Previous Section Home Page

Column 1002

Much of it is not administratively efficient, but wasteful. The National Audit Office report found that one third of the social fund's budget is spent on administration. The huge savings made by the computerisation programme are not being used to harmonise or improve the quality of the service. They have already been forfeited to the Treasury in staff cuts.

The priorities of current policy do not reflect need, they reflect dogma. This year, £1 billion is being spent on tax reliefs for personal pensions while the neediest are turned away from the social fund in their thousands. The poorest pensioners and low-income families with children are being made even worse off this year and specific benefits continue to be cut--notably statutory sick pay, the motion about which we will certainly vote against tonight. Britain now has the lowest pensions in Europe in cash terms and as a proportion of average income. The same applies to many other benefits.

After 12 years of Tory rule, poverty is again high on the political agenda as it shames the conscience of the nation. If the Government will not act to restore justice and decency in public life for all our citizens, the Labour party soon will after the general election. 5.13 pm

Miss Emma Nicholson (Torridge and Devon, West) : I will be brief, as my colleagues want to challenge the picture of deprivation painted so poignantly during the past 45 minutes by the hon. Member for Oldham, West (Mr. Meacher).

The hon. Member painted a poignant picture of an army of millions of paupers in the United Kingdom, with thousands of people who are beggared by an uncaring Conservative Government. The hon. Gentleman should come to my constituency and witness the outstanding, first-class social services provision provided by a superb committee from county hall, and by first- class social workers.

We have superb social workers in north Devon who care for the poorer elements in our society, of which there are many, because people regard the area as a Mecca. They come to live in Devon, but do not want to work. Instead, they try to live off the taxpayers in Devon.

If the hon. Member for Oldham, West visits my constituency, he will see that the way in which society comports itself, even when it is in difficulty in relation to income, is different from the picture that he painted.

Mr. David Nicholson (Taunton) : Will my hon. Friend give way?

Miss Emma Nicholson : I will give way to someone who is not a cousin, but who perhaps should be.

Mr. David Nicholson : Did my hon. Friend note that the amazing tirade from the hon. Member for Oldham, West (Mr. Meacher) was witnessed by a massive audience of only three Labour Back Benchers?

Miss Emma Nicholson : That always seems to happen when Opposition Members believe that they can rant and rave to maximum effect. However, they only do that to empty Opposition Benches. That always happens on Supply days. It is extraordinary that so few Opposition Members turn up.

I wonder whether the hon. Member for Oldham, West realises how much the age profile in this country and in

Column 1003

other western nations is changing. We have a rising age profile. We are all getting older and living longer because of the health and welfare services run by this Government. We are also working longer, because there is not such a strict ceiling on working. We are living to a healthier old age, but we are having fewer children. I am not making a political point ; I am trying to introduce realism into this debate, following the speech of the hon. Member for Oldham, West. As a result of the rising age profile, the growing band of old people must be supported by an ever-shrinking group of younger earning people. We should look most keenly at those people in terms of income. I have a large number of pensioners in my constituency, and there is a rising age profile in Devon. In fact, in that respect, we are in advance of the rest of the country. However, as we grow older, we will all need to be supported by younger people who are earning, and that proportion of people is smaller than it has ever been.

We should not think that pensioners today have paid for the totality of the health and welfare provision that they are receiving after retirement. They made the modest contributions that the state sought from them at the time. However, pensioners are now dipping into state benefits in a very big way, because so much more is available in terms of social benefits, and particularly in terms of health care, and the younger people are paying for that.

Mr. David Shaw : In the picture that my hon. Friend paints, does she agree that, with the expanding number of pensioners and a smaller group of young people supporting them, we would expect, with limited resources, to find falling living standards for pensioners? However, under this Government, the reverse is the case. More pensioners than ever before own consumer goods such as televisions, telephones and cookers. Under this Government, the total income of pensioners has increased to record levels.

Miss Nicholson : I agree. I have a note which tells me that, on average, between 1979 and 1987, pensioners' net incomes in total grew by 32 per cent. above inflation, which is more than five times faster than they grew under Labour, when there were fewer pensioners. It is important to strike a fair balance in society between pressure on younger earners and the proper welfare and health benefits that we offer the older recipients of those younger people's earnings. It is important to recognise that and not continually to ask unrealistically for full benefits across the spectrum of pensioners.

More and more of us have second pensions. As my right hon. Friend the Secretary of State rightly says, more and more people have a much wealthier life style than the word "pensioner" implies. According to the hon. Gentleman, when we think of pensioners, we might think of someone who is acutely poor. Yes, there are people who are pensioners and who are in poverty, and we must consider them even more rigorously than we have managed so far.

