House of Commons Hansard Debates for 14 Feb 1995

Mr. Duncan: Stooge though the hon. Member for Garscadden might label me, I assure the hon. Member for Renfrew, West and Inverclyde (Mr. Graham) that it is not my Government. I do not accept his thesis. Socialist Scotland has denied many opportunities to those who wish to be in work.

Let us take the hon. Gentleman's starting point of 1979 and look at the Rowntree report, which based its thinking on that starting point. In a so- called "scientific" exercise, it simply took a household incomes survey and extrapolated it through some extraordinary set of contortions to reach the conclusions that have been broadcast widely over the past couple of days. In 1979, punitive taxation so suppressed, reduced and squashed the earnings of the so-called rich that it was inevitable, to return to a modicum of sanity, that in the years that followed the diversity between the extremes of those who earned a little and those who earned a lot would widen. So what? It is good for prosperity that that should happen.

Furthermore, over those 15 years, the Rowntree report took a moving target for the purposes of making comparisons and drawing conclusions. The definition that it used to say that inequality had increased had itself moved for ever upwards. Therefore, to argue that the poor have got poorer is a falsity. Only because it was a comparative figure for ever moving upwards in the 15 years of the survey was Rowntree able to draw that conclusion.

The Rowntree report revealed a tale of two systems: a system of progress and enrichment based upon capitalist behaviour, which has been shown to work, and an alternative system of welfare, which by comparison has gradually impoverished those who have become increasingly dependent on that system.

Let me once again look the hon. Member for Garscadden in the eye to prove to him that I am not the stooge that he so loves to label me. Let me advance what I believe would be a solution to the way in which those he pretends--and perhaps genuinely wishes--to help have been impoverished, which perhaps is not fully in tune with Government policy.

The Social Security Select Committee has done much work on what should be the future of the welfare system in Britain. We have not considered it in as much detail as I would have liked. One of the problems of the welfare state is that many people have become increasingly trapped by so many conflicting influences in the various

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different benefits that are distributed by different offices. We need to address that problem. One solution would be to have a citizens income.

The hon. Gentleman might not have expected to hear this from me, but I favour a citizens income whereby, regardless of people's means, condition or predicament, someone would be guaranteed a basic wage of, for example, £50 a week. That person would be freed from benefit traps, distortions of labour markets and everything else that impoverishes the category of Britain about which he could have spoken more today.

Beveridge said in his principles:

"The state, in organising security, should not stifle incentive, opportunity and responsibility. In establishing a national minimum, it should leave room and encouragement for voluntary action by each individual to provide more than the minimum for himself and his family."

At the moment, that principle is not being delivered in practice. If somehow across the Floor of the House the parties can find some common ground for alleviating poverty, we will have done the country a great service. However, we are not going to find it simply by making great political noises and talking only of inequality, which has nothing whatsoever to do with poverty and diverts attention and proper thought from all our duty: to help those who are poor to the best of our means and not to use them as some Opposition Members risk doing--as political pawns for their own political objectives. 7.33 pm

Mrs. Helen Jackson (Sheffield, Hillsborough): I am grateful for the opportunity to add my voice to the growing public concern about the divide in society.

Last night, I attended a meeting in my constituency of parents and governors who were concerned about the cuts in schools and the effect that would have on class sizes. The unanimity in that hall and the despair about the damage to the fabric and the future of society was such that one of my constituents pleaded with me that we in the House should forget party politics and agree to halt the deepening crisis. If that constituent had been here this afternoon, he would have realised that it is not so easy.

The Rowntree report, which was published last week, is simply a further particularly authoritative report about the bald facts of the growing divide of income, poverty and wealth in Britain, but it is not even recognised by Conservative Members.

