low-income family figures were published every year. Today, poverty statistics are five years out of date. The 1987 figures of households having below-average incomes were promised before last Christmas, then early in the new year, then before Easter. They have still not been published. If the Government expect revised poll tax assessments for millions of people to be processed and dispatched within a matter of weeks, failing still to produce poverty statistics that are now three years out of date smells more of political deviousness than administrative incompetence.

What is so contemptible about the Government's response is that, while they reject the traditional definition of poverty--and I understand the objections--they refuse to produce any definition of their own. It is not difficult to understand why. Whatever definition one chooses, poverty has sharply increased over the past decade. Suppose that one adopts the traditional definition based on those living on, below, or only just above the supplementary benefit line. That is a reasonable definition, because it represents the minimum income on which Parliament expects people to live. It is also a distinctly conservative definition. Today's income support rate for an adult over 25 is £36.70, or £57.60 for a couple. Compare that with today's average wage of £295 per week, according to the Government's figures.

That means that a single adult on supplementary benefit has to survive on one eighth of the average wage, and a couple on less than one fifth. I wonder how many right hon. and hon. Members, and particularly the Tory Members to whom I am addressing this remark, could live on such a small income for a week, let alone for months or years on end. One former Conservative Member, Matthew Parris, could not manage to do so when he tried.

Taking even an extremely meagre definition of poverty, it is a matter for urgent attention on this country's political agenda that, in 1979, 4 million people were living on supplementary benefit but by 1985, there were 7 million. In 1979, a further 2 million people were living below the supplementary benefit level, but by 1985 the figure had risen to 2.5 million.

Because supplementary benefit involved entitlement to single payments for such items as bedding and fridges, until the former Secretary of State abolished them in the infamous Fowler reviews, and because such items are worth up to 40 per cent. of basic supplementary benefit rates, it is relevant that, in 1979, a total of 5.5 million people were living just 40 per cent. above the supplementary benefit line, but by 1985 the figure had risen to 6 million.

By a highly conservative definition of poverty, by 1985 an extra 4 million people, making a total of 15.5 million, were living on extremely low incomes. That is about one in four of the population, according to the Government's own figures. It is particularly worrying that the number of children living below the supplementary benefit line nearly doubled in the six years to 1985, to 2.5 million. That puts an entirely different gloss on the upbeat picture that the

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Prime Minister so often and so misleadingly paints, when she says that average earnings have increased by 31 per cent. since 1979. The right hon. Lady omits to mention that that increase is confined to those in work and excludes all who cannot work and who are dependent on benefits. They account for one third of the whole nation. The Prime Minister also manages to avoid mentioning that that group has increased--not decreased--by as much as one third under her regime, and she has been forced to eat her words that the poorest one tenth of the population have enjoyed a rise in their real living standards of double the average. As we now know, the actual rise of 2 per cent. per year is little more than one third of the national average. Even that 2 per cent. is an average figure covering 5 million people, which suggests that large numbers of them have almost certainly enjoyed no increase. In other words, there has been a growth in absolute poverty during the Government's first six years. We continually talk about percentage increases for this group or that group. At the risk of sounding banal, let me point out that people do not buy things in shops with percentages ; they pay money. The Government's use of percentages is a gross concealment of what is happening in our society. Let me give three examples.

The Government have now been forced to admit that the poorest tenth of the population have had an average income rise of 2 per cent. a year ; the average worker--the Government are constantly complaining--is receiving a rise of 9.5 per cent. ; but a recent survey in The Guardian showed that the chairmen of Britain's top 100 companies paid themselves a 33 per cent. increase last year. That implies that the average worker did four times better than the lowest-paid tenth of the population, and that the top chairmen did four times better than the average worker ; but that is not the case. The percentages are calculated on completely different bases. Those percentages actually mean that the poorest tenth of the population have been receiving about a 70p rise a week and the average worker a rise of £27 a week, but that Britain's top chairmen have been paying themselves rises that average £2,400 a week.

The Government should stop their pretence that ours is a percentages society. They should stop veiling the reality of inequality in Britain today and spell out the facts of poverty in pounds and pence, which everyone can understand and with which everyone can identify. If they will not do that, it is because they do not want the truth to be known, but Opposition Members do. In future, we shall regularly give the straight money facts about poverty and wealth in cash figures for all to see.

The Government last published figures five years ago. It is a scandal that they have shut down the low income family series, thus depriving us of the only comprehensive data that analyse the performance of social security and its ability to provide an income safety net for those in need. That, of course, is precisely why the Government shut it down. Nevertheless, despite all the Government's attempts to conceal, there are pointers to what has been happening post-1985.

