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The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord McKenzie of Luton): My Lords, I congratulate my noble friend

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Lord Bilston on securing this important debate and thank him for his thoughtful and powerful speech, particularly concerning the importance of work and—in his terminology—the “poverty of the spirit” created by unemployment. I welcome the chance to set out the Government’s impressive record in tackling poverty, because, over the past 11 years and across every measure, we have helped millions out of poverty.

Tackling poverty is at the heart of the Labour mantra and of this Government’s strategy. From Keir Hardie to Clem Attlee and on to Tony Blair and Gordon Brown, the Labour Party has championed the cause of the poor: challenging the notion that poverty is a symptom of birth or breeding; helping everyone to realise their talents; and encouraging social mobility and opportunity for all. As my noble friend Lord Haskel said, this is the cause that called many of us to politics. In order to create a fair and inclusive society and achieve social justice for all, we must—and we will—continue to help the poorest and improve their life chances.

In tackling poverty, we seek to tackle more than material poverty. Poverty brings with it a collection of disadvantages that affect life chances. Poverty can stunt aspirations, with today’s poor children too likely to become tomorrow’s poor adults. It can limit educational chances and restrict health and happiness. Areas of deprivation can foster crime, drug abuse and fear—keeping local communities apart and preventing people feeling safe. Poverty is not acceptable and, under this Government, is not inevitable. In the past decade, we have made great strides forward. We have a solid platform to build on, but there is more to do.

I say in particular to the noble Lord, Lord Skelmersdale, that this is in stark contrast to the previous Tory Administration. Poverty rose dramatically under 18 years of Conservative rule. By 1997, child poverty had doubled. Unemployment during those 18 years reached more than 3 million, and millions of poor pensioners were left to survive on less than £69 a week. Had we simply uprated the tax and benefit system that we inherited, there might have been 1.7 million more children living in poverty than there are today.

We have reversed this record, setting ambitious goals and taking action to reduce and even eradicate poverty. We are taking radical action to eradicate child poverty by 2020, with tax credits and support for parents helping children out of poverty. Employment is up by 3 million since 1997; we have the highest employment in this country’s history. Targeted support has lifted more than 1 million pensioners out of relative poverty and today no pensioner should live on less than £124 a week. For the first time in this country’s history, we can look forward with greater confidence to securing full employment, eradicating child poverty and delivering justice to pensioners.

I pick up the point made by the noble Lord, Lord Skelmersdale—we have heard it before from the Conservatives—about people in severe poverty, defined as 40 per cent of median household income. As he is well aware, the national statistics caveat data on this category. The Child Poverty Action Group has said that the figures are dodgy, as indeed has the IFS. It is not a sensible base on which to measure poverty.

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Over a decade ago, the UK had the highest child poverty rate in the industrialised world. More than one in four children lived in poverty. By pledging to eradicate child poverty by 2020, we have set one of the most ambitious policy objectives of any Government in the world. So far, we have lifted 600,000 children out of poverty, and we remain committed to the target of halving child poverty by 2010 on the way to eradicating it by 2020.

Our strategy focuses on four areas: targeting benefits at the poorest; supporting parents into work; ensuring that communities are safe, sustainable places where families can thrive; and improving the life chances of poor children. Tax credits currently benefit 6 million families and 10 million children. Since 1997, we have invested more than £21 billion in child care services, and this year the Chancellor announced an extra £950 million to tackle child poverty. These are all measures that have helped to reduce child poverty and they show that even in today’s tight fiscal environment, eliminating child poverty remains our priority. Tackling child poverty is not an easy task, but it is the right thing to do. It is a moral imperative that we break the intergenerational cycles that see children born poor and grow up poor, and then see their own children denied the chance to fulfil their potential.

