§ Mr. Speaker
I have to announce that I have selected the amendment in the name of the Prime Minister. Before we start the debate, I point out that no fewer than 34 hon. Members have so far sought to take part and I appeal for brief contributions. If we have them, I shall be able to call a great many of those hon. Members.
§ Mr. Robin Cook (Livingston)
I beg to move,That this House expresses its concern at the evidence of the hardships caused by the recent changes in housing benefit to many individuals, particularly pensioners with property which is for sale but has not been sold, modest savings or small occupational or disability pensions; recognises that Her Majesty's Government may not have fully appreciated this degree of hardship in framing the new regulations; and calls upon Her Majesty's Government to raise the capital disregard so that no one with less than £10,000 in capital assets loses housing benefit, and to relax the taper by which housing benefit is reduced for claimants with any income above the poverty line.When the House first debated the changes in housing benefit three years ago, we were repeatedly told that they represented the most fundamental change in the welfare state for 40 years, that they were the outcome of the most profound review of the welfare state for 40 years and that they must be designed to stand the tests of the next 40 years. The then Secretary of State for Social Services, when speaking in the debate on the consultation paper in 1985, said that the changes must prepare the welfare state for the next half century.
Far from standing the test of the next 40 years, the changes in housing benefit have not survived the test of the first four weeks. Already, over the past three days, we have seen a series of hurried and frenetic meetings between Ministers, interrupted on one occasion, so we are told, by President Mugabe, to get together a package of emergency sticking plaster to put over the cuts. Why? Because the system they introduced after that fundamental and profound review has proved harsh in its social consequences and embarrassing in its political consequences.
In the last debate on the issue, the Secretary of State and the Minister of State took care to remind us that it had been thought up three years ago. On the surface, they meant that it should have been opposed then and not now. However, the sub-text of what the Ministers were saying was equally clear. The sub-text was that as they were not in office three years ago, they should not be blamed for the measure, as they were both somewhere else.
The air is already thick with the grinding of alibis. Last Friday, in that curious way that the press have of suddenly being told something, it emerged that the former Secretary of State, the present Secretary of State for Employment, had never supported the figure of £6,000. He had always wanted a figure of £10,000, but the figure of £6,000 was imposed on him. There is only one person who could have imposed such a figure. Yesterday. I read in one of the papers a report still sticky with the thumbprint of Bernard Ingham, which stated that the Prime Minister was furious 352 with Ministers for not foreseeing the row over the new rules. Suddenly, no one wants it to be thought that they had thought up the new rules.
There is no doubt where we stand. From the moment that this issue was first debated, we vigorously opposed the changes. It was our view that one could not without hardship force up rents and force up rates, as the Government have done, and simultaneously cut the housing subsidies to the poorest. It is not just the Labour party that opposed these cuts three years ago. The Child Poverty Action Group, the National Association of Citizens Advice Bureaux, the National Consumer Council, Help the Aged and every local authority association warned the Government that the cuts in housing benefit were impractical and indefensible.
The only organisation unreservedly to support the proposals on housing benefit was the Institute of Directors—not the most obvious source of advice on the problems and experiences of social security claimants. Nevertheless, Ministers chose to take that advice. Having marched on with the proposals in defiance of the criticism of all informed groups and all representative organisations, they have only themselves to blame if they are obliged to beat an ignominious retreat.
The motion magnanimously recognises that Ministers may not have appreciated the hardships that the change will cause. Eagerly, I turned to the amendment tabled by the Secretary of State for Social Services and his right hon. Friends to see if at least that passage had been accepted by the Government. Sadly, I found that that sentence would also be deleted.
The truth is, as Ministers know, that the two alternatives before them are equally uncomfortable. Either they knew that the changes would cause the degree of hardship that we have witnessed in our surgeries, in which case it was cruel to persevere with them and dishonest to conceal it from their Back Benchers, or they did not know, in which case somebody along the line has been guilty of incompetence on a heroic scale. Charitably, I am inclined to believe the latter explanation.
§ Mr. Jonathan Sayeed (Bristol, East)
Will the hon. Member explain to the House why it is Labour party policy that those who have capital should be subsidised by those who are on low incomes and have no capital?
§ Mr. Cook
It is perfectly true that the previous Labour Government, and every previous Conservative Government did not apply a capital rule to the treatment of housing benefit or to the rent rebate system that went before it. It is wholly unjust and unreasonable that people with modest savings of £3,000 to £6,000 should be treated as if they are receiving an interest rate of 20 per cent. per annum. Later in my speech, I shall tell the hon. Gentleman about a particular case in my constituency. I shall be interested to hear if it was Conservative party policy to hit my constituent in that way. My constituent will be equally interested, as she has voted Conservative in all her 84 years.
All the evidence coming in is that the cuts have resulted in financial cuts well in excess of the Government's estimates. We now have the data from the first local authorities that have completed the transfer of claimants to the new assessment. We know how their expenditure under the new scheme compares with their expenditure under the old scheme. The drop is dramatic.
