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Mr. Scott : No, I am afraid that I have not yet had the chance to have my daily read of The Scotsman. I should in any case disagree with Mr. McGregor, although I am a considerable fan of the contribution that he makes in Scotland, and particularly to the workings of the Disability Income Group, but that is not an accurate description of the social fund. It is a mixture of loans and grants--2.5 million loans and 500,000 grants have been given so far. As I think that hon. Gentleman knows, in some 35,000 cases in 1989-90, those who applied for loans were in practice given grants because it was thought that that was more appropriate.
Dame Elaine Kellett-Bowman : Does my right hon. Friend agree that, under its previous rules, the social fund was escalating out of all control? Is he aware that my local office in Lancaster is operating within proper bounds and has had no problems in operating the new rules?
Mr. Scott : I agree with my hon. Friend. Single payments were running at £40 million in 1979-80 and had risen to £335 million by 1985-86. I do not believe that single payments in the old form would have been sustainable, whatever party was in government, and the social fund has proved to be flexible and fair.
Mr. Frank Field : Is the Minister aware that some of my constituents who have literally nothing, not even a single stick of furniture, are refused help from the social fund? Does he consider that to be satisfactory, and if he does not, what does he propose to do about it?
Mr. Scott : The vast majority of those who are turned down for community care grants are turned down because they do not fulfil the basic eligibility conditions for community care grants.
Mr. Field : They have nothing.
Mr. Scott : The hon. Gentleman will no doubt write to me about individual cases as they come to his notice. He knows that, in the longer run, we are looking forward to the result of the work that is being done for us by the social policy research unit at York. We shall then be able to have
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a proper assessment, on a clear and broad statistical basis, of whether the social fund is fulfilling the needs for which it was established.Community Charge
2. Mr. Pike : To ask the Secretary of State for Social Security whether he proposes to make any changes in the regulations for poll tax rebates.
The Secretary of State for Social Security (Mr. Tony Newton) : We are currently consulting the local authority associations on regulations for changes to the community charge benefit scheme from next April, largely of a technical nature, and on two other instruments relating to subsidy matters.
Mr. Pike : Does the Secretary of State accept that we want changes that are more than of a technical nature, because, until the poll tax is scrapped, we need to improve the rebate system to help those least able to pay it? Welcome steps would include abolition of the need to pay 20 per cent., an increase of the level at which rebates are payable and changing the tariff income on savings.
Mr. Newton : The hon. Gentleman will be aware that, during the introduction of the community charge benefit scheme, the taper was made substantially more generous than under the old rate rebate scheme, which extended help a good deal further up the income scale. My right hon. Friend the then Chancellor of the Exchequer, now Prime Minister, made a significant improvement in the capital rules at the time of the Budget.
Mr. Jacques Arnold : Is not it the case that half the people receiving community charge rebate receive a discount rate of 80 per cent., which is no small beer? Is not the remaining 20 per cent. no more than the cost of a pint of beer a week?
Mr. Newton : Certainly, many of those receiving community charge benefit--including all those who are on income support--receive an 80 per cent. rebate.
Mr. Kirkwood : May I press the Secretary of State on the 20 per cent. community charge? A cause of some of the worst hardship in my constituency is the abolition of the old 100 per cent. rate rebate and the introduction of the 80 per cent. maximum rebate that is available to community charge payers. Is the rebate for community charge payers part of the review? Is it possible that it will be abolished as well as the poll tax?
Mr. Newton : Rebates, or community charge benefit, as it currently is, follow on from the consideration that my right hon. Friend the Secretary of State for the Environment is giving to the system in a wider sense. The hon. Gentleman knows that the basis of the present arrangement is the view that it is right that everyone should make a contribution. Benefit rates were adjusted to take account of that when the scheme was introduced.
National Insurance
3. Mr. Paice : To ask the Secretary of State for Social Security what would be the cost to business if employers' national insurance contributions were levied at 5 per cent. on all employees with earnings below the national insurance threshold.
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The Parliamentary Under-Secretary of State for Social Security (Mr. Michael Jack) : On the limited information available, I estimate thecost to employers at around £200 million a year in national insurance contributions. In addition, employers would have to bear substantial administrative costs from the extra record keeping involved.
Mr. Paice : May I first, say that it is a great pleasure for me to be able to welcome my hon. Friend to his new ministerial position, which brings him to the Government Front Bench--[ Hon. Members :-- "Hear, hear."] I count him as one of my most long-standing friends in this place. It is a great stroke of personal good fortune that I am able to congratulate him.
