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Mr. Speaker : No, I am not taking it. The shadow Leader of the House cannot ask me to hear a point of order from the Front Bench when I am not prepared to hear them from those on the Back Benches.
Dr. Cunningham : On a point of order, Mr. Speaker.
Mr. Speaker : No, I am sorry but I am not taking it until after the statement.
Dr. Cunningham : It arose out of business questions.
Mr. Speaker : It may have done.
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Type 23 Frigates
4.2 pm
The Secretary of State for Defence (Mr. Tom King) : With permission, Mr. Speaker, I wish to make a statement on a further order for type 23 frigates.
The type 23 frigate will form the backbone of the Royal Navy anti-submarine surface force in the future and is, in addition, a highly capable all-round warship. Four are already in service and six more are under construction. In June we invited tenders for up to three more frigates. The benefit of our competitive tendering policy was clearly shown in the extremely keen prices offered, which are significantly lower in real terms than previous ships. The benefits of privatisation of the yards and the greatly improved productivity now ensure better value for money for our own defence expenditure and help the yards themselves to compete once again overseas, as the opportunities with Malaysia and Oman have shown.
Before I turn to the outcome of the competition, I remind the House that the contract with the shipbuilder is for less than half the total estimated cost of the frigates. The larger part is made up by the host of specialised equipments that such a frigate contains. For some of those, contracts have yet to be awarded. But some are already known ; for instance, the ships' 4.5 in gun will be ordered from VSEL--Vickers Shipbuilding and Engineering Limited--in Barrow, the machinery control equipment from Vosper Thornycroft in Porchester, the vertical launch Sea Wolf missiles from British Aerospace in Bristol. The two Spey gas turbine engines for each ship will be ordered from Rolls-Royce at Coventry, main gearing from GEC, Rugby and diesel generators from Paxman Diesels at Colchester. The shipbuilder will itself also have many sub-contractors. Hundreds of firms across the United Kingdom, large and small, will benefit from this order over the next few years, and its value will approach about £400 million.
On the results of the competition, I can tell the House that the tenders produced a winner by a very clear margin. We have accordingly decided to place a fixed-price contract for three type 23 frigates with Yarrow Shipbuilders on the Clyde. The construction of the first ship will start in the second half of this year. These ships will join the Duke class and will be named HMS Somerset, HMS Grafton and HMS Sutherland.
This is very good news for Glasgow, for Scotland as a whole, and for all the companies involved throughout the country. I recognise that it is, equally, a disappointment for the other yards which had tendered for the work, and for the people in those areas. However, this type 23 order is but one part of a substantial on-going programme of vessels for the Royal Navy. This will include a new anti-air warfare frigate, a second batch of Trafalgar class submarines and other significant vessels to ensure that we maintain a modern and effective navy in the future.
This order brings to 13 the number of type 23 frigates ordered since 1984, and the number of vessels ordered for the Royal Navy since 1979 to 71. It is yet more evidence that the Government are committed to ensuring the capability of the Royal Navy's fleet and to the wider aim of ensuring that our forces of the future have the modern equipment that they need.
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Mr. Martin O'Neill (Clackmannan) : I thank the Secretary of State for his welcome statement, made with great promptness, given the time scale. I offer my congratulations to the workers and management of Yarrow, who have picked themselves up after the bitter disappointment of losing the last order, despite having built the first of class and many of the subsequent ships.Can the Secretary of State give the fabrication start date, an important issue for the progress of work for the yard and for the timetabling of entry into service? What does the right hon. Gentleman consider to be the size of the fleet? It has been postulated at "around 40". Perhaps he is now in a position to be more precise. When will the tendering process be opened for the craft to which he referred in his statement? That must be of great concern to the yards which were not successful in the tendering process, whose problems will become similar to those that confronted Yarrow until this afternoon. When does the right hon. Gentleman expect the next tranche of type 23 orders, to which he did not refer in his statement, to be in the pipeline and when can we expect the next round of tendering to start for those?
