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Mr. Walker:
That is an important point. I think that it is incumbent on primary care trusts and regional health authorities to consider how hospitals as well as
local government can play their part in the funding of such schemes. Our local authority, Broxbourne, provides a subsidised bus service to help people to travel to hospitals to visit friends and relatives. I should like such services to be provided in a more joined-up way, rather than just being provided by local authorities with a bit of spare cash. If the Government could give a lead, that would be a step in the right direction.
We have heard a great deal about access to benefits. I know that the Government are keen to ensure that pensioners receive the benefits to which they are entitled, and the Conservatives are as well, but the truth is that that is not happening. I do not think any of us can afford to rest on our laurels until the rate of benefit take-up by pensioners is nearly 100 per cent. Those benefits can make a real difference.
If we are to deal with many of the cost issues faced by pensioners, we must either increase their incomes or reduce their costs. There are a number of ways in which we could do either. First, we should consider the cost of energy production, in which the Government have a part to play. Oil still forms a fundamental part of the energy burned by our power stations. We must find ways of reducing the cost of energy, which would have an immediate impact on pensioners, and we must encourage energy providers to subsidise the services that they deliver to pensioners. Such subsidies need not continue indefinitely, but at a time when energy prices are high and fuel bills are rising by 20 or 30 per cent. a year, the situation requires urgent attention.
Many pensioners who could be described as middle-income earners have scrimped and saved throughout their lives to build a future for themselves. Their earnings may have been similar to those of people living opposite, but instead of buying new cars and taking holidays, they bought their homes and made provision for their old age. Too often when such people go into residential care, there is a price to pay in the form of confiscation of their assets. I do not have an immediate answer to the problem, but we need to address that element of unfairness in the system.
Pensioners are slow to anger. They are wise people who have lived long lives and have seen it all before, and they like to take a long-term view of big issues. They do not jump up and down like younger people such as me, getting frightfully agitated. However, pensioners are now becoming worried and angry. On 22 October there is to be a lobby of the House by a pensioners’ pressure group, and between now and then we need to make some progress in alleviating the immediate problem faced by pensioners: the increasing cost of day-to-day living. I know that the Government have taken the message on board, I know that we have taken it on board, and I hope that we can work collectively to ensure that that happens.
6.29 pm
Mike Penning (Hemel Hempstead) (Con): It is a pleasure to follow my hon. Friend the Member for Broxbourne (Mr. Walker). We have come to expect a passionate speech from him, and we heard another one this evening.
I am pleased to see that the Minister has returned to the Chamber, because I want to address some of the points that he made in his speech. I shall also try to
persuade him to deal with the question that I asked him in an intervention earlier. If he does not manage to do so on this occasion, perhaps he will write to me.
In his opening remarks, the Minister said what a wonderful situation the country is in at the moment. He said that there were no marches or demonstrations and that everything out there is rosy for our pensioners and other constituents. I am not certain what world he lives in, but that certainly is not the case in my constituency, and I draw his attention to some recent demonstrations. Pensioners have joined me to demonstrate against the school closures in my constituency that the Government are, sadly, pushing through. The Government will not listen to the local pressure groups that have asked them not to close those schools now, while we are short of numbers, because they are imposing 18,000 homes on us, whether we want them or not, and children will be coming through.
The Minister could have joined me on the picket line at my local fire station, which has recently been closed because of financial problems. It is not the first time that I have been on a picket line at a fire station, as I used to be a member of the Fire Brigades Union.
David Taylor: On a point of order, Madam Deputy Speaker. I wonder whether we could consider what is being said, because fire station closures and school closures do not seem immediately to be linked to the topic of debate.
Madam Deputy Speaker: Order. I think that is for me to decide. I was allowing the hon. Gentleman some leeway in the hope that he would soon address his remarks to the motion on the Order Paper.
Mike Penning: Thank you, Madam Deputy Speaker. I was addressing the comments that the Minister made in his opening remarks. If the hon. Member for North-West Leicestershire (David Taylor) had been in the Chamber at that time, he would have known that and would not be wasting the Chamber’s time now.
If the Minister thinks that no demonstrations are taking place and that pensioners are not concerned, he should join the hundreds of thousands of people around the country who are demonstrating against hospital closures, not least the 30-odd thousand who have signed a petition in my constituency. He mentioned that there is no bed blocking, but the reason why there is not much bed blocking in my constituency is that the wards are closing. Many care homes are also closing, and that is causing even more problems for hospitals in other areas that are trying to bring patients back to my constituency, because there is nowhere for them to go.
The Minister said that things are better today than they were 11 years ago. At that time, I was in a union that is no longer affiliated to the Labour party, and we made contributions to the Labour party—I must admit that I had my donations removed—in the hope that it would address the issues that it had talked about so much when it was in opposition for so long, but that has not happened. The figures that we have heard today are frightening—not least those given by the
hon. Member for Cardiff, Central (Jenny Willott)—and show the many problems of so many pensioners who are still in poverty.