Is my hon. Friend aware that the burden of the £200 million to which he referred would fall especially heavily on businesses such as those that are run by horticultural growers and packers in my constituency, who rely on part-time and casual workers for their labour force? If the proposed Labour party tax on employers were to be implemented, it would mean that those businesses would lose their competitiveness and their work force, with the result that unemployment would increase even further.
Mr. Jack : I thank my hon. Friend for his generous and warm words of welcome to me at the Government Dispatch Box. I shall take up the more general point that arises from his comments and not respond directly to his question on agriculture. The proposal to amend national insurance contributions on the basis of the lower earnings limit would be a positive disincentive to the creation of part-time employment that is valued by so many, especially by women who want to return to the labour market.
Mr. Skinner : When will the Minister deal with the question that was raised by the Audit Commission and others about employers of various descriptions taking as much as £400 million out of the pockets of employees in tax and national insurance contributions and not handing them over to the tax authorities and Government Departments? When will the Government take steps to ensure that proper auditing takes place and that the money that is paid over by employees goes to the right accounts and not into employers' pockets?
Mr. Jack : The hon. Gentleman raises an extremely important issue. Efforts are being made to strengthen auditing procedures by the fraud investigation section of the Department. More inspectors are being employed, and I am certain that they will address themselves to the matters that the hon. Gentleman has drawn to my attention.
Pensioners
4. Mr. Janman : To ask the Secretary of State for Social Security what extra support has been directed to lower-income pensioners in the last two years.
The Parliamentary Under-Secretary of State for Social Security (Miss Ann Widdecombe) : Income-related benefits for pensioners have been increased substantially over the past two years. In addition to the normal annual upratings we directed an extra £200 million to less well-off elderly and disabled pensioners in October 1989 and will be directing an extra £80 million to pensioners aged 60 to 74
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from next April. Taken together, those increases will bring the total annual extra help for pensioners since October 1989 to over a quarter of a billion pounds.Mr. Janman : May I warmly welcome my hon. Friend to the Government Front Bench? She and I have had offices near to each other for the past three years.
May I congratulate my hon. Friend on her answer to my question? She will be well aware that there are some, including some Labour Members, who often try to imply that the United Kingdom is rather behind its European neighbours when it comes to support for the elderly. Will my hon. Friend confirm that that is far from the truth and that Britain is near the top of the league when it comes to supporting its elderly in terms of the percentage of public expenditure that is spent in that direction? Does my hon. Friend agree that any massive across-the-board increase, as proposed by the likes of the Pensioners Protection party, would not reach those who need help the most because of the loss of benefit entitlement that would occur if such a policy were pursued?
Miss Widdecombe : I thank my hon. Friend for his generous welcome. The real Pensioners Protection party is the party that has brought about a 31 per cent. growth in pensioners' income during its time in office. The European figures clearly demonstrate that the richer countries spend a larger share of national income on social protection. That underlines the Government's view that only a successful economy can generate the wealth to pay for the welfare state. There are aspects of the pension arrangements in other EEC countries that we would not welcome, such as the link with earnings, which means that low earners receive low pensions.
Mr. Winnick : Pensioners, and especially pensioner couples, have been cheated out of £20 a week because of the break in the link with earnings. Is the Minister aware of our deep concern about the health of so many poor pensioners who, at this very moment, are in great danger because they simply do not have sufficient financial means to heat their homes to an adequate level? Do not the Minister and the Secretary of State realise that the cold weather payment regulations are far too inflexible and bureaucratic? Is not it absolutely scandalous that millions of pensioners on small incomes are forced to live in inadequately heated homes because they are denied any extra help from the Government? When will the Government take action on that?
Miss Widdecombe : It is because we recognise the importance of pensioners--and, indeed, others--being able to heat their homes adequately that there have been many reviews of cold weather payments. We made improvements in the winters of both 1988-89 and 1989-90. We are now having further consultations with the Meteorological Office about weather station areas because there are local variations that need to be examined.
Miss Widdecombe : I cannot believe that those who are trying to heat their homes in some of the areas most severely affected would share the amusement of the hon. Member for Walsall, North (Mr. Winnick) about that process.
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Mr. Winnick : It is not amusement. I am furious.
Mr. Andrew Mitchell : Has my hon. Friend noted that next year all pensioners will receive a rise in their pensions in excess of the current level of inflation, and which by next April will be substantially in excess of inflation? Will not that be of great advantage to all pensioners, and especially those on lower incomes?