Government statistics--most of the reports are based on Government statistics--analysed back in December by the Low Pay Unit show that the disposable net income of the bottom tenth of the population after housing costs had dropped by 17 per cent., while the top tenth showed an increase of 52 per cent. The report is further evidence of that fact. It leaves Ministers clinging desperately to the statistic of the average, the median and the mean--as the Prime Minister did this afternoon--because that is how they can disguise and hide the deepening divide. Average statistics may be all right, but the Government increasingly use them to mask the truth or flounder in waffle about self-employed accountants in the bottom wealth decile. If deepening relative poverty is universally recognised, except by Conservative Members, Rowntree has shown us the hopelessness of absolute poverty. There is no question about some of the examples in the report that we all know

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well. The pensioner couples living on £63 a week are straight poor. It makes a nonsense of the Government's frequent insistence that they are about providing choice. If people are poor, they do not have the choice of private health care or education; they do not have the choice of where to go shopping. They have to take the cheapest possible route.

I am not interested in looking only at the bottom end of the scale; we must also examine the 20 per cent. of people at the top of the scale. I well remember doing just that in Sheffield when the poll tax replaced the rates. In the leafy suburbs of south-west Sheffield, that change represented tax windfalls of up to £2,000 a year. At that time, such a windfall was being enjoyed by a number of Conservative councillors on the council. The council tax never righted that injustice, but every time an essential charge supplants one that is wholly or partly met by tax revenue, the wealthy benefit and the poor struggle to pay or do without.

The examples are too numerous to count. Prescription charges of £5 do not hurt the people in the top fifth of the income scale, but are a struggle for people in the bottom fifth, who may go without. Deregulation of bus fares is no problem for those who have two cars and do not use public transport, but those who are poor struggle or do without. What about water meters? It is no problem for those on a high rateable value to have a water meter, but those charges matter for people who are poor and have large families. That was behind the anger on VAT on fuel. It was thrown out so convincingly because it was a charge on an essential service.

Where do we start? I suggest that in the first instance we have to examine three areas. We must, first, look at wages, salaries and income. At the bottom end of the scale, we believe that a minimum wage adds dignity to people's efforts in the workplace. It tames the excesses of the free market, whereby people are asked to work for as little as they feel they can possibly manage. They survive on the crumbs. There is no reason in a free market why people should not work for 50p or £1 a hour if the market will stand it, but that is not okay for the dignity of people's efforts. Most employers agree that the minimum wage adds efficiency to the workplace and does more than any other penalty system to reduce the problems caused by the working of the cash-in-hand, black economy for the poorest tenth of the population.

It is simply not on to say that the salaries of the top executives and chairmen of public utilities, whose incomes are derived from our electricity, gas, and water payments, should be left to company shareholders to decide. Our money is being creamed off in totally obscene and excessive salaries, share options and pay rises way above the sum that any British household today requires to enjoy a high standard of living.

We must control the top level of wages and salaries. An unfair system breeds increasing unfairness. That was evidenced by the public pay round last year, under which the nurses received a pay increase of 1 per cent., the doctors received 2.5 per cent. and senior civil servants received £150,000 or whatever they deserved according to performance pay. An unfair system puts pressure on the public pay rounds to increase that unfairness, not just for those at the top and the bottom of the wage and salary scale but for those in the middle as well.

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We must address the question of equal treatment for all. The Fawcett Society and other pressure groups concerned about equality believe that, if the Government continue on the course outlined in the Pensions Bill, two out of three women who will retire after the year 2030 will live in poverty. The Pensions Bill, which is now being debated in the other place, passes over the needs of part-timers, divorced women and housewives. They are denied any real benefits which will flow from that pensions reform. An enormous opportunity has been lost.

As we saw last Friday, the Government are unable or unwilling to do anything meaningful for the disabled. The incapacity for work legislation will affect those on invalidity benefit as well. We must recognise the role that public services play in determining standards of living. I was shocked to hear that the Government propose to bring down the shutters on one more tenuous, but valued, route out of poverty--the 21-hour rule, by which people can gain entry to adult education courses. That is an appalling proposal. It shows that, unless core public services are valued as being integral to our standard of living in Britain, the present divide between the rich and the poor will remain for a very long time.

7.43 pm

Mr. Alan Howarth (Stratford-on-Avon): The Rowntree report should be a landmark in our public debates. Its tone--calm and reasonable, but earnest and urgent--is in the best traditions of Rowntree and the data that it assembles give us much food for thought. In October 1993 I wrote an article in The Guardian in which I said that trickle-down theory had not worked out for the poorest 10 per cent. of the population. It gives me no pleasure that the Rowntree report powerfully endorses that observation.

