SOCIAL SECURITY (SUPPLEMENTARY BENEFIT)

HC Deb 12 July 1968 vol 768 cc897-938

11.4 a.m.

The Joint Parliamentary Secretary to the Ministry of Social Security (Mr. Norman Pentland)

I beg to move, That the Supplementary Benefit (Determination of Requirements) Regulations 1968, a draft of which was laid before this House on 18th June, be approved. The draft regulations provide for increases in the rates of supplementary benefit in accordance with the pledge given by my right hon. Friend the Prime Minister on 16th January last that the most vulnerable classes of the community would be protected against hardship resulting from those price increases which must result from the effects of devaluation on import costs. The increases are timed to come into effect on 7th October in the same week as the increases in family allowances which have already been approved by the House.

This will be the fourth increase in non-contributory benefits since the Government took office and represents the latest step in the Government's work of improving benefits for those who cannot support themselves and whose income would otherwise fall below a reasonable standard. They show that, even in times of economic difficulty, we are determined to hold on to what has been achieved since 1964 and where possible to make further improvements.

The main proposals are for an increase of 5s. in the single householder rate and of 8s. in the married couple rate, resulting in new rates of £4 11s. and £7 9s. a week respectively, to which, of course, is. added provision for rent. For adult non-householders, there is proposed an increase of 3s. on the scale rate plus an increase of 1s. on the fixed rent addition, making a total increase of 4s. Increases are also proposed in the rates for children and for blind people.

The Government have not confined themselves simply to making compensatory proposals for increases in benefit rates, but have considered whether there were other parts of the supplementary benefit scheme where improvements would be particularly helpful. As a result, we are proposing two other changes.

First, it is proposed that the standard long-term addition, introduced when the supplementary benefits scheme started in November, 1966, should be increased from 9s. to 10s. a week. This addition is designed to provide a margin to meet special expenses commonly found in long-term cases and is payable to those over pension age and to others, excluding the unemployed, of course, who have received benefit for at least two years. I might add that 80 per cent. of those on supplementary benefit receive the long-term addition. For them, the basic rates for a single householder and a married couple will be £5 1s. and £7 19s. respectively compared with £3 3s. 6d. and £5 4s. 6d. when we came to office. The total rate, including the rent addition, for a non-householder with long-term addition will rise by 5s. to £4 15s.

Secondly, it is proposed that the age band covering children aged 11 to 15 should be replaced by two bands covering children aged 11 to 12 and 13 to 15 years by giving a proportionately higher increase in benefit on this occasion for children aged 13 to 15 years.

This change has been made to take account of the increase in requirements at adolescence and arises both from outside studies which have been made of children's development and of experience gained in the supplementary benefits scheme itself. Perhaps I can put the case for it more simply and directly by saying that the change is being proposed in recognition of the fact that the needs of a child aged 13 to 15 are clearly, and perhaps increasingly as the years go by, different from those of a child of 11.

These new supplementary benefit rates will go to about 2½ million people of whom about 1¾ million will be old people. For most of them the amount of the increase will be straightforward, but there will be some people who, because of the interaction of the proposed regulations with other social security benefits, or with certain specific provisions in the Ministry of Social Security Act, will receive differing amounts. These-people will, of course, be told individually how they will be affected, but it may be for the convenience of the House if I briefly refer to some of the main groups involved.

First, there are families receiving family allowances. When family allowances go up and this increase is not cancelled out by a parallel reduction in the National Insurance dependency benefit, the increases will have to be set against the increased supplementary benefits. As supplementary benefits are designed to bring a claimant's resources up to the appropriate level, family allowances, like National Insurance benefits, have to be taken into account in working out the benefit payable. But, as on this occasion it is proposed that supplementary benefits should be increased at the same time, in almost all cases by more than the amount of the family allowance increase, the effect will be, in general, that the total income of the family will be increased by the full amount of the supplementary benefit increase.

The exception to this will be those families which are wage-stopped, that is, those whose benefit is restricted to the amount which the breadwinner could be expected to earn if he were in work. Where the wage-stop applies, then under the Act supplementary benefit will not be increased, but these families will receive the full benefit of the increased family allowances, because these are payable whether or not the recipient is in work and are therefore ignored in calculating the wage-stop level.

Secondly, there are people receiving more than the ordinary rate under the Supplementary Benefit Commission's exceptional circumstances powers because they have special expenses; for example, for extra food or domestic help which they cannot meet or wholly meet from any long-term addition. As I have explained, the long-term addition is meant to cover special expenses up to 9s., which is to become 10s. as a consequence of the Regulations, but it is in no sense a maximum figure and more can be paid when it is individually warranted. Because these people are already getting more than the long-term addition, they will not in general benefit from the increase in it. What will happen is that the amounts for their special expenses will remain the same on 7th October, but 10s. instead of 9s. will be covered by the long-term additional.

This reflects the fact that for the most part any increase in the cost of special expenses is met as and when it is found to occur without the need to wait for a general increase in benefits. For example, if the cost of domestic assistance goes up, the Supplementary Benefits Commission can help to pay for the extra cost at once. The exception to this is where a fixed sum is laid down for the cost of a special diet, where the Commission, on medical advice, has laid down standard figures for special expenses. The Commission has decided that, on the basis of the proposals in the Regulations, these figures should be increased by 1s., so that for these cases the 1s. increase in the long-term addition will in the ordinary case not be offset by a reduction in any exceptional circumstances addition which is needed.

Finally, there is the claimant who pays an inclusive charge for board and lodging. His requirements are not based on the rates in which changes are now proposed, but, under the Ministry of Social Security Act, are determined by the Supplementary Benefits Commission. Currently, his requirements are taken as the amount he pays for his board and lodging plus £1 7s. 6d. for personal expenses. The Commission has decided that this allowance for personal expenses should be increased in line with the other changes by 2s. for a single person to £1 9s. 6d. and by 4s. for a married couple to £2 10s.

The proposals which I have outlined would increase the cost of supplementary benefits in a full year by about £44 million on existing cases. This compares with the estimated net cost of supplementary benefit in the present financial year of £394 million. The draft Regulations affect the lives of about 2½ million families. The task of putting into effect the higher scales of requirements by 7th October will fall on the staff working on supplementary benefits in the Ministry and it is, of course, because of the size of this task that we are asking the House this morning to approve the draft Regulations at this time, so that the increases proposed can be brought into operation well before the winter. I therefore confidently ask the House to agree to the Motion.

11.18 a.m.

Mr. Marcus Worsley (Chelsea)

The Joint Parliamentary Secretary has treated the House to a very clear exposition of these draft Regulations and we are grateful for them. He mentioned the figure of £44 million and qualified it by saying that it was based on existing cases. I appreciate his difficulty about giving the cost, but the House would be interested to know the sort of estimate which the Ministry has made of the actual cost, because we are dealing with a lot of public money. Obviously, an increase in supplementary benefit scales of this sort brings more people within the scope and therefore expenditure will be rather higher than the £44 million, and I shall be interested to know, perhaps based on precedent, what sort of figure the Government have in mind.

These Regulations are necessary—and we will support them—because of the sharply falling value of the £ under a Socialist Government. As always in these recent years, and even more in this year, Socialism and inflation go hand in hand. As always, the people have to pay for Socialism.

Mr. Speaker

Order. The hon. Gentleman must not widen the debate, or the points he is making will have to be answered.

Mr. Worsley

With great respect, Mr. Speaker, the Parliamentary Secretary advocated these Regulations on the ground that they were fulfilling a Government pledge to protect the weakest in society. But I accept your Ruling and will not pursue this. The point is clearly enough taken.

I want to discuss the actual rise proposed. Supplementary benefit was last raised on 31st October last. At this stage we cannot judge accurately the extent to which prices will rise before next October. Even now there is a whole quarter to go, and heaven knows what may happen under this Government. The last cost-of-living index figure that we have to work on was for May. I am told that not until the end of next week will we get the June figure. To use a former Prime Minister's words, we are working somewhat on last year's Bradshaw.

Let us look at the figures and consider whether these Regulations represent an improvement or merely show the Government running to stay in the same place. On the main figure, the Index of Retail Prices had risen 4.3 per cent. since last October. This present increase is 6 per cent., and the likelihood is that by October that figure will have been reached comfortably, and that by the end of this year the value of supplementary benefits will once more be less in real terms than was its value in October last.