Miss Widdecombe : That rise, together with the uprating in income support, our review of cold weather payments and other measures, shows clearly that we are directing our resources to pensioners most in need. They will certainly benefit from the uprating--
Mr. Winnick : On a point of order, Mr. Speaker. If an hon. Member is described by the sort of term that one hon. Member has just used to describe me, should not that hon. Member be forced to withdraw?
Mr. Speaker : I did not hear anything disorderly.
Mr. Ron Davies : Further to that point of order, Mr. Speaker. I assure you that we all clearly heard the hon. Member for Gravesham (Mr. Arnold) refer to my hon. Friend the Member for Walsall, North (Mr. Winnick) as a rat. Will you confirm that that is an unparliamentary expression--
Mr. Speaker : Order. Did the hon. Member for Gravesham (Mr. Arnold) call the hon. Member for Walsall, North (Mr. Winnick) a rat?
Mr. Jacques Arnold : I made no such reference.
Mr. Speaker : I did not hear it.
Mr. Paice : Further to that point of order, Mr. Speaker. In order that the proceedings may continue, I withdraw the remark that you did not hear.
Ms. Short : I welcome the Minister to the Dispatch Box. As we shall be seeing rather more of each other now, I hope that she will manage to say something with which I can agree.
Will the hon. Lady confirm that the figures that she cited do not in any way make up for the massive cut in the value of pensions that the Government imposed when they broke the link with earnings? As my hon. Friend the Member for Walsall, North (Mr. Winnick) said, that amounts to £12 a week for a single pensioner and £20 a week for a pensioner couple. Is she aware that that is causing real hardship for many pensioners? Is she further aware that Labour is committed to restoring that link and to an immediate increase, in addition to the uprating, of £5 a week for a single pensioner and £8 a week for a pensioner couple?
Miss Widdecombe : Perhaps the House should be aware that the costs of restoring that link--about £6 billion--mean that the average employee would face an extra £2.78 on his national insurance contributions and his employer an extra £5.34. Before we believe that the restoration of a link with earnings would substantially improve a pensioner's lot, perhaps we should reflect on the fact that the Labour Government linked pensions with earnings and brought about a 20 per cent. increase, which was
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eroded to a mere 3 per cent. increase because of their other policies. Surely it is better to have a 31 per cent. increase in real terms than a 3 per cent. increase against a totally false base.Mr. Brazier : May I also extend a warm welcome to my hon. Friend at the Dispatch Box? I very much enjoyed campaigning with her on many issues. In supporting her view that the Government have a much better record than their predecessor in looking after less well-off pensioners, may I draw her attention to the plight of one particular group--pensioners who are on modest incomes but also have savings? I suggest that, although the increase in capital limits was welcome, so long as we have a concept of notional income, we shall have a marginal rate of benefit withdrawal that makes saving unattractive to people approaching retirement.
Miss Widdecombe : I thank my hon. Friend for his warm welcome. Although I have some sympathy with his concerns, I should point out to him that, through the notional tariff and taper, those with very small savings benefit. It would be difficult to persuade those with little savings and little income that it was right or socially equitable to exempt large savings completely.
Income Support
5. Mr. Ron Davies : To ask the Secretary of State for Social Security if he will make a statement on the current level of income support.
Mr. Newton : There are many levels of income support corresponding to the needs of particular groups, such as pensioners or families, and their individual circumstances. Our policy in replacing supplementary benefit was to create a clearer structure with a greater capacity to focus extra help on those most in need. Since 1988 we have given such extra help, over and above upratings, to families and children, disabled people, carers and pensioners.
Mr. Davies : I thank the Secretary of State for his answer. Is he aware that 87,000 households still have not had a penny increase in their benefit since 1987, despite inflation being 28 per cent. since then? Does the right hon. Gentleman realise that those people form a special case? If the Government are determined to make the poll tax marginally less offensive, why will not the right hon. Gentleman remove from those 87,000 households the liability to pay the 20 per cent. statutory minimum of their poll tax?
Mr. Newton : The hon. Gentleman understands the basis of the transitional protection, which was extended in 1988. I think that he will acknowledge that one of the many helpful effects of the substantial increase in benefit rates, which is to take place next April, is that it will considerably reduce the number of people who will then be subject to transitional protection.
Mrs. Roe : Does my right hon. Friend agree that income support is a much more flexible and effective way of targeting help towards vulnerable and needy groups than the old supplementary benefit system?
Mr. Newton : I very much agree and I suspect that that view is generally shared, even by those who wish beneift rates to be higher still.
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Mrs. Mahon : The Secretary of State will be aware that one group of people--youngsters over the age of 18 in full-time education that does not attract a grant--are excluded from income support and have no income whatever. What does the right hon. Gentleman propose to do about that group?