Mr. King : I am grateful to the hon. Gentleman for those comments. He recognises this for what it is--solid confirmation of the Government's determination to invest in the defence of our country. I will not go further than to say "around 40", but we certainly intend to implement the programme that we set out in "Options for Change". I can confirm that other ships are under way. We have a project definition of the landing platform dock. At present, other matters are proceeding, but I can tell the hon. Gentleman--I am grateful to him for seeking clarification--that in respect of a further order for type 23s, I expect that to be at a broadly similar interval comparing this with the previous order that was placed.
Several Hon. Members rose --
Mr. Speaker : Order. I say again what I said before business questions, namely, that there is heavy pressure on the next two debates. I shall allow questions to continue until 4.30, after which we shall have to move on to the debate.
Mr. Peter Viggers (Gosport) : Does my right hon. Friend agree that the fact that the machinery control order is to be placed with that fine company, Vosper Thornycroft, will be very good news in south Hampshire? Does he further agree that the fact that 71 vessels have been ordered by the Ministry of Defence since 1979 confirms what my hon. Friends and I have always believed--that under the present Government the Royal Navy will continue to play an important role and provide a fine career in the foreseeable future?
Mr. King : I certainly confirm my hon. Friend's comments about the quality of the work at Vosper Thornycroft, which is the basis of its competitiveness and why it has achieved the order placed directly by my Department. It confirms our commitment to a substantial number of ships in the future. Hon. Members could easily have been misled by referring to a previous Hansard which shows that a substantial number of ships are on order but fails to reflect the Government's commitment to naval shipbuilding. An unfortunate misprint in Hansard says that the value of the ships on order is £4.6 million whereas the correct answer should have been £4.6 billion.
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Mr. Menzies Campbell (Fife, North-East) : It would be churlish to do anything other than welcome unreservedly the Secretary of State's announcement, and I willingly do so. He will appreciate that there will be not only a sense of relief at Yarrow, but a great sense of pride that the company has been entrusted with that order. The Secretary of State mentioned in his statement the disappointment that others might feel. When will he be in a position to make a firm announcement about the placing of an order for the fourth Trident submarine?
Mr. King : I am grateful to the hon. and learned Gentleman for his comments. My announcement is a tribute to the shipyard's competitiveness and productivity. I remember walking round that shipyard some 30 years ago. A transformation has taken place in the productivity of British shipbuilding because of privatisation, because there was no bottomless pit to which shipyards could turn, and because of the sheer reality that none of those yards would exist unless there had been a quantum change in working practices. The competitive procurement policy of the Ministry of Defence has been good news not only for the Ministry and the taxpayer but for the yards. A discussion is currently taking place on the contract for the fourth Trident boat. We intend to proceed and shall resolve the contract at the earliest possible date.
Mr. Neville Trotter (Tynemouth) : It is clearly in the interests of the Royal Navy and of the taxpayer that there should be competitive tendering to obtain the lowest price. Will my right hon. Friend give me a categorical assurance that that order was decided solely on price ? Would the cost have been significantly higher if the order had been divided ? Finally, is it still the Government's intention to proceed with ordering a large helicopter carrier, known as an aviation support ship ? Swan Hunter's experience of shipbuilding for the navy makes it well placed to win a contract.
Mr. King : I can confirm my hon. Friend's first point. Nobody has fought harder than he for the interests of the shipyards of the Tyne and for Swan Hunter. I know that today's announcement will be a disappointment for them, and that those on the Tyne recognise that the response to all that they asked for previously was fair play. Yarrow was a clear winner in the competition. I also confirm that a clear benefit is that of batch ordering. We did not merely see three ships come sailing by : ordering in threes has shown significant benefits and economies. Furthermore, we intend to invite tenders for the building of an aviation support ship shortly. That is of great interest to my hon. Friend and to other hon. Members, and Swan Hunter will clearly be one of the real contenders for that.