Most pensioners are far better off than pensioners have ever been. They should be well off, and they should be able to have holidays in Florida, colour televisions, two cars, and a longer, healthier and wealthier life. Let us not run away with the idea, however, that that is every pensioner in the United Kingdom--it most certainly is not. My right hon. Friend has struck a fair balance, which is difficult to find, between pressure on younger earners and benefits for older pensioners.

Column 1004

The hon. Gentleman remarked that the Government are not judged by little concessions. I agree--but nor were the previous Labour Government. However, my colleagues and I judge the current Labour Opposition by the proposed concessions that they disdainfully offer to the most needy group in our society, which must be those who are disabled, either mentally or physically. I am appalled that disabled people do not feature at all in Labour's priority social security pledges. They are just not there. They are an invisible element of society.

Two weeks ago, the right hon. and learned Member for Monklands, East (Mr. Smith), the Opposition spokesman on such matters, said that all promises to disabled people were contingent upon the capabilities of the economy. If disabled people are contingent upon the capabilities of the economy, and if the Labour party is in charge of the economy, there will be nothing for them.

Mr. Flynn : Having studied the regulations with some care, I know that the only way in which they are related to the disabled concerns the changes in the statutory sick pay legislation. The result will be that it is much more difficult for disabled people to get jobs.

Miss Nicholson : I refer to the excellent changes that my right hon. Friend the Secretary of State has offered for disabled people. I am delighted that my right hon. Friend the Minister for Social Security and Disabled People is on the Front Bench. Far from being uncaring and insensitive, my right hon. Friend treats the disabled on an equal basis, without the patronage that we frequently see in the Opposition.

I am delighted to note the increase in mobility allowance, for example. That is no minor concession. The Government have increased the mobility allowance in real terms by 550 per cent. since 1978-79. The number of recipients has increased six times--it is well over 0.5 million and it is approaching 0.75 million. Also, £4 million of new money has been allocated to include the deaf-blind, and double amputees will be included from April 1991, with a new grant of £1 million to Motability to convert cars.

Those are not concessions ; they are ways of providing independence of thought, mobility, and accessibility to the disabled. That is what counts. They are a huge group of people. By any account, they are people in need. They genuinely cannot help themselves. They are very unlike the family in my constituency of whom I was reminded when we heard from Opposition Members about all the beggars in the United Kingdom. Indeed, three generations of one family--the grandfather and grandmother, father and mother, and now the children--are now living off the state. Not once has any member of that entire family done a job. They are beggars par excellence. Would hon. Members give more to such a family?

It is acutely important that we give independence of thought, life and ability to work to the disabled. I am therefore very excited that we have now given far more money to help people to go to work if they are disabled. That is an important point, because the number of disabled people is rising. The Government instituted the first study of how many disabled people there are in the United Kingdom and of what their disabilities are. Also, there is a consultation paper, and we on the Select Committee on Employment did a special study and recently published our findings. The Government have

Column 1005

proved their credentials time and time again to that most needy group in society. It is enormously important for employment and employment prospects for the disabled that matters such as the mobility allowance are taken into account and uprated as they have been.

I strenuously welcomed the establishment of the independent living fund. I am delighted that its funding for 1991-92 has almost doubled compared with that of the current financial year. The fund has the flexibility which is the hallmark of the Government's treatment not only of the disabled but of those on lower incomes. Provision can be tailored finely to meet individual needs. Treatment is sensitive, and people are interviewed in their own homes.

We now see the real divide between the Government and the Opposition. The blanket coverage that the Opposition desire and constantly demand for everyone in the United Kingdom whom they define in a patriarchal manner as in need is 1 million light years away from the truly thoughtful, sensitive, intelligent and accurate pinpointing of need by the Conservative Government. I believe that I have made my case in talking about what the Government have done for the disabled in this uprating, and I support my right hon. Friend the Secretary of State.

5.26 pm

Mr. Frank Field (Birkenhead) : Unlike the hon. Member for Torridge and Devon, West (Miss Nicholson), I shall speak briefly, because, if the House will forgive me, I have a meeting at 5.30 pm. Also, unlike the hon. Lady, I have two points to make, and they are about the orders. Before the hon. Lady makes too much of the independent living fund, I bring her bad news. I share her views about the fund, but it is the Government's intention to chop the scheme when community care is introduced. If she wants to conduct a little campaign, many Opposition Members would join her.

First, I refer to fees for residential care. Over the past 10 years we have witnessed a massive change from hospital care for our very elderly citizens to care in private residential nursing homes. That would not have mattered if the costs were not borne by some families. Many of my constituents not only fought through two world wars but, unlike the beggar family whom the hon. Lady frequently mentioned, worked every year that they could work, paid their contributions and expected that, at the end of their working lives, they would be looked after--if need be, in hospital.

