HC Deb 17 April 1946 vol 421 cc2830-6

Resolution reported: That, for the purposes of any Act of the present Session relating to Finance, it is expedient to authorise—

  1. (a) the issue out of the Consolidated Fund of any sums ascertained and recorded under section seven of the Finance Act, 1941, falling to be credited to a man of sixty-five years or upwards or a woman of sixty years or upwards, in respect of income tax for the year 1941–42, the year 1942–43. or the year 1943–44;
  2. (b) the borrowing of money under the National Loans Act, 1939, for the purpose of providing the sums so issued."

Motion made, and Question proposed, That this House doth agree with the Committee in the said Resolution."

10.30 p.m.

Captain Crookshank

I should have thought, Mr. Speaker, that the Chancellor would have risen—

Mr. Dalton

Does the right hon. and gallant Gentleman wish to know something?

Captain Crookshank

I should have thought the Chancellor would have given some information on this provision. If the Resolution is passed it will mean that postwar credits will be paid to men of 65 and upwards and to women of 60 and upwards, as he told us in his Budget speech. I think we might have some explanation of his startling change of attitude on this matter. It is not long ago since we raised this matter, and this is a recognition of the proposals we made from this side of the House on 29th November, and against which hon. Members on the other side voted. My hon. and gallant Friend the Member for West Edinburgh (Lieut.-Commander Hutchison) moved a new Clause on that date for the repayment of postwar credits for persons of ho years on or before the date specified. One point I should like the Chancellor to explain is why he has applied these proposals to men of 65 and women of 6o. Why has he not taken the flat rate we suggested? It is just in order to be awkward, and to be able to tell his supporters "Of course we have not supported the Opposition proposal "? He then goes on to say he will not restrict the payment to old age pensioners, but will accept the eligibility of age only and that this is for reasons of economy of labour. This is a great revolution. It is very far away from what the Chancellor said a few weeks ago, and I suggest that we are entitled to know why he has done this. May I remind the House of a few sentences the right hon. Gentleman used when he argued against the proposition of my hon. and gallant Friend the Member for West Edinburgh who said that the postwar credits should be given to people of 60 and over? The hon. Member for Nelson and Colne (Mr. Silverman) said that the payment should be to old age pensioners on grounds of need. This is what the Chancellor had to say to the proposal, which is almost the same as that which he is producing today: This Clause has been very properly criticised by my right hon. Friend as an indiscriminate proposal regarding all persons over 66. whatever their need, who have a postwar credit. All this does is to pay credits to men over 65 and to women over 60. The right hon. Gentleman went on to say: This is going to put into the first line of priority among others the millionaire over 60. It is therefore quite indefensible. The right hon. Gentleman has no difficulty in saying why he rejected the Conservative proposal to give postwar credits to millionaires over 60. What is he going to say now, for that is exactly what he is proposing to do? He went on to say on the same occasion: I venture to suggest…that we cannot get justice or distribution according to need, which is what believe in, merely by taking an automatic age criterion."—[OFFICIAL REPORT, 29th November, 1945, Vol. 416, c. 1622.] The Resolution authorises payment to men of 65 and women of 60. It is hardly surprising that the right hon. Gentleman did not get up to defend his proposal, and I would like him, if he would be so kind, to explain why he has made this differentiation in age. I feel that he has been prompted to this by the attention we gave to the matter in November last, and the new Clause then proposed from this side of the House, which the right hon. Gentleman and his friends so incontinently and, as it turns out, so unwisely, rejected.

Mr. Dalton

The right hon. and gallant Gentleman has enjoyed himself. He has enjoyed his own retrospective oratory. He is one of the most gifted of our foes. He has done well with his opportunities. Last October, many proposals were made, including a group of proposals concerned with the repayment of postwar credits. All these I resisted; and in my view resisted them rightly at that time. But nothing remains eternally unchanged—well, I hope, nothing; though perhaps the mentality of some of the hon. Gentlemen opposite does. As we move on from stage to stage, things become possible which earlier, even if just possible, would have been most unwise. Last October, when my first Budget was under discussion here, we were at the beginning of a new phase of our national and economic life. We were seeking to repair the ravages of war, we were seeking to get production moving again; we were accelerating the release of men from the Forces; and at that time it was necessary to be exceedingly cautious in the granting of any concession which might have the effect of expanding purchasing power in advance of expanding production. Therefore, I had at that time, to present a firm, reasoned resistance to this proposal, which was most ardently pressed not only, and not most, I think, from the other side of the House, but equally from this side of the House. My hon. Friend, the Member for Nelson and Colne (Mr. S. Silverman) was much more passionate about this than the right hon. and gallant Gentlemen opposite. It is true that they were temporarily allied in argument, but the difference between them was that the hon. Member for Nelson and Collie had a greater sense of the importance of timing this concession. The right hon. and gallant Gentlemen opposite disregarded the momentary difficulties that were confronting us at the conclusion of the war, whereas my hon. friends were convinced, by the argument I employed at that time, that while I could not give way, I could give them hope that it might be possible before long. The time has come now. I hope that the right hon. Gentleman will be consistent with the view he took last November and will not oppose what I am offering today —safely and prudently offering. [An HON. MEMBER: "Offering to the millionaire."] I will deal with the millionaire' in a moment. I am now speaking generally of the old people. A great advantage of these Debates is that one is able to find out how opinion is moving in various sections of the House, and the Chancellor is assisted, on the information gained, in deciding in which direction it would be most in accord with the broad feeling of the House for him to move, as and when it became possible to make concessions. What total concessions can be made at any one time must depend on the general economic and other situations. As a result of six months—and it will grow into six years—of competent government, and of industrial revival, and of rapid release of men from the Forces, and of the skilled workers' contributions all over the country, we are able to make larger concessions than would have been wise six months ago.

