Second Schedule.—(PROVISION TO BE SUBSTITUTED IN SCHEDULE 2 PART I OF NATIONAL INSURANCE ACT 1946.)

HC Deb 06 February 1963 vol 671 cc494-562

Mr. Houghton

I beg to move, in page 11, line 18, to leave out columns 2 to 5 and to insert: 80 0 / 22 6 / 12 6 / 45 0".

The Temporary Chairman (Mr. F. Blackburn)

With this Amendment can be discussed the following:

In line 27, leave out columns 2 to 5 and insert: 80 0 / 22 6 / 12 6 / 45 0".

In line 29, column 2, leave out "38 6" and insert "42 0".

In line 41, leave out columns 2 to 5 and insert: 80 0 / 22 6 / 12 6 / 45 0".

In line 60, leave out columns 2 to 5 and insert: 80 0 / 22 6 / 12 6 / 45 0".

In page 12, line 15, leave out columns 2 to 5 and insert: 67 6 / 22 6 / 12 6 / 45 0".

In line 17, column 2, leave out "38 6" and insert "42 0".

In line 18, leave out columns 2 to 5 and insert: 80 0 / 22 6 / 12 6 / 45 0".

In line 25, column 2, leave out "37 6" and insert "42 0".

In line 30, leave out columns 2 to 4 and insert: 45 0 / 22 6 / 12 6".

In line 31, leave out columns 2 to 5 and insert: 80 0 / 22 6 / 12 6 / 45 0".

Mr. Houghton

As you have said, Mr. Blackburn, this Amendment can be taken in conjunction with a number more, and the debate will, in fact, cover all the main National Insurance benefits, excluding widows' benefits and married women's sickness and unemployment benefits, which have been singled out from the list of Amendments for later debate if we so wish.

I said a moment ago that the First Schedule which deals with contributions comes before the Second Schedule which deals with benefits. Therefore, I shall proceed straight away to deal with benefits and shall not for the moment say anything about contributions.

These Amendments ask for the standard National Insurance benefit and for retirement pension, sickness and unemployment benefit and widow's allowance to be increased to£4 a week as against£37s. 6d.in the Schedule, and for a married couple£6 5s. as against£5 9s. In other words, we are asking for 12s. 6d. a week more than the Government propose on the main benefits for single persons and 16s. a week more than the Government proposed on the main benefits for a married couple.

Carrying the comparison still further, the Amendments ask for 22s. 6d. a week more than the existing benefit of 57s. 6d. a week for a single person and 32s. 6d. a week more than the existing benefit of£4 12s. 6d. for a married couple. These Amendments are asking for substantial improvements—in comparative terms, they are very substantial improvements—on existing benefits and on what the Minister is proposing in the Schedule.

I think I ought to say a word about where these amounts come from. On Second Reading, I mentioned that the Social Insurance Committee of the Trades Union Congress had been to see the Minister and had asked that he should raise National Insurance benefits for a single person to£3 19s. 6d. Not only on this occasion but on a previous occasion, the Trades Union Congress has asked the Minister to raise benefits, and each time it has put its figure at the then existing National Assistance scale plus the average addition for rent allowance.

If we take the existing National Assistance scale for a single householder of 57s. 6d. and add to it the average addition for rent of 22s., we get£3 19s. 6d., and that is what the Trades Union Congress asks from the Minister. We have turned the£3 19s. 6d. into£4 not only because it is a rounder figure but because it is scarcely worth while continually repeating "£3 19s. 6d." when for all practical purposes we are talking about£4 a week. To arrive at£6 5s. for a married couple we have added an increased wife's benefit.

6.15 p.m.

I see that when the Joint Parliamentary Secretary was referring to this sort of level of benefits in the debate on 13th July, 1962, she said in column 1768 of the OFFICIAL REPORT that if we were to put up pensions to£4 a week for a single person and£6 8s. 6d. for a married couple, certain financial consequences would follow. I refer to this at the moment only to show that she had related£4 to£6 8s. 6d., whereas for reasons of our own we have related it to£6 5s. If it became of any importance to discuss the difference between£6 5s. and£6 8s. 6d. we might pursue that a little further, but I am sure that at the moment the Minister is so appalled at the£6 5s. that we need not bother to discuss refinements as between£6 55. and£6 8s. 6d.

I attach great importance to the representations of the Trades Union Congress. I assume that when the Trades Union Congress asks for something, first of all, it means it, and, secondly, it is fully aware of the financial consequences of what it is asking for. It is not just a little pressure group which demands something without counting the cost or without looking at many other aspects of its proposal. So we must look at the T.U.C. as being a responsible body in this connection. It is speaking for a very large number of organised workers, and whatever it says to the Minister as regards either benefits or contributions, its view will undoubtedly influence the attitude of 8–9 million workers at least who will be involved in any changes one way or the other.

Just after the Trades Union Congress saw the Minister, this Bill was introduced. But since then—only yesterday—the Minister has announced improvements in the National Assistance scales. So whatever may have been the arithmetical construction of the proposals made by the Trades Union Congress a few weeks ago, they are significantly altered by the Minister's announcement yesterday about improved National Assistance scales.

The new scales are to be: for a married couple 104s. 6d. a week and for a single householder 63s. 6d. a week, to which is to be added the rent allowance, averaging at present about 22s. a week. I am not going to say whether this means that the Trades Union Congress will see the Minister again and say that it has revised its figures in the light of the Minister's announcement of the new National Assistance scales. It is not for me to say what the Trades Union Congress will do; I was not even able to say that when I was on its General Council, and still less am I able to do so now. All I would point out in this context is that on the construction placed upon the word "subsistence" by the Trades Union Congress, the Minister presumably must regard its proposals of a fortnight or three weeks ago as already out-dated by the announcement of improved National Assistance scales.

For my purpose this afternoon, what I want to impress upon the Committee is that our proposals to amend the Second Schedule will give benefits lower than the new National Assistance scales after the addition of the rent allowance. So the first test we must apply to our figures, high as they may seem to conventional thought about the level of National Insurance benefits, is that they are lower than the new National Assistance scales plus additions for rent.

I do not know whether the right hon. Gentleman is keeping up the appearance—I will not call it a pretence, for we must be kind to him for the rest of the day—of a subsistence principle in the benefits of the scheme, but if he is then the proposals in this Schedule fall down on the very first test, the acid test of adequacy, because they are below what the National Assistance Board is now prescribing as the minimum standard of living in Britain today.

I think the Committee will agree that we must dispense with the use of the word "subsistence" in connection with National Insurance benefits when not only the Minister's proposals but even our own fall below the National Assistance minimum.

Another test that can be applied to our proposals is comparison with the existing level of earnings. This is a very significant test of the adequacy of any social security benefit. The Minister quoted on Second Reading the fact that the benefits are ahead of the increases in the cost of living, wages and earnings since last time and are miles ahead of the rise in the cost of living since 1948. I speak from memory, but I believe his comparison was that benefits had increased 160 per cent. since 1948 as compared with the 71 per cent. increase in the cost of living since then.

It would all sound most impressive if it were not completely irrelevant. One can double poverty and one is still poor. This is a question of contemporary standards. The truth is that all of us in our approach to social security today have abandoned the concept of subsistence contained in the Beveridge approach. It is not good enough now. Television sets and plenty of other things were not included in Beveridge terms of subsistence. Subsistence, as understood in the Beveridge Report, was, as I have said many times, the pre-war public assistance standard hotted up to take account of the increased cost of living during the war.

Now I come to earnings, because this really is an index of great importance. The Minister's proposals raise the single benefits to about one-fifth to one-quarter of the average male pay packet. That average, for the first week of October last, was£15 17s. 3d. The average earned in manufacturing industries was£16 6s. 10d. But taking account of October's average male pay packet, married couples under the Government's new proposals will get about one-third.

Sir S. Summers

Does not the hon. Gentleman agree that if such things as agriculture and many other services were included in the statistics his figures should be very different?

Mr. Houghton

I do not know how different. The hon. Gentleman is asking we to agree with him in general terms. I do not think that there would necessarily be a difference. There is plenty of room to play with if he wants it that way, because the benefits in the Bill are only one-third of the average figure. Thus, if he reduces that figure to£15, or£14 or£13 or even£12, there will still be quite a lot of room. The difference between earnings and the figures now proposed in this Bill still represents the measure of the fall in family income. It represents the degree of the fall in the standard of living when a couple cease getting full earnings and get National Insurance benefits instead.

Now I come to our proposals, and I want to impress their merits on the Committee. They would raise the single benefit to nearly one-quarter of the average male pay packet and the benefit for married couples to a little more than one-third but less than half. That is the test of comparison. Of course, there is another test which I think many who are not statistically inclined will always use, and so it is about as good as any other. It is the pragmatic one which any person can make without the aid of a single figure—personal experience, summed up in the question "Is£3 7s. 6d. a week enough to live on?" One will get the answer no matter whom one asks.

Another question is, "Is£5 9s. 0d. a week enough for a married couple to live on? Is it enough for their fuel and clothing and all their other domestic needs?" The universal answer would be, "No". But, of course, the Minister says that he has never advanced the case that these amounts are enough to live on. He says—and the hon. Gentleman the Joint Parliamentary Secretary is excellent at this argument—that they are not enough to live on but that nobody has to live on them.

The right hon. Gentleman in an interview with a magazine some months ago said that these benefits were a "foundation payment". In other words, he said: I merely lay the floor". He becomes, in this Bill, a kind of floor polisher saying, "I will lay the floor. I will at least see that you do not fall through it. But if you cannot exist on your social security, then I will tell you what to do. Have you an occupational pension? Have you personal savings?

Do you have help from relatives? All these will help provide additional shelter. But if you are really stuck I will give you the address of the nearest office of the National Assistance Board." That is really what the Minister says. Therefore, I ask him how he defines the foundation payment. How does he determine it? One can play with the word "subsistence" and look at earnings and wages or find some kind of criterion if one looks for it. But will the right hon. Gentleman say here and now how he determines a foundation payment? How does he decide how low the floor should be? When he decides that he wants to raise it, what considerations govern his decision?

When the night hon. Gentleman made his statement on the increases, I asked what criteria he used. He trotted out the dusty old answer that the cost of living had not risen anything like as high as the increases in the benefits. But that is not really the basis on which he decided how big these benefits should be. I therefore ask him to say to what he relates the improvements in this Schedule. Is it wages or earnings? Or is it the cost of living?

We on these benches have laid bare the secret of how we got at the figures in our proposals. Will he now be equally frank about his figures? We would then know where we were. We would know how he thought, as he knows how we think. Are these proposals the product of his judgment of what the economy will stand, or of what contributions he can impose, or of what the Chancellor says about the Exchequer contribution, or of what Prime Minister says about fighting back?

6.30 p.m.

Has the right hon. Gentleman been long enough at his Ministry to set his compass and get his bearings on the chart of social security? Where is he making for? He must have been very pleasantly surprised to have received instructions from the Cabinet that he must increase National Insurance benefits. I have no doubt that he thought that that was a very good beginning to what might otherwise be a dreary job. He was sent for not with his resignation in his pocket—he had not thought of it at that stage—but to be told that he must improve National Insurance benefits and must do something about National Assistance and must not raise the flat-rate contribution too high and, therefore, that he should have another raid on the graduated contribution. All that was told to him in the Cabinet Room.

He probably asked, "What am I to put them up to?" He was told to go away and think about it. He was told, "We can tell you shat the Chancellor of the Exchequer can spend about£28 million more out of the Exchequer contribution. You can to work it on that. You can take the 1959 Act and from that you can make increases on the flat-rate contribution and so much more on the graduated contribution and build up a total figure of£212 million out of the paltry£28 million extra which the Chancellor is prepared to give."

Where is he now? What is he to do about the future course of National Insurance? He is undoubtedly the prisoner of the flat-rate contribution which largely governs his room for manoeuvre with the level of benefits. His predecessor found an escape from all the inhibitions of the flat-rate contribution by turning to the attractive idea of a graduated pension scheme, which the Labour Party had put forward in 1957, and he found a devious use for it, for he used the extra money from that source to support increases in fiat-rate benefits.

There is nothing frightening in our proposals in the Amendment. I shall be told how much they will cost, and I have said something before now about the conventional use of the word "cost" in this context. It will not cost the Government more in cash than the increase in the Exchequer contribution. The other cost will go on the contributors. The hon. Lady the Joint Parliamentary Secretary said: If we were to put up pensions to£4 a week for a single person and£6 8s. 6d. for a married couple the total cost would be an extra£490 million, of which National Insurance would take£425 million, industrial injuries£25 million, and war pensions nearly£40 million."—[OFFICIAL REPORT, 13th July, 1962; Vol. 662, c. 1768–9.] The Government always want to add up the bill to make the task look absolutely impossible. They take a figure and put a bicycle pump to it and add two noughts and then say that the final figure is beyond the nation's capacity. It is not beyond the nation's capacity. If the nation wants this level of social security, it is quite able to pay for it. My complaint against the Government and against all the influences which are at work on the domestic spending of the nation today is that they are all turning away from more social security towards more consumer expenditure.

We have to get new social targets and then these benefits and this cost will fall into their proper place. There is no reason whatever why the cost should necessarily increase the flat-rate contribution by any specified amount. The whole thing is wide open and needs amending legislation. The flat-rate contribution can be made anything and the graduated contribution can be adjusted to any basis which we judge to be fair and right. We have complete power over the flexibility of the financing of the scheme.

I should be trespassing unduly on the patience of the Committee if I completely developed an alternative concept of social security on an Amendment of this kind, but I can say that the basis of the change would rest upon two main considerations—first, a proportionate contribution by all and, secondly, a defining of the range of the contributions at the beginning without tampering with them subsequently, unless that were absolutely necessary.

In the Bill we are extending the range of graduated contributions before the first year of account of the graduated scheme. The hon. Member for Bournemouth, West (Mr. Eden) pointed out yesterday the difficulties of altering the basis of contracting out. Speaking personally, I believe that the whole question of contracting out needs to be reconsidered in the light of the new idea of universal social security. The extraordinary thing at the moment is that we allow contracting out for maximum graduated contributions at 7s. 1d. but still retain universal compulsory insurance for a much higher flat-rate contribution. That seems to be upside down.

Radical new thinking is needed, and the nation must be taken into our confidence so that people can redraw their concept of social security and be prepared to pay for it. In 1948 there were comments about the cost of social security. Not only did Beveridge say that social security was worth its money price but the late Lord Waverley, when Chancellor of the Exchequer, said that it was something that we could not afford not to have.

It is wholly a question of the approach to these problems and the philosophy of the Government of the day. It may be that the right hon. Gentleman has come to his new office too late in the lifetime of the present Government to be able to make any impact on the future thinking on National Insurance and social security in Britain. There are those who are ready to take his place with ideas which have been formed after long consideration of this matter, ideas which offer a new breakthrough and a new significant advance towards a social security which we could offer to the world as an example of radical thought in Britain.

Sir S. Summers

If the debate on the Amendment were to cover the width of ground on which the hon. Member for Sowerby (Mr. Houghton) started, it would take a long time and would inevitably include some shadow boxing, because only half an hour ago the hon. Gentleman made it clear that there was great urgency about the Bill and that he was willing to allow time for an Amendment which he had moved earlier to be considered by the Government, even if that meant dealing with the matter otherwise than through the Bill.

To give effect to the kind of ideas which the hon. Member was outlining could be done only by gravely delaying the Bill's passage. However, this may be a convenient opportunity to make some observation on the subject, but I hope that the hon. Gentleman will not expect changes as drastic as those which he was advocating to be incorporated in a Bill which everyone wants to pass quickly.