Now, in all our constituencies, some homes refuse access to constituents on benefits. The Minister for Social Security and Disabled People may have seen the citizens advice bureau report which shows that, in some areas, no homes are taking constituents who are on income support. We have changed from a situation in which our older citizens could have expected care in hospital--I am not saying that that was a desirable aim, but there were no bills--to one in which people should be cared for in residential homes, and we are now finding that an increasing number are refused entry because they cannot pay.

Also, an increasing group of constituents--pensioners--are being asked to pay a contribution to their parents' fees in nursing homes or residential homes. As the Minister knows, some of his hon. Friends can give him examples of contributions of about £25 per week being made to meet

Column 1006

their parents' fees from the children's pensions. We shall shortly reach the stage where some of our constituents will face eviction. I know that the Government hope that, before that stage is reached, they will have managed to hand over that entire responsibility to the local authorities--although some of us may use the word "dumped". However, it is not a good enough policy for the Government to hope that time will be on their side and that that responsibility will not be theirs, but one for the local authorities to accept.

I hope that, with the help of the careful information that he will have been given by his hon. Friends on the Treasury Bench, the Minister will to some extent share with the House his thoughts on this matter. We may be faced with evictions, and we should debate this issue now, rather than wait until it is raised in an emergency debate once evictions occur.

I am grateful for the increases that the orders make. They are necessary and go some of the way, although not the whole way, that we have been seeking.

In the single minute left to me, I shall concentrate on the second issue that I wish to raise, child benefit. As my hon. Friend the Member for Oldham, West (Mr. Meacher) said, we now have a new regime. The upratings relate to the old regime. I do not want in any way to detract from the credit that must go to the Government team for getting through this botched measure, because, although it is indeed botched, that is not its importance. What is important is that, when getting the increase through, the old regime was nailed to a commitment to continue child benefit. All hon. Members are grateful to the Treasury Bench for achieving that.

However, there are now some difficulties with the child benefit scheme, about which I asked a serious question, but did not receive a serious answer. Both the Tory party and the Government are debating the future shape of the scheme. It is right that there should be such a debate in those two organisations, but it should be more open. Between 7 million and 8 million mothers draw child benefit every week. I do not think that the Government should conduct a review about the future shape of the child benefit scheme, guaranteeing that child benefit should remain, but wanting to debate the way in which the money is spent, in private, without including mothers or some of their representatives who are among my hon. Friends

Mr. Peter Bottomley : And among my hon. Friends.

Mr. Field : Yes, and among Conservative Members.

In his reply, perhaps the Minister could give us some idea about the way in which the Government see the future shape of the child benefit scheme. We do not want the old patter, which states that it will be there for ever. We are grateful for that, and we know that we are in a new situation. We want to take the debate further. As a result of the Minister being open and honest with us, we might have a really good debate in the country as a whole about what mothers would like the future shape of child benefit to be, instead of about what a few Ministers or Members of Parliament would like.

I said that I would be brief, and I have already taken two minutes longer than I set myself, but I wanted to raise not only the issue of the future shape of child benefit but also, despite the Government's brave talk about how much more money is being allocated to cover the costs of

Column 1007

residential care, the real problems of residential care provision, to which we shall have to face up before frail and elderly people are evicted on to the streets.

5.33 pm

Sir Anthony Durant (Reading, West) : My hon. Friend the Member for Torridge and Devon, West (Miss Nicholson) said that the Opposition's proposals do not mention disability. I must correct my hon. Friend and advise her that the Opposition document refers to a scheme for a new disability benefit. However, what the Opposition have not told anybody is how much it would cost or how it would be introduced. We do not know how the Opposition's proposals will work and we have not been given any costings. Nevertheless, as disability benefit is mentioned in one of the Labour party's documents, I must correct my hon. Friend.

The Government's record on pensions is not bad at all. Pensioners' total incomes are up by 32 per cent., on average--and it is total income that matters to pensioners, not the amount of state pension, which is a different issue altogether.

There are three types of pensioner and the differences between them are growing daily. The first group comprises the 50 per cent. of all pensioners who now have a second pension. Indeed, more than 70 per cent. of people currently retiring now have second pensions, many of which are substantial. Those people have quite a good life. On top of that, the Government have legislated to ensure that private pensions should be automatically increased by 3 per cent. per year to take account of the inflationary spiral. That, too, will help pensioners tremendously. Hon. Members of all parties have wished to ensure that people of pensionable age are well provided for.

The second group of pensioners comprises those who have low incomes and few resources but who live in a property that they own. Very often, those pensioners do not know how to get out of that property or what to do about it as it becomes run down. The Government should have taken more seriously what my hon. Friend the Member for Bournemouth, West (Mr. Butterfill) proposed to try to enable those pensioners to use some of the money tied up in their houses to do up the property and obtain some tax relief while so doing. They may wish to sell the property, or they may wish to continue living there, but in better conditions. That group of pensioners certainly exists in my constituency.

