HC Deb 23 May 1968 vol 765 cc1072-82

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Ernest G. Perry.]

1.55 a.m.

Mr. Julian Ridsdale (Harwich)

Those whose constituencies contain a large proportion of over-60s, as is the case in North-East Essex, know how much devaluation has been the hallmark of failure of this Labour Government as it was for the previous one and that no section of the community has been more hurt than the over-60's. But the elderly realise that, if they are to be provided with a reasonable life now and in the years to come, we must get economic growth and create more wealth.

Labour policy has been to urge heavier taxation to raise money for the welfare of the elderly, but we know from bitter experience that this is self-defeating. We can pay more benefits and higher pensions only if we create more wealth. It was precisely because the last Conservative Government achieved growth over 13 years that it was possible to increase pensions and other benefits five times, so that they rose a good deal faster than prices, and make big reductions in taxation. In North-East Essex, in particular, we see the fabric which we created being severely strained.

Meanwhile, because of the failure of the Government's financial policies, all we can do is select priorities and work on the principle that help should go to those who need it most. With the experience of having to deal with the social welfare of many in North-East Essex for some time now, I put my first priority as pensions for the over-80s, who were already over pensionable age when the present pensions scheme began in 1948. The Government say that no pensions can be given because these old people have not paid contributions, but the cost of pension has always been met from taxation and these old people have been paying taxes for well over 60 years. Surely, in fairness and humanity, they should be able to get—

Mr. Speaker

Order. I am not unsympathetic to the problem which the hon. Gentleman is raising, but can it be solved without legislation?

Mr. Ridsdale

I hope that it will be in order to discuss this matter, Mr. Speaker.

However the Under-Secretary may use his statistics, in terms of purchasing power and prospects, the elderly are worse off now than for many a year. Imagine increasing the retirement pension in October, 1967. and then devaluing it in November. Pensioners see their hopes shattered every day by rising prices. An example is the increase in telephone charges. Is it beyond the wit of the Postmaster-General to provide a cheap call service in case of need, particularly for the elderly living on their own and in the countryside?

Another price increase which has particularly hit the over-60s is the increase in the television licence, not to mention the feeling they have because of coke, gas and electricity price increases, plus increases in bus fares and the 4,589 grocery price increases there have been in the 24 weeks since devaluation. Now, after three years of Labour Government, many of the elderly are just living from day to day. There are many who are just glad they can keep where they were the day before.

One of the tragedies of the Government's mismanagement of the economy is' that there is now to be a cut-back in the local health and welfare services which care for the elderly and the handicapped in their own homes. It is these services which often make it possible for old or handicapped persons to stay in their own homes, where they are happier, instead of going to hospital at far greater cost to public funds.

But as part of the Government's latest cuts, the planned growth in capital spending on these services is being cut by £5 million a year—1968–69 to 1970–71. Local councils have been told that they must bear the entire burden of rising costs following from devaluation; they are getting no help from the Government. This is why more elderly people have had to pay more for daily helps, or go without them. Further money is not coming forward as fast as it should to meet the need for more hospital accommodation. All these problems I think we in North-East Essex share with other over-60s all over the country because of the failure of the Government's financial policies.

But I particularly want to deal with four problems facing the elderly in North-East Essex. The first is the employment of the elderly in seaside and resort areas and the effect of S.E.T.. and the latest increase in the rates, has had on their employment. Then there is the growing burden of educational charges being borne by the rates, and the savage rise in rates due to planned increases in population, and the little help that has already been given to areas like North-East Essex which has absorbed in the last 10 years an increase in population of over 20,000, the equivalent of a new town.

Finaliy, there is the unfairness that 25 per cent. of rate relief should be borne by the ratepayers, many of whom are retired and can hardly afford to pay such increases. Is it really fair that hotels and restaurants in development areas should be relieved from paying S.E.T. whilst some coastal resorts where unemployment is much higher, should get no relief? On average, in February and March, I estimate unemployment in development areas at about 4.6 per cent., whilst in Clacton the average was well above 5 per cent. and has reached 6 per cent. In April, the unemployment percentage was 5.3 per cent. and the total was 739 people, of which 644 were men and 300 over 60.

