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Mr. Jeremy Corbyn (Islington, North): I have a great deal of sympathy with what the hon. Gentleman has said. In his assessment of pensioners' living standards, has he made any calculation of the increasing costs imposed on the elderly in day centre and home help charges and all the other charges made by local authorities of all parties throughout the country? Obviously, those charges affect the living standards of a specific group of people who used to have to rely on an inadequate pension and now have to rely on an inadequate pension minus the charges.

Mr. Webb: The hon. Gentleman is absolutely right. That is exactly the sort of item that should appear in the

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index of goods that we take into account when we consider what should happen to pensions, even though it has no impact on the retail prices index.

In a year in which the Government had money for pensioners, they put nothing into the pension. A sentence of death is hanging over the state pension. By our votes this evening, we have a chance to bring it a reprieve.

4 pm

The Minister of State, Department of Social Security (Mr. Jeff Rooker): I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:

"notes that the Government inherited a situation where increasing numbers of pensioners were living in poverty and where, if nothing had been done, one in three people would have retired on to means-tested benefits by the middle of this century; congratulates the Government on the start it has made in dealing with these problems; applauds in particular the introduction of the Minimum Income Guarantee, benefiting one and a half million pensioner households, and welcomes the Government's commitment to raising it in line with earnings for the rest of this Parliament and to conducting a take-up campaign to ensure that pensioners get what they are entitled to; supports the Government's commitment to helping pensioners, including the restoration of free eye tests and the new winter fuel payments, which benefit over seven million pensioner households and will be paid every year from now on; welcomes the Government's commitment to extending further help with pensioners' needs, including free television licences for people aged 75 or over from next autumn and the extension of concessionary public transport fare schemes; supports the Government's commitment to letting pensioners benefit more from their savings through the minimum tax guarantee which now means that two thirds of pensioners now pay no income tax; and welcomes the Government's plans to reform pensions, through the new stakeholder pensions and second state pension, so that everyone who puts in a full life of working or caring will in due course be able to retire on an income above means-tested levels.".

I welcome this debate--one of the key debates for the Liberal Democrats. The subject, which they have chosen, is important to the Liberal Democrats here and to the Government, but it clearly not important to 72 per cent. of Liberal Democrat Members, as they have not bothered us with their attendance: a factor that they can explain in due course to their constituents.

Mr. Tom Brake (Carshalton and Wallington): Cheap.

Mr. Rooker: Oh, yes. We will have some cheapness today.

I regret the fact that I shall have to use some figures and statistics today; I shall try to keep them to a minimum but, in rebutting some of the points made by the hon. Member for Northavon (Mr. Webb) it is inevitable that I shall have to use some. As the hon. Gentleman said, the motion deals only with the supposed inadequacy of the 75p increase. The rest of what he said is not in the motion. It is on the record, but that is not the same as presenting a motion to the House that can be debated.

The hon. Gentleman did not tell us what is quite clear: that the Liberal Democrats have changed their policy since the general election. We make no apology for fulfilling our manifesto commitment--and indeed going beyond it. It is well known that the commitment on which we were elected was to use the basic state pension as the building blocks of pensioner income and to raise it at least in line with prices. That has been done for three years.

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On page 49, the Liberal Democrat manifesto--I am not taking this out of context; I shall quote the whole sentence--said:

"The basic state pension will remain indexed to prices."

That is exactly what the 75p is. The manifesto also said:

"We will create an additional top-up pension for pensioners with incomes below the income support level. This will be indexed to earnings".

That is exactly what the minimum income guarantee is. As my right hon. Friend the Chancellor has said on more than one occasion, it will continue to be index-linked to earnings.

The Government have put into effect two key planks of the Liberal Democrat manifesto, and we are being held to account and complained against today with regard to one of them. I am not sure whether there has been a change in Lib Dem policy.

Mr. Paul Burstow (Sutton and Cheam): Yes.

