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Miss Widdecombe : The hon. Gentleman can sit down because I cannot remember what his face was like on that occasion, but I know what the overall reception from the Opposition was like. When we called out for the Opposition to cheer on what we were doing, they still sat silent and they still looked miserable. They did not want us to protect benefits on that occasion.
Mr. Field : It is totally untrue to say that we were not relieved. Earlier in the debate a number of Conservative Members minimised the Secretary of State's two achievements. First, he defended his budget in the face of bizarre Cabinet colleagues and, secondly, having conducted an extraordinary campaign in the press that suggested that every sort of benefit would be cut, he came to the House in triumph to say that no benefits had been cut. Why do his colleagues suggest that he did not gain such achievements? Why will the Under-Secretary not accept that the Opposition were genuinely relieved when, for once, those on the Treasury Bench protected the poorest in our society?
Miss Widdecombe : I am happy to accept that the hon. Member for Birkenhead was relieved, because that would be in keeping with the characteristics that he has always displayed in the House. But if the expression on Opposition Members' faces on that day indicated relief, I dread to think what they look like when they are gloomy.
I shall now jump a point in my speech to deal with a matter raised by the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood), which has just been raised again by the hon. Member for Birkenhead and others--that somehow my right hon. Friend the Secretary of State encouraged adverse speculation, raised fears among the dependent and weak, and generally encouraged people to think that the worst would happen simply so that he could come here and present a great triumph in the end.
I remember sitting on these Benches and, time and again, Opposition Members stood up and asked where in the Conservative manifesto we promised to tax invalidity benefit, because that was what we intended to do. They asked whether we denied that we intended to means-test the state pension, given that that was what we intended to do. The Opposition are responsible for stirring up many fears by asking those questions time and again.
Miss Widdecombe : If I give way to the hon. Gentleman, I hope that he will give the House some information. Will he name one journalist or any other source who says that his or her information came from my right hon. Friend?
Mr. Field : The hon. Lady knows perfectly well that, under the wretched Lobby system of this place, that cannot be done. It would let people down. It is terrible that the Secretary of State, who has achieved so much, should now be supported by a wretched Minister--
Mr. Field : A non-wretched Minister, who comes to this House and, under the guise of loyalty, tries to minimise his achievement. Fortunately, English courts do not decide whether people are guilty on the basis of what their faces look like. The Secretary of State has now cheered up, but he looked pretty glum when the hon. Lady was minimising his significant double achievement.
Far from minimising my right hon. Friend's achievement, I put it on a Europewide and worldwide basis by comparing it with the non-achievement of other countries that did not protect their benefit system.
Mr. Dewar : Will the Under-Secretary deal with two brief points? First, she probably read, as I did, the reports of her right hon. Friend's speech to the 1922 Committee shortly before the autumn statement, which gave some substance to the press reports that were coming from somewhere not far from the Department about the possible content of that statement.
Secondly, when the Minister accuses the Opposition of irresponsibility talking about the possibility of taxing invalidity benefit, does she recall that the right hon. Gentleman made it honestly and explicitly clear that he wished to tax invalidity benefit and was merely being held back by technical difficulties that he soon hoped to overcome?
Mr. Lilley : Would it help my hon. Friend the Under-Secretary to relieve the hon. Member for Glasgow, Garscadden (Mr. Dewar) of his profound credulity with regard to the newspapers if I told him that, as much as I should love to address the 1922 Committee, I have never received an invitation to do so?
I was asked about tax and invalidity benefit, although I am not sure what they have to do with the Bill. Although the policy has always been clear, the autumn statement did not say that we intended to do anything about that. It was a scare story dreamt up by the Opposition.
Column 111The hon. Member for Garscadden asked about age-related rebates and our overall plan on that issue. We made it clear in the manifesto that our ambition was to introduce age-related rebates by April 1996. We have no reason to depart from that at this time. Nothing will be done without extensive consultation, and when we have formed a view about the appropriate structures there will be such consultation and the necessary views will be taken into account.
