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Mr. Waterson : Does the Minister agree with the comments of Mr. Mervyn Kohler of Help the Aged that the Department has designed a system so byzantine that no one can understand it?

Malcolm Wicks: No, I do not. The hon. Gentleman does not appear to understand that the fact that people do not have to fill in the form and that one of our experts can fill it in during a 20-minute phone call—people have only to verify the details—is a major step from old-style means-testing.

I welcome the Liberal Democrats' choice of pension credit for the debate because they have an interesting track record that should be understood. They opposed its introduction. When the hon. Member for Northavon (Mr. Webb) was not examining statistical methodologies, he stated on 25 March 2002:

"The savings credit neither rewards those who save today nor encourages people to save for tomorrow, and I urge the House to reject it outright."—[Official Report, 25 March 2002; Vol. 382, c. 629.]

Mr. Webb : Very perceptive.

Malcolm Wicks: The hon. Gentleman clearly stands by his comments, since he judges them to be perceptive. I am glad that someone does.

If we follow the hon. Gentleman's advice and spend all our pension credit money on increasing the basic state pension, we could increase the maximum rate from £77.45 to approximately £90. However, that would mean losses of around £30 a week for households that receive pension credit. The Liberal Democrats need to explain that to older and poorer people: if the Government foolishly followed their advice, the poorest would be denied £30 or more a week.

Although I do not agree with the Liberal Democrats' approach, I at least respect it and understand their position. However, it is curious to compare their opposition to pension credit with their comments in the Brent, East by-election campaign. I have a piece of paper which is so interesting that I shall subscribe to future editions. It is called "Focus on Pensions" and discusses pension credit. Since we are considering "honourable gentlemen" in the House and outside, I assumed that the headline might read "Scrap Pension Credit" or possibly "Take Away £30 from the Poorest Pensioners". However, it is: "Are You Missing Out?" The article states that "local Lib Dem"—they call themselves Lib Dems—campaigner Sarah Teather

"has launched a major campaign to urge all local pensioners to apply for the new Pension Credit".

She said:

"I want to make sure that all pensioners in our area who are entitled to the new Pension Credit actually claim it."

Once again, we understand that being a Liberal Democrat means never having to be consistent. What hypocrisy! I hope that the hon. Member for Northavon

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or his colleagues will say whether they are for or against the pension credit, and whether they would back or scrap it. Answer came there none. Liberal Democrat Members opposed the pension credit in Parliament, campaigned for its success at the hustings and soon they will doubtless claim that they thought of it.

Mr. Waterson: The Minister has been generous in giving way. I promise not to try to intervene on his speech again, unless provoked.

The virus is spreading, because in my constituency the Liberals are writing to pensioners extolling the virtues of the pension credit and demanding to know whether they will take it up. I am pleased that there is no by-election in my constituency, but I gather that in Brent, East the "local Lib Dem campaigner"—how that phrase rolls off the printing presses—lives in Islington.

Malcolm Wicks: The hon. Gentleman is looking very well, doubtless with the benefit of a summer holiday, and I am sure that a by-election will be much delayed.

A major part of the discussion must focus on not only today's but tomorrow's pensioners. The Green Paper and our response to it are crucial to the pensions agenda.

Mr. David Borrow (South Ribble): Unlike the Liberal Democrats, I strongly support the pension credit. I am pleased that such a policy has emerged from the demand in constituencies such as mine that were let down because small occupational pensions or savings were not properly taken into account. My supporters will deliver 35,000 leaflets to urge my constituents to apply for the pension credit.

However, having stressed the good points, I wish to raise a technical matter. When I was first elected to Parliament and means-tested benefits were examined, I was upset by the assumption that every £250 in savings resulted in an income of £1 a week. That has been changed and savings of £500 result in a notional income of £1 under the proposed pension credit. I believe that the figure remains excessive—

Madam Deputy Speaker (Sylvia Heal): Order. The hon. Gentleman must conclude his intervention.

