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Mr. Darling: Even for the Liberals, that takes the biscuit. Let me make one or two things clear to the hon. Gentleman. He asked about the uprating of benefits. No benefits will go up by less than the Rossi index or the RPI. He may be interested to know--I am grateful to him for allowing me the opportunity to point this out--that the amount of money paid under the minimum income guarantee goes up by considerably more than an inflationary increase, and the child benefits and child premiums go up considerably more than they would have done under inflation, both of which measures I would have hoped the Liberals would have supported.
The hon. Gentleman mentioned pensions. I make no bones about the fact that the Government's strategy is primarily geared to helping those pensioners who need help most--those who lost out over the past 20 years. An across-the-board increase, whether prices or earnings related, would not help the pensioners on the lowest incomes because they would lose it pound for pound. That is why we have introduced the minimum income guarantee, the winter fuel payment and free television licences for the poorer pensioners aged over 75, most of whom live in some of the poorest households. Had pensions been earnings linked this year, they would have gone up by slightly more than £3 a week, but because of what the Government have done most pensioners will receive slightly more than £4 a week. They have done better as a result of the policies that we have put in place. His proposals, which he published about two months ago, involved abolishing the state earnings-related pension scheme and would have ensured that the state second pension was not put in place. They would have completely undermined the pensions programme. That sounds like a particularly mad proposal, even for the Liberals.
Mr. Ernie Ross (Dundee, West):
I welcome my right hon. Friend's announcement. Can he confirm that our manifesto committed us, particularly with regard to pensioners, to considering the restoration of the link
Mr. Darling:
I am grateful to my hon. Friend. Most Labour Members are determined to do as much as we possibly can for pensioners, particularly those who lost out in the Tory years. We have linked the minimum income guarantee to earnings. That will help the poorest pensioners--all of us have come across them in our constituencies--who did particularly badly in the Tory years. I am sure that the free television licence will benefit older pensioners, many of whom live in households whose incomes are particularly low, feel isolated and cannot keep in touch. They find meeting the cost of a one-off bill, such as that for the television licence, a disproportionately heavy burden to bear. We are making progress because we are determined that all pensioners should share in this country's rising prosperity, but we have a clear obligation to tackle pensioner poverty, which the Conservative party did nothing about during the 20 years in which it had the opportunity to do so.
Mr. Edward Leigh (Gainsborough):
How does the relatively modest increase of 1.1 per cent. in universal benefits, such as the basic state pension, compare with the relatively generous increase of 4.9 per cent. in means-tested benefits, such as the minimum pension guarantee? Will that make it more or less likely that Mr. and Mrs. Prudence will make provision and save for their old age?
Mr. Darling:
Most people are making provision not only for their old age, but for other things. As the Chancellor made clear in his pre-Budget statement, we want to encourage that. I find it interesting that the Conservatives increased pensions and other benefits in line with prices for 18 years. It is most curious that, after two years in opposition, they seem to be hinting that they would have a different policy today. I doubt it.
Mr. Ivan Henderson (Harwich):
I represent more than 30,000 pensioners. Having met their representatives yesterday, I can tell my right hon. Friend that they welcome their £100 winter fuel payments for this year, next year and the year after, but what more can the Government do to ensure that pensioners who are entitled to do so receive benefit so that they can take advantage of the minimum pension guarantee?
Mr. Darling:
My hon. Friend makes an important point. We think that about 500,000 pensioners who ought to be receiving benefits to which they are entitled are not claiming them. Three weeks ago I published research highlighting the scale of the problem and I hope to announce, in the not too distant future, proposals showing the Government's determination to ensure that people entitled to help--through the minimum income guarantee or other benefits--receive it.
Mr. Archy Kirkwood (Roxburgh and Berwickshire):
I am very pleased that the Secretary of State has made such a point, because the minimum income guarantee is
The pilot studies of take-up seem to have fizzled out. It is urgent that the Secretary of State takes action to remedy the problem before he can be safe in the assumption that he is tackling pensioner poverty. The Government have said that they are looking at capital thresholds for means-tested benefits. Increasing such thresholds would be an easy way of addressing the problem.
Mr. Darling:
The hon. Gentleman raises several points. On the latter, the Government have made it clear that we are concerned about capital limits. We want to encourage people to save, and they ought to be rewarded for doing so.
On take-up, the pilot projects have not fizzled out. They are being assessed and, as I said to my hon. Friend the Member for Harwich (Mr. Henderson), we hope to announce the conclusion of them before announcing further steps to ensure that pensioners who are entitled to the minimum income guarantee and other benefits receive them.
Yes, the basic state pension's value is being maintained, but the minimum income guarantee goes to those poorest pensioners who lost out. I would have hoped that the hon. Gentleman would agree that our concern must be particularly for pensioners who have received the least over the past few years. The winter fuel payment--quite significant help--will be going to every eligible pensioner household in the next few weeks. In addition, of course, from next year, there will be free television licences for over-75s. I remind the hon. Gentleman, too, that we took 200,000 pensioners who were paying tax out of such a bracket. All that adds up to valuable support for pensioners who, as I say, were neglected for far too long under the Conservatives.
Mr. Paul Flynn (Newport, West):
As one of the 100 Members of Parliament who have long campaigned for the restoration of the link between pensions and earnings, may I congratulate the Government on giving benefits to pensioners that are at least equivalent to--and possibly higher than--the amount that they would have received had the link been restored? None the less, there is a serious problem, and the campaign to restore the link must go on.
At least 500,000 pensioners do not claim the minimum income guarantee, although they are the poorest pensioners. The reason is that they have worked all their lives, never claimed any benefit, made contributions at the rate of inflation for 45 years or so and will not demean themselves by filling out forms and claiming a hand-out. They see the basic state pension as a right. There is therefore a great difference between increasing it and giving more hand-outs.
Although the Government are right to give prime attention to helping the poorest pensioners, the Minister and I were elected on a pledge that all pensioners would share fairly in the growing prosperity of the nation.
We must address the fact that a group of the poorest pensioners are losing out before we return to the country to ask for their support.
Mr. Darling:
My hon. Friend is right that everyone on the Labour Benches was elected on a pledge to ensure that pensioners shared fairly in the country's rising prosperity. We are delivering on that. I think that my hon. Friend would accept that we are right to concentrate the additional money that we are making available--some £4 billion--on the poorest pensioners who have lost out over the past 20 years. An across-the-board increase does not help the poorest pensioners, because they lose any such increase pound for pound. Many at the top end of the scale would not of course notice the difference in their weekly income.
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