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Mr. Darling: I have been listening to this nonsense for some time. The hon. Gentleman will be aware that the Government's proposals for the reform of the state second pension, which is a contributory pension, will mean that more people will get an increased amount. We are doubling the amount of money that people on £9,000 or below will get from that contributory benefit. We have a mixed social security system involving means-tested and contributory benefits. I have given an example of a contributory benefit that we are increasing. If the hon. Gentleman's argument was right, contributory benefits could never be changed or improved. When he sits down and thinks about that he must realise that it is nonsense.
Mr. Webb: I am sure that you will not allow me to stray too far in talking about the state second pension, Mr. Deputy Speaker, but I should like to address that point. For the next 20 years, contributory pension
expenditure on the state second pension plus the state earnings-related pension will be lower because of the Government's policies. In 2050 or after another total eclipse they will be spending more, but, within 20 years, there will probably be no state second pension because some other Government will have ripped up the unfunded promise. It is the coming years that are relevant to people currently in their 50s and 60s. By 2050, plenty of us here, let alone today's pensioners, will be dead. In the next 20 years, the Government will be spending less on the contributory retirement pension than would have been the case without their reforms.
The Secretary of State mentioned benefits for carers under the state second pension. It will be 50 years before people can get a full state second pension. That is how long the reform will take, yet the Secretary of State justifies cuts to invalids over the coming five to 10 years on a promise 20 or 30 years down the line.
Mr. Webb:
Does the Secretary of State have the arguments to back that up? Heckling is easy, but has he brought an argument to the House?
Many Labour Members have difficult points to make--no one enjoys voting against their own party--and they deserve to be heard. The Secretary of State can easily dismiss the Tories because of their record, and he can choose to dismiss us. However, he has said that he will listen to his own Back Benchers who, I believe, are deeply dissatisfied with the direction of the Government. Means testing is not the future, it is the past. It is time that the Secretary of State thought again.
Kali Mountford (Colne Valley):
We have heard some outright nonsense this afternoon, and I cannot resist addressing much of it. The welfare state was created 50 years ago, and times have changed. We are asked why it is right to look at this matter--it is right because the conditions are different. [Interruption.] The hon. Member for Havant (Mr. Willetts) says--from a sedentary position--that the system was introduced in 1995. He is trying to mislead the House. We are looking at the whole benefits system, and the Tory reforms merely tinkered and renamed the system. We must look back to the system in 1991 and, prior to that, at sickness benefit, which was the precursor to the proposals that we are debating.
Sickness benefit is an income-replacement benefit. We are debating today--in a changed world--what we mean by that, and how we focus benefits. I support the proposals because I think that they are right. I do not do so because I wish to eke out some meagre resources, but because the proposals make sense. They make sense in terms of the national insurance contributory principle and in terms of how we use that principle now and in the future.
We must look at the link between the contribution and sickness benefit. We talk about national insurance contributions as if they pay only for that benefit, but we pay national insurance contributions for a range of things, and we get a great deal out of it. Some people get more out of it than others, but that is part of the redistribution within the system.
People talk as if we all had an individual fund. One of the problems is that there never was a fund. There is no state pension fund from which we get our pension. We
have no fund for our hospital care. We have no personal fund if we become sick, disabled or unemployed. We pay today for today's recipients. To talk about a fund that does not exist is misleading, and to suggest that no one gets anything from his national insurance contributions is not true. We get a great deal.
On incapacity benefit, we must look at the poorest recipients, who are on income support. The debate has dismissed people on income support as if they were invisible. That is nonsense--they do exist. For the purposes of accounting we cannot simply act as though they do not exist, when clearly they do.
We must look at how we focus resources. Do we focus them on the most disabled, or the worst off? The Government's proposals contain an element of both. The most severely disabled are exempt from the measures and are protected. Consideration has been given to degenerative conditions, so that people need not have concerns about such a condition while they are in work. As their condition worsens and they can work less, credits will be made available. The national insurance system is being upheld yet again.
Mr. Pickles:
Will the hon. Lady give way?
Kali Mountford:
I cannot resist the hon. Gentleman.
Mr. Pickles:
I have to tell the hon. Lady that she is not alone in that thought. [Laughter.] I am enjoying her speech, in which she has said that the three-year period is perfect. In Committee, she gave the same speech, but said that a two year period was perfect. Why is two years now wrong and three years better?
Kali Mountford:
The hon. Gentleman will recall that I did not use the word "perfect"--I said that it was reasonable. The proposal is all the more reasonable now because we are witnessing--the hon. Gentleman may not be used to this--a Government who have listened and responded. I will try to resist him from now on.
Another problem with the debate has been the constant reference to the all work test. Some colleagues have not been watching what has gone on. I recall that people have been dissatisfied with the all work test, which was anathema to many--including those who have been lobbying for disabled people.
The all work test took no account of people's abilities, and that must be wrong. We have to change the system to one that recognises that people with disabilities also have abilities. In the past, we have had a national insurance contribution system from which benefits have developed. We must look to the future and at how we want society to be. We do not want a society that says that if someone becomes ill or disabled, we will simply write them off. Opposition Members may have heard me say that in Committee, but I say it because I believe it.
It cannot be right to have a system that discourages people from developing their full potential. We must look at this measure in the context of all the other measures that relate to it. People are applauding the new disability tax credit--it is a method by which we can support people who are getting back to work. If anyone thinks that a life on benefits--be it incapacity benefit at its slightly higher rate than jobseeker's allowance--is a joy for anybody, they have not lived on benefits.
Dr. Lynne Jones:
Is living on £160 a week any great joy?
Kali Mountford:
My hon. Friend is not considering the full implications of the proposals. We must look at the disability income guarantee and at how we get people back to work. People working for only 16 hours a week will now be able to get the disability tax credit.
Does someone on income support deserve less consideration than someone with an occupational pension? My answer is no. It has been said that people have made provision through their occupational pension for such circumstances. Lots of us have done so--not because we think that we will retire at 50, 55 or 60, but because we want to make provision for our old age.
People are pretending about what has gone on in the workplace, where there have been actions that we cannot condone. Employers have been looking at incapacity benefit and others as a top-up to get people out of the system altogether.
Mr. Brazier:
If the hon. Lady's allegation is true--I believe it has some truth--surely the answer is to tighten the medical criteria, as we suggested in Committee, rather than to take it out on perfectly legitimate disabled people who have saved or earned a little more than the limits proposed by the Government.
Kali Mountford:
The hon. Gentleman obviously was not listening to my arguments about the all work test. We have to consider how we can accommodate people who have medical conditions or disabilities and allow them to move into work and off benefits. The Conservative proposals could even trap them into benefit for much longer than any of us would have envisaged.
I do not want to make allegations about people cheating the system. People with genuine problems would be better off staying in their jobs with support rather than being told that we will find a way of getting them out because it would be more convenient. The fact that they have a genuine condition does not mean that it is right for them to rely solely on benefits. We should try to help people to stay in work if they are employed and to find work if they are not.
No one would try to pretend, however, that that is the solution for everyone. We will never have a perfect economy with 100 per cent. employment, but we should aim for it. People currently claiming incapacity benefit have a right to be part of the new economy and the growth that we expect to arise from other marvellous measures introduced by the Government. I could not resist saying that.
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