Malcolm Wicks: That was an important and complex question. I welcome my hon. Friend's support for the pension credit. The Liberals are in some difficulties if they are honest on the pavement—a rare sight—and say that they are urging people to claim a credit that they would abolish if they came to power. However, that is a conundrum for them. The first £6,000 of savings are not taken into account. We estimate that 85 per cent. of those eligible for the pension credit will not have to bother us with details about savings. As he acknowledges, the withdrawal rate is more generous than it was in the past. We suspect that approximately half of all pensioners will qualify for pension credit, so there must be a cut-off point.

The hon. Member for Sutton and Cheam made some rather negative remarks about payment modernisation and direct payments. There are important reasons why the changes are happening. Order books and girocheques are vulnerable to fraud and theft; about £80 million is lost in the postal system and elsewhere every

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year. Sadly, on average, about 100 pensioners a week have their order book stolen, and some are mugged and seriously assaulted on their way to the post office.

It is vital that we recognise the importance of the post office network. The Government are putting a great deal of resource into the network: some £2 billion over the next five years, including £450 million earmarked to support the rural post office network. It is not for our Department, or, indeed, the Government, to ensure the future of every post office, but ensuring that the Post Office becomes a modern banking service offering Post Office card accounts and facilities that allow people to draw out their cash using other bank and building society accounts—as I do at our local post office here in the House, using my own bank account—will stop people walking away from the postal service. If we look at the statistics for before the change was introduced, we see that almost six out of 10 people in the newer group of pensioners—those who have retired in the last year or two—had their pension paid into a bank or building society account. That is why we had to transform the system.

To hear the Liberal Democrats whinge and moan about this issue, one might assume that applying for a Post Office card account was so difficult that only a few dozen people were doing it. In fact, I am advised that 1 million people have applied for one, and our working assumption is that some 3 million people will have them, although there may be more. It is up to the elderly person herself, not the Government, Ministers or the Post Office, to choose. I am sure that the new system will be a success. We are talking to the representative groups and listening to the issues as they arise. For those who find it impossible to access their money through a Post Office card account, or a bank or building society account, there will be a cheque-based exceptions service. We are working on its details, but I would like to assure the House that it will be there.

Mr. Alan Reid (Argyll and Bute): The Government's amendment to our motion refers to

"giving Post Office access through a number of current accounts".

May I draw the Minister's attention to the situation in Scotland, where the current accounts of the three main Scottish banks cannot be accessed at the post office? What are the Government doing to reach an agreement with the Scottish banks so that Scottish pensioners may have the same rights of access to their bank accounts at the post office as other pensioners?

Malcolm Wicks: I recognise that issue, and discussions with banks are proceeding.

Given that I am the Minister for Pensions, I have understandably focused on pensions issues, but it is important for us to recognise, as the hon. Member for Sutton and Cheam did, that there is a wider agenda. A specific issue that is close to my heart is the need to attack fuel poverty. As a young researcher, I worked on the appalling problem of hypothermia, which became known as the "old and cold" problem. It is a scandal that people die in the winter simply because they are too cold to live.

I am proud of the way in which we are tackling the problem. There is still some way to go, but the UK fuel poverty strategy, published in November 2001, was the

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first of its kind in the world. It set out a coherent programme to end the blight of fuel poverty for vulnerable households by 2010. What have we done so far? In England, the home energy efficiency scheme—now marketed as warm front—has assisted more than 600,000 households, and more than 30,000 new gas central heating systems have been installed. Grants have been increased to £2,500 for the over-60s. I am sure that all hon. Members who have visited elderly people benefiting from the scheme and seen the joy on their faces as they realised that they could now live in a warm home will back the project. The scandal of fuel poverty must be eradicated; it is a 19th century problem that should not have lingered on into the 21st century.

In terms of a healthier old age—which will be dealt with by the Under-Secretary of State for Health, my hon. Friend the Member for South Thanet—the extra resources that we are putting into the national health service are absolutely vital, as are the extra resources that we are putting into social services. My hon. Friend will also deal with some of the issues raised by the hon. Member for Sutton and Cheam in that regard.

We have set out programmes to improve the health and well-being of older people in the national service framework, which was published in March 2001. The framework delivers the commitments to older people made in the NHS plan. It tackles the differing levels of access to services and is rooting out age discrimination in the national health service. The framework will raise the quality and standards of health and social care for older people.

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