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House of Commons
Monday 31 January 1994
The House met at half-past Two o'clock
PRAYERS
[Madam Speaker-- in the Chair ]
Oral Answers to Questions
SOCIAL SECURITY
Benefit System
1. Mr. Flynn : To ask the Secretary of State for Social Security what proposals he has to improve the operation of the benefit system.
The Secretary of State for Social Security (Mr. Peter Lilley) : We are continually improving the operation of the benefit system. Over the past two years, the time taken to process claims for most key benefits has been reduced by an average of 30 per cent. and output per member of staff has been increased by more than 20 per cent. For the future, I announced last September the one-stop programme to improve customer service and value for money even further.
Mr. Flynn : Has the Secretary of State noticed that the Social Security (Incapacity for Work) Bill is only the latest in a long series of salami cuts in the income of people on invalidity benefit? If the benefit were still being paid under the same conditions that operated in 1979, each single person on invalidity benefit would receive an extra £35 a week and each couple would receive an extra £47 a week. Are not a Government who scapegoat the sick in that way nauseating, weak and hopeless?
Mr. Lilley : If long-term sickness benefit were available only to the number of people receiving it under the last Labour Government, expenditure would be halved. We have allowed it to double in 10 years and to treble in 15 years. We want to ensure that, in future, money is focused on those who are genuinely unable to work because of sickness or disability and that it does not go to those who are able to work and who should be helped back into work on the back-to-work benefits. If the Opposition wish to revert to the old system, from where will they get the money?
Mr. Sims : Is my right hon. Friend aware that there is very strong feeling about the extent to which some people are receiving benefits to which they are not legally entitled? The extent of that was demonstrated by my right hon. Friend's announcement last year that he intended an initiative to save as much as £500 million worth of benefits that were being drawn wrongly. What success has my right hon. Friend had in reaching that target and what steps is he taking to prevent fraudulent claims so that money can go to those who are genuinely entitled to it?
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Mr. Lilley : My hon. Friend makes an important point. There is widespread resentment among people of all parties and none, and particularly among those on modest incomes who are striving to support themselves and to pay their taxes. They feel that some of their taxes are being misused and abused by those who are defrauding the system. I set a target last year for the Benefits Agency of identifying and stopping £500 million worth of abuse. I am happy to say that it exceeded that target and it is well on the way to matching a higher target this year. That will be welcomed by everyone who has at heart the best interests of those who genuinely need help from the benefits system, as well as the best interests of the taxpayer.
Ms Glenda Jackson : Does the Secretary of State intend to review payments to the 1.5 million families who are dependent on income support, in the light of the report published today by NCH Action for Children? According to that report, the £4.15 a week that is deemed sufficient to feed a child is 30 per cent. less than what was spent by Victorian workhouses in 1869, when it was £5.46. Is that not a disgraceful decline in our standards with regard to feeding our children?
Mr. Lilley : For several reasons, that does not ring true to anyone, not least because there is no sum designated specifically for food within the income support system. The sum given is available for parents to decide how they should spend it in the best interests of their families. I believe that the hon. Lady is referring to a figure that might have been implicit in the supplementary benefits system. However, she is somewhat out of date with regard to the reasoning behind the press release. Her allegation that people would be better off if we returned to the Victorian workhouse system discredits the hon. Lady.
Occupational Pensions
2. Mr. Harry Greenway : To ask the Secretary of State for Social Security what was the average value of an occupational pension in 1979, and in the latest year for which figures are available.
The Parliamentary Under-Secretary of State for Social Security (Mr. William Hague) : It is estimated that, at 1991 prices, the average value of occupational pensions was £41.90 per week in 1979 and £63.30 per week in 1991, an increase of 51 per cent.
Mr. Greenway : Are not those figures a matter for congratulation? Will my hon. Friend confirm that more than 70 per cent. of all recently retired pensioners now have an occupational pension, compared with 50 per cent. of all pensioners in 1979? Will he confirm also that the Government will continue their caring Conservatism and look after pensioners on the basic pension, as they always have done?