353 The Government repeatedly told us that the "savings", as they prefer to express it, would amount to £650 million as against expenditure this year, had the previous system continued. That is an 11 per cent. cut. The experience of every local authority to which I have spoken is that they are experiencing cuts well in excess of that figure.
Glasgow finds that its expenditure has gone down by £22 million, compared with last year. That is a 15 per cent. cut on last year's expenditure, and it is a 21 per cent. cut in what it might have expected to spend this year. If Glasgow's experience is typical, the cuts across the nation are not £650 million; they are £1,200 million.
Nor is Glasgow the worst. In Renfrew, expenditure is down 18 per cent. on last year and it is 24 per cent. down on this year. The most spectacular is my local authority, West Lothian, which is down 25 per cent. on last year and 30 per cent. on this year—almost three times the Government's estimate.
The local authority has supplied me with a table of losers, banded by the amount that its tenants lose per week. It provides an illuminating contrast with the bland assurances given to the House by the Government. Ministers predicted that 8.6 per cent. of claimants would lose over £5 a week. The figures prepared by my local authority's officials, working in the real world and with real tenants, show that 21 per cent. are losing over £6 a week and that a staggering 11 per cent. are losing over £12 a week. The director of finance has already received three threats of suicide from tenants in the past fortnight.
§ Mr. David Young (Bolton, South-East)
Could I put this in human terms? The case of Miss Turnbull was mentioned last week in The Guardian. As a result of the Government cuts, she will be forced to give up her job, because her mother owns a small house, and remove her mother from nursing care, or she will have to put the onus on the owner of the private nursing home either to subsidise the lady, who needs nursing care, or to expel her. Is that what we mean by a caring Tory authority?
§ Mr. Cook
My hon. Friend suggests that there are a number of cases, to which I shall turn in a moment, where, far from providing an incentive to work, the rules make it almost impossible to reconcile family commitments with their work.
Given the unexpected ferocity of these cuts, much talk of "anomalies" is now emerging from ministerial briefings. Out there, apparently, there are 5.5 million anomalies who have just seen their housing benefit cut. In the last debate a fortnight ago, the Minister of State accused us of scouring the country looking for hard luck cases. I assure him that we do not need to scour the country; they tumble out of our mail bags. Those are the kind of letters that I alone have received in the past two weeks. They fall into our surgeries every time we open the door. People ring our offices and our homes.
Having counselled many of those who have been shocked by the loss of their housing benefit, I warn the Government that there are three stages to their reaction. The first is disbelief that the sums can be correct. The second is despair at how they can make ends meet. The third is anger that they should be required to make such sacrifices, an anger that flares all the more fiercely when they compare their losses this month with last month's 354 Budget that conspicuously did not ask for sacrifices from people rich beyond the dreams of anybody on housing benefit.
Let me share with the House some of the cases which I have had to counsel. On Friday I visited a constituent who is an elderly lady living by herself. She retired early due to an industrial injury to her back from lifting refrigerators around a showroom and received severe disablement allowance. She has lost £32.60 a week in housing benefit. After paying rent and rates, her weekly income has fallen from £78 to £47. When I visited her, she was arranging to have her telephone removed. She had just spoken to her granddaughter to explain that she would no longer be able to afford the presents which she used to purchase. A telephone to the outside world and the ability to play one's part in the family are important parts of being able to serve one's retirement in dignity. I cannot get my mind around the idea that there are those who would justify visiting such a devastating drop in income on an elderly person.
Then there are families with children. I received a letter from Mr. and Mrs. Shippam in Wigan who have two children. Mr. Shippam is on a job training scheme. His misfortune is that he receives special hardship allowance, which takes him well over the limit for the housing benefit threshold. He has lost £13 in housing benefit and £6 in free school meals. The total lost to that household is £19 out of a total income of £105. Lest the Government ask us how much that family has gained in family credit, I remind Ministers that Mr. Shippam is on the job training scheme and has been refused family credit, as he is counted as not being at work.
Then there is the case of Mr. and Mrs. Brown of Windermere. Mr. Brown is a gardener who gets take-home pay of £82 a week. On that, plus child benefit and family credit, Mr. and Mrs. Brown bring up four young children. Yes, Mr. and Mrs. Brown get family credit and, yes, their family credit has gone up by £14. But they have also lost £19 in housing benefit, £10 in free school meals and £2 in milk tokens. They are £16 a week worse off, even allowing for the increase in family credit. How does the party of family values reconcile that cut imposed on a couple struggling to hold a family together on a low wage? Mrs. Brown's letter used words to this effect: "Yesterday when I received the notification of housing benefit, I spent most of the day in tears. Today has not been much better."
