HC Deb 08 August 1966 vol 733 cc982-4
1. Mr. Boyd-Carpenter

asked the Minister of Social Security what proposals she has to protect retirement pensioners from the effects of recent Government measures.

The Minister of Social Security (Miss Margaret Herbison)

The measures recently announced are intended to stabilise prices and strengthen the economy. Like all other members of the community, pensioners stand to gain from them. Retirement pensioners are still appreciably better off as a result of the measures introduced since we took office, and the least well-off among them will benefit from the provisions of the Ministry of Social Security Act which are due to come into force later this year.

Mr. Boyd-Carpenter

While offering the right hon. Lady good wishes in her newly-designated office, may I ask her whether she is aware that the Selective Employment Tax will raise the cost of food and that the use of the regulator will raise the cost of other necessities? Cannot she hold out some hope that the most vunerable sections of the community will be protected against the consequent price increases?

Miss Herbison

It is expected that the measures which the right hon. Gentleman has mentioned may bring about an increase of 1½ per cent. in the index of retail prices—that is, a little over 1s. on the single pensioner rate. But the fact that the Government have taken measures to stabilise the prices of goods and services will benefit pensioners almost more than anyone else in the country.

Sir Knox Cunningham

The right hon. Lady expects that the percentage increase will be 1½ per cent. If it is much more, will she take action and give assistance?

Miss Herbison

The hon. and learned Gentleman has not paid attention to the second half of my reply, that the other steps which the Government have proposed will protect the pensioners.

15. Mr. Maurice Macmillan

asked the Minister of Social Security what would be the rates of National Insurance retirement pensions at the latest available date if these rates had been linked to average male industrial earnings following the last pensions increase.

Miss Herbison

On the basis of the Ministry of Labour's inquiries into average earnings in April, 1965, and April, 1966, 85s. 8d. for a single person and 139s. 3d. for a couple.

Mr. Macmillan

Does not the right hon. Lady realise that, in allowing the pension to drop so much in purchasing power at a time when wages are increasing, she is allowing the Government to be in direct breach of their election pledges, which stated that not only would the pension be raised, but the higher level of the pensioner would be maintained as a priority, despite any economic difficulty?

Miss Herbison

The hon. Member will be aware that, in spite of our economic difficulties, no step has been taken to interfere with the social priorities for those in greatest need. He may not be aware that, between April, 1965, and April, 1966, the average earnings rose by just over 7 per cent. In a period for which his own Government were responsible, April, 1955, to April, 1956, they rose by a greater amount, by 8 per cent., yet it was not until 1958 that his Government decided to raise the pensions. I can assure him that we shall do better than that.

Mr. Boyd-Carpenter

Is it not a fact that, over the whole period of Conservative rule, the rate of pensions and the real value of pensions rose considerably more, in terms of percentages, than earnings?

Miss Herbison

It is true during that period, but we had to wait for the return of a Labour Government to give them, compared with average earnings, a little more than they had had in 1946.

Mr. Manuel

Would my right hon. Friend remember that average male industrial earnings fluctuate according to the amount of overtime worked in industry and that it would be a wrong principle to tie ourselves to this absolutely, as there can be a drop?

Miss Herbison

This is very true, but until this present moment, it has been much better to tie the pensions to average earnings than to increases in the cost of living. Old people do much better.