HC Deb 06 April 1982 vol 21 cc816-7
8. Mr. Knox

asked the Secretary of State for Social Services what representations he has received about the proposed increase in the capital limit for supplementary benefit.

Mr. Fowler

I have received a number of responses but to date only one written representation, from the Child Poverty Action Group, which has given a qualified welcome to the proposed increase.

My hon. Friend may like to know that I am today making available in the Vote Office and placing in the Library copies of the supplementary benefit policy inspectorate's report on the operation of the capital rule. We shall welcome observations on it. As the House knows, we are in any case proposing to increase the disregard from £2,000 to £2,500 in November.

Mr. Knox

Is not the figure of £2,500 absurdly low and a disincentive to thrift? Should not the figure be nearer £5,000? Does not my right hon. Friend agree that, even if a person has more than £5,000, he should not lose all entitlement to benefit?

Mr. Fowler

I am sympathetic to the general point. However, we have just increased the disregard to £2,500. We shall continue to keep the level under review, but I cannot give any further commitment at this stage.

Mr. Mike Thomas

Does the Secretary of State believe that it is right that terminally ill patients should be asked to surrender their life insurance policies, which are to provide for their dependants after their death, as a condition of receiving supplementary benefit?

Mr. Fowler

When the hon. Gentleman has had a chance to look at the supplementary benefit policy inspectorate's report, he will realise that life assurance policies are covered by it. I should welcome the hon. Gentleman's views, and the views of other hon. Members, on that matter.

Mr. Neubert

Would my right hon. Friend be prepared to consider the possibility of giving added weight to the age factor in the assessment? Is he aware that the present system tends to penalise the elderly, who belong to a generation for whom thrift has always been a characteristic and commendable virtue?

Mr. Fowler

I shall consider that point. Again, I ask my hon. Friend to read the inspectorate's report, which, as an exceptional measure, we are making public and making available in the Library. The report shows that there is no evidence of significant personal hardship, but I shall consider all representations on the matter.

Mr. Campbell-Savours

How does the Minister respond to the suggestion by the Child Poverty Action Group that there is no substantial national guideline laid down whereby the treatment of people in one part of Britain is the same as in another?

Mr. Fowler

I have asked for a report on the case that the Child Poverty Action Group put before us. I await the outcome of that report.

Mr. Hicks

In addition to the thrift argument, does my right hon. Friend agree that too rigid an application of the present capital regulation leads to a host of unpleasant circumstances in individual families?

Mr. Fowler

We have made the change to a cut-off. The reintroduction of a tapered system would be a complicated and costly measure, and the inspectorate's report does not make a case for it.

Mr. John

Does the right hon. Gentleman accept that the capital limit for a single payment is only £300 and was not raised in the Budget? The report of the Social Security Advisory Committee recommends an increase. What do the Government propose to do about it?

Mr. Fowler

I am conscious of that recommendation. We shall keep the matter under review.