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New Deal (Lone Parents)
4. Mr. Graham Brady (Altrincham and Sale, West): If he will make a statement on the progress of the new deal for lone parents. [73041]
The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): The new deal for lone parents is providing active support to help lone parents to move into work. As of 29 January, more than 163,000 initial letters have been issued; more than 39,000 lone parents have attended interviews and, of those, 32,000 have agreed to participate in the programme; and more than 6,000 jobs have been obtained by lone parents.
Mr. Brady: I thank the Minister for that interesting response. On 29 April last year, when the right hon. Member for Camberwell and Peckham (Ms Harman) appeared before the Select Committee on Education and Employment, some 6 per cent. of those who received letters were finding work. The right hon. Lady told me on that occasion that the number was increasing exponentially. I understand from the latest figures that 3.8 per cent. of those receiving letters are finding work. Perhaps the right hon. Lady meant that the number was decreasing exponentially. In any case, do not the figures demonstrate that the scheme is a £200 million failure that needs urgent review?
Angela Eagle: No. The hon. Gentleman has been doing rather odd mathematics. Why divide the number of letters issued by the number of jobs obtained? That seems a meaningless calculation. The fact is that the Government are doing something to help lone parents to get back into work. The previous Government did nothing but scapegoat them.
Ms Diane Abbott (Hackney, North and Stoke Newington): Does the Minister share the concern of a number of organisations that represent single parents about the proposal in the Welfare Reform and Pensions Bill that single parents should be subjected to a series of compulsory interviews? Does she agree that it is no business of a Labour Government to imply or suggest that the only way for mothers with children under five to improve their lot is to go out to work?
Angela Eagle: I do not share that concern, because I think that it is based on a misunderstanding of the single
work focus gateway proposals. No mother of children under five would be made to attend an interview unless she were applying for extra benefits. The idea of the interview is to assist her in getting into work or becoming more employable for when she decides that it is right for her to take up work. There will be no compulsion to act, or to look for a job, as a result of the interview. We hope that the interviews will help the 1.8 million children who are being raised on income support in poverty, and will assist the 1.6 million lone parents to improve their lot, enabling them to look after their children and move off benefit into work, so that they can give their children much better chances in life.
Mr. Eric Pickles (Brentwood and Ongar): If the calculation is as meaningless as the Minister suggests, she should understand that it is the Government's calculation. What is meaningless is the amount of wasted money that has gone on the scheme--£200 million, which is a cost of £15,000 a job. The simple truth is that those who wanted to get a job have got one, which is why the figure has gone down from 7 to 3.8 per cent. Does she understand that the only reason why this flagship policy has not sunk without trace is that there has never been sufficient water under it to allow it to float?
Angela Eagle: One of the largest causes of poverty among our children--something that surely concerns the hon. Gentleman--is the fact that 60 per cent. of lone parent households are workless. We are trying to tackle the problem of workless households by giving lone parents the chance to get back into work so that they can provide for their children at much higher levels of income than income support could ever give them. That is what we are doing; the Tory record is one of total neglect and scapegoating.
We are trying to do something to get lone parents back into work. The new deal for lone parents will be properly assessed in the autumn and there will be an independent assessment of how it is working. We shall look at how it is doing then. I do not like taking lectures from a member of a party that, when it was in office, did absolutely nothing but condemn lone parents to a lifetime on benefit.
Madam Speaker:
I call Mr. Brazier.
Mr. Julian Brazier (Canterbury):
Thank you, Madam Speaker. The answer to the--I am sorry, Question 5.
5. Mr. Julian Brazier (Canterbury):
If he will make a statement on progress towards introduction of the single gateway to benefit. [73042]
The Parliamentary Under-Secretary of State for Social Security (Angela Eagle):
A seamless move from Question 4 to Question 5. Our plans for the introduction of the single work-focused gateway are on course.
Mr. Brazier:
The answer to an earlier question established that the voluntary principle is doing nothing to the new deal. What is the point in introducing compulsory gateway interviews for single parents and other categories of people who are not compulsorily required to take a job? Is the whole mass of exemptions under clause 47
Angela Eagle:
I wish that Conservative Members would not dismiss as nothing the 39,000 lone parents who have had an interview so far and nearly 30,000 people who have joined the new deal for lone parents, let alone the 6,262 lone parents who are in work as a result of the new deal. The idea of the single work-focused gateway is to give individual, tailored help to people who may have been away from the labour market for a long time and to give them a strategic direction so that they can plan, when their children are old enough, to get back into the labour market and support themselves and their children.