Mr. George Galloway (Glasgow, Hillhead) : As Yarrow is the flagship in my constituency and the biggest private employer in the whole of Glasgow, I hope that the Secretary of State will accept my sense of relief and--yes--gratitude that the Ministry has made that decision today. I am also grateful for the Secretary of State's confirmation that the order was won on merit and is a testament to the ability and dedication of the management and work force at Yarrow Shipbuilders. When the Secretary of State worked in Glasgow in a previous life, he grew to know the value of the stamp, "Clyde-built". Today's order confirms that.
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When is the work likely to start? Notwithstanding the good news, many hundreds of the workers at Yarrow Shipbuilders have already gone down the road and it would be helpful if we could proceed quickly. I have just one quibble : could we not consider naming the ships HMS Stewart, Lang and Forsyth in memory of three Ministers who, notwithstanding that good news, are likely not to be in office much longer?Mr. King : I am appalled at the flippant way in which the hon. Member addresses the serious matter of the continuing equipment of the Royal Navy. I can confirm, however, that the company would not have won this order except as a private sector yard which will have to incur the costs if it makes losses. Such losses will be borne, not by the Government, but by the company. I do not think that it is in any way insulting to say that the epithet, "Clyde-built", which was a badge of quality in the last century, was getting somewhat tarnished during the post-war years. The efforts of the management and the work force now in the shipyards on the Clyde and in Yarrow's have done a great deal to restore that badge of quality, which was in danger of slipping away.
Sir Hector Monro (Dumfries) : Does my right hon. Friend appreciate that this is wonderful news for Glasgow and for Scotland and a great tribute to the work force and management, some of whom were in the House this week to meet an all-party group? As we have had some rather rough news in the past few weeks, it is a real shot in the arm and the country will be grateful for the announcement.
Mr. King : I am grateful to my hon. Friend and he is right to recognise the importance of the announcement. He is right also to say that the value is not just for Yarrow. Hundreds of subcontractors, in Scotland as in other parts of the country, will benefit from this announcement. My hon. Friend will also know the value of the more competitive and effective approach of the yard. It is currently in the final stages of negotiations for a very important order from Malaysia which, had it not been the competitive and effective yard that it now is, it would have had no chance of getting.
Mr. Frank Field (Birkenhead) : The Secretary of State said that he was mindful of the atmosphere in yards which had competed and failed. Will he share with the House his thoughts about the atmosphere that he thinks will now prevail in Cammell Laird, which finds itself unable to compete for naval orders? Is he aware that, under British Shipbuilders, Laird's was classified as a naval yard, and other yards not so classified were given intervention funding? Laird's now has to go into battle without any chance of getting either naval orders or intervention funds. Does the Secretary of State believe that the action of the board of Vickers Shipbuilding and Engineering Ltd. in disqualifying us from competing for this work is fair to Cammell Laird? What does he think that that does for the Government's competition policy?
Mr. King : I understand very well the point that the hon. Member raises, having worn another hat previously when a major shipyard was one of my biggest concerns. The question whether one had a naval involvement or access to the intervention fund was very critical indeed. That yard, privatised and sold to a new owner and with access to the intervention fund, now has a substantial number of new
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orders. I would rather not answer across the Floor of the House the serious point that the hon. Member has raised, but I will certainly look into it and come back to him.Mr. Cecil Franks (Barrow and Furness) : While the Secretary of State's announcement is good news for Yarrow and the Clyde, it is none the less a disappointment for the other three shipyards that submitted tenders, not least VSEL in Barrow, although the order for the 4.5 inch gun would be welcome.
The Secretary of State referred to Trident. To pursue the question put by the hon. and learned Member for Fife, North-East (Mr. Campbell), the Secretary of State will be aware that the long lead orders for the four Trident submarines were placed some time ago and that construction is quite well advanced. Is he able to elaborate on the answer that he gave to the hon. and learned Member for Fife, North-East? Can he say how evaluation of the tender is progressing? I understand that progress is good. Can he give some sort of time scale, given good will on both sides, and when the order may be expected to be placed?