Let me draw the Minister’s attention to one of the biggest demonstrations by pensioners in this country. The hon. Member for Cardiff, Central has joined me on many demonstrations, at which, to draw attention to the plight of the 140,000 pensioners whose pensions were stolen from them, many middle-aged men who had never demonstrated in their life took off most of their clothes just to get some publicity and to get the Government to listen to their plight.
The Minister proudly said that he has addressed that issue and that the Government have come forward with a package for those pensioners, who will get 90 per cent. of what they would have got, but I find that slightly difficult. I know the Minister well and I know that he has tried hard, but that has taken five years of promises, meetings, more meetings and demonstrations by people who had done the honourable thing. I have made this speech many times before in the House, and I know that the Minister agrees that they are honourable people who did the right thing. They worked hard and did not spend their money on holidays in lavish places, but put it into a pension scheme that Governments had said was safe.
This Government were taken to the parliamentary ombudsman on this matter, who found that they were in breach and that there had been maladministration. That is a fact that even the Minister cannot deny. He might disagree with the conclusions that were reached, but that is what the independent ombudsman found. The Government challenged the finding and said that they would not pay the compensation that the pensioners deserved and went to court, where they lost again. They went to the European Court, but they lost again, although they kept saying that they would not. They challenged the ruling in the courts.
For the Minister to stand here and say what a wonderful job the Government have done in compensating those pensioners five years later sticks in my throat slightly, because I know that although he has done his bit, his predecessors have been misleading, frankly, in many ways, regarding the promises that were made. I do not know why the Government did not listen to the parliamentary ombudsman at the time. That is exactly what previous Governments had done; they had adhered to the parliamentary ombudsman’s report, come up with a compensation package and paid the compensation.
One of the great problems—I know that the Minister knows this to be a fact—is that, because this has taken five years, a lot of these pensioners will now get a lump sum, which will put them into a completely different tax bracket from the one that would have applied if they had been given their pension, to which they had a right, five years ago. It cannot be right for the Government to bring forward a compensation package that will force pensioners to pay more tax than they would have done if they had had their pension by right. Earlier on, the Minister said that this was a matter for the pensioners to take up with the taxman, but it is not; it is a matter for the Government to sort out. It is not the pensioners’ fault that they did not get their pensions. It was owing to this Government’s maladministration—that is the parliamentary ombudsman’s word, not mine—that they failed to get their pensions.
Two groups of people are really suffering, at both ends of the spectrum, in relation to income tax. There are those who will receive a lump sum and will have to pay 40 per cent. of it, which they would not have had to pay if they had had their compensation earlier. Another group—a smaller group, I admit—comprises those who are the most needy and who would have paid only 10p in the pound before the Government abolished the 10p tax rate. Surely it cannot be right for any Government—let alone this Government, who have promised to compensate the people who have lost out—to do that. If the 10p rate had still been in place, and if those people had been given the pension that they deserved, they would not have to pay the 20p in the pound that they will now be asked to pay. I have not seen any compensation package that will protect those people.
Anne Main (St. Albans) (Con): I thank my hon. Friend for giving way. He and I share the same group of pensioners who have been affected by the Dexion pension collapse. He has put forward a cogent argument in relation to the package that has now been put in place, but that package will not compensate for the stress and worry that people went through, and the life-altering changes that they had to make during that time, when they did not know how much money they would be able to spend or what debts they might incur. On top of all that life-altering stress and change, it seems doubly unfair to tax them at a higher rate. The Government really should show a bit more compassion over this.
Mike Penning: I thank my hon. Friend for that intervention and pay tribute to the work that she has done on behalf of her constituents on this issue.
As the Minister knows, some of those pensioners did not live to see the end of the process, and there are widows out there who are suffering as well. They will now fall into the higher tax bracket. Some of them have had to go to work because they had no income from the pension that they had paid into. They have already paid tax on the income that they earned, and now they will be asked to pay tax on top of that, which will take them into the 40 per cent. tax bracket.
However, the particular people for whom everyone in the House should feel sorry, and for whom the Government must do something, are those who would have paid only 10p in the pound before, and who are now going to have to pay 20p. They are the most vulnerable pensioners—in my constituency, they worked for Dexion—who earned the lowest amount, but they are now going to be hammered. That is not compensation; that is vindictiveness.
6.38 pm
Andrew Selous (South-West Bedfordshire) (Con):
We have had an important debate tonight, which was comprehensively and persuasively introduced by my hon. Friend the Member for Eastbourne (Mr. Waterson). The debate on pensioner poverty was initiated by the Conservative party because it is such an important issue. Let me begin by welcoming the hon. Member for Cardiff, Central (Jenny Willott) to her new responsibilities. Among other things, she said that only 57 per cent. of people were taking up council tax benefit, and that the
take-up rates for council tax benefit and housing benefit were actually lower than under the previous Conservative Government. She was wrong, however, to say that my party would not restore the earnings link; we will be doing that.
The right hon. Member for Manchester, Gorton (Sir Gerald Kaufman) paid kind compliments to my hon. Friend the Member for Eastbourne—I gather that they shared an English teacher at some time in the past. The right hon. Gentleman also said that the issue of bed blocking had been solved, but listening to the experiences of hon. Members on both sides of the House, it seems that that is not the case.