I dissent from the notion that there must be a constant movement in line between National Insurance and National Assistance benefits. The hon. Gentleman said that the basis upon which his figures rested was calculated by a reference to the National Assistance scale. It would follow from the logic of his argument that if one went up, the other should go up. I can see why he takes that view on subsistence grounds, but I would regret slavish rigidity in the system in the way described, because it would preclude taxpayers' money being given particularly to the nationally assisted person, and which could not be so given if it meant spreading it right through to the people on National Insurance. It seems to suggest a rigidity which is undesirable for the future and which, I hope, the Minister will not seek to incorporate in any future changes that he may have in mind.

I have sympathy with the idea that we should move along the lines of graduated contributions and graduated benefits. I think that the drop, be it when unemployment or sickness arises, from wages as a significant figure is unreasonably great even if the drop from the lower figure is nothing like as great. The graduated ideas are designed to make the drop for the higher-paid workers somewhat less severe than it would be with only the flat-rate scheme.

One has sympathy with that, but when figures are quoted to show what a very small proportion in sickness or unemployment of the average wage the existing system provides, or indeed would be provided by the Amendment, I think that a false impression is created of a completely unrealistic situation because the figures relate only to a comparatively small section of the ordinary community, and omit large numbers whose wages are way below the average and would undoubtedly pull the average down.

The hon. Gentleman said he would concede that the gap is so large that even if what I am saying has some validity there is plenty of room to go up. Maybe, but I thought I detected a desire to get almost up to parity, in sickness or unemployment, the earning capacity of somebody normally at work. I think that we should delude ourselves and create a most absurd situation if we sought to eliminate a drop, and a real drop, because there must be one. Human nature being what it is, the whole concept of work would change if we sought so to protect people that irrespective of whether they were capable of getting a job or were sick, their capacity as breadwinners would be very much the same. That would be carrying things too far, and I do not think that the argument is improved by exaggerating it, which is what I think the hon. Gentleman did.

My only other point is to ask how far it is reasonable to push up these benefits if one has regard to the amount contributors will spend? If the idea is bandied around, particularly when a comparison is made with countries on the Continent, that we ought to be doing a great deal better than we are, and to that is added the notion that there is a real limit to what people are prepared to pay each week to give effect to the improvement in the parity figures with the Continent, the only way to do it is at the expense of taxation.

am not at this stage saying whether to use taxation in that way is good or bad, but what I am anxious to insist on is that if the argument is advanced that the taxpayer can find more money, it must be related to the other demands that are made on him for schools, hospitals, roads, or what we will, and so far the taxpayer's contribution to National Insurance has been related more to the scheme itself, to what people pay into it, than to counter-claims on the Treasury.

If the contributor is to be severely limited, and the benefits are to be greatly increased to such an extent that the taxpayer provides a much larger proportion of the bill from which these benefits are paid, it is inescapable that the claims of the other benefits for the community, be it hospitals, roads, and the like, must be taken into account and the answer judged accordingly, whereas now that comparison is not made, and barely needs to be made, because the taxpayer's contribution to the scheme is relatively small compared with that of the employer and the contributor.

6.45 p.m.

If it is going to be argued that that situation will not arise because we will take it out of the employers, different considerations arise, but the hon. Member for Sowerby is perhaps fortunate in that the order in which these Amendments appear preclude us from spending any appreciable time on contributions because they have been dealt with. There was no reason why he should not have tabled Amendments designed to give effect to his subsequent Amendments and thus not escape, as he has done, the real challenge of how these are to be paid for. I do not want to develop that at length.

Mr. Houghton

I have not the means of constructing an entirely new scale of contribution. It is just impossible.

Sir S. Summers

That is why I said that this was rather a shadow-boxing Amendment, because it has no real validity in terms of this debate. If we are going to lift our sights—and I do not complain about that—we must bring into focus the other claims on the taxpayers' money which, at the moment, in terms of National Insurance, play very little part in the consideration of these matters.

Mr. McKay

I am glad of the opportunity to take part in this debate. I disagree with the hon. Member for Aylesbury (Sir S. Summers). If one considers the financing of the National Insurance Scheme in general, one finds that the Exchequer pays only about one-sixth of the amount contributed by employers and employees.

I congratulate my hon. Friend the Member for Sowerby (Mr. Houghton) on the lucid way in which he dealt with the various aspects of the problem. He showed quite clearly that we have passed the age when Beveridge, who was extremely clever, intelligent and an able administrator, laid the foundations of an insurance scheme. We have gone far beyond that stage. The world has moved away from the ideas prevailing when Beveridge put forward his proposals.

It appears to me that this scheme is upside down in many respects. When I consider this problem, I find that in reality people are keen on pressing our citizens into applying for National Assistance and having their private affairs examined before they receive a reasonable income, but there is this amazing fact which is relevant to the position today. Let us consider two men with similar houses and similar sized families. One is in receipt of National Assistance, the other is in receipt of National Insurance benefits. The situation is such that the man on National Assistance can get 44s. per week more than the man on National Insurance.

That is a very unsatisfactory position. I do not think we always realise it, nor do the Government always realise it. They appear to think that if the basic position is the same, the position of a man and his wife on National Assistance level is somewhat similar. They have a feeling that there is a problem and on this occasion they are not raising National Assistance level so much as National Insurance level.

Is that principle a sound financial one? Is it a sound moral one? Both sides start largely level, but they are not even level because the very foundation of the financing of the two schemes makes a big balance in favour of the man on National Assistance. We are creating a scheme and a method whereby every encouragement is given to people to go on National Assistance and very little encouragement is given to men who are paying in the ordinary way through National Insurance.

Take the case of a man on£15 a week. Under the Bill he will be paying 13s. 4d. a week. When he becomes ill or unemployed he must ask for assistance if he is to be in the same position as the man who is not paying for insurance. Is it a satisfactory system when a man who has not worked for years, does not want to work and will get as much as he can out of the situation can legally demand monetary help equivalent to that received by the average worker?

Is it satisfactory that that can be done while, after the Bill is implemented, a tremendous number of men will be paying not 13s. 4d. but 7s. 6d. under the graduated scheme and about 8s. on the flat-rate every week? When such a man is ill or has an accident he will get in benefit 42s. a week less than the other man. The whole matter is very unsatisfactory.

I have taken the example of three men, all living in the same kind of domestic conditions. This is a fair comparison. A man who has£12 a week is paying the same rent, living in the same street and with all the same domestic difficulties as the other two. If we examine these cases fairly no one can say that the system is satisfactory. The man who is underinsured and becomes ill gets 67s. 6d. and 41s. for his wife. The married man on National Assistance gets 104s. 6d., but that is not his income, it is simply the basic payment. They both get the same basic payment, but one receives in rent, say, 25s. a week. In the first stages, the man who is married gets 25s. a week more than the man who is insured and is sick. He is in a worse position than the man who perhaps for years has not paid into National Insurance.

Take the next stage where a man is married and has two children. He will get.51s. for the children under National Assistance under National Insurance he gets 40s. That is another difference of 11s. between two men who may be living in absolutely the same circumstances. The insured man with three children gets 169s. and the man on National Assistance gets 183s. 6d. plus, perhaps, his rent.

The final difference is that the insured man who is sick and who has three children gets 169s. and the other has 183s. 6d. because the allowance for children under National Assistance is much greater than that under National Insurance. As the number of children in the family grows, the difference becomes greater between National Insurance benefit and National Assistance.

In my examples I have taken families in similar circumstances, in similar houses and in similar local conditions. An insured man with three children receives 169s. A man on National Assistance receives 183s. 6d., plus a rent allowance of 25s. The anomalous position thus arises that the man who has been paying for years, perhaps at the rate of 15s. or more, receives 44s. a week less than the man who perhaps has not worked for a long time.

7.0 p.m.

Do we believe that this is a satisfactory state of affairs? It must be admitted that this is a very difficult problem, but a change should be made if the benefits under National Insurance are to be improved to the extent to which most of us want to see them improved. It cannot be a good principle that a man who has paid National Insurance contributions for years, whilst he has been working, should receive about£2 a week less when he needs help than a man on National Assistance.

It is a bad principle. However, it seems to be generally accepted at the moment that the principle should be a permanent one. We seem to be approaching the position that, regardless of the fact that ordinary citizens will be liable to pay£1 a week in insurance contributions, other people who have not perhaps subscribed for years receive greater benefits.

Under what principle can it be argued that National Assistance benefits must of necessity be as great as—in fact greater than—National Insurance benefits? The position is becoming fantastic when people in receipt of National Assistance receive£3 a week more than people receiving National Insurance benefits.

The various political parties should get together on this point and reach combined agreement. We are anxious to ensure that people who are unable to work shall be kept alive in a satisfactory condition, but there must be a limit. The limit is surely reached when men who are not working get such a sum that they are better off perhaps than working men. Most people, regardless of political view, want a National Insurance system which will give people an income at least equal in economic worth to that which men on National Assistance get. We want men on National Assistance to get as much as possible within reason, but we do not want the multitude of men in the country who pay almost£1 a week to find when they suffer adversity that men who have not been paying anything can receive£2 a week more than they, unless they, too, apply for National Assistance.

There is a limit beyond which we should not pass. However, I do not believe that we shall ever modify the differentiation between National Assistance and National Insurance, because it is a political weapon which is used at General Elections. I do not know that the principle is supported by logic or common sense, but, whatever benefit the man on National Insurance receives when he is in adversity, from whatever cause and no matter what contribution he pays, the National Assistance people create and argue that National Assistance benefits must rise at the same speed and the same height merely because they are in difficulties.

Mr. George Thomas (Cardiff, West)

So they ought to.

Mr. McKay

That is where my hon. Friend takes a different view from me. To me it is wrong that there should be this weighting against the man on National Insurance who pays so much in contribution. The time has arrived when National Insurance benefits should at least equal National Assistance benefits.

Mr. Philip Goodhart (Beckenham)

The hon. Member for Wallsend (Mr. McKay) said that he admired the con- structive speech of the hon. Member for Sowerby (Mr. Houghton). So did I, but it should be remembered that in any discussion on new pension rates it is legitimate for any Opposition to press for more. It is politically expedient that they should.

I admit that the series of Amendments under discussion have made me somewhat depressed. The most perceptive critics of the present National Insurance and pension arrangements are agreed that they are too non-selective in character. We are providing vast sums of money, but it is very doubtful whether enough relief is yet given.

Twelve years ago we were paying£275 million in National Insurance benefits. When the Bill is passed that sum will rise to more than£900 million—yet there will be still a substantial amount of suffering. It would be wrong for any hon. Member not to be grateful to the Government for the substantial benefits that they are bringing forward in the Bill, but I join with hon. Members who have criticised them for introducing yet another Measure which advances stiff further the flat-rate increase in benefits.

I would have preferred to have seen the general increases concentrated in a number of special areas. For example, the hon. Member for Sowerby said that our ideas on this topic had changed in recent years. Indeed, our whole approach to the idea of growing old has changed with the advance of medical science and improved standards. People are retaining their youth and vigour to a greater age than was common a mere twenty years ago.

The principle is generally agreed that need increases with age. No longer at, say, 65, but rather at 75 or 80, does it become increasingly difficult for people to meet the challenges of everyday life and, it would seem, more aid should be channelled to those people.

I would have liked to have seen in the Bill a concentration on those who are old so that retirement pensioners aged 70 to 80 could have benefited to a greater extent. But no; we are sticking to the flat rate all round. It is understandable that the Government should do this; regrettable, but understandable. Once a system is established it takes a great deal to shake the Ministry out of the normal course of events. Its is regrettable to see the Opposition—who are not troubled with bureaucratic responsibilities—when faced with the whole question of increase in rates, merely look around and say, "We want more for everyone" instead of taking a more selective approach.

This series of Amendments makes me think that if we are to get improvements in the future they will have to come from pressure from my hon. Friends and not from hon. Members opposite.

7.15 p.m.

Mr. G. Thomas

The hon. Member for Beckenham (Mr. Goodhart) always makes a thoughtful speech and I listened to his remarks with growing interest, waiting patiently for some of his ideas about the future of the National Insurance Scheme. He skirted around the question, decided that our ideas were not up to his standard and promised us that, in some magic way and at some distant time, those ideas will come from his hon. Friends. Maybe, some day.

I believe that already there is a ferment of thinking in the country about the National Insurance Scheme. The very fact that the Bill must be amended in this way is an indication that the Government have grown flabby, are tired in their thinking and are incapable of any new ideas, particularly in relation to the National Insurance Scheme. They merely float on along the lines we started after the war without realising that we have entered a new era.

The hon. Member for Beckenham was right when he said that there is a new social attitude towards the needs of the under-privileged in our community; those unfortunate people who are either unemployed or who, in old age, have not enough resources to live in comfort. I thought that the hon. Baronet the Member for Aylesbury (Sir S. Summers) adopted a typical Conservative attitude on this question, for he seemed to indicate that if we provided too much social security people would cease to work.

Sir S. Summers rose—

Mr. Thomas

I will give way.

Sir S. Summers

I must protest at the gross misrepresentation on the part of the hon. Member of what I said. I merely said that if the benefits for people who were out of work or sick were at the same level as were their earnings, serious and disastrous results would follow.

Mr. Thomas

I had no intention of doing the hon. Member an injustice. I knew that he was sitting in his place and would contradict me if I misrepresented him. The general idea of what he said is that if we provide too much social security people will not work. That is what the hon. Member said.

Sir S. Summers

Does the hon. Member intend to provide too much social security?

Mr. Thomas

Certainly, too much security will not be provided by hon. Members opposite. This Measure is an indication of what hon. Members opposite believe to be generosity in our society, for they are always boasting of how well off people are. The hon. Member forgets that there are a great many people who are doing very well as a result of the labours of the general body of workers—people who never dirty their hands or do a day's work and who are not paying the contributions they should for the maintenance of the unfortunate people whom we are discussing tonight.

That is why I want to see the basis of contributions altered. I want to see more come from taxation. I want to see these people who are dodging paying their proper contribution to the Welfare State made to pay it. There is only one way to get them to fulfil their social obligation, and that is by the Chancellor of the Exchequer helping the Minister of Pensions and National Insurance to squeeze it out of them. They will never contribute in any other way.

The Government have muffed their chances. Last Friday afternoon, in Cardiff, the capital of Wales, I attended a meeting of the Cardiff Area Council of Old-Age Pensioners. There are 32 branches in the city, comprising 5,000 members. It is my privilege to be their president—I do not boast, I merely state a fact. What did I find? Of course, it is appreciated that there has been an increase, or the promise of an increase. They are certainly a little puzzled about the date, we all are, but they ask, "Why do the Government still work on the principle that we all have other means on which to live? The retirement pension is not enough for retired people."

It is humiliating when people have worked for forty years, and are unable to save for their old age, that they must face a means test. It is a myth that the majority of our working people can afford to keep themselves, or, indeed, subsidise their old-age pension to any extent in retirement. They just cannot.

The majority of our working people live from hand to mouth. They absorb their wages—they need them to live on. How dare we tell them, at the end of their working days, "You must now go through this humiliating business of the means test," making them answer the most personal questions that are an affront to the dignity of old people? I think that Parliament has missed its chance in not originally putting in the figures now proposed by this Amendment.

My hon. Friend the Member for Wallsend (Mr. McKay) for whom I have a very great respect and affection, if I may say so, was anxious about the disparity between working people who fall sick and those who have been for years on the Assistance Board, who are getting more. I would remind the Committee that people who have for years been on National Assistance are in a bad way. They are at the end of their tether. We all hold our "surgeries" and meet these people. I know of no more humiliating experience when, in modern Britain, people have to ask me if I can try to get the Assistance Board to provide them with some trousers or some underclothes. That is the experience of my hon. Friends, as it is mine. We have to write letters to the Board about the people concerned. This is the picture of the submerged Britain against which we have been closing our eyes.