The hon. Member for Garscadden asked about the extensive nature, as he saw it, of the 2 per cent. incentive. My hon. Friend the Member for Havant (Mr. Willetts) made a valuable point about the projection of savings. I listened carefully to the amounts mentioned by the hon. Member for Garscadden. He classified them as a net expense to personal pensions, but they include the rebates that would have been paid if they had been ordinary contracted-out occupational pension schemes. The observation by my hon. Friend the Member for Havant and the inclusion of the rebate figure closes the matter from both ends. The hon. Gentleman should do his sums again before he challenges us in Committee on the expense of the incentive.
The hon. Member for Garscadden asked why we, to use his words, discriminated against company-operated money-purchase schemes--COMPs. My hon. Friend the Member for Havant, the hon. Member for Roxburgh and Berwickshire and several other hon. Members also asked legitimate questions on matters related to that, which are causing concern. There is a difference between COMPs and the operation of a personal pension scheme, which is simply an arrangement between a person and a provider. We need to examine the whole history of personal pensions and what moved us to introduce the incentive.
The hon. Members for Garscadden and for Newcastle-under-Lyme, in their call for a return to SERPS, seemed to be denigrating personal pensions, which have benefited 5 million holders. The average wage of a person taking out a personal pension is £9,750. That means that such pensions address the problems of precisely those people whom the Opposition always say they want to protect--people on modest incomes who are not able to benefit from the large structures of occupational pension schemes and big corporate plans. We wanted to encourage such people and at the same time to promote the flexibility of choice, which is not in SERPS but which exists in personal pensions. We also wanted to encourage pension portability and flexibility of ages at which a pension can be taken out and so on. All that implies an arrangement between an individual and a provider.
COMPs operate rather differently. First, there are economies of scale. Secondly, there is inflexibility in the age at which benefits may be taken. Thirdly, and most important, there is a difference in the method of payment. COMPs generally pay monthly, but personal pension contributions are made after the end of the tax year. This reduces the burden on the employer and throws into question whether, at this juncture, it is appropriate to extend to COMPs the same arrangements as for personal pensions to employers. The point has been taken on board, given the essential differences--
Miss Widdecombe : No, I am trying to address the point seriously, because it was well worth raising and I want to get our thinking on it clear and, in turn, to make that clear to the House. Because of those essential differences in the way in which the big corporate scheme operates --it is determined by the employer, it does not give the same flexibility and, although it does not work in the same way as an occupational pension scheme, in that it is not salary-related, it works in the same sort of structure--we do not see, at this stage, the argument for extending the rebate to it.
Mr. Field : When the hon. Lady is in the Department considering whether these rebates should operate, should not one of the considerations that the Government take into account be whether schemes will give people adequate income so that they are free of income-related assistance and, in the Government's own words, they can stand on their own two feet? Can she guarantee that the subsidies will achieve that objective?
Mr. Willetts : I am grateful for my hon. Friend's explanation of the Government's position on COMPs. Is the regime for COMPs part of the review of age-related rebates that is taking place in the Department with a view to a new structure being in place by 1996?
Miss Widdecombe : All aspects of age relation are being reviewed, including salary-related schemes, personal pensions, COMPs and any other variety that my hon. Friend may be able to describe. Although I cannot give him an assurance as to the outcome, I am happy to give him an assurance that they will all be considered.
Mr. Rhodri Morgan (Cardiff, West) : One of the disadvantages of a personal pension plan, which has emerged in the case of a constituent of mine, is that there appears to be no precedent for the Inland Revenue giving consent, in cases of terminal illness with a life expectancy of less than 12 months, for the fully paid-up pension to be drawn out by the person with the terminal illness. That is possible with executive pension plans and some other company schemes.
The Inland Revenue is remarkably slow, particularly when someone has a life expectancy of less than 12 months. That seems to constitute maladministration in the affairs of government. I have already written to the Treasury, but will the hon. Lady look into the matter as well?
Miss Widdecombe : We have recently been made aware of that subject-- the hon. Gentleman may have been instrumental in that. We are exploring the matter and I hope to write to him in due course, but I cannot give him an answer now.