We know that work is the best route out of poverty, and the Government are committed to supporting people in finding work, staying in work and progressing so that they can build a sustainable future for themselves and their families. It is important that we remain committed to this if we are to meet the aspiration of 80 per cent employment, to which my noble friend Lord Bilston referred. As he said, today more people are in work than ever before—29.5 million from the latest figures. That is up 456,000 over the past year and is the second highest employment rate in the G7.

The claimant unemployment rate of 2.5 per cent is the lowest since April 1975. Since 1997, employment is up by nearly 3 million. It is up in every region and every country of the UK; it is up in the neighbourhoods and cities neglected by the party opposite; it is up for disadvantaged groups, with 300,000 more lone parents in work—1 million are now in work for the first time ever—and 900,000 more disabled people in work. There are 1 million more people in work from ethnic minorities and 1.5 million more older workers in work. The number of job vacancies remains at over 670,000.

All that did not happen by chance; it happened because we took the right decisions about the fiscal and monetary framework on which our economic stability is founded and the sometimes painful decision to eschew faster progress in order to secure sustainability in the funding of our public services in the long run. My noble friend Lord Haskel stressed the importance of getting the economy right and embracing globalism, rather than wishing that it would simply go away. It also happened because we put in place active programmes to help individuals to move towards and into the labour market. More than 1.85 million people have been helped into work through the New Deal programmes. Building on their success, the introduction of the flexible New Deal will establish a new unified approach to all jobseekers, whatever their age, skills or barriers

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to work. A key component of this approach will be skills screening and the opportunity for jobseekers to access work-related skills training. In short, there will be flexible, individually tailored support to ensure that no one is left out and no one is written off.

We want disabled people to be able to make the same seamless transition from school to continuing education, training and employment as their non-disabled peers. Work Preparation, Workstep, Access to Work and Pathways are just some of the DWP programmes helping people into work. I saw that at first hand in Norwich just last week. I spoke to a woman who had been out of the job market for 15 years. She had been trapped in her home because of a fear that people with mobile phones were spying on her. With support from one of our third sector providers and funding from Access to Work, she is now in employment. She is gaining promotion in that job and her life is immeasurably better.

These things are happening up and down our country in a quiet and unreported way, day in and day out. Frankly, they would not have happened before this Government came to office. They happened because we are helping to make work pay through the national minimum wage, the working tax credit and the upcoming “better off in work” credit. I acknowledge that we have more to do in helping benefit claimants understand, but under the current tax and benefit system there are very few circumstances in which an individual receives less money from earnings and in-work financial support than they would receive in out-of-work benefits.

Although our record demonstrates that we are the party of opportunity and aspiration for all, we are not complacent. We will continue to ensure that we have an enabling welfare state, one that provides the opportunity to get back into the labour market and contribute to society and the security of an essential safety net for those who have fallen on hard times. Our goal is a welfare state that is a way out of worklessness and a way up the career ladder but not a way of life. We are extending, modernising and personalising the support we offer. However, there is a condition. We do not apologise for it, and I would not characterise it as the noble Lord, Lord Oakeshott, did. In return for providing employment skills and financial support, we expect more of those who can work to look for work and to train for it.

Achieving full employment depends not only on a sound economy and willing and trained employees but on the engagement of employers. Local employment partnerships will ensure that disadvantaged customers get the right training and support so they can stay in work and progress their careers, benefiting themselves and their employers. Through these partnerships we aim to see 250,000 more people in work by 2010.

My noble friend Lord Haskel referred to the work of OneNottingham, which I think is part of the cities strategies. I have had the chance to see some of the enlightened work going on there. We also heard from the right reverend Prelate the Bishop of Liverpool about his experience in local regeneration schemes. We believe that the approach of the cities strategies—which should involve all stakeholders, including the business community, local councils, Jobcentre Plus and others—

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ensures that the community is at the heart of these arrangements. That is crucial to their success.

There has been a reduction of people on incapacity benefit. We are, as the noble Lord is aware, replacing it with the employment and support allowance so that the emphasis is not on what somebody cannot do but on what they can do. That is a very important change. There is increasing recognition that work, good work, is not only the best route out of poverty but good for health and individual self-esteem. Part of the challenge is therefore to secure safe and healthy workplaces to prevent individuals falling out of work in the first place.