I feel deeply when anyone says that folk who have been on National Assistance, for years, and have never contributed, are well off. He does not know their circumstances. No one can describe them as being well off. The Assistance Board leaves nobody well off—nobody. It is quite right, of course, that those who pay ought not to fall below. The trouble is not that the Assistance scales are too high—and I know that my hon. Friend did not mean that they were—but that the benefits are too low. Here we have a monopoly insurance scheme, and the benefits are far more unequal than they ought to be.

Our idea of a new deal for the unemployed, the sick and the old is obviously very different from that of hon. Members opposite. I am not afraid to face the electorate in my division and say that there must be more from taxation to pay for increased benefits for the old folk, because when we are taxed we pay according to our ability. The richer people are, the more they pay—and so they should. They still have plenty left to live on. We should not be putting such a burden on those millions of people who are earning less than£10 a week. They are carrying a burden that belongs to the strong, which is another reason why I like this Amendment.

I should like to see a new and more humane approach made to the National Insurance Scheme. These benefits are inadequate, and should be increased.

Mr. McKay

I hope that my hon. Friend the Member for Cardiff, West (Mr. G. Thomas) will not misconstrue what I said. My point is that the basic scale of all our people ought to be raised far above its present level. The pensioners would get it just as would the National Assistance people, but the time may come when we can go beyond that and see to the betterment of the insured people.

Dr. Horace King (Southampton, Itchen)

I should first like to follow up what was said by my hon. Friend the Member for Wallsend (Mr. McKay). My hon. Friend devotes a great deal of his life to examining the problems of National Insurance, but in his search for a really adequate National Insurance benefit he pushes some of his criticisms too far. None of us, I think, shares his view of the National Assistance Board to whose work so many of us pay tribute, which will remain for quite a long time yet. Indeed, it is probable that it will have to remain even if we ever succeed in creating a perfect National Insurance scale, in order to provide a net for the exceptional cases.

I am sure that my hon. Friend did not mean to do so, but when he differentiated between the short-term and the long-term unemployed he referred to some of the long-term unemployed as being people who might not want to work. I must say for the record that every National Insurance Report for the last few years has shown quite clearly that the number of malingerers in our society is quite infinitesimal. The records show that the long-term unemployed people do not want National Assistance—they want work. Unemployment is a bitter hardship; long-term unemployment is a tragedy.

The hon. Member for Beckenham (Mr. Goodhart), who has left us for a moment, said that he was worried about the growth of what might be called nonselective National Insurance, but what ought to worry him, as it worries us, about those whose cause we are now pleading is that the people who are now in the greatest need will get less out of the combined benefits of the National Insurance and National Assistance increases than anyone else in the whole country.

The hon. Baronet the Member for Aylesbury (Sir S. Summers)—

Mrs. Slater

He is not a baronet yet.

Mr. William Hamilton (Fife, West)

It is difficult to keep track, is it not?

Dr. King

—indulged in what I regard as the favourite Tory tactic of playing down the Opposition, suggesting that our indignation is synthetic, that these are academic debates and that my hon. Friend the Member for Sowerby (Mr. Houghton) indulges in shadow boxing. No hon. Member on either side who knows the capable and sincere work done by my hon. Friend would charge him with shadow boxing. Indeed, it is within the recollection of the Committee that if he thinks a thing is wrong he will unite with the Treasury Bench against his own back benchers, as I remember to my own cost.

In these debates we are trying to win concessions, and if the hon. Baronet's argument means anything it means that as the Government have a majority there is no point in the Opposition putting down Amendments they believe to be right, and that Parliament might as well pack up. We believe, on the other hand, that today's debate is part of a battle that we began a long time ago to secure a socially just treatment of all our citizens. And most of the arguments which the hon. Member for Aylesbury used in his speech were arguments which were used against the first old-age pensions when Lloyd George introduced them.

7.30 p.m.

The hon. Member is right on one point. The basic question is whether the people of Britain are prepared to pay for what we believe is socially just and right. We on this side of the Committee believe that they are prepared to pay if the method of payment is itself socially just and right, but that involves a question I cannot go into on these Amendments.

On all these Amendments we are discussing just how poor the poor can be, and what is the basic level below which no British citizen should fall. I want to say a few words on behalf of the old people. I am sure that all hon. Members will agree that a remarkable feature of the letters they have received from old-age pensioners, individually and collectively, in the last week is that they have been unanimous. They make two points, that the basic pension should be£4 a week, and this is one of our Amendments, and the other that the increases should have been made earlier and, since they have not been made earlier, they should be made retrospective. The letters are polite and dignified. They appreciate what the Government are doing, but they do not beg for more. There is a tone in the letters of a rightful pride and a rightful demand on the part of old people for their share of the nation's increased prosperity.

The old folk about whom I am worried most are those who are living just on their pension plus National Assistance. Unless our Amendments are accepted, the Bill, roughly speaking, will ask the old-age pensioners, man and wife, if they have no private means, to live on 109s. a week plus rent. Even that will be cut back a little because of the difference between the proposed increase of basic pensions and the proposed increase of National Assistance scale plus concessionary allowances which the National Assistance Board allows to 150,000 of the 200,000 of the worst cases. But this group which needs it most will not even receive the full benefit of the 10s. a week increase proposed in this Bill.

If our Amendments were accepted the old-age pensioner and his wife would receive 125s. a week plus rent and plus the concessionary bits which National Assistance gives. Old folk need warmth much more than anybody else, I do not know how the old folks of Britain have survived this winter.

Mrs. Slater

Many have not.

Dr. King

If for a moment we drop the battle between the two sides of the Committee about the amount of the pension, it can be said that it is the steadily improving provision which we have made since the war for old folk that has prevented many of them from dying this winter. Many would have died if we had not built up the Welfare State in the last fifteen years.

I have watched them trudging through the snow to their Darby and Joan Clubs, going there for the warmth. One couple have written to me to say that they must have 2 cwt. of coal a week and they need electric light and gas for cooking. They write—and I have no reason to doubt them—that the total cost of these is 28s. a week, and that is in an ordinary winter, not this winter. There is no hon. Member who has provided himself with heat, light and cooking during this bitter winter on 28s a week. If this is the cost to these old people and they have no private income they will be left with£4 a week under the new scale to buy what food they need, including food at enhanced prices because of the winter, and their clothing and small comforts.

I have never forgotten an old-age pensioner who came to my surgery some years ago. He was worried about his gas meter and he produced a little note book, in which every single penny that he had put in the gas meter was carefully recorded. We are dealing with people to whom pennies and shillings really matter. I know that hon. Members on both sides of the Committe help old folk individually. On Second Reading the hon. Member for Tottenham (Mr. A. Brown) told us of the wonderful work done in the crisis by Lady Morrison and of the provision of coal for hundreds of old folk through voluntary gifts.

Fine voluntary work is done in every community, and I hope it grows. There are the meals-on-wheels, the splendid work of the churches in providing Darby and Joan clubs, and the Christmas gifts which the Rotary and other clubs provide for the old folk. The Welfare State does not mean the abolition of charity. We do not ask people to cease making their neighbour-loving gifts. But these gifts and the lovely deeds done at Christmas tend to obscure the fundamental issue, because charity is indiscriminate and many people do not benefit.

I had this brought strikingly home to me recently. A Southampton newspaper, one of the best local newspapers in the country, spoke about the fine work done for the old folk and said that none in Southampton had been forgotten. I received a letter of protest which I will read to the Committee to show the kind of people for whom we are pleading through these Amendments. It reads: I am the treasurer of the Golden Age club, and we are the forgotten few. The Stoneham Club and the Stoneham Youth Club were the only ones to send little gifts of a small box of chocolate biscuits…Fords kindly allow us the use of their sports room which enables us to keep together. We support ourselves by our annual subscription of 4s. We have a rotary system in which each member gives a draw every week. With this money we make gifts for our sick members and help towards our summer outing. If the young people were as generous to there fellow young people as the old people are to their fellow old people this would be a much better country. The club treasurer adds: Our oldest member is 90 and the youngest is in her seventies. These are typical of the people whom we want to help.

They are the kind of people who have made Britain. They are proud, cheerful and self-reliant. What they want is not charity, however loving, or gifts in the freeze-up but an adequate reward at the end of their lives. It is on their behalf that the honorary secretary of all old-age pensions associations in South Hampshire writes: We welcome the pension increase, but we must protest that it is too small. Our demand is for an immediate increase to£4. We protest too at the long wait. If, as you say, it is impossible to do the job any sooner, will you make the increase as soon as you can, in fact from 23rd January?…We are not satisfied with the 10s. increase. We want not less than£1 and we want it now at once. Reference has been made from the benches opposite to the youthfulness of old people. This letter is a youthful and vigorous demand on behalf of the old folk of the country and I am happy, through the Committee, to present it to the Minister. The old folk had a raw deal this winter. I hope that we can improve the provisions that we are making in the Bill by acceptance of the Amendment for the old folk.

Mr. W. Hamilton

I have always thought in these debates that the House of Commons should be seething with indignation at the way the old people are treated by us over the years. From the other side of the Committee we have had two typical speeches, the contents of which could have been forecast before the two hon. Members spoke. We had the hon. Member for Aylesbury (Sir S. Summers) and the hon. Member for Beckenham (Mr. Goodhart), both representing comfortable, respectable constituencies.

I used to live in Beckenham. I know the kind of people who live there. I never voted for the hon. Member who represents Beckenham. If there had been a pair of old boots on the platform with a Labour label on them, I would have voted for them rather than for the hon. Member. He made the kind of speech that makes me want to be sick. He described our proposal as a shady, political manœuvre. Nobody can ever accuse my hon. Friend the Member for Sowerby (Mr. Houghton) of indulging in that kind of tactic. If there is anybody who adopts a more responsible and more informative attitude to this kind of problem, I do not know of him.

My hon. Friend is abundantly honest in facing these issues and the implications of what he is arguing. He never shirked that this afternoon. He said, frankly and openly, that had it not been for the way in which the Bill is presented he would have accepted the need for increased contributions to finance the increased allowances for which we are arguing.

We think that the scheme that the Minister and his Government are trying to operate is not the best possible. We have a much better one. The Government have simply sought to make a tawdry copy of the scheme that we on this side produced years ago. Having chastised and accused my hon. Friend the Member for Sowerby of that kind of tactic, the hon. Member for Beckenham went on to argue that we should channel the increases only to those between 70 and 80 years of age. As my hon. Friend the Member for Southampton, Itchen (Dr. King) said, however, that is selective. It is selective in the sense of penalising the worst-off section of the community, those on National Assistance. They would get less than all the others who benefited under the scheme.

7.45 p.m.

The hon. Member for Aylesbury was on another tack. He argued that it was easy for an Opposition to ask for more; that was in the nature of politics, a sordid auction for votes. One side says one thing, the other says something else, each going one better. It is not like that at all. The hon. Member went on to say that there were other claims upon the national wealth, such as health and education. All the educational or health enthusiasts want more for their various services, and where is it all to come from? That argument was never produced when the Prime Minister suggested that we would get half a dozen Polaris submarines at£40 million apiece. There was no suggestion then that we must get our priorities right. We do not get that kind of speech from hon. Members opposite until we debate old-age people and people on National Assistance and National Insurance benefits.

My hon. Friend the Member for Itchen wondered how the old people had survived this winter. The brutal fact is that many of them have not. I want to get this on the record. I have in my hand today's issue of the Glasgow Daily Record, and this is what it says: Hundreds of Scotland's old folk are dying in the cold—too poor to buy the food and warmth to keep thorn alive. They are fighting a lonely battle…and facing a frightening dilemma. For they must choose whether they will spend their few shillings on food OR on coal. They can buy coal…and starve. They can buy food…and freeze, prey to the killers, bronchitis, pneumonia, heart trouble and rheumatism that come with the cold. But they cannot buy coal AND food. Necessity is out of their reach; comfort beyond their dreams. Since December 1st, in Edinburgh alone, 727 pensioners have died. That is 10 every day for the last 2½months, and these people are on our consciences. I do not know how many of those have died because of the inadequacy of their income, but a good proportion of them must have done so. We all know cases in our constituencies and from our experience where old people are having to choose between coal and food. They get one or the other, but they cannot get both.

The article continues with the quotation that Everybody must do something. We must rid ourselves of this scandal of old people who die because they can't afford warmth and food. And if we can't help, we must bring their names to the attention of people who can. A Scottish spokesman for the Oxford Committee for Famine Relief is reported as saying: We've donated£1,000 for blankets, coal and food to the Salvation a Army to help among the old. What an assessment of our modern civilisation in 1963 that an organisation which seeks to prevent hunger in distant parts of the world has to divert resources to help our own old people because we have never yet had a Government that would educate the people to the need for providing much more for the old than any Government have ever done.

Like my hon. Friend the Member for Sowerby, I say frankly that there is an educative process to be carried out. We have to say brutally and frankly to our people that if the old folk have to get infinitely better treatment than they have now, we, the younger generation, must pay, and we must pay either by contributions in the scheme or by taxation, or both.

There is another answer. One of the difficulties in which the Government have landed themselves is that they have not been increasing the national wealth that would make this possible. If we had had the 4 per cent. increase in national income per year over the last ten years that N.E.D.C. has announced, we would have had no trouble. But we are trying to alter the shares of a cake that remains static in size. That is why these debates are rather artificial. We are trying to isolate them from the context of the whole national economy.

Nevertheless, let us assume that we get the 4 per cent. increase per year, as I hope we will—but it will not be under this Government. They do not have a clue about anything. Wherever one looks, their policies are in a shambles. If, however, we get the 4 per cent. a year, we can agree that our first two priorities must be the young and the old. Those are the first two. If we want to take an increased proportion of the national cake for them, one way is to take it out of the taxpayer's pocket. I would prefer that. If I had my way, I would scrap the whole sham of an insurance system. It is not an insurance system. I do not know why we call it insurance.

The simplest way would be to finance the whole lot out of general taxation, but I know that I tread on a lot of corns when I argue that. However, it has the merit, at least, that everybody would pay according to his ability to pay. It seems to me that that would be the fairest way to ensure that everyone played his part and shared the burden of this highly civilised activity. This Government do not want to educate the people of this country to the need for that kind of activity. We shall have to wait for another Government to do it.

Mr. N. Macpherson

I think that it might be convenient if I intervened at this stage. We have had quite a considerable debate already and a great many people have expressed different views.

Mr. James Dempsey (Coatbridge and Airdrie)

Not very many.

Mr. Macpherson

I am sorry that the hon. Member for Sowerby (Mr. Houghton) is not in his place, but I have no doubt that he will be here soon.

Mr. William Ross (Kilmarnock)

He has been here all the time.

Mr. Macpherson

I know that. Notwithstanding his absence at the moment, I feel that I should start by following up some of the points which the hon. Gentleman made.

The hon. Member for Sowerby told us how he reached the figures in his Amendment. He asked me how I reached mine. What we have before us in the debate are two rival sets of proposals. The picture which the hon. Gentleman drew of the way I reached my figures did not augur very well for what would happen if he were running this part of the country's affairs and did what he wanted to do. I ask the Committee to consider the two sets of proposals in perspective.

The hon. Gentleman's proposals range, for the main rates, from about a 29 per cent. increase for a wife to a 39 per cent. increase on the single benefit as it is at present. Our increases range from 17 per cent. to 19 per cent. for the various benefits. There are one or two which lie outside, but that is the main range.

