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3.28 pm
Mr. Desmond Swayne (New Forest, West): It is always a pleasure to follow the hon. Member for Watford (Ms Ward), even if I could not follow entirely her logic.
There are casualties of the policy announced by my hon. Friend the Member for Havant (Mr. Willetts) from these Benches, but those are proper casualties. The first casualty is the new deal for lone parents. My own lack of enthusiasm for it is largely a consequence of the fact that it does not work. The pilot schemes for the new deal for lone parents showed that marginally more lone parents acquired employment where there was no scheme in operation than where there was a scheme. It is therefore entirely appropriate that we should do away with the scheme and put the money into pensions, where it is more deserved.
With respect to the social fund, I have never been a fan of it. There are elements of the social fund that are attractive and desirable, but one element has always struck me as undeserving. I am glad that the Secretary of State for Education and Employment has come to share that view, and also to believe that where consumer durables or items of furniture are required, there should be a greater expectation of the family and other social networks to stump up, instead of an application being made to the social fund, with the expectation that benefits will provide for those needs.
I know about this, because my wife is heavily involved with a charity that aims to provide precisely those items. It caters particularly for the needs of expectant parents. I have always thought it odd that parents, and expectant parents, should exhibit such resistance to second-hand equipment, especially at the lower end of the income scale. The relatively well off are generally happy to receive such equipment; the poorer people are, the greater
their resistance seems to be. I think that that should be deprecated, and I am therefore not particularly exercised by the possible impact of our proposals on the social fund.As time is limited, I shall deal with only one issue. I believe--and my belief is confirmed by my interpretation of the deliberations of the Social Security Committee--that we were right to break the link with earnings. If the state pension scheme were funded the desire to restore that link would be unanswerable, but I feel that the state pension should continue to provide a minimum standard of living, so that people are encouraged to make other provision.
The Government have put a great deal of thought into developing policy on that. They have launched many initiatives to encourage people to make arrangements for second pensions. I welcome those initiatives. Although many may have been misdirected, I think that the intention was proper and clear. I feel, however, that that intention has been undermined by the determination to uprate the minimum pension guarantee in line with earnings, which is an obvious disincentive. The main thrust of the policy was to encourage people to make their own arrangements to acquire second pensions, particularly lower down the income scale.
There was one point on which I tended to agree with the hon. Member for Watford. It is clear to those of us who do not resile from the breaking of the link with earnings that the decision to continue uprating in line with prices must be tempered with a better understanding of what constitutes the retail prices index for pensioners. It is obvious to me that the current arrangement for uprating pensions does not affect pensioners' real cost of living.
Kali Mountford: I have some sympathy with the hon. Gentleman's view that we should think again about whether there should be a pensioners' price index. Does that form any part of his party's policy?
Mr. Swayne: As I enjoy the freedom of the Back Benches, I think it proper for me to draw attention to what I consider to be problems, in the hope that my party's Front Bench will consider and address them. That, I think, is the proper role of Back Benchers.
This is one problem that I would like to draw to the attention of those on the Front Bench. I do not believe that our current arrangements take adequate account of the real costs of living for pensioners. If we continue to uprate pensions in line with prices--especially in the case of pensioners at the lower end of the income scale--we must take into account the real increases in their living costs. Otherwise, we shall face outrage every year.
3.34 pm
Kali Mountford (Colne Valley): We have been confronted with a conglomeration of views and an examination of pension history that are beyond belief. There has been a complete misunderstanding of the way in which social security budgets are stacked up, how important they are, and why they should be as they are.
I am particularly concerned about two issues. One is the "robbing Petra to pay Paul" syndrome--a policy requiring babies to have second-hand prams and cots to pay for a pension scheme. I would not wish to subscribe to such a policy. I thought that the state pension should have a firm foundation, but the foundation for the proposals that we
have heard today does not seem at all secure. They are based on taking away parts of the social security budget, and replacing them from elsewhere.The hon. Member for Havant (Mr. Willetts) did not give a clear answer to our questions about the national insurance fund. If we are to change the basis of national insurance, let us be honest about it and have a proper debate about whether the national insurance fund should fund state pensions. The hon. Gentleman did not say that this was the new position, but if we examine the figures closely it is clear that state pensions would have to be financed by general taxation.
