Clause 1.—(AMENDMENTS AS TO CONTRIBUTIONS AND BENEFITS UNDER INSURANCE ACT. 1963 c. 7. 1959 c. 47.)

HC Deb 03 December 1964 vol 703 cc764-855

3.58 p.m.

Lord Balniel (Hertford)

I beg to move Amendment No. 1, in page 2, line 2, at the end to insert: (3) In section 6 (1) of the National Insurance Act 1959 (which provides for increases in retirement pensions for contributions paid after pensionable age) for the words "one shilling" where they first occur there shall be substituted the words "one shilling and sixpence" and for the word "sixpence" where it last occurs there shall be substituted the words "one shilling". This Amendment is designed to increase the increments which a person can earn by postponing his retirement after pensionable age and by continuing to pay contributions while at work. The concept of earning increments on one's pension through continuing at work after pensionable age and paying contributions every week has been an integral part of our National Insurance scheme since its inception. It was an integral part of the Beveridge Report and it was an integral part of the first of the post-war National Insurance Acts.

During the period preceding the National Insurance Act, 1959, a person who continued in employment after pensionable age earned for himself an increment of 1s. 6d. on his pension for every 25 contributions which he made. At that time, there were frequent complaints that this period of 25 weeks was excessive. A man often had to retire for reasons of ill-health after, say, 23 or 24 weeks had passed, and he felt, with a certain amount of justification, that, after such a long period had passed, he was entitled to an increment. In fact, he received nothing, and it was often felt that he had been cheated out of the increment for which he had paid over a period and that all his effort had been wasted.

In 1959, a change was, therefore, made and the increment was earned after 12 weeks instead of after 25 weeks. The situation today stems from what was then laid down in 1959. For every 12 contributions paid a person who has postponed his retirement earns for himself an additional 1s. a week on his retirement pension when he ultimately takes it. There are similar provisions for a married person. A married person earns on behalf of his wife, provided that she is over 60 years of age—I know that this is a feature of the scheme which the Chancellor of the Duchy of Lancaster dislikes intensely—an additional 6d. a week on the pension after he has made 12 contributions.

As the Committee knows, there is a limit on the number of increments which can be earned on one's pension. One cannot go on earning increments after reaching 70 years of age. Expressing a personal opinion, I hope that the right hon. Lady, when she institutes her review of the whole structure of National Insurance, will look again at this limitation on the earning of increments after 70 years of age. I do not myself see the logic of encouraging a man to continue in employment and earn increments on his pension up to the age of 70, but removing that encouragement immediately he attains 70 years of age. I regard this as one of the features which could be looked at in the general review of the scheme.

As a result of this limitation on the amount of increment one can earn, the position since 1959 has been that the absolute maximum increment which can be earned by a single person is 21s. a week on the pension and by a married person 31s. 6d. At the time when these increments were fixed by the National Insurance Act, 1959, the flat-rate pension for a single person was 50s. Under this Bill, the flat-rate pension for a single pension will be raised from 67s. 6d. to 80s. a week, an increase of 60 per cent. over the flat-rate pension for a single person in 1959.

While there has been this increase of 60 per cent. in the flat rate for a single person, the Bill makes no attempt to increase the increments, leaving them exactly where they were fixed under the 1959 Act. Exactly the same is true for a married person. In 1959, the flat rate pension for a married person was 80s. a week. It is now being raised from 109s. to 130s., and this is an increase of 62 per cent. over the 1959 figure. There is no provision in the Bill for increasing the increment in a way commensurate with the increase in the flat-rate pension.

Thus, as a result of a sequence of increases in the flat-rate pension, the increase made in 1961, the increase made in 1963, and the present increase being made by the Bill, the increments which a man can earn have become a steadily diminishing proportion of the flat-rate pension, and, not only that, but their actual value in real terms has been steadily eroded by the rise in the cost of living. Moreover, the whole Committee expects that, as a result of the inflationary twist which has been given to the economy in the past few weeks, there will be a further substantial rise in the cost of living during the coming year.

By the Bill, the Government are to make a substantial increase, which we all welcome, in the flat-rate pension for single and married persons, but I should have expected them to regard as one of the priorities on which to concentrate attention the need to restore the relative value of the increments to the value fixed by the 1959 Act instead of allowing it to fall, as will occur under the Bill.

The increments not having been increased, my understanding is that a man must now live to at least 90 before he will even get a full return on the contributions which he has made. The right hon. Lady will be able to correct me if my amateur mathematics are incorrect.

Mr. A. E. Hunter (Feltham)

Could the noble Lord tell me when the increments were last increased?

Lord Balniel

If the hon. Gentleman had listened to a word of my speech, he would realise that I have said on several occasions that the increments were increased by the National Insurance Act, 1959, and I am suggesting that the time has come for a further increase to be made.

Mr. Hunter

Why did not the last Government increase them before now? We appealed to them to do so.

Lord Balniel

Will the hon. Gentleman do me the courtesy of listening to my speech?

The Amendment is deliberately framed as an exceedingly modest one, and I am putting it to the Minister in the genuine hope that she will find it possible to accept our very moderate proposal. We are proposing no more than to restore the relative value of the increments as determined by the 1959 Act. In 1959, the 1s. which could be earned after 12 contributions was 2 per cent. of the 50s. pension fixed under that Act. We propose by the Amendment that this increment should be increased to 1s. 6d. for a single person. This will be marginally less than 2 per cent. of the new 80s. pension for a single person.

In 1959, the 1s. 6d. increment for a married person was marginally less than 2 per cent. of the 80s. pension for a married person. We propose by the Amendment a 2s. increment for a married person, and this would be marginally less than 2 per cent. of the new 130s. pension. The right hon. Lady, who has studied the Amendment, will have realised that we have placed a greater degree of emphasis on helping the married person. This is in conformity with the policies which were pursued by the late Administration, of giving additional help to dependents.

The absolute maximum increment which would be earned by a single person under the Amendment is 31s. 6d. and the absolute maximum increment for a married person would be 52s. 6d. The cost of this Amendment in the short term would be slight, but in the long term it would be a significant factor. I wish to thank the right hon. Lady for her courtesy in so promptly replying to a question of mine which sought to ascertain the cost which would be involved by this Amendment. The cost of increasing the increments as proposed for a single person would be about £250,000 during the next financial year and, in the long term, over a five-year period, it would rise to £25 million. The cost of increasing the increments for a married man would be £50,000 during the next financial year rising to £4 million in 1970–71.

I quite accept that there is an argument against increasing the increments. Professor Cairncross, in his minority Report to the Phillips Committee, actually proposed the abolition of the increments, but in doing so he put forward alternative suggestions which involved abolition of the retirement condition altogether and abolition of the earnings rule. Those who dislike the increments as a feature of the National Insurance Scheme say, with a certain amount of justification, that the increments do not provide much incentive for a person to stay on at work after he has reached pensionable age.

This certainly was the view of the Phillips Committee in 1959. In paragraph 201 of its Report it said: A small prospective increase in the pension later on, though welcome when it comes, can seldom affect the decision". That is the decision whether or not to retire. I quite accept that the decision which a man or woman makes on reaching the age of 65 or 60 whether to retire or not is primarily governed by that person's health, by the habits of his lifetime, by the sharp drop in income which follows on retirement, and by such intangible factors as the happiness and contentment which he gets from continuing at work.

The dominating factor, quite clearly, is not the increments. None the less, they are a factor which is taken into account. I quite accept that the increments are not the dominating factor in the decision whether to retire or not, but I—and certainly the last Administration—felt that the structure of National Insurance should be framed so as to give some encouragement to people who wish to go on working to continue to do so. We feel that our social policies should be directed, not, of course, towards forcing a man to continue at work after his strength or health has failed, but to encourage those who wish to continue in employment to do so. Certainly, we should not discourage people who want to continue in employment from doing so.

4.15 p.m.

I quote from paragraph 201 of the Phillips Committee's Report. Referring to the increments, it said: They may have little effect as an incentive to postpone retirement but they are a well-known feature of the National Insurance Scheme and if they were removed or materially reduced"— Those are significant words— we should expect the public reaction to this change to be seriously unfavourable to the success of the steps now being taken to facilitate and promote voluntary postponement of retirement. The Government are not reducing this in actual terms, except that it is being reduced in real terms through the rise in the cost of living, but it is this reduction which is actually occurring in practice—

The Joint Parliamentary Secretary to the Ministry of Pensions and National Insurance (Mr. Norman Pentland)

The noble Lord keeps referring to the rise in the cost of living. Would he tell us what increase in the cost of living is taking place at present?

Lord Balniel

If the hon. Gentleman thinks that the rise in petrol tax will not have any effect on the cost of living, he is living in the dream world in which the entire Government seem to be seeking shelter.

Mr. Pentland

The noble Lord is trying to build a case on increases in the cost of living, or expected increases in the cost of living. Will he present any evidence as to the percentage increase he expects, or which he thinks is now present?

Lord Balniel

There certainly has been an increase in the cost of living since these increments were last fixed.

Mr. Michael Foot (Ebbw Vale)

Under the noble Lord's Government.

Lord Balniel

The hon. Member is entitled to interrupt, but if he thinks that this is a proper field in which to make party political points that is his opinion.

Mr. Charles Loughlin (Gloucestershire, West)

The noble Lord's Government were in office for 13 years.

Lord Balniel

The hon. Gentleman asked me to say whether there has been a rise in the cost of living. If the Government proceed in the manner in which they have proceeded so far, a sharp twist to the inflationary spiral is an absolute certainty for the country.

Mr. Michael Foot

All that the noble Lord was asked by my hon. Friend the Parliamentary Secretary was a simple question: what was the percentage of increase expected? It was a perfectly simple question. He does not need to "go off the deep end" about it.

Dame Irene Ward (Tynemouth)

Is the hon. Member opposite aware that in so far as the—

The Chairman

Order. We cannot have these three-cornered questions. If the hon. Lady wishes to ask a question of her own Front Bench she may do so, but we cannot have three-cornered discussions.

Lord Balniel

The Amendment proposes to compensate for the rise in the cost of living which has occurred since 1959—the rise which the right hon. Lady herself referred to in her memorandum presented to Parliament recently. I am not Professor Balogh or Mr. Kaldor. Obviously, I cannot prognosticate what the rise in the cost of living will be, but I think it reasonable for us to try to help these pensioners to have increments which will help to compensate for the rise which has occurred since 1959 and try to insulate them against a future rise in the cost of living.

These increments have not been increased in the last three successive National Insurance Acts. They have been materially reduced as a proportion of the pension received by retirement pensioners. They have also been materially reduced in real purchasing power as a result of the rise in the cost of living. People will say, "What is the point of my continuing to work and to pay substantially increased contributions under the Bill when the increments are not increased commensurately?"

There increments have also been reduced as a proportion of average earnings in the country. Average earnings in 1959, when the increments were last fixed, were 261s. 10d. Today, they are 352s. 5d. One has a general picture which has developed under successive insurance Measures and the present Insurance Bill. Contributions have gone up and the increments form a smaller proportion of the pension, a smaller proportion of average earnings, and they have been reduced in actual earning power.

There is another very significant argument for increasing the increments. When the Report was written, in 1959, the Phillips Committee thought that the trend towards earlier retirement had been halted and actually reversed. While the Report was being written, the Government Actuary was also writing his second quinquennial Report. The Government Actuary at that time assumed that 45 per cent. of all men in this country would retire immediately they reached the age of 65.

In the last few days we have been presented with the third quinquennial Report of the Government Actuary. This shows that that assumption made in 1959 was a false one. The Government Actuary, in 1959, assumed that 45 per cent. of men would take up the pension immediately on reaching the age of 65. In fact, in 1959 the proportion was 47 per cent. In 1960, it was 45 per cent.; in 1962, 53 per cent.; and in 1963 54 per cent. So the trend during the last five years, as shown by the Government Actuary, has been towards people steadily retiring earlier and earlier.

The arguments for increasing the increments are twofold. There are the humanitarian arguments and the economic arguments. To my mind, the humanitarian arguments are the dominating ones in reaching a decision on this matter, but, of course, economic arguments are not totally insignificant. The economic arguments are that the country needs all the people, of whatever age, who are fit, willing and anxious to continue in work, to do so. The greater the number of elderly persons who continue in employment, the smaller the burden which is borne by the rest of the community.

Consequently, one can place greater emphasis on helping those in greatest need, the elderly, the chronic sick, widowed mothers and those receiving other benefits directed specifically to those in need. I believe that it is widely agreed in the Committee that all people who are fit, anxious and able to continue at work in their own interests should be encouraged to do so. To continue in employment is for elderly people often a very important emotional and psychological need. They feel a sense of satisfaction in maintaining their independence. They maintain a higher standard of life.

Mr. Thomas Swain (Derbyshire, North-East)

Would the noble Lord agree that one of the main reasons why, over the last 13 years, people have stayed at work beyond the age of 65 was that the miserable pensions doled out by the Tories were not sufficient to live on?

Lord Balniel

I am sure that the marked drop in income which follows retirement is a factor. It would be folly to pretend that it was not. But it is also true that people are retiring early partly because of the failure of successive insurance schemes to increase increments as they should be increased. It is very important for elderly persons that they should be able, and encouraged, to continue at work to maintain this sense of independence and self-respect which many of them believe to flow directly from continuing employment.

Several Hon. Members rose—

The Chairman

I hope that we shall not have too many interruptions. There are many Amendments with which to deal and this is only the first.

Lord Balniel

Our social policies ought positively to encourage people to continue in employment if they feel inclined to do so. I regret that one of the features of the present Bill is that the increments are of steadily diminishing importance. The Amendment is designed modestly to restore the increments to the relative value at which they were fixed in 1959.

Mr. A. E. Hunter

I want the basic pension eventually to be so increased that a person can retire at a proper standard of living. The noble Lord the Member for Hertford (Lord Balniel) wants to encourage people not to retire so that that can save the Government money. That is not the policy of the Labour Party. If the Labour Government stay in power long enough, I am confident that we will eventually get a proper basic pension for the man at 65 and the woman at 60. At the same time, if someone is fit and wants to continue work, then the increment should be increased.

The noble Lord said that the last time it was increased was in 1959, which means that the last Government did nothing for five years. With a change of Government, hon. Members opposite now come forward with this policy. I am in favour of increasing the increments and I know that my right hon. Friend will bear in mind the desirability of doing so. However, we want to be honest in politics and not press for one thing in opposition and then do something different when in power. For five years the last Government did nothing to increase these increments. I am in favour of increasing them and I hope that my right hon. Friend will consider the matter.

4.30 p.m.

Lieut.-Commander S. L. C. Maydon (Wells)

I support the Amendment. The right hon. Lady has introduced a Bill with which we are all very much in sympathy. However, she has left a number of gaps in it and it is our object to try to fill one of them. Although benefits are to go up generously, the right hon. Lady is proposing to leave the level of the increments precisely as they have been for some time. She is giving the man who defers his retirement a very bad bargain and the State an unwarrantably good bargain.

Let us consider the case of a single man forgoing his pension for the full span of time from 65 to 70. That is roughly 260 contribution weeks and the maximum increment which he can earn on the present scale is 21s., that is to say, those 260 contribution weeks divided into blocks of twelve. However, during that time, if the scales of benefit proposed in the Bill are introduced, he will forgo 260 payments of £4 a week, a total of £1,040. He will also pay at the standard rate of contribution on his own account 13s. 8d. a week on the new scales, a total over the five years of £177 13s. 4d.

We have also to consider the employer's contribution—because this is money which the State is obtaining one way or another—and, at 26s. 7d. a week, that will give a total of both types of contribution over the five years of £345 11s. 8d. The single man who defers his retirement for the full five years will, therefore, make the State better off by £1,385 11s. 8d. Before he breaks even on that bargain, he will have to live until he is more than 95.

Mr. Cyril Bence (Dunbartonshire, East)

This has been going on for years.

Lieut.-Commander Maydon

I am well aware of this. If the hon. Gentleman will turn up HANSARD for 3rd February, 1956, he will see that I then made a speech on these lines. I should like to tell him that then, with a Conservative Government, the figures were nothing like so unfavourable as it is proposed to make them under a Socialist Government. What is more, in 1959 something was done to put the matter right, not enough, but something. The hon. Gentleman should be more careful about sorting out his facts before intervening.

With the new proposed benefits for himself and his wife, assuming that she is of pensionable age, too, the married man will get £6 10s. a week. If that is forgone for five years, that gives a total of £1,690. The contributions will be the same, assuming that only the man is contributing, and the State will, therefore, benefit to the tune of £2,035 11s. 8d. As a married man he will get an additional increment on account of his wife and will not have to live quite so long as the single man to break even—only until he is just over 94, assuming that his wife is alive, too. If she predeceases him, he will have to live longer to break even.

Our proposal would go some little way to improving this state of affairs for the single man and would go further for the married couple. I commend the Amendment to the right hon. Lady. If she cannot give a definite answer this afternoon, I hope that she will look at these figures, which I believe to be tolerably correct. I am not all that accurate in my arithmetic, but I do not think that my figures are all that wrong and I hope that the right hon. Lady will give the Amendment serious and sympathetic consideration.

Mr. Eric Lubbock (Orpington)

Can the hon. and gallant Gentleman tell the Committee how long the single man and the married man respectively would have to live in order to get back their contributions if the increments were raised to the levels proposed?

Lieut.-Commander Maydon

Yes. We propose that for the single person it should be 31s. 6d. instead of 21s. As that is adding an extra half, in simple terms it would take about two-thirds of the time. The same applies to the married man. If an extra half is added to the incremental benefit, the time taken to break even on the figures I have quoted would be roughly two-thirds of the time now taken.

Mr. Pentland

I am aware that many arguments can be used in an attempt to justify increases in increments. We have all been aware of that for many years. The noble Lord the Member for Hertford (Lord Balniel) referred to some of them on which I shall touch as I go along. In her speech on Second Reading last Wednesday, the hon. Lady the Member for Finchley (Mrs. Thatcher) advanced two arguments for increasing the rates of increments. Today, the noble Lord has more or less filled in the pattern of what the hon. Lady would expect her arguments would achieve.

First, it is clear that while increments have always been related to the amount of pension forgone, increment rates have not been increased since 1959, although pension rates have gone up on three occasions since then. The hon. Lady and the noble Lord will be aware that increments do not, and were never intended to, provide a full actuarial return for the extra contributions paid and the extra benefits forgone during the deferment of retirement. I understand from my study of this subject in the short time that I have been at the Ministry that all Governments in the past have followed the concept laid down in the Beveridge Report.

Paragraph 246 of the Beveridge Report says: The increases for postponement after minimum pensionable age are designed to give the individual some, though not all, of the saving in pension expenditure resulting through his postponement and are related, therefore, to the amount of the basic pension which is postponed. If we are to discard the concept of Beveridge—and the Amendment would probably lead us to that conclusion—and accept that a full actuarial return should be given, there would be no ultimate saving to the National Insurance Fund by the postponement of retirement. As a consequence, the whole purpose of helping to provide a higher rate of benefit for those who had ceased work would be destroyed.

I know that comparisons and examples can be given about the percentage the prevailing maximum increment rate is of the pension rate, but too much weight should not be given to those comparisons, because the rate has fluctuated so much since 1948. Everyone in the Committee is aware of that, and that increment rates have never been increased as frequently as pension rates. Indeed, since 1948 there has been little connection at all between the timing of an increase in benefit rates and an increase in increment rates.

I think that I am right in saying that the two increases coincided on only one occasion, and that was in 1951. The benefit increases made by previous Conservative Governments in 1952, 1955, 1958, and 1961 were not accompanied by increases in increment rates. The 1959 increment increase which was referred to by the hon. Gentleman was made independently of other benefit changes at that time.