The Committee will want to know what the cost of the hon. Gentleman's proposals would be. It knows what the cost of ours is. His proposals would cost£420 million on National insurance in the first full year, which is£220 million more than the cost of ours. That is not taking into account any consequential costs there would be for other benefits such as Industrial Injuries insurance and war pensions, which may be a matter of another£25 million to£30 million. If this were done entirely on the flat-rate contributions it would represent an increase of 1s. 8d. a side. The hon. Gentleman implied that, from his point of view, and, he thought, perhaps from mine, we had reached the limit of increasing flat-rate contributions.

I am glad to see that the hon. Gentleman has now returned to his place. I was just dealing with the points which he made and I was giving the cost of his proposals as, roughly,£420 million on National Insurance in the first full year, plus the consequential costs. I had just said that the cost would be about 1s. 8d. a side, although I appreciated that it was the hon. Gentleman's view that we had reached the limit of increasing flat-rate contributions. In addition to the 1s. 8d. a side, there would be a cost involved of£45 million to the Exchequer.

This liability would go on increasing. On pensions alone, our proposals will involve expenditure rising from£1,000 million in 1964–65 to£1,429 million 17 years later. The hon. Gentleman's proposals would cost proportionately more, rising all the time.

Someone has got to pay. My hon. Friend the Member for Aylesbury (Sir S. Summers) made a very cogent speech in which he said, as I understood it, that the more one lays the burden on the Exchequer the more does one bring into the area of conflict the amounts which we are prepared to pay out of the Exchequer for benefits of this description as against other social charges. One of the great advantages of having a scheme of this sort, with fairly well determined proportions of charges in a known ratio, is that we know where we stand in advance.

The hon. Gentleman said that, by and large, his figure was based on the existing National Assistance scale for the single householder, plus the average rent. We are bound to ask then what we should do about the National Assistance rent allowance. We can raise National Assistance rates, perhaps by the same amount, perhaps not; but, if we were to raise them by the same amount, this would then cost a further£35 million on National Assistance, and, of course, in addition to that, the higher scales would bring in more applicants, and this would enhance the cost.

Mr. Ellis Smith

Hear, hear. That is what we want.

Mr. Macpherson

If we did not raise National Assistance, the result would be—I think that it appeared from the debate last November that this was one of the results desired by the Opposition—a massive transfer of those on National Assistance to the Insurance scheme. The effect would be that about 500,000 of those now receiving National Assistance supplements would cease to do so. If we did it in this way, basing ourselves on the National Assistance single householder rate plus the rent, we should then be paying the rent of many people who could afford to pay it for themselves. We should be providing more rent than they needed for some and less for others. [HON. MEMBERS: "Oh."] I mean less than they need to pay their rent for some and more than they need for others. Roughly half the people then who received National Assistance supplements would, presumably, still have to rely on National Assistance.

All this really comes from the dislike, which the hon. Member for Cardiff, West (Mr. G. Thomas), expressed, of making an application to the National Assistance Board. But the difficulty of providing a subsistence rate is illustrated by this approach. Subsistence must, of course, include rent, but a subsistence rate which is based on a fixed National Assistance allowance plus a fixed amount for rent is bound to founder on the fact that rents vary widely.

There will always be people who are unable to provide for their present, let alone their future—and some of us are not even able to provide for our past. Ought we to call on our citizens to pay enough to enable everyone to get sufficient in benefits to ensure that no one should have to apply to the National Assistance Board provided, at least, that he or she had paid what was due to the National Insurance Fund?

My hon. Friend the Member for Beckenham (Mr. Goodhart) suggested a more selective approach. That, at least, is the direct opposite of the approach suggested by the Opposition.

8.0 p.m.

The hon. Member for Southampton, Itchen (Dr. King) recognised that this was so, but said that our proposals mean that the people in greatest need will get less. I do not know what he meant by that. As a result of the National Assistance increases, people in the greatest need will get more. If he is saying that they will not get as much as the full increase in the National Insurance benefits, that is because they are on National Assistance. This is bound to be the case wherever an intermediate increase of National Assistance rates is made which then has to be taken into account when we bring in a subsequent National Assistance increase in line with a National Insurance one.

Dr. King

The simple fact is that the poorest people will get a 10s. a week increase in their old-age pension, but because the National Assistance rates have gone up not only by 10s. but by 6s., whereas other people in the country will get the 10s. a week increase, their net increase will be 6s.

Mr. Macpherson

That is so. We are agreed about that. But to imply that they will get less as a result of these proposals is quite untrue.

The hon. Member for Sowerby asked how we arrive at our figures. I do not think that this can be better expressed than by quoting the words of my right hon. Friend the Chief Secretary to the Treasury when he said about making proposals of this kind: The factors which have to be borne in mind in proposing legislation for the improvement of National Insurance benefits include changes in the cost of living, the standards enjoyed by other sections of the population, what level of contributions would be reasonable and the state and prospects of the national economy.—[OFFICIAL REPORT, 14th November, 1960; Vol. 630, c. 18.] It boils down to a question of judgment, and the figures in the Bill represent our judgment in the light of these considerations.

We have considered the pledges which we have given. We have pledged ourselves to ensure that pensioners continue to share in the good things which a steadily expanding economy will bring, and these increases reflect that policy. We can claim that we have consistently pursued a policy of raising benefits in real value as standards of living rise. We have had regard to the cost of these increases in the benefits, and to their impact on contributors, on the taxpayer and on the economy as a whole.

What has been the result? Under our proposals, the pension is now worth 50 per cent. more in real value than in October, 1951, when we took over. This has been a consistent policy of advance. Sickness and unemployment benefits are worth over 80 per cent. more in real value than in October, 1951. But, some may say, is this enough as a proportion of the national income?

In 1951, the proportion which National Insurance and Industrial Injuries benefits bore to the gross national product was 3.1 per cent. As a result of these increases, the proportion, on the 1961 figure, would be 41.8 per cent. Our proposals, as I say, represent an increase of between 17 and 19 per cent. on the existing rates compared with an increase of 9.1 per cent. in earnings over two years and an increase of 6.1 per cent. in retail prices since the last increase came into force. In those circumstances, I ask the Committee to say whether or not our judgment is right.

Mr. Dempsey

I join the chorus of support for this Amendment. I was intrigued by the remarks of the Minister about making a judgment on these increases. I should like the retirement pensioners to say whether they are much better off to the extent quoted by the Minister than they were in 1951. The pensioners should be the judges of that, not the Minister.

The Minister's judgment is similar to the judgments that we have had recently in international affairs. Our deterrent policy has collapsed in ruins. The right hon. Gentleman's judgment is a manifestation of the judgment that we had in the recent European debacle. The domestic economic situation is another example of the Government's muddling judgment. The Minister of Pensions and National Insurance has been consistent in following the innocuous examples of his right hon. Friends.

Anyone who considers the increases proposed must surely know that they are inadequate to provide living standards for the categories of people who are entirely dependent on State benefits. These categories cover the pensioners, widows, those in receipt of the guardian's allowance, the unemployed, and so on. A great deal has been said about benefits for certain categories of widows, in which I have participated, but I should like tonight to refer first to the pensioners.

I spent the Christmas Recess mainly attending pensioners' meetings, functions and little socials. I have seen them toddling for miles through snow and bitter frost into the heart of a large town in my constituency in order to collect a little envelope containing 5s. at the annual Christmas party. They were reduced to braving the stormy elements of the Scottish climate mainly in order to collect 5s. extra to spend on their Christmas dinner, although they had also entertainment. This is the plight of pensioners, not the fantasy painted by the Minister a few moments ago.

We should face this situation objectively. In my view, the Minister is trying to face it philanthropically. We are dealing with the section of the community which not only suffers the most but which has suffered the longest. It is the duty of those associated with the pensioners and who have their interests at heart to speak up for them on an occasion such as this.

There is not the slightest doubt that pensioners are living at starvation level. My mother, like many others, is a pensioner. She is having to buy three bags of coal a week during this cold weather. The average price of a bag is 10s. 4d. That means that 31s. of her weekly pension is spent on coal. Gas has increased in price. She has to keep the gas going to help keep the kitchen warm. The price of electricity has increased. There is also a need for additional foodstuffs, fats and nutritives to try to carry these old people over this wintry season.

The Minister would be well advised to look at the reply which his predecessor gave to a Question which I asked a year ago about how many pensioners died between January and March, 1962. If he does that he will get the shock of his life. That is the period in the year which has the most telling effect on aged people. Yet the right hon. Gentleman offers 1½million of them a miserable 6s. a week—less than 1s. a day. If he thinks that that is sufficient to give pensioners a reasonable standard of living, then he is completely divorced from the realities of the situation.

Mr. N. Macpherson

The hon. Gentleman will bear in mind that the rates were raised by 4s. before the winter, so that that increase, together with this 6s. increase, brings the total increase up to the increase in National Insurance benefits.

Mr. Dempsey

I have pointed out to the Minister that the old folks with whom I associate have had to buy extra bags of coal. My mother is one of them and she has been buying two extra bags of coal a week at 20s. 8d.

Mrs. Alice Cullen (Glasgow, Gorbals)

Surely she cannot afford it. My hon. Friend must be buying it for her.

Mr. Dempsey

Well, I am too modest to comment.

How does the Minister expect 4s. to augment realistically the income of these poor old souls? There is nothing more saddening, humiliating and nauseating to me than to see advertisements in the local Press asking for clothes, shoes or perhaps an old wireless to give comfort to the old folk during their hours of loneliness; and, incidentally, the wireless is very often their only companion. That is the sort of standard on which pensioners are existing in this wintry weather.

I wish to impress on the Minister the necessity to take a realistic view of this problem. If he did so, he would be apologising for the miserable increases which he proposes to give pensioners. When examining the plight of these people we should bear in mind the present day cost of living. The Minister has been making great play with the value of the pension today compared with 1951. But he did not mention that food subsidies had been abolished during that period. Milk and bread subsidies have been abolished, and incidentally, some bakers have been forced out of existence by the Government's financial policy. He has failed to mention the appreciable increase in the price of milk, which is a tonic for the old folks. They delight to have milk puddings, sometimes twice a day, but those puddings require milk and that is a very costly item. If the Minister cares to add up these costs and others such as clothes and footwear he will discover that the cost of living for old folks is far beyond the rates of pension which he advocates.

A Scottish Old Folks Welfare Committee has been examining living conditions in Scotland, and among the many conclusions that this committee has reached is the following: It has now been acknowledged that the retirement pension of itself does not and will not ensure a reasonable and proper standard of life for retired persons. That conclusion was reached by a committee appointed not by the Labour Party in Scotland, a committee consisting of representatives of all aspects of public life, such as for example the W.V.S., the Red Cross, social organisations and community centre representatives. That is their impartial judgment on the standard of pensions in this country, and I would prefer to be guided by such people who give so nobly of their time voluntarily to promote the interests of old folks and who have arrived at such very compelling conclusions.

Having said that, I am always wondering when we shall arrive at the stage of planning pensions so that we can gradually eliminate the need for National Assistance. National Assistance today plays an indispensable part in the lives of 1½million pensioners. That is admitted. Indeed, I believe that their officers accomplish a very difficult task. My criticism is not of the Minister's officers. Indeed, the area officer with whom I am in contact in Coatbridge and Airdrie is one of the finest and most outstanding officers that we have. He is understanding, sympathetic and willing to co-operate to the best of his ability in helping those in need. But naturally he and his staff can only do so within the framework of the regulations. That is why, until we reach the stage when pensions will be adequate to provide a decent living standard for these people, National Assistance will continue to be important as a supplement.

8.15 p.m.

It is regrettable that once more I have to say—and, incidentally, this is the third time in the past few years—that the National Assistance scale increases do not correspond with pension increases, as a result of which 1½million pensioners will not receive the full increase to which they are entitled. I feel that I should make that point because it is a bone of contention among the pensioners in my constituency.

I hope that so long as National Assistance continues, the Minister will get back to the original arrangement which was in force for many years throughout the 1940s and early 1950s whereby increases in National Assistance corresponded to increases in pensions, thus avoiding irritable anomalies.

Mr. N. Macpherson

Is it the hon. Gentleman's intention that there should be increases in National Assistance similar to those proposed in the Amendment?

Mr. Dempsey

Speaking for myself, I should like the Minister to revert to the original practice which was adopted for many years in the 1940s and early 1950s, by which increases were awarded at a rate consistent with each other, so that we do not have the anomaly of pensioners who receive National Assistance getting less than the increase enjoyed by other pensioners. In this respect, I am merely speaking for myself, but I have been very consistent on this point.

As a member of a local authority, I took a deputation to meet the Minister's predecessor to express to him the importance of pursuing that principle. I can assure the right hon. Gentleman that when I return to my constituency I shall be hammered from all angles because many pensioners will not be receiving the full increase. I must make that point very cogently on behalf of those whom I represent, so that they can hammer the Government instead.

I now want to mention briefly—because others are anxious to speak—this question of unemployment benefits. I want to make it unquestionably clear to the Minister that it is jobs that I want, and it is jobs that the people in my constituency want. When he was Parliamentary Secretary to the Board of Trade he regularly heard me pleading for these jobs. In my constituency no less than 9.5 per cent. of the insured population is unemployed owing to the failure of the Government to provide those jobs, and, in view of that failure, for which the Government must accept responsibility, the Government have a duty to pay these people decent rates of benefit. I support the Amendment in this respect.

I now wish to mention one of the most heartburning problems of all—juvenile unemployment. In Lanarkshire scores of young boys and girls have been paid off recently owing to a trade recession, with little hope of finding other employment because there is a waiting list of school leavers. There are growing youths who require clothes and footwear regularly, whose style changes very often—boys and girls who need an adequate standard of benefit until such time as jobs are made available. The right hon. Gentleman's proposals are inadequate to meet that demand. Therefore, I support the Amendment in this respect. The benefits should be increased as proposed in this Amendment, so that at this time, when so many are unemployed, they can have a fairly reasonable standard of living.

I am convinced that the Minister has not really appreciated the magnitude of this problem. It is probably because he is fortunate; he does not represent an industrial area where there is a very large number of people unemployed of whom a substantial proportion are boys and girls aged between 16 and 21. If he were conscious of the demands of those young people he would advocate proper proposals for scales of benefit.

The scales indicated by my hon. Friend the Member for Sowerby (Mr. Houghton) are much more reasonable than those proposed by the Minister and it is for that reason that I support the Amendment, and I hope that my hon. Friend will press it to a Division. The old folk and the others are dependent on a stand being made on an issue such as this to ensure that their plight is drawn to the attention of the Government and the Government galvanised into action and into giving much better rates of pension and unemployment benefit and so on. The rates proposed by my hon. Friend are much more acceptable and I will certainly support the Amendment, by voting for it in the Division Lobby.

Mr. Houghton

I rise to do exactly what my hon. Friend the Member for Coatbridge and Airdrie (Mr. Dempsey) has asked, that is, to press this Amendment to a Division, if the Committee feels that we can now do so. We have had a long debate, the second debate only of the day, and we have a very long way to go, and there are other matters to which we want to give equal attention. Our next debate, for example, is on widows' benefits, which we regard as of the highest importance.

I apologise to the Minister for being absent for a moment or two at the beginning of his speech. It was my first absence from the Chamber since half-past three. I am obliged to him for repeating for my benefit one or two of the things that he had said earlier.

