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Sir Gerald Kaufman:
I am glad that the hon. Gentleman accurately expects a Labour Government to be in office in 2015, as they will be, with me as a Back Bencher to support them. He will remember that when we were elected in 1997, we made a commitment to abide by spending and taxation levels as an act of fiscal responsibility. Of course I would like the link to be restored sooner—I will campaign for that—but let us be clear that it is no good for him to be moaning and
wailing about our not putting right as quickly as some people would like something that the Conservatives put wrong deliberately.
When the Government introduced winter fuel payments in November 1997, the Conservative party derided the payments. It said that they were a gimmick and implied that it would get rid of them. It was only when it turned out that winter fuel payments were popular and helpful for pensioners that the Conservative party backtracked. When Conservative Members talk about the value of winter fuel payments and about poverty for pensioners, they must take account of the fact that they are complaining that something initiated by a Labour Government should be improved still further. That is quite true, but let us not forget that without a Labour Government, there would not have been winter fuel payments. I can tell the hon. Gentleman that pensioners know that.
The hon. Gentleman complained about the take-up and availability of the Warm Front scheme. Constituents write to me, as no doubt they write to him, about their wish to be involved in the scheme, but who created the scheme? The Labour Government did so in 2000. The scheme never existed under a Conservative Government. For Conservative Members to say that there is not enough take-up of the scheme is for them to admit that the scheme is valuable, which makes one wonder why the Conservative party never introduced it. When constituents ask me to do so, I visit them in their homes to discuss issues if they are not well enough or mobile enough to come and see me at my constituency surgery. When the Conservatives were in government, in winter constituents would ask me to visit in the early afternoon, because as soon as it got dark they would go to bed, as they could not afford to heat their houses. They lived in misery.
The Liberal Democrat party seems to believe that the issue is simply about reeling out a succession of statistics. The issue of pensioner poverty is of course to do with money, but in the end it is a human problem. As hon. Members have said, pensioners are living longer and longer because of the creation of the welfare state and because of the way in which health services assist pensioners. That involves the possibility of pensioners living alone and having to spend time alone. If their relatives do not live near them, they have the problem of loneliness, and the problem of participation in the general life of the community. That is a very important point. There is absolutely no doubt that money is very important for pensioners, but they also need the possibility of company. They need drop-in centres and the availability of all kinds of other facilities to make them feel that they are not on their own and are part of a community.
I do not for a moment say that the Government have solved the problem of poverty among pensioners. Of course they have not, and I very much doubt whether any Government will totally solve it, because there are more and more pensioners the whole time. The hon. Member for Cardiff, Central mentioned the number of people who were helped as a result of the creation of the old-age pension by Lloyd George. There are now 11 million people of pensionable age—a huge proportion of the population. Their need for the public services created by the state grows and grows.
From time to time, I discuss with the chief executive of the Central Manchester and Manchester Children’s University Hospital NHS Trust the issues that he has to deal with, and one of them is the fact that because pensioners are living longer and longer—that is a good thing, of course—they contract illnesses that they would not otherwise have lived to contract. Of course they require the services of the NHS. They require hospital space.
One of the problems that we did solve—my right hon. Friend the Member for Holborn and St. Pancras (Frank Dobson) solved it when we came to office in 1997—was bed blocking, and the fact that pensioners could not be discharged from hospital because there were no carers to look after them. At the time, there were no spaces in care homes, which the Conservatives had privatised. We solved that problem, but the fact is that pensioners will draw disproportionately on the services of the NHS because it is in the nature of ageing that they will contract all kinds of ailments that they would previously never have lived to contract.
What have we done on the issue? In his impressive account of the Government’s record, my hon. and learned Friend the Minister for Pensions Reform mentioned that 3 million old-age pensioner households have been lifted out of poverty since 1997, that the basic state pension has risen above inflation every year since 2000, and that 3.3 million senior citizens receive pension credit. This very April we introduced free local bus travel for every pensioner as a right throughout the United Kingdom. The ability to travel and see family members is extremely important to counteract pensioner loneliness. We did that.
John Penrose (Weston-super-Mare) (Con): On the point about pension credit, does the right hon. Gentleman encounter the same problem as I do in my surgeries, where pensioners come in and complain about the endless bureaucracy involved in claiming it successfully? Is he aware that the pension credit application form is 17 pages long, with 18 pages of explanatory notes? Does he agree that simplifying the design of both the pension credit and the form would dramatically improve take-up and therefore reduce pensioner poverty significantly?
Sir Gerald Kaufman: The hon. Gentleman is probably right, and I agree that complicated forms are awkward not only for pensioners, but for all members of society who have to fill them in. I acknowledge that, and I hope that my hon. and learned Friend the Minister is working, as he indicated he was, to improve the situation. The hon. Gentleman makes a valid point, but the credit exists only because the Labour Government created it.