I shall not repeat the statistics that have been quoted so often today, but they confirm that the standard of living of households on the lowest incomes has not risen since 1979 and that the dispersion of income has widened greatly. My right hon. Friend the Secretary of State for Social Security made a characteristic speech on that subject last November, blending his intellectual rigour with his humane concern.

The Conservative party need not apologise about the main thrust of economic policy in the 1980s. It was in the interests of all of our people to bring down inflation, balance our public finances, deal with some of the rigidities of the labour market and provide managers with the opportunity to manage. We never pursued what the hon. Member for Dumfermline, East (Mr. Brown) called in his article in The Independent on Sunday "simple-minded" free market policies. We were not so naive as to suppose that the untrammelled operation of market forces would optimise social outcomes, and there has been massive intervention and expenditure by the Government in the inner cities, on the education system and on social security--and rightly so.

Of course, we have not found all of the answers and the policies that are appropriate in one phase of our development may become less appropriate in another phase. We may need to alter the emphasis. We should

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certainly not pursue the reduction of taxation or the reduction of public expenditure as a proportion of national income to the ultimate, and I suggest that we should be extremely cautious about further deregulation.

In its leader last Saturday, The Times offered siren advice. It said that the Rowntree findings were "dubious" and it even accused the authors of manipulating the data. It asserted that inequality in Britain was within the bounds of the tolerable. Even at 20p a copy, I fancy that The Times is expressing very much a minority opinion. It did find three academics to offer comfort to the complacent--Messrs. Minford, Anderson and Green: see no evil, hear no evil, speak no evil. Admittedly, Professor Minford observed that it is a "savage world".

It is indeed a savage world, and we must respond to that. Our policies must emphasise healing the divisions within our society. It is perhaps all too predictable for me to quote Disraeli, but in "Sybil" he wrote of

"two nations between whom there is no intercourse and no sympathy, who are as ignorant of each other's habits, thoughts and feelings as if they were dwellers in different zones or inhabitants of different planets".

If any hon. Members are tempted to think that that is a purple passage from a Tory Member of Parliament who turned his hand to writing novels because he had nothing better to do, they are wrong. I refer them to chapter 6 of volume 2 of the Rowntree findings if they need to be persuaded that the problem of the two nations is still with us.

The section on "The Location of Poor and Rich Neighbourhoods" shows that there was a concentration of poverty in 8.9 per cent. of wards in this country in 1991, compared with 7.5 per cent. in 1981. Far too many of those wards are the same in both surveys.

Other research shows concentrations of poverty, in Oxford and Oldham, which are geographically cheek by jowl with areas of affluence. They are worlds apart in terms of income, yet extremely close together geographically.

In 1872 Disraeli concluded that the "great object" of the Conservative party should be

"the elevation of the condition of the people".

In 1965 Iain Macleod, addressing the Conservative party conference, reiterated those Tory values when he said:

"We shall be called upon to convince the electorate that we stand for humanity as well as efficiency; for compassion as well as competition".

Latterly, we have perhaps been at risk of neglecting that balance and I think that we should attend to its restoration. That Tory tradition is the authentic Tory tradition and it is the only one to which the voters of this country will give continuing loyalty. Perhaps not many voters read Coleridge, but he observed to Harriet Martineau, an eager radical, that

"Society is not an aggregate of individuals".

It is the role of Government to maintain the cohesion of society--a society that embraces all its members. Extremes of inequality are not acceptable. My right hon. and hon. Friends should note very carefully the outrage that is being expressed at the extremes of pay increases and rewards that are being reaped by the directors of some privatised companies. It is not the politics of envy; it is the politics of fairness. I put it to my hon. Friends that they should not insist that only absolute poverty matters. Relative poverty matters very much indeed because we define ourselves as members of society.

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Certainly, our Government should not practise the politics of exclusion. It is wrong to propose in the Jobseekers Bill that some young people should live on £21.70 a week, or even nothing at all if they are sanctioned. It is wrong to chip away at national insurance and the contributory principle, because they are the keystone of our social contract. It is wrong that in the Disability Discrimination Bill we should exclude from the scope of protection people who happen to be employed in firms employing fewer than 20 people.