Mr. King : I obviously understand the disappointment. There is no question but that VSEL strived genuinely to compete for the order, and put in an effective bid. Unfortunately, from the company's point of view, it was not so competitive as that from Yarrow, but it was certainly a very responsible offer. I am pleased that the hon. Gentleman acknowledges that the outstandingly successful 4.5 inch gun produced by VSEL is a source of further valuable orders for it. As my hon. Friend rightly said, the construction of the 08, the fourth boat, is currently under way and authorities have been given for the long lead items. The contract is being evaluated. The House will understand that, although we prefer these matters to be resolved by competitive tendering, in this case we are effectively talking about a single supplier, so it is vital to get the contract right. That is why we must ensure that the contract is properly dealt with-- otherwise, the Public Accounts Committee, among other bodies, will have a lot to say. We must deal with the matter carefully. I am anxious that the question should be resolved as soon as possible. Although I cannot give a date, we intend to proceed just as soon as we can resolve the question of the contract.
Mrs. Maria Fyfe (Glasgow, Maryhill) : As a Glasgow Member, I add my own expression of delight and relief, and I congratulate the Yarrow management and work force. They certainly deserve their success. Anyone who has spoken to them recently knows of the problems with which they have had to cope. May I add one small point? I was surprised to hear the proposed names for the three frigates. As the memory of the clearances lingers in Scotland, I suggest that the Duke of Sutherland is perhaps not the most popular name that could have been chosen.
Mr. King : Given that the announcement is outstandingly good news for the hon. Lady and her constituents, it is unfortunate that she should wish to introduce a divisive note.
Mr. James Hill (Southampton, Test) : I congratulate Yarrow on its good fortune in securing a contract for three ships at once, but I must express some dismay on behalf of Vosper Thornycroft, Southampton, which has built many naval ships in the past.
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I have a query about the fibreglass minesweepers. I understand that my right hon. Friend has just been to Oman, so perhaps he can give the House some information. Vosper Thornycroft, Southampton, is anxiously waiting for confirmation of the order from the Sheik of Oman for a fleet of minesweepers.Mr. King : I confirm that I returned from the Gulf late last night. I spent some time in discussion in Oman, not about the minesweepers but about the much more valuable corvette order that the Omanis are seeking to place, and I was given very satisfactory assurances by His Majesty the Sultan about those orders. Details remain to be resolved and I hope that it will be possible to resolve them quickly.
Mr. Nicholas Brown (Newcastle upon Tyne, East) : When the Secretary of State listed the areas that would benefit from today's announcement, he made no mention of Tyneside. He has now ordered 13 type 23 frigates, four of which either were or are under construction at Swan Hunter on Tyneside. I understand that type 23 frigates are grouped in fours around the fleet auxiliaries. AOR1 is the first auxiliary oil replenishment vessel and AOR2 is currently being constructed on Tyneside. As the Secretary of State has now ordered 13 type 23 frigates and has only two AOR vessels, does he not need to order another AOR vessel? When will he make an announcement about AOR3?
Mr. King : I do not have any comment to make on that ship at the moment, but the hon. Gentleman will have heard what I said to my hon. Friend the Member for Tynemouth (Mr. Trotter) about the aviation support ship, for which Swan's is obviously one of the real contenders. That could be an important ship for Swan's. I took the trouble to look at what the hon. Gentleman said last time, when Swan's was successful. He said magnanimously, "All that we ever ask for is fair play." I can assure him that fair play is what he has got in this case. I am sorry that he is disappointed that the order did not go to Swan's, but I can assure him that there was fair play and it has gone to Yarrow.
Mr. John Pawsey (Rugby and Kenilworth) : Is my right hon. Friend aware that the order and the announcement will be widely welcomed, particularly by the work force and managment of GEC, Rugby? It is good news for jobs and it is good news for the town. Can my right hon. Friend say what is the global worth of the contract, and does he agree that it represents a vote of confidence in British engineering?
Mr. King : I can confirm that. This statement differs from previous statements in that it spells out the main contractors. There is a tendency for people to approach this matter as though it were one entirely for the shipyard concerned. In fact, the larger part of the value of the contract is not in the hull itself but in the components, a significant proportion of which will be provided by GEC in Rugby. Obviously, for commercial reasons, I cannot disclose individual contract values. However, I can confirm that the overall value of the ships with equipment that I have announced today approaches £400 million.