Mr. Rooker: Oh, there has.

Dr. Jenny Tonge (Richmond Park): Will the Minister give way?

Mr. Rooker: No, I must make a bit of progress. I have not actually started my speech yet. I made those introductory remarks to get the tone of the debate right on the matters on which we are being attacked, one of which is pensioner incomes.

The hon. Member for Northavon sometimes talked about the basic state pension and sometimes about total pensioner incomes, although he never quite put it that way. If any right hon. or hon. Member knows a pensioner who lives on an income of £66.75 a week--the basic state pension--and who has no capital over £3,000, it is their bounden duty to ensure that he or she gets the benefit of the minimum income guarantee. Everywhere I hold meetings--including pensioners' convention meetings--I say, "Hands up, anybody who is getting only £66.75." I know that that is slightly unfair because, by their nature, such meetings may not be attended by the poorest, but so far, no one has put their hand up.

The Government are deliberately targeting resources on the poorest pensioners, but the reality of pensioner incomes is different. The average income for a pensioner couple now, on 1996-97 figures--the latest ones, which were published in 1998 in the pensioner income series, although we will have more up-to-date figures by the end of the month--is £248 a week. The average income for a single pensioner is £129 a week.

It is true that there is a difference with age. For couples in which the male is aged over 75, the average income is £226 a week, and for the others it is £259 a week. It is a fact that, as pensioners get older, their income falls. Among single pensioners, the average income for men is £141 a week, and for women it is £126. It is a myth that the generality of pensioners exist on £66.75 a week.

Mr. Simon Hughes: No one is saying that.

Mr. Rooker: The whole thrust of the speech by the hon. Member for Northavon was directed towards perpetuating that myth.

Mr. Corbyn: My right hon. Friend the Minister will have heard my intervention in the speech by the

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hon. Member for Northavon (Mr. Webb). In the assessments made by my right hon. Friend's Department, what examination has been made of the cost of living index as it relates to pensioners in terms of transport costs, increased charges imposed by local authorities and the loss of former public facilities that now have to be paid for privately? All the evidence that I have seen suggests that pensioners are becoming significantly worse off because of cuts in local services.

Mr. Rooker: I say to my hon. Friend genuinely that the whole range of income is taken into account. I am giving average figures, which are the only ones any of us can give unless we use an individual example. In many ways, we succeed or fail in this place by giving individual examples of our constituents, but when we make a global assessment, we have to use averages based on pensioner incomes and expenditure. The factors that my hon. Friend mentioned are taken into account. We must remember that averages can be misleading. However, that does not alter the fact that the figures that I have given show that average pensioner incomes are now totally different to what they were 20 years ago.

Mr. Simon Hughes: I am sure that the Minister understands that, even given the Government's present policy of the minimum income guarantee or the policy that he is right to say that we had at the last election--although we have moved on since--of a minimum basic income, a minority of pensioners do not get anything above the basic state pension. Will he confirm that there has never been a 100 per cent. take-up and that there probably never will be? If we are to meet the needs of the poorest pensioners, we must do something other than keeping the pension down and getting pensioners to make up the difference by applying for other benefits. Many people refuse to apply for those other benefits because they fear means testing and see it as degrading.

Mr. Rooker: I accept the point. As the hon. Gentleman knows, we have three sets of benefits. We have the means-tested income benefits and the minimum income guarantee, for which we will shortly announce a Government-led, national take-up campaign. It will be a unique campaign for a Government to run.

However, many other benefits are not income related, yet their take-up remains a problem. For example, attendance allowance take-up by pensioners is about 40 per cent. of what we think that it should be. It is difficult to drive a take-up campaign on benefits that are not income related, but the hon. Member for Southwark, North and Bermondsey (Mr. Hughes) is right: the Government have a moral obligation and duty to target resources on the poorest pensioners. The campaign will cost several million pounds, and we shall announce the details shortly.

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