I am sure that all hon. Members take the point so nicely made by my hon. Friend the Member for Birkenhead about privatising, but there is one form of it that we would

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all favour. It was the Institute for Fiscal Studies that exposed the Government's howler pre-1985, and it has now produced estimates for 1987 on a similar basis to the low-income family series. It found that the number of people in families living on, below or no more than 40 per cent. above the poverty line had risen to 18.5 million- -7 million more than in 1979. What makes that all the more remarkable is that it was after the longest burst of economic growth since the war, as the former Chancellor--who is not known for his modesty--constantly reminds us. On that basis, one wonders what is happening now, when the economy is in stagnation and on the brink of recession. For more than a century, Governments have been keeping an annual check on the position of low-paid workers. Throughout that century, with monotonous consistency, the lowest- paid tenth have maintained their pay at 65 or 66 per cent. of the national average : that was exactly the position in 1979. Today their pay has been cut to 58 per cent.--probably the lowest relative position that low-paid workers have held for 100 years.

We have a two-thirds/one-third society with a vengeance. The wealthy have been showered with gains beyond the dreams of avarice ; the middle two thirds--at least until the poll tax and bruising interest rates--have done well ; whereas for the bottom third--we must not forget that that means nearly 20 million people--there has been unrelieved disaster.

Poverty, however one defines it, has been sharply on the increase in the past decade. To deny it, misrepresent it, conceal it and then ignore it-- which has been the Government's response--may be the cynical politics of complacency, but there are clear signs that that is distasteful to an increasing majority of the electorate. As the recession bites and unemployment rises, I predict that poverty will rise on the political agenda. That is one more reason why the Government's days are numbered.

Several Hon. Members rose --

Mr. Speaker : Order. I draw the attention of the House to the fact that this debate has to end at 10 o'clock and that quite a number of hon. Members wish to participate. If they confine their speeches to six minutes each, that will enable more hon. Members to be called and allow time for the Minister to speak.

9.12 pm

Mr. Barry Field (Isle of Wight) : I do not feel tempted to follow the argument of the hon. Member for Oldham, West (Mr. Meacher) although I think that he introduced a rather specious note into a debate that was getting on rather well. To put the lie to his claim that the Government wish to sweep things under the carpet, I have a letter from the Central Statistical Office, dated 12 December 1989, signed by Mr. T. Griffin, which came about as a result of work done by Martin Lloyd, the managing director of the Isle of Wight development board, and some parliamentary questions which I asked about the gross domestic product of the island. The Central Statistical Office has agreed that the island, along with the border regions of Scotland which were previously grouped with Lothian, should have distinct statistics for GDP.

Lest anyone come to the debate with the spurious view that these issues affect only areas other than the south-east, may I say that the Isle of Wight, which I represent, has a

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GDP which is 77 per cent. of the United Kingdom average and the highest seasonal unemployment in the United Kingdom.

I do not know whether my hon. Friend the Minister for Social Security will find my contribution helpful or enlightening. My hon. Friend the Member for Eastleigh (Sir D. Price) put his finger on it when he said words to the effect, "Some hopes that we will ever debate this subject and agree on a definition."

I want to draw to the Minister's attention the fact that the Rural Development Commission, in conjunction with the Isle of Wight development board, has funded a study by Ernst Young, the first stage of which has just been completed, and deals with the curent economic position of the island and its evolution over the past decade. The study shows that, although the economy has grown substantially, reflecting the expansion of our manufacturing and service base, we are still 25 per cent. behind the United Kingdom and 33 per cent. behind the rest of the south-east. When we study the figures, an extraordinary situation is revealed. The study has only just been published and we are awaiting phases two and three to enable us to create an economic strategy for the island. It reveals that, while the average gross weekly full-time male earnings on the island are substantially below those in Hampshire and the United Kingdom as a whole, car ownership, which is generally taken as a reliable indicator or personal wealth, is much above the average for the United Kingdom. That is the point that I wish to draw to the attention of my hon. Friend the Minister.

There is a continual contradiction within our local economy on the Isle of Wight : for some years we have worn the badge of low wages, without the consequent economic deprivation, and we score "Z" factors in local government terms.

The degree of hardship that one might have expected to find, given the level of wages, is absent. Although there is a seasonal level of unemployment, the black economy has to be taken into account, but I am far from certain as to how it can be measured. It will not divide the House either politically or in any other way if I say that my constituency is an economy in its own right.