I turn to the treatment of young people. It is difficult to think of a better way of removing the incentive to work than the way that young people are treated under the housing benefit rules. Because young people are now entitled only to a new junior rate of benefit, they start losing housing benefit at the rate of 85p in the pound on any income over £26. Last week in Norwich I met a chef in the National Health Service earning £61 a week who had just lost £24 a week in housing benefit. My hon. Friend the Member for Caerphilly (Mr. Davies) has informed me of young people in his constituency who are employed on £55 a week as wardens of sheltered units. It is a condition of the job that they have to be tenants of one of those units and, therefore, they have no control over housing costs. They have just seen their rent and rates go up sixfold.
These cases will be no worse off—indeed, they might even be better off—if they gave up work, except for the fact that a month ago, perhaps prudently anticipating these changes, the Minister of State took powers to stop their benefit for 26 weeks if they gave up the struggle to square poverty wages with miserly benefits. None of the cases to 355 which I have referred would remotely benefit from the change in the savings rule which we are told we might hear about this afternoon.
The savings rule is devastating in its impact on those caught by it. I turn to the case of the constituent to which I referred the hon. Member for Bristol, East (Mr. Sayeed). That constituent is a staunch Tory voter. Indeed, in her letter she said that she wrote to me with "great reluctance", as I was a Labour Member of Parliament. She has just over £6,000. Her only income is a non-contributory pension and the income from £6,000. Together, that gives her a weekly income of £32 a week. She has now lost all her housing benefit. Her weekly rent and rates demand is £29 a week, leaving her £3 a week to live on.
A moment's contemplation shows that such a rule is preposterous and I shall readily give way to the hon. Member for Bristol, East again, if he is prepared to defend his claim that that is Conservative Government policy. Even the readers of The Sun have grasped that the rule is unfair and have voted by three to one on The Sun hotline to scrap it.
I welcome the fact that the Government, although they will seek to delete that part of my motion calling for a change in the rule, appear to have decided to change the rule. That is quite a turnround from the position of only three weeks ago. We know from the leaked minute of the Cabinet Sub-Committee that, only three weeks ago, the Prime Minister presided over a meeting at which she was plotting even further cuts in housing benefit. Now, instead of more cuts, we are to have higher expenditure. Supply day debates are starting to become expensive for the Chancellor of the Exchequer. We must try to make them more expensive.
As Ministers have accepted that part of our motion, I am all the more disappointed that they appear to be resisting the remainder of the motion, because, although a change in the savings rule will be welcome to those people hit by that rule, they are relatively few. To put them in perspective, such a change would help 150,000 claimants. The Government admit that 5.5 million people, the vast majority of whom have no capital to their names, are losing as a result of the changes. If we are to help those people and to relieve the harshness of any of the other cases that I have quoted, we must tackle the sharp and cruel taper which provides such a savage clawback of benefit.
There is one compelling reason why Conservative Members should think about changing that clawback and helping those 5.5 million people. The majority of those people are in Conservative constituencies. Fifty-five per cent. of all losers under the new rules have a Conservative Member of Parliament. On average, every Conservative Member has 7,500 losers in his constituency. To express that point more crudely, in case its significance has been missed, that is more than the majority of 115 Conservative Members.
We have been accused of drafting a motion that embarrasses the Conservative party. It is embarrassing only because many Conservative Members agree with it. If they want to see it passed, they must vote for it. That may be politically embarrassing, but I can assure them that it will be nothing like as politically embarrassing as it will be in their constituencies, if they vote against the motion.
In case Conservative Members are too embarrassed to ask the questions, let me close by leaving the questions that the Secretary of State must answer when he responds to 356 the debate. We were told that the new system would be fairer. Where is the fairness in the way that the system has hit the cases that I have quoted and in the letters that I and my hon. Friends have received? We were told that the new system would target those in need. If those cases that I have quoted are not in need, then who is in need? We were told that the changes would help families with children. It is evident that the changes leave families with children worse off to the tune of large sums of money per week. We were told that the changes would increase incentives to work. The changes plainly penalise families on a low wage, pensioners with part-time earnings and youngsters starting at the very bottom of the labour market.
Yesterday, the Prime Minister said that the major structure of the housing benefit system would remain substantially the same. The letters that I have received and the cases that I have quoted provide a devastating case as to why that substantial structure of the new system is totally unsound. Tonight the House must vote to take apart that new structure and to rebuild it.
§ The Secretary of State for Social Services (Mr. John Moore)
I beg to move, to leave out from "House" to the end of the Question, and to add instead thereof:'recognising that social security spending has risen by nearly 40 per cent. in real terms since 1979, and now totals almost £48½ billion, and that spending on housing benefit last year amounted to over £5 billion and went to over 7 million, or 1 in 3, households in this country, commends Her Majesty's Government for its determination to tackle the complexities and unfairnesses of the old system.'.So far, the debate has concentrated, as does the motion, on one aspect of social security changes—housing benefit. Before I respond and tell the House about the Government's proposals, as the hon. Member for Livingston (Mr. Cook) legitimately asked, my hon. Friends will want me to remind them of some of the substantial achievements that are embodied in the new benefit system. I shall briefly do so.