The Government have prophesied a 5 per cent. rise in prices this year, of which 3 per cent. will be due to devaluation and 2 per cent. to the Budget and rises in costs of nationalised industries. In other words, there will be a 5 per cent. rise in prices due to things under Government control, or as a result of Government action. We can be absolutely confident that, whatever the rise turns out to be by the time these Regulations come into force, it will be at least 6 per cent., probably more. The right hon. Lady will know that the figure of 7 per cent. has been widely canvassed as the likely rise in prices during the current year.

Much of this rise has been the result of deliberate Government policy, from S.E.T. onwards. By these Regulations the Government are just, but only just, putting the record straight for those on supplementary benefit. For all those on National Insurance benefits, industrial injury benefits, war pensions, service and occupational pensions—all those on small fixed incomes—there will be no help at all, unless perchance they are brought within the supplementary benefits scale. This is the gravamen of the charge against the Government—that rising prices have corroded benefits, corroded the value of savings and hence the living standards of those living on fixed incomes. These Regulations are an appalling confession of the Government's failure to maintain any control on prices. So much for the boast of the Prime Minister, that the £ in one's pocket would not be devalued.

The figures that I have quoted are from the ordinary cost-of-living index, which has been accepted as the criterion for all these matters. The Minister will be aware that on Wednesday her right hon. Friend the Secretary of State for Employment and Productivity received a Report from the Cost of Living Advisory Committee, which, the House would agree, is of the highest importance. I am aware that the right hon. Lady is not Ministerially responsible for this Report, or directly responsible for its implementation. She will appreciate its extreme importance for her Department, and I hope that without trespassing, she will be able to make some comments upon it. This is the first time that the House has had a chance to debate the Report's conclusions.

The Report advocates a separate index for pensioners. Pensioners form the overwhelming majority of those on supplementary benefit. In advocating this, it is shown that prices which affect pensioners have risen since 1962 considerably faster than the index as a whole. Taking January, 1962, as 100 per cent., the ordinary index in January of this year was 121.9 per cent. The pensioners' household index is assessed in this Report at 126 per cent. The reason was that various items within the budget of the pensioners were quite different from those of the ordinary average householder.

If housing was excluded from the index, then the ordinary index was 120 per cent. and the pensioners' 122 per cent. In other words, on the most favourable showing, the difference was 2 per cent. and on the least favourable, 4 per cent. I think that we must take housing into account in considering these matters. The position is worse for pensioners than the usually accepted figures show, and this is very important. I understand that the Secretary of State for Employment and Productivity has accepted the need for this new index. I hope that the right hon. Lady will be able to say when it will be introduced, and above all, whether she intends to make use of it in the calculations made by her own Department.

These benefits have to be based on a careful assessment of need in the households to which the payments are to be made. Average figures were bandied around, but they can hide a lot of hardship. I am reminded of an old chestnut of a story, about the lift attendant in the United States who, asked by a visiting Englishman what was the average tip, replied "half a dollar". The Englishman gave him the half dollar, and the comment of the liftman was "Man, that is the first time that I have ever been given the average tip."

I would like to know on what firm evidence these figures are based. If the index of retail prices is shown to be misleading in the effect of changing prices upon pensioners, which assumptions are correct? Is the relationship between married and single rates still correct? This has been sacrosanct since Beveridge. Has there been a careful study of need in all the circumstances, as commodities have obviously risen enormously in price? I have wearied the House before on this matter. It seems that the difference in need between a single household and a household with two people cannot be as wide as the gap between these two figures suggests. My own experience suggests that one probably has more hardship in single households, for many matters are so critically important. Paragraph 47 of the Report shows how true this is. As an example, one needs no less fuel, perhaps marginally more, in a single household.

These items play a bigger part in the pensioner household than in households as a whole. I wish to be assured that careful consideration has been given to the relationship between these two figures. I should like to be proved wrong, but my feeling is that I am not.

Are there no regional variations in need between the pensioner in Aberdeen and the pensioner in Torquay, or between pensioners in London and in a country village? The Report advocates a feasibility study to see whether another index to measure this aspect could be created. Do the Government accept this? Will it be pressed ahead and will it be taken into account when the scales which we are debating are considered? Do the present rates make sense for the different categories of people who draw supplementary benefit?

In spite of some changes over the years, particularly the 9s., now the 10s., supplement to which the hon. Gentleman referred, and the changes for older children in the Regulations, which we welcome—they are a step forward—it is still basically true that this is a flat-rate system. Yet the supplementary pension for a retired person is different from the supplementary allowance for, say, an able-bodied man who is out of work. Need they be so closely linked?

Taking the period since 1948, under all Governments, National Assistance, now supplementary benefit, has risen more sharply than prices and earnings. In round terms, average earnings trebled up to January this year. Assistance or supplementary benefit rates have risen by about 3½ times. I have indicated how much can be hidden in an average figure. My impression is that the rates of pay for the lowest wage earner have risen less relatively than the rates of pay for the higher wage earner. The result is that more and more people find that it pays them better to draw supplementary benefit than to do a job.

That is reflected in growing public irritation, often anger, at abuse of this fact by some people. I do not believe that the numbers concerned are very large, but a few cases can cause a lot of concern and can be very discouraging to the thrifty majority. They can throw the whole system into disrepute. The great majority would prefer to work; of that I have no doubt. Certainly, the great majority of wives want their husbands out of the house; of that I have no doubt, either. But it puts a strain on integrity when a low-wage earner with a large family can get much more if he does not work.

Mr. Pentland

The hon. Gentleman refers to the abuse of supplementary benefits. Has he not just quoted what my right hon. Friend the Minister has already said?

Mr. Worsley

Not consciously. I realise that the right hon. Lady, at by-elections, made remarks on those lines, and I hope very much that she will have something more to say to the House today and that it was not just a question of by-election blues. If her eloquence and mine march side by side in this matter, that is to my pleasure rather than my disadvantage.

The improvements in the wage-stop rules, particularly the rule which reduces its operation from six to three months and the rule which introduces, as it were, a national labourer's wage—

Mr. Speaker

Order. We are debating increases in supplementary benefits.

Mr. Worsley

I am grateful, Mr. Speaker.

The improvements to which I have just referred are not dealt with in the Regulations. On the other hand, it seemed to me that they were relevant to the consideration—

Mr. Speaker

Order. We are not debating social security in general and all its problems. We are increasing certain supplementary benefits. That is what we must talk about.

Mr. Worsley

Thank you, Mr. Speaker. I accept your Ruling that to go further into this matter would involve discussion of family allowances, a minimum wage, the rules for unemployment benefit, and so on.

I realise that we cannot pursue that matter in detail. Nevertheless, it would be misleading the House and the country if we did not refer to the concern which there is in the public mind on this subject. Unless the whole system is to be discredited, the public must be reassured that this change of ratio and this increase in the number of people who can be better off by not working, there will be increasing contempt and worry about certain aspects of the social services which would be thoroughly undesirable. I hope that the Government review will include this matter.

I conclude with a general question to the Government. The Regulations increase supplemenetary benefit, but within the framework of what has been done in the past. Can the Minister tell us what are the Government's intentions about supplementary benefits? In 1964, the Prime Minister promised a minimum income guarantee scheme and said that it would be introduced without delay. Have the Government dropped the idea? The right hon. Lady will agree that the renaming of National Assistance as supplementary benefit, which was all that happened, although, I admit, it had greater success than I imagined it would in inducing more people to take it, it did not turn it into an income guarantee system of the sort which the Labour Party proposed when it came to power.

Do the Government envisage the present system continuing indefinitely? Does the Minister envisage that when changes are made in the National Insurance scheme a system equivalent to or the same as this will continue? In considering the rises which are proposed, it is clearly important for us to know whether this is one of a series of rises and the system is likely to continue in the same way, or whether when the great review comes at last before the public's gaze, four or more years after it was announced as a matter of urgency, this type of supplementary benefit is to be ended?

11.39 a.m.