Viability, reliability and safeguards are necessary to protect those who take out personal pensions. There is continual contact between the Department and the regulators. Most of the various recent initiatives have been entirely motivated by the regulators rather than the result of a request from the Department. Some initiatives have been concerned with tightening up the advice that is given and the check list of what information must be given by the
Column 113potential buyer to the person who is selling him, or not selling him as the case may be, the pension. The regulators constantly review the monitoring process. However, we accept that it is necessary for us to produce regulations that command the confidence of those who wish to take out personal pensions and we are consulting the regulators to that end. We want to see a tightening up of the present procedures, or possibly an enlargement of them, and more detailed monitoring than is currently possible, rather than an entire new regime.
Mr. Day : My hon. Friend will be aware that the Select Committee on Social Services has been examining the matter of regulation. Will my hon. Friend give an undertaking that when the Select Committee is in a position to report she will take its findings closely into account? The present regulations, especially for the state earnings-related pension scheme, need investigation. The Select Committee has carried out a detailed investigation.
Miss Widdecombe : I assure my hon. Friend that any report of the Select Committee will be examined and responded to according to normal procedures. Of course, we wish to take into account the views of the Select Committee before reaching any conclusions. I am sure that the regulators will be equally interested in suggestions such as those proposed by the Select Committee which is chaired by the hon. Member for Birkenhead.
Miss Widdecombe : Certainly, both the amount and the nature of the commissions--for example, front-loaded commission--will be taken into account. [Interruption.] I have been reminded by a rather helpless gesture that I am in breach of a promise, so I will allow the final intervention to come from the hon. Member for Bradford, North (Mr. Rooney).
Mr. Rooney : Earlier, the Minister talked about 5 million beneficiaries. Technically, people become beneficiaries when they retire. The feeling in the House is that it could be 20, 30 or 40 years before people find that they have been given bad advice. Without a meaningful compensation scheme, it is not enough simply to have a system in which people can be suspended from the Financial Intermediaries, Managers and Brokers Regulatory Organisation and the Life Assurance and Unit Trust Regulatory Organisation.
Miss Widdecombe : If we were to discover evidence of widespread difficulties or even malpractice, it would be our intention that there should be a trawl of those who have already taken out personal pensions. Therefore, I do not think that anybody will be left behind if we conclude that tighter regulation is desirable and there has been a widespread problem. I do not necessarily say that we have already reached that conclusion. However, if we come to it, the hon. Gentleman is right--we will have to consider
Column 114those who are already in the system just as much as those who have not yet entered it. I am pleased to give the hon. Gentleman that assurance.
The subject of Mr. Maxwell and the Maxwell pensioners was raised several times during the debate, although I have no idea what it has to do with the Bill. I can only repeat what I said during Question Time today : the way forward to restore peace of mind to the Maxwell pensioners must be to achieve a distribution from the common investment fund, which, after all, has £123 million. It is not a matter of trying to recover something that is missing. Achieving a distribution from the common investment fund is essential. The hon. Member for Croydon, North-West (Mr. Wicks) made a valuable and thoughtful speech. He spent some time talking about unemployment. As I understood it, he effectively said that unless we tackled the matter of wealth creation and took measures to stimulate employment, we were talking in a vacuum because we were talking theoretically about what we would be able to do as a future contribution. I draw the attention of the hon. Gentleman to a large number of initiatives that the Government have taken to stimulate employment and counter the undoubted evil of rising unemployment and the misery which it brings.
There have been almost 1.5 million opportunities for unemployed people this year--an increase of 500,000 on the year--through the introduction of new job plan workshops and training for jobs, and the expansion of existing successful measures. There is now the widest-ever range of opportunities for the unemployed which, together with a vast range of measures, including extra resources, and more places in job clubs and on job interview guarantee programmes, is a clear sign of the Government's acceptance of the necessity, which we have always accepted, of promoting employment and getting people back to work. It also shows our recognition that measures need to be taken and are being taken.