Mr. Peter Archer (Warley, West) : Will the right hon. Gentleman ensure that his Department takes an adequate
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interest in the subcontracts? Is he aware that the chain and cable industry in this country is widely accepted as being the best in the world in terms of both technology and workmanship? Will he ensure that it is not unfairly excluded as a result of the foreign dumping of inferior chain?Mr. King : I am interested to hear that, and I will certainly look into it.
Mr. Jonathan Sayeed (Bristol, East) : My right hon. Friend will be aware that HMS Norfolk--the first of the Duke class--has been accepted into the fleet and has been completing work-up at Portland. Past colleagues of mine who are still serving in the Royal Navy tell me that she is an outstanding success and a tribute to British shipbuilding. Indeed, she is a foretaste of what we shall be getting in these other ships. Is my right hon. Friend aware that his announcement about vertically launched Sea Wolf will be most welcome to British Aerospace in Bristol? I know that in this regard my feeling will be echoed by my hon. Friends with responsibility for Bristol constituencies. It is regrettable that, yet again, the Labour Member for Bristol has not bothered to turn up.
Mr. King : I did notice the absence. I know that my hon. Friend, who takes a close interest in these matters, understands the importance to Bristol and to British Aerospace of this decision and this order. Bearing in mind his experience and his information, I am pleased to hear his tribute to the quality of HMS Norfolk--as it happens, the first of class, built at Yarrow. The news that my hon. Friend has given the House is encouraging.
Mr. Dick Douglas (Dunfermline, West) : Does the Secretary of State accept that this news is very welcome indeed? It is a tribute not only to the management at Yarrow but to the workers, who have spent a long time removing ill-considered demarcation practices--and it is as a shipbuilder that I say that. Will the Secretary of State concede that one of the things that this will enable Yarrow to do is to keep its essential design capability, illustrated by the fact that it produced the first of class? Will he continue to allow it flexibility in respect of other markets?
Mr. King : I note what the hon. Gentleman says, but I have to make the point that it will not be possible to keep any design capability, any warship-building capability or any manufacturing capability for the sort of defence components that we need unless the Government are prepared to fund the defence programme at a sensible level. While I am far too gentle and decent a person to criticise any Opposition Member who has joined in the expressions of appreciation of this action, I have to say, in the kindest possible way, that if the defence policies to which the Opposition subscribe--I include all the Opposition parties--were implemented, we should not be ordering a rowing boat, let alone three frigates.
Mr. David Martin (Portsmouth, South) : I am grateful for my right hon. Friend's statement because it demonstrates the Government's commitment to a better equipped fleet for the future, even though the fleet manpower is contracting, and because jobs will be provided in the Portsmouth travel- to-work area. Many people wish to write down the opportunities which exist, but under the present Government there is a future for many of the defence- related industries in my area.
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Mr. King : I am grateful to my hon. Friend who, I know, appreciates the situation very well. We have announced changes, including some reductions in numbers. It is true that the new type 23s, because of their greater capability and efficiency, will operate with smaller crews. They show very clearly that the Government are ensuring that, while we may reduce the personnel numbers in our armed forces, we are increasing the relative proportion of funds spent on their equipment to ensure that in the future they have the equipment that they need to perform the tasks that we set them.Mr. John Home Robertson (East Lothian) : I join the whole House in paying tribute to the work force and management at Yarrow on winning this vital order against such stiff competition. Can the Secretary of State confirm that the competition was won on price ? And can he reveal whether the tendering process says anything about the level of profits being made by VSEL in the manufacturing and construction of Trident submarines ?
Mr. King : No, I cannot comment on that, but it is relevant to the contract negotiations for Trident 08--we must protect the public Exchequer precisely from the problem of a monopoly single buyer. I can certainly confirm that the contract was placed on merit ; it was won by a clear margin in a competitive tender.