The noble Lord went on to talk about the employment and support allowance, which we will soon have the opportunity to debate fully. Again, I would not accept his analysis of the situation. There will be engagement with those in the work-related support group so that they will, we hope, access the labour market before they have been on the benefit a year. For people in the support group for whom that conditionality is not present, they will be either £3.15 a week better off or, for some, £15.75 a week better off in comparison to their position on incapacity benefit. We are expecting to be paying out in total nearly £400 million more in benefits over the next five years of the employment and support allowance compared to the existing incapacity benefit arrangements.

I think I have dealt with the issue of Liverpool and the city strategy. The noble Lord, Lord Skelmersdale, commented on short-term contracts to charities in Brixton. In February 2008 we set out our commissioning strategy for the delivery of employment programmes which will see us moving towards longer contracts and payments tied more closely to outcomes. That seems to me exactly the right thing to do.

The noble Lord asked about the release of the statistics on households below average income. My right honourable friend James Purnell set this out in a Statement a while ago. I think that a small flaw was identified in one of the statistics, which are independent of the Government. That is why further work needs to be done. The hope is that these statistics will now be released in June.

We have not talked much this afternoon about pensioners, as our focus has been mainly on work. However, we are also delivering justice for pensioners, because we want all pensioners to have a decent and secure income in retirement and to share fairly in the rising prosperity of the country. Since 1997, pensioner incomes have risen across the board, with the poorest benefiting the most. Today, for the first time in a period of sustained economic growth, pensioners are less likely to be living in poverty than the population as a whole. We have focused help on the poorest pensioners and the poorest third are £2,100 a year better off. As a result, pensioner poverty has reduced by over a third since 1997, which means more than a million fewer pensioners living in poverty.

The key to that has been the introduction of pension credit, one of the most radical changes to income-related benefits for older people in 50 years. It ensures that no pensioner need live on less than £124 a week and it supports pensioners with savings, second pensions

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and earnings. Maximising take-up is crucial to tackling poverty levels, which is why we have simplified the claims process, although more needs to be done to ensure that that benefit is fully accessed by those who are entitled to it.

We should not forget free TV licences for the over-75s, free off-peak bus travel, free sight tests and the winter fuel payment. We recognise that rising fuel prices, driven by rising world demand, can have a disproportionate impact on older people, which is why this year the Chancellor announced that older people would receive an extra one-off payment to sit alongside the winter fuel payment. Households with someone over 60 will receive an extra £50 and those with someone over 80 will receive an extra £100. This significant extra support will help more than 8.5 million households or nearly 12 million people. It will ensure that the winter fuel payment continues to provide a significant contribution to winter fuel bills.

Our support is not only through this payment. Energy efficiency programmes, including Warm Front, target fuel-poor households in need of loft or cavity wall insulation, helping to reduce their fuel bills as well as generating carbon savings. Moreover, we have worked with energy suppliers on voluntary agreements, which will mean that the total assistance offered to vulnerable households increases to £150 million a year by 2011.

We are making the biggest reforms in UK pensions in 100 years. For the pensioners of tomorrow, we are reforming the state pension and, in private pensions, our reforms will ensure that everyone can save for a better retirement. These changes will create equality for women and carers in state pension provision within half a generation. We will re-establish the link between the basic state pension and earnings during the next Parliament; our objective is to do it in 2012. We have already reformed SERPS, now S2P, which significantly improves coverage for lower-paid workers and people with parenting and caring responsibilities, typically women. Currently around 2.1 million carers, more than 90 per cent of whom are women, and around 6.1 million low earners, almost 60 per cent of whom are women, are accruing entitlement to S2P. Around 1 million more people will accrue S2P from 2010, approximately 90 per cent of whom will be women. We will pay for this by gradually increasing the state pension age to 68 by 2046.