The third group of pensioners comprises the small and declining group who do not have a second pension and who depend solely on the state pension and other state benefits. They are the poor group in our society, and I accept that they exist. Although they are a diminishing number, they are getting more resentful. Many of them live in old people's homes, where people with second pensions may also be living, but rather more comfortably. As the state-dependent group does not have the same amount of money, pensioners in that group feel more aggrieved.

That is why I strongly support the Government's move to put money in that direction. The Government have started to do that, and the uprating proposes a further £78 million to increase the benefits for those on the lowest incomes. The right way to tackle pensions is to acknowledge that it is the total income which matters, not the basic pension.

Column 1008

The Labour party has promised an extra £5 per week for single pensioners, but it has not mentioned uprating the whole thing to put back the money that Opposition Members keep saying that pensioners have lost. They are careful not to promise that, because it would result in enormous bills, which they do not want. The Labour party has said that it will link the basic state pension to prices and incomes, as used to happen, but I wonder whether it will actually do that if it ever comes into office. Its promises on pensions do not always live up to expectations.

As I have said, we have three groups of pensioners. There are those now benefiting from a second pension, who are doing extremely well and are very comfortable. There are those who have problems with their houses, many of whom have low incomes and only a small amount of capital. Then there is the smaller group, which is declining all the time, which comprises those who are dependent on the basic state pension and other benefits. That is the group that we must assist and on which we must concentrate. The Government have started to do that, by providing a further £78 million today.

The Labour party always talks about looking after the poor and those on low incomes, but what really matters to pensioners is inflation and what always happens with a Labour Government--it will happen again if the Labour party takes office--is that inflation takes off. Inflation averaged 16 per cent. when Labour was last in office, which meant that pensions diminished in value. Pensioners would be unwise to think that they would get a better long-term deal from the Labour party. What it says sounds attractive and very nice, but the reality of the Labour party's last period in office was that inflation increased and pensions decreased. The present Government have a good record. I support what they are doing on pensions, and I am proud to sit on this side of the House and to be a member of the Conservative party.

5.39 pm

Mr. Archy Kirkwood (Roxburgh and Berwickshire) : I listened with interest to the hon. Member for Reading, West (Sir A. Durant). I understand and sympathise with the point that he made when he identified a group of poorest pensioners, which he described as small and diminishing. Although it may be a diminishing group, it is certainly not small. We should not make light--I appreciate that he did not seek to do so--of the problems that they face. What worries me more than anything else in the Government's policy is that they are not taking any steps to address the diminishing value of the state pension in relation to the income available to the rest of the earning community. I accept that it is a difficult matter which could involve large sums of money.

Irrespective of whether one believes that universal increases in benefits should be available to all, between now and the beginning of the next century the Government--whatever their colour--will have to address the fact that, year in and year out, the group of pensioners to whom the hon. Member for Reading, West referred is losing out in relation to the community fortunate enough to be in work. The hon. Gentleman said that the£78 million was welcome, and indeed it is, so far as it goes, but it does not begin to deal with the problem. This is not just a problem for the coming year, to which the orders relate, but one that pensioners have experienced for the past five years, and it will continue for the next 15, 20 or

Column 1009

25 years until all pensioners have second pensions. Everyone recognises that, when my generation comes to retire, people will have occupational pensions and second pensions, will own their own homes, and so on. There is indeed an urgent problem, but the hon. Gentleman is not right to say that the Government are addressing it adequately.

I wish to ask a few questions in the context of the background against which the orders are being introduced. I am worried by some of the admittedly anecdotal evidence from my casework and other sources that the problem of indebtedness is getting out of hand. The hon. Member for Oldham, West (Mr. Meacher) rightly mentioned debt, and the consequences of financial deregulation have had far-reaching effects throughout the economy in terms of monetary policy, banking and so on. One of the implications which is only now coming home to me fully is that people in dire financial circumstances can get hold of enormous amounts of credit without any security. Week in and week out, I see more and more evidence that that is exactly what is happening.

Even in my constituency, rent arrears are reaching worrying proportions. Poll tax arrears are also becoming extremely worrying. The House should remember that Scotland is a year ahead of the rest of the country. Mortgage repossessions throughout the country are further evidence of the debt problem. Fuel costs and water charges are exacerbating the debt problem. Welcome though the increases in the orders may be so far as they go, evidence is coming through that there is a real problem out there for a large section of the community and it has not been addressed by the Government. I have dealt substantially with the points about pensioners made by the hon. Member for Reading, West. I trust that the Government will not take the problems of pensioners lightly. The Government gave pensioners the Lawson bonus 18 months or two years ago. A one-off payment of £2.50 was made to certain elderly pensioners. I am not necessarily in favour of such piecemeal payments because the problems are more urgent and need a more strategic long-term approach and to be dealt with adequately. However, I hope that one-off payments are not off the agenda as an immediate way to bring some urgent relief to a section of our retired population.