Miss Widdecombe : I made it abundantly clear that I had taken my last intervention. I reneged on that pledge one minute later only because not to do so would have meant a breach of promise. Another theme that was consistently raised, mainly by Conservative Members, but also by the hon. Member for Birkenhead, was the importance of not tying up occupational pension regulations so tightly that we encouraged employers to opt out of supplying pension arrangements such as salary-related schemes or even money -purchase schemes. The Government are fully seized of that issue. When the Goode committee reports we shall take account of what it says and seek to achieve a balance between keeping the confidence of the pensions industries and the confidence in pensions, however provided, of people who take them out, and ensuring that employers do not find that they are so over- regulated that it proves a disincentive to them to set up schemes.
The subject of older pensioners and the general level of state provision was repeated by all hon. Members. The hon. Member for Roxburgh and Berwickshire described the cohorts who are not covered by occupational pensions and, of the 30 per cent. not covered, he differentiated between men and women. He will, of course, understand that the present figures reflect an historical influence
Column 115brought about by the fact that women have always been more likely to take part-time, temporary and low-paid work. We are aware of that. Personal pensions which are flexible, portable and "come -back-toable" would benefit women. We recognise the differential in those figures, and will take any reasonable steps that we can to address the issue. The subject of pensioners without secondary income--not the 30 per cent., which refers only to those without occupational income--was also raised, particularly by my hon. Friend the Member for Teignbridge (Mr. Nicholls), who spoke of the Teignbridge action group.
r hon. Member, whose constituency I did not note and who spoke shortly after the hon. Member for Birkenhead, referred to the need tconsult pensioner interest groups. I regularly meet pensioner interest groups such as Pensioners Voice, the Pensioners Convention and Age Concern, and many much smaller interest groups that ask to come to see me. I can assure the hon. Gentleman who is now absent that I take such consultation very seriously. Mr. Wicks : What didthey say?
Miss Widdecombe : They told me that they want savings that are protected against inflation, a reasonable state pension, a good state pension in comparison with what is available in the rest of Europe and a general rise in their incomes. I am pleased and proud to say that the Government have delivered all their wishes.
The major concern of the groups was not whether they were linked to a theoretical earnings figure, as they were under the last Labour Government, when they saw a measly rise in their incomes of 3 per cent., but what their overall incomes would ultimately be when they had to rely on state pensions. They are not interested in theoretical links to something that does not deliver the goods.
The issue of new-age travellers was, for a while, hotly debated across the Floor of the House. I am not sure how they come into these matters unless they have personal pensions. It seems-- [Interruption.] The hon. Member for Birkenhead should not point to my hon. Friend the Member for Westbury (Mr. Faber), because the hon. Gentleman said that it was disgraceful that the Government had not done something sooner. The hon. Gentleman, who is always concerned to protect those who might be caught up in regulations, would have protested had we reacted to a one-off incident three years ago. Once we found that there was a recurrent problem we reacted to it. There was no question of staff going out in buses to distribute social security benefits. The forms were processed in the usual way and 159 claimants were allowed, not the many hundreds that have been suggested. We were responding to a public order situation in which we did not want a small town swamped. Nor did we want the Department's offices swamped. We responded sensibly. The interpretation that has been placed on it owes as much to the Opposition as it does to the excesses of our friends in the press.
Column 116understand easily. It is necessary to tell him things five or six times before he comprehends. I have taken my last intervention in this debate. Time is now pressing.
My hon. Friend the Member for Finchley (Mr. Booth) talked wisely about a matrix of care, and I shall put the policy that we are advancing into that context. My hon. Friend is right because we are looking for a partnership between the voluntary agencies--providers of care from a vast range--and the state. In promoting the Bill, we are similarly promoting that partnership. It is based on the individual providing for himself and the state making its contribution in the form of incentives and rebates. I think that my hon. Friend talked extremely wisely and caught in his words the thrust of the Bill. At the end of a long and interesting debate I take up the issue that was raised--
Several hon. Members talked about the reform of the state earnings-related pension scheme. It is interesting that the comments were not confined to my right hon. and hon. Friends. Opposition Members called for an examination of the nature of SERPS, on which the Government have already embarked. That was done in 1986 when we modified the provision for SERPS to take account of the changing nature of things. We have SERPS under review, as we have everything else that relates to pensions.
