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Mr. Gardiner: Will the hon. Lady give way?
Mrs. Lait: I am terribly sorry; we are desperately short of time. If the hon. Gentleman had been here for most of the debate, I might have been more tempted.
What we have heard from pensioners is consistent and clear. They are saying, "We do not like being patronised. We do not like being told how to spend our money. We think that the plethora of allowances and benefits is confusing. We do not like the nanny state." We listened and we acted.
It was my hon. Friend the Member for Bromsgrove (Miss Kirkbride) who, in an excellent exposition, outlined exactly what we have proposed. Despite the shortness of time, I will run through it quickly. It is important that we get it on the record because so many wild accusations are floating around, including the one from the Secretary of State, who, I am delighted to see, is back in the Chamber and who persists in saying that our increase is £5. It is £5.50. I would be grateful if he tried to get that fixed in his brain.
We took the Government at their word that the state pension would next rise by between £2 and £3 a year. We then took the money that they are spending on winter heating and on free television licences. We added the age addition for the over-80s and the Christmas bonus. We looked at the savings that we could achieve from abolishing those gimmicks. We added the money to be saved from winter fuel payments to men aged between 60 and 64, which the Government did not plan originally to give them. We took some of the extra money that the Government have put into the social fund and we used the money from the failed new deal for lone parents.
We were then able to promise--
Mrs. Lait: I am afraid that the Secretary of State is too devoted to "The Hitch Hiker's Guide to the Galaxy". That is not the answer to everything.
We were then able to promise all pensioners the increases that--
Mr. Darling: Will the hon. Lady give way?
Mrs. Lait: I would dearly love to give way to the Secretary of State. It would be a huge--
Mr. Darling: Clearly, the Conservative party has been on a hitch hiker's guide to the galaxy. It has come up with exactly the same answer, which is 42p.
Mrs. Lait: What we have come up with is the answer that pensioners want. Pensioners want to get rid of the gimmicks that the Government have been buying them off with. They want the dignity and self-respect to pay their own way on their own budget on a weekly basis. They know that if they receive the money weekly, any future increases will be based on that increased state pension. Many Members are trying to portray it as a one-off increase. It is not. It will increase and roll on year by year. The base rate has gone up.
Mr. Greenway: Will my hon. Friend give way?
Mrs. Lait: I will give way briefly because I am aware that my hon. Friend wanted to speak.
Mr. Greenway: In the catalogue of things that we propose to save money on to pay for the package,
does my hon. Friend include the more than £20 million a year that it will cost to run the bureaucracy to give the free television licence?
Mrs. Lait: That is, indeed, part of the savings increase. My hon. Friend tried hard to get into the debate, but was not able to.
Mr. Kaufman: Will the hon. Lady give way?
Mrs. Lait: I am sorry. I will not give way again as I have only four more minutes.
Mr. Kaufman: On a point of order, Mr. Deputy Speaker. Has the hon. Member for Ryedale (Mr. Greenway) approached you to have Hansard corrected in view of the fact that Hansard reports him as warmly and enthusiastically supporting the free television licence that he now nods at as a gimmick?
Mr. Deputy Speaker: The right hon. Gentleman is an experienced Member and knows that he is trying to pursue a point of debate under the guise of a point of order.
Mrs. Lait: We were able to make those promises two weeks ago. My right hon. Friend the Member for Richmond, Yorks (Mr. Hague), our leader, made the promise at that time. I shall read the relevant paragraph from his speech because, clearly, many people have not read it. He said:
- We would also adjust tax allowances for older people to compensate pensioners for any extra that they might otherwise pay.
- we would adjust means tested benefits to ensure that the poorest pensioners gain at least as much as other pensioners.
Many pensioners are telling us that our proposal gives them dignity and choice. We have been able to give them what they require to feel that they are decent, honourable and upstanding members of society, unlike the Government, who continue to patronise, to confuse and to dish out sums of money to meet their political ends, not the requirements of pensioners who are our first priority.
3.49 pm
The Minister of State, Department of Social Security (Mr. Jeff Rooker): Is that it? Opposition Members have finished speaking, Mr. Deputy Speaker, and you have called me to speak, but I have not really heard anything yet. However, looking at the Order Paper I was struck by the fact--I am a bit superstitious; I do not walk under ladders or do anything like that--that, as my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) said, the Opposition have chosen, on their 13th allotted day, to debate pensions. They have told us nothing new about pensions, other than that they will
spend exactly the same money on pensions as is now being spent on them. No one will ever remember the Opposition's motion, but everyone will remember the substance of it: this is the 42p pension debate. That is what Opposition Members have talked about today. That is what it amounts to.We have not heard anything of substance that is new from Opposition Members, and they know it. They also know that their proposal is a con. That is why they were so angry with my right hon. Friend the Secretary of State for finding them out so quickly. As the hours passed, they changed their position and squirmed about their so-called policy initiative.
There have been some interesting speeches from both sides of the House, and some of them were thoughtful. The hon. Member for Bromsgrove (Miss Kirkbride) covered a range of subjects, some of which were partisan. However, I think that there is a meeting of minds that, in the years since the war, the House has not exactly shone with glory in addressing the issue of pensioners' incomes. As I said, there have been various attempts--by Richard Crossman, Boyd-Carpenter, Barbara Castle and even Keith Joseph--simply to get to grips with the fact that the basic state pension was never intended to be the sole source of income.
Since 1948, that has been the basic tenet in the pensions debate, and the Labour and Conservative parties have both made attempts to deal with that fact. Regrettably, so far, of all those attempts not one has come to fruition in the House. Legislation was passed on one proposal, but it was never implemented. Other proposals have been modified over the years. However, the basic underlying fact is that we have to do something to get pensioners a second income, and preferably not one that relies on the vagaries of Governments, Chancellors and the national insurance fund. If people can have access to a separate, funded scheme, they will be better provided for. The consequence of that fact has been growth in occupational pension schemes and the creation of the stakeholder pension system, which will be funded.
Nevertheless, we must always--I make no apology for this--bear in mind the total income that pensioners receive, and we should not centre the entire debate on the basic state pension. For one thing, many people do not receive the basic state pension because they have not paid enough into the national insurance fund. There have been quirks in the national insurance system since it began, and they are grossly unfair to many pensioners. If people do not, for example, accrue 25 per cent. of a pension, they receive nothing--[Interruption.] Hang on; I am making a speech on behalf of the Government. I am not going to be told by Opposition Front Benchers what to say.
The underlying thrust of the Opposition's motion is that the basic state pension is the be-all and end-all of pension provision, and that we must never talk about other aspects of the matter. Opposition Members think that, by manipulating a debate on their own terms--just on the basic state pension, as if that is what people live on--they will appeal to pensioners.
As my right hon. Friend the Secretary of State for Social Security said, in 1997-98 the average pensioner income was £132, which is twice today's basic state
pension amount. That sum includes SERPS, occupational pensions and personal pensions. It is also an average, and many people receive a much higher sum.We make no apology whatsoever for targeting our extra resources on the poorest pensioners. We came into office and discovered that when the previous Labour Government left office, 40 per cent. of pensioners retired on to means-tested benefit. Today, the percentage is much lower--28 per cent. The fact is that those who do retire on to it, relative to those who do not, are much poorer than they were in 1978. In 20 years, the income differential between the top fifth and the bottom fifth of pensioners has changed from 2.5:1, to 3.5:1. We cannot close that gap without getting more money, and faster, to the poorest pensioners in relation to the general population. That is the reality, and increasing money across the board simply will not work.
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