As the hon. Member for Birkenhead (Mr. Field) said, there is a debate in the Conservative party and in the Government about child benefit. That is of fundamental importance. It is happening in my party, too. In the approach to a general election, parties reconsider their policies. I detect from the tone of the debate today that the general election is not far away because of the manner in which manifestos and statistics were traded across the Floor of the House. Luckily, most of the political ammunition goes above my head, so I propose to keep my head down for as long as I can. The debate on the future of child benefit is crucial. Some 7 million mothers receive it and £250 million is paid out. It is a major plank in any Government's policy.

If any fundamental changes are to be made, they should be debated in the open, as the hon. Member for Birkenhead said. Also, any changes that are to be made must be expressly included in party manifestos. In the recent past it has worried me that some of the social

Column 1010

security changes that we have witnessed were virtually not discussed during the general election campaign. That happened during the time of the present Administration, so my objection is targeted exclusively at the Conservative Government. My plea is that if there are to be changes in child benefit, they should be discussed openly beforehand and included explicitly in the election manifestos of all major political parties.

I have a series of short questions about the detail of some of the orders. I may have missed them, but I have not seen any published figures for the level of the social fund budget for the next financial year. I do not know when that will appear in the annual cycle of uprating statements, public expenditure announcements, White Papers, and so on. If the figure has not yet been published, I hope that the Government will do so shortly. Certainly, the grants and loans budget, even if it is only uprated in line with inflation, should be in the region of £230 million. My experience --I am sure that it is not unique--is that even that will not be enough to meet the demand. Certainly it is not enough to meet demand for community care grants and to move towards implementing the community care system of finance. The amounts paid in grants must be watched carefully during the period of these orders. I hope that consideration is being given to increasing significantly the community care grants within the social fund.

I cannot possibly make a speech on the uprating orders in relation to the social fund without saying a word about severe weather payments. We have been up hill and down dale since the beginning of the year on this. I understand perfectly that it is not an easy matter to deal with, and the Minister of State is on record as saying that a review is to be undertaken. I hope that the review will be undertaken quickly, because the experience during the recent unusually cold snap was not happy. Statistical evidence is beginning to filter through from reports that large numbers of people in Britain have suffered as a result of the cold weather this year and that that was not an accident. That needs to be addressed as a matter of urgency.

We may see substantial, indeed swingeing, increases in the level of the poll tax in the near future. I do not want to get into a battle about who is responsible--

The Minister for Social Security and Disabled People (Mr. Nicholas Scott) : Before the hon. Gentleman goes on to his next point, I remind him that I am committed to reviewing the cold weather payments. He said that many people had suffered. We deemed the whole country as qualifying to trigger the cold weather payment during the period of the most excessive cold, and we made the necessary payments. I should be grateful if the hon. Gentleman would give me as much evidence as he has to assist my review. I want to listen to the constituency experiences of all hon. Members. If the hon. Gentleman will let me have any evidence that he has, I will take it into account.

Mr. Kirkwood : I take the spirit of that intervention as helpful. I was referring to the statistical evidence that our mortality rates during the winter months are worse than in other countries. I accept that the whole country was entitled to cold weather payment. That was welcome, but there was some confusion about the way in which the payment was introduced.

Column 1011

With regard to increases in the community charge, the House will know that in 1988-89 the Government compensated people on benefit for having to pay 20 per cent. of their community charge or poll tax. Substantial increases in poll tax are in the pipeline in Scotland--I do not know about other parts of the country--far in excess of any compensation that the Government ever envisaged. The Government decided to increase benefits by about £1.30 per week to compensate for the 20 per cent. payment. That will have to be reassessed in view of the current level of increases in community charge that people face, especially as water charges are not rebateable at all. In Scotland, water rate charges have certainly been spiralling. Even with the recent relief scheme for the community charge, benefit increases do not compensate for the basic increases that have to be paid. If the Government could identify the level of compensation within income support that is earmarked to address the extra amounts that poll tax payers and water charge payers have to meet, that would help. The Government may not have realised that poll tax and water charges would spiral.

The Audit Commission report said that one of the most cost-effective things that the Government could do would be to sweep away the 80 per cent. enforced ceiling on rebates, because the net benefit annually to the average person paying a 20 per cent. poll tax contribution is £6, while the net collection cost is £15. It would save money if the Government did away with the 20 per cent. enforced contribution.