Mr. Lewis Stevens (Nuneaton) : Does my right hon. Friend accept that this is good news for the Ansty Rolls-Royce plant in my constituency which manufactures Spey engines? This is welcome news for the employees and management of that company. Will he also accept that his demonstration of confidence in the plant's high quality power unit is most important for the company when it seeks orders abroad?
Mr. King : I am grateful to my hon. Friend. It is certainly true that the Spey engines have proved an outstanding success. The Royal Navy has great confidence in them and they were chosen for their quality, flexibility and efficiency. They have stood the Royal Navy in good stead. It is because of our defence programme's ability to maintain an effective ordering programme that we can also attract interest among overseas countries. What we invest in is always of great interest to such countries. They know that if an item has the Royal Navy's endorsement it is bound to be of good quality. Several Hon. Members rose --
Mr. Speaker : Order. I will certainly look with compassion in days to come on the three hon. Members whom I have not been able to call on the statement, but we have a busy day ahead of us.
Points of Order
4.31 pm
Dr. John Cunningham (Copeland) : On a point of order, Mr. Speaker. Earlier, the House heard the hon. Member for Dartford (Mr. Dunn) make wholly untrue allegations about Labour's policies with respect to the savings and income from savings of pensioners. We have come to expect the premeditated dishonesty of Conservative Central Office to be reprinted in the Daily Mail, but we do
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not intend to allow it to go unchallenged in the columns of Hansard. The hon. Gentleman should withdraw his allegation.Mr. Speaker : I cannot be expected to monitor these statements. I am not a member of the Conservative party, so I do not receive this literature.
Mr. Robert G. Hughes (Harrow, West) : On a point of order, Mr. Speaker. Shortly before yesterday's debate on the economy you told the House that in your opinion the general election campaign started when we came back from the Christmas recess. Of course, in these difficult circumstances you seek to keep order, but I ask you to reflect on one problem and to see what you can do about it. I refer to what I regard as the Labour party's organised disruption of yesterday's debate.
The example that I wish to mention is drawn not only from the delayed start of the debate but from the organised barracking of the Chief Secretary to the Treasury orchestrated from the Back Benches by a Labour Whip. So now we know that a member of the Labour party Whips Office was organising the disruption.
Mr. Speaker : The hon. Member, and others, do not receive letters about this from the general public, but I do. When I have to answer them I have some difficulty defending Members of the House, for whom I have a high regard and affection, if they behave badly, but such bad behaviour does not always come from the same side of the House.
Mr. Harry Ewing (Falkirk, East) : On a point of order, Mr. Speaker.
Mr. Speaker : This all takes up a lot of time ; we are under great pressure today.
Mr. Ewing : I am delighted to learn that you are a floating voter, Mr. Speaker. On behalf of the Labour party, I invite you to join the vast majority of people in this country at the next election and to vote Labour.
Mr. Derek Conway (Shrewsbury and Atcham) : On a slightly more serious point of order, Mr. Speaker. You were right to point out that from now until polling day, whenever it may be, will be somewhat tortuous not just for the watching public but for Members who sit in this Chamber. You will no doubt be concerned for the reputation of this House. As we may have to wait even until the summer, tempers may get a little tetchy, as last night's closing session proved. Would it be worth your while to consider sending for the chairman not only of the 1922 committee but also of the parliamentary Labour party so that the leaders of the respective parties in Parliament can discuss with you the conduct last night? The Chief Secretary was undoubtedly unable to explain his case fully because of the obviously organised baiting. That does not augur well for the reputation of the House.
Mr. Speaker : I do not think that it is necessary for me to send for the chairmen of Back-Bench committees. The behaviour of the House is in the hands of hon. Members themselves. They surely do not need to be told by the chairmen of the respective parliamentary committees what they should and should not do. I ask the hon. Member to reflect on what he has said.
Mr. David Winnick (Walsall, North) : On a point of order, Mr. Speaker. I have a suggestion.
