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Andrew Selous: I should like to develop that tribute on behalf of the Opposition. I, too, am a member of the Select Committee and have been very happy to serve under the chairmanship of the hon. Member for Roxburgh and Berwickshire. He chairs the Committee in an exemplary manner and I appreciate the opportunity to thank him for all that he has done.

Malcolm Wicks: That was a gracious tribute.
 
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I do not want the House or the massed ranks of my colleagues to think that I am going soft on the Liberal Democrats, as I may speak slightly differently about the hon. Member for Northavon (Mr. Webb). The Government faced a strategic challenge, as too many British citizens were born poor, had an impoverished and diminished childhood—often, but not always, in fragile families. As a result, they achieved little at school and ended up with poor educational attainments. Some, but not all, of those children were at risk from evils in our society, and when they left school, sometimes before 16, they did not take up education, employment or training. That is a problem—it may not be as sizeable as some have said, but that is not the point. The Connexions service in England and the learning and skills councils were established in part to tackle such issues.

As a result of those diminished childhoods, too many of our citizens end up without work or with poor job opportunities. They often have poor skills and are on low pay. That cycle ends with many people becoming impoverished in old age and receiving poor pension entitlements. The challenge for those of us interested in a modern welfare state is a traditional one—how do we break the cycle of poverty and deprivation and try to move towards a cycle of achievement and opportunity for all our citizens? We have not entirely met that challenge, which still faces us, but we have made progress. I am proud of our record on children and the fact that total spending on financial support for children has gone up by over £10 billion in real terms since 1997. I am proud of the fact that, since 1997, families with children will on average be £1,300 a year better off, while the poorest fifth will on average be £3,000 a year better off. It is notable that, in December 2004, nearly 20 million people, including 10 million children, benefited from the new tax credits. I accept that there have been problems with tax credits, but many people have benefited from them.

I noted carefully, as did the Secretary of State, the issues surrounding the overpayment of tax credits. The Department is not responsible for that, but we share concern about it. I shall investigate the adverse impact and interaction with other benefits that have been mentioned, as well as issues about capital that the hon. Members for Roxburgh and Berwickshire and for South-West Bedfordshire (Andrew Selous) raised. I accept that we need to look at that.

The child trust fund will make a meaningful difference to the savings environment in future generations by promoting positive attitudes towards savings. This is not an occasion to debate the Child Support Agency, but my right hon. Friend the Secretary of State has read carefully the excellent report from the Select Committee, to which we will respond in weeks. We are not happy with the performance of the CSA. Those children need support from both parents, wherever possible. We must make progress and we intend to do so. I have mentioned some of what we are doing for children. I cannot deal with the subject holistically as that would mean speaking more about education.

As regards people of working age, we are again proud of our record. Unemployment is at a 30-year low. The number of people in work is up by 2 million since 1997. There are more than 28.5 million people in work, the highest number ever. Compared with the G8 or the
 
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European Union, our employment rate of nearly 75 per cent. is almost at the top of the international league table. Iceland is top at 80 per cent. I do not know whether the Secretary of State has visited Iceland—I refer to the country, not the superstore—but our ambition now is an employment rate of 80 per cent.

Opportunities for people with disabilities will be greatly increased by the measures in the Disability Discrimination Act 1995. That is very relevant to our employment ambitions. By focusing on what people can do rather than on what they cannot do, we are determined to help the many who are currently on incapacity benefit and want to return to work to do so. We are doing that through our pathways to work and new deal programmes. I was pleased to hear the hon. Member for South-West Bedfordshire comment favourably on aspects of our policy in this regard. It is a challenge for all of us to recognise that, although there is much discussion of the appropriate retirement age, too many of our citizens are effectively retired in their 50s, rather than their 60s.

Mr. Willetts: The Minister referred to the Government's target of 80 per cent. employment in the document which, we discovered today, the Secretary of State wrote. Will he explain to the House how that target was reached? Will he confirm that it is an extrapolation of a long-established trend?

Malcolm Wicks: It is certainly an extrapolation in the sense that we are doing so well in tackling unemployment and raising the employment rate. We want—I am trying to think of a phrase that might sum it up—we want to go forward, not back, and we intend to go forward. [Interruption.] I thought that was pretty original. If the hon. Gentleman calls that an extrapolation, fine.

The new deal has been a tremendous success, with more than 1.2 million people helped into work through that programme. Sadly, Opposition Members want to scrap that policy. Since 1997, long-term youth unemployment has fallen by two fifths. The new deal for young people has helped more than half a million young people into jobs. We are engaged in making work possible, making work pay through tax credits and the minimum wage, and making work skilled. That is the challenge for us.