The second point which the hon. Lady deployed in her speech on Second Reading, and it was deployed by the hon. Gentleman today, was that an increase in increment rates was needed to give an extra incentive to defer retirement. This was one of the main planks of his argument. I would accept at once, as would my right hon. and hon. Friends on this side of the Committee, that increments provide extra income for the later years of life when it is most likely to be helpful to retirement pensioners, hut, here again, I do not think that the incentive argument should be over stated, and it was not, or at least not too much, by the hon. Gentleman.

The hon. Gentleman referred to the Phillips Committee, which, he claimed, reported in 1959. Actually, that Committee reported in 1954. There was another Committee which also reported in 1954 and I am sure that the hon. Lady, with her knowledge of the Department, is aware of that Report. The inquiry was conducted by the Ministry of Pensions in 1953. It was an inquiry into the reasons for retiring or continuing at work, and it was found that fewer than 1 per cent. of men who stayed on at work after reaching the minimum pension age gave increments as the main reason for doing so.

4.45 p.m.

As the hon. Gentleman said, men are attracted to work by financial considerations. It depends on the jobs available, on the salary or wage which the individual can earn, and on the man's ability to continue in work when he has reached retiring age. Another important factor, of course, is the opportunity to work, and this can vary considerably from one part of the country to another. In Durham, it is extremely difficult for a man over 65 to continue in work, even though he may have the ability to do so, because of the unemployment problem. I accept that this state of affairs is not as prevalent in the Midlands or in the South as it is further North. However, there are these differences.

My hon. Friend the Member for Derbyshire, North-East (Mr. Swain) was correct when he intervened during the speech of the hon. Gentleman. I do not believe that when a man is nearing 65 he wants to continue working because he likes doing so. He may be interested in, and enjoy, his job but the vast majority of those who work in heavy industries continue to do so because in their view, and in the view of this side of the Committee, the pension is not sufficient for them to live on. The real answer to all these problems which face the retirement pensioner when he is reaching retirement age is to provide him with a substantial pension during the years of his retirement This is exactly what we on this side of the Committee hope to bring forward in the years ahead.

The Amendment raises other complications to which I could refer if hon. Members desired me to do so, but I must make it clear, to save the time of the Committee, that the Government do not consider that this is the appropriate time to increase these increments. We believe that any change at this stage might complicate the wider task of reconstructing the benefit and contribution structure of the whole scheme, and the merging of existing rates into any new scheme which the Government may bring forward.

We see great dangers here, in the light of any new scheme which we may bring forward in the future. But, having, said that, I must point out that we will continue to keep these rates under sympathetic consideration. Hon. Gentlemen opposite should make no mistake about that. We have by no means closed our minds to the importance of increment rates.

Mr. A. P. Costain (Folkestone and Hythe)

To assist us to assess this, could the hon. Gentleman say when such legislation is likely to be brought in?

Mr. Pentland

Not at this stage. If the hon. Gentleman is patient, it will come along in due course.

Lord Balniel

I appreciate that the hon. Gentleman may not be able to say when further legislation will be brought in. One of his main arguments against accepting the Amendment is that it will complicate the future structure which is being considered by the review. Can he tell us when he expects to know the result of the review?

Mr. Pentland

I could not do that, as the hon. Gentleman knows full well. This is a complicated business, and I am sure that anyone who has served in the Ministry knows that this is a terrific job. The point is that we are embarking on an investigation into the whole structure. After giving consideration to the matter, we have found that the increment question has complications if one takes the whole structure of the scheme into consideration.

The Committee knows that there are other methods by which one can improve the increments. I am not saying that this will be done. I am saying that if there were any alteration of the flat-rate provision it would probably be preferable to effect an improvement by altering the number of contributions which earn 1s., as has been done in the past. We could do it this way, rather than by altering the value of the increment earned for every twelve contributions.

I do not want to deceive the Committee. These thoughts are running through our minds. I am not saying that this will be done immediately. I am only trying to impress on the Committee that there are other methods which we could use, without delving into the complicated one suggested in the Amendment. These are matters for the Government to decide, but, in the meantime, I repeat that we will give this our full consideration.

We cannot accept the Amendment, for the reasons which I have given, and for many more which I could give. If the Amendment is not withdrawn, I invite the Committee to reject it in the Division Lobby.

Lieut.-Commander Maydon

There are two questions arising out of the answer which the hon. Gentleman has just given. He claimed, quite rightly, that these increments in the past had not normally been increased at the time when there had been increases in the standard rates, but does he not recognise that there comes a time when the standard rates of benefit get widely out of step with the increments, and that something must be done? We are trying to impress upon him and his right hon. Friend that this is such a time.

On his second point, he quoted the 1953 Report as saying that of those who were interviewed a very small percentage claimed that the increment for deferred retirement had any influence in making them defer their retirement. Would he not recognise that if the increments had been rather more generous, a greater percentage might have given a favourable answer?

Mr. Pentland

I cannot accept that. I have said that, in our view, this is not the time. Between 1959 and 1964 his Government had the opportunity to put this matter right had they wanted to. We say that this is not the time. The hon. and gallant Gentleman was in the Department. Perhaps the hon. and gallant Gentleman would remind me of his second point?

Lieut.-Commander Maydon

It was about the small percentage who claim that the increment had no influence in making them defer retirement.

Mr. Pentland

This is hypothetical. The hon. and gallant Gentleman's guess is as good as mine. All I was pointing out is that this was an extensive inquiry by the Ministry of Pensions into the reasons for retiring or continuing at work and it resulted in only 1 per cent. of the people approached saying that the increment rates were an attraction.

Mr. Bernard Taylor (Mansfield)

From the speeches that we have heard from the benches opposite two things emerge. The hon. and gallant Member for Wells (Lieut-Commander Maydon), who was a Parliamentary Secretary in the last Administration, made out his case on an actuarial basis. The noble Lord the Member for Hertford (Lord Balniel) based his case on very different reasons. I do not dispute the hon. and gallant Gentleman's figures. I am sure that they must be correct, but this matter has gone on since 5th July, 1948, and during that time we have had 13 years of Conservative Government. It comes with some cynicism and ill-grace for the hon. and gallant Gentleman to advance now the argument on an actuarial basis which he has put forward for an increase in the increments.

Lieut.-Commander Maydon

If the hon. Gentleman had been here, and had listened to my reply to an intervention by one of his hon. Friends, he would know that I answered that point. It was on 3rd February, 1956, that I produced precisely the same arguments. The figures were different, but the arguments were the same, and I am glad to say that three years later the Conservative Government took heed of what I said and made a considerable improvement.

Mr. Taylor

May I say to the hon. and gallant Gentleman that I have been here all the time and listened both to his speech and that of the noble Lord the Member for Hertford. I heard what he said to my hon. Friend the Member for Dunbartonshire, East (Mr. Bence), but the fact remains that men over 65 and women over 60 who decide and have the opportunity to stay at work—I shall come to that in a moment—are entitled to increments. All that he said about the actuarial basis has continued since 1948 and 13 years of that period have been under a Conservative Administration. As I sat here I came to the conclusion that it comes with some cynicism and ill-grace from the hon. and gallant Gentleman.

In considering the actuarial question, I am relying on the promise of my right hon. Friend, given during the Second Reading. I am also reminded of the speech that my right hon. Friend the Chancellor of the Duchy of Lancaster made during the debate on the Gracious Speech. He said that this Measure was a rescue operation. It was to meet need where it was most sorely felt. My right hon. Friend the Minister made the same comment. Both intimated that this is only a short-term Measure, that the whole structure of National Insurance will be reviewed, and that at a not too distant date we shall have the proposals before us.

I turn for a moment to the speech of the noble Lord the Member for Hertford and ask him a question which I tried to put to him in an intervention. He seemed to base his case entirely on the supposition that if the increments were increased it would be an inducement to people to go on working. The point that I want to make—my hon. Friend the Parliamentary Secretary made it as well—is that in these days of mechanisation and automation in industry people arriving at the age of 65, however willing and desirous they may be of continuing to work, have no option.

In the industry which I know best there is compulsory retirement at 65. I would say to the noble Lord that the argument which he adduced for an increase in increments is a very weak one, because the pattern of behaviour in retirement, over which the people themselves have no control, has considerably changed.

I hope that my right hon. Friend the Minister, in rejecting this Amendment, will look at the question of increments in the light of changing circumstances in industry with regard to retirement and will come forward with some constructive proposals when the time arrives.

Mr. Costain

I want to intervene for only a few moments because I was so disappointed with the reply of the Parliamentary Secretary. My appreciation of the Amendment, which I thought was most reasonable and very well proposed by my hon. Friend the Member for Hertford (Lord Balniel), is based on the fact that the pension scheme itself, if taken to its conclusion, is a pension scheme payable at 70 with the option to retire at 65 should people so desire.

The Parliamentary Secretary, as a good trade unionist, has always taken the view, on which I support him, that the rate for the job is the proper pay, but I think that in this case, if we do not increase increments between 65 and 70, we are taking advantage of the person who wishes to work after 65.

That I very much resent. The argument whether a man or woman should work on after this period is almost irrelevant. I have talked to a number of pensioners in my constituency, and many of them say that they would like to work on after the age of 65 because they cannot bear being in the house when the "old woman" is cleaning it out. Some of them are very grateful for being able to get away. But that is no reason why we should underpay them for the job.

The argument that these increments should not rise on every occasion when there is an increase in pensions can easily be shot down. When we are dealing with marginal fractions, those fractions come into their own only when there have been a number of increases which catch up with the fractions. I believe that after the Conservative Government have given many pension increases this is the occasion when the increment should rise. This is a chance for the Labour Government to catch up with their conscience. This is an opportunity for them to do the right thing. If they reject the Amendment they will be doing the wrong thing.

5.0 p.m.

Mrs. Margaret Thatcher (Finchley)

When the Parliamentary Secretary was replying I took the view at first that he was not in favour of the increment system at all. I was, therefore, somewhat relieved when he said later that he would give the matter sympathetic consideration. The increment system is an essential part of the National Insurance Scheme.

I can put the case quite simply, in the way in which it was put in the Beveridge Report, from which the Parliamentary Secretary quoted. Paragraph 246 says, in referring to increases for postponement after reaching minimum pensionable age, that the increases for increments are related therefore, to the amount of the basic pension which is postponed. The hon. Gentleman quoted that as being some compensation, although not all, for the amount of benefit which is forgone. In other words, if a man goes on working after he could have retired, and, therefore, goes on paying contributions, he gets an increased pension when he retires. That increased pension does not make up for what he did not draw earlier, although it is considerably greater than the basic rate.

If, therefore, we accept that the increments are related to the amount of the basic pension which is postponed, the longer the period that has elapsed since the increments were put up the more urgent it is that they should be put up. I accept that the basic rates have been increased only twice since the inception of the scheme—once in 1951 and once in 1959—because the compensation has been changed less often than the basic rate, for reasons to which my hon. Friend has referred.

There have been other changes in increments, the last of which was as recently as 1961, when changes were made in incremental provisions for wives and widows. I rest my case on the principle enunciated in the Beveridge Report and repeated by the hon. Member, that increments are related to the amount of the basic pension which is postponed. This is the third rise in basic pensions since increments were changed, and it is time that we had some increase in the amount of increment. I therefore

ask the Committee to accept the Amendment.

The Minister of Pensions and National Insurance (Miss Margaret Herbison)

The hon. Lady is now quite clearly making the case that every time there is an increase in pensions—

Mrs. Thatcher

No.

Miss Herbison

Perhaps the hon. Lady will allow me to take up her points one by one. She quoted from the Beveridge Report, as did my hon. Friend the Parliamentary Secretary, to the effect that there should be some relationship between the increments and the amount of pension forgone. But what she was really saying, in logic—although she may not think she was saying it—was that every time there is an increase in the basic pension there must be an increase in the increments.

If that is the case my hon. Friend the Member for Mansfield (Mr. Bernard Taylor) was quite right to say that we have had 13 years of Tory rule and that from 1951 right up till 1959, in spite of various increases in the basic rate of pension, there was no increase at all in the increments. In 1959 an increase was given. There have been two increases under the previous Administration since 1959.

Again, I come back to the logic of the hon. Lady's case. According to her there should have been an increase in the increments in 1961 and 1963, but no increase was given. I stress, as my hon. Friend has stressed, that we decided that this was not the time to make an increase in the increment. My hon. Friend made it quite clear that in the general review of all social security provisions which is to take place this matter will receive serious consideration. I hope that when we go to the Division Lobbies, as it looks as if we shall, the Amendment will be over-whelmingly defeated.

Question put, That those words be there inserted:—

The Committee divided: Ayes 169, Noes 207.

Division No. 26.]	AYES	[5.8 p.m.
Alison. Michael (Barkston Ash)	Batsford, Brian	Biggs-Davison, John
Allason, James (Hemel Hempstead)	Beamish, Col. Sir Tufton	Bingham, R. M.
Amery, Rt. Hn. Julian	Bell, Ronald	Black, Sir Cyril
Anstruther-Gray, Rt. Hn. Sir W.	Bennett, Sir Frederic (Torquay)	Blaker, Peter
Balniel, Lord	Bennett, Dr. Reginald (Gos & Fhm)	Bowen, Roderic (Cardigan)
Barlow, Sir John	Biffen, John	Boyd-Carpenter, Rt. Hn. J.
Braine, Bernard	Gurden, Harold	Noble, Rt. Hn. Michael
Brewis, John	Hall, John (Wycombe)	Nugent, Rt. Hn. Sir Richard
Brinton, Sir Tatton	Hall-Davis, A. G. F.	Onslow, Cranley
Brooke, Rt. Hn. Henry	Harris, Frederic (Croydon, N.W.)	Orr-Ewing, Sir Ian
Brown, Sir Edward (Bath)	Harris, Reader (Heston)	Osborn, John (Hallam)
Buck, Antony	Harrison, Col. Sir Harwood (Eye)	Osborne, Sir Cyril (Louth)
Bullus, Wing Commander Sir Eric	Harvey, John (Walthamstow, E.)	Page, R. Graham (Crosby)
Burden, F. A.	Hastings, Stephen	Percival, Ian
Butcher, Sir Herbert	Hawkins, Paul	Pickthorn, Rt. Hn. Sir Kenneth
Butler,Rt.Hn.R.A.(Saffron Walden)	Hay, John	Pitt, Dame Edith
Campbell, Gordon	Heald, Rt. Hn. Sir Lionel	Prior, J. M. L.
Carlisle, Mark	Heath, Rt. Hn. Edward	Pym, Francis
Carr, Rt. Hn. Robert	Hendry, Forbes	Quennell, Miss J. M.
Channon, H. P. G.	Hiley, Joseph	Redmayne, Rt. Hn. Sir Martin
Chataway, Christopher	Hill, J. E. B. (S. Norfolk)	Rees-Davies, W. R.
Chichester-Clark, R.	Hirst, Geoffrey	Rodgers, Sir John (Sevenoaks)
Cooke, Robert	Hobson, Rt. Hn. Sir John	Roots, William
Cooper, A. E.	Hogg, Rt. Hn. Quintin	Royle, Anthony
Cordle, John	Hordern, Peter	Russell, Sir Ronald
Corfield, F. V.	Hornby, Richard	Sharpies, Richard
Costain, A. P.	Hornsby-Smith, Rt. Hn. Dame P.	Sinclair, Sir George
Courtney, Cdr. Anthony	Howard, Hn. G. R. (St. Ives)	Smith, Dudley (Br'ntf'd & Chiswick)
Crawley, Aidan	Hutchison, Michael Clark	Smyth, Rt. Hn. Brig. Sir John
Crosthwaite-Eyre, Col. Sir Oliver	Irvine, Bryant Godman (Rye)	Spearman, Sir Alexander
Cunningham, Sir Knox	Jennings, J. C.	Stanley, Hn. Richard
Curran, Charles	Johnston, Russell (Inverness)	Taylor, Edward M. (G'gow, Cathcart)
Dalkeith, Earl of	Jones, Rt. Hn. Aubrey (Hall Green)	Taylor, Frank (Moss Side)
Dance, James	Kerby, capt. Henry	Thatcher, Mrs. Margaret
Dean, Paul	Kerr, Sir Hamilton (Cambridge)	Thompson, Sir Richard (Croydon,S.)
Donaldson, Cmdr. C. E. M.	Legge-Bourke, Sir Harry	Thorpe, Jeremy
Doughty, Charles	Litchfield, Capt. John	Tilney, John (Wavertree)
Drayson, G. B.	Lloyd,Rt.Hn.Geoffrey (Sut'nC'dfield)	Turton, Rt. Hn. R. H.
du Cann, Rt. Hn. Edward	Longden, Gilbert	Tweedsmuir, Lady
Eden, Sir John	Lubbock, Eric	van Straubenzee, W. R.
Emery, Peter	McAdden, Sir Stephen	Vaughan-Morgan, Rt. Hn. Sir John
Fell, Anthony	Mackenzie, Alasdair(Ross & Crom'ty)	Vickers, Dame Joan
Fisher, Nigel	Macleod, Rt. Hn. Iain	Walder, David (High Peak)
Fletcher-Cooke, Charles (Darwen)	McNair-Wilson, Patrick	Walker, Peter (Worcester)
Fletcher-Cooke, Sir John (S'pton)	Maitland, Sir John	Wall, Patrick
Foster, Sir John	Marten, Neil	Walters, Dennis
Fraser, Ian (Plymouth, Sutton)	Mathew, Robert	Ward, Dame Irene
Gammans, Lady	Mawby, Ray	Weatherill, Bernard
Gardner, Edwward	Maxwell-Hyslop, R. J.	Whitelaw, William
Gibson-Watt, David	Maydon, Lt.-Cmdr. S. L. C.	Wilson, Geoffrey (Truro)
Giles, Read-Admiral Morgan	Meyer, Sir Anthony	Woodhouse, Hn. Christopher
Glover, Sir Douglas	Mills, Stratton (Belfast, N.)	Wylie, N. R.
Glyn, Sir Richard	Mitchell. David	Younger, Hn. George
Goodhew, Victor	Monro, Hector
Grant, Anthony	Morgan, W. G.	TELLERS FOR THE AYES:
Grant-Ferris, R.	Mott-Radclyffe, Sir Charles	Mr. MacArthur and
Griffiths, Eldon (Bury St. Edmunds)	Murton, Oscar	Mr. R. W. Elliott.
Grimond, Rt. Hn. J.	Nicholson, Sir Godfrey
NOES
Allaun, Frank (Salford, E.)	Crossman, Rt. Hn. R. H. S.	Freeson, Reginald
Alldritt, W. H.	Cullen, Mrs. Alice	Garrett, W. E.
Allen, Scholefield (Crewe)	Dalyell, Tam	Garrow, A.
Armstrong, Ernest	Davies, Harold (Leek)	Ginsburg, David
Atkinson, Norman	Davies, Ifor (Gower)	Gourlay, Harry
Bacon, Miss Alice	de Freitas, Sir Geoffrey	Gregory, Arnold
Bagier, Gordon A. T.	Dell, Edmund	Griffiths, David (Rother Valley)
Barnett, Joel	Dempsey, James	Griffiths, Rt. Hn. James (Llanelly)
Bence, Cyril	Doig, Peter	Hale, Leslie
Bennett, J. (Glasgow, Bridgeton)	Donnelly, Desmond	Hamilton, James (Bothwell)
Binns, John	Driberg, Tom	Hamilton, William (West Fife)
Bishop, E. S.	Duffy, Dr. A. E. P.	Hamling, William (Woolwich, W.)
Blackburn, F.	Dunn, James A.	Hart, Mrs. Judith
Blenkinsop, Arthur	Dunnett, Jack	Hattersley, Ray
Boston, T. G.	Edelman, Maurice	Hayman, F. H.
Bowden, Rt. Hn. H. W. (Leics S.W.)	Edwards, Robert (Bilston)	Hazell, Bert
Boyden, James	English, Michael	Henderson, Rt. Hn. Arthur
Braddock, Mrs. E. M.	Ennals, David	Herbison, Rt. Hn. Margaret
Brown, Rt. Hn. George (Belper)	Ensor, David	Holman, Percy
Buchan, Norman (Renfrewshire, W.)	Evans, Albert (Islington, S.W.)	Horner, John
Buchanan, Richard	Evans, Ioan (Birmingham, Yardley)	Houghton, Rt. Hn. Douglas
Butler, Herbert (Hackney, C.)	Fernyhough, E.	Howarth, Harry (Wellingborough)
Butler, Mrs. Joyce (Wood Green)	Fitch, Alan (Wigan)	Howarth, Robert L. (Bolton, E.)
Carter-Jones, Lewis	Fletcher, Sir Eric (Islington, E.)	Howie, W.
Coleman, Donald	Fletcher, Ted (Darlington)	Hoy, James
Conlan, Bernard	Fletcher, Raymond (Ilkeston)	Hughes, Emrys (S. Ayrshire)
Corbet, Mrs. Freda	Floud, Bernard	Hughes, Hector (Aberdeen, N.)
Crawshaw, Richard	Foot, Michael (Ebbw Vale)	Hunter, Adam (Dunfermline)
Hunter, A. E. (Feltham)	Morris, Alfred (Wythenshawe)	Silverman, Julius (Aston)
Irvine, A. J. (Edge Hill)	Morris, Charles (Openshaw)	Silverman, Sydney (Nelson)
Irving, Sydney (Dartford)	Murray, Albert	Skeffington, Arthur
Jeger, George (Goole)	Neal, Harold	Slater, Mrs. Harriet (Stoke, N.)
Jeger,Mrs.Lena(H'b'n&St.P'cras,S.)	Newens, Stan	Slater, Joseph (Sedgefield)
Jenkins, Hugh (Putney)	Noel-Baker, Francis (Swindon)	Small, William
Jones, Rt. Hn. Sir Elwyn(W.Ham,S.)	Noel-Baker,Rt.Hn.Philip(Derby,S.)	Solomons, Henry
Jones, J. Idwal (Wrexham)	Norwood, Christopher	Sorensen, R. W.
Jones, T. W. (Merioneth)	Ogden, Eric	Soskice, Rt. Hn. Sir Frank
Kenyon, Clifford	Oram, Albert E. (E. Ham S.)	Spriggs, Leslie
Kerr, Mrs. Anne (R'ter & Chatham)	Orbach, Maurice	Stones, William
Kerr, Dr. David (W'worth, Central)	Orme, Stanley	Strauss, Rt. Hn. G. R. (Vauxhall)
Lawson, George	Oswald, Thomas	Stross, SirBarnett(Stoke-on-Trent,C.)
Lee, Rt. Hn. Frederick (Newton)	Owen, Will	Summerskill, Dr. Shirley
Lee, Miss Jennie (Cannock)	Padley, Walter	Swain, Thomas
Lever, L. M. (Ardwick)	Page, Derek (King's Lynn)	Symonds, J. B.
Lewis, Ron (Carlisle)	Paget, R. T.	Taverne, Dick
Lipton, Marcus	Pannell, Rt. Hn. Charles	Taylor, Bernard (Mansfield)
Lomas, Kenneth	Pargiter, G. A.	Thomas, George (Cardiff, W.)
Loughlin, Charles	Park, Trevor (Derbyshire, S.E.)	Thomson, George (Dundee, E.)
McBride, Neil	Pavitt, Laurence	Thornton, Ernest
MacColl, James	Pentland, Norman	Tinn, James
McGuire, Michael	Perry, E. G.	Tuck, Raphael
McInnes, James	Popplewell, Ernest	Urwin, T. W.
MacKenzie, Gregor (Rutherglen)	Prentice, R. E.	Varley, Eric G.
Mackie, John (Enfield, E.)	Probert, Arthur	Wainwright, Edwin
McLeavy, Frank	Pursey, Cmdr. Harry	Walker, Harold (Doncaster)
MacMillan, Malcolm	Rankin, John	Wallace, George
MacPherson, Malcolm	Rees, Merlyn	Warbey, William
Mahon, Peter (Preston, S.)	Rhodes, Geoffrey	White, Mrs. Eirene
Mahon, Simon (Bootle)	Richard, Ivor	Whitlock, William
Mallalieu, E. L. (Brigg)	Roberts, Goronwy (Caernarvon)	Willey, Rt. Hn. Frederick
Manuel, Archie	Robertson, John (Paisley)	Williams, Mrs. Shirley (Hitchin)
Mapp, Charles	Robinson, Rt.Hn. K. (St.Pancras,N.)	Williams, W. T. (Warrington)
Mellish, Robert	Rodgers, William (Stockton)	Willis, George (Edinburgh, E.)
Mendelson, J. J.	Rogers, George (Kensington, N.)	Winterbottom, R. E.
Mikardo, Ian	Rose, Paul B.	Woodburn, Rt. Hn. A.
Millan, Bruce	Ross, Rt. Hn. William	Woof, Robert
Miller, Dr. M. S.	Shore, Peter (Stepney)	Wyatt, Woodrow
Milne, Edward (Blyth)	Short,Rt.Hn.E.(N'c'tle-on-Tyne,C.)
Molloy, William	Short, Mrs. Renée (W'hampton.N.E.)	TELLERS FOR THE NOES:
Monslow, Walter	Silkin, John (Deptford)	Mr. McCann and Mr. Harper.