Mr. Hague : My hon. Friend is absolutely right. Not only did the average income from an occupational pension grow throughout the 1980s but, as he says, the percentage of pensioners who have an occupational pension has also grown to about 70 per cent. of recently retired pensioners. My hon. Friend is right also to draw attention to the importance of state provision of the basic pension. Our policy remains to maintain the value of the basic state pension and to encourage additional provision on top of it.
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Mr. Frank Field : The whole House notes with pleasure the figures that have just been given, but do the Government share the Opposition's concern over the fact that it appears that millions of former pensioners in occupational schemes and in the state earnings-related pension scheme have been badly advised to opt out of those pension schemes? Do the Government regard that as a serious development? If so, what do they intend to do?
Mr. Hague : The extent to which that might have happened has not yet been determined. As the hon. Gentleman will know, my right hon. and hon. Friends in the Treasury have asked the Securities and Investments Board to undertake a review. If such bad advice has been given, the Government will take it extremely seriously and will look to the Securities and Investments Board to come up with proposals to remedy what has happened.
Mr. Jacques Arnold : Will my hon. Friend confirm the amounts over and above inflation to be paid to pensioners to protect them from the imposition of VAT on fuel?
Mr. Hague : Yes. My hon. Friend draws attention to an important point. In the forthcoming uprating of the state pension, 50p per week will be given to single pensioners and 70p per week will be given to couples over and above the normal uprating in order to give extra help with VAT on fuel.
Child Support Agency
3. Mr. Hain : To ask the Secretary of State for Social Security if he will now abolish the Child Support Agency.
Mr. Hain : Will the Secretary of State respond to the detailed and devastating indictment of the operation of the Child Support Agency by a victim, one of my constituents, Mrs. Carol Jenkins? She showed that the pre -Christmas changes that were announced by the Government were mere window- dressing. Many families are still suffering chaos and heartache. The operation of the CSA is contrary to natural justice in that it is retrospective and overturns court orders, some of which were implemented seven or eight years ago. Has the time not come to wipe the slate clean and abolish the Child Support Agency, which is turning thousands of ordinary, decent men and women into a new oppressed class?
Mr. Lilley : The hon. Gentleman seems unaware--I hope that he is becoming aware and will pass on my answer to his constituent--that the changes that were announced before Christmas, in rapid response to the investigations that were carried out by the Social Security Select Committee and that, in some respects, went rather further than it recommended, are to be introduced into the House shortly. I hope that they will come into force on 7 February. Obviously, when they do so, those who are affected by them will appreciate the benefit. As for scrapping the agency, that would deprive hundreds of thousands of women of the prospect of reliable, regular and substantial maintenance. It would mean that men would no longer be expected to fulfil their obligations to their children and that taxpayers would have to pay sizeable sums, which the Opposition are not yet prepared to promise to meet. I thought that the hon.
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Gentleman was a supporter of the feminist tendency within the Labour party. He seems to be backing the male chauvinist wing now.Mrs. Roe : Will my right hon. Friend accept that I and many others welcome the changes to the Child Support Agency which he announced before Christmas? Is he aware that the hon. Member for Glasgow, Garscadden (Mr. Dewar) has proposed a disregard of £10 a week, which would cost £340 million on his figures? Will my right hon. Friend confirm that disregarding maintenance paid through the Child Support Agency for income support purposes would give many married women an incentive to separate?
Mr. Lilley : My hon. Friend makes a good point. We look forward to seeing whether the Opposition Front-Bench spokesman is prepared to utter that pledge in the House, in which case we can take it seriously, or whether it is in the category of pledges made outside the House which we should disregard entirely. The extra taxpayer expenditure of £340 million proposed by the hon. Member for Glasgow, Garscadden (Mr. Dewar) would not alleviate one penny of the burden on the absent parent, but it would create an incentive to separate in exactly the way that my hon. Friend suggests. I do not think that that is necessarily the best use of taxpayers' money. We await the opportunity for a supplementary question to provide some clarification from the Opposition Front-Bench spokesman.
