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Dr. Lynne Jones: Will the hon. Gentleman put his hand on his heart and tell the House that had the Government not put in extra money for pensioners, he would still be advocating his proposal--in a way, very welcome--to increase the basic state pension? Furthermore, the next time that we have low inflation--as a result of the state pension being linked to inflation, the result is an increase of the state pension by a paltry few pence--will he argue that he will increase the pension by more than those few pence?

Mr. Willetts: I think that hidden in that intervention there was a tribute to the wisdom of the Conservative policy on pensioners. I shall take that in the spirit in which it was intended.

As in so many areas of policy, we are clearing up a mess that was created by the Government. They are the people who have created muddle and confusion. They make the benefit system more complicated every time that they make a new statement and introduce a new policy. We are offering pensioners respect for their ability to manage their own money and their own entitlements in the way that they wish. We are offering them the dignity of an entitlement to a contributory benefit. The Prime

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Minister was rumbled yesterday, and the Secretary of State has been rumbled. Pensioners have rumbled the Government.

1.50 pm

The Secretary of State for Social Security (Mr. Alistair Darling): I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:

'condemns the Opposition for making no commitment to the welfare of either today's or tomorrow's pensioners, opposing every step the Government has taken to help pensioners and producing proposals for next year's basic pension uprating which amount to bribing pensioners with money which is already theirs; recognises the legacy of increasing pensioner poverty left by the last Government; applauds the Government for doing more to help all pensioners, spending £6½ billion more than planned by the last Government, but most for those who need help most by concentrating half the additional money on the poorest quarter of pensioners; congratulates the Government for tackling poverty directly with the Minimum Income Guarantee, helping take-up through better publicity and simplified claims procedures; supports the Government's plans to help those pensioners who just fail to qualify for the Minimum Income Guarantee by raising the capital limits to £12,000 from April 2001 and committing itself to bringing forward proposals for a Pensioner Credit which will reward thrift; congratulates the Government for helping all pensioners with their costs, including Winter Fuel Payments and free television licences for people aged 75 and over; and applauds the Government's strategy for ensuring that, in the future, nobody who has put in a lifetime of work or caring need retire onto means-tested benefits, including a commitment to the basic state pension, a state second pension which does more for 18 million people including those on low and moderate pay, with caring responsibilities or broken work records because of disability, and new flexible, low cost, stakeholder pensions.'.

What was rumbled within hours of its announcement was the Conservative policy on pensions. It did not stand much examination before it became perfectly obvious that the Conservatives, having opposed every extra penny that we were spending on supporting pensioners, were taking that money and offering to spend it in a different way. There was no new money. The public and the rest of us should beware of Tories bearing gifts, because we have some experience of what happened during the 18 years that they were in government. They were not noticeably the pensioners' friend or on the pensioners' side. They left 2 million pensioners living in poverty. The gap in incomes between the better-off and the poorest pensioners was as great in 1997 as it had been 40 years earlier, and one third of people working today were heading for a retirement in which they would be dependent on benefits from day 1 because of inadequate second pension provision. Of course, we also all remember the millions of people who were mis-sold personal private pensions--something that the Conservatives encouraged when they were in office.

Today we have heard the first big idea from the hon. Member for Havant (Mr. Willetts). The Conservatives are trying to bribe pensioners with money that they were going to get anyway from the Labour Government. The Conservatives are giving money with one hand and snatching it away immediately with the other.

Let us look at what the Tories are promising this time. I remember taking part in an interview with the hon. Gentleman on the "Today" programme on the morning of his great announcement. He said that he was going to give £5 more to single pensioners. It did not take long to find out how he had reached the sum of £5. It is quite easy:

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£3 from the winter fuel payment, which we introduced and the Conservatives opposed, plus at least £2 from the inflation increase. The hon. Gentleman is trying to tell pensioners that he has £5 of new money, which he knows full well they were going to get anyway.