I support everything that the hon. Member for Birkenhead (Mr. Field) said about residential charges. The Price Waterhouse report suggested that Scotland was the second most expensive area outside London for ordinary residential charges ; I am not talking about charges in nursing homes or specialist homes. The increase of £5 in residential home fees is not enough. I have evidence of friends, neighbours and family having to contribute in order to meet residential home charges.

I hope that the Government will do something about national insurance benefits for fishermen. I was given the opportunity to raise the issue by the Secretary of State's announcement about a change in class 2 payments. I welcome that, because it has been a bone of contention in the recent past for fishermen. The change in the weekly earnings rule, coupled with the new lower earnings limit, puts fishermen at a disadvantage in terms of unemployment benefit, particularly if half the eight day tie-up is in one week and the other half in the second week. Fishermen can earn enough in the working days of both weeks to take them out of benefit. That is an unfair consequence of the recent benefit changes, and I hope that the Government will review it.

In relation to non-dependant deductions on applicable amounts for housing benefit, can someone tell me why there have never been stiff increases? According to my arithmetic, the increase is 25 per cent. The sums were done by me, so they may be suspect. So far as I can see, however, the non- dependant deductions at the higher level have gone up from £10.85 to £13.50--a 25 per cent. increase. Even at the lower level there is a 25 per cent. increase--from £4.55 to £5.70. I do not understand that, and I would welcome clarification.

I have come across the case of two 19-year-old non-dependants with someone who was claiming housing benefit. I do not know what average local authority rents

Column 1012

are in other parts of the country, but £27 per week is the about average in my area. If two non-dependant 19- year-olds both get assessed at £13.50, it means that the householder will be deprived of all housing benefit and will have to meet the full rent. If the non-dependants happen to be unemployed, that produces further financial and domestic problems. I do not understand why there should be a 25 per cent. hike when there are much lower increases in other areas. Is there a different way of calculating the non-dependant deductions? If so, I am unaware of it. I should like clarification. I do not think that the Government's announcement and these upratings do anything other than the Government are statutorily obliged to do. There may have been small increases and insofar as there have been increases, I welcome them, but we need something more if the Government are to show that they recognise the stark financial reality faced by many poor pensioners and families.

5.53 pm

Mr. John Bowis (Battersea) : I am pleased to support my right hon. Friend's proposals in the package of upratings of benefits. It is yet another step forward by the Government in looking after people who need our support. I had hoped that the debate would have been a serious discussion, with observations from both sides of the House on how to improve benefits still further, bring in new schemes, enhance existing ones and so on. Although I exempt the hon. Members for Roxborough and Berwickshire (Mr. Kirkwood) and Birkenhead (Mr. Field), who spoke briefly, I cannot exempt the hon. Member for Oldham, West (Mr. Meacher) from the charge of not really being interested in the welfare of the people we are seeking to help. He was much more interested in trying to make party political points in what he presumably sees as the run-up to a general election in the not too distant future.

The hon. Gentleman's speech was amazingly disappointing. I can only imagine that he looked at the proposals before him, realised that his party when in power had not produced such ideas, and tried to camouflage the fact that it had come up with nothing in the past and had no credible policies for the future. When one meets people who are in need or those who look after them, one hears of great respect for my right hon. Friends the Secretary of State and the Minister of State who is responsible for people with disability. One does not hear much about the hon. Member for Oldham, West ; having heard him today, we understand why.

The Government cannot solve overnight the problems of all the people in need. They have never claimed to do so, but when they perceive a problem and understand it, they bring forward solutions. Under the Conservative Government, we have had a remarkable and sustained improvement in the living standards of people in the groups about which we have been talking.

One has only to consider the overall position of pensioners. Of course one can find individual pensioners who have not done as well as others, but the broad band of pensioners have been much better off under the Government, partly because of the improvement in the economy, partly because of the Government's ability to

Column 1013

get inflation under control and partly because of the benefits in cash and in kind that older people have received from the Government.

Pensioners are better off to the tune of over 30 per cent. in real terms since the Government came into power. That is the result of a combination of factors. Pensioners' income from savings has gone up phenomenally because of high interest rates. Occasionally, pensioners slightly regret a tumble in interest rates. Nevertheless, low inflation and sound investments mean that pensioners have done better from their savings. They have also done considerably better from occupational pensions.

Is it possible to tabulate comparisons with our friends and neighbours in the European Community? One often hears misleading statements about how we compare with other countries. In any given figures, the comparison is often of like with unlike. Perhaps the spouse is not covered by a non- contributory pension in the other country, whereas that spouse is covered here. Perhaps the comparison does not take account of benefits in kind from local or national Government. It would be helpful to have real comparisons instead of occasionally misleading statistical ones.