My right hon. Friend the Secretary of State for Wales observed in an article recently that "markets are social events", as no doubt they are-- for those who can get to market. But if the Disability Discrimination Bill largely ignores transport, the disabled will not be able to get to the party or to the labour market. I use the term "labour market" because it is the term that we all use, but we might care to reflect that its dehumanised language may tell us something about our own deficiencies. I do not know whether my right hon. Friend considers the foreign exchange markets as social events, but it strikes me that those young men with their braces and champagne omit to invite the low-paid to their exclusive celebrations. Efficiency is not the same as fairness, and unfairness is inefficient. If people are to be excluded from our society through unemployment or marginalised through low pay and low skills, we deprive ourselves of their talents and potentialities. The costs of maintaining law and order, of repairing our inner cities or our social fabric are immense. Indeed, as my right hon. Friend the Secretary of State for Social Security grimly points out, they are unsustainable. Nor would I wish to sustain the present pattern, and indeed we shall not, of course. Only the extreme short-termism of the Treasury could provide an open-ended subsidy for low pay by way of family credit. We can see it coming: next year's public expenditure crisis will be about family credit, just as this year's--allegedly, at least--is about housing benefit. Mr. Howard Davies was right to say that inequality is a sign of a malfunctioning economy.

If my hon. Friends are not moved by the thought that poverty is a drag on the economy, let them consider what it does to families and children. We find five times the number of children on at risk registers in the poorest areas compared to the better-off areas. There is an estate in Wales where only 7 per cent. of adults are in full-time employment. How can they provide role models for the children? The disadvantages that those children suffer early on--in terms of language skills and health, for example-- persist. They are our future. There is an obligation from one generation to the next. As Burke said:

"Society is indeed a contract . . . a partnership . . . between those who are living, those who are dead, and those who are to be born."

The Conservative party must accept the need for public investment, in the interests of us all, in those services that are not going to be privatised. We should not--we could not--privatise education. If we devalue our schools, as I fear that we shall in this year's local authority settlement, it will be as damaging to this generation as devaluation of their money through inflation was to a previous generation. Education is crucial in terms of opportunity--fullness of life--for every individual. It is crucial in terms of the quality of our future society, and in terms of our future competitiveness.

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7.53 pm

Ms Jean Corston (Bristol, East): The Rowntree report is no surprise to those who have followed the course of changes in income and wealth in the past 16 years. Even official Government published statistics make the growing gap between the rich and the poor indisputable.

The growth of inequality is no surprise to the Government either. Several times in the past 18 months a succession of my right hon. and hon. Friends have asked the Prime Minister to confirm both growing inequality and poverty. Since 1979, the average disposable income of the richest 20 per cent. of households has increased by £6,000 a year, at April 1994 prices. But the average disposable income of the poorest 20 per cent. of households has fallen by £3,000 a year, compared with the incomes that they would have received if policies and the distribution of earnings had stayed the same. That is one way of bringing out the dramatic and unprecedented growth of inequality in Britain.

The Prime Minister told me, none the less:

"The net disposable income of people at all ranges of income has increased".--[ Official Report , 22 February 1994; Vol. 238, c. 146.] He told the late Leader of the Opposition, John Smith:

"There is an improvement in living standards at all levels, even among those who are the least well off."--[ Official Report , 24 February 1994; Vol. 238, c. 428.]

That was untrue then, and it is untrue now. After the exchanges in the House, which other hon. Members as well as myself have sustained to this day, I wrote a detailed letter to the Prime Minister citing Treasury and Department of Social Security evidence to show that substantial groups of the population now have disposable incomes which in real terms are lower than such groups had in 1979. He dodged the issue, and continued to do so after I wrote again at length. He replied in August 1994, but he and other Ministers continue to dodge the issue because it is too uncomfortable for them.

Even the 1995 jubilee edition of "Social Trends" no longer has the critical table showing the absolute decline in real income of the poorest 10 per cent. and 20 per cent. of the population--it was table 5.21 in the 1994 edition. I can presume only that Government statisticians were under pressure not to publish that table, or were inhibited from doing so by the deliberate deception now being exercised by the Government as a whole on the issue.