I accept that there are problems, which is why there is not 100 per cent. take-up, but the Government deserve congratulation for having created the pension credit, just as we created the winter fuel payment; 11.7 million pensioners in 8.6 million households are benefiting from winter fuel payments. One of the merits of that, which goes back to the intervention of the hon. Member for Weston-super-Mare (John Penrose), is that pensioners do not have to fill in a single form in order to claim the benefit. It comes through the post
automatically. That is very good indeed. Without the Labour Government, there would never have been a winter fuel payment.
The hon. Member for Eastbourne spoke about Warm Front. There are grants of up to £4,000 to insulate homes. With reference to the television licence, I wish—I campaigned on this in the past—the Government felt able financially to provide free television licences to all pensioners. As everybody will acknowledge, the cost is substantial, but 3.3 million pensioner households are benefiting from the free TV licences for those aged 75 and over. The Government have introduced free passports for 4.5 million senior citizens aged 75 and over. They have restored free eye tests to 6.6 million pensioners. All those are achievements by the Labour Government.
I regard as one of the Government’s most dazzling achievements the fact that there are now free flu inoculations for all 11 million pensioners every year as winter approaches. I am just slightly over the age at which one qualifies for the flu inoculation. What I find interesting is that the health centre at which I am registered sends me a letter asking me to apply for a date and a time when I can go for my flu inoculation. When that is fixed, I go there and I am given the inoculation without a wait at the precise time that has been arranged. I regard that as a dazzling act of efficiency that the Government have been able to achieve. Anybody who has used the national health service—I certainly have, and I am sure that every other hon. Member has—must be impressed by the dedication of its staff. In just over a month, on 5 July, we celebrate the 60th anniversary of the national health service. The Conservative party, in this House of Commons, voted against the creation of the service, which now provides such benefits to pensioners.
We will never be able to do enough for pensioners. Individually, as families and through pressure groups, pensioners are right to press Members of Parliament and the Government to do more for them the whole time. I will always join in on that, because our pensioners have gone through two wars and have worked hard for this country. They deserve dignity and comfort in retirement. Yes—let us go on pushing and pressing, regularly and frequently, for improvements in the situation of pensioners. But I will take no lectures from the Conservative party, whose record on the issue is appalling. The record of this Government, however, is one of which I am proud.
Madam Deputy Speaker: I call Brooks Newmark.
Mr. Charles Walker (Broxbourne) (Con): Hurrah!
5.50 pm
Mr. Brooks Newmark (Braintree) (Con): Thank you, Madam Deputy Speaker; I assume that my hon. Friend the Member for Broxbourne (Mr. Walker) is cheering because he is looking forward to what I have to say on this important subject.
We all have to cope with a rising cost of living and a record burden of tax from a Government who have clearly run out of money. However, we should regard the fact that that burden falls disproportionately on pensioners—some of the most vulnerable people in our society—as a disgrace. The real cost of living is increasing steadily, and that is all the more apparent for
pensioners living on low or fixed incomes. Recent research highlights the fact that inflation for the elderly is more than a third higher than the official consumer prices index rate, at 3.4 per cent. As we have heard today, the elderly spend a higher proportion of their income on the bare necessities and less on consumer goods.
However, the numbers themselves do not tell the whole story of pensioners in my semi-rural constituency; they are struggling to run a car, and struggling with rising energy bills and the rising cost of a pint of milk and a loaf of bread. I want to focus on just two themes: fuel poverty and the Government’s addiction to the means-testing of pensioners.
Rising energy costs are inconvenient to almost everybody, but they are potentially deadly to pensioners. Earlier this year, I wrote to the chief executive of EDF Energy, which supplies many of my constituents in Braintree and Witham, to ask what steps the company was taking to lighten the load of fuel poverty, which is falling on vulnerable people, particularly pensioners. The response that I received drew my attention to EDF’s very welcome social tariff, which offers a 15 per cent. discount on energy bills for those in receipt of income support or pension credit or who are recognised as living in fuel poverty because they spend more than 10 per cent. of their annual income on energy. Nevertheless, a percentage discount of that kind becomes less and less relevant as the underlying cost continues to spiral upwards. The scheme will need to be kept under review, particularly as some energy suppliers have raised their tariffs by more than 15 per cent. already this year and average fuel bills have risen by 60 per cent. in the past four years.
I have two further observations, applicable to both the private sector and the Government in their respective responses to pensioner poverty, the first of which is short-termism. EDF, for instance, confirmed that its scheme is guaranteed to continue until March of next year, but not beyond. Similarly, the Government have shown time and again that they also favour short-term solutions to pensioner poverty; this year’s Budget offered another one-off payment for pensioners, who would rather have a sustainable income. I have previously addressed this issue at some length with the Prime Minister. When the Treasury Committee considered the 2006 Budget, I reminded the right hon. Gentleman of Help the Aged’s view of the failure to repeat a £200 council tax rebate for pensioners:
“The Government issued a pre-election bribe last year but they have not renewed it for 2006. This exposes a shameful level of political expediency”.
When I asked the Prime Minister what had changed since the general election, he said:
“What has changed is we said in the last Budget that this was for the year and we made no commitment for it beyond that.”
Unfortunately, this culture of Government living from year to year, devoid of long-term planning, does little to help the vulnerable pensioners who are living from hand to mouth day by day.