I am always ready to press my right hon. Friends to go further on that category of pensioner who is just above benefit level and tends to miss out. I do so for good reason, because I spoke about that in my maiden speech. Such pensioners do not get the basic benefit, and, on top of that, they miss out on consequential benefits. I am especially pleased that, this year, the Government have introduced an additional benefit for those pensioners on low income who receive enough from that income to be judged above the benefit level. I am sure that the extra £1 a week will help such pensioners, but I urge my right hon. Friends to go further.

It is good to note that the problems associated with child benefit are being solved. I refer to that tentatively as I remember the days when our late colleague, Sir Brandon Rhys Williams, tabled an amendment to Government policy to ensure that we did not forget the aims behind child benefit--to help children judged to be in need, especially those who may not be caught by other benefits. I supported the change advocated by Sir Brandon, and I am pleased to note that the Government have now found it possible to increase the benefit for the first child. I hope that they will continue to study how further improvements could be made--for example, benefits for children under five. Certainly there are merits in that.

I am conscious of the need to consider other ways in which to improve the income of families with children. The measures taken to encourage fathers who have deserted their families to make a contribution is welcome.

I am pleased to note the proposals on nursing and residential homes. The Price Waterhouse factor has, I am sure, led to the additional support for nursing homes in the uprating. The extra £45 per week, together with the London supplement, is welcome. I am also pleased to note the emphasis given to centres geared to people with alcohol and drug-related problems. I pressed for such improvements some months ago for the Davies centre, which is part of the Turning Point group. That centre helps

Column 1014

people who have come out of detoxification units to go back into the community and without such support those people would find that difficult.

The Government should consider, however, voluntary hospices and the contributions that they invite, but do not demand, from their patients. Department of Social Security offices have disallowed those contributions to be taken as supplements to income support. I know the arguments about that, but that is a hard ruling, as it requires the voluntary hospice movement to make a charge when it has not done so previously. That ruling has affected people with a short lifespan. Many hospices are reluctant to make that charge, so they are losing out.

The House has a particular duty to look after people with disabilities. I welcome the various measures that have already been introduced, but it is important to continue to consider the various problems associated with living and coping with disability, mobility and the ability to work. I pay tribute to my right hon. Friend the Minister of State for creating the independent living fund and I hope that, whatever the future may bring, that scheme, or something like it, will continue. I especially welcome the fact that that fund has been doubled this year. The improvements in invalidity care allowance, motability and mobility allowances are also welcome.

People with disabilities are always close to our hearts when we consider policy. We have reached the stage where we no longer lock away people with disabilities ; rather, we encourage them and enable them to come into the community. Children with disabilities are no longer automatically sent to special schools or colleges--we have enabled them to join mainstream schools and colleges. People with disabilities now work in shops, offices, factories and even in this House. Those people no longer work in enclosed workshops in residential homes. We have enabled people to get to work under their own steam so that they do not have to wait to be wheeled out from their homes. We have enabled people to nurture hopes and ambitions to achieve things with their lives. The carers allowance also means that we look after those who look after people with disabilities. If we accept that there is nothing that people with disabilities cannot achieve if the House, Government and nation so enable as a result of various measures, such as the allowances we are discussing today, we shall do right by them and by all the others for whom we have a duty of care.

6.5 pm

Mr. Paul Flynn (Newport-West) : Sir Thomas Beecham used to refer to the encores that he gave at the end of his concerts as "musical lollipops". They were always pieces of music that were light and attractive, but there was no great substance to them. Since the new Prime Minister took over, we have seen the advent of political lollipops. At various Question Times, the Prime Minister--the Secretary of State for Social Security did the same today--has contrived to award such a lollipop to the waiting, admiring population. Those lollipops have a mammouth publicity value, but are protozoan in terms of the money they represent.

Today the Secretary of State announced an incease of £10,000, equivalent to a 50 per cent. increase, in the award to the parents of vaccine-damaged children. That money will go to about five families a year, so the amount

Column 1015

awarded is microscopic in terms of the available budget. Those families have suffered a particularly harrowing experience. Part of the grief felt by the parents for a dead child is guilt. That feeling is especially harrowing in the case of vaccine-damaged children, because the parents took a deliberate decision--with no blame to themselves--that resulted in that damage.

Everyone will welcome the award to those parents, but we are entitled to display some cynicism about it. The uprating of that award is below the level of earnings at which it should have been set--it is possibly above the level of inflation--and it is significant only because it applies to a small number of children. In other cases, tens of thousands, even millions, of children are involved, but there has been no such generosity or uprating.

