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Mr. Betts: I am trying to get the figures correct. The figure of £3 billion is in the public domain, but most people scratch their heads and wonder how it is calculated. Does it include the cost of paying back the pensions to which people would have been entitled if the rule had not existed in the first place? It is difficult to understand how there can be a one-off cost if all that happens is that people's entitlement is restored from now on.
Mr. Murphy: My hon. Friend identified in his opening remarks some of his own estimates from a retired civil servants' organisation, and rather than discussing the methodology this evening, I undertake to share with him some of the analysis of how the Government Actuary arrived at those figures. I hope that he will find that the most appropriate way to deal with the issue.
Of course, the Government recognise the strength of feeling on this issue, and the issues on which the Civil Servants Pensioners Alliance, which my hon. Friend mentioned, are campaigning will be considered during negotiations with civil service unions on the wider public service pensions reform agenda. There is a commitment to discuss these matters with the civil service unions, as part of the wider reform of civil service pensions; but of course, as before, any change must be met from within the existing cost envelope.
On support for pensioners more generally—of course, including those who are former civil servants—the Government have listened to pensioners and taken numerous initiatives to address their concerns. Reforms to state pensions and other measures introduced since 1997 have helped virtually all pensioners and targeted substantial resources on those most in need. The Government are setting up a £300 million fund over the next three years to provide pension credit recipients with free central heating, and providing discounts of £300 on central heating systems for pensioners who do not have them. Of course, we are continuing with the winter fuel payment, which is popular among hon. Members on both sides of the House and in all constituencies. I understand that there are about 18,500 recipients of the winter fuel payment in my hon. Friend's constituency.
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We are also spending about £10 billion extra in real terms on pensioners, following the introduction of pension credit: £7 billon more in 2005–06 than if the basic state pension had been linked to earnings since 1998. Pension credit was in payment to an estimated 6,300 claimants in my hon. Friend's constituency towards the latter part of last year. From April 2006, people aged over 60 and disabled people will be entitled to free off-peak local area bus travel in England, with separate arrangements already in place for Scotland. That will benefit up to 7 million over-60s.
Mr. Jim Cunningham: We all appreciate the tremendous efforts that the Government have made with issues such as pensioner poverty and pensions in general, but will my hon. Friend clarify something that he said earlier? Some spouses are unable to claim civil service pensions because they get married again. He knows that, very often in trade union negotiations, 1 per cent. might be traded off a wage increase to get something else, perhaps relating to pensions. Will such things be part of wage negotiations, or will there simply be a general discussion with the trade unions?
Mr. Murphy: My hon. Friend was a trade union official, so he talks from experience. I have no idea whether the processes have changed since he was at the height of his powers as a union negotiator, but I am happy to confirm to the House that we are content to discuss the pension entitlement of widows and widowers in the event of remarriage or cohabitation with the relevant trade unions as part of negotiations on the wider reform of civil service pensions. The matter is an aspect of pensions negotiations, rather than wage negotiations. However, before my hon. Friend takes too much heart from that statement, I reiterate that negotiations on civil service pensions must progress with regard to the existing cost envelope.
Mr. Cunningham: I thought that the Minister was going to say that. He made a key point when he said that there was a ceiling on the amount of money that could be spent. As he and I know, one does trade-offs in such a situation. I asked the question in the first place for clarification on whether the matter was being considered as part of wage negotiations, or as a separate issue relating to civil service pensions, and I think that he has answered me.
Mr. Murphy: We cannot hold such negotiations on the Floor of the House, although I sometimes think that if one wants to keep a secret, this is perhaps the best place to say something. If civil service unions feel strongly about the matter and wish to enter into dialogue with us, we are happy to hold a discussion, albeit on the premise that we keep to the existing spend and cost envelope.
Let me draw my remarks to a conclusion, albeit earlier than I promised. In 2006–07, as a result of the Government's measures, pensioner households will be on average £26 a week better off than they were under the 1997 system. The poorest 10 per cent. of pensioners in our constituencies will be £42 a week better off. Regardless of the outcome of the negotiations on pension reform, civil service pensioners and their dependents will benefit from the measures that I have outlined.
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I thank my hon. Friend the Member for Sheffield, Attercliffe for giving the House the opportunity to have this debate. He raised what he rightly called an important issue and brought a technical debate to life with his passionate contribution. I also thank my hon. Friend the Member for Coventry, South for taking an
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interest in the debate and participating in it, and hope that I have explained the Government's position effectively.
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