However, the hon. Gentleman's policy did not last for very long before it began to fall apart. When I heard him say that the House of Commons Library had helped him, I began to get suspicious. During the 13 years that I have been in the House, I have often found that when people start praying in aid the House of Commons Library, it is as well to see exactly what the Library said. As we know, it is a reputable and scrupulously impartial research organisation.

I asked the House of Commons Library--or, to be absolutely accurate, because I do not want to mislead the House, I got my parliamentary private secretary to ask the House of Commons Library--what it had said to the hon. Gentleman. The researcher said:

Taking into account his proposals to abolish Winter Fuel Payments, free TV licences for the over-75s, and the Christmas Bonus these increases would leave single pensioners under 75 £0.42 per week better off.

There we have it. Within hours of the announcement being made, it turns out to be not £5, not £7 and not £10, but 42p. That is what the Tories are promising pensioners. The Tories should bear in mind the fact that one reason they lost office after 18 years was that people did not believe a word that they said. Today we have heard yet another attempt to con people into believing that the Tories are offering more money, when the truth is that they are offering 42p. As the Library helpfully goes on to say:

No account is taken of income tax effects.

The figure also fails to take account of the fact that many pensioners will lose benefits.

Mr. Patrick McLoughlin (West Derbyshire): I should like the Secretary of State to clear up what he has just said, for the sake of accuracy. Did he say that he asked his PPS to ask the Library to provide the same information that was provided to my hon. Friend the Member for Havant (Mr. Willetts)? Is he aware that the Library is usually very strict in how it presents information to individual Members? If the Secretary of State is saying that the information that was given to my hon. Friend by the Library was also given to his PPS, I hope that he is misleading the House.

Mr. Darling: I do not know the proper procedure for this situation, but I am more than happy to place in the Library the information that my PPS--my hon. Friend the Member for Stockport (Ms Coffey)--obtained. It was a proper inquiry, and before the hon. Gentleman gets on his high horse, he should remember that when the Tories were in government they frequently asked the Library what information it had provided to Opposition Members.

The letter starts by saying:

You asked about David Willetts' plans for increases to the Retirement Pension, which he has stated as being based on work by the House of Commons Library.

It continues by making the point that the answer is 42p. Lest the Tories think that I am being unreasonable, or that the Library was being unreasonable in telling us what it has done, I shall explain why the sum of 42p has some

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credibility. About five hours after the hon. Member for Havant appeared on the "Today" programme, his colleague the shadow Chancellor appeared on "The World at One". [Hon. Members: "Where is he?"] It is no wonder that he is not here, because I am about to tell the House what he had to say. When he was asked about the policy, which hon. Members will recall had been spun across every newspaper the night before, he said:

We are making quite a limited announcement today.

He was certainly right about that. He continued, with refreshing candour:

We are not over selling this at all; it is a one-off policy.

Of course it is a one-off policy, because there is no way that, with their tax guarantee, the Tories can find more money for pensioners in the future. The shadow Chancellor went on to say:

It is money which is already being spent.

We have had smoke and mirrors from the Tory party.

The shadow Chancellor made other revealing points, which bring me on to the point made by the hon. Member for Havant about losers. Under the hon. Gentleman's proposals, some 2 million of the poorest pensioners would lose out because the Tories will not give an undertaking to increase the minimum income guarantee in line with earnings. Indeed, the Tories are against the minimum income guarantee, or at least they were until two weeks ago. The shadow Chancellor was revealing on that point, because when he was asked about an extension of the MIG and whether it would, in time, be linked to earnings, he said:

You are leading me now into a policy area in which we haven't yet made a statement.

He continued:

all other announcements about our attitude towards pensions and the minimum income guarantee and so on are a matter for the future.

There we have it. The shadow Chancellor made it clear that the Tory party was performing a smoke and mirrors trick, by promising money that was already being spent. He said that it was not a big deal, because the net effect, after all was said and done, was 42p extra.

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