One of the most important changes has been that to child benefit--rightly described as a "botch-up". I agree with my hon. Friend the Member for Birkenhead (Mr. Field) that it is good to see the log-jam broken, and that that benefit will no longer be allowed to wither on the vine. The £1 increase for the first child--it is not in the uprating order, but in separate regulations--is slightly more than the going rate of benefit. For the first child, that extra £1 is more than the 10.9 per cent. allowed for inflation for a one-child family, but the increase is less than that 10.9 per cent. for a two-child family--10.9 per cent. of £14.50 is £1.58. Those families are losing when one takes into account the inflation rate. The larger the family, the greater the shortfall. A four- child family would need £3.16 to compensate for inflation, but they shall receive only £1. All lone parents not getting means-tested benefits will lose, including those with only one child. A one-parent family with one child now gets £7.25 plus £5.60 one-parent benefit, which is not being increased--a total of £12.85. The uprating on that amount would have been £1.40, and lone parents will only receive an extra £1. Therefore, a one-parent family with two children would need an extra £2.19 to compensate for inflation, but will receive just £1. The reduction in the child dependency allowance increases by £1 per week per family to deprive them of the extra £1 benefit. There will not be four or five such payments a year, but 192,000. That is not included in the uprating order, but will be achieved subsequently by regulation. However, the order covers the partner's earning limits, above which the child dependency increases cease to be payable. They are to be increased in line with prices, when they should obviously be increased in line with earnings. They were introduced in 1984, when the limit was set at £80 for the first child, plus £10 for each subsequent child. Since then, average earnings have risen by 70 per cent., so the limit should now be £136, plus £17 for each additional child. Instead, the new limit will be £110, plus £14--a significant cut.

The £1,000 widow's payment remains the same, but there are not four or five widows in the country, but tens of thousands, possibly hundreds of thousands of widows who regularly claim benefit, which has been frozen for the third year running. It has been frozen for nearly six years since it was announced in June 1985--and it was not introduced until April 1988. It replaced the former widow's allowance, which used to be paid at a higher rate than other widows' benefits for the first six months of widowhood. If the widow's allowance had not been abolished, it would have increased over that period from £50.10 a week to £72.80--an increase of 45 per cent. On

Column 1016

that basis, the £1,000 should now be £1,450--the Government have made enormous savings by cutting the amount given to widows. In Committee, Social Security Ministers take an affable approach ; we all find them persuasive and want to believe what we are told. But it is interesting to recall that, when the widow's allowance was replaced by a lump sum widow's payment in 1986, the present Secretary of State resisted an amendment providing for automatic annual increases and told the Standing Committee :

"When the final decisions on all rates of the new benefits under the Bill are taken in the autumn of 1987, we shall obviously consider whether it would be appropriate to change the level of widow's benefit stated in the Bill."--[ Official Report, Standing Committee B, 17 April 1986 ; c. 1439.]

Will the Minister say why it has not been considered appropriate to change the important benefit given to widows? In 1986, the Committee might well have taken a different view of the proposal if the Minister had admitted that the £1,000 payment was to be frozen indefinitely.

Although most of the means-tested benefit rates are increasing in line with prices--excluding the housing benefits--the disregards are not. In particular, the £3,000 capital disregard has been frozen, not only since it was introduced in 1988, but since it was announced in 1985 in a Green Paper on the reform of social security. Merely to compensate for price increases since then, the benefit should be not £3,000, but £4,350.

All these increases are subtle and hidden, they are not obvious. They are not introduced with a blare of trumpets and trombones from the Dispatch Box, but they represent deep cuts. Similarly, since it was increased in November 1983 the £500 capital limit for social fund payments has been frozen for everyone except those aged 60 or over. It was then the capital limit for single payments under the supplementary benefit regulations. Since then, prices have risen by more than 50 per cent., so the limit should be more than £750 just to keep pace with inflation, let alone with earnings.

The child benefit regulations provide £1 extra for the single family. I remember in another Committee discussing a comment by Beveridge, when he talked about certain anomalies and said he hoped that they were buried for ever and would never again rise from their dishonoured grave, but for us, another little nasty has been resurrected by that extra £1. An important advantage of child benefit compared to the pre-1976 system of family allowance is that it is payable at the same rate for every child in the family. The family allowance excluded the first child, and complicated rules were needed to decide, if parents were separated--unhappily, an increasing occurrence--whether the two children were members of the same family or different families.

The extra £1 reintroduces those complications, since it is payable only to the first child. Hence the incomprehensible provisions of regulation 2(b), about which I have written to the Minister--I longingly await his reply. If my interpretation of the regulation is correct, it will, in some cases, disqualify both parents from receiving the extra £1, which is obviously nonsense and cannot be the intention.

Further anomalies arise from the statutory sick pay regulations, upon which we shall vote tonight, and I believe that they will be the subject of a speech by my hon. Friend the Member for Nottingham, North (Mr. Allen).

Tonight, Social Security Ministers are working their old magic like the old illusionists they are and providing, up

Next Section

  Home Page