John Penrose:
Does my hon. Friend agree that one of the causes of today’s short-termism is almost certainly the Government’s tight financial circumstances? We have already seen, with the 10p tax U-turn and with Northern Rock, the pressure that has been created on the Government’s three financial tests. They had no
headroom to make such short-term measures become sustainable longer-term measures. The reason for their short-term thinking is the financial pressures that they have landed themselves in.
Mr. Newmark: My hon. Friend makes an excellent point. This is happening across the board throughout all public services. The pre-Budget report and the Budget showed that the Government are having to make cut after cut, and the people paying the price are the vulnerable—the poorest in our society, particularly pensioners.
We have seen all too recently what happens to a Government fearing annihilation in local elections and by-elections—they feel free to make costly electoral bribes with taxpayers’ money. Unfortunately, we have also seen the doubling of council tax over the past decade, met with rebates that then vanish after the electoral dust has settled. Now there is an additional one-off winter fuel payment of £100 for 2008-09. There has also been an increase in personal allowances partially to compensate those who lost out from the doubling of the 10p rate, which, again, will vanish when the year is up. The common theme in all the Government’s disingenuous ingenuity is the short time horizon for additional support offered to the elderly and the vulnerable. This is not a helpful approach for those who are on low and fixed incomes and whose savings have been systematically eroded by the Government’s ever-increasing dependence on means-testing.
My second observation concerns the challenge of increasing uptake. A total of 55,000 people are currently on EDF Energy’s reduced social tariff, although the chief executive was unable to tell me how many of them fell within my constituency. I am glad that the private sector is taking action, and I hope that more will be done to promote uptake amongst pensioners and other vulnerable people. Yet the Government’s response to pensioner fuel poverty has been an expensive awareness campaign through Citizens Advice that is unlikely to reach the most vulnerable pensioners who do not take the initiative to seek such advice. On the DWP’s own figures, between 1.1 million and 1.7 million pensioners are not claiming the help that they are entitled to, and the Department even admits that the numbers responding to its campaigns to increase uptake are steadily decreasing over time.
More worrying still is the proposal for even more invasive data sharing between the Government and the energy companies—a point eloquently made earlier in the week by my hon. Friend the Member for Rutland and Melton (Alan Duncan). If a major energy supplier such as EDF does not hold data that can tell me how many people in my constituency—or in Braintree district, if that is easier for it—already make use of its own scheme, I have little confidence in entrusting it with the personal data of millions of vulnerable pensioners.
The elephant in the room concerning uptake remains the Government’s utter failure to address their reliance on the principle of means-testing pensioners. The first question that I ever asked the former Prime Minister, in response to the concerns of the Braintree Pensioners Action Group, addressed that very point and it is
something that I have since followed up with his successor. The current Prime Minister has told me:
“Our aim is to link tax and benefits for pensioners in a way that there is a seamless transition through the benefit and tax system.”
But outside his own parallel universe, the interaction of the tax and benefit systems has so many burst seams that the stuffing is falling out completely. The Government are still trying to compensate for the heavier tax burden and higher costs of living facing pensioners by relying on one-off bribes and means-tested benefits that pensioners find complicated and inaccessible. As many hon. Members do, I routinely see pensioners who qualify for means-tested benefits but do not understand their entitlement, even if they happen to receive it, because they are forced to plough through page after page of abstruse computer-generated calculations. I believe that my hon. Friend the Member for Weston-super-Mare (John Penrose) made that point.
The Prime Minister has also told me that the complexity does not matter so much because:
“What we have reduced is the amount of means-testing that is done for pensioners.”
Bah, humbug! But there are still 3.74 million people over the age of 60 in receipt of means-tested benefits and many more who are entitled to claim but do not do so. Help the Aged identifies a staggering sum of up to £4.5 billion that lies unclaimed each year. Furthermore, half of those pensioners entitled to council tax benefit do not claim it. Once again, there is a disconnect between the Prime Minister’s rhetoric on means-testing and the reality of stagnating uptake, a declining savings culture and an ongoing failure to reach those pensioners who are most in need of additional support.
As the Government move to the introduction of personal accounts, the reliance on means-tested benefits will pose new problems for a new generation of savers looking towards their retirement. The Government must face up to the need to grasp the means-testing nettle so that people feel confident about saving for the future. The message must be that taking personal responsibility along with a personal account is the right thing for pensioners, and we will not leave them worse off. The Opposition motion is right to call on the Government to deliver on one promise from 1997, but they must also deliver on another: the end of means-testing for the elderly.
6.2 pm
Geraldine Smith (Morecambe and Lunesdale) (Lab): I had not intended to speak today. I intended just to come into the Chamber to hear what the Conservatives were going to say about pensioner poverty. I thought that they would be embarrassed and shamefaced when we looked back at the appalling record of the previous Conservative Government on pensioners and pensioner poverty. In contrast, the present Government’s record is very good. How well we look after the most vulnerable members of society is the mark of a civilised society. This Government have a good record of looking after those vulnerable members, including the poorest pensioners.
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