It is a simpler system, that people can understand. It gives more help for most disabled people and most families with children. In terms of fairness, in many ways it is a major improvement in respect of incentives. Hon. Members will remember the old family income supplement system, whereby a family could be better off earning £75 than £150. The perverse incentives of the old system have entirely gone. The new system has also ended the runaway spending under an abused single payments system, part of the unemployment trap. That was utterly unfair to those m work.
§ Mr. Moore
I shall give way in a second.
The major achievements meant that there would be inevitable changes and that, as hon. Members have recognised, they would be controversial. That was especially true in relation to housing benefit.
Throughout the reform debates over the past few years, Conservative Members did riot believe that it was right—they expressed the view many times—to help as many as one out of three families with their housing costs. Therefore, since 1985, the Government have made it clear that we would tackle that. Ironically, in relation to what the hon. Member for Livingston said, the need for 357 structural reform of housing benefit was the social security matter of greatest consensus throughout all parts of the country.
Despite what the hon. Member for Livingston said, the Green Paper and subsequent debates produced little disagreement with the structural proposals. I recognise the point that was made. Today's debate and the criticisms are about the effects on some people at the point of the change—I recognise that individuals have been mentioned—but I stress the key point that they are all individuals above the income support level.
It is important briefly to consider the reason for the general agreement that existed on the need for reform of the old system. Two things were critically wrong with it. First, it was hideously complicated—no hon. Member who had constituency surgeries over the years, let alone those who sought to help claimants, would deny that—and, secondly, it was indefensibly unfair.
§ Mr. Moore
I shall refer to that point in a moment.
The worst feature of the system was the unfair way in which it operated against people in work. For those out of work and on supplementary benefits, quite properly the old system paid 100 per cent. of rent. For those not on supplementary benefit but with similar incomes, the calculations were based on 60 per cent. of rent. We were in a position that we all knew was ridiculous—someone was much worse off simply because his income came from work, while his neighbour's came from benefit.
Faced with such unfairness or injustice, what can a Government do? [Interruption.] That is precisely what we would expect from the Opposition. A Government can do what Opposition Members did when they were in office—nothing at all, because any change would provoke a storm. It is no good Opposition Members pretending that, when they were in office, they did not know about the fundamental unfairness in the problem. They knew about the problems.
In 1976, the Supplementary Benefits Commission highlighted the inequality between the treatment of those in work and those on benefit. It pointed out to the then Government—the Labour Government—that 400,000 families were receiving less than they were entitled to. Faced with the complicated choice between asking for help with housing and approaching their local authorities and social security offices, they made the wrong choice. That was an outrage that the Labour Government ignored. They accepted it and did nothing to tackle fundamental reform.
This Government were not prepared to ignore the problem. The reforms of 1983 and 1986 have got the structure right. What that means—most outside observers accept this—is that people in work, or out of work, and with the same characteristics or level of income, will receive the same level of help. That must be right, and it is a major achievement. The Opposition funked reform, but my right hon. and hon. Friends, rightly, would have wished me to do what I have been doing in the past few weeks—listening carefully to them. They expect the Government to watch carefully and to monitor the changes. [Interruption.] I recall that not too long ago we 358 had debates about the social fund and one or two other issues. The changes about which we were talking affect 8.5 million citizens—not simply those changes we are addressing today, which only affect those above income support level.
My right hon. and hon. Friends would expect me to listen carefully, and they have used Parliament and information from their surgeries to draw my attention to problems. They and I would not be surprised if, in the biggest structural change for 40 years, there were not some areas that merited not only concern but action. While they welcomed—[Interruption.]
§ Mr. Speaker
Order. This is a very important debate. I know that the whole House is anxious to hear what the Secretary of State has to say.
§ Mr. Moore
While the overall structural reforms and the many improvements that I have outlined have been welcomed, since the introduction of the new housing benefit scheme, hon. Members—particularly my hon. Friends—have raised a series of concerns about how some aspects of the scheme have worked in practice. I wish to respond to those concerns.
§ Sir Peter Hordern (Horsham)
The reform of social security is not only long overdue but wholly welcome, and my right hon. Friend is to be congratulated. The issue causing concern among some hon. Members is housing benefit. It is the Government's policy to encourage local authorities to increase the return on their assets by increasing rents. That places an unconscionable strain on those who have been accustomed to housing benefit but who, because of the £6,000 limit, will no longer receive it. Will my right hon. Friend address himself to that particular point?
§ Mr. Moore
My hon. Friend will be delighted to hear that I am moving to that point.
I wish to respond to hon. Members' concerns in a number of ways, which I believe recognise the most serious difficulties experienced at the time of the change over. The issue that has been most often mentioned—my hon. Friend the Member for Horsham (Sir P. Hordern) mentioned it again—in public discussion of the new housing benefit scheme is the capital rule. Most people accept the need to take capital into account and to have some limit. The problem is a difficult one, even given that general agreement.