The right hon. Gentleman mentioned not only the level of the benefits proposed in the Amendment, but the cost. He did not, however, say that this level of benefits proposed in the Amendment was in his opinion too high. When he referred to the cost he was really confirming the figure I had already quoted, having made reference to the speech of the Joint Parliamentary Secretary earlier. The right hon. Gentleman did not say the cost would be too much. He merely said what the cost would be, and left it rather open as to whether it was one which the community could bear.

I wonder whether he has studied the recent statement comparing social security costs in the countries of the European Economic Community and this country. I have just picked up a little broadsheet on Britain and Europe and the social security of the Six, and I see here that on the last available figures, in 1957, the lowest percentage of national income going to social security in all the Six in the European Economic Community was 12.1 per cent. In Western Germany, it was nearly 21 per cent.

Those are the countries which we were so anxious to join because of their vigorous economy, their enterprise, their exports, their labour costs, their dynamic economies—all such that we wished to be associated with them. Every one of them appears to send a larger proportion of its national income on social security than Britain.

The Joint Parliamentary Secretary to the Ministry of Pensions and National Insurance (Mrs. Margaret Thatcher)

I wonder whether the hon. Gentleman will complete the picture by pointing out that hourly wages in this country were higher than in any of the other countries in Europe at the same date?

Mr. Houghton

I do not really see that that has any bearing on the matter. If our hourly wages are higher, then presumably we in Britain are better able to afford this higher standard of social security.

This pamphlet describes various ways of paying for it. It shows a variety of methods. Some countries ask contributors to pay a higher proportion; other countries lay more upon the exchequer; other countries ask the employers to pay considerably more than the workers towards social security. There is a considerable variety of experience both of provision of and payment for social security in Europe.

So there is nothing sacrosanct in the structure of our own National Insurance Scheme. Moreover, they have not had flat-rate benefits or flat-rate contributions: they are all wage related.

I do not really think that the Minister, by his argument, has destroyed the validity of the Amendments that we have put down. What we ask him to do is to reconstruct the scheme to accommodate a higher level of benefits, and that is not beyond his capacity to do, nor beyond the capacity of the nation to bear, by whatever method the Minister might seek to finance increased National Insurance benefits. In these circumstances we must say to the Minister that he has not discouraged us from pressing this matter upon the Committee. This is where we stand, on our level of National Insurance benefits, and we ask the Committee to adopt it.

Question put, That the words proposed to be left out stand part of the Schedule:—

The Committee divided: Ayes 198, Noes 161.

Division No. 42.]	AYES	[8.26 p.m.
Agnew, Sir Peter	Cunningham, Knox	Henderson, John (Cathcart)
Aitken, W. T.	Currie, G. B. H.	Hill, Mrs. Eveline (Wythenshawe)
Allason, James	Dalkeith, Earl of	Hill, J. E. B. (S. Norfolk)
Arbuthnot, John	Dance, James	Hocking, Philip N,
Ashton, Sir Hubert	Deedes, Rt. Hon. W. F.	Holland, Philip
Awdry, Daniel (Chippenham)	Digby, Simon Wingfield	Hope, Rt. Hon. Lord John
Barter, John	Donaldson, Cmdr. C. E. M.	Hopkins, Alan
Batsford, Brian	Drayson, G. B.	Hornsby-Smith, Rt. Hon. Dame P.
Baxter, Sir Beverley (Southgate)	du Cann, Edward	Howard, John (Southampton, Test)
Beamish, Col. Sir Tufton	Duncan, Sir James	Hughes Hallett, Vice-Admiral John
Bell, Ronald	Eden, John	Hughes-Young, Michael
Bennett, F, M. (Torquay)	Elliot, Capt. Walter (Carshalton)	Hurd, Sir Anthony
Bennett, Dr. Reginald (Gos & Fhm)	Elliott, R. W. (Nwcastlc-upon-Tyne, N.)	Iremonger, T. L.
Bevins, Rt. Hon. Reginald	Emery, Peter	Irvine, Bryant Godman (Rye)
Bidgood, John C.	Farr, John	James, David
Biffen, John	Fell, Anthony	Jenkins, Robert (Dulwich)
Biggs-Davison, John	Finlay, Graeme	Johnson, Dr. Donald (Carlisle)
Bishop, F. P.	Fisher, Nigel	Johnson, Eric (Blackley)
		Johnson Smith, Geoffrey
Bourne-Arton, A.	Fraser, Rt. Hn. Hugh(Stafford&Stone)	Jones, Arthur (Northants, S)
Box, Donald	Fraser, Ian (Plymouth, Sutton)	Joseph, Rt. Hon. Sir Keith
Boyle, Rt. Hon. Sir Edward	Gammans, Lady	Kirk, Peter
Braine, Bernard	Gibson-Watt, David	Lancaster, Col. C. G.
Brewls, John	Gilmour, Ian (Norfolk Central)	Langford-Holt, Sir John
Brooke, Rt. Hon. Henry	Gilmour, Sir John (East Fife)	Leavey, J. A.
Bullard, Denys	Goodhart, Philip	Leburn, Gilmour
Burden, F. A.	Goodhew, Victor	Legge-Bourke, Sir Harry
Campbell, Sir David (Belfast, S.)	Gower, Raymond	Lilley, F. J. P.
Campbell, Cordon (Moray & Nairn)	Green, Alan	Linstead, Sir Hugh
Carr, Compton (Barons Court)	Gresham Cooke, R.	Litchfield, Capt. John
Clark, Henry (Antrim, N.)	Grosvenor, Lt.-Col. R. G.	Lloyd, Rt. Hn. Geoffrey(Sut'n'C'dfield>
Clarke, Brig. Terence (Portsmth, W.)	Gurden, Harold	Loveys, Walter H.
Cleaver, Leonard	Hamilton, Michael (Wellingborough)	Lucas-Tooth, Sir Hugh
Cooke, Robert	Harris, Frederic (Croydon, N.W.)	McAdden, Sir Stephen
Cooper, A. E.	Harris, Reader (Heston)	McLaren, Martin
Cordeaux, Lt.-Col. J. K.	Harrison, Brian (Maldon)	McLean, Neil (Inverness)
Costain, A. P.	Harvey, Sir Arthur Vere (Macclesf'd)	McMaster, Stanley R.
Coulson, Michael	Harvey, John (Walthamstow, E.)	Macmillan, Maurice (Halifax)
Courtney, Cdr. Anthony	Hastings, Stephen	Macpherson, Rt. Hn. Niall(Dumfries)
Craddock, Sir Beresford (Spelthorne)	Hay, John	Maitland, Sir John
Crosthwaite-Eyre, Col. Sir Oliver	Heald, Rt. Hon. Sir Lionel	Marshall, Douglas
Marten, Neil	Profumo, Rt. Hon. John	Thatcher, Mrs. Margaret
Matthews, Gordon (Meriden)	Proudfoot, Wilfred	Thomas, Sir Leslle (Canterbury)
Mawby, Ray	Quennell, Miss J. M.	Thompson, Sir Kenneth (Walton)
Maxwell-Hyslop, R. J.	Rawlinson, Sir Peter	Thornton-Kemsley, Sir Colin
Maydon, Lt.-Cmdr. S. L. C.	Redmayne, Rt. Hon. Martin	Tiley, Arthur (Bradford, W.)
Miscampbell, Norman	Rees, Hugh	Touche, Rt. Hon. Sir Gordon
Moore, Sir Thomas (Ayr)	Roberts, Sir Peter (Heeley)	Turner, Colin
More, Jasper (Ludlow)	Robinson, Rt. Hn. Sir R. (B'pool, S.)	Turton, Rt. Hon. R. H.
Morrison, John	Rodgers, John (Sevenoaks)	Tweedsmuir, Lady
Mott-Radclyffe, Sir Charles	Royle, Anthony (Richmond, Surrey)	van Straubenzee, W. R.
Neave, Airey	Russell, Ronald	Vane, W. M. F.
Nicholson, Sir Godfrey	Sharples, Richard	Vaughan-Morgan, Rt. Hon. sir John
Osborn, John (Hallam)	Shaw, M,	Vickers, Miss Joan
Osborne, Sir Cyril (Louth)	Skeet, T, H. H.	Wakefield, Sir Wavelt
Page, John (Harrow, West)	Smith, Dudley (Br'nf'rd & Chlewick)	Wall, Patrick
Pannell, Norman (Kirkdale)	Smyth, Rt. Hon. Brig, Sir John	Wells, John (Maidstone)
Pearson, Frank (Clitheroe)	Speir, Rupert	Williams, Dudley (Exeter)
Peel, John	Stevens, Geoffrey	Williams, Paul (Sunderland, S.)
Percival, Ian	Stoddart-Scott, Col. Sir Malcolm	Wilson, Geoffrey (Truro)
Peyton, John	storey, Sir Samuel	Wise, A. R.
Pickthorn, Sir Kenneth	Studholme, Sir Henry	Wolrige-Gordon, Patrick
Pilkington, Sir Richard	Summers, Sir Spencer	Woodhouse, C. M.
Pitt, Dame Edith	Tapsell, Peter	Worsley, Marcus
Pott, Percivall	Taylor, Edwin (Bolton, E.)
Powell, Rt. Hon. J. Enoch	Taylor, Frank (M'ch'st'r, Moss Side)	TELLERS FOR THE AYES:
Prior, J. M. L.	Teeling, Sir William	Mr. MacArthur and Mr. Pym.
Prior-Palmer, Brig. Sir Otho	Temple, John M.
NOES
Abse, Leo	Hamilton, William (West Fife)	Parker, John
Ainsley, William	Hannan, William	Pavitt, Laurence
Allen, Soholefield (Crewe)	Harper, Joseph	Peart, Frederick
Awbery, Stan (Bristol, Central)	Hart, Mrs. Judith	Pentland, Norman
Bacon, Miss Alice	Hayman, F. H.	Popplewell, Ernest
Barnett, Guy	Henderson, Rt. Hn. Arthur(Rwly Regis)	Prentice, R. E.
Beaney, Alan	Herbison, Miss Margaret	Price, J. T. (Westhoughton)
Bence, Cyril	Hill, J. (Midlothian)	Probert, Arthur
Bennett, J. (Glasgow, Bridgeton)	Holman, Percy	Pursey, Cmdr. Harry
Benson, Sir George	Holt, Arthur	Redhead, E. C.
Blyton, William	Hooson, H. E.	Reid, William
Boardman, H.	Houghton, Douglas	Rhodes, H.
Bottomley, Rt. Hon. A. G.	Howell, Denis (small Heath)	Roberts, Albert (Normanton)
Bowen, Roderic (Cardigan)	Hughes, Emrys (S. Ayrshire)	Roberts, Goronwy (Caernarvon)
Braddock, Mrs. E. M.	Hughes, Hector (Aberdeen, N.)	Robertson, John (Paisley)
Brockway, A. Fenner	Hunter, A. E.	Robinson, Kenneth (St. Pancras, N.)
Broughton, Dr. A, D. D.	Hynd, H. (Accrington)	Rodgers, W. T. (Stockton)
Brown, Thomas (Ince)	Hynd, John (Attercliffe)	Ross, William
Callaghan, James	Irving, Sydney (Dartford)	Short, Edward
Carmichael, Neil	Jay, Rt. Hon. Douglas	Silverman, Julius (Aston)
Castle, Mrs. Barbara	Jeger, George	Silverman, Sydney (Nelson)
Cliffe, Michael	Jones, Dan (Burnley)	Skeffington, Arthur
Collick, Percy	Jones, Elwyn (West Ham, S.)	Slater, Mrs. Harriet (Stoke, N.)
Corhet, Mrs. Freda	Kelley, Richard	Slater, Joseph (Sedgefield)
Craddock, George (Bradford, S.)	Key, Rt. Hon. C. W.	Small, William
Cullen, Mrs. Allce	King, Dr. Horace	Smith, Ellis (Stoke, S.)
	Lawson, George	Sorensen, R. W.
Dalvell, Tam	Lee, Frederick (Newton)
Davies, G. Elfed (Rhondda, E.)		Soskice, Rt. Hon. Sir Frank
Davies, S. O. (Merthyr)	Lee, Miss Jennie (Cannock)	Spriggs, Leslie
Deer, George	Lever, L. M. (Ardwick)	Steele, Thomas
Dempsey, James	Lewis, Arthur (West Ham, N.)	Stewart, Michael (Fulham)
Diamond, John	Loughiln, Charles	Stones, William
Dodds, Norman	Mabon, Dr. J. Dickson	Swain, Thomas
Driberg, Tom	McColl, James	Taverne, D.
Dugdale, Rt. Hon. John	McKay, John (Wallsend)	Taylor, Bernard (Mansfield)
Ede, Rt. Hon. C.	McLeavy, Frank	Thomas, George (Cardiff, W.)
Edwards, Rt. Hon. Ness (Caerphilly)	MacMillan, Malcolm (Western Isles)	Thomas, Iorwerth (Rhondda, W.)
Edwards, Robert (Bilston)	MacPherson, Malcolm (Stirling)	Thompson, Dr. Alan (Dunfermline)
Edwards, Walter (Stepney)	Manuel, Archie	Thornton, Ernest
Evans, Albert	Mapp, Charles	Tomney, Frank
Fernyhough, E.	Marsh, Richard	Wade, Donald
Finch, Harold	Mason, Roy	Wainwright, Edwin
Fitch, Alan	Mayhew, Christopher	Warbey, William
Fletcher, Eric	Mendelson, J. J.	Whitlock, William
Foot, Dingle (Ipswich)	Millan, Bruce	Wilkins, W. A.
Forman, J. C.	Milne, Edward	Williams, LI. (Abertillery)
Fraser, Thomas (Hamilton)	Mitchison, G, R.	Williams, W. R. (Openshaw)
Galpern, Sir Myer	Moody, A. S.	Williams, W. T. (Warrington)
George, Lady Megan Lloyd(Crmrthn)	Morris, John	Willis, E. G. (Edinburgh, E.)
Gourlay, Harry	Moyle, Arthur	Wilson, Rt. Hon. Harold (Huyton)
Grey, Charles	Neal, Harold	Woof, Robert
Griffiths, David (Rother Valley)	Noel-Baker, Francis (Swindon)	Yates, Victor (Ladywood)
Griffiths, Rt. Hon. James (Lianelly)	Oswald, Thomas
Griffiths, W. (Exchange)	Paget, R. T.	TELLERS FOR THE NOES:
		Mr. Ifor Davies and Mr. McCann.

Dr. King

I beg to move, in page 12, line 19, column 2, to leave out "95 0" and to insert "102 6"

I understand, Sir Norman, that it will be convenient also to refer to the following four Amendments on the Notice Paper, that is to say, in line 19, column 3, leave out "30 0", and insert "32 6" in line 22, column 2, leave out "97 6" and insert "105 0'; in line 23, column 2, leave out "67 6" and insert "80 0"; and in line 24, column 2, leave out "67 6" and insert "80 0".

The debate we are now to have is on a matter about which, I believe, both sides of the Committee are doing new thinking. I hope that it will call from the Minister the kind of response which we were delighted to welcome in our debate on the industrial injuries aspect. These Amendments deal with almost all widows. But many remain outside any benefit and are not affected at all, while those with the meagre benefit of 10s. are also not covered. These two groups cannot be covered by these Amendments or by this debate, although subsequent Amendments will give us the opportunity to consider again the plight of the 10s. widow.

