HC Deb 23 March 1976 vol 908 cc184-6
8. Mr. Dempsey

asked the Secretary of State for Social Services what consideration has been given to the policy of providing weekly retirement pensions for couples at the rate of 50 per cent. of the average weekly earnings and 33⅓ per cent. for single pensions; and if she will make a statement.

Mr. Meacher

The proposal my hon. Friend is putting forward has been discussed with the TUC on several occasions. Its cost would be very substantial. If applied to all benefits it would add more than £4,800 million a year to the cost of social security. The Government's plans for better pensions will enable workers to qualify in future for the kind of earnings-related pensions which are now only provided by good occupational schemes.

Mr. Dempsey

Is my hon. Friend aware that most pensioners are more than grateful for the very generous increases given to retirement pensioners by our Government in the shortest possible space of time? Does he not think that we should aim at something much more permanent, along the lines framed in the Question, and set our sights to achieve that objective, in view of the fact that this policy enjoys the support of a very broad section of the Labour movement?

Mr. Meacher

My hon. Friend is quite right in saying that under the present Government pensioners have obtained a significant increase in the real value of their standard of living. As to his proposal, he will know that this is the principle underlying our own social security scheme, which is shortly to begin coming into operation, as a result of which the average paid person will indeed receive a pension of about half his average earnings, and the lowest paid will receive a pension of more than 100 per cent. of his previous earnings.

Mr. Patrick Jenkin

Does the hon. Gentleman agree with the writer of the article in Labour Weekly of 5th March that the tax and social security systems are now "so full of anomalies" that a radical re-think is necessary, including some of the sacred taboos of the Labour movement"? Will the hon. Gentleman and his right hon. Friend now swallow their pride, forswear their reprobate past, and admit, with the writer of the article that tax credits are the right solution to the problem?

Mr. Meacher

The hon. Gentleman seems to be unaware of the policy of his own right hon. Friend the Shadow Chancellor of the Exchequer, who, in another article, which I should have thought the hon. Gentleman would have seen, recognised that the tax credit scheme, as proposed by the Conservative Party, was in that form a non-starter. The hon. Gentleman has to tell the House how his party would raise £3 billion, which is what that scheme would now cost.

Mr. James Lamond

Will my hon. Friend confirm that the Government's White Paper on Public Expenditure contained an absolute commitment to maintain retirement pensions at their present level relative to the income of the community as a whole, and that there is provision within it to bring about an improvement in retirement pensions?

Mr. Meacher

My hon. Friend will know that as a Government we have committed ourselves to increasing the real value of the pension, in line either with earnings or prices—whichever is more favourable for pensioners—on a statutory basis for the first time. As to the White Paper, my hon. Friend will also know that this entailed an increase in the commitment of public expenditure for the purposes of social security.