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Mr. Lilley: We can make greater progress than any previous Government because of our benefit reviews, which enable us to identify, measure and investigate the different kinds of fraud. Those reviews are taking place benefit by benefit. Provisional results from the review of housing benefit show a substantial amount of fraud there. That information enables us to carry forward anti-fraud measures against housing benefit with local authorities. I imagine that the other benefits are likely to show a lower level of fraud. The answer to the hon. Gentleman's final question is that there is greater security with this Government, and me in charge of the anti-fraud campaign, than there would be with anyone else, with the possible exception of the hon. Gentleman.

Mr. John Townend (Bridlington): Will my right hon. Friend accept my congratulations on all the savings that he has made? I am slightly mystified, however, in view of the great number of savings that he has outlined to the House, that page 126 of the Red Book shows that social security spending has gone up, compared with plans for 1996-97, by £1,040 million and that, for 1997-98, it is proposed that the increase from previous plans be a further £550 million.

Mr. Lilley: I am grateful to my hon. Friend. I think that I can help him with the figures. They refer to the control total, which forms only part of the actual total and excludes all cyclical benefits in my Department. Offsetting savings have been made in some areas of cyclical benefits, which are not included in the control total. We excluded cyclical benefits because we thought that it was right to let the cyclical effect of increased spending occur during the recession and be fully financed by extra taxation. As I said this morning, only two things drive up taxes--recession and a Labour Government. We are coming out of recession; let us ensure that we do not have a Labour Government. We can then be certain of sustained lower taxes.

Mr. Terry Rooney (Bradford, North): The Secretary of State will be aware that one of the greatest areas of fraud is among corrupt employers who work in the black economy. Why has he cut Contributions Agency field inspectors by 60 per cent.?

Mr. Lilley: I said in my statement, quite contrary to what the hon. Gentleman says, that with the integration of the Employment Service fraud officers and my Benefits Agency staff, there will be a special effort to crack down on collusion between employers and employees. I am glad to have the hon. Gentleman's support for that.

Mr. Peter Luff (Worcester): In my constituency and around the country the elderly and those approaching retirement will welcome the measures that my right hon. Friend has announced for long-term care and those that my right hon. and learned Friend the Chancellor

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announced yesterday about tax on savings. Will my right hon. Friend continue with research to find ways to reward rather than penalise those who have been prudent enough to prepare for their old age?

Mr. Lilley: I am grateful to my hon. Friend for his welcome. He is right to say that, going beyond the measures that I have announced and including those announced by my right hon. and learned Friend the Chancellor, this is a Budget for everybody but specifically for the prudent and the elderly. We think that those who are prudent enough to save for retirement should be encouraged to do that, hence the lower tax on savings, measures to promote investment for long-term care and the recognition of the comparative harshness of the previous capital rules.

Mr. Dennis Skinner (Bolsover): Does the Secretary of State recall that in the past few weeks, the nation has been aghast at the stories, emanating from around Gloucester and elsewhere, of young women in particular roaming the streets and being picked up by Rose and Fred West? By proposing to take away some of the housing benefit from under-25s, he will create a situation in which thousands of young people will be roaming the streets. Any decent Government would withdraw that proposal. If he wants to do something about high rents, he should tackle the landlords--his friends.

Mr. Lilley: Even by the hon. Member's standards, that is a distasteful attempt to exploit a ghastly tragedy for party political ends. We propose to continue housing benefit for the under-25s but to restrict it to the level that is payable for shared accommodation. That is only right and proper. A number of the measures that we have announced will prevent abuse by both landlords and tenants.

Mr. Bernard Jenkin (Colchester, North): Is it not disturbing that total spending on social security is still rising despite all my right hon. Friend's efforts to curb it?

Does not that demonstrate that, unless we continue to reform social security and tackle fraud, the burden will continue to rise and threaten the country's prosperity?

Mr. Lilley: I agree that further work needs to be done. I spelt out that there would be a step-by-step, sector-by-sector review of social security. That is the way in which we have approached it. None the less, it is worth noting that the average growth in real terms of social security spending over its first 50 years was 5 per cent. a year, while over the next three years it is expected to be a little over 1 per cent. That is a major change, and this must be one of the very few countries in the developed world that can expect social security to take a declining proportion of national income in the years to come, thereby reducing taxes and the burdens on creating jobs.

Ms Angela Eagle (Wallasey): Given that the Government have admitted that lone parents face extra costs, can the Secretary of State explain why the children of lone parents should be made to suffer because of the marital status of their parents, which after all is not their fault?

Mr. Lilley: Lone parents receive extra money relative to couples in a number of ways and not just through lone-parent premium and lone-parent benefit. The lone parent receives £10 a week more in her or his personal

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allowance than when she or he was part of a couple. That reflects the greater cost of living alone. There are a number of other changes, the most important of which is the introduction of family credit. It is heavily weighted to the benefit of lone parents and has significantly increased the chances of lone parents returning to work. We must build on that.

Mr. Nick Hawkins (Blackpool, South): The measures announced by my right hon. Friend will certainly be welcome in many seaside resort constituencies, not least because of the help that he has announced for those who are in long-term care, his raising of capital limits and his continuing support for the most vulnerable pensioners. Is he surprised to know that, contrary to what the hon. Member for Bolsover (Mr. Skinner) said, Labour councillors in many seaside resorts own and run houses in multiple occupation and benefit as unscrupulous landlords? That is the record of Labour in power.

Mr. Lilley: My hon. Friend speaks with great knowledge of this matter and I am sure that his remarks will bite home among Opposition Members. I am grateful to him for his welcome, and I know that the measures that I have announced will be well received not just in Blackpool but in many other seaside and inland resorts.

Mr. Alan Howarth (Stratford-on-Avon): What assessment has the Secretary of State made of the cost to public expenditure of his decision to cut the value of lone-parent benefit, thus making it harder for lone parents to be in work? What assessment has he made of the effect of reducing the lone-parent premium which, through impoverishing households, means that more children are likely to be taken into care? On what evidence does he justify his decision to erode lone-parent premium which was introduced by his predecessor in 1988 in recognition of the additional costs and pressures faced by lone parents? Why does the Conservative party insist on stigmatising lone parents?

Mr. Lilley: That is nonsense, as my hon. Friend--well, he is a friend, though not in the technical sense that he was before--used to know. The hon. Gentleman is talking absolute nonsense. We are moving lone-parent premium and one-parent benefit in parallel and there is thus no change in work incentives. We are simultaneously improving rewards for work through changes to family credit, making it available to part-time workers, increasing its value for full-time workers and covering more generously the cost of child care. He should recognise and welcome those changes. When he has considered them, perhaps he will review which side of the House he should sit on.

Dr. Robert Spink (Castle Point): In welcoming my right hon. Friend's reduction, albeit marginal, in non-wage labour costs, may I ask him to resist Opposition policies that would increase not just non-wage labour costs through the adoption of the social chapter but direct labour costs because of the minimum wage? That would happen at all salary levels because the policies advocated by those on the Opposition Benches would put people out of work.

Mr. Lilley: Far more important than anything that we can do directly to improve the benefits system are measures that increase the number and availability of jobs for those who would otherwise depend on the benefits

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system. We have been more successful than our counterparts in Europe in getting unemployment down and getting people into work. We have about 68 per cent. of people of working age in work. On the continent the average is 60 per cent. If we had the same average as that on the continent, which the policies of the Opposition might well achieve, there would be 3 million fewer people in work in this country. That is a measure of how important it is to stay out of the social chapter and continue to reduce taxes and the costs of creating jobs.

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