We are now looking at another example, as the hon. Member for Epsom and Ewell has raised questions about the chairman of the Personal Accounts Delivery Authority, Mr. Paul Myners. He has a record for dealing with issues in the City, which meant that when he was appointed by a perfectly proper procedure, he was been broadly welcomed by stakeholders as a serious figure with a strong record. He has a world-class business record and extensive knowledge of financial services. Judged in a fair and open competition as the best man
to lead PADA, his appointment has been widely welcomed by the industry, yet the hon. Gentleman has now attacked him. I ask myself whether this is yet another example of that hon. Member taking the opportunity to have a go [Interruption.]
Mr. O'Brien: I know that Paul Myners has written to the hon. Member for Epsom and Ewell, pointing out that while that hon. Member may not find his company of the sort that he would want, it appears that the Opposition spokesman on trade and industry matters invited Mr. Myners to dinner after Question Time. We seem to have a slight split on the Tory Front Bench there. I hope that the hon. Member for Eastbourne will continue to support personal accounts and perhaps put the hon. Member for Epsom and Ewell back in his box.
Danny Alexander (Inverness, Nairn, Badenoch and Strathspey) (LD): I am grateful to the Minister for advance notice of his statement. The uprating announced today will be welcomed by many, but tackling poverty must be the key test against which such statements are judged. On that basis, some serious questions need to be answered. Even with todays rise, the state pension is still worth less than it was in 1950. Is it not simply unjustifiable that the uprating in line with earnings is to be delayed until 2012 at the earliest?
Can the Minister confirm that, yet again, there is no uprating of the winter fuel payment? Is he not aware that due to rising fuel prices, that payment is now worth roughly half its value when introduced, leading many to slide back into fuel poverty? The Minister has talked about backdating the pension credit, but is he not aware that with between 1.2 million and 1.7 million people not claiming it, there will inevitably be some individual losers, notwithstanding the fact that money is being redistributed, as he rightly said, within the pension pot?
While the steps the Minister is taking to simplify the application process for pensioners are welcome, is he not accepting by doing so that complexity is a major barrier to benefit take-up? Does he not agree that with 51 different benefits and 250 different rates, Britains benefit system is the most complex in the world? Does he not further agree that that complexity makes the system a nightmare for many who will wish to claim todays uprated benefits such as pension credit? Is it not time to seek much greater simplificationthrough the introduction of a single working age benefit, for example? Does the Minister also agree that deep public anxiety about data security within the Department for Work and Pensions and about tax credits could also undermine benefit take-up? What reassurance can he offer to give claimants confidence in how their data will be handled by his Department?
The Minister mentions the pensions Bill, and we will carefully study the proposals on deregulation. The personal accounts scheme is welcome, but does the Minister share my concern that the mass means-testing of pensioners continued by todays statement could muddy the waters for many people about whether saving is worthwhile? What steps is he taking to ensure that those people, and
those with huge personal debts, will have access to appropriate advice to ensure that they are able to take the right decision?
One group of pensionersthe 125,000 whose pension schemes have collapsedwill have heard nothing of comfort in todays statement. Will the Minister tell us when he expects to publish the results of the Young review? Is it his intention, as was reported in the press at the weekend, that the assets within the unclaimed scheme should be privatised? Would it not make more sense to hand those assets over to the management of the Pension Protection Fund, which has shown considerable expertise? That matter cannot wait much longer and I hope that the Minister will give us some reassurances on that. [Interruption.]
As to winter fuel payments, we never intended them to cover all the costs of heating, lighting and so forth for pensioners. It has rather been a contribution towards those costs. We knowand I know from my time as Energy Ministerthat fuel prices dipped, but they have now come back up, which has meant significant changes in the cost of fuel on the market. However, as a result of our uprating of various benefits, particularly pension credit, for the poorest pensioners and the more general improvement in benefits and pensions for retired people, we also know that their income has steadily risen. They should be able to deal with issues around fuel poverty; indeed, we have been able to improve their position with respect to it. I hear what the hon. Gentleman says about winter fuel payments, but that is a matter for my right hon. Friend the Chancellor of the Exchequer. As far as I can see, however, the record on winter fuel payments from 1997 to now is an extremely good one.
The take-up of pension credit has been a long-term issue. It is the case that we have written as many as four or five times to some of the people who we think should be claiming pension credit. For various reasonsthey may not want to fill in the forms, or they may feel that they would not get very muchthey decide not to. Some of them are surprised when they make a claim, as they receive far more than they expected. We are still working to encourage people to take up pension credit. Indeed, we hope to visit as many as 600,000 pensioners during the coming year to see if we can encourage better take-up. The changes that will come into force in October 2008 will provide quite an incentive for people to move forward and take up pension credit between now and then.
The hon. Gentleman rightly refers to complexity, which has been a long-term problem for the pensions sector. Through the Pensions Act 2007, and indeed the new pensions Bill, we aim to simplify and clarify a very complex system indeed. The changes I have announced today, particularly the automaticity of benefit application, will help ensure that some of that complexity is dealt with.