Mr. George Wallace (Norwich, North)

I, too, welcome the increases, although I have a rather uneasy feeling that they will prove to be insufficient. I do not intend to imitate the general political knocking in the middle of the speech of the hon. Member for Chelsea (Mr. Worsley), but it is to the Government's undying credit that sweeping changes have taken place in social security. A great degree of humanity is being shown today that did not exist not so many years ago. Since 1964, there has been a tremendous social revolution. Many thousands are now being taken care of that previously were in dire need and nobody except the few charitable persons even knew or cared. The more fortunate are taking care of the less fortunate, and this is as it should be. It is pure Socialism as we on this side of the House understand it.

I am concerned about the tendency in all sections of society to denigrate the great changes taking place in social security by applying generalised descriptions to those who receive benefits, such as "spongers", "layabouts", and "work-shy". On both sides of the House we have said from time to time that we expect the Ministry's officials to act with great care, humanity, understanding, discretion and tact. There is not the slightest doubt that they do so. In my constituency and in all others the officials are doing their best to be human and to deal with people with great care, particularly old people. I pay my tribute to them.

But it is true that human nature being what it is and always will be there must be some offenders. Action is being taken, and must be taken. But the House must remember that even when we deal with these people they must live. Let us not exaggerate the position. They are an extremely small minority.

There is a great danger of the whole scheme being undermined by foolish exaggeration. Statements like those made in the Daily Mail on 10th July serve only to cloud the public mind and increase suspicion. Such statements, many of them without proof, are frequently made by all sections of the community. Constituents of mine, working people, have talked to me about those on what they still call National Assistance as though they were a separate section of the community being fed and nurtured by the average working man. People in other sections of the community, who can easily look after themselves, often tend to tell others how hard they should be working, when they themselves are living comfortably without doing much work. These statements are made, and the implications need to be refuted.

In answer to a Question of mine on 5th July, my hon. Friend the Joint Parliamentary Secretary told me who are the people that receive supplementary benefits in the area covered by the Norwich office of the Ministry. We want to know and the public should know who are the people that benefit. In May, 1968, in that area there were 10,100 retired pensioners, 250 widows over 60 and 1,200 other persons over pension age. That is 11,550 out of the 15,300 receiving supplementary benefits. The others were the sick, disabled, and so on, including 1,100 unemployed. The number of people who can be described as taking advantage of the scheme and bleeding the taxpayer white is tiny. That list printed in HANSARD is an indication of the wide scale over which the scheme operates, giving dignity to a great number of people.

Complaints have been made. There was one in my local newspaper by a constituent who complained of the people being taxed, retaxed and taxed again so as to give recipients of supplementary benefits an easy living. It is the responsibility of us all to see that these people, particularly the old-age pensioners, do get an easy living. One should reply to such charges with the simple quotation that we should bear one another's burdens, and, indeed, do so.

Provided that the nation realises its responsibilities, and the facts are given of the benefits of the scheme and the people covered, there is no danger of society's being undermined. I think that the great majority of people accept their responsibilities. The statement in the Daily Mail that living off the state is a national disease is a gross distortion of the great social changes that have taken place, and a reflection on the people now benefiting, particularly the old-age pensioners, honest, decent people who have served their country and who deserve all the assistance we can give.

11.46 a.m.

Mr. Tim Fortescue (Liverpool, Garston)

While I agree with every word my hon. Friend the Member for Chelsea (Mr. Worsley) said, I had intended to keep right away from political matters and make an entirely non-political speech. But I must chide gently the hon. Member for Norwich, North (Mr. Wallace).

Mr. Speaker

Order. It will help the reporters if the hon. Gentleman will speak up.

Mr. Fortescue

I must childe gently the hon. Member for Norwich, North for claiming as the unique prerogative of Socialism the system whereby the more fortunate look after the less fortunate.

In this country one can trace that attitude back at least to Queen Elizabeth I, with the Poor Law. In more recent times, during the famous 13 years of Conservatism, there was a good deal of the more fortunate looking after the less fortunate. It is not simply Socialism that has done this, and the Socialist Party should not take it to itself uniquely.

To some of us, if not all, there is something distasteful, almost abhorrent, in a group of well-paid, comfortably-off people having to calculate whether the least fortunate in the land should have another 1s. 6d. a week. There is no alternative and I do not in the slightest degree wish to denigrate the efforts of dedicated civil servants who have to do it. I myself should not like to have to try to work out whether the poorest need another 1s. 6d. to bring them up to a just tolerable level of income and comfort. It must be a task for heroes, and I bow to those who must do it, including the Ministers and Members.

I should like to think of other ways in which the people who draw supplementary benefit can be helped, quite apart from the financial way which we are discussing. I think that my remarks will be strictly in order. The Minister may know, and if she does not I am delighted to tell her, that in the City of Liverpool a way has been found to give such assistance.

In the huge housing estate of Speke, in my constituency, and in other housing estates in Liverpool, the city's Welfare Department has set aside houses and flats where what are known as problem families are looked after for up to six months. This was a brave thing to do, because there is a great housing shortage in Liverpool. In most cases the families are looked after by a devoted woman, a house mother, as it were, who teaches them how best to spend the money they have. She teaches them household budgeting, how to keep the place clean, how to feed the children, and how best to live on the very exiguous income that the family has either by the breadwinner's own efforts or through benefits.

After a few months the family is sent out into the world again; another is taken into the same premises, and the whole process starts again. It is a most valuable side of our welfare services which should be encouraged in every possible way.

Can the right hon. Lady see any way of encouraging such care for the poor, so that a part of the huge sums of money which we are now spending on supplementary benefits—£394 million at present rates, as we have heard this morning— could perhaps be diverted to teaching people how to spend their own incomes better, rather than giving them additional money and letting them get on with it?

Mr. Speaker

We cannot now talk about diverting the sum of £394 million. We are talking about a £40 million increase in supplementary benefits. The rest of what the hon. Member said was in order.

Mr. Fortescue

I had concluded my remarks, Mr. Speaker.

11.50 a.m.

Mr. Kenneth Baker (Acton)

When I first read the details of these Regulations in HANSARD on 17th June I had the impression first of all that there was going to be a real improvement in the actual level of benefits, but having done my sums subsequently I found that these increases we are discussing this morning are not collectively an act of progress but an act of restoration, for they are restoring to supplementary benefits the level of purchasing power which the supplementary benefits had in October of last year. That is the purpose of these Regulations.

The reason why my hon. Friend the Member for Chelsea (Mr. Worsley) touched upon the matter of the cost of living is that it is fundamental to what we are discussing, because the cost of living, as everybody well knows—I am not making a party point now at all— has gone up substantially this year. The Retail Prices Index has gone up 4.3 per cent. between last October and May. What is more important is the increase in food prices, and this is the more important because recipients of supplementary benefits spend a very high proportion of their supplementary benefits on food. The increase in food prices since October, 1967, has been about 5.6 per cent. Later this year, the Government have predicted, prices will go up by at least another 1½ per cent. to 2 per cent. This is one of the very few economic predictions they are prepared to make with any degree of certainty. So the increases we are talking about this morning barely take those increases into account.

The increase for the single householder is 5.8 per cent. and that for a married couple 5.6 per cent. So these Regulations are a very expensive way of marking time—a very expensive way, £44 million we are to approve this morning, and yet, as a result, nobody who draws these benefits will be any better off in real and absolute terms than he was in October, 1967.

The declaration which the Prime Minister gave in November last year on devaluation, and again on 16th January, 1968, is an undertaking we would all welcome, that of protecting the poorest people in our society. But how shabby and inadequate that declaration is. We should commit ourselves, as indeed both parties, as indeed all politicians, in this country do, to definite improvement in the position of the poorest people of this country, and it is most regrettable that, after this enormous expenditure of £44 million, the position of the very poorest people is not going to be any better than it was in October, 1967.

Mr. David Winnick (Croydon, South)

What about October, 1964?

Mr. Baker

The other point I am coming on to is that there are some people who are going to be very much worse off who are not covered by these supplementary benefits. I have in mind—

Mr. Speaker

Order. It is those who are not covered by the supplementary benefits of whom we cannot talk today.