My hon. Friend the Member for Braintree (Mr. Newmark) spoke movingly about the position of pensioners in his semi-rural constituency, as he described it. He made the very valid point that inflation for the elderly is higher than it is for the rest of the population and reminded the House of the Government’s failure to repeat the £200 council tax reduction in 2006. As he told us, Help the Aged described that as a cynical election bribe.
The hon. Member for Morecambe and Lunesdale (Geraldine Smith) talked about pensioners dying under the previous Conservative Government, but I did not detect any reference to or sorrow about the fact that there were 22,300 unnecessary winter deaths of older people last year. That needs to go on the record.
My hon. Friend the Member for Weston-super-Mare (John Penrose) made his customarily reasonable and measured speech, for which he is well respected on all sides of the House. He talked of the need for proper and fundamental reform of our pensions system. I was delighted to hear what he said about the need to get rid of age discrimination. Future generations will look back with incredulity at the way in which we treat people above pensionable age who want to work. The sooner we get rid of that form of discrimination, the better.
My hon. Friend the Member for Broxbourne (Mr. Walker), a diligent attendee in the Chamber, called rightly for more freedom for local authorities to spend their money as they see fit in relation to their older residents. He also referred to the confiscation of assets of people going in for long-term care. We had an excellent policy on that at the last general election, which no doubt persuaded many pensioners in his constituency to vote for my hon. Friend.
My hon. Friend the Member for Hemel Hempstead (Mike Penning) mentioned, quite rightly, his Dexion pensioners. I pay tribute to the tenacity that my hon. Friend has shown over years on behalf of those pensioners, some of whom are in my constituency. He reminded the Minister of the protest marches going on up and down the country at the moment against various aspects of Government policy. Marches are taking place in Hemel Hempstead and elsewhere. The Minister said he was not aware of such marches but he has been made aware of them now.
I was struck by the interventions by my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), who pointed out that rural pensioners—those living in market towns and villages up and down the country—are paying higher council tax and often receiving worse services. He also made the important point—one that I
made in a previous intervention on the Prime Minister—that those council taxes are higher because local authorities are having to put more money into the pension schemes for their staff because of the Government’s £5 billion a year tax raid on occupational pension funds. We do not hear enough about that.
I was pleased to hear mention of heating oil from the hon. Member for Somerton and Frome (Mr. Heath). I heard a recent story about shepherds in Scotland whose bill for filling their oil tank is more than their monthly wage; they have to have their oil paid for by their employers, who they then pay back on a monthly basis.
The Minister’s approach seemed to be to go back and knock what happened under the last Conservative Government—a sign of a Government who are backward-looking rather than focused on preventing future pensioner poverty. Instead of attacking what took place 11 years ago, they should be more focused on ensuring that the nearly £5 billion of unclaimed benefits today actually gets to the pensioners who desperately need those benefits, 500,000 of whom would be lifted out of poverty if those benefits were paid out, according to the Institute for Fiscal Studies.
The Conservative party has supported the Turner pension reform proposals as a sound basis for a future pensions settlement and we are pleased that at last the Government are taking seriously the concerns we have raised about those people who would be better advised not to enrol in the new personal accounts scheme because of their loss of means-tested benefits. But these vital pension reforms to state pensions and personal accounts do not come in until 2010 and 2012 respectively. That is 13 to 15 years after the Government entered office, pledging that all pensioners should share fairly in the increasing prosperity of the nation. That means that a large proportion of the working-age population will be poorer than they need to be in retirement, as the Government will have taken 15 years to put a decent pension settlement in place when they would have had the support of the Conservative party to do that on day one. Rather than hearing self-satisfied complacency from the Government about what they have done, it would be good to have a general recognition across the House of the scale of the problem.
Figures produced by EUROSTAT on 28 March show that out of 29 European countries, the United Kingdom is the fourth worst in which to be a pensioner. Only Cyprus, Spain and Latvia have a greater proportion of their pensioners living in poverty, using 60 per cent. of median equivalised income after social transfers—
Mr. Mike O'Brien indicated dissent.
Andrew Selous: The Minister shakes his head, but he should look at the note on the EUROSTAT figures. This Government have a tendency not to like any figures that they have not produced; they do not like the UN figures, the OECD figures or the EUROSTAT figures.
Andrew Selous: I do not have long left, and I am going to respond to the hon. Members who have spoken in the debate.
The figures also show that the proportion of pensioners living in poverty in the UK increased between 1997 and 2006, while the proportion of over-65s living in poverty in Greece, Portugal, France, Austria and Luxembourg fell. So, I hope that we will hear some sober reflection from the Minister on what more can be done, within the constraints of pretty battered public finances, to help today’s pensioners, who are struggling with massively high gas, electricity and oil bills, as well as much higher food prices, increased council tax and the loss of the 10p tax band.
One of my pensioner constituents wrote to me last month, and the Ministers might like to listen to what he said:
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