The hon. Gentleman rightly asked about data security. Personal accounts will require the transfer of some data between HMRC and the pensions regulator. We want to ensure that it is transferred in an appropriate and proper way and that proper controls are undertaken in respect of it.
As for means-testing, we have sought to use it to ensure that we tackle the key issue of pensioner poverty. We have had considerable success in doing that, and the proposals that I have announced will help us to build on our record, but there is still much more that we can do. Changes that we are making in the way in which benefits are available will, over time, start to reduce some of the means-testing. We have never been in favour of it, but it is one of the best ways of targeting help on the poorest people.
I cannot yet give the hon. Gentleman a publication date for the Young review. I want to be able to look at it and consider it, and I know that it is likely to be quite a complex report. I hope to receive it in the next few days, and although I cannot give the hon. Gentleman a commitment, I hope to be able to say something about it before Christmas.
Mr. Brian Jenkins (Tamworth) (Lab): We all welcome upratings, but does my good friend the Minister intend to write to all the people in our community who attain the age of 80 this year, and along with it entitlement to the old age allowance, and inform them of what they should do with their new-found wealth when the allowance rises from 25p to 26p? Might it include buying a second-class postage stamp, or saving up for a first-class postage stamp? Is it not about time that this award, which is neither use nor ornament, was laid to rest?
Mr. O'Brien: I have to say that my hon. Friend sounds a bit like my mum. My mum has just turned 80, and she said, That 25p was a bit of an insultand a good friend of mine, Gwen Johnson, who runs the Atherstone pensioners convention, said, You need to get rid of that 25p, Mike. I am talking to my right hon. Friend the Chancellor, and I hope that we will be able to take some steps. I want to deal with what many pensioners regard as an insult, but if we do that, there must be a compensation measure. I hope that in due course we will be able to ensure not only that pensioners do not receive just 25p, but that they do not lose out as a result of any change.
Mr. Philip Hollobone (Kettering) (Con): What is the official estimate of the rate of inflation as it applies to pensioners, and how does it compare with the proposed increase in the state pension next year? Of the alleged £1,500 real increase in the state pension in the past 10 years, what percentage, on average, has been taken up by council tax rises?
This year the retail prices index is above earnings levels, and we have therefore increased the pension by the higher rate to ensure that people do
not lose out. As for the hon. Gentlemans question about council tax, the answer is thatas with many thingsit depends. It depends on whether someone is able to access the various benefits that are available to help people on the lowest incomes with their council tax. Numerous people across the country will benefit from some of the proposals that I have announced: we estimate that by 2010 up to 50,000 pensioners will be helped, many of them as a result of claiming benefits relating to council tax.
As was mentioned earlier, we have had problems in getting people to claim their pension credit, so we are making changes in relation to take-up. We are launching a campaign to inform people that they need not pay so much council tax, and that if they telephone the Pension Service it will not only ensure that they pay less, but perhaps enable them to claim pension credit at the same time. Reducing council tax would provide quite an incentive. People do not like paying taxes but they may also object to claiming benefits, and I hope that the council tax incentive can be used to get people on to benefits and lift them out of poverty.
Derek Conway (Old Bexley and Sidcup) (Con): The Ministers statement has been rightly welcomed in all parts of the House, but may I press him on the proposalitself very welcometo ensure that information is sent automatically to councils, especially when it concerns council tax and housing benefits? Will the Department encourage local authorities to make that facility widely known to council tax payers in particular? Given that administration can vary slightly between authorities, will the Minister monitor them to ensure that the system is implemented fairly and quickly? Many people are a little confused by all the form-filling and demands, and it is important for them to interpret his initiatives positively.
Mr. O'Brien: Yes, that is important. I hesitate to tell local authorities what to do, because they always object to it and then demand money. We will work with Age Concern and Help the Aged during the coming year to encourage take-up of pension credit. We hope and intend to introduce the changes that will establish automaticityas the jargon has itby October next year. People will then be able to claim a number of benefits with just one telephone call.
I believe that working with voluntary organisations on a national basis to mount our campaign will give us a considerable voice out there, but I hope that we can persuade local authorities to join in. Telling pensioners about, for example, the extra help with free transport that we will be giving them next year might provide authorities with a good opportunity to say to them, Actually, you can claim backdated pension credit until October, and after that a telephone call might well result in your paying less council tax and receiving more help in the form of pension credit. The hon. Gentleman is right: the opportunities are significant.
Mr. Angus MacNeil (Na h-Eileanan an Iar) (SNP):
Fuel poverty is the big issue for pensioners. In Stornoway, diesel costs £1.19 a litre. How does the Minister propose to help pensioners in rural and island communities who must pay more tax on fuel than people anywhere else in the United Kingdom and thus,
probably, in the world? Ironically, pensioners incur those costs when they collect their pensions, and when they go shopping. On large islands such as Lewis and Uist, 50-mile return journeys are not unknown. Just what can the Minister do?
Mr. O'Brien: The hon. Gentleman rightly talks of his island communities, but rural communities throughout the United Kingdom are affected by problems relating to distance. That is why we have a strategy to help rural areas, which has been announced by my colleagues in other Departments.
