HC Deb 29 April 1980 vol 983 cc1140-2
11. Mr. Stallard

asked the Secretary of State for Social Services what representations he has received from pensioner organisations about the effect of the Budget on the elderly.

13. Mr. Bowden

asked the Secretary of State for Social Services what representations he has received from pensioner organisations about the effect of the Budget on pensioners.

16. Mr. Foulkes

asked the Secretary of State for Social Services what representations he has received from pensioner organisations about the effect of the Budget on the elderly.

The Minister for Social Security (Mr. Reg Prentice)

I am aware of only a very few such representations, and these have been concerned with our proposals relating to the uprating of benefits, the freezing of the retirement pensioners' earnings rule, the limitation of unemployment benefit for occupational pensioners and the date for this year's uprating.

Mr. Stallard

Will the Minister accept from me that pensioners throughout the country are angry and disappointed that the old rate of pension will be paid for 54 weeks instead of 52? This means that a single pensioner will be cheated out of £7.70 and a married couple out of £12.30. Is he aware that the amount saved by the Government by this shabby measure will be double that which was given away in the heating allowance? Is he not ashamed of this example of sharp practice by his Government?

Mr. Prentice

No. The choice of expenditure reductions in order to contain the growth of the social security budget, which is still growing, meant some difficult choices and this one certainly was difficult. However, we need apologise to no one for bringing the growth of the social security budget under some control.

Mr. Bowden

Is my right hon. Friend aware that there is widespread disappointment that the earnings limit was not increased in the Budget? Will he confirm that it is the Government's intention to phase out the earnings rule during the lifetime of this Parliament?

Mr. Prentice

It is our intention to phase it out as soon as circumstances allow. We certainly hope that the freezing of the earnings limit will be for one year only.

Mr. Foulkes

Will not the Minister concede that, because of the shortfall in the current year that the Government have failed to make up, because of the delay of two weeks in paying this year's pension, and because the increase is nowhere near keeping up with the current level of inflation, however much the Secretary of State goes around arrogantly saying "We are doing our best for the pensioners", no one, least of all the pensioners, believes a word?

Mr. Prentice

That sort of language is quite inappropriate to a situation in which the rate of retirement pension will be increased by nearly £4 a week for a single pensioner and by over £6 a week for a married couple in November. I find that many pensioners understand the need for economic restraint being practised by the Government. They understand that good housekeeping applies as much to national housekeeping accounts as to family accounts.

Mr. Thompson

Will not my right hon. Friend agree that the elderly are far more worried about the forthcoming actions of the TUC and the threat of world war than they are about the Budget?

Mr. Prentice

The pensioners are worried most of all about the extent to which inflation over many years has eaten into the value of their pensions. It is a duty that I believe is incumbent on all hon. Members to urge restraint on the trade union movement in the present situation.

Mr. Freeson

Are not the right hon. Gentleman and his colleagues aware that their proposals to increase pensions in November, based upon a 16½ per cent. forecast inflation rate, means, effectively, that there will be a cut, in real terms, in the increase of about £1.50? Ought not the forecast basis to be increased to at least 20 per cent.? Do the Government intend to act now, not in November, to make proper calculations, based upon the real rate of inflation, instead of the phoney figures that they are now using?

Mr. Prentice

No, Sir. A careful calculation was made by the Treasury before the Budget speech. Its calculation was 16½ per cent. As my right hon. Friend said, in response to an earlier question, it is not appropriate for anyone on either side of the House to speculate on whether that will be exactly the right figure.

Mr. Stoddart

Is the right hon. Gentleman aware that I have received many bitter letters from old-age pensioners who believe that the Government are guilty of sleight of hand in the matter and that they are forcing the pensioners to pay for their own Christmas bonus?

Mr. Prentice

I am interested that the hon. Member has received several letters. I have had exactly one. I meet a great many pensioners in my constituency. They say to me that it is about time that we had a Government who practise economic disciplines. Their words to me are "Don't be diverted by the criticism. Keep on with the good work".

Mr. Stallard

On a point of order, Mr. Speaker. In view of the totally unsatisfactory nature of that reply, I give notice that I intend to raise this matter on the Adjournment at the earliest possible moment.