This is a key point in the sorry tale of Tory deceit and prevarication, and one which the otherwise admirable Rowntree report hesitates to drive home. It is not just the growing inequality or poverty, but the smaller real income among millions of poor people. Their incomes are falling and, unhappily, more people are joining them. I do not just mean the rise in the number of homeless people, especially the young homeless, although that is tragic enough, but families with children, the unemployed, those in casual, part-time and self-employment, and pensioners, too.

On 31 August 1994, the Minister for Social Security and Disabled People informed me, in response to a written question, that in 1991-92 the disposable income of the poorest 20 per cent. of families with children, after adjustment for composition and size of household, was lower than that of the poorest 20 per cent. in 1979. We are talking about 7 million people in families with children who are worse off than their 1979 predecessors, whether income is measured before or after housing costs.

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Among the poorest tenth, the situation is even worse. At 1994 prices, the income of a couple with two children aged three and eight was £996 lower in 1991-92 than in 1979, whereas for the same period an identical family in the richest tenth of the population had an extra £14,300 a year income. That is what has happened under the Conservative Government--and the Prime Minister has the brass neck to tell my right hon. Friend the Leader of the Opposition that he agrees that it is a responsibility of the Government to reduce inequality. Even pensioners in the poorest tenth of the population have a lower real disposable income than in 1979. Single pensioners in that category experienced a decrease of £676 a year, and couples £52 a year at April 1994 prices. The Department of Social Security does have a standard of low income in 1979 terms--buried away in the deep recesses of the "Households Below Average Income" report. It is defined as the median income in 1979 of the poorest tenth of the population, adjusted for inflation to the present day. It would be bad enough if, after 16 years, that figure was still relevant to today's conditions, but the situation is worse than that. It is contrary to all the statistics of average growth. It shows that the number of children living below the 1979 standard of low income has increased--from 790,000 to 1,060,000.

The DSS gives another measure of low income in 1979: half average household income in that year. The number of children in families still below that miserable level has also increased--from 1,310,000 to 1,850,000. The same source discloses that the number of people living below the 1979 standard of low income who are in employment has also grown. That group includes more self-employed people and more people in both full-time and part-time work.

A range of statistics that I received in August was published in Hansard on 26 October 1994. When I wrote to the Prime Minister again, he referred the matter to the Secretary of State for Social Security, who did not deny any of the figures that I had put to the Prime Minister. His reply, on 18 December 1994, dodged the responsibility of agreeing on what factual basis we could have a reasoned debate about the implications for action. He added, at the end of his letter,

"The most important point is that the Government should identify what trends underlie the results and put in place policies that ensure that everyone has the opportunity to share in the increasing wealth that the HBAI results show for the vast majority." The Government must recognise that there is a momentum against the poor: a multiplication of tax, social security, employment and deregulation policies which are reducing Britain's poor to third-world status and desperation rather than merely continuing a process of polarisation. That momentum of divergence has been built into the entire range of institutions and policies in this country. It is like a geological fault built into the social landscape, with sections of the population sliding into an abyss.

We can no longer speak only of the deterioration of the conditions of poor people relative to those of others; this is a deep and deepening social divide, with millions losing absolutely rather than just relatively. It is self-destructive social engineering, manufactured by the Government--

Mr. Barry Porter (Wirral, South): Will the hon. Lady give way?

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Ms Corston: No, I have only 10 minutes; the hon. Gentleman can make his own speech.

That self-destructive social engineering is harming the security, the common interests and, indeed, the future prosperity of rich and poor alike.