Therefore, we come to this demand which was made with such force from all parts of the House on behalf of the old people. At one time I played with the idea that we might have some scheme for the release of credits, whereby in any given year we should release all the credits accruing in respect of that year's contribution; for example, all the postwar credits accruing in the first year of the system should all be repaid in this financial year, all those accruing in the second financial year should be paid the next year, and so on. I pondered on this idea, but it appeared to me not to be wise at this stage, because to give back a whole year's credits seemed to me and to my advisers to be unduly inflationary. Therefore, I considered what section of postwar credits, belonging to a particular year, we should give in priority over others, and, having regard to the views expressed in the House, it appeared to me to be best to concentrate upon the older people. Then I considered—and I am answering the right hon. and gallant Gentleman with complete frankness—whether it would be right and proper to restrict repayments to old age pensioners, and, in principle, there is a great deal to be said for that. But there are two reasons against it, which have decided me to recommend what I am now proposing. One reason is that there are a large number of border-line cases. If you take the old age pensioners, some would say "What about the police pensioner? He is a deserving person." There are other old people, too, who are near to the old age pension limit. And so you are led from point to point, and there is no clear administrative line of division to take. Therefore, I am making a concession, which I thought would be welcome to Members on the other side, by giving the benefit of repayment for old people of 65 and 60. If the Opposition put down an Amendment eliminating the Surtax payers, I will undertake to give it most careful consideration, but, as at present advised, I think it would be adminstratively simpler to let them all come in. All we have to do now is to require evidence of the date of birth.

The reason for taking 65 years of age for men, and 60 years of age for women, is that these are the ages, under the law, when old age pensions become payable —in industrial life women are eligible for retirement at an earlier age than men. But, if I have been too generous to the rich, let the Opposition put down an Amendment and I will give it careful consideration. The first three years which it is here proposed to repay are the three years in respect of which certificates —the actual pieces of paper—have been distributed. There again it is administratively convenient to arrange that these three years shall be repayable together, and it is also to minimise the danger of inflationary repercussions that only three years arc payable out of five. It is also convenient from the administrative point of view, because the Inland Revenue have had a hard time of it lately, and have not been able to complete arrangements for the distribution of the certificates for the last two years. In this case, by making this definite payment to the limited group of people we are going to emphasise that these post war credits are real charges, which are going to be met by the Government.

10.45 p.m.

Mr. Stanley

Even at this late hour it is really impossible to let the Chancellor of the Exchequer get away with that. He knows quite well that we on this side of the House welcome the proposals in this Resolution, because they are on the lines of our proposals last November. What we regret is that a few months ago the Chancellor should have so categorically rejected these proposals, not because, as he would like the House to believe now, of the danger of inflation and the impossibility of spending this money, but because, as he said, even if he had the money available it was the wrong way to do it and it would be indefensible to take, as he is now taking, a clear age classification. Naturally, in order to persuade his own followers—though they do not require much persuasion—to follow the Government Whips into the Lobby he had to bring in his little piece about the rich. What really has happened is that since he spoke in November he has had a month or two in which to think. Some people, of course, would say—though it is not the right hon. Gentlemen who sit on the Front Bench opposite—that he required to go through the process of ratiocination before he went through the process of elucidation. The fact is, of course, that having thought about it he now finds that what he said last November was quite wrong.

We are delighted that he should find it out and that he should impress upon the House this lesson—that in future we must recognise that when the Chancellor makes a statement it is very often not the result of a long process of thought and of discussion and of investigation in his Department but is merely the thoughts that spring to his mind at the moment. Though we know that what we put forward is likely in the first place to be rejected, it certainly will encourage us to know that, after a period of reflection, the Chancellor will agree with us. Whilst we accept with gratitude the general proposals, I desire to say that we were not impressed by the reason given for the differentiation between the male and female sexes. The whole point of the repayment of the postwar credits on the basis of age was the desire of the House that the old people should have a chance of enjoying repayment before they die. I do not believe that there is, in fact, five years' difference in the life of a male and a female. This differentiation means, in effect, that the man will have less opportunity of enjoying his postwar credit. Certainly, when we come to another stage, we shall want to examine more closely this differentiation, for which, at present, we do not see any justification.

Mr. I. J. Pitman

I fear that the Chancellor thinks that we are not likely to welcome this because of selfish reasons. I would like to assure him, and I think that I can speak on behalf of all the Members on this side of the House, that it is very largely from unselfish reasons that we welcome this Resolution. We sit here daily and see the grey heads on the Front Bench opposite, and the 81 Members of H.M. Government who are remunerated at rates up to£10,000 a year, and we are very glad indeed that they should have this return on their postwar credits. It is, therefore, in a spirit of real unselfishness that I welcome this Resolution.

Mr. Keeling

What evidence of age is required? Is everyone to be required to produce a birth certificate?