This unemployment is double what it was during the period of Conservative rule. I am certain that the Government, to relieve such a high rate of unemployment, should relieve all those over 60 from attracting the Selective Employment Tax.

The Speaker

Order. Again, I think that this would require legislation.

Mr. Ridsdale

I am commenting on the difficulties of the elderly. Although legislation may be needed in the long term, this draws the Government's attention to the very severe problem which the over-60s in North-East Essex face. If one cannot raise these problems on an Adjournment debate—

Mr. Speaker

Order. The hon. Gentleman knows that I am not unsympathetic to him in any of the problems he is raising, but he cannot raise on the Adjournment problems which he can solve only by changing legislation.

Mr. Ridsdale

I do not wish to raise anything which will be out of order. The object of having this debate was to draw the Government's attention to the high unemployment rates in Clacton and to ask the Government what they will do to solve these problems. Will they help the elderly by making sure that they do not have to pay as much for National Insurance contributions as they pay at present? In what other way will they help the elderly in North-East Essex to face their very difficult problems?

What proposals has the Minister for helping the elderly with the very serious burden on the rates of the cost of education, especially since what is virtually a new town of 20.000 people has come to North-East Essex? There are also the further water and sewerage charges. Help goes to new towns. How does the Minister propose to help these people? Is it possible for areas like North East Essex which have absorbed the equivalent of a new town to get help?

The Chancellor of the Exchequer did not go out of his way in the Budget to help many of the people over 60. I said in the Budget debate that he was being mean, particularly to the over-60s, because they have had to bear the brunt of devaluation. Time prevents me from spelling out all the priorities I should like to see, but more should be done to help the chronically sick and those who have a chronically sick wife or husband. More help should be given to those looking after their parents.

We can only really help the elderly if we create more wealth with sensible economic policies, which, alas, we have not had for the past three years. All the good intentions in the world will not be the slightest help to the elderly or anyone else. No one realises that more than the elderly themselves after their bitter experience over the past three years.

2.10 a.m.

The Under-Secretary of State for Employment and Productivity (Mr. Harold Walker)

The hon. Member for Harwich (Mr. Ridsdale) has expressed with lucidity and cogency, in terms of his constituency experience, the concern and sympathy, which I am sure all hon. Members have for the problems of the aged.

He has presented problems which he said arise specifically in North-East Essex and he has made some general observations about Government policy which perhaps it would not be appropriate for me to seek to answer now.

A debate of this character spans the responsibilities of several Government Departments and the hon. Member will therefore appreciate my difficulty in seeking to reply to the various points he raised. Nevertheless, I will endeavour to answer some of the specific points which he brought forward.

North-East Essex can be defined as an area covered by three employment exchange area—Harwich, Colchester, including the Brightlingsea branch office, and Clacton-on-Sea. It is worth recalling that Harwich is a sea port for the Continent and provides passenger and goods services to Holland, Denmark, Belgium and Germany. It is largely self-contained, has some manufacturing industry and also a depot for Trinity House services. The surrounding area is agricultural. Colchester is an expanding town, largely self-contained with manufacturing industry and some agriculture. Clacton is mainly a holiday resort, a dormitory area for workers in London and other towns on the Eastern Region railway line. There is some light industry but in common with other coastal resorts unemployment is subject to fluctuations. For the greater part of the year in Harwich and Colchester the unemployment percentage is slightly lower than the rate for Great Britain as a whole. But admittedly in Clacton in July, 1966, it was three times higher than the rate for Great Britain. The percentage rate at the present time is more than double the rate for Great Britain. The seasonal fluctuations in Clacton are sharp. In April. 1967, the unemployment rate was 5.4 per cent. but by July this had fallen to 2.8 per cent. In a short period it had halved.