The present structure of widows' benefits is threefold. There are widows' allowances, widowed mothers' pensions and widows' pensions. I want to look at all three. First, there is the allowance for the first 13 weeks of bereavement which, under the Bill, will be 95s. a week. We seek to raise it to 102s. 6d. a week. When the right hon. Gentleman's predecessor appointed a committee, in 1956, to report on widowhood it was an excellent committee and produced a valuable and thoughtful report. But I believe that it made one or two errors. It said, for instance, in paragraph 27: The period for short-term resettlement benefit of widows allowance is adequate for its purpose. It is true that its terms of reference excluded it from dealing with the amount paid for those 13 weeks. It could only deal with the question of the 13-week period itself. I myself believe that this period is too short for the tragic process of rehabilitation and adjustment which must take place in a widow's life after bereavement, and especially if the husband's death followed a long illness, with the consequent drain on the wife, both physically and mentally, quite apart from the drain on the household economically.

The Committee said that the widow's allowance should be substantially above the widow's pension, and it suggested that it should be half as much again. The Minister now proposes that the pension should be 67s. Half as much again would bring us to 101s. 3d. We propose 102s. 6d., because in other Amendments we also seek to raise the pension. Any Government, any House of Commons, with imagination, any hon. Member of the Committee with the knowledge and experience of some friend near and dear to them who has been struck by this tragic blow, will concede the first Amendment.

Most widows step down from poverty to hardship for the rest of their lives when their good men have gone, and all we are asking in the first Amendment is that we give such a widow, for 13 weeks only,£5 2s. 6d. instead of£4 15s. for herself and 32s. 6d. instead of 30s. for her first child. This is the widow's allowance for the first 13 weeks of widowhood and the cost can be only very small, but the amount of good which the money given in this way could do could be very great.

I interpose here that one of the matters which I hope that the Minister will consider when he is thinking about this matter of widowhood is the question of what we give to the widow at the moment of bereavement, in the first weeks just after bereavement, both the amount and the time for which we give it.

The Amendment has to be considered in the context of the others, and in view of an earlier debate, we are asking for all the Amendments. This is not an academic exercise and behind them all is the desire to raise the standard of living of all widows as far as we can inside the scope of the Bill. If the Government accept the Amendment, at some subsequent time and in some subsequent Bill, we might be able to consider a really adequate widow's allowance for the first weeks of bereavement.

The third Amendment seeks to improve the lot of the widowed mother. In this connection, the 1956 Committee and, after it, the former Minister of Pensions have done magnificent work. I believe that the Chief Secretary to the Treasury will be remembered in his Parliamentary history for his work for widowed mothers, for the children of widowed mothers and, incidentally, for disabled ex-Service men. However, we are not anywhere near the goal of right and proper treatment of the widowed mother.

I have been reading the debates on the Widows', Orphans', and Old Age Contributory Pensions Act, 1925, which was the Act which gave all widows whose husbands were insured and who had been widowed at the appropriate time, of course, 10s. a week, with additions for their children if they had any, without an age test, without a means test and without an earnings rule. We condemned it in those days as being inadequate. An important feature of that debate was that from both sides of the House there came the enunciation of a principle, a principle which emerged in our splendid debate yesterday on the earnings rule.

I quote a Conservative, Viscountess Astor: …the widow with little children should not be forced either to go out to work or to apply to the guardians. That was her view of the principle which we should be seeking to implement.

Our old friend, the late right hon. J. H. Thomas, in the same debate, said: …instead of a woman being driven to work and the neglect of her children as well as of her own health, an opportunity ought to be given to her to look after her children."—[OFFICIAL REPORT, 19th May, 1925; Vol. 184, c. 303–70.] Being a mother is a full-time job and it ought to be recognised by the State as such. The youngster who has the misfortune to lose his father should not be prevented by that misfortune from having the best education for which he is fitted, and as far as possible we should secure for him all the benefits of a home. One of the benefits of a home is that his mother should be at home, especially if his father has gone. I believe that if we apply the words of the 1956 Committee to the principle which the Committee enunciated, that we should seek to help those who cannot reasonably be expected to re-enter the employment field and rely on their own earnings", that group ought to include all widows who are bringing up families.

8.45 p.m.

Our Amendment would help a little We are proposing that the widowed mother's allowance be raised to 105s.

a week during the first 13 weeks, these grim 13 weeks of bereavement, instead of the Government's proposal, and we are proposing at the same time that the 67s. 6d. a week widowed mother's allowance should be raised to£4. Even with these Amendments the widowed mother and her children will be miles below the standard of living, if they have to live on this, which they would have enjoyed if the husband had been one of the lowest-paid workers in the country. Indeed, most of them, even if we carry this Amendment, will still have to go out to try to earn more money.

When we are considering the question of the widowed mother, do not let us forget that all the family commitments, or most of them, continue when the good man has died. The house still has to be the same house. The widow cannot move out of it because there is one less human being to live there, and the debts and commitments continue. I hope that the Government will look favourably at the second Amendment, which proposes to raise the widowed mother's allowance for the first 13 weeks, and the widowed mother's subsequent allowance for the rest of her widowed motherhood. I interpose to thank the Minister for what he has done, even in this Bill, to improve the lot of the widowed mother. He is following the lines of his predecessor.

The third Amendment looks at the question of the widow's pension itself. This is awarded to the widow with no children, or whose children are no longer dependent, always provided that she is over 50. I believe that the late Neville Chamberlain was right when, in 1925, he defended the pension for all widows which his Government introduced in that year. In the debate on 18th May, 1925, he said to some of his hon. Friends who wanted the age limit to be 40, and to exclude childless widows: What about the widow who is 39½? We would ask, in this context, what about the widow who is 49½? He continued: What about the widow who has had one child and that child had died? Is she to lose not only the child but also the pension?"—[OFFICIAL REPORT, 18th May, 1925; Vol. 184 c. 89.] The idea at the back of the minds of the pioneers of widows' pensions in 1925 was that there was something about widowhood itself which the State ought to compensate. We have moved away from the sort of fundamental approach of the earlier contributory widows' pensions Acts. These Acts sought to give a man and his wife insurance against widowhood itself. It was right that we should move in the opposite direction, but I think that we have gone so far in the opposite direction, so anxious are we to avoid the State keeping able-bodied widows for all their lives, that we impose an age limit of 50, and we give the widow, even if she qualifies for the pension, which we seek to raise in this Amendment, on her widowhood, for the loss of her protector and breadwinner, only 67s. 6d., and only that if she is over 50. Our Amendment to line 24 would raise this 67s. 6d. to the£4 which we have sought throughout all these debates to underpin as the basic minimum pension.

In a way this series of Amendments may be said to be a patchwork approach to the grave problem we discussed yesterday, last Friday and many times before. It is a series of Amendments based on the principles we have so far maintained since 1946. I should be happy to know if the Minister will accept some of the Amendments. Any or all of them would improve the position of many widows. If the Amendments are accepted tonight, we shall be left only with the grim fact that there are groups of widows whose husbands were too old to get full benefit and who receive nothing or the derisory 10s. a week, on the one hand, and those between 40 and 50 years of age with no dependent children who find it very difficult to obtain suitable work.

We want a full-scale inquiry into widowhood. We have to examine whether even the 1956 recommendations can stand up to modern examination, whether or not there are improvements which we might profitably make in this part of the Welfare State. I remind the Committee that when the 1956 Committee reported on the question of widowhood it made an important qualification. Paragraph 48 said: We wish to emphasise, however, that our conclusion"— that is, that the present pattern was accurate and suitable— relates to present employment conditions. If large-scale unemployment were to occur the qualifying age for widow's pension might have to be reconsidered. I suggest that there is a further argument for this re-examination of the whole question of widowhood—the fact that employment is becoming more difficult. When it is harder to find work the people who find it hardest and on whom the impact of the present unemployment position is greatest are the disabled, on the one hand, and widows, on the other.

I hope that the Minister will approach these Amendments in the spirit in which I have endeavoured to present them, and that he will at any rate accept some of them.

Mr. N. Macpherson

I certainly have no complaint whatever about the way in which the hon. Member for Southampton, Itchen (Dr. King) has moved this Amendment. He has done so with great cogency and real feeling, and he has not overstressed his case which obviously he has studied very carefully.

We come back to what I said about the last Amendment, that these are ultimately questions of judgment as to exactly what the rates should be. The hon. Member suggested that the rates should be set at 7s. 6d. higher for the widow's allowance on the basis of a suggestion made by the National Insurance Advisory Committee. He quoted a suggestion that the rates should be roughly half as much again as the standard rate. I think it would be a mistake to make a change of that sort in isolation. We have to keep the relativities as they are. The cost, of course, would not be enormous; it would be£½million. This being a transitional payment, of its nature it is a peculiarly difficult one to fix. As I have said, I think this is a question of judgment.

The hon. Member was only able to argue—it was a very cogent argument—that a transitional payment of this kind should be set as high as possible and he thinks we have not set it quite high enough. I am afraid that at the moment we can only agree to differ on that point. I was grateful to the hon. Member for his tribute to my predecessor and also for the recognition he made of our endeavours in this Bill to help the widowed mother.

The next Amendment is a slightly peculiar one. The widowed mother's allowance includes the allowance for the first child. As the allowance for the first child is 30s., this would mean that the increase which the hon. Gentleman proposes for the widow herself would, after taking 30s. off 105s., again be an increase of 7s. 6d., the same amount as the hon. Gentleman suggested for the widow's allowance. There is no direct relationship between that transitional payment and any addition that might be suggested for a widowed mother. Although one recognises the particular position of a widowed mother, without fairly cogent reasons it would be difficult to depart from the general principle of the same flat-rate benefit all round, which is incorporated in the widowed mother's allowance. The widowed mother's allowance consists of the basic rate, plus 30s. for the child.

The hon. Gentleman said that the house still has to be the same house. As I indicated on Clause 2, the conception of maintaining a basic rate of 26s. free of the earnings rule for widowed mothers, all of whom are presumably potential earners, was in recognition of the fact that the house still has to be the same house. In other words, what we are trying to do is to add on to the allowances for the children, which are unaffected by earnings, a contribution to the expenses incurred in maintaining a home for the children. It forms part of that whole conception.

Dr. King

I appreciate that. It is a real contribution to the widowed mother who goes out to work, because no matter what she earns she is now keeping 26s. Part of my case was that the same sort of consideration should lead the Minister to make a similar allowance to the widowed mother who cannot go out to work.

Mr. Macpherson

This would conflict in a way with, for example, the unemployed widower who is looking after children. No particular allowance is paid for him either. It is difficult in a matter of this kind to depart from the standard rate benefit. We have not thought it proper to do so on this occasion.

The hon. Gentleman suggested that we should adhere for the widow's pension to the amount proposed for the single standard benefit in the last Amendment and introduce a£4 widow's pension. Again it seems to be rather difficult to depart from the overall standard benefit rate without a good deal more consideration.

The hon. Gentleman suggested a full-scale inquiry into widowhood. This is a suggestion which has come from other parts of the House. This is something we are bearing in mind. Very careful consideration has to be given to the timing of inquiries of this kind. I will take very careful note of what the hon. Gentleman has said, but I must advise the Committee not to accept the Amendment.

9.0 p.m.

Miss Herbison

The main burden of the Minister's case is that in all the matters which were raised so well by my hon. Friend the Member for Southampton, Itchen (Dr. King) it is a question of judgment. We have recently disposed of many Amendments on which we attempted to raise the basic rate for many people. We were rather afraid that those Amendments would be rejected by the Government. It was perhaps particularly for that reason that we wished to have these Amendments discussed, because they apply only to widows.

The Minister said that no cogent reason has been given why the widowed mother's allowance should be raised by 7s. 6d. or why the widow's allowance for the first 13 weeks should be raised by that amount. Anyone who has examined the question of widowhood must have come to the conclusion that these widows need much more financial assistance than they are getting.

The additional 7s. 6d. for which we are asking may not necessarily be the right figure. We felt, however, that it might be the highest amount we could now get from the Government. The figure of 7s. 6d. is by no means sacrosanct and we had to use our judgment; and the Minister referred to this in terms of it being a matter of judgment. We have been told that we must consider the feelings of society in these matters and that sometimes, if the feeling is strong enough, the Government might be influenced. Surely the Minister must know that feeling in the country on this topic is very strong? If we cannot help all the categories of those who receive benefit, at least we should try to help more than we have the widows, particularly the widowed mothers.

The Minister said that we cannot depart from the basic rate without full consideration. He must be aware that time and again a special case has been made out for the widow. In view of that, the Government should themselves have given this subject special consideration. The Minister referred us to the 26s. which the widowed mother will be allowed to keep and the right hon. Gentleman said that that was in recognition of the fact that even on the death of her husband she would still have to maintain the house in which her children live. But 26s. will not go far if the widow and her children are in a house which is highly rented or is being bought on a mortgage.

Great difficulties are placed on widows, particularly on widowed mothers, who are doing all they can to give their children what both parents in other instances are able to provide for theirs. So although we are glad that the 26s. is to be left—and we wanted a much better provision in our previous Amendments—we still do not think that the position, particularly of the widowed mother, is, as we would want it to be today.

It is no use the Minister saying that we cannot depart from the basic rate without giving the matter full consideration. I emphasise again that that consideration should have been given some time ago and that the small increase for which we are asking over and above that proposed by the right hon. Gentleman is the minimum we consider these people should receive. We would have thought that even if he could not accept the previous Amendments he would have accepted this one which deals with a special class of widow. We shall return to this matter in the future, until these widows, particularly the widowed mothers, get the justice that is long overdue. Because the Minister's response has been unsatisfactory, we intend to divide the Committee.

Question put, That "95 0" stand part of the Schedule:—

The Committee divided: Ayes 182, Noes 152.

