HC Deb 24 November 1981 vol 13 cc744-5
11. Mr. Newens

asked the Secretary of State for Social Services what steps he proposes to take to make good any shortfall in the value of the increases in pensions and other benefits payable from 23 November due to any underestimate made in the likely rate of inflation.

14. Mr. Foulkes

asked the Secretary of State for Social Services whether he is satisfied that the increase in pensions and other benefits payable from 23 November is sufficient to compensate for the increase in prices since the last uprating in 1980.

22. Mr. Carmichael

asked the Secretary of State for Social Services whether he will ensure that the increase in pensions and other benefits payable from 23 November is sufficient to compensate for the increase in prices since the last upating in 1980.

Mr. Fowler

The extent of any shortfall this year will not be known until next month. But, as I made clear on 6 November, the Government have given a commitment that we will fully compensate pensioners for price increases over the lifetime of this Parliament. Therefore, any shortfall in this month's uprating of retirement pensions will be made good at the next uprating.

Mr. Newens

Last year the Government hurried to introduce legislation that had the effect of preventing pensioners from receiving increases in excess of the cost of living increase. Against that background, would it not be shameful, if pensioners were left for the whole of the year until their next increase without any steps being taken to provide for a supplementary increase? That would be especially shameful, as they will be 3 per cent. worse off this year as matters stand.

Mr. Fowler

I understand the hon. Gentleman's argument. However, successive Governments have considered that annual upratings provide the only practical way of dealing with 8 million or 9 million pensioners. I cannot promise any change in that procedure.

Mr. Foulkes

Will the right hon. Gentleman confirm that yesterday's increase cheated pensioners out of 3 per cent. of the increase that was due to them? Does he agree that next November will be far too late for the many pensioners who will have died by then? Will he make a prompt announcement about an early increase to make good the shortfall?

Mr. Fowler

I entirely reject the hon. Gentleman's approach. We have made it clear throughout—I shall continue to repeat the Government's pledge—that we shall retain the value of the pensioners' pensions. That continues to be our policy. Pensioners have been protected against price increases, and since November 1978 pensions have risen by nearly 52 per cent.

Mr. Buchan

Does the right hon. Gentleman accept that the other key link is the relationship to earnings? Last year the Government introduced a Bill to claw back from pensioners a miserable 1p in the pound. Why cannot they restore the position? Each married pensioner is losing £1.20 from his uprating because of the Government's action. The Government could introduce an interim measure. They could attach the increase to the Christmas bonus, for example, to ensure that pensioners get back the 3 per cent. for the rest of the year. Methods are available to the Government and one was found, for example, in 1975. Is that not right?

Mr. Fowler

The hon. Gentleman must know that items such as the Christmas bonus were settled months ago. The extent of the shortfall will not be known until next month. We shall have to continue with the annual uprating, which I think is the fairest and most reasonable way of proceeding.

Mr. Buchan

This is the most serious shortfall that we have had, against the background of a specific cut that was made last year. That was done despite the Prime Minister's commitment that she would act in the lifetime of this Parliament. However, old people will still be deprived of their rights for the remaining 12 months. If the Government need a fresh Bill——

Mr. Speaker

Order. It is not fair to argue a case now. It is Question Time.

Mr. Fowler

I repeat that the Government will continue to protect pensioners. I cannot and will not give the sort of commitment that the hon. Gentleman wants. If he were in my position, I do not believe that he would be able to do so either.