Mr. Newton : The hon. Lady understands the position clearly. The Government's view is that, generally, if it is thought right that someone should be supported while he pursues his education, that is a matter for the local education authorities, which have adequate powers.
Sick and Disabled People
6. Mr. Gregory : To ask the Secretary of State for Social Security what was the average annual real increase in spending on the long-term sick and disabled in the periods 1973-74 to 1978-79 and 1978-79 to 1989-90.
Mr. Scott : We have increased spending on the long-term sick and disabled by £4.1 billion in real terms over the past 11 years--an increase of 98 per cent.
Mr. Gregory : Now that my right hon. Friend has announced those excellent results, will he confirm that help for those who are disabled will be increased even further as a result of the steps announced in "The Way Ahead" earlier this year?
Mr. Scott : We are making progress in Committee on the Disability Living Allowance and Disability Working Allowance Bill, which will introduce those two benefits. Extra resources--over and above what was planned before we published "The Way Ahead"--will be spent in each year until the end of the decade.
Mr. Alfred Morris : Is the Minister aware that, for most disabled people, the last time Good King Wenceslas looked out was when their benefits were linked to average earnings? How much have the Government saved by breaking that link after 1979? Is not it totally unacceptable that the Minister makes no mention of the fact that the overwhelming majority of the increase in expenditure since 1979 has been for further beneficiaries of allowances introduced by the last Labour Government and their predecessors?
Mr. Scott : As I have said to the right hon. Gentleman more than once, he must surely welcome, as I do, the fact that we have extended the coverage of benefits--some of which were introduced by a former Labour Government. The same number of disabled people existed when a Labour Government were in office ; there was no sudden dramatic increase when we came to office. We have not only marketed the benefits and encouraged the highest possible take-up--in the teeth of some criticism from the hon. Member for Oldham, West (Mr. Meacher), I may add--but have substantially improved the coverage of attendance allowance, mobility allowance and invalid care allowance. In addition, we have introduced the carers' premium and added age-related benefits to the severe disablement allowance. In several significant ways, we have extended and improved the coverage of those benefits.
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Maintenance
7. Mr. Burns : To ask the Secretary of State for Social Security what is the average maintenance assessment under the current system ; and what is the average cost of supporting a mother and child through the benefit system.
Mr. Jack : The White Paper, "Children Come First", confirmed that the average award for child maintenance under the current system was £25 a week. About £2 billion a year in income support is currently paid to lone-parent families. The average payment is just over £50 per week. That figure is higher than it would otherwise be, because less than one quarter of lone parents on income support are receiving the maintenance that is their due.
Mr. Burns : Does my hon. Friend agree that that answer is clear evidence that more must be done on assessment and enforcement, to ensure that more absent fathers contribute to the upkeep of their children? What hope or help can he offer to a mother of two in my constituency who cannot receive the child support that a court has granted to her because her former husband has absconded to Australia and refuses to pay any money? That mother cannot take her former husband to court in Australia because she cannot get hold of his home address.
Mr. Jack : I congratulate my hon. Friend on pursuing his interest in the subject. He was one of the hon. Members who contributed, on his constituents' behalf, to the response to our White Paper "Children Come First". He is absolutely right that we need to deal more effectively and consistently with child maintenance. That is precisely why the Child Support Agency will be made the subject of a Bill for which we shall seek all-party support.
My hon. Friend asked about his constituent. He will be aware that liable relative work is already undertaken within the social security system. I cannot comment specifically on the case that he raised with me, but, if he cares to write to me, we shall do our best to assess it and to give advice. Finally, the new Child Support Agency will have powers to pursue people for maintenance liability wherever they go.
Mr. Flynn : Did the Minister see the report at the weekend by Anne Searle, the Birmingham child employment officer, which stated that the epidemic of child employment throughout the country stems not from children working because they want to, but from having to as a result of the low incomes of their families? Does he recall the case of a 12-year-old child who was discovered working an 11-hour shift in a bakery and the 15-year-old who was killed returning from her job selling kitchen equipment door to door? Is he aware that in a school in my constituency, 75 per cent. of the sixth form work part time and that half of them have jobs both at the weekends and during the week? Is not he concerned that that will lead to a deterioration in their health and that it is also a threat to their education?