Mr. Paul Dean (Somerset, North)

I beg to move Amendment No. 2, in page 2, line 6, at the end to insert: Provided that in section 17(1)(c) of the Insurance Act for the word "fifty" there shall be substituted the word "forty-five".

The Temporary Chairman (Sir Leslie Thomas)

I think that together with this Amendment it would be convenient for the Committee to discuss Amendment No. 3 in page 2, line 6, at end insert: (4) Section 2(5) of the Family Allowances and National Insurance Act 1956, which amends section 18(1)(a) of the Insurance Act to provide that a widow who ceases to be entitled to a widowed mother's allowance shall not have a right to a widow's pension unless at the time when the entitlement ceases she is over the age of fifty, shall have effect as if for the word "fifty" there were substituted the word "forty-five".

Amendment No. 7, in line 39, leave out "subsection (1) or (3)" and insert "sub sections (1), (3), or (4)".

Amendment No. 17, in Schedule 5, page 16, line 9, at end insert: 15. In section 17(1)(c) for the word "fifty" there shall be substituted the word "forty-five".

Amendment No. 18, in page 17, line 12, at end insert:

The Family Allowances and National Insurance Act 1956

(4 & 5 Eliz. 2 c. 50)

20. In section 2(5), for the word "fifty' there shall be substituted the word "forty-five".

Mr. Dean

The object of this and the other Amendments is to reduce the age at which widows qualify for a permanent pension from the present age of 50 to 45. May I, first, remind the Committee of the position as it is at the moment? Widows without dependent children qualify for a permanent pension if they are widowed before the age of 50, dating from the 1946 Act, and the same applies to the widowed mother if none of her children is still dependent when she reaches the age of 50.

That dates from the Family Allowances and National Insurance Act, 1956, which was based on a previous Report by the National Insurance Advisory Committee. Before that Act, the age in the case of the widowed mother was 40. The 1956 Act was, I believe, generally acknowledged as providing a substantial improvement in the provisions for the widowed mother—a substantial increase in the benefits for her and the children, what we call the "flying start", with regard to cover for sickness, for unemployment, the entitlement to a widowed mother's allowance for children up to the age of 18 instead of the previous age of 16 and the reduction of the qualifying period of marriage from 10 years to three years.

I think that the party opposite acknowledged at the time that this was a very substantial improvement in the cover for the widowed mother, but hon. Members opposite did have reservations about the fixing of the age of 50 in the case of the widowed mother for a permanent pension. I remember the right hon. Lady the Minister, saying at that time that she felt that the age of 50 was too high, that it should be 45 or even lower. She then went on to refer to the possibility of having a sliding scale for widows' benefits.

In view of this, and of the Amendment which the party opposite moved at the time to reduce the age to 45, I am very hopeful of a sympathetic reception for this proposal from them this afternoon. I believe that there are now arguments for believing that the age of 50 is too high. There are, I believe, four main reasons for this.

The first is that a woman who finds herself widowed, say at the age of 49, or whose children just cease to be dependent at that age, very often finds it extremely difficult to get a job. Although the "flying start" is of help to her, the unemployment provision only lasts for a period of 19 months. We all know, on both sides of the Committee, of cases where there is a real difficulty for widows of the ages of which I am speaking. Even if a widow at this age succeeds in getting employment, she has to readjust herself, after perhaps a substantial number of years during which she has been caring for the home and for her family.

The third reason—and I believe that this is an immensely important one when we are dealing with an essentially human scheme like the National Insurance Scheme—is that there is a real sense of injustice on the part of these widows when they compare themselves with the pensioned widow who may be living next door. They naturally ask themselves why they should get no pension and should have to go on paying contributions until they are 60, whereas another widow who may be in similar circumstances is getting a pension. The disparity under this Clause will be even greater between the two, because, in future, the widow who is getting a pension will no longer be subject to an earnings rule. So, in this respect, the sense of injustice will be increased.

There is one further reason which, I believe, strengthens the case for a change now in the age and that is that women are marrying younger. The only age group in which the proportion of women marrying actually rose between 1956 and 1961, the last year for which I could find figures, was the under-20 group. In every other age group the number was declining. We all know this to be true. Women are marrying younger and the Government Actuary's Report on the last quinquennial review estimates that the marriage rate of the age 20 or under group will be no less than 20 per cent. greater in 1973 than it is today.

It is also interesting that it is noted in this same Report that not only are women marrying younger, but they are having their families earlier. As a consequence of this, it follows that there will be a growing number of women whose children will be grown up before they themselves reach the age of 50. We all know of the phenomenon, these days, of the glamorous grandmother. Unfortunately, many of these women will be widowed. They will be faced with the prospect of trying to get a job and of going on paying contributions until they reach the age of 60.

These, I believe, are strong arguments for reducing the qualifying age for the permanent pension to the widowed mother. I believe that we should do the same for all widows, because the principle established in the 1956 Act of a uniform age for the permanent pensions for the widow was a sound one. I know I shall be told by the right hon. Lady that I am merely creating more anomalies. It is perfectly true that the woman who becomes widowed at the age of 44 years and 11 months or whose youngest child is then grown up, will feel the same sense of grievance as many feel at the age of 50 at the moment.

Wherever one draws a hard line like this, those who are on the wrong side of the line will feel a sense of grievance. If the arguments which I have put forward up to now carry any weight, it is at any rate something to reduce the number of widows who will be on the wrong side of the line, the older ones who will find these problems much greater than the younger ones.

Another thing which I have no doubt that the right hon. Lady or the Parliamentary Secretary will say, and which we have already heard in a number of speeches opposite, is, "Why not wait until the review?" My answer to that is that the right hon. Lady herself has not waited in dealing with the Bill. She is, after all, proposing to abolish the earnings rule for widows and to increase the 10s. pension to 30s., thereby creating additional anomalies within the widows' benefit arrangements. If this can be done in these two cases, surely there is no justification for saying that one should wait for the review in this case.

I regard this as very much a holding operation to help an important group of older widows who have a sense of injustice, which will be increased by this Bill and particularly by the abolition of the earnings rule for the widow next door, who is getting a permanent pension as well. I believe that the sooner we can rethink widows' benefits and the jungle of anomalies that there are within them, the better. Both sides of the Committee are committed to doing this.

The sooner we can help more effectively those who have suffered the great loss of their husbands, the better, but until these new proposals are ready to be put into operation, surely we can do something now by reducing the age qualification for the widowed mother and the other widows.

5.30 p.m.

Miss Herbison

As the hon. Member for Somerset, North (Mr. Dean) has said, these five Amendments are aimed at substituting an age condition of 45 for the present age condition of 50, both for the widow's pension and for the transition from the widowed mother's allowance to the widow's pension. The hon. Member made reference to some remarks which I made in 1956, when the previous Administration decided to raise the age from 49 to 50 for the transition from the widowed mother's allowance to a pension, or to no pension. The remarks that I made at that time I still adhere to today.

The case made by the hon. Member for Somerset, North backs up the case which we made against the changes which were made by the Government in 1956. The first reason given by the hon. Gentleman was that a widow approaching the age of 50 finds it difficult to get a job, and that is very true. In 1956, a widow of the same age also found it difficult to get a job. His second point was that a widow close to 50 years of age found it difficult to readjust herself to a new way of life after spending many years at home caring for her family. That also obtained in 1956.

The hon. Member compared a widow receiving no pension with a widow who was obtaining a pension. I must remind him that that situation was the same in 1956. He argued that women are marrying younger and having children earlier. He made the point that children are no longer dependent on their mother and are often over 19 years of age before the mother reaches the age of 50, which means that a greater number of women are being denied a pension.

If we look at the figures we find that had the change not been made in 1956, the number of widows who would be receiving today a pension of £3 7s. 6d., or at 29th March of next year £4, is 10,000. As a result of the action of the Tory Government in 1956 they are receiving either nothing or 10s. I am glad that the hon. Member brought out all these difficulties of which we have been aware for so long.

Hon. Members on both sides of the Committee would, I think, be critical of the present age limit, and we have been critical for a very long time. They would, I think, agree that the most severe criticism may be directed against the all or nothing nature of the present provision. The hon. Member for Somerset, North drew attention to the fact that there might be a great difference in the situation of two widows who were neighbours. Were the Amendment accepted this difference would still remain and there would still exist a grave sense of injustice. It is possible today for there to be a widow, in receipt of a full pension of £3 7s. 6d., with a neighbour whose circumstances are exactly the same, the only difference being that she may be a few days younger and is, therefore, not entitled to a pension at all. That is the cause of the severe criticisms directed against the present arrangements. If the Amendment which has been moved and those which are being discussed with it are accepted there would still be this same ground for that severe criticism.

The hon. Member for Somerset, North said that their acceptance would reduce the number of widows on the wrong side of the line. It would still leave a large number with a very great sense of injustice. The hon. Gentleman observed that I might suggest that we should wait before doing anything until we have the review and he said that the very fact that the 10s. pension had been raised to 30s. had made a great difference. But it has not. In the Bill we are increasing the £3 7s. 6d. pension to £4. By regulations we proposed to increase the 10s. pension to 30s. This is to take care of the loss of value of the 10s. between 1948 and today. What we have done for the 10s. widow is completely in line with all the other matters contained in the provisions of the Bill.

Mr. Dean

I was referring to the anomaly between the 10s. or 30s. widow and the no-shilling widow.

Miss Herbison

What we are doing will not make the position any worse and there is no reason for the hon. Gentleman to suggest that we should accept these Amendments and not wait until the review.

I have tried to show that the increase from 10s. to 30s. is in line with the increases we are making by virtue of the other provisions in the Bill in all the other National Insurance benefits, sickness benefit and retirement pensions, and also in the industrial injuries benefits. On a number of occasions in the last few weeks I have tried to make clear that the age condition and the other provisions relating to benefits for widows are among what I consider to be the more important matters which we have to examine in the course of the review of social security provisions. The review will have to cover many matters, including the position of the existing widow who has failed to qualify under the present conditions. I remind the Committee that these widows number 10,000 more than would have been the case had the action taken in 1956 not been taken.

Another matter which will be given serious consideration is the substitution of a sliding scale of widows' benefits in place of the all or nothing condition. I am sure that in these modern times that is the only way to get rid of the grave injustice which exists at present.

Mr. Charles Curran (Uxbridge)

When this review takes place, will it be possible for outside organisations to give evidence, such as the National Council of Women?

Miss Herbison

Certainly. Then the review takes place, we shall be delighted to receive evidence from all those who are interested in these matters.

Another matter to which we must give consideration is the way in which widows should be treated in relation to their contribution liability and the conditions on which they may qualify for National Insurance benefits. I am sure hon. Members will agree that these are all matters of great importance and they must also agree that they are highly complicated problems. We wish to examine those problems and try to find acceptable solutions. I suggest again to the Committee that it would be prejudicial to the working out of a sensible and practicable approach to these matters if we made in isolation the one change proposed in these Amendments.

I hope that hon. Members will agree with the points which I have made and that these Amendments will be withdrawn, so that the matter may be left until the review does the job which so much needs to be done.

Dame Irene Ward (Tynemouth)

I have listened to the right hon. Lady with bewilderment. I never mind criticism of my own party. We made a tremendous amount of progress during our term of office, but I have heard her say repeatedly that this and that happened in 1956. Of course it happened in 1956, but my recollection is that the party opposite said that it was looking to the future and not to the past. Am I to understand that all that idealism of quick action to deal with all these anomalies has now flown out of the window—

Mr. Bernard Taylor

Before the hon. Lady leaves that point—

Dame Irene Ward

I have not left it.

Mr. Taylor

The hon. Lady was referring to the progress of the Conservative Administration. Did she call it progress when the age for the widowed mother was raised from 40 years to 50?

Dame Irene Ward

I will not be distracted—[Laughter.] It is no good everyone just shrieking with laughter. This may be very funny to hon. Members opposite, but not to the widows. It might be wiser if I were allowed to make my speech, though I am used to dealing with opposition from thousands, and I shall not be put off by a few hon. Members sitting on the Government benches.

I fully understand—and here I gladly reinforce what the Minister has said—that to deal with the whole range of provision for widows is a very complicated and difficult matter, but when she says that we were in power for 13 years my reply is that she and her right hon. and hon. Friends had 13 years in which to prepare their scheme against the time when they were elected to power. Certain matters can be dealt with while one is in opposition.

We were certainly led to believe during the General Election that all these plans were ready to be put into operation. Of course, it has not passed unnoticed that the whole idea of dealing with National Insurance matters has undergone a complete transformation since the Socialist Party took office, and discovered how impracticable some of its suggestions were. The country is deeply interested in these domestic matters, and the complete reversal of policy has been noticed.

It is extremely important to find out from the Minister the extent of the review. The right hon. Lady has just told my hon. Friend the Member for Uxbridge (Mr. Curran) that she and her Department would be delighted to receive representations, but will the evidence given to the review be published? That sort of review would be in line with what the Conservative Party promised, and would do much to reassure both sides of the Committee. As it is, all we hear is a reference to "when the review takes place".

Is it to be an inter-departmental review, or is it to be a departmental review? Does the right hon. Lady think that women's organisations will be satisfied with permission to send in their recommendations without the right to be heard in public? Nor will those who feel that there should be a really national public review be satisfied with a departmental review. Before we go any further with the Bill and the Amendments, I want to know exactly what the Minister has in mind about the review.

The right hon. Lady said a lot about the 10s. widow's pension being put up to 30s. She said that it was to make up for the increase in the cost of living and the fall in the value of the 10s., but what she failed to point out was that those widows who are to receive 30s. will have money to pay for their stamp in full, while the widows who do not get any money at all have to find the cost of the stamp out of their own resources. That is a very important point.

5.45 p.m.

I say quite frankly that I did not agree with my own Government on the age question—I have always been outspoken, and I shall continue to be so—but I must point out that in heavy industry areas such as those represented by the Minister and by myself, it is very difficult for women to find employment even at a younger age, but that for those who are widowed and have to try to return to work, the employment available is very small indeed.

My spirits rose when I thought that at least some of the things for which I have battled ever since I have sat in the House of Commons were to be achieved for widows. Had that been the case, I would have been quite willing to have given honour where honour was due—to the right hon. Lady and to her Government—but I find that all my ideas in that respect have gone by the board. Of course, I never really thought that the Socialist Party would implement its pledges.

The right hon. Lady spoke about the inadequacy of the machine that she inherited, but does she realise that the whole of this machine was the creation of the Socialist Party—

Mr. Swain

On a point of order, Sir Leslie. I appreciate that the hon. Lady the Member for Tynemouth (Dame Irene Ward) still thinks that she is a lady-in-waiting to Queen Anne, but is she in order in going as far as this from the Amendment, and wasting the Committee's time.

Mr. Loughlin

Further to that point of order, Sir Leslie. As the hon. Lady has already been allowed to refer to the machinery for the implementation of pensions, can I take it that hon. Members on this side of the Committee will be quite free to develop the same kind of case?