None of us wishes to discourage people from saving, yet it is clearly wrong that the taxpayer should be expected to pay the rents and rates of people who have some capital and could be expected to draw on it. The question is what the level should be before they turn to their fellow citizens. I recognise that the £6,000 limit in particular has been the cause of concern. I am responding to those concerns today by increasing the limit to £8,000. [Interruption.]
§ Sir Anthony Grant (Cambridgeshire, South-West)
My right hon. Friend is aware that some of us have been critical not of the principle but of the detail of the reforms. Is he aware, therefore, how we appreciate the way in which he has responded to the advice of his loyal friends, which is particularly wise given that the official Opposition are hopelessly ineffective? What would the capital disregard be today if the figure of £6,000 in the Green Paper of 1985 had
§ Mr. Donald Anderson (Swansea, East)
Is the Minister saying that, with all the wealth of expert advice that was available to him before these changes, he was incapable of foreseeing the suffering and anxiety that his proposals would cause?
§ Mr. Moore
The increase will bring considerable extra help to a further 100,000 people. It will be effected by a change in the regulations, about which we shall quickly consult local authorities so that it can come into effect as soon as possible. It will cost £30 million.
There is a second question concerning capital where I believe that a change is merited. Under the new regulations, a person entering a care home is excluded from income support from the moment that they become resident if their former home is worth more than the capital limit.
The thinking behind the change is sound. The old system was wide open to abuse by those—perhaps the families of claimants—who made little effort to sell the home, while the taxpayer paid large sums to cover the care home fees. In one instance, the property remained unsold for 10 years.
The new regulation is too inflexible, and we must have regard for the genuine difficulties that some elderly people have faced. I cannot return to the previous position of laying the taxpayer open to exploitation, but I propose to relax the regulation to allow people six months in which to dispose of their property. In exceptional circumstances of genuine difficulty, that time could be extended. Such judgments will be for adjudicators, subject to the usual appeals procedures. The regulations will be introduced soon, but local offices can make payments as though this relaxation had been in force since 11 April.
§ Mr. Bowden
I am deeply disturbed that, if I have understood my right hon. Friend correctly, although he is increasing the basic capital figure from £6,000 to £8,000, he is not altering the basic tariff. If he will not alter the figure of £3,000 at which full housing benefit would become applicable, a pensioner who has £6,000 saved and receives only a state pension will lose over £8 per week. I believe that to be completely wrong.
§ Mr. Moore
I shall not give way again—[Interruption.]—because if my hon. Friend and other hon. Members will listen until I have finished, they might be pleased to hear what I am about to say.
360 The House will know that we have already acted so as to ensure that where, for example, a wife has to leave the marital home because the marriage has broken down, she will not be excluded from benefit.
These measures are important but are not in themselves sufficient to deal with the difficulties of which we are aware, and which hon. Members, including the hon. Member for Livingston, has raised. There is a group of people on quite low incomes and without significant capital who have lost largish sums in housing benefit because of the interaction of various parts of the new scheme.
One important factor has been ending most local authority discretion to run different schemes of housing benefit. That decision was right. It cannot be fair that in different parts of the country different rates of benefit should be paid and different rules applied. That had to end as part of the reforms, although, of course, we have left it to local authorities to maintain the most widely used discretion in respect of war pensioners and war widows. Other losses have occurred—for example, through ending the old housing benefit supplement. We think it right to ease the transition in such cases.
We do not think it right to compensate for those increases in rents introduced to coincide with the new housing benefit scheme, nor increases in rates. That would cut across our firm purpose to increase local authority accountability. But we intend to offer transitional help to those significantly affected by the changes to the scheme, including the ending of local authority discretion.
I propose to make good those housing benefit losses in excess of £2.50 per week arising from the changeover to the new scheme which have affected pensioners, disabled people, families with children and lone parents. We estimate that perhaps 300,000 people will benefit from this. We will be spending an extra £70 million in this way.
§ Mrs. Margaret Beckett (Derby, South)
Did I understand the Secretary of State to say that this applies to people on housing benefit supplement, or does it apply more widely?
§ Mr. Moore
This covers those above the income support level who may have suffered by more than £2.50, if they are pensioners, disabled people, families with children and lone parents.
Parliamentary approval for the payments under this new scheme will be sought in a Supplementary Estimate. Pending that approval, urgent expenditure up to £25 million will be met by repayable advances from the contingencies fund.
The payments will be made by my Department through a new central unit, in order to provide the quickest and most efficient response to cases. Clearly it will be some weeks before such a unit can be properly operational, but I can give the House an assurance that the transitional arrangements will deal with the relevant losses to the vulnerable groups which have occurred since 1 April. That includes people with capital of less than £8,000 who have been affected by the £6,000 limit which has been in operation since 1 April. In other words, any payments will be backdated to 1 April.
This proposal meets the concern which has been emerging at constituency surgeries. These transitional arrangements are announced and the money will be for—[Interruption.]—the year in question and, obviously, it 361 will be kept under continuing review. [Interruption.] It will be kept under continuing review, because people's circumstances change.