Mr. Andrew Dismore (Hendon):
On Friday, I visited a project in Burnt Oak in my constituency, which is run by Hendon college and involves working with the older age group of unemployed people. One of the big complaints that came through to me from the clients and the staff at the project was the lack of a gateway for the older age group. Will my hon. Friend the Minister take that on board and make sure that we do the best that we possibly can for people in the older age group--they face all sorts of barriers, including age discrimination--and start to broaden the gateway?
Angela Eagle:
My hon. Friend correctly identifies the fact that people appreciate having a personal adviser and individualised help in a confusing system of benefits and a difficult and fast-changing labour market. That is something that we have learned from the new deal, and we are anxious to extend it to the benefits system, where it will be widely welcomed.
Mr. Iain Duncan Smith (Chingford and Woodford Green):
Is not the reality that the Government are in a complete mess over their programme--[Hon. Members: "Oh!"] They do not like it, but we have a gateway programme and the Bill is going through Parliament, although the Government still do not understand or admit how much that will cost. They set no targets for the increase in the number of jobs that they want to achieve. There are 1 million lone parents on income support, but there is no comment about how many of them the Government expect to get into work. We have heard about the £200 million cost of the new deal for lone parents, which is wasted, and that 3.8 per cent. of lone parents get into work, although nearly one fifth of them fall away from work after six months. Must not the Government now accept that they have no joined-up thinking in that regard? They have two programmes aimed at two groups, and they are failing. It is the Government who are doing nothing: they raise expectations, and then dash them by failing.
Angela Eagle:
The single work-focused gateway is a pilot scheme. In fact, there will be 12 pilot schemes, to enable us to learn how best--
Mr. Eric Pickles (Brentwood and Ongar):
Make it up as you go along.
Angela Eagle:
We are not making it up as we go along; we are ensuring that the changes that we are to make will work, and can be properly costed and planned. That is responsible government.
The hon. Gentleman needs to understand this. We believe that benefit claimants, as well as those who have been unemployed and are taking advantage of the new deal, will find personal adviser interviews and individualised assistance beneficial. As I have said, the single work-focused gateway involves pilot schemes, which will take place in 12 different areas over the next two or three years, and we have set aside £80 million for the purpose. We will evaluate and assess the pilot schemes, and will then be able to tell the House how we can transform our benefit system into an active system that will help individuals, rather than just doling out money and leaving them floundering.
6. Mr. Bill Rammell (Harlow):
If he will make a statement on the review of the savings allowance in relation to the minimum pension guarantee. [73043]
11. Sir Sydney Chapman (Chipping Barnet):
What assessment he has made of the effect of the introduction of a minimum pension guarantee on low earners'savings. [73048]
The Secretary of State for Social Security (Mr. Alistair Darling):
We made clear in the pensions Green Paper that we want to look at options for changing the rules on the treatment of voluntary saving better to reward those who have saved for their retirement.
Mr. Rammell:
I thank my right hon. Friend for his reply. I fully support the Government's policy of aiming support at the poorest pensioners in the initial stages of the current Parliament, and decry the selective amnesia of the Opposition. A huge expansion of means-tested benefits took place when they were in power; now, they have suddenly discovered that they have problems with that.
Does my right hon. Friend agree that there is a problem for pensioners with relatively few savings who feel that they have played by the rules, but who are now finding that those relatively small sums disbar them from additional state support? May I strongly urge the Government to take that factor into account in the review?
Mr. Darling:
My hon. Friend has made two good points. First, I think that we all take with a pinch of salt some of what is now being said by the Conservative party, and what will be said in the "kitchen table" talks that it is introducing. Secondly, I have made it clear on a number of occasions that we need to ensure that someone who has saved, and has a modest amount of capital or income, will not be penalised on that account. As we made clear in the pensions Green Paper, we are determined to act.