All that is thrown into stark relief by recent examples of magnified greed. PowerGen's Ed Wallis says that he is worth £1.2 million; British Telecom's Sir Iain Vallance says that his £770,000 salary is "modest"; British Gas's Cedric Brown is revelling in a salary of nearly half a million. Meanwhile, question 18 in the proposed jobseeker's allowance questionnaire asks,

"What is the lowest wage you are willing to work for?" Yesterday, at my constituency surgery, one of my constituents--a qualified chef who used to work for Rolls-Royce--was put in touch with an employer who had a job going in a bakery. He rang up, and was told that the pay was £1.90 an hour. A job was advertised in Bristol just before Christmas at £1.61 an hour. What implications has that for the family credit budget, in which good employers are subsidising bad ones? What implications has it for the "feelgood factor"? Anyone who watched "Panorama" last night would have been shocked to see the difference between the life chances of the rich and those of the poor.

John Maples was right: the people of this country know that the rich are getting richer on the backs of the rest, who are getting poorer.

8.2 pm

Mr. Hartley Booth (Finchley): I understood from the Order Paper that the debate was supposed to be about poverty. Although I respect much of what the hon. Member for Bristol, East (Ms Corston) said, I intend to return to that subject, rather than wallowing in the politics of envy: I want to get away from the whole business of inequality. Equality is not the sole yardstick that we should use when discussing the crucial and often sad issue of poverty. I also wish to set a new analysis alongside that of the Joseph Rowntree Foundation. I have benefited from the excellent work of the House of Commons Library researchers, whom I asked a number of questions about comparative income, benefit and tax figures between 1979 and 1993. As other hon. Members do not have the result of that analysis before them, perhaps I could devote most of the 10 minutes allotted to me to presenting it. I believe that it is illuminating, and puts in context what has been at the core of much of the debate. The hon. Member for Glasgow, Garscadden (Mr. Dewar) said that the Rowntree report was the fons et origo of the debate from Labour's point of view.

According to the Library, in 1979 the income of the top 20 per cent. started at £11,000, and that of the bottom 20 per cent. at about £1,800. When state benefits are added, the figure rises to nearly £ll,000 for the top 20 per cent. and more than £2,000 for the bottom 20 per cent.--in terms of gross income with benefits. When tax is taken off, the income of the top 20 per cent. falls to £8,000 and that of the bottom 20 per cent. is lowered very slightly, remaining at about the same £2,000 level.

Let us then add or subtract--depending on whether we are dealing with the bottom or the top quintile per cent.--the indirect taxes and benefits in kind. That produces a

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figure of £7,800 for the top 20 per cent., and just over £2,300 for the bottom 20 per cent. Thanks to the contribution of the rest of us, the income of the bottom 20 per cent. in 1979 has thus been raised by 30 per cent., while 259 per cent. has been taken from that of the top 20 per cent. by the rest of the community. The gap exists. I need not go laboriously through every stage in the same process in 1993, but hon. Members will know that process: add benefits, take off tax and then deal with indirect taxes and benefits in kind. The top 5 per cent. are now giving the rest of us 290 per cent.: in other words, the tax take from that group has increased by 31 per cent. Meanwhile, the income of the bottom 5 per cent. is up by 28 per cent. The gap referred to by so many Opposition Members is narrowing by 30 per cent., from the top; it is about 2 per cent. in all. I do not want to confuse the House.

Even on those figures--before we employ other yardsticks relating to money and poverty--it is clear that the findings of the Rowntree Foundation, honest and well meaning though it doubtless is, need to be reinterpreted. I believe that poverty should be viewed not only in terms of money and goods, but in terms of ideas. I was grateful to the hon. Member for Garscadden for widening the debate slightly and discussing poverty in those terms, but he did not go on to make the obvious point--he wouldn't, would he; it is a point in our favour--that, while one in eight school leavers went to university in 1979, one in three go now.

The university figures mean that the ladder of opportunity is there for all to see. We have tried to help education in a number of ways--for instance, through the provision of city technology colleges. Apart from a reference at the beginning of the debate, I have heard nothing about that; although, unfortunately, my membership of a Standing Committee meant that I had to be absent for part of the debate.

My time is getting thin, so I shall be quick. The context of our debate has been muddied considerably because we have failed to talk about the reality of poverty as we see it worldwide. No proper reference has been made to the fact that poverty in this country is comparative riches compared with poverty in the third world. A proper analysis has not been made of the various definitions of poverty. Nowadays, apparently, even not having central heating is a criterion of poverty, but there are millionaires without central heating.