I end on a happy note. My hon. Friend the Member for Teignbridge asked how many telegrams of congratulations for 100th birthdays have been issued this year. I am delighted to report that 285 men and 2, 317 women were aged 100 or over this year. That represents a 15 per cent. increase over the previous year. Perhaps women's longevity somewhat redresses the balance which the hon. Member for Roxburgh and Berwickshire brought to our attention.
We believe in the provision of personal pensions. We believe in making such pensions available to people with modest incomes who would not be able to provide for themselves through an employer. We believe in a state pension that is based on sound principles and not on profligacy. That is what we have produced in the Bill, and I commend it to the House.
Question put and agreed to.
Bill accordingly read a Second time.
Bill committed to a Committee of the whole House.-- [Mr. MacKay.] Committee tomorrow.
Queen's Recommendation having been signified--
That, for the purposes of any Act resulting from the Social Security Bill, it is expedient to authorise the payment out of money provided by Parliament of any sums required to be paid into the National Insurance Fund.-- [Mr. MacKay.]
That, for the purposes of any Act resulting from the Social Security Bill, it is expedient to authorise payments out of the National Insurance Fund into the Consolidated Fund in respect of administrative expenses incurred by the Secretary of State.-- [Mr. MacKay.]
Motion made, and Question put forthwith pursuant to Standing Order No. 101(5) (Standing Committees on Statutory Instruments, &c.).
That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Income) (Guyana) Order 1992 be made in the form of the draft laid before this House on 6th November.-- [Mr. MacKay.]
Question agreed to.
Motion made, and Question put forthwith pursuant to Standing Order No. 101(5) (Standing Committees on Statutory Instruments, &c.). That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Income) (Falkland Islands) Order 1992 be made in the form of the draft laid before this House on 6th November.-- [Mr. Mackay.]
Question agreed to.
Motion made, and Question put forthwich pursuant to Standing Order No. 101(5) (Standing Committees on Statutory Instruments, &c.).
That the draft Private Streets (Amendment) (Northern Ireland) Order 1992, which was laid before this House on 19th October, be approved.-- [Mr. Mackay.]
Question agreed to.
That Mr. Ian Bruce be disharged from the Employment Committee and Mr. Harry Greenway be added to the Committee.-- [Sir Michael Nuebert, on behalf of the Committee of Selection.]
That Mr. Hartley Booth be discharged from the Home Affairs Committee and Dame Jill Knight be added to the Committee.-- [Sir Michael Neubert, on behalf of the Committee of Selection.]
That Mr. Michael Bates be discharged from the Social Security Committee and Mr. Alan Duncan be added to the Committee.-- [Sir Michael Neubert, on behalf of the Committee of Selection.]
Mr. Hugh Bayley (York) : I wish to present a petition on behalf of many of my constituents who are concerned that rail privatisation will lead to a poorer service for the travelling public. The petition is signed by Mrs. V. Wellburn of Milner street, Acomb, York, and by 1,911 other York residents. It reads :
To the Honourable the Commons of Great Britain and Northern Ireland in Parliament assembled.
The Humble Petition of rail travellers who use or are eligible to use British Rail railcards Sheweth
That there is great concern on the part of rail travellers that rail privatisation may limit the eligibility of families with children under 16, young people and students, disabled people (with or without an escort) and senior citizens to purchase nationally recognised railcards entitling them to concessionary fares on the current full range of railway routes and services.
Wherefore your Petitioners pray that your honourable House will enact legislation which as part of a national rail ticketing service will safeguard the eligibility of families with children under 16, young people and students, disabled people (with or without an escort) and senior citizens to purchase railcards entitling them to concessionary travel on the current full range of railway routes and services.
And your Petitioners, as in duty bound, will ever pray, &c. To lie upon the Table.