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Minimum Income Guarantee
8. Mr. Phil Sawford (Kettering): How many pensioners in the Kettering constituency are benefiting from the minimum income guarantee; and what steps he is taking to encourage further take-up of this benefit. [120944]
The Secretary of State for Social Security (Mr. Alistair Darling): About 2,400 pensioners in Kettering are benefiting from the minimum income guarantee. To encourage pensioners to take up their entitlement, we have launched a national helpline, which has already received nearly 31,000 calls in the last five weeks. As I said earlier, we are launching a national television advertising campaign on 30 May to ensure that as many pensioners as possible get their entitlement.
Mr. Sawford: I thank my right hon. Friend for that answer, and I welcome the work that he is doing to help our poorest pensioners and to ensure that pensioners are aware of their entitlements to MIG. Does he agree, however, that many pensioners will lose out on other benefits if they take up MIG, and will he consider the wishes of the many Labour Members who want him to restore the link with earnings?
Mr. Darling: As my right hon. Friend the Minister of State has just said, if we restored the earnings link, the very pensioners my hon. Friend is concerned about--the poorest--would be worse off. Because of the way in which the benefit system works, they would lose their benefit pound for pound. That is why we chose a different approach in MIG, which increases the amount of money pensioners on MIG receive by £14 a week for those under 75 and£16 for those over 75. I hope that, on reflection, my hon. Friend will agree with me that the object of Government policy should be to ensure that the oldest and poorest
pensioners, who lost out in the 18 years that the Tories were in power, get the most help. Restoring the earnings link would have saved us £2.5 billion. We are spending more than that would have cost, but half the amount that we are spending goes on the poorest 3 million pensioners.
Mr. Crispin Blunt (Reigate): How do I convince a 50-year-old man in my constituency--
Madam Speaker: Order. The substantive question is about the Kettering constituency.
9. Mr. Mike Gapes (Ilford, South): If he will make a statement on the future of the minimum income guarantee for pensioners. [120945]
The Minister of State, Department of Social Security (Mr. Jeff Rooker): MIG is directly helping 1.6 million of the poorest pensioners. It should help about another 500,000 of the poorest pensioners who do not claim it, for various reasons. As my right hon. Friend the Secretary of State said, a major Government-sponsored take-up campaign will commence on 30 May. We will write to2 million people among whom, we suspect, are the 500,000 who have been missed out. As I have already said, we are examining for the longer term how best MIG can provide help to those pensioners who have provided for themselves, particularly those with occupational and other small pensions and modest savings.
Mr. Gapes: I am grateful for that answer and I welcome the publicity campaign. However, is my right hon. Friend aware that large numbers of pensioners do not understand MIG, and that there is widespread concern,if not hostility, among pensioners because of the complexities of the social security system? In the review of MIG, will he look again at the concept and the way in which it is applied, so that it can become a minimum income guarantee for all pensioners, not just those on income support?
Mr. Rooker: My hon. Friend will know that, as I have said, more than 1.6 million pensioners are already successfully claiming MIG. Other pensioners are claiming council tax benefit and housing benefit and are eligible for MIG but, for some reason, do not claim it. That is a dilemma that we hope to solve through the take-up campaign.
I do not accept that hostility to MIG exists, although there is hostility to the process because some people do not want to go near a Benefits Agency office. However, they will not need to do so, because, once the campaign starts in May, they can apply over the telephone. All that they will have to do is sign and date a form. There has been hostility to the 40-page form which, among other things, asks whether one is pregnant, but that will not need to be filled in. Only the parts directly relevant will be needed.
Any remaining hostility will be assuaged by the announcement made in the middle of March that we will dislocate all pensions activity from the Benefits Agency to a totally new pensions service that will be devoted exclusively to pensions and pensioners.
Mr. Julian Brazier (Canterbury): The Minister keeps referring to people on small occupational pensions. Some
pensioners with occupational pensions look enviously at the minimum income guarantee. Will he say how large a lifetime pension fund they would have to have saved to match the minimum income guarantee?
Mr. Rooker: Not off the top of my head, as I am not armed with those figures. However, I am not sure that the hon. Gentleman's argument is not somewhat disreputable, in that he is setting one group of pensioners against another. He talks about people who do not have an occupational pension, a personal pension or a second pension, but many people never had the chance to make such provision, or could not afford it. He implies that somehow they have been feckless in their lives and that they therefore do not deserve the help of the minimum income guarantee.
Mr. Frank Field (Birkenhead): I draw the attention of my right hon. Friend to a group of people who have been anything but feckless, and about whom I wrote to him after the issue arose at the previous Social Security Question Time. Some people with a small occupational pension are thereby ineligible for MIG. However, if they had been eligible for MIG, they would have received passported benefits, free housing and free council tax. In my letter, I drew attention to a simple reform. At present, eligibility is determined according to MIG income qualifying levels, but a better system would be to calculate the level of income for which people would be eligible if they were on MIG and gained housing benefit and council tax benefit in full.
I copied my letter to my right hon. Friend the Chancellor of the Exchequer. He wrote back to say that he had passed it on to my right hon. Friend, who was in charge of the review. It is good news, for pensioners and for the House, to have my right hon. Friend in charge of the review. When will he be reporting?