The excellent report from Ernst Young, with two additional phases to come, may be more constructive than what was said by the hon. Member for Oldham, West in his harangue. The Isle of Wight might be an appropriate place in which to look further at the problem of defining statistics. Both my hon. Friend and I know that there are "lies, damned lies and statistics."

The extraordinary feature of the Isle of Wight is that wages are low, though home ownership and car ownership are well above average. That is incompatible with wage levels on the Isle of Wight and the level of economic activity.

9.16 pm

Mr. Archy Kirkwood (Roxburgh and Berwickshire) : The House will forgive me if I do not follow the wholly economics-driven argument advanced by the hon. Member for Isle of Wight (Mr. Field). This is an important debate. I echo the tributes that have been paid to the Select Committee for the valuable work that it has done. I agree with the hon. Member for Oldham, West (Mr. Meacher) that this is exactly how Select Committees should work and that the Government ought to be cross-examined rigorously about these important subjects.

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There is a danger of getting too hung up on methodology--of concentrating too much on statistics and forgetting that human beings are the object of the exercise : to make life better for those at the bottom of the financial league table.

Most of my points are derived unashamedly from the Select Committee report. For obvious reasons, I am anxious that more information should be provided on a regional basis. There would be difficulties over sample statistics in the case of the English regions and the nations of Wales and Scotland. There is a big difference between the economy in the south of the country and that in the highlands and islands, the borders and Wales. Living standards are quite different. Temperature plays its part, as do transport costs. There are many other significant factors.

I wholeheartedly endorse, therefore, the plea for more information to be made available on a regional basis. The Department made a limp excuse in the memorandum that it submitted to the Select Committee. It said that it would cost too much money to do that, but then it said that it would cost about £100,000. If the Department of Social Security wishes to guard itself against the charge of massaging the figures and hiding the truth, it would do itself a favour if it provided statistics on a regional basis.

I agree with the hon. Member for Eastleigh (Sir D. Price) that it is important to know exactly who the poorest members of the community are--not just the numbers but the composition of the group. Do the poorest 10 per cent. of the population stay in the lowest decile or do people pass through it? Is there a pattern? That information is vital in determining Government policy.

The Select Committee drew attention to the impact of benefit and the extent to which the incomes of the lowest 10 per cent. of the population are determined by benefit. Nearly 2.3 million people have been on long-term benefit for more than three years. They represent a significant group of people and we must turn our attention to help them more in future if these debates are to mean anything. It is also important to study the impact of the 1988 changes. The Select Committee was right to say that the combination of the introduction of water rates being charged at the full level and the 20 per cent. contribution to local government finance--offset by the £1.30 flat rate one-off payment--have made a significant impact. My constituency casework has reflected that. The statisticians will have to consider that as a matter of some urgency. The Select Committee was right to say that the living standards of the poorest 10 per cent. in the community have fallen by about 5 per cent. as a direct result of those changes. If that is true, the Government should address that matter urgently.

The Select Committee correctly identified housing tenure as a factor that needed attention. Housing costs--particularly for single elderly pensioners in my constituency--are becoming a much bigger proportion of people's income.

There are difficulties in measuring poverty, and I am sure that the Select Committee is right to carry out a longer-term study on minimum income. I hope that I can get a ticket to the seminar and I also hope that the tickets are free. The longer-term study is a valuable piece of work, if only to concentrate the Department's mind. The fact that the Department has someone at its shoulder will keep its mind concentrated, especially as the Select Committee is so capable and has access to so much expert advice.

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Explicit income levels that may well require subjective and in some cases arbitrary judgments are necessary, even case by case, to establish a target, an objective or a standard by which other things can be measured. I agree entirely with the hon. Member for Birkenhead (Mr. Field) that setting poverty levels is a spurious game. In the past, Governments of both political complexions have run up against that problem. I hope that he will agree that the work that has been carried out by the family budget unit and some other organisations to put a real cost on people's economic situations is nothing but helpful. Of course we must be careful about how we use that information, but it provides a comparison with the level of benefit that we are offering claimants. I consider that, by that standard, benefits will be found inadequate, but that is not a new argument. The technical review that was carried out by the Department of Social Security was flawed because it did not take any independent advice whatsoever. It was an internal review. The Minister is looking shocked and horrified by that suggestion, but it would have been much better had the Department taken representations from outside experts. I am sure that the experts in the Department are reliable and technically sensible, but the results would have been accepted more readily had there been some input from elsewhere. There were a number of objections. The use of household incomes instead of family incomes was a mistake, and I entirely endorse the pleas that have been made from both sides of the House today that the new series and the old series of statistics should be run in parallel if we are to achieve any sensible comparisons throughout the decade.