This proposal meets the concern which has been emerging at constituency surgeries. It is that, despite the substantial improvement in the structure of housing benefit, the change for people who are used to a particular level of help is too abrupt; and that we must act to stop losses which for some represent too high a proportion of their total income. I am confident that we have found the means to tackle that effectively.
The social security reforms which came into effect a few weeks ago have created a fairer, simpler and better targeted system than anything seen previously. Overall, the majority of claimants will be better off or will get the same as before. I have announced today an increase in the capital limit, a relaxation of the rules covering the disposal of properties and, most important, a scheme of transitional help for those who have faced large losses.
The effect of the package of measures will add a further £100 million to the largest ever social security budget. Nothing could better show this Government's commitment to those who need to look to us for help. Because of our extremely successful management of the economy we have been able to respond to the tune of £48 billion a year. I commend the amendment to the House.
§ Mr. James Lamond (Oldham, Central and Royton)
I have just heard one of the most remarkable speeches in my 18 years in this House. It is rather sad to see a Secretary of State signing his own death warrant. I do not think that he can last very much longer, even after the concessions which have been wrung from him and the Cabinet in the past few days.
It surprised me to hear the Secretary of State set the new capital limit at £8,000 without mentioning the £3,000 bottom limit which has already been drawn to his attention. The effect on those whom he was trying to help will nevertheless be severe. He tried to say that many more people have benefited than have suffered from these changes. That is hard to understand, because I have received many letters from my constituents, as have many other hon. Members. [Interruption.]
§ Mr. Speaker
Order. There is a great deal of conversation on both sides of the House. I ask for a fair hearing for the hon. Gentleman.
§ Mr. Lamond
Yes, I understand why conversations are going on: I am sure that Conservative Members are trying to work out the statement, as we are. It is rather unfortunate—this is a criticism that we can make of the procedures of the House—that the last people to receive any information about such a statement are those who are expected to debate it. Early in the Secretary of State's speech I observed copies of the changes being handed round the Press Gallery, so they have an advantage over us.
362 Many of my constituents have written to me who cannot bring themselves to believe that the changes will have the effect that they are having. They are angry with their local council because they think that it is responsible for the changes, and that elderly people and mothers who have had to go to hospital, a nursing home or a council home for the elderly are being told that they must sell their homes to finance the cost of staying in that old person's council flat. They do not understand that, and cannot bring themselves to believe it.
I wish to cite one instance from my constituency, because we cannot debate this matter on cold statistics. I know that Conservative Members would like to debate this on percentages and not individual cases, but it is of individual cases that we speak. The changes affect individual people, many of whom are the poorest in our society.
A male constituent works full time as a butcher. He has one son aged two and three daughters between six and 10. This case is authenticated by the chief executive of my local authority. That man's net earnings, working full time as a butcher in Oldham, are £79.02. Although this point does not directly affect what we are discussing today, I would like Conservative Members to take note of that man's wages. We have often heard those hon. Members speak of cutting wage levels, and say that people are pricing themselves out of jobs. If they tried to live on £79 per week take-home pay, with four children, they would have to curtail their lifestyles a little—and so would I.
In addition to the £79, that man has child benefit for his four children of £29, and family income supplement of £25.70. That is a total income of £133.72. Under the new scheme, his family income supplement is replaced by family credit. That amount is increased from £25 to £39. I suppose that he is counted as one of the 5 million or 6 million people who are considered to be gainers under the new system, as against the 1 million losers.
However, if we look at it a little further, instead of having a rent rebate of £22 against his rent of £34, which involves him paying a rent of £11.81, under the new scheme he does not receive any rebate at all. His rent is going up to £37.23, and the cash available to spend on himself, his wife and four children is reduced from £122 to £110. He is £12 a week worse off. In addition, he has lost his three daughters' entitlement to free school meals, which amounts to £9.75 a week. His total available income is now £100.04.
I ask Conservative Members to place themselves in the circumstances of that family. That is my only reason for intervening in the debate. If the Minister is saying that he will not allow rent rebates to be reduced so drastically, I will welcome that alleviating action. However, I am concerned if he sets a time limit, because that family will. not be able to improve their circumstances so as to make up the loss of £20 from an income of £120. That man and his wife are very worried by that loss of £20.
I know that many Conservative Members are reasonable people, and I cannot understand how they sleep at night. When people such as this man come to my constituency surgery, weeping about what is happening to them—ordinary decent people, trying to maintain a home and look after a family, working hard but having nothing to spare for holidays or anything of that kind—I find it difficult to sleep at night, and I would if I were a Conservative Member. Whether Conservative Members like it or not, and whether they table clauses saying that 363 they do not agree with such moves, they are responsible because they support such moves in the Lobby with their votes, so I cannot understand how they can go home and sleep soundly in their beds.