Division No. 43.]	AYES	[9.5 p.m.
Agnew, Sir Peter	Elliott,R.W.(Nwcastle-upon-Tyne,N.)	Legge-Bourke, Sir Harry
Aitken, W. T.	Emery, Peter	Lilley, F. J. P.
Allason, James	Farr, John	Linstead, Sir Hugh
Ashton, Sir Hubert	Fell, Anthony	Litchfield, Capt. John
Awdry, Daniel (Chippenham)	Finlay, Graeme	Loveys, Walter H.
Barter, John	Fraser, Ian (Plymouth, Sutton)	Lucas-Tooth, Sir Hugh
Batsford, Brian	Gammans, Lady	McAdden, Sir Stephen
Baxter, Sir Beverley (Southgate)	Gibson-Watt, David	McLaren, Martin
Beamish, Col. Sir Tufton	Gilmour, Ian (Norfolk Central)	McLean, Neil (Inverness)
Bell, Ronald	Gilmour, Sir John (East Fife)	McMaster, Stanley R.
Bidgood, John C.	Goodhart, Philip	Macmillan, Maurice (Halifax)
Biffen, John	Goodhew, Victor	Macpherson,Rt.Hn.Niall(Dumfrles)
Biggs-Davison, John	Gower, Raymond	Maitland, Sir John
Bishop, F. P.	Green, Alan	Marshall, Douglas
Bourne-Arton, A.	Gresham Cooke, R.	Marten, Neil
Box, Donald	Grosvenor, Lt.-Col. R. G.	Matthews, Gordon (Meriden)
Braine, Bernard	Gurden, Harold	Mawby, Ray
Brewis, John	Hamilton, Michael (Wellingborough)	Maxwell-Hyslop, R. J.
Brooke, Rt. Hon. Henry	Harris, Frederic (Croydon, N.W.)	Maydon, Lt.-Cmdr. S. L. C.
Bullard, Denys	Harris, Reader (Heston)	Miscampbell, Norman
Burden, F. A.	Harvey, Sir Arthur vere (Macclesf'd)	Moore, Sir Thomas (Ayr)
Campbell, Gordon (Moray & Nairn)	Harvey, John (Walthamstow, E.)	More, Jasper (Ludlow)
Carr, Compton (Barons Court)	Hastings, Stephen	Morrison, John
Clark, Henry (Antrim, N.)	Hay, John	Mott-Radclyffe, Sir Charles
Clarke, Brig. Terence(Portsmth, W.)	Heald, Rt. Hon. Sir Lionel	Neave, Airey
Cleaver, Leonard	Henderson, John (Cathcart)	Nicholson, Sir Godfrey
Cooke, Robert	Kill, Mrs. Eveline (Wythenshawe)	Osborn, John (Hallam)
Cooper, A. E.	Hill, J. E. B. (S. Norfolk)	Osborne, Sir Cyril (Louth)
Cordeaux, Lt.-Col. J. K.	Hocking, Philip N.	Page, John (Harrow, West)
Costain, A. P.	Holland, Philip	Pannell, Norman (Kirkdale)
Coulson, Michael	Hopkins, Alan	Pearson, Frank (Clitheroe)
Courtney, Cdr. Anthony	Hornsby-Smith, Rt. Hon. Dame P.	Percival, Ian
Crosthwaite-Eyre, Col. Sir Oliver	Howard, John (Southampton, Test)	Peyton, John
Curran, Charles	Hughes Hallett, Vice-Admiral John	Pickthorn, Sir Kenneth
Currie, G. B. H.	Hughes-Young, Michael	Pilkington, Sir Richard
Dalkeith, Earl of	Iremonger, T. L.	Pitt, Dame Edith
Dance, James	Irvine, Bryant Godman (Rye)	Pott, Percivall
Deedes, Rt. Hon. W. F.	James, David	Powell, Rt. Hon. J. Enoch
Digby, Simon Wingfield	Johnson, Dr. Donald (Carlisle)	Prior, J. M. L.
Donaldson, Cmdr. C. E. M.	Johnson, Eric (Blackley)	Prior-Palmer, Brig. Sir Otho
Doughty, Charles	Johnson Smith, Geoffrey	Proudfoot, Wilfred
Drayson, G. B.	Jones, Arthur (Northants, S)	Pym, Francis
du Cann, Edward	Kirk, Peter	Quennell, Miss J. M.
Duncan, Sir James	Langford-Holt, Sir John	Rawlinson, Sir Peter
Eden, John	Leavey, J. A.	Redmayne, Rt. Hon. Martin
Elliot, Capt. Walter (Carshalton)	Leburn, Gilmour	Rees, Hugh
Roberts, Sir Peter (Heeley)	Tapsell, Peter	Vaughan-Morgan, Rt. Hon. Sir John
Robinson, Rt. Hn. Sir R. (B'pool,S.)	Taylor, Edwin (Bolton, E.)	Vickers, Miss Joan
Rodgers, John (Sevenoaks)	Taylor, Frank (M'ch'at'r, Moss Side)	Wakefield, Sir Wavell
Royle, Anthony (Richmond, Surrey)	Teeling, Sir William	Wall, Patrick
Russell, Ronald	Temple, John M.	Wells, John (Maidstone)
Sharpies, Richard	Thatcher, Mrs. Maragaret	Williams, Dudley (Exeter)
Shaw, M.	Thomas, Sir Leslie (Canterbury)	Williams, Paul (Sunderland, S.>
Sheet, T. H. H.	Thompson, Sir Kenneth (Walton)	Wilson, Geoffrey (Truro)
Smith, Dudley (Br'ntf'd & Chiswick)	Thornton-Kemsley, Sir Colin	Wise, A. R.
Smyth, Rt. Hon. Brig. Sir John	Tiley, Arthur (Bradford, W.)	Wolrige-Gordon, Patrick
Speir, Rupert	Touche, Rt. Hon. Sir Gordon	Woodhouse, C. M.
Stevens, Geoffrey	Turner, Colin	Worsley, Marcus
Stoddart-Scott, Col. Sir Malcolm	Turton, Rt. Hon. R. H.
Storey, Sir Samuel	Tweedsmuir, Lady	TELLERS FOR THE AYES:
Studholme, Sir Henry	van Straubenzee, W. R.	Mr. Peel and Mr. MacArthur.
Summers, Sir Spencer	Vane, W. M. F.
NOES
Abse, Leo	Griffiths, Rt. Hon. James (Llanelly)	Pentland, Norman
Ainsley, William	Hamilton, William (West Fife)	Popplewell, Ernest
Allen, Scholefield (Crewe)	Hannan, William	Prentice, R. E.
Awbery, Stan (Bristol, Central)	Harper, Joseph	Price, J. T. (Westhoughton)
Bacon, Miss Alice	Hayntan, F. H.	Probort, Arthur
Barnett, Guy	Henderson, Rt.Hn.Arthur(RwlyRegis)	Pursey, Cmdr. Harry
Beaney, Alan	Herbison, Miss Margaret	Redhead, E. C.
Bence, Cyril	Hill, J. (Midlothian)	Rhodes, H.
Bennett, J. (Glasgow, Bridgeton)	Holman, Percy	Roberts, Albert (Normanton)
Blyton, William	Holt, Arthur	Roberts, Goronwy (Caernarvon)
Boardman, H.	Hooson, H. E.	Robertson, John (Paisley)
Bottomley, Rt. Hon. A. G.	Houghton, Douglas	Robinson, Kenneth (St. Pancras, N.)
Bowen, Roderic (Cardigan)	Howell, Charles A. (Perry Barr)	Rodgers, W. T. (Stockton)
Braddock, Mrs. E. M.	Howell, Denis (Small Heath)	Ross, William
Brockway, A. Fenner	Hughes, Emrys (S. Ayrshire)	Short, Edward
Broughton, Dr. A. D. D.	Hughes, Hector (Aberdeen, N.)	Silverman, Julius (Aston)
Brown, Thomas (Ince)	Hynd, H. (Accrington)	Silverman, Sydney (Nelson)
Callaghan, James	Hynd, John (Attercliffe)	Skeffington, Arthur
Carmichael, Neil	Jay, Rt. Hon. Douglas	Slater, Mrs. Harriet (Stoke, N.)
Castle, Mrs. Barbara	Jeger, George	Slater, Joseph (Sedgefield)
Cliffe, Michael	Jones, Dan (Burnley)	Small, William
Collick, Percy	Janes, Elwyn (West Ham, S.)	Smith, Ellis (Stoke, S.)
Corbet, Mrs. Freda	Kelley, Richard	Sorensen, R. W.
Craddock, George (Bradford, S.)	Key, Rt. Hon. C. W.	Soskice, Rt. Hon. Sir Frank
Cullen, Mrs. Alice	King, Dr. Horace	Spriggs, Leslie
Dalyell, Tam	Lawson, George	Steele, Thomas
Davies, G. Elfed (Rhondda, E.)	Lee, Frederick (Newton)	Stewart, Michael (Fulham)
Davies, Ifor (Gower)	Lee, Miss Jennie (Cannock)	Stones, William
Davies, S. O. (Merthyr)	Lever, L. M. (Ardwick)	Swain, Thomas
Deer, George	Lewis, Arthur (West Ham, N.)	Taverne, D.
Dempsey, James	Loughlin, Charles	Taylor, Bernard (Mansfield)
Diamond, John	Lubbock, Eric	Thomas, George (Cardiff, W.)
Dodds, Norman	MacColl, James	Thomas, Iorwerth (Rhondda, W.)
Driberg, Tom	McKay, John (Wallsend)	Thompson, Dr. Alan (Dunfermline)
Dugdale, Rt. Hon. John	McLeavy, Frank	Thornton, Ernest
Ede, Rt. Hon. C.	MacMillan, Malcolm (Western Isles)	Tomney, Frank
Edwards, Rt. Hon. Ness (Caerphilly)	MacPherson, Malcolm (Stirling)	Wade, Donald
Edwards, Robert (Bilston)	Manuel, Archie	Wainwright, Edwin
Edwards, Walter (Stepney)	Mapp, Charles	Warbey, William
Evans, Albert	Mason, Roy	Weitzman, David
Fernyhough, E.	Mcndelson, J. J.	Whitlock, William
Finch, Harold	Millan, Bruce	Wilkins, W. A.
Fitch, Alan	Milne, Edward	Williams, Ll. (Abertillery)
Fletcher, Eric	Mitchison, G. R.	Williams, W. R. (Openshaw)
Foot, Dingle (Ipswich)	Morris, John	Williams, W. T. (Warrington)
Forman, J. C.	Moyle, Arthur	Willis, E. G. (Edinburgh, E.)
Fraser, Thomas (Hamilton)	Neal, Harold	Woof, Robert
Galpern, Sir Myer	Noel-Baker, Francis (Swindon)	Yates, Victor (Ladywood)
George, LadyMeganLloyd(Crmrthn)	Oswald, Thomas
Gourlay, Harry	Paget, R. T.	TELLERS FOR THE NOES:
Grey, Charles	Parker, John	Mr. Irving and Mr. McCann.
Griffiths, David (Rother Valley)	Peart, Frederick

9.15 p.m.

Miss Herbison

I beg to move, in page 12, line 24, at the end, to insert: 6. Widow's basic pension payable by virtue of the National Insurance (Pensions, Existing Beneficiaries and Other Persons) (Transitional) Regulations, 1948. 20 0/—/—/—. We need not spend much time on this Amendment. On Friday, 25th January, my hon. Friend the Member for Brixton (Mr. Lipton) made a very strong case, which we on this side of the Committee felt was unanswerable, to have the basic pension payable to the 10s. widow increased. I wish to stress as shortly as possible the need for the increase. In 1948, widows in that category were granted the 10s. pension as one of the transitional benefits. If in 1948 it was considered that 10s. was a fair amount to give them, by no stretch of the imagination can it be said that they should not have an increase. We are not asking for a large increase; only that the 10s. be increased to 20s. When we consider the rise in the cost of living and we recall all the arguments that have been made at the Dispatch Box both yesterday and today, the case for our Amendment has been made conclusively. There is, possibly, a case for a higher increase than the 10s. for which we ask.

Some of these women, who struggle to work when they can get it—in areas like mine, many of them simply cannot get it—pay almost the whole of the 10s. as their insurance contribution to ensure that when they reach the age of 60 they will have a pension in their own right.

It is strange that whenever a Bill of this nature is before us the Government resist this kind of Amendment. When there was time to develop the case on 25th January, they again resisted what we wanted to do. As the Minister himself said, however, the Government have not been able to give any cogent reason why this simple increase should not be given to these widows.

When she replies, the Joint Parliamentary Secretary will say that some widows have less need. We are thinking, however, of the vast majority of the 10s. widows who are in the older category. Our concern is for them. Even if it would mean giving to others whose need is not as great, I am all in favour of giving an increase so that the vast majority who are in difficult circumstances get this little increase for which we ask.

Mr. Sydney Silverman (Nelson and Colne)

I do not propose to detain the Committee for more than two or three minutes at most and I have not previously intervened in these debates. I support my hon. Friend the Member for Lanarkshire, North (Miss Herbison) in her Amendment. It is not a great Amendment. It would not alter the position very much, it would not put all the anomalies and injustices right, it would not put the widows concerned in the same position as other people are in and as they should be, but it would at least do something.

I do not want to debate the technical difficulties. I do not consider them quite as insuperable as is sometimes made out, but, undoubtedly, they exist. I remind the hon. Lady the Joint Parliamentary Secretary of what the right hon. Member for Woodford (Sir Winston Churchill) used to say about much greater difficulties during the war. He used to say that if a matter was difficult, we would do it at once and that if it was impossible, it might take a day or two longer. I am perfectly certain that, given the will, there is sufficient ingenuity and technical skill in the Department to find a way of overcoming the difficulties.

These people are not in a trade union. They cannot withhold their labour because they live by their labour. They cannot cause difficulties. There are not many of them. Each year, their number grows smaller. They will not affect the result of an election, either a by-election or a General Election. If the Whips were to be taken off for this one occasion during the Committee stage of the Bill, does the hon. Lady doubt that 80 to 90 per cent. of hon. Members would vote for the Amendment? The country would rejoice at it. Even those who do not benefit by it would rejoice; indeed, perhaps they would be pleased most of all.

The present position is inhuman. It is unjust. It is anomalous. Public opinion does not support it. Parliamentary opinion does not support it. It is not difficult to put right. Why in the world do not the Government take their courage in their hands and bring this nonsense to an end?

Mr. Ernest Popplewell (Newcastle-upon-Tyne, West)

I hope that the Parliamentary Secretary will look at the matter again and not give it the brush-off, saying that it is impossible, that this arrangement has gone on for a long time, that these widows are in a privileged position inasmuch as they receive the 10s. when they are out at work.

Let us consider again the background to this proposal. It was found expedient, when we drafted our National Insurance Act, to continue the 10s. to these people, and, therefore, that 10s. has continued all these years. I think that there can be no section of the community which has not, during the intervening years, had a rise. The Minister cannot justify this by saying that these widows are receiving the 10s. and working. That is a threadbare argument to use today, having regard to the steep increases in costs which have taken place.

There are not many of these widows, and their number is diminishing. The total expenditure involved would be well worth while. I hope that the hon. Lady will not feel bound by instructions to say that she must reject the Amendment. If she cannot give us a promise now or cannot accept the Amendment at this stage, will she assure the Committee that the Government will consider the matter again and see whether it is possible to make the adjustment in another place?

Mr. S. Silverman

Now.

Mr. Popplewell

My hon. Friend says "Now". I am making allowances. The Parliamentary Secretary is to reply, and, perhaps, a Parliamentary Secretary has not quite that power. What I am concerned to do is to press the hon. Lady to do something for this small band of very worthy people.

Mr. Victor Yates (Birmingham, Ladywood)

I do not apologise for returning to this matter again. We recently debated it in the House, and I expect that we shall have the same arguments put against it tonight. It is a human problem. There are only 85,000 people involved. During the previous debate, I told the House of letters which I had received from a number of widows who were in great distress. I shall not go over that again, but I do not consider that an adequate answer was given by the Minister.

Do the Government really appreciate the pain and distress which comes to a widow who is excluded from the normal pension and is given the 10s.? Let me quote a letter which I recently received from a widow in Birmingham. She says: I lost my husband in December, 1953, and if only he had lived for a further three months I should have received the full pension of£2 17s. 6d. As it is, I pick up the large sum of 10s, per week less 8s. 9d. stamp (which has to be paid whether I am working or not to enable me to qualify for my full pension at 60) leaving me with 1s. 3d. per week. This pension was fixed over twenty years ago, and it has not been revised at all. Here is a widow who has to pay 8s. 9d., or 8s. 8½d. to be precise, for the stamp out of her 10s. pension. She tells me that she worked through the war years and has paid National Insurance since she was 16. Her husband also paid it. She has had nervous exhaustion, blood pressure and has been constantly under the care of the doctor. This is an Amendment which should not be brushed off with technical answers, which is all that we have been given so far.

There are other cases, some of them heartrending. One widow explained to me that over the years she has struggled to try to obtain a living by taking in lodgers. Then her health gave way. Another has done her best for her children, and two of them have done very well at school. When they are 18, her National Insurance pension comes to and end and anything extra they get comes out of the 10s. She is still trying to do her best for her children, who have not yet finished their education.

I wholeheartedly support the Amendment. The hon. Lady the Parliamentary Secretary ought to understand more than most about the plight of women. What argument can she advance against this Amendment, apart from saying that if the Government do this for some they will have to do it for others? As I have said before, the anxiety of these women is worse now than it was even a few months ago. The money which she saves if she does not have to pay 8s. 9d. for the stamp is no more than the cost of a hundredweight of coal. The suffering of these women is simply enormous. I am tired of hearing answers such as those we have heard in the past. I hope that the hon. Lady will say something new and will at least give us some hope that this matter will be further examined and that some increase will be made.