Mr. Alex Carlile : Does the Secretary of State appreciate that in the negotiation, usually at arm's length, of most clean-break settlements, extra allowance of capital is made to the wife to reflect the cost of supporting children? Does he agree that, while there have been useful changes to the CSA regime, they have failed to give full account to the real intention and effect of clean-break settlements land have undermined the good advice frequently given to spouses at the break-up of marriage?
Mr. Lilley : I would recommend that the hon. and learned Gentleman read the letter from Nicholas Mostyn of the Family Law Association in The Spectator , which considers the issue in detail. He should also consider the ruling in the Crozier case--
Mr. Carlile : The Minister is obviously missing the point.
Mr. Lilley : The hon. and learned Gentleman may disagree with the judge in the Crozier case, who said that the courts always have the opportunity to take into account the fact that either parent could come back and seek a change, as could the Department of Social Security, if the parent is left on benefit. The courts have always looked to clean-break settlements between husband and wife, but there has never been the possibility of a clean break between parents and childen. Parents cannot divorce their children ; nor should they seek, by an asset transfer, to transfer the cost of maintenance to the taxpayer if they have the necessary resources themselves.
Sir David Madel : When the Child Support Agency draws up an assessment, why does it ask for income details of the second wife when she has no children of her own? Could my right hon. Friend look again sympathetically at the point made by the hon. Friend the Member for Chelmsford (Mr. Burns) in the last Social Security
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questions, which is that travel-to-work costs should be considered because it costs a small fortune to commute from Essex or Befordshire to London?Mr. Lilley : The second wife's income is taken into account only in the context of setting the protected income. As hon. Members will know, under the proposed changes, the protected income is being raised by £22 per week above the previous level. On reviewing that, I have decided that the information need no longer be given to the first parent when the protected income does not come into play. That will reduce the transfer of information, which caused some stress when it was unnecessary.
We considered, as did the Select Committee on Social Security, the possibility of taking into account specific costs, but we thought that it was better to leave people with an appropriate share of their income after meeting their burden, and to meet the other costs from that income, rather than specifying each and every cost that they should meet.
Mr. Ingram : Has the Secretary of State had an opportunity to read the recent analysis of the Child Support Act 1992 produced by the citizens advice bureaux in Scotland? While recognising that certain benefits can accrue from the Act, the CABs call for
"some serious amendments in order to produce a workable scheme that will benefit the family and not merely the State".
Will the Secretary of State accept that observation and undertake a thorough and urgent review of the Act, and introduce amendments that will take account of the many criticisms that have been raised by the CABs and other groups about the workings of the Act?
Mr. Lilley : I have not personally seen the CAB Scottish review, although I dare say that my hon. Friend in the Scottish Office has done so. I will look at the review afterwards.
The Government have carried out our review and we have responded to a review carried out by the all-party Select Committee, and we have gone somewhat further in some respects. We are introducing it before the House and, I hope, implementing it rapidly in February so that the pressure points that we have identified will be alleviated. We want to know from the Opposition--the hon. Member for Glasgow, Garscadden (Mr. Dewar) failed to respond to this--whether they are sticking by their £340 million pledge, which would not help absent parents at all. Why did not the hon. Gentleman respond? Will the Opposition's other Front-Bench spokesmen clarify the situation? Are they reneging on the recommendations of the all- party Select Committee?
Mr. Cormack : I welcome the changes that my right hon. Friend will introduce on Wednesday, but I urge him to continue to monitor the working of the agency carefully to ensure that responsible fathers are not unduly penalised and that vast numbers of second marriages are not thereby put at risk.
Mr. Lilley : As my hon. Friend knows, we keep all our policies under continuous review. We shall try to ensure that the detailed operation of the policy is as sensitive and as efficient as possible, and that as few mistakes as possible--ideally, no mistakes--are made. We hope that the changes that we have announced will meet the pressure points that have been identified and brought to our attention, both by the Select Committee and by individual
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hon. Members such as my hon. Friend. We have done what is right to make the policy acceptable while preserving the basic principle that both parents are responsible for supporting their children, and that the taxpayer should be involved only if the parents do not have the means to do so.Child Support
4. Mr. Wicks : To ask the Secretary of State for Social Security how much child support is estimated to be collected in 1993-94 ; and what proportion of this will represent a net increase in incomes for one-parent families.