Mr. Jack : The hon. Gentleman highlights the point about "Children Come First", whose aim is to ensure that when families should be receiving income in the form of maintenance, that money is obtained and given to them. We are aware of the problems about family income. That is why the White Paper, which I hope the hon. Gentleman has had an opportunity to read, pays particular attention to improving the availability of family credit for women
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who want to return to work and raise their income. That is why, in any maintenance payments that are obtained, the first £15 will be disregarded. We take the hon. Gentleman's points seriously, but I argue that "Children Come First" is a testament to the way in which we have approached the issue.Mr. Kilfedder : Does the Minister agree that the present system for the enforcement of maintenance orders is totally inadequate and that it is important that maintenance arrears should not be allowed to accumulate in the magistrates courts? Does he also agree that everything must be done to pursue the absent parent to ensure that he looks after his children and is responsible for their maintenance?
Mr. Jack : The hon. Gentleman has put his finger on the point that led to the publication of the White Paper. The Government realised that the present position was inconsistent. The liable relative work carried out by the Department of Social Security also needs bolstering. To that end, we are not simply waiting until the House, we hope, approves the Bill on child maintenance ; steps are already being taken to improve the liable relative work of the Department and to strengthen it through the legal enforcement Bill which is in the other place. We have also published in the White Paper a clear formula by which maintenance will be pursued and the amount of maintenance determined.
Ms. Short : I, too, welcome the hon. Gentleman to the Dispatch Box. Has he yet had time to read the National Audit Office report on lone parents which is very critical of his Department? Is he aware that the report shows that under this Government, the percentage of lone parents on means-tested benefits has grown from 38 per cent. to a shocking 72 per cent. and that the number of those receiving maintenance while on benefits has slumped from 50 to 23 per cent? Will the Minister take a fresh look at the issue and drop his colleagues' outrageous proposal to punish, with a 20 per cent. fine, women who are too frightened to name the absent parent and pursue him for maintenance? Will he instead attend to his Department's deficiencies that have led to the enormous slump in the number of women on benefits claiming maintenance?
Mr. Jack : I thank the hon. Lady for her warm words of welcome and I look forward to our exchanges across the Dispatch Box. However, her final point illustrates why "Children Come First" was published and the need for the Bill that will follow. Only 30 per cent. of lone mothers and 3 per cent. of lone fathers receive maintenance and that is precisely why we want to take action in that area.
We are aware of the sensitivities raised by the central part of the hon. Lady's question. As she will know, the period of consultation on those elements in the White Paper on which comments were invited ended last Friday. A number of organisations have drawn our attention to that important point. My right hon. Friend the Secretary of State has made it clear that he understands the sensitivities. He also understands that rape will be allowed as a reason for not fining people. However, there will be other issues and officers will be trained to deal with them sensitively. We are also taking into account in framing legislation the comments that have arisen from the consultations.
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Occupational Pensions
8. Mr. Cran : To ask the Secretary of State for Social Security what has been the change in real terms since 1979 of the value of income from occupational pensions.
Mr. Newton : Pensioners' incomes from occupational pensions grew by 77 per cent. in real terms between 1979 and 1987, the last year for which figures are available.
Mr. Cran : Does my right hon. Friend agree that pensioners are among the most deserving of groups and, alas, among the least powerful in our society? Does he agree further that, in financial terms, those who have occupational pension cover have done extremely well, but that, by definition, people with only state pension cover have done somewhat less well? Therefore, is not the way ahead for the Government and employers to continue to encourage occupational pensions and, for that matter, portable pensions, and in the interim to be particularly generous at the next uprating of the state retirement pension?
Mr. Newton : It is the aim of our policies--they have been successful--to encourage the continued development of occupational and personal pensions. In referring to the substantial growth in pensioners' average incomes that has taken place, largely as a result of increased occupational pensions, I have never shied away from acknowledging that quite a number of pensioners still have not benefited. That is precisely why, in October 1989, we steered additional help to those least well-off pensioners through the income support system ; we shall do so again next April.
Rev. Martin Smyth : Does the Secretary of State agree that some people on fixed occupational pensions have not benefited from the increase of latter years and that they may have been penalised most in the pension scheme? Has any study been done of that sector?
Mr. Newton : Some of that group will be among those, depending on how small their occupational pension is, who may benefit or have benefited from increases in income support rates. We sought to tackle the underlying problem in last year's Social Security Act, as the hon. Gentleman will remember, by extending the provisions requiring in many more circumstances the uprating of occupational pensions.
Mr. Favell : The group that suffers most from a high community charge is pensioners with small occupational pensions who are just over the capital or income limit. Those people are patently honest and nothing hurts them more than seeing others refuse to pay their community charge. Has not the time come to ensure that everybody registers for the community charge and to say that, unless they can prove that they are registered, they should not receive social benefit of any kind, whether it be child benefit, income support or any other?
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