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Mr. Speaker : Yes?Mr. Winnick : You said that you receive letters of complaint from the general public. May I help you by suggesting that if you could persuade the Prime Minister to fix the election date now there would be no need for this pre-election period--if the Prime Minister would stop shilly-shallying because he is afraid of going to the country.
Mrs. Maria Fyfe (Glasgow, Maryhill) : On a very brief point of order, Mr. Speaker. A few minutes ago the hon. Member for Bristol, East (Mr. Sayeed) attacked my hon. Friend the Member for Bristol, South (Ms. Primarolo) for being absent from the Chamber for the statement. I do not know why my hon. Friend is not here today, but I know that she is a very hard-working, committed hon. Member. For whatever reason, she is not here ; I am sure that she is doing something important.
Mr. Speaker : I hope that in this period of electioneering excitement we can keep off the personalities and concentrate on the policies.
In relation to what the hon. Member for Walsall, North (Mr. Winnick) said about the letters that I receive, very few of them to date, particularly since we have been televised, have been about bad behaviour in the House-- rather the reverse--and I wish it to remain that way.
Dr. Norman A. Godman (Greenock and Port Glasgow) : On a point of order, Mr. Speaker.
Mr. Speaker : Because the hon. Member was not called earlier, I will allow the point of order.
Dr. Godman : With unfailing respect, may I ask why I was not called on the Yarrow statement? I have not spoken in this place for a considerable period of time.
Mr. Speaker : I do not think that I should explain to the hon. Member why he was not called. I have to have a balance of Glasgow Members and other hon. Members--[ Hon. Members :-- "Clyde Members."]--well, Clydeside Members, then, against some other hon. Member who did not hear such good news as the hon. Member has had. I thought that because he had had such good news he might just like to keep it to himself today.
BILL PRESENTED
Social Security (Mortgage Interest Payments)
Mr. Secretary Newton, supported by the Prime Minister, the Chancellor of the Exchequer, Mr. Secretary Heseltine, Mr. Secretary Brooke, Mr. Secretary Hunt, Mr. Secretary Lilley, Mr. Secretary Lang, Mr. Nicholas Scott and Miss Ann Widdecombe, presented a Bill to make provision for requiring, in certain cases where interest on a loan secured on land is payable by a person who is entitled, or whose partner, former partner or qualifying associate is entitled, to income support, the applicable amount in respect of which includes a sum in respect of that interest, that a part of the benefits to which any of those persons is entitled under the enactments relating to social security shall be paid directly to the lender and applied towards the discharge of the liability in respect of the interest ; and for purposes connected therewith : And the same was read the First time ; and ordered to be read a Second time tomorrow and to be printed. [Bill 57.]
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Opposition Day
[3 rd Allotted Day
]
Poverty
Mr. Speaker : I must announce to the House that I have selected the amendment in the name of the Prime Minister. Furthermore, a very large number of hon. Members are seeking to participate in the debate. It would be possible for me to call them all if they were to limit their speeches to 10 minutes. I have no authority to do that in a half-day debate, but perhaps hon. Members will bear it in mind. If I may say to those on the Front Benches too, half-hour speeches would help the whole House.
4.37 pm
Mr. Michael Meacher (Oldham, West) : I beg to move,
That this House, noting that the ten million people today living on or below the income support level of less than £40 a week for an adult represent the greatest numbers in poverty in Britain since the war, and that the Government has as a deliberate policy over twelve years further impoverished the poorest one third of the nation to make the rich richer, calls on the Government to reverse its policies of increasing poverty and unemployment and to give priority to the growing millions excluded from the rights and opportunities of real citizenship by increasing pensions by £5 per week for a single pensioner and by £8 a week for a married couple, by re-instituting the pension link with earnings which the Government broke twelve years ago, and by restoring to families the losses in child benefit from three years of government freeze.
There could be no clearer indicator of the indifference and contempt in which the Government hold those on the lowest incomes than the Government's exclusive concern with our tax proposals, without even a glimmer of a mention of those who will benefit from them. There could be no more revealing insight into the Government's priorities than their obsessive concentration on the 8.7 per cent. richest taxpayers whom the independent Institute of Fiscal Studies estimated would lose under our proposals while at the same time completely ignoring the 46 per cent. of the population who, the same institute calculated, would gain under our proposals.