The Parliamentary Under-Secretary of State for Social Security (Mr. Alistair Burt) : The amount of child support maintenance originally estimated to be collected is £530 million. The actual amount will be lower, but it is not possible to provide an accurate revised figure, since the full impact of the proposed policy changes is not yet known. Similarly, it is not, therefore, possible to estimate the proportion of this amount which will represent a net increase to lone parents.
It is important to remember, however, that all maintenance paid is of benefit to lone parents as it forms an income that can be used as a stepping stone back to work.
Mr. Wicks : Is not it the case that only £1 or so out of every £10 goes to improve the living standards of mothers with children? Therefore, is not it the case that the vast bulk of the money goes to the Treasury, and that in reality we have not a Child Support Act, but an Exchequer Support Act? Does the Minister accept that those of us who support the decent principle of parental responsibility will now need to defend the measure against the bad practice that is undermining that principle? Will he reform the measure to ensure that the vast proportion of money goes through to mothers with children, and that we have in reality a Child Support Act?
Mr. Burt : There are two points to be made. First, if the hon. Gentleman had read the Select Committee report, he would have seen that it found it a perfectly worthwhile objective of the agency from the start to seek to recover payments to support the taxpayer. The report states :
"The Committee believes that taxpayers have for too long been asked, in effect, to pick up maintenances bills that should have been met by absent parents."
That is the intention behind the legislation.
The second, and equally important, point to make is that establishing a maintenance payment early, even if there is not an immediate pound-for- pound benefit, is important. Most lone parents want to go back to work, and they find that what stops them from doing so is not having an income such as maintenance being available from an early date. There was no advantage in their getting that before, but now they can establish that early link of maintenance. When they go back into work as their children get older, maintenance will have been established and that will be an important factor.
Mr. Congdon : Does my hon. Friend agree that many taxpayers will be pleased to see that the responsibilities are being passed on to absent fathers under this welcome legislation? Does he also agree that it would be more helpful if sections of the media spent less time concentrating on the problems of absent fathers, and more time exposing the benefits to the mothers who are left bringing up the children on their own?
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Mr. Burt : One or two cases are now coming through in the media-- there have been a couple today--showing how the CSA can work to the advantage of mothers. There has been an over-concentration on the other side. The media also tend to fail to bring out the fact that in 96 per cent. of all cases in which the CSA is involved, benefit is being paid to the parent with care of the child. That means that, whatever the income or circumstances of the absent parent, the parent with care has been left dependent on everyone else and on the taxpayer. The agency was set up so that it could seek to relieve that burden on taxpayers. We are all happy to pay for children when no one else can, but we all want to ensure that parents live up to their responsibilities.
5. Mr. Kevin Hughes : To ask the Secretary of State for Social Security what responses he has received to the proposed changes to the child support regulations announced on 22 December.
Mr. Burt : I have continued to receive correspondence from hon. Members and from the public since the proposed changes were announced. The responses cover a wide range of views.
Mr. Hughes : In considering the correspondence that he has received, has the Minister been made aware of the breaches in confidentiality that the CSA has recently made? Is he worried, as I am, about confidential information being given to ex-partners about income and whereabouts? I have one constituent who is now being pestered by an ex-partner because information was leaked to him by the CSA. I fear, and I hope that the Minister shares my fear, that violence could be introduced into a situation following such leaks of information. Will he put an immediate stop to those breaches of personal liberties?
Mr. Burt : Like everyone else, the agency operates under the Data Protection Act 1988. Making available information about income is a vital part of what is done. It was done in the courts previously, when the only way to ascertain how much the other party had so as to determine the amount of maintenance was affidavit. There was free transfer of that information. That goes on now and is covered by the Data Protection Act. Whereabouts should not be released. Where that happens, it is wrong. I will take steps to ensure that it does not happen.