The Temporary Chairman

As long as hon. Members, in developing their case, keep within the rules of order. I think that the hon. Lady was getting rather near the line.

Dame Irene Ward

Thank you very much, Sir Leslie. I do not wish to embarrass the Chair.

If the proposals in the Bill are to be put into effect, including those altering the position of widows, does the right hon. Lady think that all this will happen without a machine? It is ridiculous if I cannot refer to the machine through which these proposals, to which she referred, are to be put into effect.

The right hon. Lady has made time and again as a reason for our Amendments not being included in the Bill the claim that she inherited a bad machine. I resent that statement, because the headquarters of the Ministry is in my part of the country and it has a first-class machine. I dislike and resent her criticism of the machine intensely. The whole basis of the system was created originally by the Labour Government in 1948. If she has inherited a bad machine, then I remind her that her own Government created it at a time when they had an overwhelming majority.

The Temporary Chairman

Order. The hon. Lady has now strayed from the rules of order. She is not entitled to make a Second Reading speech on the Amendment.

Dame Irene Ward

I leave that point, Sir Leslie. I have made it. But the right hon. Lady must not resent the fact that my party wants to make progress. [HON. MEMBERS: "Oh."] By our Amendment we want to make progress.

The Minister has referred to a review to be held. She has stated no time limit. Many widows will have been vitally affected by the present regulations if they continue for much longer. I want to know how long the review will take. Hundreds more anomalies will be created unless the Minister says when the review must be completed. There is no sense in the right hon. Lady saying that everyone must wait for a review. The party opposite never said that at the time of the election. The Minister must not complain if the Conservative Opposition challenges the promises made by the Socialist Party during the election.

Mr. A. E. Hunter

On a point of order, Sir Leslie. Surely the hon. Lady is out of order. We are discussing Amendments to the Bill, not the General Election.

Dame Irene Ward

I am discussing Amendments to the Bill.

The Temporary Chairman

Order. When I judge the hon. Lady to be out of order, I shall say so.

Dame Irene Ward

I am discussing the Amendments, which have been referred to by the right hon. Lady. Her only answer was that they would only create more anomalies. Yet when the present Government were in opposition they had plenty of opportunity to consider what they wanted to do. I have referred to the reduction of the age to 45 and to the increase for the 10s. widow which enables her to pay the stamp—and I am pleased about that. But the right hon. Lady has left many widows without consolation. I only ask her when we may expect her review to start, whether it is to be public and how long she thinks it will be before she accepts our proposals, about which she spoke sympathetically.

I am thoroughly disappointed that those who went to the country on the basis of proposals we now embody in these Amendments, and who promised the earth, are now unable to fulfil those promises because they cannot get the Treasury to agree to giving the necessary money.

Mrs. Lena Jeger (Holborn and St. Pancras, South)

It would be unseemly of me to make a personal speech. It is the last thing I want to do. But I must declare my interest. I must inform the Committee that, as a no-shilling widow for 11 years, I am amazed today by the hypocrisy of some speeches from hon. Members opposite and find them bitterly unacceptable.

In the 11 years that I have been alone I have not had one word from the Conservative Government either of hope or of encouragement towards the possibility of those widowed at the age of under 50 receiving any consideration from a Government who have been in power during a period of unparalleled affluence in the post-war history of the country. I observe that the hon. Member for Tyne-mouth (Dame Irene Ward) is laughing. I do not know why she should.

Dame Irene Ward

I just commented, "Really", because the hon. Lady said that we were affluent.

Mrs. Jeger

I am trying to deal very seriously with what to many women is a deeply serious matter. It is very difficult to deal with this question of the age of the widow in isolation from many other factors. The Amendment suggests that, in certain circumstances, the widow's age of benefit should be reduced from the age of 50 to the age of 45. I think that there are powerful reasons why this should be done. I know that my right hon. Friend will consider these reasons. But I must ask the Committee to take cognisance of the other factors.

At present, it is not so that a widow over 50 is entitled to benefit. I have a friend who, at the age of 55, had a very delightful Indian summer romance. We were very happy when she married a man of 60. They were immensely happy together until one terrible day when, on his way home from work, he was knocked down and killed by a drunken driver. That lady gets no pension at all. She is over 50.

Her husband's stamp record was immaculate, but they had not been married quite three years. So her age did not matter and the impeccability of his stamp record did not matter, either. She was told that she must go to the National Assistance Board if she could not earn enough to keep herself. But she said, quite rightly, "I could have gone there if my husband had never bought a stamp in his life".

I mention this case to show that if we try to isolate all these factors of widowhood it is impossible to get a fair and full' picture. I know another widow, also over 50, who is receiving a tiny fraction of the pension because she was married to a rather inadequate specimen of manhood—which does happen, often to some of the nicest and kindest of women. Although this lady was over 50 when her husband died, she was unable to get her full pension because there was something wrong with his stamp record.

The basic problem—and this is why I support my right hon. Friend in waiting for the complete review—is that we have not decided whether a widow's pension is hers as of right as an insurance benefit, linked to her husband's stamp record, or whether it is a biblical outpouring of charity. Until we get that basic decision straight, and until we consider it in the light of all sorts of sociological factors, such as the increasing need for women of all categories to continue work in the present position of our society, we shall not get the picture right.

Basically, the widow's problem is her own. She has to come to terms with her life on her own. But it is for the Government to look at all these factors which can make it possible for some kind of social justice to be done. I submit very sincerely that more attention should be paid to the connection not between the widow's age and the circumstances of her widowhood, but to her husband's contribution record.

One reason why many widows who receive no pension at all feel a sense of injustice is this. One type of widow is told, though her husband may have paid his insurance contributions for 20 years, "You are under 50. This is not an insurance benefit. It does not matter how much your husband paid in. You cannot get anything." Another type of widow who is over 50, but whose husband's stamp records are not complete is told, "You cannot have anything, though you are over 50, because there is something wrong with your husband's stamp record." This suggests that there is a dichotomy in the situation which, to be fair, has persisted through both Administrations.

This is a question which we must all try to solve. I have spoken only because I think, though I have a great deal of sympathy with the thoughts behind the Amendment, that it would not help those wham it is most essential to help to take the question of age in isolation. I am sure that I speak for many when I say that we must ask the Government for a comprehensive and fundamental review of this tangle of anomalies, injustices and muddles.

6.0 p.m.

Sir Keith Joseph (Leeds, North-East)

I support the request of my hon. Friend the Member for Tynemouth (Dame Irene Ward) to the right hon. Lady to tell us more, if she refers to the inquiry, about what sort of inquiry is intended. The speeches of my hon. Friend the Member for Somerset, North (Mr. Dean), the hon. Lady the Member for Holborn and St. Pancras, South (Mrs. Lena Jeger), and, indeed, of the right hon. Lady the Minister show that neither side of the Committee is satisfied with the varying provisions which are made or not made for widows. The only difference is that, whereas this side of the Committee, in its election manifesto, promised a comprehensive review of all social security provisions, with special mention of the varying provisions for widows, the Labour Party, during the election, made a number of detailed promises which it is not now fulfilling, but it has adopted our proposal for a review.

The right hon. Lady, well within her rights, spoke about the review. My hon. Friend the Member for Tynemouth reflected in her questions the point expressed by my hon. Friend the Member for Finchley (Mrs. Thatcher) the other day, that the country expects the inquiry to be of a public nature; that is, an inquiry conducted outside the Department. It is not that anybody distrusts the integrity of the Department. It is simply that when a Department has been concerned in such detail for so long with problems it is perhaps better that outside people, open to public evidence, the evidence and the report being published, should conduct the inquiry.

I am merely asking that the right hon. Lady should at least tell us when she and her right hon. Friends expect to make an announcement about the inquiry, even if she cannot make that announcement today. We hope that she and her right hon. Friends will note that we on this side of the Committee expect such an inquiry to be of the public character I have mentioned.

Mr. William Hamling (Woolwich, West)

I am not sure whether I would be in order if I followed the right hon. Member for Leeds, North-East (Sir K. Joseph) in speaking to these Amendments, because he did not speak to the Amendments. He followed the hon. Lady the Member for Tynemouth (Dame Irene Ward) in talking about a general review. Nevertheless, I will pursue one or two of the right hon. Gentleman's remarks. He came down to the fact that the Conservative Party favoured the appointment of a Royal Commission. [HON. MEMBERS: "No."] He stipulated an outside body with independent witnesses. What else would that be but a Royal Commission? How long would that have taken? Would it have taken another 13 years?

I remind the Committee that last January the House of Commons had an opportunity to do all the things covered by the Amendments. I will put myself in order by returning to the Amendments. Hon. Members opposite did none of those things. What we have witnessed this afternoon is a display of sanctimonious hypocrisy, with hon. Members opposite expressing concern for people whom they neglected for so long. When my right hon. Friend brings forward immediately after the election emergency legislation to deal with some of the immediate problems, the Conservatives have the impudence to make the sort of spurious speeches which have been made today.

Earlier this year the hon. Member for Finchley (Mrs. Thatcher) had the opportunity. In January there were Motions dealing with widows' benefits and with provisions for widows. The hon. Lady voted against them.

Mr. E. Fernyhough (Jarrow)

So did the hon. Lady the Member for Tyne-mouth (Dame Irene Ward).

Dame Irene Ward

No, I did not.

Mr. Hamling

The hon. Lady did. I will quote the exact debate, if the hon. Lady wishes. It was on 30th January, 1964. The hon. Lady the Member for Tynemouth voted against an Amendment designed to effect certain increases in widow's allowance, widowed mother's allowance and child's special allowance. So did the hon. Lady the Member for Finchley. So did the hon. Member for Uxbridge (Mr. Curran). So did the whole of the Conservative Party.

Mrs. Thatcher

If we divided on this Amendment, would the hon. Gentleman vote with us?

Mr. Hamling

The hon. Lady has not scored anything.

Hon. Members

Answer.

Mr. Hamling

I shall not vote with the hon. Lady, because the Amendment is not an honest one. If this had been honest, she could have done it in January.

The Temporary Chairman

Order. I do not think that the hon. Gentleman should say that of hon. Members who have put their names to an Amendment. To suggest that such an Amendment is not an honest one is contrary to our traditions.

Hon. Members

No.

Mr. Hamling

I withdraw the words "is not an honest one" in this connection. I remind the Committee that the hon. Lady's intervention was intended to convey to the Committee that I was being dishonest and insincere. There were opportunities during the last 13 years to carry out every one of these Amendments. The Conservative Party failed to do so.

Mr. Norman Cole (Bedfordshire, South)

I want to tell the hon. Member for Woolwich, West (Mr. Hamling), so that he can identify me, that my constituency is South Bedfordshire. If he cares to look up the record to which he has referred—I think that we are talking about the same occasion—he will find that I—whether it is a criticism or the opposite I am not prepared to say—do not fit personally into the category he has just mentioned.

I and at least one, if not two, of my hon. Friends tabled an Amendment of the kind we are now discussing to the then Government's Bill earlier this year. Our Amendment sought to reduce the qualifying age not to 45, but to 40. The hon. Gentleman will find, if he cares to consult the record, that I did not support the Government on that occasion in that matter. I am glad to be able to tell him that. I want to make it clear that I am not saying this by way of a personal explanation. I am pointing out that the hon. Gentleman should be very careful when he tries to analyse records.

If he consults the OFFICIAL REPORT he will also find that some of my hon. Friends and I were in favour of other measures being taken, some of which are being implemented in the Bill. I say this to show that at least I do not qualify for the accusation of hypocrisy as a result of anything I have done about the subject we are discussing. I have taken a quite unpolitical but personal and human view of the matter over the last 10 or 12 years. I shall continue to do so, irrespective of whether our party is in Government or Opposition.

I do not blame the Minister for saying that before she can take the matter further or accept Amendments of this sort she must await the outcome of the review. I support my hon. Friends in urging that the review should be as public as possible. Indeed, it might be in the interests of the Minister's party if it is public, so that not only widows but everyone else will see that the right hon. Lady intends justice to be done. I hope that the review will be as comprehensive, open and public as possible, with every possible piece of evidence being brought to light. I make that not as a political suggestion but as a reasonable and human one.

Mr. Stanley Orme (Salford, West)

Why is it so essential that this inquiry should be public in view of the wealth of information already in the hands of the social services? The Minister and her advisers already have access to this information, so I cannot understand why it should be held in public.

Mr. Cole

I hope that that comment does not reflect the views of the party opposite. The simple answer is that it should be held in public for the reason that many of the provisions in the 1946 Act are out of date. Information may be in the hands of the Ministry, but that does not necessarily mean that all of it is up to date. Only if the review is held in public, with all possible evidence brought into the open, will absolutely up-to-date information be available to the Minister. Parliament has a responsibility to the electorate and we should show that on a matter as important as this we are prepared to study everything in the open. Would that not add to the prestige of Parliament in the country?

There are two reasons why the review is vitally important. The first is that the Government are finding that being in Government is different from being in Opposition. We understand the Minister's difficulties, her having taken office only a few weeks ago. The second is that I suspect that, having seen the books, the right hon. Lady now realises even more than before—and I pay tribute to her knowledge of this subject—how complicated a matter it is.

The hon. Lady the Member for Holborn and St. Pancras, South (Mrs. Lena Jeger) gave two examples of how widows can suffer as a result of the complicated procedures over this matter. Many other examples could be given and although only a relatively small number of widows may be affected, their plight should be ventilated and brought into the open.

I have a personal view which might not be incompatible with the terms of reference of the inquiry. For some time I have been wondering whether we are approaching this whole subject in the right way. May we not be taking the line of least resistance? It is convenient to say that if a widow is under 50 she will not qualify, irrespective of her husband's stamp record, while if she is over 50 she will qualify. We are all aware of the thinking behind that; it is assumed that at 47 one can get a job, if one is lucky, while at 52 one cannot. The regulation is that there must be a borderline age somewhere.

6.15 p.m.

In the Amendment earlier this year about which I was speaking the suggested borderline age was 40. In this Amendment it is 45. No one can say which is the right age. That being so, should age be the dictum of decision? After all, with a business insurance policy or an insurance fund, age does not arise if one has paid one's premiums. In a pension scheme there is no question of how long one has been married.

Is there not a chance that, for the sake of convenience, we have in the past been adopting the wrong premise? I am not suggesting that I have the answer. In a heavily industrialised area like that represented by my hon. Friend the Member for Tynemouth (Dame Irene Ward) it might be better to consider this matter not in terms of age but in terms of a widow's capacity to get a job in the area. If I am told, "You cannot expect any committee to decide things like that" my answer is that we already have pensions tribunals, branches of the National Assistance Board and other organisations deciding very similar questions. I just want to be sure that we do not, for the sake of convenience, go on taking the line of least resistance.

I would like to give this matter a great deal of research. Widows should be treated in their own right as widows and, considering the wealth of the nation, there should be no delay in giving them financial sustenance. A woman gives up a lot when she marries. Often she severs her business connections and takes on a new kind of life. I do not care whether she is 33 or 53, if she suddenly meets widowhood and is completely financially unprepared, provision should be made for her, even if only on a temporary basis until she is able to rehabilitate herself.

These matters should be looked into by a tribunal. We should be certain that the age limit is as appropriate as it can be. The sooner we study these matters and get some results the sooner justice will be done. I support the Amendments because although they do not go as far as justice demands, they will be of great help. I regret that the Government, because of the review mentioned by the Minister, cannot accept them. The fact that there is a review is, I agree, a good reason why the Minister should say that the Amendments are not acceptable. She cannot be expected to anticipate the findings of the review.

I hope very much that the right hon. Lady will make her review as comprehensive and as public as possible. Its terms of reference should be as wide as can be devised. If she does that, I do hope that the results of the review will be analysed quickly and immediate action taken so that justice is done for all widows.

Mrs. Thatcher

Although we have had an interesting debate the situation is in some respects rather ironic. Were the Minister standing at this Box she would be congratulating my hon. Friend the Member for Somerset, North (Mr. Dean) on the excellence of his speech and the rightness of his cause and would be urging him to take the matter to a Division. If I were standing at the Dispatch Box opposite I would also probably be congratulating my hon. Friend on his excellent speech, pleading the defence of the review and urging the Committee not to divide. I know that the right hon. Lady would like to do this if she could. I believe that the ideas which have been ventilated today show that there are very many ways in which widows could be helped and that we are not agreed on exactly the right way to help them. Some people want widows' benefits to be put on an entirely different basis and some want a change of age.

I hope that we can move on to the next Amendment, which gives us the chance to debate similar subjects on an even wider rule. I recommend, if I may be so presumptuous, that we do not divide on this Amendment in view of the assurance given by the Minister that she will consider this matter in her review.

Mr. Hamling

The hon. Lady's party is in favour of a comprehensive review, It her mind is so set on all these Amendments, what possible things could this body about which she is talking review?

Mrs. Thatcher

It could review the basis of provision for widowhood and consider whether the present basis—the absence of earnings basis—is the right one, or whether widowhood itself should be the basis of widows' pensions. I shall have something to say about this matter on the next Amendment, which I believe will provide a more suitable opportunity for saying it.

Mr. Dean

I am disappointed with what the right hon. Lady the Minister has said. She accepts many of the points which have been put forward, but is not willing to concede the arguments which have adduced. However, I welcome her assurance that all widows' benefits, and particularly the various ages for the benefits, will have high priority in the review.

I wish to make one further comment. It is very unfortunate that every time hon. Members on this side propose further to improve National Assistance arrangements are accused of hypocrisy. Are we expected to abdicate our duty to try to go on improving the National Insurance Scheme as we have been doing over the last 13 years?

In view of what the Minister said, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mrs. Thatcher

I beg to move Amendment No. 4, in page 2, line 13, at the end to insert: (5) There shall be payable to a widow, who is aged thirty-two years or over, without prejudice to any benefit to which she may be entitled at any other age under this or any other enactment, a pension at the rate of thirty shillings a week.

The Temporary Chairman

It would be convenient if we also discussed new Clause No. 2 entitled "Four pounds a week for all widows":

1. (1) Notwithstanding any of the provisions of the National Insurance Acts 1946 to 1964, or the National Insurance (Industrial Injuries) Acts 1946 to 1964, or any other enactment relating to any other benefit to which widows may be entitled under the conditions therein specified for the time being and at the rates currently in force all widows (whether or not qualified under the provisions of all or any of those enactments) shall be entitled to a weekly pension of not less than four pounds.
2. (2) The provisions of this section shall have effect without prejudice to benefits already payable under any of these Acts. These benefits shall remain payable in the terms and at the rates therein specified.

Mrs. Thatcher

This is yet another Amendment concerning the anomalies relating to widows' benefits. There have always been anomalies and, as my hon. Friend the Member for Somerset, North (Mr. Dean) said, there have been progressive improvements in the provisions for widows ever since the National Insurance Scheme started. Indeed, on one occasion I read out from the Dispatch Box a list of improvements which we had made year by year. It was an extremely impressive list.

The Amendment, however, relates to a new system which has been created by the several provisions of the Bill and regulations which will be laid subsequent to its passing. These provisions have created a new, and, I think, a more pronounced, set of anomalies. May I illustrate this by a "before and after" situation.

Before the Bill, benefits under National Insurance were granted on the old Beveridge principle, namely, a widow was entitled to benefit if she could not be expected to support herself by her earnings. If she could be expected to support herself she did not receive any benefit, or, if she did support herself, her benefits were withdrawn. The whole basis of benefit under the National Insurance Scheme was that the widow could not be expected to support herself by her earnings.

There was one exception to that, namely, those who were married before 31st July, 1948, to men who were insured under the old scheme. They had a pension of 10s. a week—not very much, but no contributions have been paid since 1948 over and above the National Insurance contributions in respect of this old pension. In fact, the right to benefit has persisted all the time since 1948, although no special contributions over and above the National Insurance contributions have been paid since then. It has been an enormously long transitional provision the longest, I think, in history. Before that benefit was given in the absence of earnings with one small exception, namely, the 10s. widow.