Private pensions will give all workers the opportunity to save in a pension, encouraged by auto-enrolment by employers. By 2015, this will see up to 9 million people saving more or for the first time and around £10 billion more being saved in pensions.

The past decade has witnessed rising numbers of people in jobs and rising prosperity across the whole of the UK.

Lord Oakeshott of Seagrove Bay: My Lords, before the noble Lord sits down, perhaps he could deal with the main thrust of my remarks—which I do not think he did—which was that the most deprived regions and constituencies have not shared fairly in the growing prosperity that we all accept has occurred in this

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country over the past 11 years. If he does not have time to do that now, will he undertake to look into it and write to me?

Lord McKenzie of Luton: My Lords, I am very happy to write to the noble Lord on that, but employment has increased not only right across the country, but in every region and every country in the UK. The noble Lord shakes his head. I will write to him just to reinforce that.

We have achieved a lot, but we know that there is still more to do. The Government's policies are about championing social justice and defeating inequality. We will continue to increase support for those most in need, to help people into work and to improve life chances. We want to ensure that poverty is not a way of life, so that we can continue to build a society based on fairness and on opportunity.

Lord Skelmersdale: My Lords, before the noble Lord finally sits down, he was good enough to agree with me about the number of children whom the Government have lifted out of poverty. He gave the figure of 600,000—exactly as I did. As I pointed out, yesterday at Prime Minister's Questions, the Prime Minister said that the Government have,

I checked that in the House of Commons Hansard this morning. Clearly, the noble Lord will not have an answer now, but I should be very grateful if he would write to me to tell me how he rationalises those two statements.

Lord McKenzie of Luton: My Lords, I was probably doing my preparation for Report of the Child Maintenance and Other Payments Bill when Prime Minister's Question Time was on yesterday, but I will certainly look into the matter and ensure that the noble Lord gets a note on it.

4.31 pm

Lord Bilston: My Lords, I express my sincere thanks to all the participants in this very important debate. I thank my noble friend because he has confirmed, as I said in my speech, my faith and support for our Government and what they have achieved in tackling the major issues of poverty and improving our society in the way that they have in the past 11 years. I thank him for enumerating all those wonderful policies that are reaching out to the people whom we seek to be uplifted from the poverty and deprivation that they face.

To the noble Lords, Lord Oakeshott and Lord Skelmersdale, I say that further evidence is here in this debate that we are all committed to the elimination of poverty, to the social justice that flows from it, to the need for this society of ours to create the conditions where people are—as I said in my speech—more equal and wealth is more equally shared.

We should continue to debate these issues, because it is work in progress. No party can claim that it has

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reached the success that we want to reach for those millions of people in poverty.

I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

Health: Allergy (Science and Technology Committee Report)

4.34 pm

Baroness Finlay of Llandaff rose to move to move, That this House takes note of the report of the Science and Technology Committee on allergy (6th Report, Session 2006-07, HL Paper 166).

The noble Baroness said: My Lords, it has been a great privilege to chair the committee and to introduce the debate today. The members of the committee who conducted this inquiry were notable for their enthusiasm and commitment to the subject. I know that they would wish to join me in expressing our great gratitude to our hard-working Clerk, Sarah Jones, and our wise specialist adviser, Professor Barry Kay, as well as to all who gave evidence to us, informed our seminars or hosted our visits in the UK and abroad.

The report and its recommendations have been warmly received in the allergy community by professionals and patients alike and extensively covered in the media. Several authoritative reviews of clinical allergy services preceded our report, and all of them noted serious deficiencies. Against this backdrop, we set out to look at the wider social and economic implications of allergy. Yet as the inquiry developed, it became shockingly apparent just how severely allergic diseases could impair people’s quality of life and how, despite our track record of high-quality research in the field, allergy services in the UK lag far behind those of other European countries through a severe shortage of allergy specialists.

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