Mr. Burns : Does my hon. Friend accept that it is premature to prejudge the effects of the changes that he announced just before Christmas in a swift response to the anxieties expressed in the Select Committee report? Can he give an assurance that once the regulations are in operation, if it is seen that there are still problems--for example, commuter fares within the home counties are a significant monthly expenditure--his Department will be prepared, as part of on-going monitoring, to look again at such problems?
Mr. Burt : My right hon. Friend the Secretary of State made it clear that the policy remained under review. That was always our purpose from the outset. However, I suggest to my hon. Friend that he looks carefully at what the Select Committee said in response to my evidence to it on specific expenses. The desire was to ensure that a certain proportion of income remained with the absent parent. What was an important expense to one was not necessarily an important expense to another. Simply to list a series of expenses that might be appropriate to absent
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parents would run the risk of driving the priority of maintenance to the child back down to where it was under the previous system. That is why we preferred to go for the system that we have now. That explanation was accepted by the Select Committee.Mr. Rooney : In drafting the proposed changes, which will be debated soon, and recognising that the assessment of absent parents' income is based on net income, are we to assume that every case will be reassessed following the massive tax increases on 1 April, when all absent parents' income will fall?
Mr. Burt : It remains open to any party to seek review of the assessment if there has been a change of circumstances. It should be made clear that that form of assistance was not available under the previous system, under which it was much more difficult to obtain a review. The continual raising of the position of the absent parent ignores the importance of the whole system to parents with care of children. It is important that the Government make sure that there is a balance. That is what the Child Support Act 1991 set out to do. Far too many complaints and concerns are raised by people who do not understand the importance of ensuring that parents with care of children receive adequate, regular and reliable maintenance. That did not happen before.
Mr. Sykes : Will my hon. Friend ignore the carping from Opposition Members and instead congratulate the Child Support Agency on pursuing errant fathers who have no intention of facing up to their responsibilities and prefer the rest of us to pick up the tab?
Mr. Burt : A less well-known fact about the Child Support Agency is that, unlike the previous system, it has a tracing function. In the past, when full information about an absent parent could not be given, that parent used to go completely to ground, leaving the burden on all the other taxpayers and leaving a parent to care for the child without any support. We now have a system whereby he or she can be traced and about 15,000 have been found, which represents a 90 per cent. success rate. I should have thought that that would merit some support from Opposition Members.
Mr. Dewar : Do Ministers really argue that the possibility of a disregard should not even be on the agenda for discussion or be examined in the context of present discontents? I have argued precisely that on a number of occasions and that argument was also put forcefully by the Social Security Advisory Committee in its latest report. Has the Minister considered the Australian precedent of introducing a review officer who, in certain defined circumstances, can order a departure from the normal financial formula if that is justified by exceptional circumstances? Will he take it from me that a large number of hon. Members feel that if the present package--due to come before us on Wednesday--is seen as the final word, the system will forfeit public confidence in the most damaging way and also that every system needs a safety net, which has not yet been provided?
Mr. Burt : The point about the review that the hon. Gentleman recommends is that the Australian system is completely different from ours ; it is much more incomplete and far more rough and ready and the right of appeal is not available to everyone. He is asking us to
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substitute a much more imperfect system merely to give a relatively small number of people the opportunity to appeal.On the second point, as my right hon. Friend the Secretary of State said, the disregard that the hon. Gentleman suggests does not relieve the absent parent from any burden, but it increases the burden on the taxpayer by however much he wants to include in the disregard. The hon. Gentleman is reputed to have suggested about £340 million for that sort of payment. I notice that he has not responded to the challenge offered to my right hon. Friend.
Can the House take it that the hon. Gentleman is giving a pledge in the House?
Mr. Dewar indicated dissent.
Mr. Burt : I find myself in some confusion if the hon. Gentleman is prepared to say something inside the House but not to stand by the pledge. The House and the whole country will have noticed his shifty nature.
Mr. Bates : Does my hon. Friend agree that the greatest scandal to be brought to light by the work of the Child Support Agency is that 660,000 of the first 1 million cases involved an absent parent who was not paying one penny in contributions towards their children? Will he ensure that, whatever the changes proposed, they will not affect his and the Child Support Agency's ability to tackle the greatest of all injustices?