Since the Bill, benefits cannot be said to be given on the ground of absence of earnings. Quite substantial benefits will be given under the regulations to be proposed regardless of whether there are earnings there or not. The former 10s. provision will be 30s., regardless of whether earnings are there or not. In addition, those who are over 50 when they are widowed or when they cease to have dependent children will get benefits, not in the absence of earnings but in addition to earnings, however great those earnings may be. Therefore, however difficult the dividing line was before, it is an even sharper and higher dividing line now.

Perhaps I can illustrate that with three examples. Take three ladies working next to one another on a factory bench. Suppose that one is over 50 and is earning, say, £8 a week. Because she is over 50 and because the earnings rule is being abolished under the Bill, she will get £8 a week plus £4 benefit and not have to pay a stamp. Suppose that next door to her there is a widow just under 50 who was married before 1948. She would get £8 a week plus 30s. benefit, and she would pay her stamp. Next door to her may be a third widow who is under 50, married after 1948, and who also earns £8 a week. She would get no benefit whatsoever and would pay a stamp. There could be a fourth widow who perhaps was not fit enough to work the whole time but was not sufficiently ill to get a doctor's certificate who would have precious little earnings but would get no benefit because she was expected to support herself by her earnings.

The justification for the Amendment is that a new set of anomalies has been created which increases the disparities by a considerable amount over those which existed before because there are much greater differences and the benefits can be paid in addition to substantial earnings. We could have a woman Member of Parliament—who, I understand, will get £3,250 if certain resolutions are passed—who, if she were widowed over the age of 50, would be entitled to draw her £4 widow's benefit, whereas the person just under 50, or whatever age we laid down, would not be entitled to draw benefit although her earnings were very slender.

Mrs. Jeger

Would the hon. Lady add to these contradictory situations the widow who has inherited a considerable estate, who is benefiting from a large unearned income and who is able to draw her pension with no deduction at all?

6.30 p.m.

Mrs. Thatcher

I entirely accept that. I am dealing with anomalies within the National Insurance Scheme, because under the scheme one gets certain benefits in return for certain contributions. I do not think anyone would say, in dealing with an insurance scheme which gives certain benefits in return for certain contributions—there could be no justification for saying—"You shall not get the benefits because you can afford to look after yourself." If one has a fire insurance and pays certain premiums and then one suffers a fire the insurance company does not turn round and say, "You are not going to get benefit because you can afford to do the repairs yourself." This is an insurance scheme, and I was dealing specifically with anomalies which arise between contributors to that scheme, and I believe that those anomalies have been considerably increased.

Miss Herbison

I think the point that my hon. Friend was making is one anomaly which obtains at present. The hon. Lady has been giving a list of the different kinds of widows, perhaps working next to one another, with one over 50, and earning with full pension and no contributions paid, while another who has a full pension at the present time has had no earnings rule applied to her, no matter how great the unearned income. I think that is the point my hon. Friend was making. This will make no difference. That has always obtained, and we did not hear anything about it from hon. Members opposite before.

Mrs. Thatcher

Yes, but the whole scheme is based on absence of earnings. One was insured against absence of earnings under the Beveridge system; not against absence of income, but against absence of earnings. This Bill is substantially increasing the anomalies as between contributors to the National Insurance Scheme—substantially increases the anomalies in the way I have indicated. If we look at the anomalies in the gross sense we find that the pre-1945 bride can, as I have already pointed out, I think three times, from this Box, draw some £1,800 more than the post-1945 bride for the same record of contributions. The anomaly there was to the extent of £1,200. Only a fool would say that the anomaly is not greater than a £600 anomaly. It is a £1,200 anomaly.

The case for this Amendment is really that it is a holding Amendment designed to reduce anomalies which have been created by this Bill, so that everyone over the age of 32, which is the youngest age at which we can get 10s., can get at least a basic pension of 30s., which would fit in with the right hon. Lady's conception of a sliding scale, and to some extent would soften the very harsh dividing line of 50 and over 50: the dividing line with, on one side, full earnings plus full pension, plus no stamp; on the other, few earnings, no pension and a stamp to pay.

We are also entitled to discuss the second new Clause, and, of course, undoubtedly the case for a review will come up again. I think that women members of this Committee probably have more intensive ideas about the help which can be given to widows. There are a number of different opinions held, I know, about how best to provide for widows. I think the right hon. Lady and I would both agree with her comment on 30th January last, that the Labour Party, and the Conservative Party, officially realise that, as she said, widowhood of itself should not give a right to pension".—[OFFICIAL REPORT, 30th January, 1964; Vol. 688, c. 620.] I agree that no party has yet officially adopted the thesis that widowhood of itself should give a right to pension.

I think that particularly some of the women Members may go further on this than some of the men Members. I always thought it very ironic that a wife should have a right to maintenance from her husband during his lifetime, that upon his death, and upon his leaving her nothing, and without a will, she has considerable rights to his intestate estate, that if he leaves a will but leaves his estate to someone else she can still probably get the will upset; that during his life she has a right to maintenance, that if he dies leaving her nothing the chances are she can get some of his estate, but she has no right whatsoever to compel her husband to make reasonable provision in the event of his death. I think, personally, that she should have that right under this Bill. I am speaking entirely personally from this Box, because I have not yet converted my party, any more than the right hon. Lady has converted hers, but I think that widowhood as such should be entitled to certain benefits. After all, under the old rules there were marriage settlements, there were wills which were automatically revoked by marriages, and all that was because with marriage there was a change of status and a change of commitment. I would put this view forcefully before a review body and put it publicly.

The Chancellor of the Duchy of Lancaster (Mr. Douglas Houghton)

Put it to me.

Mrs. Thatcher

The right hon. Gentleman is not much good. What I mean is that, I am sorry to say, I see not much point in talking to the right hon. Gentleman about it. However, I have spent some time on this only to show how inconsistent is our attitude, in that we insist on a wife's maintenance during her husband's lifetime, we provide for her maintenance after his death, but we still have to get over the problem of compelling husbands to make certain provisions for their widows in the event of their death.

Mr. Cole

I am most interested in what my hon. Friend is saying and she knows that I support her on this, as I have indicated previously, but would she say that the state of widowhood by itself should be a qualification?

Mrs. Thatcher

I think that, if one accepts that it would be right to compel husbands to make basic provision for their widows, then I think the next step would be that the State should insist that they make this basic provision, and that one could, therefore, make some provision under the system for the state of widowhood. I do not want to dwell on this because I am rather lonely on this side of the Committee in this matter, though a number of people would agree with me about it.

This point was brought rather forcefully to our attention when the new "Everybody's Guide to National Insurance" was published. We in this Committee are used to National Insurance jargon, which means one thing to us but something rather different to people who are not used to the jargon. That document said: The main National Insurance scheme pro-vides weekly flat rate cash benefits during sickness, unemployment, or widowhood, and on retirement. Naturally, people think from that that the state of widowhood does attract benefits.

I am very anxious that this should be dealt with by a review. It goes right to the root and the basic principle of National Insurance. I know there are difficulties. Perhaps a young girl of 19 who is widowed should not have the right to a pension for the rest of her life. On the other hand, perhaps she could receive some benefit; perhaps not very much. This is fundamental to a review, and I hope that it will be inquired into.

The reason for the Amendment which I am moving, rather than the one I have been discussing, it to reduce the anomalies till such time as a review body has reported.

Mr. Curran

I rise to support the Amendment moved by my hon. Friend the Member for Finchley (Mrs. Thatcher) and also to say something about the new Clause in my name and that of my hon. Friend the Member for Tyne-mouth (Dame Irene Ward). We are proposing this change in respect of the widow who is 32 or over because the Bill as it stands does intensify and multiply the anomalies in the treatment of widows. There is, of course, a wide range of anomalies.

Take the 10s. widow. Should she continue to get 10s. in spite of the change in the value of money? The answer is that she ought to get more. But we cannot look at her in vacuo. We have to recognise that, so far as the ordinary citizen is concerned—certainly so far as the ordinary woman is concerned—what we are doing for the 10s. widow intensifies the absurdity of the rules we make about widows.

We must make up our minds whether we are going to stick to the Beveridge assumptions or whether we are not. The Beveridge assumptions were that widowhood as such should create no claim to benefit and that all social benefits should be paid as a substitute for loss of earnings. If you could not earn because you were too old, or because you were sick, or because you were injured, or because nobody would employ you, then because you could not earn you had a right to benefit. But, said Beveridge, widowhood as such did not and should not confer a right to benefit.

This was not the view taken in this country before the war. The Act under which the 10s. widow benefited was an Act which said that widows in certain circumstances should get benefits because they were widows. Since then we have gone further. We have conferred on other classes of widows a right to get pensions, because they are widows. We have given a pension to the war widow and also to the widow whose husband is killed in an industrial accident. Consequently we now have four classes of widows in this country. There is class one, the 10s. widow now to become the 30s. widow, who gets a pension because she is a widow. Then there is class two, the war widow, who gets a pension because her husband has died in action. Then there is class three, the widow who gets a pension because her husband has died in an industrial accident. Then we get class four, the great mass of widows who do not come into those other classes and who are denied pensions. It is to this difference that I want to address myself.

I have been re-reading the Beveridge Report. It is very interesting now to look back on it and to find what Beveridge decided—that widowhood as such should not create a claim to benefit under the National Insurance Scheme. He said that after an extensive review of the arguments submitted to him. He did not come to this conclusion in a hurry. He filled several pages of his Report with an examination of the arguments for and against. In the index he printed a long list of witnesses who came before him to give evidence—including, I suppose, evidence in reply to the question, "What should be our attitude towards widows?"

It seems to me that the example of Beveridge is an example which the Government ought to follow in setting up their review. Beveridge did take evidence, he did have the matter thrashed out in front of him, and he did come to certain conclusions about what our first principles should be in the treatment of widows. There is nothing sacred about those first principles of his. Nothing at all. I do not see why the Government or any kind of departmental inquiry, or intramural inquiry, should decide what should be our basic principles about widows. This is a matter for national decision. It is a matter of far greater importance than Government. After all, the present Government will not be there for ever. Whatever decision is now taken about our treatment of widows it will govern us much longer than the present Government will govern us.

6.45 p.m.

I very much question the Beveridge assumption that widowhood should not break a claim to benefit, and I cannot help thinking that we should abandon it, and, finding anomalies, that we should abandon them. No matter how we try to work inside the Beveridge doctrine that we shall pay benefits only for loss of earnings and not for loss of a husband, we are bound to have anomalies as fast as we remove one anomaly, we create another. I believe that we must abandon the Beveridge doctrine. We must say, plainly and flatly, that widowhood as such does and should create a claim to benefit. In saying that, I believe that I say something with which the great mass of our people will agree. Certainly whenever I have expressed myself on this matter in public—and I have done so inside the House and outside it—I have found that ordinary women endorse this view.

Looking back, I find it difficult to understand why Beveridge did not adopt it As far as I can gather—this is not based directly on the Report but on the climate of opinion which accompanied the Report—it must have been a sop to the theory of sex equality: that as we do not pay pensions to widowers, we should not pay them to widows either. Now when a man loses his wife, he cannot come to the State and ask the State to support him because he has lost his wife. If he did that he would be told promptly and probably profanely to stop snivelling and do some work. Well, we put the married woman who loses her husband in very much the same position as the man who loses his wife. But this does not correspond to the realities of every-day life.

In spite of sex equality, it is idle to suppose that getting married is the same for a woman as it is for a man. In spite of sex equality, it is still true that for most women getting married is a career and that when a woman loses her husband she suffers an economic as well as an emotional disaster. It is an economic blow to her in rather the same way as losing his job is an economic blow to a man. I believe that we should recognise this fact here, just as I believe that it is recognised by ordinary men and women outside the House. At present we do not recognise it.

We must not permit ourselves to be spellbound by the doctrine of sex equality. There is a difference. It may be argued, and perhaps it may be plausible, in Hampstead, Chelsea or Bloomsbury, to say that the sexes are equal and that since we do not give pensions to widowers we should not give them to widows. But this makes no sense at all in Coronation Street, on the mass level. Coronation Street believes that when a woman gets married she enters into an economic as well as an emotional alliance and that she looks to the economic alliance for support When that support is withdrawn, she is entitled to compensation. The State should recognise the loss of a husband in exactly the same way as it recognises the loss of a job as creating a claim for benefit.

If we say this, I know that we shall face, not anomalies but certain consequences which may sound absurd. If we say that widowhood as such creates a claim for benefit, we shall be asked, "Do you propose to give pensions to teen-age widows for the rest of their days or as long as they remain widows?" We must accept that whatever we do will be open to criticism. We must make up our minds broadly what is our basic principle. We have already tried one basic principle and it has produced a crop of anomalies so large and so overwhelming that the great mass of the British people are sick of them. We must now turn to a different basis. We must accept it that when we do, then we shall create, I will not say anomalies but some seeming absurdities. We must put up with that.

Meanwhile, by giving 30s. a week to the 10s. widow the Bill intensifies an anomaly. I hope that the Government will recognise this and will also recognise that the no-shilling widow will feel all the more indignant when this change takes place. I urge the Government not to say to the no-shilling widow, "We admit that you are being very hard done by, but you must wait until there is a review." We are legislating now and making changes in the National Insurance Scheme, now I suggest that we ought now to make this further change.

Mrs. Lena Jeger

It is difficult to discuss this Amendment without getting into deep philosophical water. I appreciate the feeling expressed in the serious speeches made by the hon. Members for Finchley (Mrs. Thatcher) and Uxbridge (Mr. Curran). In my experience the majority of men in this country—and let us talk about the men for a moment—honestly feel that when they buy their National Insurance stamp, which will soon cost them more, they are insuring their wives against widowhood. They may be wrong, but the sense of shock and surprise which these women feel when, being widowed, they go to the Ministry of Pensions and find that they have not an automatic benefit is considerable.

I agree with very much that was said by the hon. Lady the Member for Finchley—that there should be some automatic insurance provision against the problems of widowhood. Most men think that they are making that provision already. Hundreds of thousands of working men cannot afford to pay any more than the price of the National Insurance stamp, with the increase in the contribution which is to be made. I should prefer to see a situation in which the widow was brought within the National Insurance provisions on similar lines to those by which a widow gets benefit from an insurance policy which her husband took out commercially. Another anomaly which we are creating is that a woman whose husband during his lifetime was able, in addition to the National Insurance contribution, to pay for a commercial insurance policy for her, finds herself in an infinitely better position than does a widow whose husband was able to afford only the National Insurance contribution.

The review body will do very well to look at the question of relating benefits not to loss of earnings but to contributions in the same way as has become traditional and acceptable in normal insurance practice. The result would be that a young widow under 32, the age in the Amendment, who had not been married very long and whose husband had a very short insurance contribution record, would get some benefit but not as much as that laid down generally. It would be a sum related to the number of payments which he had made. That is the only way which seems to me to be fair over the wide range of circumstances with which we have to deal.

I am conscious that in trying to make some improvements for widows, no matter what their age, we are forgetting the circumstances in which many women find themselves who have not even had a few years of married happiness and who may be trying to bring up children on their own because their husbands have left them. There is the problem of deserted wives left with children and of the common law wife who does not always find it easy to collect the benefit after the death of the man with whom she has been living for many years. That is why I feel that, accepting much of the spirit of the Amendment, we shall do much better not to make a decision today but to relate these matters to the wider issue of the National Insurance benefits in respect of widowhood.

Mr. Cole

The Amendment is needed to fill a gap which, with the best will in the world, has been created by the Act. The review will have to decide whether we still adhere to the principle laid down by the Beveridge Committee on the subject of qualification for benefit by widowhood per se without there being any insurance background. My hon. Friend the Member for Uxbridge (Mr. Curran) gave the views on sex equality as a possible reason for the decision taken by Beveridge. With great respect, I differ from him. I doubt whether that was very much in the minds of the Committee at the end of the war. I think that we are still working towards an up-to-date philosophy.

May I remind my hon. Friend the Member for Finchley (Mrs. Thatcher) that it is less than 30 years ago that the law decided that a man, on his death, had to leave a certain minimum sum—which has since been increased—to his wife. From memory, I think it is £5,000.

Mrs. Thatcher

If a man dies intestate his widow is entitled to the first £5,000 if there are surviving issue or to the first £20,000 if there are no surviving issue.

Mr. Cole

A man cannot leave the whole of his estate away from his wife. He must leave a minimum sum to her. This follows a case in which a widow was left nearly destitute. The paramount view before the war and during the war, and one can only guess that the Beveridge Committee had the same kind of idea, was that a woman should have a right, once she became a widow, to some kind of emolument from the State only if there was a proper insurance background. All these years afterwards—18 years afterwards—we are still working towards the objective which I am sure one day we shall reach, of a widow qualifying in her own right as a widow, an objective which is hinted at, in the new Clause, whereby a widow would receive £4 a week, or, as in the Amendment, provided that she was over 32 years of age she would get 30s. a week.

I probably go as far as. if not further than, any other hon. Member in the Committee when I say that there should be no kind of qualification to benefit in these cases than the fact of being properly married and then being widowed. I am not a bit worried about the problem of young widows. Very young widows already qualify for compensation in some fields and the State manages to deal with that problem. We could look again at the position which would arise if they married again. But we do not want to rule out the possibility of a law which could help so many widows merely because in a few cases it might work out in a rather unusual way. That would not be a good policy.

7.0 p.m.

I welcome the Amendment and the new Clause which seek to provide a pension for widowhood. I think that we are only touching at a principle. I hope that before the Committee is very many years older we shall be able to reverse the Beveridge enunciation about widowhood. I think that we are pushing at an open door. After all, there is not one married woman in this country who might not next week find herself, if she were widowed, in quite a different situation, if such a law existed. I think that this is little enough for us to do for widows.

There are all sorts of special State provisions for emergencies occurring to various people, but here we seem to have come into a blank. I think that it probably stems from those immediate post-war decisions on which a lot of our Welfare State is based. The time has come to break them up, and to think about them all again.

A married woman is still not regarded as the breadwinner. She may be one of the two, but more often than not she is not so regarded, especially when she has to bring up the family. When she marries, she severs herself from the business world. She takes on a new and very proper kind of life which is different from that of the business world. Suddenly, on widowhood, she is transferred back into it, with the need to earn money, unless she qualifies under the present limited insurance arrangements. This is wrong. This is nothing to be proud of.

I hope that this review—and I am sure that it will if it takes note of the representations made to it—will reverse the Beveridge Committee's doctrine which I believe has coloured all our thinking ever since. I hope that the review will strike a new blow at these anomalies. These anomalies have existed for the last 18 years because we have not accepted the new principle. I welcome the Amendment and the new Clause. They show the way the straws are blowing, and I hope that we shall get a good wind of change about this.

Mrs. Freda Corbet (Peckham)

I intervene to stress the complexities of this problem. We all listened with great interest to the logical exposition of the hon. Lady the Member for Finchley (Mrs. Thatcher). This is the first time that I have heard this case argued, and it takes my mind back to many years ago when I heard the opposite one argued.

The hon. Member for Uxbridge (Mr. Curran) surmised that it was a theory of sex equality which weighed in the consideration of the Beveridge Report and its adoption. That was my impression of those days. There was the new woman. She was very proud, and she did not want to be supported, at least in intellectual circles. It has been my experience all through that the new woman is not exceedingly numerous, and that the average woman wants to be supported. She feels that, having embarked on this great enterprise and career of marriage, having interrupted any other possible career that she might have made for herself—and goodness knows there is enough intelligence and ability amongst members of my sex to make great careers for themselves—she is entitled to some provision in respect of widowhood.

I am interested, too, in another type of person who is a widow, but who in law is not. The hon. Member for Bedfordshire, South (Mr. Cole) talked about people who were properly married. I have had a sad case brought to my notice. I do not think that the Minister can do anything about it, because the law will not allow her to do so. This woman had been married, as she supposed, for more than 40 years, and had a family. She drew a pension for 12 years after her husband died. Suddenly it was discovered that her husband had been married before, that he had lived with his wife for eight months, and had a child by her. The result was that this woman's pension was stopped. This is the kind of thing which any review must take into account.