Mr. Baker

I take your point, Mr. Speaker. I am trying to elaborate the point that there are many people not covered by the Regulations who are some of the most under-privileged and desperately poor people in our community today. Take, for example, the widow who has a pension of £4 10s.—by October, 1967, standards. The purchasing power of her widow's pension today, if she does not receive any supplementary benefit, is £4 5s. 6d. So these people who are on fixed pensions of this sort, war disability pensions—

Mr. Speaker

Order. I am sorry to interrupt the hon. Member, but a debate on Regulations is confined to what is in the Regulations. The hon. Member can argue about those who are getting supplementary benefits, he cannot argue about those who are not getting supplementary benefits. Not in this debate. He must find some other debate.

Mr. Baker

Thank you for your Ruling, Mr. Speaker.

I will move on to the actual details of the Regulations and to where I think there is a considerable inconsistency. The point I was making very simply was that these Regulations are essentially a process of marking time. Nobody will take a step forward as a result of them, and in fact some people will take a step back. Coming to the details of the Regulations, and I am one of the few speakers who has come to the details of the Regulations, I should like to ask the Minister a specific question about those relating to blind persons.

Mr. William Molloy (Ealing, North)

I should not like that remark to go on the record without correction. The first thing which the hon. Member for Chelsea (Mr. Worsley), speaking from the Opposition Front Bench, said was to compliment my hon. Friend on his exposition of the Regulations.

Mr. Baker

I thank the hon. Member for his intervention and I thank the Joint Parliamentary Secretary for reading out the Regulations very carefully and not missing a comma.

The question I should like particularly to ask the Minister is about the supplementary benefit increases for blind persons. The increase for a single person who is not blind is 5s. a week, or, percentage-wise, 5.8 per cent.; for a married couple who are not blind, it is 8s. a week or 5.6 per cent. Coming to the blind persons we find that for these people, who, of course, suffer a high degree of disability, the increase, for a couple living together of whom one is blind, is only 4.9 per cent., namely, 8s., and for a couple living together who are both blind, an extreme degree of affliction, the increase is only 4.4 per cent.

I should like to know why there is a difference here, why the rate of increase applicable to those not blind is higher while those who are blind get a lower rate of increase, when the increase for the blind should be not 8s. but 10s. 6d. by the standard which is applied to the non-blind. My hon. Friend the Member for Liverpool, Garston (Mr. Fortescue) referred to heroes who did the calculations. I can only assume that they have not been very heroic in this matter because they have not got their sums wrong, and I can only assume that there must be a reason for this differential increase, and, if there is a reason. I should like to know why the blind do not get a bigger increase instead of a smaller increase.

We are talking about an expenditure of some £44 million, a very large sum of money, and I think it is a cause of deep regret to many people in this House and on both sides of it that as a result of this expenditure many people are not really going to be any better off, and I believe that if this process, of increasing the benefits but not taking into account inflation and purchasing power, is to go on, then obviously they will have our sympathy and that of both sides of the House. This is a very expensive process, because we are having to run very fast and spend a great deal of money to stand still.

There are many groups, particularly the elderly, who are not going to get the right sort of benefit under this scheme. I have in mind particularly the sort of cases I seem to get frequently in my constituency, the case of the elderly widow or spinster, the woman living alone, who probably draws a fixed pension of some sort and can draw supplementary benefit. Both these sorts of people have a particularly raw deal under our social security system, a particularly raw deal, and this, alas, is beginning to be shown in books, such as, for example, that by Professor Townsend, and the Ministry of Health's study of the aged. They are beginning to identify a particular need.

I believe that the £44 million would have been much better spread if it had been spread on selective and identifiable need. I hope that hon. Members opposite will become more committed to this thought, since this is an enormous amount of money from which there will be little real improvement. When we next come to discuss increases in supplementary benefits, I hope that particular attention will be paid to the remarks made by my hon. Friend the Member for Garston that we must identify need, such as chiropody need, home help need, "meals on wheels", and so on, so that increases are made also in care benefits. This is the only way to mitigate poverty and to move towards its abolition.

12.1 p.m.

Mr. William Molloy (Ealing, North)

I rise in the briefest of interventions to say that I believe my right hon. Friend should be congratulated on introducing the Regulations in an effort to maintain what was commenced by the Government, namely, the greatest improvement in our social services that the country has ever known. The hon. Gentleman the Member for Acton (Mr. Kenneth Baker) said that the result is to catch up with the position as it was in 1967. If the Regulations were to try to catch up with the position in 1957, £400 million would not be enough. The probability is that it is not generally understood that my right hon. Friend must take cognisance of the Supplementary Benefits Commission.

I am grateful that this has been done with reasonable speed so that the fallback which has affected those who are in receipt of benefit has now been made good. Many hon. Members would like to see an improvement on this figure for the reason that originally it should have been a larger figure. But this does not detract from the argument that the Regulations maintain a standard which was set by the Government in 1964-65, the like of which we have never before seen. I believe that many hon. Gentlemen opposite are sincere in their study of the problem, and they should agree that the Regulations operate for the benefit of the mass of ordinary people. They ought not to dig up the odd one or two people who exploit the social services. The House cannot legislate on the existence of a minority of cheaters.

It takes me back to the days when many of us lived in grinding poverty, and those were not the days of Queen Elizabeth 1. We had to suffer the humiliation of liars, in the House and elsewhere, who told us that we would keep coal in baths we did not have. This attitude is still extant among sections of the party opposite. I hope, therefore, that my right hon. Friend will not be deterred by the jealous criticisms of hon. Members opposite who are jealous of the fact that they did not do what they ought to have done and jealous of the fact that we have done it. I congratulate my right hon. Friend on introducing the Regulations. I hope, if the need arises, that she will not hesitate to bring further Regulations to the House.

Mr. Speaker

Order. I am in difficulties. I am not blaming the hon. and noble Gentleman, but hon. Members who seek to catch my eye and then change their minds. It is a rather temperamental morning.

12.5 p.m.

Mr. Peter Tapsell (Horncastle)

We all recognise the need which the Regulations are intended to meet; we are glad to see them brought forward and happy to support them.

I have three points I wish to make. My first point is that the mere necessity for the Regulations indicates the alarming rate at which prices are rising as a result of devaluation.

Secondly, the Regulations will help only one-quarter of the retirement pensioners and one-fifth of the widows, while many others in both those categories and other people living on small fixed incomes are suffering increasing hardship from rising prices.

My third point is the most important one. Perhaps I could have the Minister's attention for a moment, because I have a Parliamentary Question down to her on Monday on this point. She referred in her speech at a recent borough election to the growth in the number of lead-swingers who were drawing supplementary benefit to which they were not entitled. During ten years since I first entered the House I have noticed that an increasing number of my constituents complain to me about abuse of the social services and particularly of supplementary benefits. I must admit that when I press them they nearly always refuse to give me specific chapter and verse. The fact remains that the number of criticisms of this kind which reach me—and which I assume reach the right hon. Lady otherwise she would not have made the remark she did—is growing.

Since I believe that the existence of supplementary benefits and the concept of them as being an inherent part of our social services and a form of benefit to which people are just as entitled as they are to any other, it has been a healthy development. The stigma which used to be attached to it, and which still is by older people, is less felt by younger people. That is desirable. We all want to see our affairs run in a humane and Christian way. Where there is real need the Supplementary Benefits Commission has a vital part to play and we all support it in doing so.

As my hon. Friend said in his opening remarks, the success of the policy depends upon continued public confidence in it. If there has been a growth in the extent of abuse, and if there are people who draw supplementary benefit to which they are not entitled, I hope that we shall hear from the right hon. Lady what steps she intends to take to try to stop this.

12.9 p.m.

Mr. David Winnick (Croydon, South)

I believe that there are very few people who abuse the social security system, and those few are people whom I would describe as having personality difficulties. If, for example, the two hon. Gentlemen opposite were to see the people who abuse our social security system they would find no one from their old school because old Etonians who do not wish to work, and there may be one or two, can do so without going on supplementary benefit.

Mr. Speaker

Old Etonians are not dealt with under the Regulations.

The Minister of Social Security (Mrs. Judith Hart)

Would I be in order, Mr. Speaker, in telling my hon. Friend that in fact some, a very few, of the people who are abusing the scheme are from public schools.

Mr. Winnick

The supplementary benefits scheme as it applies to retired people is a great advance on what has existed before. The supplementary scheme as it applies to retired people who have to live on State pensions is a right, it is not a charity. The failure of the old system was that so many retired people refused to draw National Assistance when they were entitled to it for the reason that they looked upon it as a charity. To a large extent, I believe that the Ministry has been far more successful in convincing a great many retired people that they can get supplementary benefit as of right, and that is a considerable advance on the old system.