Mr. Burt : It has been a concern to those who have been paying and asked to pay more that the agency is seen to be going after only that group of people. In referring to the expected number of cases taken on by the end of the first year, of which about two thirds of a million will be people who have not paid any maintenance, my hon. Friend seeks to redress that argument. It is clear that we are determined to ensure that those people who have not been paying towards the care of their children do so and that is a good reason why the agency should continue with its work.
VAT (Fuel)
7. Mr. Dowd : To ask the Secretary of State for Social Security what arrangements have been made to compensate people who rely on wheelchairs and other electrical devices for their well-being, following the introduction of value added tax on fuel.
The Minister for Social Security and Disabled People (Mr. Nicholas Scott) : The cost of electricity for equipment used in the treatmentof illness at home, such as dialysis, is met by the local health authority or NHS trust. That does not apply to electrically powered wheelchairs, but around 80 per cent. of disabled people will receive extra help for VAT on fuel through social security benefits.
Mr. Dowd : I thank the Minister for that reply. Does not he realise that, while compensation for those hardest hit by the imposition of VAT on domestic fuel is inadequate in any case, it strikes those with disabilities especially hard? Is he aware that the department of applied economics at Cambridge university has shown that the average spent on domestic fuel by households that include members with a disability is up to one quarter higher than that spent in a traditional household? Is not it characteristic of the Government that their taxation policies rely on soaking
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those in the community who are least able to bear it and taxing people for the privilege of being able to move around in their own homes?Mr. Scott : Help with VAT, including direct help through special payments, exceptional cold weather payments and energy efficiency, will cost about £2.5 billion over the next three years. That, if I may say so, is vastly in excess of anything offered by the Opposition, who were talking of some 50p a week being adequate for those purposes. As the hon. Gentleman mentioned powered wheelchairs, I might add that the average extra cost as a result of VAT for the average user will amount to about 76p a year.
Dr. Spink : Will my hon. Friend confirm that planned funding on sick and disabled people for this year will be £16.5 billion? Will he confirm that that is an increase of some 300 per cent. in real terms and is three times higher than the amount that was spent on sick and disabled people in 1978-79? Does not that show the Government's commitment to helping sick and disabled people?
Mr. Scott : My hon. Friend puts his finger exactly on the point. While I well understand the pressures on both sides of the House for us to do better in meeting the needs of disabled people and enabling them to have a higher quality of life, it comes a bit thick from the Opposition when they failed disabled people in many ways when in office. As my hon. Friend reminded us, we are now providing three times as much help for disabled people as was ever provided by a Labour Government.
Child Care Allowance
8. Mr. Duncan Smith : To ask the Secretary of State for Social Security how many additional people he expects to return to work as a result of the recent introduction of a child care allowance in family credit.
Mr. Lilley : We expect 50,000 families to take up work and be better off as a direct result of the change.
Mr. Duncan Smith : Will my right hon. Friend confirm that the child care allowance is not only available to those on family credit but to others such as those on disability working allowance? Does he agree that it is a tremendous leap forward in helping working families to get back to work--both partners?
Mr. Lilley : My hon. Friend is correct. As well as a disregard of child care costs in family credit, it is also available in disability working allowance and to some people on housing benefit, as well as council tax benefit. We believe that it will not only draw back into work some 50,000 people--perhaps more if more people than our cautious assessments respond to it--but it will also help some 100,000 families where one parent is already at work and on family credit, perhaps to increase their hours and the standard of living of that family. We think that it is a positive change which has been widely welcomed.
Mr. Bradley : Will the Secretary of State confirm that, as the child care allowance is a disregard against family credit, the lowest income families, who already receive their full entitlement to family credit, will receive no help whatever with their child care costs under the scheme?
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Mr. Lilley : In general, those who earn least and therefore receive most family credit are those who work the shortest hours. They, of course, will be helped to work longer hours by being able to meet some of the costs of child support. That is precisely one of the reasons for introducing the changes.
