HC Deb 24 May 1965 vol 713 cc1-6
1. Mr. Russell Johnston

asked the Minister of Pensions and National Insurance if she will abolish the wage stop.

4. Mr. Curran

asked the Minister of Pensions and National Insurance whether she has now reviewed the operation of the wage stop in the payment of National Assistance; and what steps she will take.

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

The problem of the wage stop is one of the matters that is being examined in the Government's review of social security schemes and I shall not be able to say what steps, if any, may be taken on it until the review is completed.

Mr. Johnston

While I appreciate what the hon. Gentleman says, I trust that it does not in any way indicate that the views highly critical of the wage stop expressed by members of his party before the election will change. Secondly, may I express the hope that he will bear in mind closely that it is a highly unsatisfactory state of affairs that the wage stop brings the level of assistance below what is regarded by the National Assistance Board as the minimum?

Mr. Pentland

My right hon. Friend and I are fully alive to all that is involved in the wage stop. But the wage stop and the difficulties created by it form only a small part of the general problem that the income of many low wage earners, with medium-sized or large-sized families, is already below the National Assistance level. This problem is currently under examination by an official inter-departmental committee.

Mr. Curran

Can the hon. Gentleman tell us how many people have been hit by the wage stop over the last six months? Will he give his opinion on the state of affairs under the Labour Government which permits so many workers to be earning wages lower than the sum which the National Assistance Board thinks necessary for subsistence?

Mr. Pentland

The hon. Gentleman's Government allowed it to exist for 13 years. We are already doing something about it. This is the reason for the review and why the official inter-departmental committee is already actively working on it. On the other part of the hon. Gentleman's supplementary question, at the most recent count, at the end of March, 1965, the assistance grants in payment to approximately 19,000 unemployed men were affected by the wage stop out of a total of 121,000 unemployed people receiving National Assistance.

Mr. Rhodes

I welcome the review, but is my hon. Friend aware that in recent years earnings on Tyneside have tended to drop behind those in other parts of the country, and, consequently, families living on National Assistance in that area tend to have, because of the wage stop, a lower standard of living than those in other parts of the country? Is there any evidence that the retention of the wage stop policy forces people to seek work? Would my hon. Friend bear in mind that there are relatively few unemployable layabouts in the Tyneside area anyway?

Mr. Pentland

I entirely agree with my hon. Friend. As he is aware, I am fully alive to the problems facing people in the north-east of England. My constituency is there. We are fully conscious of all the problems involved in the wage stop, and we are looking at the matter very carefully.

18. Mr. Derek Page

asked the Minister of Pensions and National Insurance how many applicants for National Assistance in the King's Lynn area are affected by the wage stop; what proportion this is of the total; and how these figures compare with the national average figures.

Mr. Pentland

On 30th March, 1965, the latest date for which information is available, there were 89 unemployed people whose assistance allowances were affected by the wage stop in the area covered by the King's Lynn office of the National Assistance Board. This was 1½ per cent. of the total number of people receiving assistance in that area. In Great Britain as a whole 19,310 unemployed persons were similarly affected, just under 1 per cent. of all persons receiving assistance allowances.

Mr. Page

I am most grateful to my hon. Friend for those figures, which I am sure he will realise bear out the fact that this iniquitous rule bears most hardly on areas of low earnings, such as Norfolk. Will he kindly bear that in mind, and will he also bear in mind the fact that recent rent rises have brought many of the lower-paid workers, such as farm workers, below the National Assistance level? Will he urgently consult his right hon. Friend the Minister of Housing and Local Government so that these poor people are not penalised further for their poverty?

Mr. Pentland

I share my hon. Friend's concern, and I assure him that, once again, we are fully alive to the problems involved in this question.

20. Mr. Rhodes

asked the Minister of Pensions and National Insurance whether she will take steps to see that the wage stop on assistance grants is based in future not on the basic wage, but on the average earnings of the individual when in employment.

Mr. Pentland

The wage stop on a National Assistance grant is in fact based on earnings; it is calculated by reference to a man's probable gross earnings, including any overtime or bonus, in his normal occupation.

Mr. Rhodes

Is my hon. Friend fully satisfied that all local officers of the National Assistance Board are aware of this? Is there any discretionary power left to local managers in this respect?

Mr. Pentland

Not to my knowledge, but, here again, if my hon. Friend knows of any difficulty regarding the ascertainment of the wage stop level—I know that he is particularly interested in the matter—I should be glad if he would send me the details.

26. Mr. Bence

asked the Minister of Pensions and National Insurance what is the present wage stop level for non-skilled labour in Scotland.

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

The figure that is taken by the National Assistance Board for wage stop purposes is based on the individual's normal occupation and the prevailing rate of earnings in that occupation in the district in which he lives. There is consequently no common figure for Scotland.

Mr. Bence

Is my right hon. Friend aware that the figure which is now being used in Scotland—at least in the Clyde Valley—is the same as was used 12 months ago although, in the last six months, earnings of labourers in the Clyde Valley have been rising? Will she give a general direction that the wage stop level should also be raised?

Miss Herbison

Certainly it is important that such information should be brought to my notice. I shall certainly bring it immediately to the notice of the National Assistance Board, since its officers throughout the country have to have regard to what could be earned by a man in his own area and not in the country as a whole. This point will certainly be brought to the notice of the National Assistance Board. It has been made clear today that we are seriously worried about the question of the wage stop, and pending the completion of the review I should not want it to be any more harsh than it need be.

Mr. Rhodes

Will my hon. Friend mike it clear that the principles of the operation of the wage stop are not within the command or discretion of local managers? What efforts will she make to see that they are aware of this fact?

Miss Herbison

Again, it has been made clear today by my hon. Friend that these principles are not within the jurisdiction of the managers. They have to work according to these principles and it is these principles—and especially the result of them upon the children of these people—that give us very great worry.

Sir Knox Cunningham

Why has not the right hon. Lady got the information al out this subject—information which she now says that she will try to obtain?

Miss Herbison

We have known all along about the occasional harshness of the operation of the wage stop. That was evident by the attention that we gave it when in opposition. It is because we know of its harshness that, in the review, we are determined to find a remedy, especially one which will make things less hard for the children both of employed and unemployed low-wage earners.