Ms Harman: They are not poor, are they?

Mr. Booth: That is why we need to analyse what is and what is not poverty. That is the core of the debate and of our discussion. That is why we need to define it ourselves.

The Bearsden pictures on "Panorama" last night were heart-rending. That is not surprising if one considers what we saw--housing provided by the state, the man who had gone through endless training sessions provided by the state, and the sad woman who was being provided with national health service benefits. All that was a microcosm of the promise of Attlee and of socialism. The scene was poverty-stricken in terms not only of money, but of ideas. Those people's lives had no purpose.

Not surprisingly, we heard in last night's tragic film of a high incidence of suicide. No individuality or uniqueness could live in those drab socialist-inspired

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buildings. There was no dignity there: that is the other aspect of poverty with which I want deal, and with which socialism does not deal. The solutions that Conservative Members have wanted have not been supported by the hon. Member for Garscadden, or by other Opposition Members during the part of the debate that I have been able to hear.

We have not heard that the number of people on the lowest wages fell from 1975 to 1978. We have not heard that there has been a distortion in the figures, thanks to rich people being able to return to this country following the 1979 election. Some reference has been made to this, but we have not heard much about the fact that, thanks to a strong and growing economy, income support has increased by 24 per cent. for a typical unemployed couple, by 18 per cent. for a typical pensioner couple, and by 30 per cent. for a single pensioner.

Equality is not a helpful yardstick; real poverty is. Compulsory equality, ordained by socialism, communism and Opposition Members--if they ever had the chance--is the one sure recipe for poverty. 8.12 pm

Mr. Frank Field (Birkenhead): Like other hon. Members in the Chamber and elsewhere, I rejoice at the increase in incomes since 1979. It would be folly for anyone to deny that basic fact. The debate tonight is different from that. It deals with the impact of rapidly rising incomes. How has that increase been shared? Has it been fair? Is it sustainable? The charge against the Government is, in a sense, a unique charge. It is that, under their stewardship, they have done well in increasing national income, but that a part of the British political tradition has been destroyed.

In the past 400 years, incorporating more people into the body politic has been one of the great movements in politics. Great struggles took place, therefore, for equality before the law, and for freedom before the law. There were the struggles over the franchise. Great efforts have been made in this century to establish greater economic and social equality.

It would have been fair, therefore, to think of British society as being like a train journey. There were first, second, third and fourth-class compartments. The living standards of those in the four compartments were clearly different. One could say with all certainty that the train was heading in the same direction and that all the carriages were linked. The charge that we are making tonight is that, despite the growth in wealth, or perhaps because of the way in which that growth has been gained, the fourth coach has been decoupled and no longer heads in the same direction.

I do not have the statistics that other hon. Members have deployed in this debate. I merely wish to bring some of my constituents and their faces, feelings, hopes and aspirations into our discussions. One can see the faces of the people in that fourth-class carriage, which has been decoupled from the train on the main journey that the rest of us, fortunately, are embarked upon. They are the very elderly poor--those who have had no chance of building up a second pension. Clearly, important policy recommendations have been made on how everyone can receive those second pensions. Of course we know what to do to ensure that the poorest pensioners can be part of the train journey again. We

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could credit them into the state earnings- related pension scheme, so that the entitlement would not live beyond them but die with them, and their standard of living would increase appreciably

We know that single-parent families are one of the biggest groups in that fourth-class carriage. All hon. Members must be worried about the rate of the increase in the number of children who are cared for by only one parent. We all have an interest in their welfare. As taxpayers, perhaps paying up to 5p in the pound for non-payment of maintenance, we have an interest in the Child Support Agency working a little more effectively than it does.

Given that large numbers of those single mums, for they are single mums generally speaking, will get out of the fourth-class carriage by marrying-- perhaps the Secretary of State for Social Security should spend more time on how to make that easier for them--we need not be too concerned about them in the long run, although we are immediately concerned about them. We must be concerned about the males in that fourth-class carriage who are semi-skilled and unskilled. If things go on as at present, they will never work again in their lifetime. In Birkenhead and in Liverpool about 20 years ago, 26 million tonnes of goods came in and out of the port on both sides of the river, and 20,000 dockers were employed. This year, an additional tonnage has gone in and out of the port, and only 400 dockers have been employed. Semi-skilled and unskilled jobs for male workers have been wiped out. What are we going to do about the disfranchised male? That is one of the issues that we must face.