Mr. Rooker: By "he", my right hon. Friend means my right hon. Friend the Secretary of State who, as the pensioners' champion, is quite rightly leading the review. The point that my right hon. Friend makes is correct. Pensioners who have an income because they have a small occupational pension above the minimum income guarantee can be worse off under the current benefit provision: because they do not get MIG, they lose the other benefits. Those are the people to whom the hon. Member for Canterbury (Mr. Brazier) referred. They are exactly the target group at whom our review is directed. We will report back to the House by the November statement, as my right hon. Friend the Chancellor of the Exchequer announced. By that time, we will have a proposal to deal with that very group of people.
Mr. Crispin Blunt (Reigate): How do I convince a 50-year-old man in my constituency, on a low income and with no savings, to save for his retirement, given that he would need to save £100,000 so as not to qualify for the minimum income guarantee? Would he not be far better off spending that money on himself over the next15 years, as he then could enjoy the minimum income guarantee?
Mr. Rooker: Well, I hope that the hon. Gentleman spelt out the facts of life to his constituent. Anyone of50 who has not provided for a second pension is leaving
it a bit late. People on low pay cannot do much in that regard in the last 10 years of their working lives. The tragedy is that, for some years to come, people will come off the conveyor belt of work and enter retirement having not had the opportunity to save and put money by for a decent second pension. They will be dependent on the state, and the state will therefore have a duty to help them.We have introduced the minimum income guarantee for those people who did not have the opportunity, during their working lives, to make provision for a second pension. I hope that the hon. Gentleman had the guts and courage to tell his constituent that the Tories would abolish it.
Disability-related Benefits (Appeals System)
10. Ms Julie Morgan (Cardiff, North): What plans he has to shorten the appeal process for disability-related benefits. [120946]
The Parliamentary Under-Secretary of State for Social Security (Mr. Hugh Bayley): We have introduced a new system to streamline and modernise the appeals system for all benefits. For disability living allowance and attendance allowance, the right of appeal can now be exercised at an earlier stage. The appeals service has already made significant improvements to clear backlogs and reduce waiting times. We are seeking to improve the service still further.
Ms Morgan: I thank my hon. Friend for his reply,and I welcome his remarks. However, does he agree that waiting for appeals is stressful for constituents, particularly for those with mental health problems? Will he look into the case of my constituent, Mrs. Jenkins, whose disability living allowance was withdrawn in April 1999? She is still waiting for a tribunal, which is due to be heard in June 2000. This is causing her acute distress and mental anguish, and is confining her to her home.
Mr. Bayley: I can reassure my hon. Friend that I will certainly look at Mrs. Jenkins's case.
My hon. Friend may be interested to know that, in her local appeals service office in Cardiff, some 21,500 cases were waiting to be heard one year ago, in February 1999, and more than half of that number--some 11,300 cases--waited for longer than six months. Today the figures have dropped, so that only 9,588 cases are outstanding, and only 2,161 are more than six months old. So we are making progress.
Mr. David Tredinnick (Bosworth): Does the hon. Gentleman have any plans to allow Motability cars to be retained during the DLA appeals process until it has been completed? Is he aware that a constituent of mine has been forced to hand back the car and make alterations to it, returning it to its original state and removing special hand controls? Would it not be better to have a system whereby the car was retained until the appeals process was completed? Is the hon. Gentleman further aware that the problem is something to do with the Customs and Excise arrangements on value added tax? Will he please undertake to look into the matter and write to me about it?
Mr. Bayley: I am aware of the case. The hon. Gentleman has written to me about it and I have replied--
it may have been one of the letters that I signed at the weekend. The Government have an interest in Motability, in that we pay the higher rate mobility component of DLA that pays for Motability cars. However, Motability is an independent charity and is responsible for its own rules. As the hon. Gentleman recognises, it is not possible for people who are not in receipt of DLA to retain theircars because the scheme receives considerable VAT concessions from the Chancellor and other Government concessions and support. That support can be given only because it goes to people who are in receipt of a benefit. Those who are not in receipt of a benefit unfortunately cannot retain their cars.
Mr. Tim Boswell (Daventry): Will the Minister accept that, while any improvement in acceleration in the appeals process is welcome, as long as it is consistent with justice, most claimants are looking not so much for the appeals process as the substance of their claim? Will he also accept from the case of Colin Hughes, and many like him, that there is very little link, if any, between the extra costs of disability and the means of the disabled person? In the light of that, would it not have been better if, instead of their Scrooge-like imposition of means-testing on incapacity benefit, the Government had introduced a more effective medical test for new claimants?
Mr. Bayley: I am slightly reluctant to discuss an individual case on the Floor of the House. However, the hon. Gentleman has referred to it on two occasions, and I think that I can refer to some details that the claimant, Colin Hughes, has made public.
I admire Colin Hughes greatly. He is a severely disabled man who has made a successful career within the BBC. The difficulty that he faces with his benefit is that the independent living fund administrators were not aware of his salary at the BBC. Had they been aware of his salary, he would have received no support at all under the old means-testing rules, introduced by the hon. Gentleman's party when it introduced the independent living fund. As a result of the changes that our party has made to relax the means test to provide a greater return from employment for the relatively few people who are supported by the independent living fund and who can work, Colin Hughes would be able to keep a greater proportion of his earnings--which is a good thing--if the question of his savings were resolved. I have discussed with those who manage the independent living funds ways in which the savings that anybody else with perhaps a longer life expectancy might have put into a pension scheme can be put into some form of trust fund so that they can be disregarded in whole or in part.
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