| Previous Section | Index | Home Page |
Mr. Coaker: Everyone agrees that take-up is a serious matter, but does the hon. Gentleman not acknowledge that it is a bit more complicated than that? He should consider attendance allowance, which is non-means-tested. There is a take-up problem with that benefit as well.
Mr. Webb: The hon. Gentleman is quite right that take-up of that benefit is a serious issue and there is no doubt that it is good that the Department has started to estimate and consider non-take-up, but the research--if I recall correctly--was almost exclusively into non-take-up of income support by pensioners. We did not need that research. As I used to make my living from social research, perhaps I should have said that it should have been undertaken alongside action.
Mr. Chris Pond (Gravesham): The hon. Gentleman may be doing research again.
Mr. Webb: I thank the hon. Gentleman for that.
To give a concrete example of action, half the pensioners who do not take up income support even though they are entitled to it are housing benefit or council tax benefit claimants. In other words, we know where they live. Why should it take the Government three years to launch an advertising campaign or a strategy when we have their names and addresses?
Mr. Coaker:
This is an interesting debate. Has the hon. Gentleman given any thought to why pensioners do not seem to have a problem claiming housing benefit and council tax benefit, which are means-tested, but seem to have a problem claiming income support?
Mr. Webb:
Indeed. One of the main reasons is that most are council tenants. They have contact with officials
What will happen eventually? I hope that there will be linkage between local authority data and income support and that pensioners who fill in housing benefit forms and are told that they are entitled to a full rent rebate will automatically receive letters telling them that they are entitled to income support. They would have provided the authorities with every bit of information needed to calculate their income support. So much more could have been done years ago, but the Government amble along.
The classic case is the Secretary of State's ritual nonsense about the state second pension and the mythical person who receives £14 a year under SERPS and will receive £50 a year when the state second pension is introduced. When? In 2047. That is the pace of Government pension reform. I am not asking for the earth, just a bit of speed.
Mr. Willetts:
Like me, the hon. Gentleman follows Ministers' written answers on this subject very carefully. Does he agree that we need citizens charter standards to interpret the various ministerial statements? Widows' SERPS was to have been dealt with "shortly" back in October 1999 and there was to be an announcement on the winter fuel payments mechanisms "early next year" in December 1999. It would be nice to know what "early next year" and "shortly" mean in the Department of Social Security.
Mr. Webb:
I thank the hon. Gentleman.[Interruption.] That is an interesting sedentary comment from the Minister: those words mean 7 February. That is intriguing.
Mr. Rooker:
I said that it is only 7 February.
Mr. Webb:
I apologise. In a moment of revelation, I thought that we were to have an announcement, but no.
While we are on the theme of delay and dither, let me say that housing benefit reform is a classic example. I have lost track of when it was originally supposed to take place, but we now read in The Daily Telegraph that it will take place in July. Even then, it will not be a wholesale reform; it may take three Budgets to introduce it. For goodness sake, what do we pay officials in the Department to do? Surely the Government could tackle some of the issues rather than deferring them for another Parliament, which appears to be their strategy.
Mr. Rooker:
I did not want to say this publicly, but it is the second time the hon. Gentleman has had a go at the officials in my Department. The last time he did so during a debate he called them a bunch of bureaucratic anoraks. These are the people whom I personally asked, at the hon. Gentleman's request, to do a bit of extra work by answering some of his unofficial questions--questions that he could not get on to the Order Paper. I shall think twice about co-operating in that way in future.
Mr. Webb:
I am sure the right hon. Gentleman would not afford me any privilege that he would not afford
At root, this is a debate about next April's benefits, of which the basic state pension is far the largest component. What should be done, given that the Government have an excess of billions of pounds in the national insurance fund? We think that the Government should do two things, as we made clear when the matter was debated a few weeks ago. First, all pensioners should receive an increase that reflects their true cost of living. That is a serious, constructive and relatively inexpensive suggestion, which we have made before but which the Minister has ignored. I hope that he will respond today.
Mr. McWalter:
Is the hon. Gentleman saying that we should uprate in line with the pensioner index rather than the standard index? It seems that he is. If the pensioner index was lower than the standard index, would he give pensioners less than 75p?
Mr. Webb:
That is a perfectly fair point. Each year, the Government would have to decide whether to use the pensioner price index or the all-items retail prices index. When I am Secretary of State for Social Security, I will opt for the higher figure.
As I have said, the increase should reflect pensioners' true cost of living. We all know of pensioner costs that are not fully reflected in the retail prices index: local authority costs such as council tax and rent, for instance. The classic example, however, is the mortgage rate, which was falling in the year to September. Such a fall hits pensioners twice. First, it depresses the retail prices index without helping with pensioners' living costs, as most have no significant mortgage, if any mortgage at all. Secondly, it depresses pensioner incomes, which, to a greater or lesser extent, depend on interest rates. If interest rates fall, pensioners' savings incomes fall. Then the Government kick them in the teeth by saying, "As inflation has been low, we shall not give you a pension increase of any note."
It is all very well to say that next year it will be different--that, as mortgage rates will rise next year, pensioners may receive a bit more. Pensioners must live on the 75p increase for a year; if the council tax eats all that up, what are they expected to live on? They will just have to wait: that is the Government's message to pensioners.
As for the second thing that should happen, it is not a restoration of the earnings link. I want to make it clear that we are not saying that. We propose across-the-board increases in line with the true cost of living for all pensioners, and a "bigger than earnings link" increase for those over 75. We suggest that the across-the-board increase for older pensioners should be £3 for the over-75s and £5 for the over-80s, and that we should build on that increase.
The Minister mentioned the help that I had received from his officials in the past. I have been uncharitable, and I withdraw what I said. Over the summer, along with the Secretary of State's assistant, those officials helped me
to estimate the effects of some of our policies. We were grateful for the opportunity to use the Government's simulation model to cost the policy of increasing the age addition to a serious amount that would grow over time, rather than retaining the pathetic 25p which is frozen in the orders. For the same cost as the state second pension that the Government propose to introduce, we could do vastly more for poorer pensioners, and less for the best off. I am not suggesting any more spending overall. This is not "tax and spend", but--I hate to use the "r" word--redistribution. It is about helping poorer pensioners.
The problem with all the Government's plans is that they will take years to be implemented and will benefit only the newly retired--who, on average, are the best-off pensioners. Therefore, it will be even more decades before the money reaches the folk who are the poorest. By that time, probably three different parties will have entered and left government and either ripped up or changed the policy, so that we shall never achieve the objective of the policy. We need action that will have an impact now, and that action should be an across-the-board age addition.
On average, older pensioners are the poorest--but we would not have to means test them to discover whether they are. For reasons that we know, older pensioners are more likely to be women. Older pensioners are also more likely to have retired longer ago, so that their savings will be more depleted and inflation will have eroded more of the real value of any assets. Additionally, lump-sum purchase on a house will have come out of their savings. Widows' entitlement, which many older pensioners receive, is also very poor. The list is endless. However, for those specific reasons, poverty is concentrated among older pensioners.
Non-take-up of income support is another phenomenon that is concentrated among older pensioners. Two thirds of pensioners who do not claim income support are over 75. By paying across-the-board increases to older pensioners, we shall be getting money to the real poorest pensioners.
The poorest pensioners are not the ones who claim income support, but the ones who could but do not. Although Liberal Democrat Members support putting money into income support--we do not have a problem with that as a way of helping those who receive it--we believe that that is not sufficient. Action on income support would target some of the poor, but not all of them.
| Next Section
| Index | Home Page |