My hon. Friend the Member for Holborn and St. Pancras, South (Mrs. Lena Jeger) talked about deserted women. Is not desertion by a husband parallel to widowhood? These things, too, have to be considered.

There is a consolation for those who think that the cost of this help may be something which we cannot manage, that the good we do will not be commensurate with the burden. I think that the number of young women is decreasing, while the number of men is increasing, with the result that there is a better prospect of these young widows remarrying. Thus, actuarially, it may be possible to compute that an undertaking of this kind will not be as expensive as is now thought.

The extraordinary thing about the Beveridge situation was that everybody talked about getting older people off the market by encouraging them to retire at an earlier age—as the Committee knows we are making provision for people who postpone their retirement a little—whereas widows were practically forced to go on to the market. The curious situation today is that we want everybody on the market.

In the light of these facts, and modern developments, a review is long overdue. I think that when the Minister makes her review she will be grateful for the frankness of opinion which has been expressed by both sides of the Committee. We may not be able to hope for everything that we would like, but I am sure that great regard will be paid to the views which have been expressed.

Dame Irene Ward

We have had a most interesting discussion, and so many points of view have been put forward that I hope we have convinced the right hon. Lady that it should be a comprehensive and public review.

I support both the Amendment and the new Clause. I want to make one additional contribution which I think will add to the general picture. I support my hon. Friend the Member for Uxbridge (Mr. Curran) in what he said about the new Clause, but I disagree with him, if I may put it that way, over his assessment of the reason for the Beveridge decision on widowhood.

My mind runs back to just before the outbreak of the Second World War when there was tremendous feeling among the working spinsters of the country that there were too many very young widows drawing pensions for the rest of their lives, or until they remarried.

I remember that at the time there was a society which was formed in Bradford. It was run by a very active woman called Miss Florence White. I can see the Central Lobby filled with working spinsters. Miss White was campaigning for spinsters' pensions at 60, which was achieved in the end, and then she campaigned for spinsters' pensions at 55. There is no doubt that the fact that there were very young widows receiving pensions, while many hardworking spinsters, a number of whom were supporting aged parents, did not receive pensions, caused a good deal of controversy between the married and the unmarried sections of the community.

At that time also we had that vivid House of Commons personality, Miss Eleanor Rathbone, whom we all remember with great affection for her ability and courage. She was campaigning—and she was successful in the end—for family allowances. That in a way rather exacerbated the division betwen the married women or the widows and the spinsters.

I am sure that the right hon. Lady will agree with me that very often in discussing all these matters, we find that the older people disapprove of the family allowances, which they think should go to help the retired pensioners, and the younger section of the community who are bringing up families feel that it is tremendously beneficial to them to have the family allowance.

The Deputy-Chairman (Sir Samuel Storey)

We cannot discuss family allowances on this Amendment.

Dame Irene Ward

I shall not discuss family allowances on this Amendment, but I am pointing out that in relation to widowhood, and the elderly widow and the young widow, which is very much a part of the Amendment and the new Clause, the whole situation was exacerbated by these outside developments which were a feature of the 1930s up to the beginning of the war, and which, I think, played their part in forming Lord Beveridge's opinion on widowhood, which he embodied in the Beveridge Report.

When I hear the various assessment of the thoughts of Lord Beveridge in producing his Report I feel that the picture would not be complete if I did not add—as I knew Lord Beveridge quite well—that I have a suspicion that when he was considering his Report his mind was to some extent conditioned to the feeling that existed between the spinsters working and looking after aged parents and the young widows, now called the teen-age widows, who draw that very small pension of 10s. for the rest of their lives.

I think that the picture would not be complete unless I put that aspect of it into the contributions that have been made by so many hon. Members on both sides of the Committee. I thought that Lord Beveridge, in producing his Report, took this new approach to widowhood, which has given us a variety of anomalies.

Mr. Curran

I am grateful to my hon. Friend, because she can give a contemporary testimony of what Lord Beveridge believed. I would draw her attention to two sentences—there is an interval between them—from the Beveridge Report, and they are the key to his attitude on this matter. Lord Beveridge wrote: There is no reason why a childless widow should get a pension for life; if she is able to work, she should work. A little later, he said: Permanent provision for widowhood as such, irrespective of the care of children and of need, is a matter for voluntary insurance by the husband". I think that gives his point of view pretty finally.

Dame Irene Ward

I am very grateful to my hon. Friend, but the first sentence that he read out, that a young widow without children should not be entitled to a pension, derived from the fact that there was this controversy with the spinsters, who felt that they were in the same position as the young widows.

I always find myself trying to support any section of the community where I think an injustice or an anomaly occurs irrespective of whether they are widows, married women or spinsters. It is well to remember that even today, whatever we try to do for widows, it is very difficult to get comprehensive treatment for all the injustices, even with all the efforts made both by the Conservative Government and by the Socialist Government when they were in power before their defeat in 1951.

I think that this adds to our request that there should be a public, comprehensive review because so many people over a very wide field have experience of these matters, including those referred to by the hon. Lady the Member for Peckham (Mrs. Corbet)—the deserted wives. There is so much experience that it would be a great pity if a review, however honestly and sincerely undertaken, was purely Departmental and the country could not have the benefit of the evidence and the experience that would be put in if a comprehensive review were undertaken.

7.15 p.m.

I regret the anomalies. I think that the 10s. widow will feel very much happier as a result of the Government's action, and I am always pleased when people are made happy. It is very important in life. But there are a great many people who will be both aggrieved and frustrated. Therefore, it would help every one on both sides of the Committee if the right hon. Lady would tell us when she expects to be able to anounce to the House the review and the type of review. I hope that she will bear in mind that we emphasise these anomalies for the purpose of getting action, and that we shall have a comprehensive statement from the right hon. Lady before we part with this Amendment and the new Clause and, indeed, the whole of the Bill.

Miss Herbison

This has perhaps been the best debate we have had in Committee on the Bill. It has certainly been very wide ranging. The hon. Member for Finchley (Mrs. Thatcher) made it range widely in the points that she made. It is important that on this question of provision for widows generally we should hear the points of view of as many people as possible. Perhaps it is a good thing that these Amendments have given an opportunity to so many hon. Members on both sides of the Committee to put their points of view.

I come back to the Amendment and to the new Clause. I shall first let the Committee know what we feel about the Amendment. It is defective in drafting in several respects, but I make no fuss about that. Nor do I stress it. Because not so very many weeks ago I was on the benches opposite, trying to draft Amendments myself without expert help and I resented it when a Minister made great play with the fact that Amendments I had put down were not in the proper language.

The hon. Lady in making her case seemed to stress to the Committee that by raising the 10s. pension to 30s. we were making a fundamental change in the whole provision for widows' pensions. But that is not the case.

Mrs. Thatcher

That, coupled with the abolition of the earnings rule, means that we are giving widows' pensions on two separate bases, one for widowhood and one for the absence of earnings.

Miss Herbison

I will deal first, with the earnings rule. We have decided to abolish it for widows. There is no fundamental change in that direction, and I will tell the hon. Lady why. When my hon. Friend the Member for Holborn and St. Pancras, South (Mrs. Lena Jeger) intervened, she raised the case of the widow in respect of whom no earnings rule was applied because she had a sufficiently large unearned income, possibly, to live in comfort. The hon. Member for Finchley, in dealing with that point, said that insurance applied to earnings and not to income from some other source.

Mrs. Thatcher

Or the absence of earnings.

Miss Herbison

Exactly—or the absence of earnings.

I now come to the case of widows to whom, before we made this suggestion, no earnings rule was applied. The war widow receives a full pension. She can earn as much as she likes without having the rule applied. The industrial injuries widow is in the same position. She receives a pension as of right, and no earnings rule is applied. It is clear that the case put forward by the hon. Lady cannot stand. There is no fundamental change in doing away with the earnings rule and in raising the 10s. pension to 30s.

Mr. Curran

Surely something fundamental is involved here. The basic principle of the National Insurance Act is that benefits are paid instead of earnings. That is one reason for the earnings rule. People have no right to receive benefits and also earnings. We penalise them if they do. That is not my reasoning; it is Beveridge reasoning. If they draw the benefit and go on earning, in one sense they are breaking the rule. Is not that one reason for the rule?

Miss Herbison

The hon. Member has not listened to my explanation of the present situation. What I have tried to prove is that the Bill merely extends certain existing provisions, but makes no fundamental change.

The increase from 10s. to 30s. makes no change at all in the condition of the payment of widows' benefits under the National Insurance Acts. All those who qualify now for the 10s. pension—which is to be raised to 30s.—at one time had an expectation of receiving an unconditional pension under the old contributory pension legislation. The "no-shilling" widows—which are the ones covered by the Amendment—at no time had that expectation, either because their husbands were not insured under those Acts or because marriage took place after those Acts were superseded. Their position is, therefore, quite different.

There is no logic in the argument that if there is an improvement in a benefit paid to a person who enjoys a reserved right—and that is what the 10s. pension is—there must be a corresponding improvement for those who have no such reserved right. Let me take the hon. Lady's memory back to 1957, because this is important from the point of view of the case she made. The Government then raised the age in respect of the transition from widowed mothers' allowance to widows' pension from 40 to 50. But they retained the 40 years age limit in respect of widows who were widowed before 1957. The limit was raised to 50 years in respect of future cases.

What happened to those who had this right before 1957? In 1956, the benefit was 40s. It has been raised on three occasions since, and is now 67s. 6d. But no change has been made in the position of those widows who did not qualify for this concession—and 10,000 of them have been created since 1957. If the hon. Lady had been using the same logic, these 10,000 widows would have had the benefit of the improvement from 40s. to 67s. 6d. It seems to me that the two cases are similar.

I now turn to the new Clause in the name of the hon. Member for Uxbridge (Mr. Curran). This would give a pension of £4 a week to all widows, irrespective of age. No conditions are attached about contributions, age, duration of marriage, or even residence in this country. It is clear that at this stage it would be impossible for the Government to accept this proposal.

I have given what I consider to be the logical reason for the rejection of the Amendment. That does not mean that we are not concerned about any widow who is in financial difficulties. It was impossible for us to do everything in the Bill. The hon. Member for Tynemouth (Dame Irene Ward) said that all our idealism had flown out of the window and that this was a complete reversal of our policy. Later, we may be able to go over all that we have achieved in the Bill—we have not yet done everything, but we have made great steps forward in many directions.

The right hon. Member for Leeds, North—East (Sir K. Joseph) said that we had not fulfilled the detailed promises we had made in the documents we published beforehand. Election day was seven weeks ago today, and I would remind the whole Committee of the many promises that we are carrying out in the Bill.

I come back to one reason why I am going to ask the hon. Lady to withdraw her Amendment and the hon. Member for Uxbridge not to move his new Clause. This is not the time to make either this change, which would be applicable to all widows of 32 years and over, or the wide and sweeping change proposed in the new Clause. Speeches from hon. Members on both sides of the Committee in respect of this and the previous Amendment show that these are very complicated matters, involving problems to which there may be various solutions, which require very careful examination. Since that is the case, it would be much better for this to be left, as I asked the last ones to be left, until this review.

There has been insistence from the other side that we reveal the nature of this review and that we give the date when an announcement will be made. I cannot give the Committee the exact date. What I can tell the Committee is that we regard not only these questions of the provision for widows, but the whole of our social security structure, as of such importance that there will be real urgency in this review.

7.30 p.m.

Mr. James Allason (Hemel Hempstead)

Could the Minister tell us the number of widows who would be involved under this new Clause? It is of great interest to those who want to study this matter further.

Miss Herbison

It is impossible for me to give the numbers.

Is this £4 to go to the 10s. widow? Is the 10s. pension to be raised to £4? What of those who are getting nothing? Are they to have the £4? I could not give the full number, but it would be very large indeed. I ask that the Amendment and the new Clause be withdrawn so that these things can be examined, as I am sure the whole Committee wants them to be examined, and solutions that will be acceptable found to the problems.

Mrs. Thatcher

The Minister knows from what I have said that I am very anxious that the no-shilling widows should get something; and the sooner the day the better. I have no hesitation in putting the increased cost directly on contributions. I recognise, however, the force of what she said, and I will make just one point before asking leave to withdraw the Amendment. A big review of the structure of all the social security services must be complicated and of a kind which will take several years. [HON. MEMBERS: "It will not."] People are always very optimistic, when they have not been in the Department, about how long it takes to implement the changes recommended by a big structural review.

The review for widows could be a very much shorter matter, and would take in industrial injuries widows and war widows, whom I specifically did not refer to in my speech, which was confined to National Insurance widows. I ask that the widows' review should come quite separately and rather quickly and should report in advance of the major review on the structure of the social security services.

Having received the right hon. Lady's assurance, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Dean

I beg to move Amendment No. 5, in page 2, line 26, at the end to insert: (6) In section 4(2) of the Family Allowances and National Insurance Act 1964 (which relaxes the earnings rule in respect of retirement pensions) for the words "one hundred shillings" there shall be substituted the words" one hundred and twenty shillings" and for the words" one hundred and twenty shillings" there shall be substituted the words "one hundred and forty shillings".

The Deputy-Chairman (Sir Samuel Storey)

With this Amendment can also be considered Amendment No. 21, in page 2, line 26, at end insert: (6) For the words "one hundred shillings" in section 4(2) of the Family Allowances and National Insurance Act 1964, there shall be substituted the words "one hundred and forty shillings" and for the words "one hundred and twenty shillings" in the said subsection, there shall be substituted the words "one hundred and eighty shillings".

Mr. Dean

I will only detain the Committee for a short time in moving this Amendment, the object of which is to increase the amount which the retirement pensioners can earn, without deduction of earnings, from the present limit of £5 to £6. I have great sympathy with the Amendment which my hon. Friend the Member for Uxbridge (Mr. Curran) has down which would, in effect, take the bite out of the earnings rule altogether. We all recognise that the earnings rule is widely misunderstood and resented.

I hope that in this review the earnings rule and the problems which it creates will be some of the things which will be considered. I hope that in the interests of a scheme which people feel is fair, and also in the interests of gradual retirement, which I am sure we all want to encourage, it will be possible, in the review, to find a way out of the difficulties which, I admit, exist at the moment for the abolition—the cost and other things.

In the meantime, there is one imperative need for this proposal which we are putting forward and which is very moderate from the point of view of costs. Surely, if we are to abolish the earnings rule for the widow—I am not for one second complaining about it—the resentment felt by the retirement pensioner against this rule will be equally as great as is the resentment felt by the widow. If we are to abolish the one, surely it is only reasonable and right that we should relax the rule for the others.

This is my main reason for proposing this Amendment. I understand, from the answer to a question which I asked the right hon. Lady the other day, that this Clause would involve a comparatively modest charge for the sum we are dealing with of about £400,000 a year. There are many other arguments which I could put, but I do not want to detain the Committee any more than to say that this reason, above all others, is an exceedingly imperative one. I am encouraged, because the right hon. Lady said that she would be prepared to consider what the right level should be at any one time for the earnings rule for the retirement pensioner. I hope it will be possible for this at least not to have to wait for the review, but for this modest and reasonable Amendment to be accepted.

Mr. Roderic Bowen (Cardigan)

I interpret this Amendment, and certainly the Amendment which stands in my name and the names of my colleagues, as an attempt to go one step further towards the abolition of the earnings rule in its entirety, so far as it relates to retirement pensioners. It is on that basis and with that in mind that the Amendment in my name and those of my colleagues was put down and it is on that basis that I support the Amendment which has just been moved. We have in this Bill the provisions for the abolition of the earnings rule for persons who are in receipt of widowed mothers' allowance and persons who are in receipt of widows' pensions, but it leaves quite untouched the position of the person in receipt of a retirement pension.

It is, of course, right to say that from 1946 onwards this earnings rule has, in one form or another, been eroded, not only in relation to widows but also in relation to the retirement pensioner. For example, if I remember rightly, what is now the 100s. ceiling was in the 1964 Act originally 50s. I think I am right in saying that 50s. was the initial figure, but I am subject to correction on this matter. Whether it was 50s. or 40s., certainly there has been a change, which is an eroding of the earnings rule, at least to some degree. I would not be entitled to develop this, but in my view the only really valid argument against the complete abolition of the earnings rule at present is the cost involved. That is to say, the money which would be required, well over £100 million, could be better employed in helping other aspects of our National Insurance Scheme.

I wish to stress that we are dealing with a group of people whose number will increase. The people at present on retirement pension number approximately 6 million. By the end of the century that figure will be 8¼ million. The figures are even more remarkable in the case of men retirement pensioners, of whom today there are approximately 2 million. Within 25 years there will be over 3 million. The numbers will increase substantially up to 1980 and very substantially throughout the period to the end of the century.

I was intrigued by the arguments advanced during the Committee stage discussions on the 1964 legislation relating to an Amendment designed to abolish the earnings rule for widows. This Amendment was resisted by the then Government in January of this year. The argument advanced by the then Minister was—he was dealing with anomalies which would arise if the earnings rule for widows was abolished and comparing their position with that of spinsters— I believe that the only way out of this dilemma is to abolish the earnings rule for retirement pensioners as well. The Minister went on to say: Nevertheless, for reasons which I have tried to give today, I believe that it would be hopeless to try to maintain an earnings rule for retirement pensioners if the earnings rule for widows' benefits were abolished."—[OFFICIAL REPORT, 30th January, 1964; Vol. 688, c. 593.] The Minister came down against the abolition of the earnings rule in relation to widows, but he was saying in substance that if we are to abolish the earnings rule for widows, it would be unthinkable not to proceed further and abolish it for persons in receipt of retirement pensions.

So far as I know, the Opposition will not oppose that part of this Bill which relates to the abolition of the earnings rule—[HON. MEMBERS: "Why?"] I shall be surprised if they do, but it is remarkable what a change in location can do in a period from January to December.

Mr. Sydney Silverman (Nelson and Colne)

Would the hon. and learned Gentleman care to tell the Committee which position surprises him most, the position which the Opposition is going to adopt, as he says, today, or the decision which it took on the comparative question when hon. Members opposite formed the Government? Which does the hon. and learned Gentleman think the more surprising of the two?

7.45 p.m.

Mr. Bowen

I live in a world of surprises and I am not going to be drawn into trying to determine the varying degrees of surprises. It is clear that there has been some repentance in this regard, which I welcome, and I would like it to be carried to its logical conclusion, at least according to the views of the then Minister of Pensions and National Insurance.

The earnings rule was introduced by the Labour Party, mainly, I believe, because it was feared that retired pensioners would otherwise provide a source of cheap labour, that is to say—

Mr. Sydney Silverman

No.

Mr. Bowen

Certainly that was one of the reasons. If a person who had retired and was drawing a full pension was available for employment, it was feared that employers would take advantage of that situation and pay the kind of wages which they would not have paid were the recipients not drawing a pension.

Mr. Sydney Silverman

Does not the hon. and learned Member think that the main reason was that in the days when that legislation was introduced we were all under the incessant memory of long periods of mass unemployment, and it was considered that it ought to be made strictly a retirement pension in order that a contribution should be made towards relieving the still present fear of mass unemployment? Fortunately, this has diminished or disappeared since, but I think the reason why the pension was made a retirement pension in the first place was as a form of contribution towards the task of abolishing mass unemployment.

Mr. Bowen

I do not in any way dispute what the hon. Gentleman has said; that was certainly a factor. I reiterate that I believe a relevant factor was the fear of retirement pensioners being used as a source of cheap labour. No doubt both factors played a part.

In my view, the situation has changed substantially both in relation to unemployment and the danger of victimisation. I do not believe that the same force should be given today to those factors as was given, when the earnings rule was introduced. A continued erosion of this earnings rule would be bringing in line the position of the retirement pensioner with that of the war pensioner and those in receipt of industrial injury benefit. It would do away with the substantial anomaly, that in assessing the entitlement to a retirement pension, independent income is ignored. A person who is dependent on an additional income is placed in an adverse position in relation to a person who has an earned income.

