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2.56 pm
Miss Julie Kirkbride (Bromsgrove): I am especially pleased to follow my colleague, the right hon. Member for Manchester, Gorton (Mr. Kaufman), who is the Chairman of the Select Committee on which I serve. I have considerable respect for him, but on this occasion, he has used his formidable intellect to distort Conservative party policy on pensions. He suggested that we proposed to condense the winter fuel payment, the Christmas bonus and other payments made to pensioners into one weekly payment. He knows full well that that will not last for one year; it will be continuous. The increase in money that we will give pensioners will be sustained. That is more than the Government propose now because of the administrative savings and money from other Government programmes, which will be added to the overall amount that will be given to pensions.
Given the right hon. Gentleman's considerable intellect, I am surprised that he did not mention--perhaps because of partisan politics--that as well as pensioners receiving
a higher weekly payment, on which future upratings will take place, the money will also be index linked in a way that I presume the £10 Christmas bonus and other payments have not been for some years. He distorts our party policy on such matters--[Interruption.]
Mr. Deputy Speaker: Order. The hon. Member for Colne Valley (Kali Mountford) must not interrupt the hon. Lady while she is speaking.
Miss Kirkbride: Thank you, Mr. Deputy Speaker. I am grateful to you for calling me after the right hon. Member for Gorton, so that I can swiftly put those matters right for the record.
I do not wish to speak for too long because this is, sadly, a short debate on an important policy matter which affects a huge proportion of our citizens, who clearly feel strongly given the amount of publicity and news attention surrounding pensions during the past few weeks. However, I am proud to stand on the record of what the Conservative party did for pensioners in our 18 years in office and what we propose to do. Sadly, our proposals are subject to distortion by Labour Members. They distort what happened to pensioners and their incomes during those 18 years.
A third of pensioners now have incomes that are in the top half of all incomes in the country. That is a considerable achievement, for which we deserve some of the credit in so far as we encouraged occupational and private pension schemes. I wish that more than a third of pensioners were in that position, but back in the 1970s and before, pensioners were almost universally poor. That is not so nowadays and they mirror the rest of the population: some are well off, some are fairly well off and, sadly, some, like other people, are poor.
It is Conservative Members' duty to point out that all pensioners, given their service to this country and their status as senior citizens, should be allowed to live in dignity and decency, and should have enough money to do so. I accept that all Members want to achieve that objective, although it will be expensive in so far as others will have to pay.
Kali Mountford: Will the hon. Lady give way?
Miss Kirkbride: I will, but I hope that the hon. Lady does not make more partisan points.
Kali Mountford: I am grateful to the hon. Lady for giving way on the point of pensioner poverty. Given that her party--and, it seems, the Liberals--does not support the £150 winter fuel allowance, I am intrigued to know how she would tackle the problems of those who have suffered from hypothermia in winter. That payment has made a significant difference to pensioners' use of heating over the winter months and could save lives.
Miss Kirkbride: I am sorry to have to say that the hon. Lady's question is extremely ignorant and completely misses the point: we propose to give pensioners that money weekly rather than annually. They will still receive it, so her point is ridiculous as it lacks any intellectual credibility whatever. I am sorry that I gave way.
I was developing the point that we improved pensioner incomes and increased income support for poorer pensioners during our 18 years in power. The Government have introduced measures on similar lines, but given them different names. For example, they call family credit the working families tax credit. On the whole, the policies are similar and, in a civilised society, it is right and proper to help poorer pensioners. I take great comfort from the fact that many people drawn from the spectrum of 10.5 million pensioners--getting on for 20 per cent. of our citizens--can live out their lives in some financial security. That is good news on which we want to improve. To that end, the Government have a case to answer.
We all accept that pensioners' incomes are vulnerable because they can no longer work. They are not in the marketplace and feel insecure because they are unable earn more--their incomes are static. People fortunately live longer, but inflation may erode the money that they receive, which is a worry. Therefore, it was extremely mean of the Labour Government to create a position in which pensioners can no longer get back the tax on their dividends. That smacks of the class envy that we have seen in the past few weeks.
Pensioners who happen to have a few shares in British Gas, BT or any other stock portfolio are not necessarily rich. The tax that they get back is a significant part of their income and they are entitled to it, especially given the vulnerability of their income position. It was mean and spiteful of the Government to stop pensioners claiming back their tax, and that measure contrasts markedly with the new proposals for the tax regime: whereas the tax man would have taken £40 million from a dot.com multi-millionaire who made a profit of £100 million, fat cats, as the Government used to call them, will now be able to keep £90 million and hand the Treasury just £10 million. That sits uneasily with depriving pensioners--who by no conceivable definition are the rich in society--of a legitimate part of their income.
The same goes for the Government's sins of omission as for their sins of commission against the pensioners--they have done nothing about annuities. Many pensioners who, in good faith, set up a financial portfolio under which they would be obliged to buy an annuity at 75 face a serious situation that has perhaps been made much worse because the Government will not be involved in the gilt market as much as they once were. That is welcome in many ways, but pensioners will be adversely affected and face relative penury because the Government simply will not act. They should do something for those pensioners, a number of whom from my constituency regularly write to me, pleading for the Government to act. As one does as a Member of Parliament, I send those letters to the Treasury, only to get the usual blanket, stonewall answers. The Government have committed a gross sin of omission. If they want to claim that they are the pensioners' friend, they must consider that issue urgently.
I support what my party proposes to do with the state pension after the next election and I am pleased that it looks increasingly likely that we might win.
Miss Kirkbride: My hon. Friend encourages me to tempt fate, but one must never do that in politics.
However, the political landscape has changed dramatically over the past few weeks. I enjoy speaking to the Women's Institute in my constituency and must report to the House, as a matter of record, that I have never been slow handclapped by the Bromsgrove WI. I congratulate the WI on its view of the Prime Minister.One reason for the change in the political landscape is that pensioners prefer the dignity of the pension being paid under the contributory principle, which we shall offer them at the next election, and like the idea of people being entitled to that money because they earned it during their working lives. Our proposals are not a gimmick and they do not represent a handout. That money could not be taken away at the whim of a Chancellor who thought that it was no longer a good idea to continue with any extra payment such as those introduced by this Government.
The Government's public relations used to be so sure-footed, so I cannot understand why the Chancellor has been foolish enough to give more money to pensioners--we accept that he has done so--in a grossly offensive way. That has backfired in terms of the pensioners' view of the Government: 75p was given on a contributory basis, but other money was given in the form of gimmicks and handouts. The sooner they learn their lesson, the better. Labour Members have been so excitable today because, in their heart of hearts, they know that too.
I commend our pension plans to the House. They are right for pensioners, some of whom would benefit by much more than the 42p claimed by the Government and the Liberal Democrats. Not all pensioners get free television licences; some do not even have to buy one. Those people would be helped by our policies. As my hon. Friend the Member for Havant (Mr. Willetts) said, pensioners on income support who live in nursing homes do not benefit from the winter fuel payment, but they would get our extra money for the basic state pension. Several groups would benefit from the straightforward principle of giving pensioners what they deserve--an enhanced weekly pension.
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