The figure for April, 1968, was about the same as that for April, 1967, and although it is too early to prophesy a similar fall this summer, the trend is in the same direction. It is estimated that at least half the males over 60 on the unemployed register in Clacton are occupational pensioners. Taking the areas as a whole, the unemployment is mainly in construction, insurance, banking, professional and scientific, public administration and other miscellaneous services. In the construction industry unemployment is in line with the national pattern. Males last unemployed in the construction industry represented about 222 per cent. of the unemployed, compared with 23.9 per cent. nationally.

One difficulty of Clacton is that it is favoured by retired people and the hon. Member pointed out that the unemployment register contains a relatively large proportion of old people. He also drew attention to the effect of the selective employment tax. As the hon. Member will know the Government have asked Professor Reddaway to inquire into the effects of the tax and he will also be aware that the Finance Act, 1967, contained a provision which came into effect on 4th September of that year which gave the Minister of Social Security power to reduce the tax in respect of part time employees working less than 21 hours a week. A further measure of relief is contained in the Finance Bill this year which reduces the rate for people over 65 by two-thirds. The new rates will be 12s. 6d. for men and 6s. 3d. for women compared with full rates of 37s. 6d. and 18s. 9d. respectively, if the proposals are accepted. This should forestall any tendency the tax might have to discourage the retention of the number of older people in service industries for which they are well suited.

There is, as yet, no formal evidence about the effects of S.E.T. on employment of the elderly and the breakdown of the June, 1967, unemployment figure is not yet available. There is, however, some evidence that employers tend to regard elderly people as a pool from which to draw in times of labour shortage. The lower rate of S.E.T. might encourage employers in the non-refund sector to make more jobs available for the elderly or to keep employees on beyond the normal retiring age. In the long run this will free a greater number of vacancies for younger workers in manufacturing.

One purpose of making this concession for the elderly is to secure a net addition to the labour force. The cost of the concession will be £3 million in 1968-69 and £9 million in a full year and it is estimated that some 130,000 men and 60,000 women will qualify. To have applied the concession to women at age 60 would have increased the numbers qualifying by 150,000 but the cost of the concession would have been half as much again.

The hon. Gentleman also raised the question of the rise in the cost of living. I draw his attention to the Written Answer given by my right hon. Friend on Monday, 20th May, which showed that the average annual percentage increase in the cost of living had been much the same for the period 1964–67 as it was during the previous 13 years. From 1951 to 1964, the average annual percentage increase was 3.4 per cent., whereas from 1964 to 1967 it was 3.7 per cent.—admittedly a little higher but only marginally.

The hon. Gentleman drew attention to the fact that there are in this respect the particular problems confronting people living in seaside resorts. It may well be that the reports my right hon. Friend has received from the Advisory Committee on the index of retail prices will have something to say about regional variations of this kind. But, of course, I cannot anticipate the contents of the report.

I draw his attention to the content of the debate we had on rising prices when my right hon. Friend and others, particularly my hon. Friend the Member for Huddersfield, West (Mr. Lomas) drew attention to the fact that there was considerable misunderstanding about the alleged rise in retail prices and an equal misunderstanding about the alleged holding down of wage rates.

According to the details given in the report on food prices, the holding down of the tendency to rise, compares very favourably with experience under the last Government. The hon. Gentleman referred to the 5,000 price increases registered by The Grocer since devaluation. What he must understand is that The Grocer is a trade publication which deals with figures for the trade which very often have no relationship to possible increases in the cost of living or of food prices.

For example, as pointed out in the debate by my hon. Friend the Member for Huddersfield, West, increases in the price of single commodities often result in figures given in The Grocer for a number of price rises many times that. He gave the example of canned peas, where a rise in the price of peas may be multiplied by a number of manufacturers, each multiplying that in turn for a number of sizes of cans, which may result in figures produced in The Grocer of 80 price increases for one rise in the cost of peas.