The figures simply do not add up. We are considering a package of measures aimed at those who need help most. It cannot make sense to say that the package does not, in the main, come from the national insurance fund--because it is paying for state pensions--and that we could somehow roll it up together and thus make a big increase in state pensions.
We are not even being honest and recognising that fact. Those who have drawn attention to it have been told that there are surpluses in the national insurance fund. Every time I have looked at the fund, I have concluded that the alleged surpluses are there for a good reason. They are there because that is how the social security budget must be accounted for. It must cover a range of matters--matters that the House has debated repeatedly. People simply will not accept that a short-term surplus cannot, in perpetuity, finance increases in the state pension, unless we review national insurance contributions.
The Opposition have not even said what they would do with the national insurance fund. They think that they can just tinker with the figures, but such tinkering will fool no one. It certainly will not fool those who will find £150 on their doormats in November, when they need it most. It is diabolical to suggest that it is patronising to give the poorest people the help that they need when they need it most, and it is also misleading. The aim seems to be to drag people into a debate based on fear.
Mr. Barry Gardiner (Brent, North): Is the suggestion not also financially illiterate? If the poorest pensioners receiving the winter allowance had received the money in the basic pension, they would have lost it pound for pound through income support.
Kali Mountford: My hon. Friend is right. The Opposition claim that that is incorrect, but we have heard no firm statement because the figures do not add up.
Time is short, but I want to point out how vital it is to continue the winter fuel payment. Both opposition parties are opposed to that. Clearly they have not noted the views of Age Concern and Help the Aged, which have consistently said that hypothermia is claiming lives year on year. They say that it is a question of respect, and not patronising people. How patronising is it not even to provide extra measures that would help those people?
It is all very well for the hon. Member for Northavon (Mr. Webb) to say that some people could retain the benefit, but they may not be those who need it most. The people who need it most are those in receipt of the minimum income guarantee. The Opposition have decried the minimum income guarantee as something that has not
been special, although increases in it, year on year, have been far above any increases paid to pensioners in the past. Although some pensioners have not experienced the benefit, it has gone to those who have needed it most.3.40 pm
Mrs. Jacqui Lait (Beckenham): It has been a telling debate. For our side, it has been telling to watch the massed ranks of the Government because the problem is that the opposition is on the Benches behind Ministers. To be able to say that their supporters were po-faced while the Secretary of State was, not terribly effectively, defending his own policy was a joy and pleasure to us all. [Interruption.]
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. I am sorry to interrupt the hon. Lady. I hope that outbreaks of sedentary comment will cease. It does not help the debate.
Mrs. Lait: I am always happy to get supportive comments.
We watched the Government's supporters not being able to support their own Front-Bench team and the Secretary of State. In fact, every contribution that we have had, other than the fairly technical one from the hon. Member for Colne Valley (Kali Mountford)--we do not have time to debate the technicalities, much as I would like to--and a part of the speech by the hon. Member for Watford (Ms Ward), basically said, "You have got it wrong. You have to do better." We have done precisely that. That is what the problem is. The Government's supporters and, indeed, the Government are thoroughly rattled by the very sensible proposals that we have made.
It is interesting. The first speech that I made at the Dispatch Box was--to give them credit--during a debate that was initiated by the Liberal Democrats, who tabled a motion suggesting that the 75p increase was not enough. I remember saying at that time that it was a measly increase, but it is interesting to note that their amendment today goes no further than their motion at the beginning of the year. They say, "We will pay pensioners more." Now we have the promise that they will tell us in a few weeks where the money is coming from. We all hold our breath, but we all know that the Liberal Democrats say one thing and do another, should they ever be given the opportunity, which I doubt.
We, however, have been listening very hard to pensioners. We have listened to the organisations that represent them. We have listened to our constituents comments in letters and at our surgeries. My goodness, I have a heap of letters, as I am sure every Member does--
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