The hon. Member for Chelsea (Mr. Worsley) asked how long the supplementary benefits scheme will remain in existence. I do not know what the Minister will say in reply but, as I understand the position, the supplementary benefits scheme will remain in existence for a long time to come, simply because there is no other alternative. Unless the existing old age pension is increased substantially, it is only right and proper that we have a supplementary scheme to ensure that people receiving the old age pension can, if necessary, claim a little more to give them a decent standard of life.

I have been told that the value of the old age pension now is 20 per cent. higher than it was before we came to office. That is a tremendous achievement—

Mr. Speaker

Order. On these Regulations, we cannot discuss the old age pension. The hon. Gentleman knows that they are about supplementary benefits, which are being increased under them, so he must talk about supplementary benefits.

Mr. Winnick

I am grateful, Mr. Speaker.

It is necessary to have supplementary benefits, but it is also necessary to increase them from time to time. Although I am pleased with what is being done, I am sure that my right hon. Friend would be the first to agree that there are still many retired people who have a job to make ends meet, and no one can be complacent about their difficulties.

Can the Minister look at the position of retired people who are council tenants and who normally receive a rent rebate? If they receive supplementary benefits, that rebate is taken away by the council. I have been informed about a number of council tenants in receipt of supplementary benefit who no longer receive rent rebates from the local authority and seem to be in a worse position than before. It is perfectly true that the amount of rent is paid by the Ministry of Social Security, but I am told by some of my constituents that they are in a worse position than if they were receiving the rebate. Perhaps my right hon. Friend will look into that problem.

My final point relates to heating arrangements. I believe that my hon. Friend the Parliamentary Secretary said that heating arrangements are allowed, and we know that quite a number of retired people receive such arrangements. But could more be done? It seems that many retired people receiving the old age pension and supplementary benefits still find it difficult in winter months to warm their rooms sufficiently. Suggestions have been put forward for heating arrangements, and I hope that my right hon. Friend will look at them.

12.12 p.m.

Lord Balniel (Hertford)

These Regulations are designed to protect those living on supplementary benefit from the full impact of rising prices which are consequential partially on devaluation and the rising cost of imports, partially upon the normal inflationary process in our society, and partially on the Budget itself

The arguments on behalf of the Opposition has been put forward comprehensively by my hon. Friend the Member for Chelsea (Mr. Worsley). I only want to speak on one or two broad issues. However, shortly before the debate began. I thought that I ought to look at the debate which took place on 24th July, 1967, when the Government last introduced proposals to increase supplementary benefits—on 30th October, 1967. It so happens that the volume of HANSARD fell open at a speech by the Chancellor of the Exchequer on the same day.

In the course of his remarks, he said: Let there be no dodging about this. Those who advocate devaluation are calling for a reduction in the wage levels and the real wage standards of every member of the working class in this country. They are doing this and the economists know it. He went on: I just do not want either to devalue our own word or to bring down the standard of life of our own people. Then some bright spark, an anonymous hon. Member, cried out: Well done Jim!"—[OFFICIAL REPORT, 24th July, 1967; Vol. 751, c. 99–102.] Today, almost a year later and after devaluation has taken place, we find ourselves debating similar Regulations designed to improve the supplementary benefits, or national assistance benefits as they are still widely known in the country—designed to come into effect on 7th October of this year. This time, the proposals have to be debated in the context of a Budget which has been very severe, in the context of a statutory wage freeze, and in the context of pretty sharply rising prices.

The Prime Minister said that it was his purpose and one which was shared by the whole House to protect the most vulnerable sections of the community. The Minister of Social Security has said quite rightly that these Regulations are part of the Government's effort to protect the most vulnerable sections of the community, namely, those living on supplementary benefit, from the full impact of rising prices.

However, this step will cost the taxpayer at least an additional £44 million, and it is right to point out in this debate that the taxpayer's money is being used not to achieve an improvement in the living standards of those living on supplementary benefit but merely to keep pace with the rising cost of living. To adopt the words used by my hon. Friend the Member for Acton (Mr. Kenneth Baker) this additional expenditure of £44 million is merely marking time for those who are in receipt of supplementary benefits.

The cost on the total economy of the country is very substantial. The Parliamentary Secretary said that, according to the last Civil Estimates, the total cost of the supplementary benefits scheme was £394 million. These Regulations increase that burden by a minimum of £44 million. Even with this increase it is probable that, by the end of the year when the increases have been implemented, the purchasing power of the supplementary benefits will be less than it was in October, 1967.

I will not repeat the detailed figures advanced by the Parliamentary Secretary or those given by my hon. Friend the Member for Chelsea. In broad terms, the proposals are to increase the benefit for a single person by 5s. a week and for a married couple by 8s. a week. According to our calculations, they represent an increase of 5.8 per cent.

Unfortunately, I have not had a great deal of time to check the figures required for this debate. Yesterday, I was ploughing my way through the floods in the West Country trying to return to the House. However, I believe I can confirm the figures given by my hon. Friend the Member for Acton that between October of last year, when the rates of benefit were last increased and May of this year, the Index of Retail Prices has risen by 4.3 per cent. Food prices lie at the very heart of the daily budget of families of the lowest income scales, and they have risen by 5.6 per cent between October, 1967, and May of this year.

The Government have told us that during the present calendar year they expect, as a consequence of devaluation and the Budget, that prices will increase by 5 per cent.

Mr. Roy Roebuck (Harrow, East)

I sympathise with the noble Lord on recently emerging from the Flood, but his argument seems rather antediluvian. I do not: understand this part of the hon. Gentleman's argument when he talks about rising prices. Is the hon. Gentleman saying that the proposed increases are not high enough? Are the Opposition advocating higher increases? If that is so, can the hon. Gentleman relate that to his argument about marking time? My recollection of the period when the Conservative Party was in office is that there was not even any marking time. The standard of living of the pensioner went clown and down, and all we got was the insulting observation of the right hon. Member for Kinross and West Perthshire (Sir Alec Douglas-Home).

Mr. Speaker

Order. This is a very long intervention and it is rather too wide.

Lord Balniel

The hon. Member for Harrow, East (Mr. Roebuck) says that my argument is antediluvian. The hon. Gentleman's interruption is premature, because this is one of the points to which I shall be referring in my speech. Not only was the hon. Gentleman's interruption lengthy and premature; it was factually mistaken.

During the post-war period average earnings have risen by about three times and supplementary benefits have risen by about three and a half times. I can assure the hon. Gentleman, if it will satisfy him, that this was one of the arguments to which I was going to refer in my remarks.

I now turn to one or two broad aspects concerning these Regulations. As we so rarely have this opportunity in the House, I think it is right that we should pay a tribute to the excellent work which is done by the officers of the Supplementary Benefits Commission. My hon. Friend the Member for Liverpool, Gars-ton (Mr. Fortescue) said that their task was heroic. Few of us would like to undertake the extremely difficult task they fulfil of assessing whether a person is making a real effort to find employment; whether he has merely temporarily found that life has become too much for him; whether he has some kind of personality weakness, or is just work shy. I think that one must also say that the change in people's attitude to the old National Assistance Board and to the present Supplementary Benefits Commission is due infinitely more to the way in which the officers of the Commission conduct their business, inquiries, interviews and visits than to the legislation which we in this House try to pass.

None the less, when we look at the legislation on this subject which has been passed by this House it is imbued with a humanity of purpose which I find very impressive. There has been a fine impulse in all Governments, of whatever political complexion, to try to raise the living standards of the poorest in the community. In the long trend of postwar efforts to try to help the poorest in our community, the level of supplementary benefits, as I pointed out to the hon. Member for Harrow, East, has risen faster than the rise in earnings and the rise in prices. Although I cannot prove it statistically, I think, as my hon. Friend the Member for Chelsea said, the level of supplementary benefits has in particular risen substantially faster than the rise in the earnings of the lowest wage earners.