I believe, as was mentioned in the intervention of the hon. Member for Nelson and Colne (Mr. Sydney Silverman), that what gave rise to the earnings rule was the idea that a pension should not be given unless a person was retired. I think it high time that we approached the matter from the point of view that a person who, by reason of years of productive work for society, and after satisfying the statutory provisions in relation to contribution, is entitled to receive a retirement pension. He should be put into the same position as he reaches when he is aged 70. If he has qualified by long service and contribution, it is the view of my party that he should be entitled to draw his pension irrespective of his earnings. It is because this Amendment is a step in that direction that I support it, and that is why there appears also on the Notice Paper the Amendment in my name.

We have heard a great deal about the comprehensive review that is to take place. We have here a matter that clearly ought to be taken into account in that review, but I ask the Government not to wait for that, but to take this further step to do away with what I now regard as a pernicious rule in relation to retirement pensioners.

Mr. Curran

I am not a late convert to the view that the earnings rule should be scrapped. The reasons for it that have been given in the past did not sound to me any more plausible then than those that we shall probably hear presently from the Government Front Bench. The earnings rule was invented by the Labour Party, which took it over from Beveridge—[Interruption.] I have the Beveridge Report here and if anyone is rash enough to dispute what I say, I shall quote from it—

Mr. Michael Foot

The hon. Gentleman says that he is not a late convert to the principle he now enunciates, but will he say why, on 30th January last, he voted in favour of maintaining the earnings rule both for old-age pensioners and for widows?

Mr. Curran

That exercise on that occasion was one that I did not consider to be honest—[HON. MEMBERS: "Oh."] Just a moment. Let me go on—

Mr. Hamling

On a point of order, Sir Samuel. I was pulled up about an hour ago for implying dishonesty in an opponent.

The Deputy-Chairman

It is not out of order to make such a charge generally. It is the individual charge that is out of order.

Mr. Curran

Thank you, Sir Samuel.

I was saying that that advocacy by the Labour Party of the abolition of the earnings rule was not honest. That was my opinion then, and it still is my opinion.

What we have to consider now is this. The earnings rule that was built into the Welfare State at the beginning has now been abolished in respect of one class of victim. I now ask whether it makes sense to abolish the rule in respect of one class and to leave it in force in respect of another. If we do that we create yet another anomaly and, goodness knows, the Welfare State is crowded with anomalies. Once we do what the Bill proposes, a widow will get her pension, when she is over 60, free from the earnings rule, but her spinster sister, also over 60, will draw her retirement pension subject to the earnings rule.

What are the arguments in favour of this rule? Why did Beveridge invent the retirement principle? I think that the hon. Member for Nelson and Colne (Mr. Sydney Silverman) was right. One of the considerations in Beveridge's mind—and, I suppose, one of the considerations in the mind of the post-war Labour Government—was that we might have a recurrence of mass employment, and it was thought desirable that people should be encouraged to retire from work, and so create vacancies.

But Beveridge went rather further than that. He used three arguments for making the pension conditional upon retirement from work. The first was that making retirement from work a condition of the pension was the logical consequence of giving adequate pensions. The second was that giving to each individual an incentive to continue at work so long as possible in place of retiring was a necessary attempt to lighten the burden that would otherwise fall on the British community, through the large and growing proportion of people at the higher ages.

The third was that the age to which men could go on working with satisfaction to themselves and advantage to the community varied with every individual and from one occupation to another.

Beveridge argued that we were giving a retirement pension that was adequate for the pensioner to live on and that it was therefore right to attach an earnings rule to it. Secondly, he suggested that when we were fixing the age of retirement it should be made flexible. In fact, neither condition has been fulfilled. The retirement pension is not, and never has been a subsistence pension. It was not adequate even at the beginning. It has never kept pace with inflation. Even with the provisions of this Bill it still will not be adequate. A pensioner cannot possibly live on £4 a week. If he has no other means, he will still have to seek a supplementation from the National Assistance Board.

The implied theory on which Beveridge rested—that the pension would be adequate for people to live on and that it was therefore right to attach to it the retirement condition—has not been fulfilled. It never has been fulfilled, and is not being fulfilled now. I suggest that the argument on which the earnings rule was based at the beginning is one that has completely disappeared. Even if it was plausible to use the argument in 1946, it is completely implausible to use it in 1964.

The stock defence for the earnings rule is one that I have had from my own Front Bench when we were the Government, and I daresay that we shall hear it once again from the Minister tonight. It is that we cannot afford to scrap the rule because to do so would cost £120 million a year. That figure was quoted by the right hon. Lady in last week's debate. That sum has increased from the £100 million, at which it has stood for many years, to £120 million because of the increased benefits. I have never understood the basis for that calculation, nor have I been able to understand why it is accepted as easily as it seems to be.

It rests on the assumption that all those women of 60 who now work until they are 65, and all those men of 65 who now work until they are 70, in order to get larger pensions after a further five years at work will, if the rule is abolished, immediately give up regular work and retire to collect the pension. There are 400,000 such people, and the argument is that they will all act in that way. I do not believe it.

We now see around us a great increase in job pensions. Many men now look forward to such pensions. A man of 65 in a job pension scheme may in two or three years' time collect substantial payments. Are we expected to believe that he will abandon his job at 65 and surrender his prospective rights merely to draw £4 a week from the State scheme?

I think it highly improbable that the Ministry is accurate in assuming that all the 400,000 men and women who could retire in the circumstances I have outlined will do so. But, unless we accept that assumption, the £120 million story disappears. I expect that tonight we will get the same sort of reply that we have heard many times before, but I hope that the Minister will at least amplify it, and not just give us a repeat performance.

I think that my hon. Friend the Member for Somerset, North (Mr. Dean) and the hon. and learned Member for Cardigan (Mr. Bowen) were both right in saying that the basic objection to the earnings rule is that it is widely regarded as unfair, and that we should make Welfare State arrangements that ordinary men and women regard as just. The ordinary citizen does not regard the earnings rule as fair. He may see people drawing pensions from the State which are paid without any earnings rule attached. He does not see why one pension should be singled out for the earnings rule while others are not.

The more we extend job pensions and public service pensions the more glaring this becomes. A pensioner may be subjected to the earnings rule yet know other pensioners, such as policemen or ex-soldiers, who are not subject to it The official explanation is completely unconvincing to him.

8.0 p.m.

There is a subsidiary objection which is also very strong. The existence of the rule leads to a considerable amount of fiddling and tale-bearing. Quite a number of men and women find themselves something to do in order to earn a little more money after retirement. They do not always report it. Now, there are a certain number of people in this country who have what may be called disinterested malevolence. They are malevolent for no perceptible reason. I suppose that every hon. Member has come across them. I have myself. Such people tend to tell tales about men and women drawing pensions and not reporting their earnings.

An old lady helps to wash up in a cafe, or an old gentleman becomes a car park attendant, or a jobbing gardener, in order to earn a little extra money and fails to report it. Then someone writes an anonymous letter and so these pensioners are bothered by inquiries. The whole thing causes a disproportionate amount of tension. For that reason as well as the others it would be good to get rid of the rule.

Who, in fact, wants the rule to stay? Who insists that it shall be there? I assure the hon. and learned Member for Cardigan that he need not have been as timid or as yielding as he was when he asserted that the rule was defended on the ground that, if people were paid pensions without strings, they would offer to work on the cheap. I shall quote from the proceedings of the Labour Party conference at Scarborough last year, when Mr. Nicholas, the party's treasurer, who was then Assistant Secretary of the Transport and General Workers' Union, made it plain that he and the Labour Party insisted on retaining the rule. I have the official report here with me.

I was at the conference—as an observer, not as a delegate—and I can testify that this is an accurate report. Mr. Nicholas was replying to a debate in which the right hon. Lady had taken part and in which a good deal had been said about the earnings rule. He said: … the Labour Party feels that the time has not yet come for the abolition of the rule for all retirement pensioners, though it is prepared to consider the earnings limit and keep it in line with the rising standards of life for other people. Explaining why he was in favour of the rule's retention, he went on: … without the rule the pensions could be a permanent subsidy to wages which in turn can be depressed by the employers and is depressed by them in some places where they escape the vigilance of the trade unions. I would like to know whether the Labour Government stand by those words. Do the Government still feel that the time has not yet come for the abolition of the rule? When this inquiry is set up into the social services—this inquiry which floats over our heads like a slab of ectoplasm in a seance—will those conducting it be told that the Labour Party still feels that the earnings rule must stay? Was the decision made at Scarborough last year binding on the Government?

I do not see why Mr. Nicholas should give orders to the House of Commons even if he can give them to the Labour party. He said that the Labour Party wants to keep the rule. Does that mean that the Labour Government want to keep the rule? There was no Labour Government at the time, but there was this plain declaration from the party's treasurer that the party was in favour of keeping the rule. I want to know whether his statement is the policy of the Labour Government.

The Chancellor of the Duchy of Lancaster (Mr. Douglas Houghton)

I rise to make a few comments on these Amendments in the temporary absence of my right hon. Friend the Minister of Pensions and National Insurance. There is no proposal before the Committee to abolish the earnings rule. The Amendment moved by the hon. Member for Somerset, North (Mr. Dean) proposes to raise the limit by 20s. The Amendment in the name of the hon. and learned Member for Cardigan (Mr. Bowen) would raise the limit by 40s. The hon. Member for Uxbridge (Mr. Curran) proposes that the sky should be the limit. He suggests that the earnings rule should rise from £5 a week to over £5,000 a year.

I do not know whether the hon. Member for Finchley (Mrs. Thatcher) will speak later. If she intends to do so I should like to ask her a pertinent question. If she were still sitting on the Treasury Bench as a member of Her Majesty's Government, would her name appear on an Amendment that would lift the earnings rule at this time? I do not believe that it would, because the rule was last relaxed in March of this year when she was a member of the Government.

The Amendment to which her name is now attached proposes a fresh relaxation of the rule within a matter of months after the last one and I do not believe that she would have moved to increase the earnings limit again already. The abolition of the rule is not the question before the Committee and I do not want to get drawn into the wider issues.

Perhaps one of the useful features of our discussions in Committee today is that the review of which so much has been said is virtually taking place here and now. Some very valuable contributions to contemporary thought on social security have come out in the course of the debate.

For the present it would be wiser for me to do more listening than talking on the future of social security. I shall therefore confine myself to the narrow proposition of the lifting of the earnings rule by 20s. or 40s. or something in that range. Should we relax the rule for retirement pensioners just now? I know that fresh impetus has been given to the desire to relax the rule for retirement pensioners by the abolition of the rule for widows I quite understand that. There is no doubt that the complete abolition of the rule for widows puts in fresh relief the existence of the rule now only for retirement pensioners. Whether that leads one to the conclusion that the rule should be completely abolished for retirement pensioners is a matter for consideration, for discussion and for examination of the consequences and also for examination of the first principles of the scheme itself.

One can distinguish between an earnings rule where retirement is a condition of benefit and an earnings rule which was imposed on widows where retirement was not a condition of receiving the benefit and where the widow was engaged, not in retirement, but in an endeavour to make good the loss of her husband's earnings, so as to maintain the household, the children and herself in a condition at least approaching that to which they had been accustomed. Therefore, in abolishing the rule for widows we have removed the impediment which widows felt stood in the way of their endeavour to replace the earnings of their husbands and also to earn something on their own account. That is a very different condition from that of retirement.

Mr. Curran

Are not the two cases on all-fours? We give benefits to the widowed mother in place of earnings. Under the National Insurance Act the case for giving her benefit was precisely the same as that for giving benefit to the retirement pensioner: it was in place of earnings. To each of these payments the earnings rule was attached for the same condition. If the rule is removed in the one case, where is the logic in keeping it in the other?

Mr. Houghton

Unless I am careful, I shall get drawn into a field of discussion which I want to keep out of. The position of the retirement pensioner is not on all-fours with that of the widow. A widow's benefit is not to replace her own earnings but her husband's earnings. The retirement pension is to replace a person's own earnings. That is the difference in principle between the two. I hope that hon. Members will let me get out of this field of discussion as quickly as I can. If I am interrupted further, I shall be bound to pursue commentators and adversaries who may pop up and incite me to further discussion on the principle of the earnings rule. I do not want to do that, because I think that it is desirable for all of us to keep a perfectly open mind on this and other aspects of our existing social security scheme if we are to enter into the review with any chance of profitable activity.

Therefore, I shall not say a word today which commits the Government to the retention of the earnings rule in a future and revised scheme of social security, nor shall I say a word in support of its removal. It is there at the moment. The Amendment proposes to relax it and not to remove it. I think I should come now to the suggestion of relaxation.

8.15 p.m.

It is unusual for any change in the earnings rule to be made in a Bill increasing all benefits. The last time it was done within the framework of a National Insurance Bill at the same time as a general increase in benefit rates was by a Labour Government as long ago as 1951. The earnings rule is normally dealt with by Regulations which are introduced separately from a National Insurance Bill. In 1963 the two things came together, but that was quite coincidental, because a review had been undertaken by the National Insurance Advisory Committee, whose report came forward, and it was convenient to do the two things at the same time. It is not unknown for them to be done together, though I do not say that matters very much. But it is not necessary for them to be done together, and that perhaps matters rather more. There is no need to include this in the Bill at this moment and by leaving it out it leaves the Government free to introduce any relaxation of the earnings rule whenever they may think it is appropriate in future and it would not require any fresh Regulation. As the Committee knows, under earlier legislation the earnings rule can be relaxed by Regulation, though it cannot be abolished in that way. If the Committee proposes to abolish the rule, it must be done by legislation. Relaxations can be made by Regulations.

The normal reason for relaxing the earnings rule is to keep the condition of the rule in harmony with the rise in wages, to keep the two things in some sort of relationship. The Committee will appreciate that wages have not risen since March of this year by an amount which would justify relaxing the rule by 20s. at this moment—not on that principle, at any rate. Usually relaxations are of 10s. or 15s. One pound is a big jump. Forty shillings is a bigger jump still and would be far more than an adjustment of the earnings rule to keep in step with a rise in earnings. It would really be, as the hon. and learned Member for Cardigan candidly confessed, a jump towards abolition. It was in that spirit that he referred to the Liberal Party's Amendment No. 21, and supported it by arguments in favour of abolition and not in favour even of the increase proposed in that Amendment.

We can therefore reject a suggestion that the earnings rule needs to be relaxed at this time to keep in harmony with changes in the level of wages. I hope that that is accepted, because it must be so. This is a far bigger increase than would be justified by that criterion.

By what criterion is it now proposed to relax the earnings rule? If it is by reference to the abolition of the rule for widows, I do not think that the one thing should be regarded as influencing the other. We have reached our decision on the abolition of the rule for widows without in any way prejudicing our view about the retention of the rule for retirement pensioners. We have not proposed to remove it in the Bill. That will have to wait for consideration later when we come to the major review.

If it is proposed to alter the earnings rule in a manner which is a challenge to the principle of the rule, that prejudices future discussion. It is an admission that we want to move towards the total abolition of the rule, without stopping to think whether that would be a suitable feature of a new social security scheme. Therefore, I suggest that it would be unwise for the Committee to jump its fences on this question of principle, in view of its wider importance in the scheme as a whole. We must look at this quite narrowly at the moment and decide whether the earnings rule should be adjusted now in the light of the usual criteria by reference to which the earnings rule has mostly been altered in the past.

That is all I have to say on the earnings rule. I hope that the Committee will feel that it is a sufficiently plausible case for doing nothing with the earnings rule at the moment. [HON. MEMBERS: "Oh."] There is nothing wrong with being plausible. The trouble with hon. Members opposite is that they are mostly so implausible. It is a perfectly good case to be going on with—and we will be going on with our major review.

I emphasise that this review will be carried out by the Government. This is what we are here for. This is what we were elected to do. This is what we said we would do. I do not want to leave the Committee under any misapprehension about what our immediate intentions are. The Government are undertaking this review with the resources available to us. It is not at present intended to put the matter out to examination by another body, whether a Royal Commission or some kind of Departmental Committee, with outside members.

Still less would it be our desire to have the sort of review Beveridge carried out during the war. Much has been said about the Beveridge Report, but it will be remembered that Beveridge produced that Report single—handed. He had the assistance of able lieutenants and a great deal of evidence presented to him on which he could draw in formulating his proposals, but it was an unusual method of making a report on an extremely important change in social policy. The conditions of the war militated against the usual review by the Government. It was undertaken in quite exceptional circumstances by an exceptional method and I do not think that there is any need for us to copy that now. We can get on with the job.

We have expressed, in various publications, our main theme of social security. We have developed it and have said where we want to go. We have outlined our concept of social security as we see it and this major review is in line with what we have announced as our major policy on social security. That does not mean that, on further examination, we need necessarily be committed to every feature of the schemes we have already outlined in "National Superannuation" or "New Frontiers of social security."

We have flexible minds on the question of social security. We want to adapt it to contemporary conditions. Nearly everything in the sphere of social security today may be out of date in five or 10 years' time. Thinking is changing rapidly on social matters and, as I said on a previous occasion, when looking at social security today we are not looking at it in the 'sixties but in the 'seventies. We must look ahead.

It will take time for new schemes to be fully operative, though I hope it will not be years before our proposals are available. We are thinking of a much shorter time. Major legislation will be required and there will be the very large question of how the whole scheme is to be financed in present day conditions. I mention that to dispel what I thought was the growing expectation that this review was to be something mounted in a spectacular and dramatic way, with lists of people being announced to do the job, evidence being solicited, witnesses seen and so on. No witnesses are ruled out and no help will be discouraged. Nevertheless, this review is being undertaken by the Government and we propose to proceed with it on those lines.

Lieut.-Commander Maydon

Will the right hon. Gentleman be a little more forthcoming about the review? He said that it will be a Government review, that it will not be a Royal Commission review, that it will not have an independent chairman but that outside witnesses will be welcomed. Will it, therefore, be a sort of inter-departmental review, with the addition of outside bodies to bear witness and give opinions?

Mr. Curran

Will the review be conducted by members of the Civil Service, Members of Parliament, or some other kind of third party?

Mr. Houghton

As the Committee knows, I have special responsibilities in this matter. That is why I am here. I propose to discharge these responsibilities and, frankly, I think that I have as good a head for social security matters as anyone inside or outside the Committee. I intend to bring my experience, imagination and, if I may say so, drive and initiative to bear on this problem. I believe that it can be conducted within the resources of the Government, with us availing ourselves of such help as may be offered or sought by us. I do not want to go further.

We are doing the job. Hon. Members need not expect to see that something different is being done. I hope that, with these remarks, we may now dispose of the Amendment. I sincerely trust that hon. Members opposite will not press it to a Division because I hope that I have given a full explanation of the reasons why the earnings rule should be left alone at the moment. That does not mean that the Government would hesitate, for we would not, to bring forward regulations to relax the earnings rule as soon as it seemed appropriate to do so.

Sir K. Joseph

I do not want to delay the Committee on this Amendment for longer than necessary. The right hon. Gentleman has just made a very important statement and I want to reserve the right of my hon. Friends for future comment on it. We do not for a moment question the good will and integrity of the right hon. Gentleman, as well as the power of his intellect and knowledge. But, after all, if the right hon. Gentleman is offering himself and all his good will, integrity and intelligence as the principal—I am not quite clear whether the only—investigator of social security, we must point out that he and his hon. Friends have in Opposition, admittedly without the resources of Government, made a number of attempts to find the real answer for contemporary needs in social security. Each time they have produced an answer it has been projected as a panacea, only to be replaced within months or a few short years by yet another attempt.

Miss Herbison

Not true.