The hon. Gentleman drew attention to the difficulties in the provision of hospital facilities in the area. The North-East Essex area is served by the St. Helena group of hospitals which cater in terms of provision for those over 60. The estimated population in the area is 40,600. This justifies the provision of 406 geriatric beds if we follow the ratio laid down by the Ministry of Health in its hospital plan, which is a ratio of 10 beds for 1,000 population over 65. The actual number in his areas is 387. These are supplemented by 160 psycho-geriatric beds. The present distribution of these beds is 102 at St. Mary's, Colchester, 72 at Notley Hospital, Braintree, 145 at Heath Hospital, Tendring, and 63 at Myland, Colchester.

I regret that no dates can be given for the commencement of the later phases of the new hospital at Colchester or the Clacton hospital, but it is intended eventually to provide 336 geriatric beds at Colchester and 235 at Clacton. The number of geriatric beds in North-East Essex is 13–5 per thousand, and this compares very favourably with the 10 per thousand which is the figure in the Minister's plan and also compares very favourably with the North-East Metropolitan Region, where the figure is 11.1 per thousand.

The hon. Member referred to rates, and of course it is true that the ratepayers in North-East Essex have been affected, and also that rates have tended to rise, especially since 1962–63. But, these increases have been checked for householders in 1967–68 and 1968–69 by the new provisions for domestic rate relief and as a consequence of restraint upon incomes and public expenditure. The rate poundages of the local authorities in North-East Essex follow this pattern, except at Walton and Frinton urban districts, where the rates have continued to rise because of exceptionally heavy expenditure on new sewerage disposal schemes.

The anticipated Report of the Royal Commission on Local Government, which if, as expected, recommends larger units of local government, should help to ease the burden of rates where such large capital expenditure arises, and, so far as the present is concerned, I can tell the hon. Gentleman that at Harwich in 1967–68 there was a rate reduction of 6d., and in 1968–69, a reduction of 2d. In Clacton, the corresponding figures are an increase of 4d. and a reduction of 2d. Admittedly, some of the smaller local authorities had substantial increases, but those were not out of line with the tendency in the nation as a whole.

The area also has an exceptionally high proportion of ratepayers receiving rate rebate. The number of recipients in 1966–67 was 4,860, and in 1967–68 it was 4,665. These figures represent more than 12 per cent. of all domestic ratepayers, and as between 80 and 90 per cent. of the rebate recipients in the area were retired people, they must have comprised a substantial proportion of all the retired ratepayers. In addition, a further proportion of retired people are getting their rates met by the Supplementary Benefits Commission. Figures for this area are not immediately available from the Ministry of Social Security, but studies made in other areas suggest that the proportion may be around 30 per cent. It seems probable that at least 50 per cent., and possibly as many as 60 per cent., of retired householders in the area are getting help with their rates; and nearly of this help comes from the Exchequer.

I hope that, in the short time which has been available, I have been able to answer at least some of the points which the hon. Member has raised. He referred to heavy costs of education, but we cannot deal adequately now with a problem of that nature. I would point out to him that, while there is here, specifically, a call for more expenditure, it comes at a time when members of the Opposition are pressing hard for more cuts in Government expenditure. Yet, here again, there have been some substantial increases in expenditure since 1964. While it might have been necessary to hold back a certain amount this year, in real terms the increases will continue.

In conclusion, I would express my appreciation to the hon. Member for the opportunity that he has given me to discuss this very important matter. I am sure that his constituents have good reason to be grateful to him, particularly those in the age groups he has discussed. I know that he has, on previous occasions, drawn the attention of the House to the particular problems in his area. I have not the slightest doubt that he will do so again when the opportunity presents itself in the future and seek to pursue these points with which we have not been permitted, because of shortage of time, to deal fully this morning.

The Question having been proposed after Ten o'clock on Thursday evening and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at twenty-five minutes past Two o'clock.