§ Sir Giles Shaw (Pudsey)
I am not prepared to follow the hon. Member for Oldham, Central and Royton (Mr. Lamond), although he speaks with great conscience on this matter, in seeking to make such an attack on the position of my right hon. Friend the Secretary of State in this debate. As the first Conservative Member to be called, I must tell my right hon. Friend how appreciative I am of the changes he has made. I will not use the word "thanks" to my right hon. Friend, because this is not an occasion for that word. What we have received from my right hon. Friend is more than that. We have had a rapid and sensitive appreciation that, at least in the housing benefit provisions, anomalies have occurred—I do not want to use the word "anomalies" again—which need some rapid changes.
Two things flow from that. First, I believe that my right hon. Friend and his hon. Friend the Minister for Social Security and the Disabled respond to the pressures that are put upon them by members of the public, by members of our party and, no doubt, by Opposition Members. That responsiveness is a welcome sign.
Secondly, my right hon. Friend has rightly shown the capacity to exert political judgment, when faced with a difficult situation. That is not to say that my right hon. Friend has embarked upon a course in which we shall not support him. Of course we will. Indeed, we fought the election on the reform of many of the structures which have been in place in the social fabric of this land for over 40 years. That is what the electorate expected this Government to do, and that is what we expect my right hon. Friend to do in handling the major issues of social security, which he has only inherited in recent months.
I advise my right hon. Friend that there will be others among his colleagues in the Cabinet—I refer to his right hon. Friend the Secretary of State for the Environment—who would do well to look at the way in which my right hon. Friend has responded to what happens when implementing major changes. I trust that my right hon. Friend recognises that this is not a matter for U-turns, grovelling or anxiety, or even for being particularly outrageous in turning the existing policy. However, the art of the possible and the art of the practicable are two of the essential ingredients of a successful Government. I congratulate my right hon. Friend on what he has done, although there are two other points which I wish to make.
First, while recognising in the case of housing benefits that the anomalies created were both active in their expression and urgent, that could also be the way in which many other aspects of the major changes that my right hon. Friend has introduced will ultimately give witness. I am a little worried that, in seeking to respond to this and to the other changes announced today, as he has done, he may give the impression that, wherever the shoe happens to pinch, there will be an immediate response.
In the debate three weeks ago, I urged my right hon. Friend to monitor the implementation of the changes. I said that if the Government failed in their commitment to ensure that the majority of people in need will benefit from those changes, my right hon. Friend should amend the 364 necessary regulations. What he should not consider tonight is seeking to offer a panic result to substantial and sudden pressure.
The social security benefit changes represent a watershed in social policy, to which this Government are committed and which are endorsed by the electorate, alongside the changes in education and local authority financing. The changes are a fundamental shift in policy. There will be difficulties, and we as Conservative Members of Parliament will have to bear the brunt. I believe that we can do that in the knowledge that there are occasions when it is right to make changes. This is one such occasion. There may be others in due course. Our task is to support the principle upon which we were elected. I am glad to support my right hon. Friend.
§ Mr. Charles Kennedy (Ross, Cromarty and Skye)
In having to deliver his speech this afternoon the Secretary of State does, in one sense, deserve sympathy from all quarters of the House. As his hon. Friend the Member for Pudsey (Sir G. Shaw) has just said, if political sense prevailed within the Government, this was bound to be an occasion when decisions would be taken which would offer some concessions to Tory Back Benchers in order to try to quell the revolt. It must have been galling to read in the press at the weekend that even allowing for the fact that the Secretary of State would be making a speech that would provide some relief—if not sheer relief—for his Back Benchers he was still having to fight a battle to make the speech in the first place. That does not say much for the support that he has from the closest quarters within the Government. I am glad to see at least one Conservative Back Bencher nodding in acquiescence of that view. However, I shall not name him.
I return to the opening of the debate, when we were reminded by both the Labour spokesman, the hon. Member for Livingston (Mr. Cook), and the Secretary of State of the purpose of the social security reviews when they were first set up, with public hearings and so on. One of the principal objectives for which this Government and the previous Administration were aiming was simplification. Following the further rehash that has been announced this afternoon, welcome though aspects of it are, there can be no doubt that the Government are steadily retreating further and further from the simplification that they claim is one of the most welcome hallmarks of the system. They are doing so—
§ Mr. Kennedy
The Secretary of State is disagreeing with me. He should go to the nearest social security office and ask the staff there, who have to cope with what has already been pushed through, how with declining staff resources they will cope with the further changes that have been announced, some of which have been backdated to the beginning of this month, when the original changes were implemented.
The consistent simplification that the Government have always claimed has been departed from, and correctly so, given the changes and the policies that they were going to implement until their Back-Bench revolts of the past few days and weeks.
§ Mr. Kennedy
I shall give way to my hon. Friend in a moment.
The Secretary of State should be under no illusions. He is departing from that principle. I happily give way to my hon. Friend.
§ Mr. Beith
I thank my hon. Friend for giving way. Is he aware that one change that the staff are having the greatest difficulty in explaining in this now complex situation is that a miner's widow who receives concessionary coal does not have that counted against housing benefit, but a miner's widow who, because her house has been converted by the council to central heating, gets cash in lieu of concessionary coal, has that amount counted against her benefit and it is reduced? My hon. Friend recognises the problems of the staff, but can he imagine trying to explain that to a miner's widow?