The very generosity of purpose of this House has highlighted a problem concerning the lowest wage earners with several children. During a time of statutory wage freeze, combined with rising prices and rising supplementary benefits under these and previous regulations, this problem will be seen to be becoming increasingly acute. Despite the increase in the amount of family allowances, there are about 200,000 or 250,000 children living in families where the bread winner's income is below supplementary benefit levels because of low wages. When the supplementary benefit goes up on 7th October this year the number of families in employment living below the minimum level laid down by Parliament as compatible with a civilised society will increase.

I do not want to ask the right hon. Lady a large number of questions at the end of the debate, but I wonder whether she will find it possible to tell us how many children she expects will be living below supplementary benefit level when the new benefits come into operation in October as against the figure of 200,000 or 250,000 today.

The overall result of this generous impulse to try to help the poorest sections in our community is surely twofold. First, there is the undeniable fact that there are a number of families living below this minimum standard which we regard as acceptable. Secondly, for those who are on the lower and, indeed, the lowest wage levels, there is in financial terms a decreasing incentive to work. If they become unemployed they will get the same amount of money from the Supplementary Benefits Commission. Because of the wage stop of course they cannot get more than they were earning when in employment.

Overwhelmingly—and this is why I resented some of the interjections in the debate—the beneficiaries of the Supplementary Benefits are the chronic sick, the elderly, and the pensioners. But there is increasing resentment by those who are working on low incomes that they do not get as much as some persons who are out of work. Indeed, with my rather large family, especially since the right hon. Member for Sowerby (Mr. Houghton) has spoken, I am almost beginning to feel like a social delinquent because I receive very substantial benefits. But the Government are faced with the really difficult twofold problem of eliminating family poverty and at the same time providing some incentive to work for those at the lowest income levels. The amount of abuse is small as a proportion of the total benefits—but it is real. Incidentally, I think the abuse lies primarily in the sphere of earnings related unemployment benefit and the redundancy payment scheme rather more than in the Supplementary Benefits Commission.

I would be out of order in repeating the argument which I have so frequently advanced for reconstructing the family allowances scheme, but I want to make four brief points. First, I think that there should be a really thorough study of the many and different means tests which are now operating in the country as a whole. I am not suggesting that one form of means test is applicable for all different types of problem, but I have seen it suggested by a most eminent professor in this sphere, Professor Titmus, that about 1,000 means tests are operating at the moment. There seems to be a strong argument for simplification. Indeed it is long overdue. I hope that the right hon. Lady will find it possible to achieve something along these lines.

Perhaps I might ask the Minister in passing whether it will be possible to give any progress report about her so-called entitlement campaign, whereby she was encouraging people to take the fullest advantages of the welfare benefits available to them. The right hon. Lady said in her letter of June that she would that month be sending out more than 14 million leaflets to call people's attention to the benefits to which they were entitled. I think that it would be interesting to hear what progress has been made. It has served one useful purpose for me personally as I have discovered that some of my children are entitled to free school meals.

Secondly I think that there should be a tightening up of the administration of the Supplementary Benefits Commission to ensure that nobody can continuously turn down jobs on the ground that he would not be working in his normal occupation. On the whole I feel that a tightening up of administration is preferable to the kind of suggestion made in the Report of the National Insurance Advisory Committee on Conditions of Unemployment Benefit for Occupational Pensioners, but this is a matter which we shall have to debate in the future.

Thirdly, I believe that the redundancy payments scheme should be thoroughly examined. There is a widespread feeling that there is a small amount of abuse by both employers and employees, and I should have thought that this was something which could perhaps be referred to the Public Accounts Committee for examination.

Mr. Speaker

Order. The hon. Member must come back to the debate.

Lord Balniel

In deference to your Ruling, Mr. Speaker, I shall immediately do so.

Mr. Molloy

On a point of order. Mr. Speaker, your Ruling makes it difficult for some of us, because the hon. Member for Hertford (Lord Balniel) has made a point which I dispute, and if I tried to refute his argument you would naturally rule me out of order.

Mr. Speaker

That is a classic statement of the reason why nobody should get out of order.

Lord Balniel

It only remains for me to apologise if I have strayed and caused you, Sir, any embarrassment.

Fourthly, the Report of the National Advisory Committee on the Wage Stop, in so far as it referred to supplementary benefits;, suggested that there should be a special review of the position of the disabled. Can the right hon. Lady say whether it is possible for her to initiate such a special review to secure for the disabled the fullest benefit of the supplementary payments which are available?

This Order is a reflection of the rising prices in society. At a cost to the taxpayer of £44 million, it will merely ensure that those in receipt of supplementary benefits are kept at the same standard of life as they were in October, 1967, and in so far as it brings help in that respect, of course we support the Order.

Mr. Roebuck

The noble Lord said that he would tell the House whether he thought that the amounts in the Order were adequate, or whether the Opposition thought they ought to be higher. Perhaps he will tell us that now.

Lord Balniel

I thought my last remarks made it clear that we supported the Order. We think that this sum of money is necessary to compensate for the erosion in the purchasing power of the supplementary benefits which were put up only last year.

12.33 p.m.

The Minister of Social Security (Mrs. Judith Hart)

As often happens with a short debate, this has been a good one. We have had a number of short but very much to the point speeches in which the attention of the House has been directed to the relevant points which hon. Members have put forward. I have been asked a number of questions, and perhaps I might deal with one or two of the odd questions which have been asked before I go on to my more general remarks.

The hon. Member for Hertford (Lord Balniel) asked about the review of the position of the disabled in terms of the wage slop. The position is that one by one discussions will go on between my Ministry and the Department of Employment and Productivity because we have to keep in close step on any new measures which are taken concerning the disabled worker. Progress is being made, and I hope that within a matter of two, three, or four months it will have been possible to have reviewed every case of the disabled in terms of the wage-stop. This is obviously bound to take a good deal of time, and must depend on the pressures on a local office, because it means doing individual work for each case.

I have a Question down to me on Monday about the entitlement campaign, and perhaps I should not anticipate what is to be said then.

On means tests, I think that I have on several public occasions drawn attention to the work that was done—probably the noble Lord was referring to the same piece of work—by Michael Reddin, at the London School of Economics. He produced a paper some months ago which has been published as a Fabian Society pamphlet. He investigated the multiplicity of means tests, and the variation between them in terms of various local authority benefits. In drawing attention to the work which has been done, I have been indicating that it seems to me that it would be an extremely good thing if we could work towards something a little more multipurpose, a little more uniform, by way of testing the entitlement of people to all these various benefits, most of which are administered by local authorities and of which obviously they must retain control since it is their money and their schemes, and some of which are administered by Government Departments.

Clearly this is one of the new areas of problems which have recently been identified, and I agree with, the hon. Gentleman that it is useful to draw the attention of the House to the fact that here is a problem which is not incapable of solution, but on which clearly a great deal of complex work will be needed to arrive at a solution.

I turn, now, to some of the more general points which were made, and I propose to deal first with the question of the pensioners' index which was mentioned by the hon. Member for Chelsea (Mr. Worsley). I think that the hon. Gentleman knows—and I cannot today add to what was said—that my right hon. Friend the First Secretary, in accepting the Cost of Living Advisory Committee's Report, said the other day: The Government accept the Committee's recommendations and steps will be taken to implement them as soon as this can be done. The detailed study of the technical problems of compiling reliable price indices for regions is beginning immediately."—[OFFICIAL REPORT, 10th July, 1968; Vol. 768, c. 109.] That answers one of the hon. Gentleman's points about the cost-of-living index for pensioners. As soon as this can be done it will be carried out.

This bears closely on the work of my Department. It bears closely on my need to take full account of the particular problems of pensioners as distinct from those of the population in general. In so far as this is relevant to the debate, I think I should point out that the particular difference which was noted by the Cost-of-Living Advisory Committee between the cost-of-living for the population as a whole and the cost-of-living for pensioners was the bearing which housing costs had in this respect. The important point to note is that the pensioner index minus the element of housing diverged only half as much from the general index as did the pensioners' costs including housing.

The relevance of that to this debate is that where supplementary benefit rates are concerned this index figure minus housing is appropriate because rent and other housing costs are allowed for separately in the assessment of supplementary benefit. Therefore, a pensioner who is on supplementary benefit has account taken of this major element which seems to differentiate a pensioner's index from the index relating to the population as a whole. Therefore, we need not worry that, in terms of supplementary benefit, we are not already taking pretty good account of most of the points which emerged from the survey conducted by the Cost-of-Living Advisory Committee. This is not necessarily the case for those who are not receiving supplementary pensions or benefits.