There are higher costs associated with living in beautiful areas. Such areas often require a degree of hardiness, given the problems that exist in them. We want to find ways of providing further assistance, particularly for pensioners, some of whom may be infirm and may experience difficulties with travel arrangements.
Sir Robert Smith (West Aberdeenshire and Kincardine) (LD): The Minister has rightly recognised that failure to take up pension credit means that some of the poorest pensioners are missing out on something to which they are entitled. The view of those on the Liberal Democrat Front Bench is that we should deal with the problem by reducing the need for means-testing. The Minister is trying to simplify the process and I wish him success with that, but to help us to judge his success in a years time, will he give us estimates of the number of people who he thinks are currently missing out on pension credit and the figure to which he expects that number to fall if his campaign has been a success?
Mr. O'Brien: It will not all have been done in a years time. A year from now the system will have been in place for only a couple of months, and I think it ambitious to try to tie me down to a figure representing a change over a couple of months. It is ambitious on the hon. Gentlemans part, and giving such a figure would certainly be ambitious on mine. What we have said is that we expect the introduction of the automatic entitlement as a result of a single telephone call to lift about 50,000 pensioners out of poverty by 2010.
Mr. Andrew Robathan (Blaby) (Con): On a point of order, Madam Deputy Speaker. I wonder whether I could seek your advice on how to correct misinformation in a particular case. I have here a document that states:
The Electoral Commission had referred matters to the Police therefore aspects of the Whitty review would have to be placed on hold.
That is in confidential minutes written by Michael Cashman, MEP. Earlier, the Prime Minister denied that. Obviously, that was inadvertent. How can we get the Prime Minister back to the Chamber to correct the record, so that the whole world will know that, in fact, the Whitty review has to be placed on hold because the police are involved?
Madam Deputy Speaker (Sylvia Heal): That is not a point of order for the Chair. The hon. Gentleman is an experienced Member, and I suggest that he write to the individual concerned to get clarification on the point he has raised on the Floor of the House.
Mr. Secretary Hain, supported by the Prime Minister, Mr. Chancellor of the Exchequer, Secretary Des Browne, Mr. Secretary Hutton, Mr. Secretary Woodward, Mr. Mike OBrien and Mr. James Plaskitt, presented a Bill to make provision relating to pensions, and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow, and to be printed. Explanatory notes to be printed [Bill 25].
Mr. Michael Fallon, supported by John Battle, Mr. Elliot Morley, Mr. Michael Meacher, Mr. Martin Caton, Colin Challen, Dr. Alan Whitehead, Hugh Bayley, Mr. John Gummer, Mr. Michael Jack, Julia Goldsworthy and Chris Huhne, presented a Bill to enable local planning authorities to set requirements for energy generation and energy efficiency in local plans: And the same was read the First time; and ordered to be read a Second time on Friday 25 January, and to be printed. [Bill 17].
Mrs. Sharon Hodgson, supported by Lyn Brown, Mr. David Blunkett, Mr. Barry Sheerman, Kelvin Hopkins, Ms Angela C. Smith, Anne Snelgrove, John Bercow, Mr. Ian Liddell-Grainger, Mr. Christopher Fraser, Mr. Mark Oaten and Stephen Williams, presented a Bill to amend the Education Act 1996 in relation to the provision and publication of information about children who have special educational needs; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 1 February, and to be printed [Bill 26].
Andrew Miller, supported by Tony Lloyd, Mr. George Howarth, Margaret Moran, Mr. Dennis Skinner, Mr. Andrew Smith, Mrs. Ann Cryer, Alun Michael, Mr. Kevan Jones, Ms Dawn Butler, Ben Chapman and Ann Clwyd, presented a Bill to provide for the protection of temporary and agency workers; to require the principle of equal treatment to be applied to temporary and agency workers; to make provision about the enforcement of rights of temporary and agency workers; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 22 February, and to be printed [Bill 27].
Mr. Julian Brazier, supported by Mr. John Gummer, Keith Vaz, Miss Ann Widdecombe, Mr. Jim Hood, Stephen Pound, Mr. John Hayes, Mr. Lindsay Hoyle, Mrs. Nadine Dorries, Jim Dobbin, Mr. David Burrowes and Mr. Greg Hands, presented a Bill to make provision for parliamentary scrutiny of senior appointments to the British Board of Film Classification and of guidelines produced by it; to establish a body with powers to hear appeals against the release of videos and DVDs and the classification of works in prescribed circumstances; to make provision about penalties for the distribution of illegal works; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 29 February, and to be printed [Bill 16].
Mr. John Heppell, supported by Mr. Anthony Wright, Mr. Tom Clarke, Mr. David Clelland, Mr. Frank Doran, Mr. Robert Flello, Mr. Fraser Kemp, Shona McIsaac, Mr. Michael Clapham, Ms Dari Taylor, Janet Anderson and Rosemary McKenna, presented a Bill to extend the application of the Transfer of Undertakings (Protection of Employment) Regulations 2006 to the acquisition and disposal of substantial shareholdings by private equity companies; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 7 March, and to be printed [Bill 28].