Mr. Willetts : Does my right hon. Friend accept that nearly half of all recipients of family credit are single parents? Does not that show how effective the benefit is in ensuring that they get into work?
Mr. Lilley : Absolutely. Although family credit is not exclusively geared to help lone parents, it helps them disproportionately. It will help also married couples where one partner is disabled and unable to look after the children. It is a much more significant change than the rather grudging comments from the Opposition Front Bench. Indeed, it exceeds the request of the Daycare Trust for a £35 disregard by offering a £40 disregard.
VAT (Fuel)
10. Mr. Pickthall : To ask the Secretary of State for Social Security what is the amount in cash per week of the compensation for value added tax on fuel, over and above the general income support increase, for a pensioner on income support.
Mr. Hague : In April, income support will increase by an extra 50p per week for single pensioners and 70p for couples. By April 1996, the extra for VAT will be worth some £1.40p and £2.00 per week respectively.
Mr. Pickthall : Does the Minister agree that although most means- tested benefits will be upgraded in April by 3.9 per cent., which includes the 4 per cent. VAT compensation, retired pensioners on income support or those in receipt of invalidity pensions will receive an increase of 3.5 per cent. on their pensions, plus 50p if they are single or 70p if they are a couple? Does he agree that that amounts to 26p extra per week? Can he estimate, for the benefit of the House, how much gas, electricity or solid fuel could be bought by that most needy and fuel-dependent group in our society for 26p, the price of a packet of crisps?
Mr. Hague : The hon. Gentleman has got his arithmetic a little mixed up. When considering the 50p or 70p per week extra that will be given to pensioners to help with VAT on fuel, it would be illogical to deduct the extra amount that is also given in income support. All pensioners, whether in receipt of income support or the full basic pension, will receive 50p per week if they are single or 70p if they are a couple.
The total income support rate for pensioner couples will rise by £4 per week from £95.25 to £99.25, which is an increase of 3.9 per cent. That is a lot more than that received by many people in work. All that adds up to a package which is a good deal more generous than that famously suggested by the Opposition, who said that they could give that help through an extra 50p on pensions.
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CHURCH COMMISSIONERS
Investment Priorities
29. Mr. Simon Hughes : To ask the right hon. Member for Selby, as representing the Church Commissioners what are the investment priorities for the Church Commissioners for 1994.
Mr. Michael Alison (Second Church Estates Commissioner, representing the Church Commissioners) : The Church Commissioners have accepted the Lambeth report's recommendations that they should seek to maintain a portfolio that is not markedly different from that of other major bodies with comparable responsibilities. That is their long-term priority. The immediate priority is to let newly completed developments and to reduce unsecured borrowing. The commissioners also propose to take steps to adjust the imbalance between prospective sustainable income and likely expenditure.
Mr. Hughes : I am grateful for that full and helpful reply. If the right hon. Gentleman accepts that the twin planks of an acceptable investment policy should be to maximise returns to pay stipends and pensions and to behave in an ethical Christian manner, will he reflect on the fact that, last year, hundreds of millions of pounds were lost as a result of the Church Commissioners' investment policy and that it has now been decided to increase the rents of the tenants of the Paddington Churches housing association by 20 fold? Those two facts represent a failing in good investment terms and in terms of Christian ethics. If the sums involved had been public money, the Church Commissioners would have been brought before the Public Accounts Committee and would have probably been given a rough time. Would the commissioners agree to let an independent organisation look at their investments, possibly the Ecclesiastical Committee of this House and the House down the road?
Mr. Alison : The hon. Gentleman will know, going back to the capital losses, that between 1986 and 1989 the value of the assets held by the Church Commissioners increased from £2.2 billion to £3 billion, an increase of £800 million, but that between 1989 and 1992 the value of those assets declined by £800 million from £3 billion to £2.2 billion. They are now in the process of increasing again and the value of the stock exchange portfolio has already gone up this year by nearly £200 million.
The real difficulty about the change in the underlying value of those assets is cash flow. Everyone is worried that the clergy will be unable to receive their stipends. That is one reason that the yield from the assets must obviously be increased, even through rent increases.
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