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Mr. Ronnie Fearn (Southport): Does my hon. Friend agree that a new category of poor pensioners consists of widows who thought that they had been left well-off by their husbands? The dividends they receive from invested income has now dwindled and, because of that, the consequences of any structural damage to their houses, such as a leaking roof, can be that they have no income at all. Does my hon. Friend agree that that category of pensioner has never been adequately addressed by the Government?

Mr. Burstow: My hon. Friend makes a fair point. Some people who are described as asset-rich but who live on low incomes are caught by the way in which the current income support system operates. I hope that the Government will consider how to address that problem; if they do not, they will condemn many of our constituents to lives of poverty and increasing desperation as their properties deteriorate around them.

From my experience of attending meetings of the seniors forum and other gatherings of older people in my constituency, I know that an issue that often provokes anger, outrage and a sense of frustration is the age addition at the age of 80--the extra 25p which appears in one's pension book on one's 80th birthday. It is not even sufficient to pay for a first-class stamp to stick on the letter that expresses one's opinion, whether positive or negative, and it has remained unchanged since 1971.

Evidence collected by my hon. Friend the Member for Northavon from written parliamentary answers makes it plain that extra financial help would be best targeted on older pensioners. The poorest pensioners are older pensioners, and women pensioners are even poorer than men. According to the most recent figures, for 1996-97, pensioner couples where the man was over 75 had a net income of £226 per week, compared with £259 net income for those under 75; and while a single male pensioner had an average net income of £141, a female pensioner had to live on £126. That is why I strongly support the development of a pensions policy that targets more help on older pensioners. Liberal Democrat policies to increase the state pension for the over-75s by £3 a week and for the over-80s by £5 a week represent a good step in the right direction. There is no danger of low take-up and no stigma, and administration costs would be low, but the measure would be effective and get help to far more people than the so-called minimum income guarantee.

When preparing for today's debate, I came across a very interesting speech made at a conference last September by Chris Daykin, the UK Government Actuary. He put the issues very clearly, saying:

"In the UK, where the level of flat-rate social security provision is relatively low, public opinion seems to favour raising the basic pension to a more realistic level, rather than relying on means-tested top-ups."

He must have been reading the findings of the Government's focus group work, because the research demonstrates strong support across all age groups for a decent pension. The research found that working participants in the focus group were willing to pay more national insurance to pay for an increase in the basic state pension of at least £10 per week, and even as much as £30 per week, for a single pensioner.

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The final issue I want to raise during this debate is that of long-term care. I realise that that is not one of the Minister's direct responsibilities, but I hope that he will be able to say a few words on the subject.

Rev. Martin Smyth (Belfast, South): Before the hon. Gentleman goes on to the subject of long-term care, I should like to compliment him on his excellent research and tell him that I support the thrust of his argument. One constituent of mine has only a 40 per cent. pension, because he did a great deal of voluntary work overseas. He put some money aside in savings and does not qualify for income support, although he does receive housing benefit. However, his income has now fallen by 20 per cent. Are there not many people like my constituent in the country? Should not the Government reconsider the way in which they deal with pensioners who tried to provide for their retirement, but who are now penalised for having done so?

Mr. Burstow: The hon. Gentleman's constituent could represent many others who, for one reason or another, find themselves without a full basic state pension, despite the important contribution that they have made to society. I am sure that my hon. Friend the Member for Northavon has tabled written questions on that subject and obtained detailed statistics that I do not have at my fingertips this morning. I hope that the Minister will take account of the point raised by the hon. Member for Belfast, South (Rev. Martin Smyth) and ensure that it is considered during the consultation on the Green Paper.

Returning to the issue of long-term care, this week alone about 1,400 older people will be forced to sell their home to pay for their care, and the emotions that that provokes range from bewilderment to anger. There is a real sense of betrayal--those people have paid in throughout their lives, but when they need the state to support them, it is not there. The royal commission reported at the end of February and its report concludes that there is no demographic time bomb and that the costs of care are affordable. The royal commission also supported an approach to paying for long-term care that is based on some kind of risk pooling. The current situation whereby people must rely on income or savings is neither efficient nor fair owing to the risk and the sums involved. Finally, the royal commission believes that most efficient way of pooling risk is through general taxation, based on need rather than wealth.

The Government have said that they will debate the royal commission's recommendations, and I hope that the House will soon have an opportunity to consider the matter in greater depth. Time is pressing, and uncertainty about the future funding of long-term care must be ended quickly. Decisions need to be made. The absence of a clear timetable from the Government has fuelled widespread cynicism about Ministers' intentions in this area. How soon does the Minister expect action from the Government?

I am grateful for this opportunity to air several issues affecting my pensioner constituents. I hope that the Minister will say something about the 10p rate, the income support take-up pilots, the derisory 25p extra per week for the over-80s and the urgent need for a clear timetable for decisions on long-term care. I shall finish where I started by quoting from the letter of my constituent:

"We are not moaning money grabbing people that drive a large car, or travel the world two or three times a year, nor can we afford private health care. All we want is to be able to live the rest of our

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lives in some degree of comfort, not living off the state, not living off my children, and if we do need hospital treatment it will be available."

That is a reasonable request and I hope that the Government will meet it.

9.51 am

Mr. Bill O'Brien (Normanton): The House has listened carefully to the hon. Member for Sutton and Cheam (Mr. Burstow), whom I congratulate on introducing this subject this morning. However, the hon. Gentleman had difficulty in congratulating the Government on their achievements in assisting pensioners over the past two years. I think we should congratulate the Government on their strenuous efforts to help old and disabled people in receipt of pensions.

The Government's first act was to cut value added tax on domestic fuel bills. While that cut applied across the board, it was particularly important for peopleon pensions. The Government have also increased substantially the winter fuel allowance. Under the Tories, old people had to suffer seven days of temperatures below freezing before they qualified for £7 or £8 to assist with their fuel bills. A winter fuel payment of £100 is now paid to pensioners.

The Government have abolished charging for pensioner eye tests. The Liberals used to complain loudly about such charges, but the hon. Gentleman did not mention that reform in his speech. The Government have offered help to the poorest pensioners in the Budget by reinstating the link with earnings. That is a step in the right direction, and I know that the Government will continue down that road.

Mr. David Rendel (Newbury): The hon. Gentleman has mentioned the Government's assistance to the poorest pensioners through continuation of the link with earnings. He is presumably referring to the link with earnings through the minimum income guarantee. Is he aware--as my hon. Friend the Member for Sutton and Cheam (Mr. Burstow) made clear a moment ago--that the poorest pensioners do not receive income support, even though they are eligible for it? Therefore, they will not be helped by that link with earnings.

Mr. O'Brien: The Liberals will clearly not accept any move to strengthen benefits and to help eradicate pensioner poverty. The Government have introduced several measures that benefit the poorest pensioners. For example, the Government decided recently to compensate former mine workers whose health was broken by the conditions in which they worked underground. Some 100,000 retired mine workers--many of them my constituents--will receive the largest compensation payment ever made in this country. The Government are keeping their promises, and these issues are worth mentioning in this debate.

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