Sir K. Joseph

That is why my hon. Friends and I feel, as we proclaimed in our manifesto, that what is needed is something, a body or group of people, to consider the evidence and views of representative bodies and people whose interests are deeply involved with the social security of the country. I do not wish now to enlarge on this matter, because we are dealing with an important Amendment, but I want to follow up what the right hon. Gentleman said by saying that we regard his statement as most important and that we shall want on a future occasion to comment on it more fully.

Miss Herbison

I must take up one point which the right hon. Member for Leeds, North-East (Sir K. Joseph) made. He suggested that plan after plan had come from the Labour Party on the question particularly of social security and superannuation. The right hon. Gentleman is quite wrong, and he must know that he is wrong. The programme for superannuation on which we fought the election in 1959 was exactly the same as the programme on which we fought this year's election.

Sir. K. Joseph

That is just not true.

Miss Herbison

It is true.

Sir K. Joseph

When I first became a Member of the House, I debated on the radio a previous incarnation of this plan with the present Minister of Housing and Local Government. That was not the first plan. It has been followed by yet another. In all five separate panaceas for social insurance have been proposed.

Miss Herbison

Quite wrong.

Sir K. Joseph

This is not discreditable. It represents hard work by right hon. and hon. Members opposite. I am only commenting that it shows the fallibility of individuals operating without the benefit of public evidence and public participation.

Question proposed, That those words be there inserted:—

The Committee divided: Ayes 138, Noes 174.

Division No. 27.]	AYES	[8.30 p.m.
Agnew, Commander Sir Peter	Elliott, R.W.(N'c'tle-upon-Tyne,N.)	Mackenzie, Alasdair(Ross & Crom'ty)
Alison, Michael (Barkston Ash)	Fletcher-Cooke, Charles (Darwen)	Macleod, Rt. Hn. Iain
Allason, James (Hemel Hempstead)	Fletcher-Cooke, Sir John (S'pton)	Mathew, Robert
Anstruther-Gray, Rt. Hn. Sir W.	Gammans, Lady	Mawby, Ray
Balniel, Lord	Gardner, Edward	Maxwell-Hyslop, R. J.
Barlow, Sir John	Gibson-Watt, David	Maydon, Lt.-Cmdr. S. L. C.
Batsford, Brian	Giles, Rear-Admiral Morgan	Meyer, Sir Anthony
Bell, Ronald	Glover, Sir Douglas	Mills, Stratton (Belfast, N.)
Bennett, Dr. Reginald (Gos & Fhm)	Glyn, Sir Richard	Mitchell, David
Bessell, Peter	Goodhew, Victor	Monro, Hector
Biffen, John	Grant, Anthony	Morgan, W. G.
Biggs-Davison, John	Grant-Ferris, R.	Morrison, Charles (Devizes)
Bingham, R. M.	Griffiths, Peter (Smethwick)	Mott-Radclyffe, Sir Charles
Black, Sir Cyril	Grimond, Rt. Hn. J.	Murton, Oscar
Blaker, Peter	Gurden, Harold	Nicholson, Sir Godfrey
Bowen, Roderic (Cardigan)	Hall, John (Wycombe)	Nugent, Rt. Hn. Sir Richard
Brewis, John	Hall-Davis, A. G. F.	Onslow, Cranley
Brinton, Sir Tatton	Harris, Frederic (Croydon, N.W.)	Osborn, John (Hallam)
Brooke, Rt. Hn. Henry	Harris, Reader (Heston)	Osborne, Sir Cyril (Louth)
Brown, Sir Edward (Bath)	Harrison, Brian (Maldon)	Page, John (Harrow, W.)
Bullus, Wing Commander Sir Eric	Harrison, Col. Sir Harwood (Eye)	Page, R. Graham (Crosby)
Burden, F. A.	Hawkins, Paul	Percival, Ian
Butcher, sir Herbert	Heald, Rt. Hn. Sir Lionel	Peyton, John
Carlisle, Mark	Hendry, Forbes	Pickthorn, Rt. Hn. Sir Kenneth
Carr, Rt, Hn. Robert	Hill, J. E. B. (S. Norfolk)	Pitt, Dame Edith
Chataway, Christopher	Hobson, Rt. Hn. Sir John	Prior, J. M. L.
Chichester-Clark, R.	Hornsby-Smith, Rt. Hn. Dame P.	Pym, Francis
Cole, Norman	Howard, Hn. G. R. (St. Ives)	Quennell, Miss J. M.
Cooke, Robert	Hutchison, Michael Clark	Redmayne, Rt. Hn. Sir Martin
Corfield, F. V.	Iremonger, T. L.	Roberts, Sir Peter (Heeley)
Costain, A. P.	Irvine, Bryant Godman (Rye)	Rodgers, Sir John (Sevenoaks)
Crawley, Aidan	Jennings, J. C.	Royle, Anthony
Crowder, F. P.	Johnston, Russell (Inverness)	Russell, Sir Ronald
Curran, Charles	Jones, Arthur (Northants, S.)	Sharples, Richard
Dance, James	Jones, Rt. Hn. Aubrey (Hall Green)	Shepherd, William
Dean, Paul	Kaberry, Sir Donald	Sinclair, Sir George
Deeds, Rt. Hn. W. F.	Kerr, Sir Hamilton (Cambridge)	Smith, Dudley (Br'ntf'd & Chiswick)
Donaldson, Cmdr. C. E. M.	Lambton, Viscount	Taylor, Edward M. (G'gow,Cathcart)
Doughty, Charies	Legge-Bourke, Sir Harry	Taylor, Frank (Moss Side)
Drayson, G. B.	Longden, Gilbert	Thatcher, Mrs. Margaret
du Cann, Rt. Hn. Edward	Lubbock, Eric	Thompson, Sir Richard (Croydon,S.)
Eden, Sir John	McAdden, Sir Stephen	Thorpe, Jeremy
Turton, Rt. Hn. R. H.	Walker, Peter (Worcester)	Woodhouse, Hn. Christopher
Tweedsmuir, Lady	Walker-Smith, Rt. Hn. Sir Derek	Younger, Hn. George
van Straubenzee, W. R.	Ward, Dame Irene
Vaughan-Morgan, Rt. Hn. Sir John	Whitelaw, William	TELLERS FOR THE AYES:
Vickers, Dame Joan	Wilson, Geoffrey (Truro)	Mr. MacArthur and Mr. Ian Fraser.
NOES
Alldritt, W. H.	Harper, Joseph	Oswald, Thomas
Armstrong, Ernest	Hart, Mrs. Judith	Owen, Will
Atkinson, Norman	Hattersley, Ray	Page, Derek (King's Lynn)
Bacon, Miss Alice	Hayman, F. H.	Paget, R. T.
Bagier, Gordon A. T.	Hazell, Bert	Pannell, Rt. Hn. Charles
Bence, Cyril	Herbison, Rt. Hn. Margaret	Pentland, Norman
Bennett, J. (Glasgow, Bridgeton)	Holman, Percy	Perry, E. G.
Bishop, E. S.	Horner, John	Popplewell, Ernest
Blackburn, F.	Houghton, Rt. Hn. Douglas	Prentice, R. E.
Blenkinsop, Arthur	Howarth, Robert L. (Bolton, E.)	Probert, Arthur
Boston, T. G.	Howie, W.	Pursey, Cmdr. Harry
Bowden, Rt. Hn. H. W. (Leics S.W.)	Hughes, Emrys (S. Ayrshire)	Rhodes, Geoffrey
Boyden, James	Hughes, Hector (Aberdeen, N.)	Roberts, Goronwy (Caernarvon)
Braddock, Mrs. E. M.	Hunter, Adam (Dunfermline)	Robertson, John (Paisley)
Buchanan, Richard	Hunter, A. E. (Feltham)	Rodgers, William (Stockton)
Butler, Herbert (Hackney, C.)	Irving, Sydney (Dartford)	Rogers, George (Kensington, N.)
Butler, Mrs. Joyce (Wood Green)	Jeger, George (Goole)	Rose, Paul B.
Carter-Jones, Lewis	Jeger,Mrs.Lena(H'b'n&St.P'cras,S.)	Shore, Peter (Stepney)
Coleman, Donald	Jenkins, Hugh (Putney)	Short,Rt.Hn.E.(N'c'tle-on-Tyne,C.)
Conlan, Bernard	Jones, Rt. Hn. Sir Elwyn(W.Ham,S.)	Short, Mrs. Renée (W'hampton,N.E.)
Corbet, Mrs. Freda	Kenyon, Clifford	Silkin, John (Deptford)
Crawshaw, Richard	Kerr, Mrs. Anne (R'ter & Chatham)	Silkin, S. C. (Camberwell, Dulwich)
Crossman, Rt. Hn. R. H. S.	Kerr, Dr. David (W'worth, Central)	Silverman, Julius (Aston)
Cullen, Mrs. Alice	Lawson, George	Silverman, Sydney (Nelson)
Dalyell, Tam	Ledger, Ron	Skeffington, Arthur
Darling, George	Lee, Miss Jennie (Cannock)	Slater, Mrs. Harriet (Stoke, N.)
Davies, Harold (Leek)	Lever, L. M. (Ardwick)	Slater, Joseph (Sedgefield)
Davies, Ifor (Gower)	Lewis, Ron (Carlisle)	Small, William
Dell, Edmund	Lomas, Kenneth	Solomons, Henry
Dempsey, James	Loughlin, Charles	Sorensen, R. W.
Doig, Peter	McBride, Neil	Soskice, Rt. Hn. Sir Frank
Driberg, Tom	MacColl, James	Spriggs, Leslie
Duffy, Dr. A. E. P.	McGuire, Michael	Stones, William
Dunn, James A.	McInnes, James	Strauss, Rt. Hn. G. R. (Vauxhall)
Dunnett, Jack	MacKenzie, Gregor (Rutherglen)	Summerskill, Dr. Shirley
Edelman, Maurice	Mackie, John (Enfield, E.)	Swain, Thomas
Edwards, Robert (Bilston)	McLeavy, Frank	Symonds, J. B.
English, Michael	MacMillan, Malcolm	Taverne, Dick
Ennals, David	MacPherson, Malcolm	Taylor, Bernard (Mansfield)
Ensor, David	Mahon, Peter (Preston, S.)	Thornton, Ernest
Evans, Albert (Islington, S.W.)	Mallalieu, E. L. (Brigg)	Tinn, James
Evans, Ioan (Birmingham, Yardley)	Manuel, Archie	Tuck, Raphael
Fernyhough, E.	Mapp, Charles	Urwin, T. W.
Fletcher, Sir Eric (Islington, E.)	Mendelson, J. J.	Varley, Eric G.
Fletcher, Ted (Darlington)	Mikardo, Ian	Walden, Brian (All Saints)
Fletcher, Raymond (Ilkeston)	Millan, Bruce	Walker, Harold (Doncaster)
Floud, Bernard	Miller, Dr. M. S.	Wallace, George
Foot, Sir Dingle (Ipswich)	Milne, Edward (Blyth)	Warbey, William
Foot, Michael (Ebbw Vale)	Molloy, William	Wells, William (Walsall, N.)
Garrett, W. E.	Morris, Alfred (Wythenshawe)	Whitlock, William
Garrow, A.	Morris, Charles (Openshaw)	Willey, Rt. Hn. Frederick
Ginsburg, David	Neal, Harold	Williams, Mrs. Shirley (Hitchin)
Gourley, Harry	Newens, Stan	Williams, W. T. (Warrington)
Gregory, Arnold	Noel-Baker, Francis (Swindon)	Willis, George (Edinburgh, E.)
Griffiths, Rt. Hn. James (Llanelly)	Noel-Baker,Rt.Hn.Philip(Derby,S.)	Winterbottom, R. E.
Hale, Leslie	Norwood, Christopher	Woof, Robert
Hamilton, James (Bothwell)	Ogden, Eric
Hamilton, William (West Fife)	Orbach, Maurice	TELLERS FOR THE NOES:
Hamling, William (Woolwich, W.)	Orme, Stanley	Mr. McCann and Mr. Fitch.

Mrs. Thatcher

I beg to move Amendment No. 8, in page 2, line 43, at the end to add: (9) Death grant shall be payable in respect of any person who at the time of his death is severely mentally handicapped and has been so since childhood, notwithstanding that at the time of his death he was over the age of nineteen years. This is a probing Amendment about a problem which arose towards the end of my time on the other side of the Committee and in which I know that the right hon. Lady, particularly, was very interested, as were, indeed, a number of other hon. Members because they had individual cases on this very matter.

The difficulty has been that of paying death grant in respect of a person who never effectively entered insurance. I have restricted this Amendment to those children who are severely mentally handicapped and who, although, they grow up, never attain any age beyond the mental age of a child. Should one of those children die, then up to the age of 19 he is covered for death grant purposes on the parent's insurance. Should the child die beyond the age of 19 a very real problem arises, as was shown in the case of such a child of a widow.

The widow was not earning very much—I believe about £10 a week—when one of her children, then aged 20, who had been severely mentally handicapped and who had never been capable of entering ordinary life, died. She applied for a death grant but could not get one. Had the child died below the age of 19 she would have obtained a death grant in respect of the child on her own insurance, but she could not get one because the child was over the age of 19.

We tried various ways to help her. We investigated the position through National Assistance, because, normally, as soon as they are eligible for National Assistance, from the age of 16, these young people apply for and receive National Assistance. They do not pay insurance stamps because they come under the small income exemptions. But we found that there is no power whatever in the National Assistance Act to pay a grant in respect of a person who has died except through a living person who is herself in need. Had that widow herself been on National Assistance she would have been a person in need and could have claimed some help from National Assistance to meet the funeral expenses. But National Assistance has no power to pay a terminal grant in respect of a person who, although on National Assistance during life, has just died.

Investigating this problem, therefore, we were driven back to try to find a solution within the National Insurance Scheme. We tried the possibility of making the death of such a child eligible for death grant on his or her parents' insurance. But frequently such a child dies after the parents have died. This would have meant keeping records in existence for a very long time. It also meant that if a mentally handicapped person were living with another relative, that other relative would probably not have been able to claim had death grant been dependent upon the parents' insurance. That line of investigation, like that of National Assistance, was ruled out.

It seemed that one of the few lines left, which I feel the right hon. Lady is pursuing, was to try to reduce the contribution conditions for death grant to such a point for these people that they could easily become entitled to a death grant. There is one analogy already in the insurance scheme. Although it is an insurance scheme—that is to say, benefits are payable only in return for contributions—there is one case within the scheme in which benefits can be obtained without so much as a single contribution having been paid. That benefit is the orphans' or guardians' benefit, when the child entitled a person to guardians' benefit if the parent of the orphan child was himself or herself an insured person. Being an insured person means no more than having been a British national and in this country at some time between school-leaving age and retirement age. If the parent of an orphan were an insured parent but had paid no contributions then the orphan would attract guardians' allowance, at the moment 37s. 6d. and under the Bill 40s.

It seemed that the test of being an insured person would be one test whereby the mentally severely handicapped person could enable someone else to draw a death grant in the event of that handicapped person's death. I am aware that if one substitutes this test one can run into difficulty. It would have to be substituted for a very narrow range of people, such as the severely mentally handicapped, and it would be difficult to define that group. What is a severely mentally handicapped child? One which has been handicapped since birth or one which by some accident has become severely mentally handicapped? If one followed the test of being an insured person it would have to be narrowly defined. Many people are excluded from the death grant provision because they were too old when the scheme was brought into existence or because they were within 10 years of retirement age. If such a person were substituted so as to qualify for benefit, this would put up the cost of the measure very considerably.

It seems that if we can possibly get a narrowly defined test confined to those people who for one reason or another—severely mentally handicapped or severely physically handicapped—were never able effectively to become contributors to insurance, we might reach some solution to the problem. If we confined it to this small group of people the cost would be negligible. This is in no sense an expensive measure. But if we cannot confine it, the cost would be considerable. I ask the right hon. Lady, as I am sure she will, to carry on trying to find a solution to this problem of enabling severely mentally handicapped children to qualify persons who are in charge of them for a death grant when the severely mentally handicapped person dies.

Mr. Pentland

We are all deeply concerned about the position of the unfortunate people referred to by the hon. Lady the Member for Finchley (Mrs. Thatcher), and referred to also in the Amendment. We are right to be concerned about this problem and it is one which I think everyone will agree will always have to be approached with sympathy and understanding. The Government intend to approach it in that way, and I have taken note of what the hon. Lady said.

I was impressed by the hon. Lady's moderate tone in moving the Amendment because, having sat here since half past three this afternoon, it has been nauseating to see the tremendous feeling now being expressed by some hon. Members on the benches opposite about the problems and anomalies which exist in the social security scheme. I find that absolutely hypocritical in many respects. As my right hon. Friend said a few hours ago, the Government have been in office for only a few weeks, yet we are being asked to solve problems and deal with anomalies which have existed for many years, and were known to exist by the previous Government.

I was informed, and the hon. Lady has now made it perfectly clear, that over the years considerable investigations have been undertaken to find possible ways and means of making provision for the payment of a death grant on the death of permanently handicapped children. Incidentally, I was pleased that she pointed this out in her remarks, be- cause the Amendment refers only to a mentally handicapped person and makes no definition of that term. It omits the possibility of making provision for physically handicapped children, and, therefore, its effect would be very restrictive indeed.

As the hon. Lady said, the problem here is not primarily one of expense at all—far from it. There are estimated to be only about 3,000 such deaths a year. The real difficulty here—and the hon. Lady referred to it—is to decide how the Government can make provision for the payment of a death grant on the death of a permanently handicapped person without bringing in its train considerably wider changes. This is a question to which we will have to find a solution.

I do not want to weary the Committee. The hon. Lady was brief, and asked for certain assurances, so I shall not go into detail about what the changes would mean. I assure the Committee that they would be far-reaching, with implications much wider than in the field of death grant benefits, and I am sure that the hon. Lady, with her experience of these matters, appreciates that.

In the short time that we have had available to us we have examined this problem very carefully indeed, and we have found, as the previous Government did, that it is a difficult one to solve. I am not going to say this evening that we have found a solution to it. My right hon. Friend, and all those associated with her, are deeply concerned about it. We want to find a solution—make no mistake about that—and we are determined to find one if it is at all possible. We want to assure the Committee that we shall embark upon a detailed study of this matter. This will not be brought within the ambit of the major review. It will be an independent study into this problem.

We approach this question with sympathy and understanding. We are hoping that as a result of our investigation the prevailing difficulties, which are now understood by all hon. Members, can be finally overcome. In the meantime, I would ask the hon. Lady and her hon. and right hon. Friends to accept that assurance and withdraw the Amendment, otherwise I must invite the Committee to reject it.

Mrs. Thatcher

I shall be quite happy to withdraw the Amendment. I am aware that had the Parliamentary Secretary been able to find the solution it would probably have been in the Bill, as was the right hon. Lady's solution of the home confinement grant and the maternity grant. I was a little disappointed that the solution to this problem was not in the Bill, but we shall be having a consolidating Measure later, presumably, and I hope that it will then not be out of order to put one or two things like this into that Measure. I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Question put, That the Clause stand part of the Bill.

Dame Edith Pitt (Birmingham Edgbaston)

Before we leave this Clause will the Minister tell me why the age of retirement, or pensionable age as the Bill puts it, for a widow goes up to 65, but still remains at 60 for a single woman?

Miss Herbison

The answer to that is very simple. On Second Reading, I gave the explanation. If the earnings rule is abolished for widows, as it will be under the Bill, and we do nothing about raising the age from 60 to 65, it would be treating this subject in a cat and mouse way. The widow would have her earnings without any deduction at all until she was 60 and a week after she was 60 she would have a decrease because of her earnings. The proposal in the Bill seems to us the most humane way of dealing with this matter.

Dame Edith Pitt

I understand the point that the Minister has just repeated, but I want everyone to be clear now that the normal retirement age for a widow is 65 and for a single woman is 60. I think that this is wrong and I hope that it is one of the points that will be borne in mind by the Committee.

Question put and agreed to.

Clause ordered to stand part of the Bill.

Clauses 2 to 6 ordered to stand part of the Bill.