Sir Sydney Chapman:
Given the Secretary of State's acceptance that the introduction of a minimum pension guarantee will lead to a distinct disincentive for those earning below the average to save, and given that it will lead to a massive increase in means-testing and more dependency on the state, will the right hon. Gentleman
Mr. Darling:
I think that the hon. Gentleman was a Whip during much of the last Government, and he did nothing about the problems about which he now complains.
We recognise that there is a problem for pensioners with income and capital, and we are therefore determined to do something about it. In regard to the minimum income guarantee, we--unlike the Conservative party--recognise that there are many pensioners who are poor, and who need immediate help. The guarantee means that we are giving to the poorest pensioners real help, which many of them greatly appreciate and which, sadly, many of them greatly need.
Mr. Steve Webb (Northavon):
I restate my support for the Government's decision to link the minimum income guarantee to earnings. However, does the Secretary of State accept that an anomaly is being created? The overall aim of the policy is to ensure that people reach retirement age with an income above the minimum income guarantee level, but, in written answers to me, he has suggested that they will be below that level within five years of retirement. As the guarantee rises in line with earnings, and all other pension incomes rise in line with prices, people could slip back down later in their retirement. Is the right hon. Gentleman concerned about that, and does he plan to do something about it?
Mr. Darling:
I appreciate the fact that the hon. Gentleman--I assume that he speaks for the whole Liberal Democrat party on the issue--[Interruption.] Obviously not. I appreciate what he said. Most sensible commentators, and he is clearly one, recognise the value of linking the minimum income guarantee to earnings.
On the hon. Gentleman's substantive point, our object is to ensure that, during their lifetime, people save as much as they possibly can, so that they do not have to rely on income-related benefit. With people living longer--sometimes for 20 or 30 years after retirement--that means that there has to be substantial saving. One of the things that we are doing that will help people who can save but do not, is to ensure that they receive an annual pension statement, which will concentrate some people's minds in a way that has not happened.
Mr. Malcolm Wicks (Croydon, North):
Only this morning, before coming to the House, I met a group of pensioners in Croydon. The main issue that they raised was the perceived unfairness of the position of those people who, for either income or capital reasons, were just above the means-tested income support level.
One elderly woman, a widow, said that she had put aside savings so that she could do repairs to her home, if those were necessary. Because of those savings, she was debarred from income support. I welcome what my right hon. Friend has said about the savings trap and our need to spring it. It cannot be right that those who are the most responsible and thrifty among the elderly population are penalised, rather than supported.
Mr. Darling:
I appreciate my hon. Friend's point. Without wishing to labour the point, let me say that the
Mr. Iain Duncan Smith (Chingford and Woodford Green):
Is it not a fact that the Secretary of State has put pensioners in an expensive mess? The very fact that he has to look at the savings trap shows that the Government blundered into the whole business of the minimum income guarantee without thinking through the effects of what they were about to do. It will lead to increasing dependency.
Let the Secretary of State ask himself what the Government have done for pensioners. When they first came in, they taxed £5 billion a year off pension holders, which means that pensioners will be up to 15 per cent. worse off on their incomes after retirement. Not only is the budget rising by £37 billion a year, but the Government's response to that is to increase dependency through the minimum income guarantee, increase the cost further and so increase the overall cost of welfare.
The Prime Minister promised to cut the cost and the Secretary of State is raising it. We have heard of dumbing down, but surely that is dumb government.
Mr. Darling:
Discussion over the breakfast table in the household must be absolutely fascinating.
The Conservatives have to face up to two points. First, the income and capital rules have been there for some considerable time. In fact, they were there during the whole time that the Conservatives were in office, and they did nothing about them.
Secondly, if we had not changed the way in which pension provision is made for the future, one person in three who is now working would rely on income-related benefits--in other words, the means test that the hon. Gentleman complains about. What we have done is to ensure that, where people work throughout their life, they are rewarded by not having to rely on income-related benefits when they retire.
The minimum income guarantee was introduced to tackle a real problem: there are far too many poor pensioners. [Interruption.] One would think that the Conservative party--I know that Conservative Members have been told this in their new presentation--had arrived on the planet only last week. They were not only on the planet; they were in government for 18 years, during which time they did nothing for poorer pensioners.
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