We should not, however, be surprised. This is the Government who have stopped pensioners getting an annual increase in line with Community living standards, a deliberate act of policy in 1980, which cumulatively so far-- according to a parliamentary answer to me on 25 November last--has removed from pensioners £31.8 billion of improved pensions which they would otherwise have had.
The Government have cut unemployment benefit 11 times since 1979, making a cumulative "saving"--if I may use that word--at the expense of the unemployed, of £5 billion to £6 billion over the past decade. They have repeatedly cut benefits for the disabled by abolishing industrial injury benefit, by abolishing disablement benefit for seven out of eight disabled people and by abolishing the reduced earnings allowance for disabled people who cannot earn a full wage. They have frozen child benefit for three years so that mothers and families are nearly £1 billion worse off than they would otherwise have been.
Mr. James Arbuthnot (Wanstead and Woodford) : About 18 months ago, the hon. Gentleman said that he
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had irrefutable evidence that the Government intended to abolish child benefit. After three increases, where is his evidence? Has he lost it, or did he make it up?Mr. Meacher : I did not say that I had irrefutable evidence. I certainly regarded the continuance of child benefit as very uncertain, and I still regard it as uncertain. If by some mischance the Government are returned for a fourth term, I should be surprised if child benefit survives to the end of their term.
With a record like that, no wonder Ministers want to keep the spotlight on the tax and national insurance costs of our proposals and away from the half of the nation who will gain. For that half of the nation, the Government have been the meanest, the most divisive and the most vindictive Government in modern times. It is all too clear why there has been such an unremitting broadside from Ministers against our tax and national insurance proposals. It is partly because they are desperate to divert attention from the recession--which they created, from which they cannot escape and which will lose them the election--and partly because they are desperate to conceal the enormity of what they have done in wilfully impoverishing the poorer half of the nation.
By contrast, I make it clear that Labour believes it is right and just and should be the first priority for pensioners to get an increase of £5 a week for a single pensioner and £8 a week for a married couple, given the mean and miserable way in which they have been treated over the past decade. We shall make no corresponding deductions from income support, housing benefit or poll tax benefit, which means that the poorest pensioners will gain the full £5 and £8 a week.
It is also right and just that mothers and children should be compensated for three years of Tory freeze by getting an increase in child benefit of more than £2 a week for second and subsequent children. We have been honest in making it clear that the extra cost of that will be confined to the richest 10 per cent. of taxpayers. It is fair that those on £70,000 a year should contribute. According to a parliamentary answer on 6 March last year, those people have gained an extra £700 a week in real terms from tax cuts in successive Budgets since 1979.
It is also fair that those on £60,000 a year who have gained an extra £192, those on £50,000 a year--a group which includes several Ministers--who have gained an extra £131 a week and those on £40,000 who have gained an extra £77 a week should also contribute. A small contribution should also be made by those on £30,000 a year who have gained an extra £45 a week. I make it clear that no contribution will be sought from anyone earning less than £21,000 a year, or £405 a week. We intend to take back a small fraction of the large windfall tax gains received by the 10 per cent. richest taxpayers over the past decade so that we may restore to nearly half the population a modest part of the cuts imposed by the Government on all the poorest groups in the country. We think that that is fair and we believe that the country will think it fair.
The Secretary of State for Social Security (Mr. Tony Newton) : How can the hon. Gentleman explain the guarantee that he gave in the last few sentences, bearing in mind that national insurance contributions are levied weekly, not annually, and would be levied on anyone
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whose income, because of bonuses, overtime, commission and so on in any one week, went above the rate representing the annual level?Mr. Meacher : That issue has been raised during the past couple of weeks. It ill-behoves the Government to raise the issue of a few dozen, perhaps a few hundred, people who on one or two weeks of the year suddenly get a substantial increase in pay, given that the Government have doubled VAT even though they said they would never do that.
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