Clearly, as a group, those males are far less able than women to adjust, and to box and cox in the labour market. Males have all sorts of hang-ups about our roles and about what we deserve. Clearly, however, other factors are at work, which prevent jobs from reaching that group. We are concerned about that.

I applaud the Joseph Rowntree Foundation study for considering how the Government have decoupled that fourth carriage of Great Britain Ltd. so that it no longer heads in the same direction as others, but I disagree about where we go from here. I am pleased beyond belief that the Rowntree study talked about self-interest, which is an important part of human motivation. The biggest three motivations are self-interest, self- improvement and altruism. The weakness of the left has been to believe that we can build a social or even an economic policy on altruism. We cannot.

Let us consider what the Rowntree report thinks of as self-interest. It states that middle England--the people in the first three carriages--will give up some of their privileges or the speed of their train for fear that they will be set on by bandits. I have news for Rowntree: if that is so, in the next 10 years middle-income England will be voting for and insisting on corporal punishment to deal with disorder rather than voting for tax increases. Any welfare reform has to be built on the basis that there is something in it for those in the first three carriages. That brings me back to the national insurance fund, a subject that has already been mentioned. Clearly, we have to rethink the scheme and make clearer the link between people's benefits and earnings. If there is to be a redistribution--the altruistic side that I

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believe exists--it has to be above board. We must not think that we can kid people that we can fiddle their contributions and pay them to someone else. There has to be a positive decision by the taxpayer via the Exchequer. The reform of the welfare system is, I hope, the task in hand. We need a new system in place soon if there is to be a clear alternative to what is being offered by the Treasury Bench and its supporters.

We have had a clear model of how the Treasury will deal with the inhabitants of the fourth-class carriage who are no longer participating in the journey being undertaken by the rest of us. The Secretary of State devises raiding parties to catch a few and drag them to join the rest of us aboard the main train. He devises back-to-work benefits and the additional bonus, in cases where the Child Support Agency is working and collecting the maintenance, when the mother goes back to work.

All these measures are to be applauded, and every experiment must be examined with interest and extended if it is a success, but I do not believe that we shall get back to the policy of incorporating people into the mainstream of society if we are concerned only with devising even more effective raiding parties. We need a strategy to get the fourth-class carriage back on to the main line to be a part of the journey that the rest of us are, fortunately, making. I end as I began. I do not dispute the figures that show an increase in incomes since 1979. I rejoice in them, and I am pleased that some have been able to benefit, but the flip side of that is a very--

Madam Deputy Speaker (Dame Janet Fookes): Order. I am sorry, but the hon. Gentleman has had his 10 minutes.

8.22 pm

Mr. Michael Trend (Windsor and Maidenhead): I am sorry to have missed parts of the debate. I was present for the opening exchanges but then had to attend Standing Committee A.

It is a pleasure to follow the hon. Member for Birkenhead (Mr. Field), who made a characteristically thoughtful speech. However, I cannot agree that the fourth carriage has become decoupled. That is certainly not the case according to the evidence of the Rowntree report to which I shall refer in a moment. I was, however, intrigued by the hon. Gentleman's idea that the Secretary of State should "cure" single mums by what seemed to be an advocation of serial bigamy. The idea that he should somehow marry them all off was rather nice.

I heard the speech made by the hon. Member for Glasgow, Garscadden, (Mr. Dewar), but I was rather disappointed. Like other hon. Members, I had a high opinion of the Joseph Rowntree Foundation. I once had the honour of working for some time at Toynbee hall in London's east end. I can confirm that the foundation's work in many spheres is widely respected. On this occasion, however, I regret that the foundation has been drawn into the smokescreen beneath which the Labour party is hiding its reluctance to make policy.

The Rowntree report is in many ways a very old-fashioned piece of work. It covers ground which we have been over many times but does not appear to notice that the debate has taken new directions in recent years.

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