I turn, now, to the cost of the proposals. I was asked by the hon. Member for Chelsea whether I could give some estimate of the additional costs which would arise as a result of new claims to benefit following the increase in the level of benefit. It is not possible to answer that question. We cannot say exactly how many will be brought within the scope of the scheme as a result of the increases nor the proportion of those who will make a claim. All that one can say is that since the amounts to which they will be entitled will be small, the additional cost as a result of extra claims cannot be expected to be substantial.

I was asked by an hon. Member opposite what cost this represents to the nation. In terms of public expenditure, this uprating in supplementary benefit does not involve an increase in public expenditure as it is measured because of the constant price element which is involved in public expenditure. The supplementary benefit uprating next autumn is being made solely to compensate for rising prices.

Therefore, although in money terms the cost is about £44 million, since all this sum is to enable the rates to keep in line with prices none of it counts as an increase in public expenditure at constant prices. I know that that point is apt to be somewhat confusing to those who are less familiar with the intricacies of the financing of social security.

The relationship with price increases has been one of the main themes of the debate. As my hon. Friend the Joint Parliamentary Secretary said, the main increases which are proposed represent increases of just under 6 per cent., as the noble Lord also said. In saying that, however, one does not convey the full extent of the increase because of the special needs of which account is being taken outside the basic increase in rates. The main factor here is the increase in the long-term addition from 9s. to 10s. In the majority of cases, this will produce an increase of 6s. for the single householder, or about 6.3 per cent. more than the existing rate of benefit, including the long-term addition. For most, therefore, the increase will be 6 per cent. or above.

As to the relationship between the increase and the increase in prices between October of last year and May of this year —the noble Lord was quite right in the figures he quoted—the index of retail prices increased by about 4.6 per cent., not including housing; but housing is taken account of separately in supplementary benefit.

The most recent detailed statement on the kind of price changes that we can expect was made by my right hon. Friend the First Secretary, in May, when she said that during the coming year we face a 3 per cent. increase in prices due to devaluation and a 2 per cent. increase due to the increase in nationalised industry prices and in Budget taxes. Some of those increases have already taken place and we need not necessarily expect the rate of growth in costs to be as high between now and October, when the new rates come into operation, as during the last two or three months.

For example, the increase between the April and May figures in the index of retail prices was only one-tenth of one point, so that the rate of increases in prices is not necessarily an even one, and we have borne a considerable part of the load of the post-devaluation price increases as imports have begun to work their way through into the shops.

We can fairly say that the increase in rates which we are now putting before the House will truly allow the most vulnerable among those who are entitled to supplementary benefit to have their standard of living kept up to the level of October, or soon after October, of last year. As some of my hon. Friends have pointed out, that level—and I know that hon. Members opposite welcome this just as much as we do—represented an increase in the real value of supplementary benefit, as well as other pensions and allowances, including some of those which it would be out of order for me to discuss but which an hon. Member opposite mentioned.

All National Insurance and supplementary benefits rose in real value by 20 per cent. between October, 1964 and October, 1967. We therefore rest on a firm footing of having substantially increased in real terms the standard of living of those whom we now seek to protect.

The hon. Member for Acton (Mr. Kenneth Baker) referred to rates for the blind. There is, of course, a long history of a difference between rates for the blind and those for other beneficiaries. At various points in that long history, sincere attempts have been made to express the compassion of the nation for the particular groups of blind people whom we try to help. One ought, however, to point out that at this stage, in relation to the present increase, there are factors which should be taken into account and set against the fact that there is no special increase in the rates for the blind on this occasion.

The majority of blind people who receive supplementary benefit are over pension age. Together with other long-term recipients, they qualify for the long-term addition of 9s. a week, now to become 10s. That addition is to meet special expenses. The current rate of difference of 24s. 6d. is itself for special expenses arising from blindness. Therefore, the great majority of blind people at present have a substantial margin— now standing at 33s. 6d., and to be increased by the Is. increase in the special long-term addition to 34s. 6d.—above the basic scale to meet their special needs.

The blind have one additional preference. If blind householders have, for example, an adult working son living with them, the rent allowance which is added to their basic needs is not reduced by the non-dependant's share of the rent. This is a special privilege which the blind have.

Mr. Kenneth Baker

I was not arguing for a special extra increase for the blind. I was asking that they should receive the same rate of increase as the non-blind under the Regulations. The non-blind get an increase of about 5.8 per cent., whereas the blind get only about 4.4 per cent. This seems to me to be an unfair anomaly.

Mrs. Hart

In all these matters I take account of the detailed thought that is given by the Supplementary Benefits Commission to the special problems of particular groups. Any decision about making an increase in the rates of supplementary benefit is a matter for me as Minister, but the Supplementary Benefits Commission has full responsibility to advise me on how effect should be given to increases in the rates. The Commission and I have, of course, taken into account the special preferences which I have indicated. As, in the past, there have been a number of occasions on which special attention has been given to the blind, we do not on this occasion propose the kind of increases for the blind that the hon. Member suggests.

The noble Lord asked whether I could estimate how many children were likely still to be living below the level of supplementary benefit when the rates of both supplementary benefit and family allowances are increased in October. The House will note that on this occasion family allowances and supplementary benefits are being increased at exactly the same time. We can, therefore, hope on this occasion to minimise the awkwardnesses which arise when one rate goes up and account of that has to be taken in some other benefit.

I cannot give the noble Lord the figure that he asked for. I have explained in the past why all I could do is to quote the figure as we knew it from the Family Circumstances Survey. I hope that some of the further research that we are planning will enable us to have more up-to-date information, but at the moment I could only quote the figure in that survey, which is now two years old, and say that the factors affecting numbers are so variable that one cannot possibly make an estimate that takes all of them simultaneously into account.

As a man's wage rises, he gets out of the poverty group. On the other hand, if his rent is increased he is pushed down again. There are so many different factors that reliable estimates are not possible. This means that it is always a little dangerous to make assumptions about numbers. So if one cannot reliably estimate it is probably wiser not to make assumptions. I prefer to refer back to the survey and say that I cannot tell hon. Members more than that, but that all these things will have had an effect.

I turn to one of the basic themes that have arisen in the debate—the question of the minority who are abusing social security. I agree with the emphasis which has throughout the debate been placed on the fact that when we talk about abuse of the social security system we are talking about an extremely tiny minority. Indeed, I think that hon. Members on both sides of the House are so much aware of the problem that there is a real understanding of their nature. However, one of the difficulties is that our understanding in the House is not shared sufficiently by people outside. One of our tasks on both sides in protecting the social security system, of which both sides have a right to feel proud, is to extend to people outside the House our own knowledge of the nature of the problem and of the right-ness of what has been done in increasing the standard of living of the poorest in our society. One would particularly wish that the Press, which avidly focuses attention on any single case that it hears about, would a little more responsibly carry out the task of informing people about the nature of the problem.

As I say, this concerns a tiny minority. It is a minority generally to be found more among the 20 to 45-year-olds than among the 45-year-olds and over. It is to be found more among people who have never experienced the kind of hardship that older people knew. It is found among a group of people who, because they have not participated in the fight for better social security conditions so fully, are less inclined to have a pride in them. It is often found, as I said in an intervention to my hon. Friend the Member for Croydon, South (Mr. Win-nick), among middle-class youngsters who ought to know better, youngsters who have public school education, youngsters who sometimes have part or whole university education. This very small element of the problem is confined mainly to London.

Outside London the problem arises largely among the unskilled rather than the skilled. To this extent, I would quarrel a little with what the noble Lord said about the rôle of earnings-related supplements in this, because the people who benefit from such supplements tend to be the more skilled workers. The low earner derives comparatively little benefit from the supplement, and the unskilled man tends to be a low earner. Therefore, I dispute that this is one of the main elements in the problem of the workshy.

Lord Balniel

Would the right hon. Lady explain one thing? With regard to the higher income groups in receipt of earnings related unemployment benefit, can she explain to the House the logic —I am sure that there is a logic in it, but I do not understand it—of taxing a widow's pension or a retirement pension, but not taxing the earnings related unemployment benefit, which can reach very high levels for periods of six months?