Mr. Eric Lubbock (Orpington)

I did not intend to intervene in this debate, because there are many other hon. Members who can put the case for the 10s. widow much more eloquently than I can, but I wish to take up a point made by the hon. Member for Newcastle-upon-Tyne, West (Mr. Popplewell). He pointed out that this 10s. pension has not been increased since it was first awarded.

I should like the Parliamentary Secretary to tell us—in fact, I challenge her to tell us—in terms of 1963 values, how much 10s. is worth now compared with when this pension was first instituted so that we can see by how much its value has fallen.

9.30 p.m.

Mrs. Thatcher

The hon. Lady the Member for Lanarkshire, North (Miss Herbison) was kind enough to point out that we spent a long time debating this issue a few days ago, and, therefore, was also kind enough to be brief in moving the Amendment. The hon. Lady and I are both in a difficult situation. Each of us is convinced absolutely by our own arguments, but neither is able to convince the other.

May I put my case for the view of the Government why we cannot increase the 10s. pension, at any rate for the time being; in fact, why we cannot increase it at all. Perhaps I might ask the hon. Lady if she could help me before I embark upon my reasoning. The Amendment which is in her name refers only to 10s. pensions in payment in 1948. Perhaps she would say whether that is what she intends, or if she intends to refer to all 10s. pensions.

Miss Herbison

All 10s. pensions.

Mrs. Thatcher

The great majority have come into payment since 1948. This Amendment refers only to those which were in payment at the time. Perhaps I may use that as a starting off point.

A great change came over the National Insurance Scheme at about that time. The position with regard to this particular group of pensions then in payment was this: those widows then receiving the 10s. pension, who would have qualified for a widow's pension or a widowed mother's pension had they been widowed under the terms of the new scheme—that is to say, those who, at the time they had the 10s, pension in 1948, had children, or were over 50 and sick—would have got a pension under the new scheme. Those automatically got the rise from 10s. to 26s. as it then was, and they have had successive increases since.

The hon. Lady, I know, is well aware of these facts, but a number of hon. Members are not and there are a number of people in the country who are not. It gives a wrong impression when people say that the 10s. widow's pensions in payment in 1948 have never been increased. That is not entirely true, because those who would have qualified under the new scheme straight away got an increase because they had children or because they were old and sick.

That left in receipt of the 10s. pension people who, under the new scheme, would have got nothing at all because they were widowed when they were under 50 or had no children. Under the new scheme they would only have got the 13 weeks bereavement grant which now, under the new Bill, would amount to£61 15s. taking the total over the 13 weeks, and after that nothing else, and they would have had to keep up their contributions for retirement pension.

The comparison is between the person who got 10s. and her modern sister who, in identical circumstances, would have got nothing. By far the great majority of these pensions have come into payment since 1948. They are payments made to women whose husbands contributed under the old scheme and who were married to those husbands before 1948. But I must point out that that scheme went out of existence, and the contributions under that specific scheme went out of existence at the same time, so no premiums for this particular pension under this scheme have been paid for fifteen years, although new awards have been coming into payment during those fifteen years and are still this year coming into payment to women who are widowed under circumstances that would not have entitled them to anything under the new scheme.

Dr. King

I am sure that the hon. Lady wants to be fair. The husbands of these ladies paid their proper contributions under the old Health Insurance Scheme as long as it existed, and they paid their contributions under the new one as long as they lived. The benefits that were promised them in 1926 when they began to pay are the benefits that we are talking about.

Mrs. Thatcher

I do not think that there is any substantial disagreement between the hon. Gentleman and myself. There are two schemes, the National Insurance Scheme and the old Widows' Pension Scheme—two lots of contributions, one for the old Widows' Pension Scheme, which gave the 10s. widow's pension, and one for the National Insurance Scheme which gave no pension under circumstances which I have described. When we dropped the old scheme, naturally contributions terminated under the old scheme and there were only contributions for the benefit of the new scheme. So there is no difference between what the hon. Gentleman and I are saying.

People who are entitled under this are people whose husbands paid a minimum of 104 contributions of a few pence a week under the old scheme. There was no minimum period of marriage at all under the old scheme. What I am trying to get across to the hon. Gentleman is that because the scheme went out of existence premiums have not been paid for fifteen years although all of the benefits of it have been preserved. I hope I have made myself clear and I hope I have not wasted the time of the Committee in drawing that distinction.

Dr. King

The hon. Lady will agree that this is important. Their husbands paid under the 1926 scheme which gave those ladies as of right, if their husbands died, 10s. a week. When the old scheme perished and the new scheme was substituted their rights did not go. They got 10s. as of right. We are questioning the value of it.

Mrs. Thatcher

May I point this out to the hon. Gentleman? Their rights were not only preserved, but we have had the transitional period of fifteen years already and there is no end of it in sight at all because some other people whose benefits are now coming into payment may have derived them from the minimum number of contributions. I do not complain about that at all, but the scheme being extinct the premiums have not been kept up although the benefits have.

Miss Herbison rose—

Mrs. Thatcher

I do not want to labour the point too long. I hope that I have made myself clear. I will give way to the hon. Lady.

Miss Herbison

The hon. Lady is making very great play about not a single contribution coming in to meet these pensions since 1948. It seems that the whole basis of her case is that one cannot raise this 10s. because of that. If that is the basis of her case and we follow it to its logical conclusion we come to the old people who were retired in 1948 They were getting 10s. a week pension, and we immediately increased it to 26s. Some of those old people will still be living today, and when there is an increase they get an increase. It does seem to me that one cannot possibly put up a case against the widows when we compare them with the old people. And, thank heaven, that case was never put against the old people.

Mrs. Thatcher

Apart from the specific case which the hon. Lady mentioned, apart from the five-year option period which we now have for old people, their pension had already come into payment. The only difference between that scheme and the new scheme is what I call the five-year option retirement period. But we are not discussing old-age or retirement pensions. We are discussing widows' pensions. It only appears to the hon. Lady that I am putting too much play on this case, although I have tried to make myself clear in response to the hon. Gentleman the Member for Southampton, Itchen.

If one looks at it on a rather different benefit basis and one compares the old 10s. widow with her modern sister who would not get anything under the new scheme, one finds this transpires. If a person is widowed now and is under 50 and childless, then, unless she has the old reserved right, she will get just the grant of£61 15s. in weekly amounts for 13 weeks. If she happens to have a reserved right under the old scheme she will probably get that grant because she will have been insured under the new scheme as well. When that period ends she will be entitled to 10s. till she becomes 60. If she is 45 when widowed she will receive, in payments of 10s.,£390 apart from bereavement grant—£390 more than her sister would get under the new scheme.

If she is a widow of 40 she would get a sum of£520. For a widow of 35 the sum is£650. That is very much to her advantage over her modern sister, but I should point out that these sums under the new awards are now paid out of the National Insurance Fund supported by the contributions of people not entitled to this particular benefit.

Those are our main reasons for saying that we cannot accede to the hon. Lady's request in the Amendment. As I have pointed out, the Amendment would not do what she seeks to achieve.

The Chairman

Mr. Bence.

Mr. S. Silverman

Before the hon. Lady sits down, may I ask one question? I suggested in my short intervention that if the Whips were taken off there would be a clear decision on this. The hon. Lady has made a case. I do not deny that. It is rather an administrative, bureaucratic, actuarial case—some people would call it a third-class insurance company case—but it satisfies her and I am not complaining. As there is this complete opposition of administrative view, would she not consider letting the House of Commons in Committee decide this matter according to its own conscience and judgment, without involving in it confidence in the Government? Let us have a vote on this with the Whips off and see how many hon. Members are for the Amendment.

The Chairman

Order. The Commit tell will have noticed that I called the hon. Member for Dunbartonshire, East (Mr. Bence). The hon. Member for Nelson and Colne (Mr. S. Silverman) interposed, saying "Before the hon. Lady sits down". That would have been all right for a short question, but not for a considered speech. Mr. Bence.

Mr. Cyril Bence (Dunbartonshire, East)

In the twelve years that I have been in the House of Commons I have heard many times the statement that it is the desire of both sides that in granting social benefits to different sections of the community we shall increase those benefits in such measure that the increasing prosperity of the country shall be shared by all sections. However, listening to this debate and previous debates, it seems to me that an exception is made of certain widows. Apparently all widows in Britain shall have all sorts of things done for them—except the ones we are talking about.

I cannot understand this. Even last night I supported hon. Gentlemen opposite in their plea on behalf of widows who will suffer some loss as a result of events in Egypt in 1956. I have heard splendid pleas for those widows. Tonight we are making a plea for the most impoverished section of our community, the widows who are receiving only the 10s. pension—

Mrs. Thatcher

They are not the most impoverished section, as the hon. Gentleman would know if he had read the speech of my right hon. Friend on this subject on 26th January.

Mr. Bence

Am I to believe that the prosperity of certain sections of the community is based on the speeches of right hon. and hon. Gentlemen opposite? If I believed the things I heard from those benches, I should believe anything. I would say from my experience that those who suffer widowhood are very often the most unfortunate people in the country at that time. It is tragic for a woman to be widowed. It is a very unfortunate circumstance for a working-class woman with a growing family to be widowed.

I am shocked that we should have got from a Minister, as my hon. Friend the Member for Nelson and Colne (Mr. S. Silverman) rightly said, the sort of thing I should have got if I had claimed from an insurance company, which is concerned with commercial practice and preserving its financial stability and profit. We have had almost exactly the same answer from a Minister in respect of this small section of the community.

I hope that my right hon. and hon. Friends will divide on this matter and that the people at large will realise just how mean the Government are towards the working-class widows, in contrast with their attitude to widows with property or shares, as expressed through the Rent Act and other Measures. They have used such Measures to help, so they claimed, widows who have property and shares. But for the 10s. widow they do nothing.

9.45 p.m.

Mr. McKay

I congratulate the Joint Parliamentary Secretary on her logical argument and lawyer-like explanation. It does not follow, however, that we accept her judgment, or the judgment of her advisers, for maintaining the present position. I always understood that any Government could overcome technicalities. I have always understood that this Parliament cannot be tied indefinitely to whatever technical arguments may be put up against a course which it wishes to follow. It follows, therefore, that if we think it wise that widow's incomes should be increased, then the technicalities must be changed if they stand in the way.

The hon. Lady argued the case for keeping things as they are on the ground that other widows have been dealt with in a certain way. But that way is itself not very satisfactory to the Labour movement. If the Government judged that things should be changed, they would change them. The only thing standing in the way is the Government's refusal to overcome the technicalities. The hon. Lady's argument was weak, dependent purely on technicalities without judging the position either morally or socially.

The provision that a widow should be 50 before she could get a pension if her family was above the dependency limit was based on a bad argument. It is ridiculous that a widow who has raised a family for whom she has received dependants' allowances should lose all her allowances when her family reaches the age limit and she becomes 50 years of age.

It is said that to make this change would make it very difficult to refuse comparable concessions to young widows of 20 or 25. But we are here concerned with women who have gone through a trying time raising a family during a long period of widowhood. That is a bad argument. The technical difficulties can be overcome if the will is there.

I appeal to the spirit of the Conservative Party, regardless of the numbers involved, to consider the moral argument for the change which we propose. These widows always have been entitled to receive 20s. Practicallly every National Insurance beneficiary has received increases in benefit as the years have gone by. However, as the country's economic circumstances have changed there has been no change in the financial position of these widows.

The Government's present view is unjust. It is for hon. Members opposite to bring moral pressure to bear to see that the treatment of these women is brought into line with that accorded to other sections of the community.

Mr. Donald Wade (Huddersfield, West)

This 10s. was granted in recogni- tion of an anomaly when the present scheme was first introduced in 1948. The anomaly applied both to those who became entitled to 10s. in 1948 and those who have come into benefit since.

Dr. King

It is not an anomaly. It is a right. Their husbands paid for it.

Mr. Wade

I will not argue about that. I agree that it could be regarded as a right.

The Government's view is simply that, because Governments have refused an increase for many years, they are bound by previous statements and must continue to say, "No". That is the gist of the Government's case. Surely the fairest solution is that suggested by my hon. Friend the Member for Orpington (Mr. Lubbock)? Calculate the real money value of 10s. when it was first decided on.

Dr. King

1926.

Mr. Wade

I would settle for 1948. I shall not argue whether it should be 1926 or 1948. Calculate the value as at 1948, and increase it so that there will not be any fall in real money terms. Failing that, if the Minister is so unwilling, so reluctant, to depart from the case that has been put from that Bench so many times, may I suggest another way out which would go some little way to meet the sense of hardship felt by these 10s. widows?

Why not credit them with the contribution which they are now having to pay out of the 10s.—I think that it is 8s. 9d.—until they become entitled to a pension under the new scheme? That, I think, would go some way towards meeting the very real feeling of injustice of which I know the Minister is aware.

Mr. B. T. Parkin (Paddington, North)

It would be impertinent to presume that the Minister and the Parliamentary Secretary have not studied with great care every part of this Bill, but the House and the Committee have not discussed in great detail every part of it, and in relation to the hon. Lady's speech I want to refer to Clause 6, because this is the Clause which appears in all Bills of this kind, and which no one wishes to discuss at the time.

The Chairman

Order. The hon. Member is aware that we are discussing an Amendment to Schedule 2. Schedule 2 has nothing to do with Clause 6.

Mr. Parkin

You will be aware, Sir William, that the hon. Lady developed at some length an actuarial argument against the Amendment in terms of funds and contributions and all the rest of it. What I desire to point out is that although it may be convenient to discuss the balance of payments in and out from stamps to benefits and so on, although it may be convenient to assess from time to time what benefits can be borne by the National Insurance Scheme, the moment of truth is in Clause 6 which appears in every one of these Bills, where it says: There shall be defrayed out of moneys provided by Parliament… It never says, "There shall be paid out of moneys paid in by contributors, by widows, by husbands, by people before they were sick", and every time in this moment of truth—

The Chairman

Order. I am sorry to interrupt the hon. Member, but this is not the right and proper occasion to develop the argument he is now making.

Mr. Parkin

But, with respect, Sir William, at the other end of this Clause there is a similar statement: There shall be paid into the Exchequer any sums falling to be so paid in consequence of this Act. The contributions are paid into the Exchequer. It is clear—and I appreciate your suspicion that one could on the basis of this develop a very wide argument indeed attacking the whole myth—

The Chairman

Order. It is for just that reason that I hope the hon. Member will not on this Amendment go further. We are discussing a very restricted Amendment. I can read it out for the hon. Member if it is not before him. The Amendment is in Schedule 2, page 12, line 24, at end insert: 6. Widow's basic pension payable by virtue of the National Insurance (Pensions, Existing Beneficiaries and Other Persons) (Transitional) Regulations, 1948. 20 0/—/—/—. That figure is to be in place of 10s. The hon. Member cannot stray into a full-dress debate on the whole principle of that Bill.

Mr. Parkin

I was about to explain, Sir William, that I had no such intention. I was attempting to reply to the hon. Lady's assertion that there was something wrong with this 10s. situation because there had been no corresponding sum paid into any fund to sustain it. I hope you will agree that in reply to that argument I am entitled to quote two phrases from this common Clause 6. Where we may for convenience discuss what payments have been paid in and paid out, it is only a good help to get this sense of balance in this Fund. It is only a convention but it is a myth. Nobody believes that there is actuarial control of the Fund. Nobody in the Government believes it. Nobody in his heart believes it.

It being Ten o'clock, The CHAIRMAN left the Chair to report Progress and ask leave to sit again.

Committee report Progress.