The quality and timing of the statistics are a scandal. I do not know whose fault that is and I am not trying to make a cheap party political point. However, not to have data available for five years on such a crucial issue of public policy is indefensible. I do not know what the statistical problems are. I understand that the family expenditure survey takes a wee while to generate and that the figures are drawn from that. However, it is not acceptable that it has taken so long to produce information that is so essential to any Government's promulgation of sensible policy in this area. 9.25 pm

Mr. Nicholas Winterton (Macclesfield) : I will accept your advice, Mr. Speaker, to be brief. There is one area in which I am in agreement with the hon. Member for Oldham, West (Mr. Meacher), which is that the activity of the Select Committee on Social Services displays the work of the Select Committees at its best. The Select Committees do an excellent job. They are a most important part of this House and it is clear to me how important they are when we say to the House that we have spotted a major discrepancy in Government figures which clearly has had a bearing on Government policy. The Government have accepted with a good grace that they are wrong, and it is most unfortunate that the hon. Member for Oldham, West did not pay tribute to my right hon. Friend the Minister of State for his outstanding work. I am often critical of my party's Government, but I believe that the hon. Member for Oldham, West could have praised my right hon. Friend for his excellent work since

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he has held his present office. On all occasions, he has done his best to represent the interests of those for whom he is responsible and to improve the benefits payable.

I also give the same praise to my right hon. Friend the Secretary of State for Social Security. I have known him in the House for many years. He has given outstanding service to the Department of Social Security and I only regret that he was not placed in his present position sooner to bring his guidance and dynamism to the job. I am convinced that he will do a great deal more good.

The hon. Member for Birkenhead (Mr. Field), who is Chairman of the Select Committee on Social Services, inspired us to take on our inquiry into minimum income statistics and he was right to do so. The Select Committee has provided a fine service to the House. Four major themes came from the contribution of the hon. Member for Birkenhead and from the excellent contribution of my hon. Friend the Member for Eastleigh (Sir D. Price). They referred to the errors in the low income statistics and to the policy implications of those errors, which the Select Committee discovered and highlighted. They also spoke of how best to measure poverty/low income and about the trends in poverty/low income in recent years. I do not want to go over the ground that has been covered so capably by my hon. Friend the Member for Eastleigh and by the hon. Member for Birkenhead. I wish to point out to Ministers that there are problems facing us today. There are people who have not benefited from the fairly substantial growth from which so many have benefited. The hon. Member for Oldham, West pointed out that the greater percentage of people have benefited from the improvement in economic growth over the past 11 years. However, some people in my constituency are falling deeper and deeper into debt.

As the hon. Member for Birkenhead knows, my area has seen tremendous strides made in recent years. We have had immense economic improvement in our area and it is scarcely recognisable compared with what it was 20 years ago. I have seen an immense improvement since I have been the Member of Parliament for Macclesfield. [Laughter.] I must say to the hon. Members for Roxburgh and Berwickshire (Mr. Kirkwood) and for Caernarfon (Mr. Wigley) that I do not claim full credit for the improvements, although I claim some of it. However, I still have some objectives to achieve before I finally hang up my political boots.

For a limited number of people in my area, the problems are becoming so acute that the citizens' advice bureau has had to employ a debt counsellor for the first time ever. That finding is highlighted in the CAB's annual report, and the bureau believes that, sadly, there is worse to come. The report said :

"Some consider that the problem is confined to the feckless, but experience shows that money difficulties are being experienced across the social strata."

The list includes people who have fallen into multiple and single debt and those who cannot pay fuel bills, rent and rates, and, in severe cases, some who face bankruptcy.

The bureau manager, Liz Goodman, says that at least one new person every day seeks help from the Macclesfield advice bureau : "It is getting out of hand. It spills over into family problems"-- I find this sad, and I am sure that the hon. Member for Birkenhead shares my concern--

"marriage problems and also alcohol problems."

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Mrs. Goodman said that people on social security were finding life very difficult for a number of reasons because of the changes in the benefits system which took place in 1988.

I have full confidence in the objectives that the Government have set themselves. I agree that we should target those who need help and give them more generous help, but let us also realise that the Government's objectives have not yet been achieved in the policies that they have implemented.