Mrs. Hart

The logic is to be found in the general context of the splendid logic of our whole taxation system. But it is the unskilled worker who is mainly finding a disincentive to work as a result of the increase in the levels of supplementary benefits which are paid. This raises two questions. It raises a question to which my answer, and I think the answer of the whole House, is clear. Have we been right to raise out of poverty many people who up to three or four years ago were living in poverty? Have we been right to improve the standard that we regard as being the minimum for a family where a man is sick or where a man and his wife are old? Have we been wrong to seek to increase that standard of living?

Mr. Molloy

I should like to make a point before my right hon. Friend leaves the subject that she is now talking about. There is this range of people—they are a tiny minority—who are cheats. But this defect in personal make-up is at the other end of the scale, as well. I remind her that one of her colleagues had to introduce legislation to deal with those who cheat with their Income Tax returns. It was no mean figure. It was so large that it would have paid for what we are discussing under these Regulations.

Mrs. Hart

My hon. Friend is quite right. But one of the suggestions that seems to emerge from many of the Press discussions of the problem is that we may have been wrong in raising the minimum levels that the State is prepared to guarantee to those who are old, sick or unemployed through no fault of their own and the vast majority of those who rely upon the State in adversity for the protection of their standard of living. I am sure that the whole House would totally reject the concept that it is anything but completely right to seek to do this and that as the standard of living of the rest of us advances we should seek to carry with us the standard of living of those who need our protection.

I think that in nearly every debate that we have had about social security, whether about family allowances or supplementary benefits, I have emphasised that the real trouble goes back in the end to the fact that there are still some people, a small group, who earn lower wages than the level of supplementary benefit that is paid. This is our problem of child poverty. It means that one must identify the groups in poverty —the disabled, the partly disabled, the man who cannot hold down a steady job at a high enough wage because of a chronic ulcer or a weak heart, the genuinely socially maladjusted, the people with some real mental or psychiatric difficulty which means that we have to extend to them sympathy, help and consideration.

We have to look at the incomes policy. In its income policy, the Government have made it clear that we have to give special consideration to the needs of lower-paid workers. Every time a wage agreement is negotiated between a trade union and an employer which gives a marginally extra increase, a higher proportionate increase, to the lowest paid than to the better paid, to that extent a real contribution is being made to solving the problem of poverty and the problem of abuse.

Of course, it is correct that the field in which we can try to check this tiny minority of abuse is in administration, and I want to make a very important point here. The hon. Member for Hertford paid tribute to the work of the staff of the Ministry. He is right in saying how crucial, in persuading people to take advantage of the supplementary benefits and other benefits available to them, has been the rôle of the staff in terms of their ability to create a good and sympathetic relationship with those who come to them for help.

I am sure that the hon. Gentleman also knows what a tremendous task the staff of the Ministry has carried out over the last two or three years in introducing the new measures which have enabled the Government to assist those in our society who need our help. Of course, if one is to track down and do something about the odd case where it is thought that someone is committing abuse, this demands the individual attention of an individual member of my staff because that is what using administrative methods means.

I hope soon to indicate one or two respects in which the administrative measures we use may be slightly changed in order to allow my staff to be able to deal more effectively with the cases they know about and have identified, but in terms of the numbers they represent it is a very delicate balance that we have to achieve here. The House is aware of it and I wish that the country were as much aware of it.

One single case of abuse in a whole housing scheme can be known to everybody in that scheme, talked over many times, go round in circles and come back with changes in the story. One knows that in people's minds there is doubt about our whole system. This is why the Ministry tries extremely hard to get to grips with those it can identify as abusing it. But it is equally true that, when a man is seen walking down the street having just claimed supplementary benefit, and looking fit and healthy, someone says, "There is a man who should be at work." They may not know his medical history, that perhaps he has only recently ended treatment in a psychiatric hospital. They cannot make judgments merely by what they see.

One of the outstanding qualities of the staff—and it is one which never ceases to amaze me—is the way in which they are able unerringly to distinguish between the man to whom sympathy and help and understanding should be extended and the one who is trying to get away with something. But it is important to emphasise that many who seem to be workshy may merit our sympathy instead. I refer now to the Daily Mail article earlier this week because it represents an interesting example of the perfectly genuine misunderstandings which can sometimes arise.

The article was, to begin with, as far as I can gather, a collection of cases which were mainly drawn from previous Press reports. They were not cases suddenly discovered. They were old Press cuttings dug out of the file. We have been able to track down the origin of a few of them. For example, there is the case of Mr. X, as the article referred to him. The article said of him: Consultant Mr. X sold his £10,000 house and moved into a luxury flat. He organises management advice for fees. His wife has her part-time job. Mr. X also draws Social Security supplementary benefits. In other words, he is on National Assistance. I may point out, in passing, that, of course, Mr. X is not on National Assistance. He is receiving supplementary benefit.

My officers who have seen him say that he is a very sick man, suffering from coronary thrombosis, that his business showed no trading activity for the year to which the report refers and that it was totally stagnant mainly because of his health and partly because the business had not been doing very well. The house was certainly sold for £10,000, but the proceeds were used to clear the outstanding mortgage and to buy his present smaller flat, on which the outgoings are not allowed in full in the payments he gets from supplementary benefit. This presents a rather different pattern.

In case No. 1 in the Daily Mail article, the facts are that he has been receiving supplementary benefit only since January this year. He retired in 1961 and from then until January, 1968 was living on his savings. He has now exhausted most of his savings and is on supplementary benefit. That, again, is a somewhat different picture from that presented by the Daily Mail. There are others. Case No. 4 is the one where, according to the Daily Mail, a former cinema worker, unemployed for eight years, draws more than £14 a week from the State. The article said: When it was suggested he should turn in his rented TV to help pay his debts, he said: 'I can't do that the doctor said I should have TV to relax my mind'. Supplementary benefit is not now in payment to this man, despite what the article implies, because, since the report was published, he has died. The article did not bring out the fact that he was unable to work because he was very sick and that sickness benefit was in payment. The suggestion about the T.V. set was made by a judge when the man was brought before the court for non-payment of a debt. These are different pictures from those presented by the Daily Mail.

Case No. 5 was that of a Greek born man who drew £8 a week for five years. The article said: He said he was paying 50s. a week rent, had no assets or income and was in dire need. In fact he owned two houses and a restaurant —and was guarantor for a £4,000 bank loan to his daughter. He was jailed for three years. This, of course, was an elaborate and deliberate fraud. The man represented that he had no source of income. But the point is that the fraud was detected, the man was convicted and he went to prison for three years.

Indeed, during the last three years, as a result of deliberate efforts the Ministry takes to prosecute fraud cases, 451 men were prosecuted for remaining deliberately without a job when they could have got one. We have about 60 officers throughout the country who specialise in dealing with this kind of abuse. I believe that a very effective job in many areas is already being done.

I have tried to get the balance right. It is a difficult one to achieve. I am worried about the tiny minority who are cheaters. I am equally concerned that the public should know that there are many whom they think to be cheaters who deserve their sympathy instead. It is important that this very delicate balance should be kept in the task of looking after those who merit our sympathy and in chasing up the cheaters who do not merit it. On the latter point, I believe that it is important that the Ministry should, through administrative action, take all steps it can to further the effectiveness of the measures which already exist. That is the right balance. Having emphasised the need to get the balance right, I am prepared to believe that many Press reports which appear will not get the balance right.

We all find it extremely difficult to discuss this issue in terms which are clearly understandable and simple to the general public. I come back to the essential basic problem of low wages. To the extent that we can end the low wage problem, we end the temptation and incentive to cheat in social security. But in asking the House to approve these Regulations, I am grateful for the highly intelligent and informed comment throughout the debate. Somewhat academic as we may have been, we have been talking about the extent to which we can extend compassion to those in our society who demand it of us.

We are talking about old people in front of their firesides this winter; we are talking about people who are trying to bring up families when the husband is a chronically sick man; we are talking about wives who have been deserted; we are talking about unmarried mothers; we are talking about all those groups who, through no fault of their own, are in adversity and whom the House has always sought to help and whom again it is seeking to help today.

Question put and agreed to.

Resolved, That the Supplementary Benefit (Determination of Requirements) Regulations 1968, a draft of which was laid before this House on 18th June, be approved.