Over the long term, the more successful we are in our policies for children and people in work, the more successful we will be in overcoming pensioner poverty. As the Secretary of State said, the best pension policy of all is a job. For the current group of pensioners, the pension credit is a success. It now reaches 3.2 million people and, as has been noted, two thirds of those people are women, partly because they live longer, partly because they do not have full national insurance contribution records—hence the important debate about the future of state pensions—and because in their careers many men have been nowhere near a decent works or occupational pension. The Opposition parties criticise us for using pension credit because it is means-tested. As we have said before, in the short to medium term, it plays a vital role in tackling pensioner poverty. Since 1997, our policies have lifted 1.8 million
 
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pensioners out of absolute poverty. Now, through pension credit, 2.4 million people in almost 2 million households are receiving more money than before.

As a result of the measures that we have introduced since 1997, an extra £10 billion will be spent on pensioners in 2005–06. Almost half that extra spending—about £5 billion—is going to the poorest third of pensioners. As we have said, we think that 80 per cent. of those entitled to the guarantee level are claiming, and 90 per cent. of the poorest women are doing so. Many people are £36 a week or more better off as a result of our policies.

Mr. Webb: If the Minister can quote guarantee credit take-up figures, he must be able to quote savings credit take-up figures. What is that take-up rate?

Malcolm Wicks: I cannot quote those figures off the top of my head. If we have them, I shall write to the hon. Gentleman. We were uncertain whether he had asked the question and whether I had replied, but we will look at the matter to see if we can be helpful.

Lynne Jones (Birmingham, Selly Oak) (Lab): I have just been at a meeting of the all-party group on pensioner incomes. We were given a presentation by the Pensions Policy Institute, which put the figure on take-up of savings credit at 50 per cent.

Malcolm Wicks: I cannot say whether that is accurate. We will look at the figures. Until I noticed who my hon. Friend was, I was hoping that she might be rather pleased that, among her poorer constituents, and women in particular, pension credit was doing well. I am sure that she is pleased about that.

Lynne Jones: I would prefer it if we had a citizen's pension ensuring that all pensioners got at least £105 a week.

Malcolm Wicks: On the state second pension—I often feel that we do not talk enough about this—we believe that designing a policy that helps low earners means that 5.8 million people are now building up a state second pension. Particularly notable is the fact that 1.9 million carers are now building an entitlement to a state second pension.

The shadow Secretary of State, whom we wish a long career in that role, is very interested in deemed buy-back, which was a feature of our warm-up debate in Westminster Hall, which had a slightly larger crowd than we have now at some stages, on the APW case. We have spoken about the issue, and although I am a master of detail, it may be that there are some other things about which I could write to him. We think that 800 individuals have so far been offered deemed buy-back. We think that only eight individuals have so far taken up the offer. The majority of the rest are still considering their position. I am taking a good deal of interest in the matter so that we can facilitate movement in this area.

The shadow Secretary of State also asked me about the total numbers that we had unearthed, to put it rather badly, in our research exercise on the financial assistance scheme. The list that we published today indicates that
 
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there are at least 380 defined benefit pension schemes whose members should potentially be eligible for financial assistance. There are about 70,000 non-pensioner members in the schemes. The figure is therefore more or less consistent with the estimate that we published last June, suggesting that there were about 85,000 non-pensioner members in affected schemes, about 65,000 of whom were facing significant losses. It looks like our early estimates were broadly correct.

I have talked about today's pensioners, but in terms of today's work force and tomorrow's pensioners, the Pensions Act 2004 is of enormous significance. The new regulator will have sharper teeth than the old regulatory framework, which is a significant development. The Pension Protection Fund is a landmark reform offering security and helping to build confidence for some 10 million pension scheme members in defined benefit or what are sometimes known as final salary schemes. That is a major new part of our welfare state architecture, and one day we will look back with some pride on legislating for it.

Meanwhile, as we know, for groups of workers already in very debilitating circumstances who could not be helped by the PPF because it was not yet there, we have the financial assistance scheme, which has excited considerable interest today. The scheme is important. We will provide those people who are around pension age—some of them are coming up to it and some of them have already passed it—with a core pension entitlement of some 80 per cent. I hope that that meets my pledge to this House that the help for those groups would be "significant" or "substantial". I hope that we have kept our word, and I am sure that we have. The possibility of reviewing the finances in the short to medium term is a further step in building confidence.

In his winding-up speech, the hon. Member for Eastbourne (Mr. Waterson) referred to the important APW case and seemed to imply that support from the financial assistance scheme or the Pension Protection Fund should be generally available to solvent employers. I wonder whether that is a serious suggestion—I am not making a party political point—and whether it is a serious spending pledge on the financial assistance scheme.

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