I have been a member of the Select Committee for many years and I am concerned about what is happening. The Committee has done a valuable job in highlighting certain areas of concern, such as the need for more accurate statistics. I endorse the comments of the hon. Member for Birkenhead about that, which were taken up by my hon. Friend the Member for Eastleigh. Let us use the expertise of the Institute of Fiscal Studies to produce accurate statistics which the House and the Government can use in developing social security policy.

My hon. Friend the Member for Eastleigh quoted Sir Winston Churchill. It was Sir Winston Churchill who talked about the importance of the welfare state as the net below the ladder of life, which was there so that those who slipped off the ladder, through no fault of their own, could rely upon an adequate standard of living and adequate support from the state. As a Conservative, I hope that that is what we shall achieve.

9.32 pm

Ms. Mildred Gordon (Bow and Poplar) : I represent Bow and Poplar in the borough of Tower Hamlets and unfortunately my constituency contains many poor people, a number of whom are in the lowest income brackets. The policies of this Government have dramatically increased their problems over the past 10 years, and no amount of statistical manipulation or massaging of the figures can disguise that stark fact. Every Friday evening at my surgery, men and women weep when they tell me of the problems they have in managing on very low incomes.

In the current edition of the "Households Below Average Income" report, published in May 1988, the Government claimed that there had been an increase of 8.4 per cent. in real terms in the incomes of the bottom 10 per cent. of the population. This was found to be untrue by the research of the Institute of Fiscal Studies, which showed an increase of only 2.6 per cent. Moreover, the noted social scientist, Peter Townsend, using data from the Department of Employment, demonstrated that there had, in fact, been a decrease, rather than an increase, in the incomes of the bottom 10 per cent. of the population. That has not been refuted.

The evidence is there for all to see. Young people can be found begging in every major city in the country, and the Victorian problems of child prostitution and hunger remain. Hon. Members need only take a short walk down to the south bank to cardboard city to see for themselves the reality behind the statistics, if they have the will to do so. They would see the human tragedies behind the report that we are considering tonight.

The statistics speak loudly of the injustice and the Government's failure. Between 1979 and 1985, the number of families on low incomes rose from 6 million to more than 9 million--a rise of more than 3 million. According

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to the fourth report of the Social Services Select Committee, in 1988 the proportion of families--with children--on or below the supplementary benefit level increased from 15 per cent. to 20 per cent. between 1979 and 1985.

The Government's response to that increase in poverty has not been to introduce policies to help poor people, but to stop collecting the figures. Furthermore, they have frozen child benefit and many mothers with no independent incomes are now having to cut household spending to pay their poll tax. One of the little-mentioned effects of the poll tax has been to rearrange finances and resources within the family, leaving men with more money in their pockets and women with less. We rarely find poor children with mothers who have money to spare, but more often find poor children whose fathers might have money to jingle in their pockets.

The Government argue that people on income support levels and below are relatively poor and not absolutely poor. However, relative to what? Perhaps it is relative to freezing or starving. On the other hand, Peter Townsend defines poverty as being a level of income so low that one is excluded in all kinds of ways from the normal activities of the community in which one lives. That is the kind of poverty that requires people to count every teabag they use. It takes a terrible toll in stress, which undermines health and personal relations between people. Insecurity and constant worry about every penny make life a misery for men and women alike, and the work burden for women is massively increased.

It is fortunate that members of the Social Service Select Committee were not satisfied with the Government's failure to produce the necessary statistics and commissioned research from the Institute of Fiscal Studies. The institute's provisional figures show that the number of people in families on low incomes increased to at least 10 million by 1987. The indications are that further research will probably reveal an increase to 12 million--a colossal figure. As we have heard, the official figures are not available because the Government, who talk so piously about the individual and pay lip service to the family, have decided that individuals and families are not important when counting people who live in poverty. The Government now want to make the household the unit of measure. The Government how appear to believe that every person in the household will share out their income equally. That flies in the face of reality. Does any hon. Member believe that, on a Friday night, all the members of a household sit round a table, put their money in the middle and divide it up equally and fairly? That does not happen. The Government are preparing the ground for a return to the pre-Beveridge 1930s household means test. That is what is behind the changes and that is what is really happening.

The response of the Department of Social Security to the massive increase in poverty has been to insult poor people. On 11 May 1989, in the St. Stephen's club, the then Secretary of State for Social Security, the right hon. Member for Croydon, Central (Mr. Moore) delivered a speech entitled "The End of the Line of Poverty" in which he airily claimed that poverty no longer existed. That speech proved to be the end of the line for his ministerial career. Unfortunately, poverty did not disappear so easily.

On 15 June 1988 Mr. Hickey, the assistant secretary for policy on family benefit and low income at the Department

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