§ Mr. Kennedy
The Secretary of State referred to regulations. The argument that I have just made is that social security officers, who, as the Secretary of State is aware—after all, amongst other things, he is the Secretary of State for Social Services—are having to carry through the bulk of most the social security changes will, like the local government system, have to react to some of the changes that he has announced this afternoon.
The example that my hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) gave was excellent, though sad, but it again reveals that this great, sweeping simplification has given rise to further crazy anomalies which are thwarting the very purpose of the Government's plans.
§ Mr. Mallon
I thank the hon. Gentleman for giving way. As the North of Ireland has to endure these terrible housing benefit regulations, it is only right that the Secretary of State should be accurate. Housing benefit is not administered by local authorities in the North of Ireland. It is administered by a different agency.
In relation to what the hon. Member for Ross, Cromarty and Skye (Mr. Kennedy) has been saying, one problem about the legislation is that those who understand it cannot explain it, and those who can explain it do not understand it.
§ Mr. Kennedy
I am not sure that that point is as much for me as it is for the Secretary of State, but I am grateful to the hon. Gentleman for making it.
I now deal with the specific areas with which the Secretary of State dealt. First, on the question of capital disregard, which has caused so much difficulty and so much revolt on the Conservative Back Benches and in other quarters of the House, I refer to the position that 366 prevailed when the hon. Member for Hornsey and Wood Green (Sir H. Rossi) served at the DHSS. I do not think that the hon. Gentleman is in his place at the moment, although he was here for the Secretary of State's speech.
When at the DHSS, the hon. Gentleman considered the alternative of notional interest, which, in a sense, has now almost been conceded by the transitional arrangements which the Secretary of State announced today, in preference to an absolute cut-off point for capital disregard. Notional interest is the assumed interest that could be earned from any capital owned by a benefit recipient.
I endorse what the hon. Member for Brighton Kemptown (Mr. Bowden) said in an intervention during the Secretary of State's speech, when he referred to the continuing concern over tariff income and the £3,000 level. Given that, prior to this afternoon, above £6,000 there would have been a total loss of housing benefit, surely the DHSS would have done better to stick to the scheme or regime that was preferred by one of its previous Ministers.
In a recent interview in The Guardian the hon. Member for Hornsey and Wood Green recalled that, when he was a Minister examining this matter,DHSS civil servants put forward two alternatives. One was a simplification along the lines of supplementary benefit, with a cut-off for claimants whose savings reached £3,000. The other involved deducting only the notional interest from savings when benefit was paid.The article then said that the hon. Gentleman hadexamined Treasury costings and found no difference in implementing either scheme.The hon. Gentleman was reported as sayingCivil servants were determined to introduce the first alternative because it was much easier to administer, and I had to fight them all the way.It is much easier for an official just to cut off the benefit once savings reach such a figure than to work out the interest on savings and then deduct it from housing benefit payable.If that was the experience of someone who until fairly recently was a Minister at the DHSS, one can only wonder why, when the matter was re-examined by the present incumbents prior to the full implementation of the social security and housing benefit changes, Ministers chose to go down the path that they did with regard to the cut-off point for capital disregard, which, in turn, has led them into this afternoon's partial retreat, with all the resultant administrative considerations.
The second point with which I wish to deal is the disposal of capital income, or assumed capital income, and the fact that discretion will be given to local officers, or adjudicating officers, to waive the rules, as presently constituted, in exceptional circumstances. It is extremely welcome that the Secretary of State has bowed to the understanding that there should be a degree of local and regional flexibility. However, in recognising the correctness and the acceptability of that approach, it is somewhat puzzling why he does not recognise the need for flexibility in the third aspect of the changes that he announced this afternoon—those relating to housing benefit itself.
Even given the assurance—if it can be called that; after all, it is a transitional assurance—about what would happen if someone lost over £2.50 per week as a result of the overnight change in the housing benefit regime in the four categories that the Minister outlined in his speech, we should not be to sanguine about what the Government are doing. It is a transitional arrangement to achieve what was understood to be the Government's objective before the Secretary of State got to his feet this afternoon. It is a 367 transitional arrangement that may head off a partial revolt in his party—which may have been anticipated—but it will not deflect the Government from their pursual of the policy that has caused so much anguish and anxiety among hon. Members of all parties.
For housing benefit, it would surely have been better to announce a much higher earnings disregard and a lower marginal tax rate—the 65 per cent. taper—at the beginning, than to have a transitional scheme of this sort now. I appreciate that there was movement in that direction in the Minister's speech today, but surely it would have been better to do as I have suggested, both in the conception and in the delivery.
The disabled and the severely disabled stood to lose much as a result of the social security changes. The disabled premium has to an extent been an over-simplification in response to the myriad single payments and different benefits for which a severely disabled person could qualify. Now, however, by going too far in the opposite direction, the Government have left great anomalies.
The Minister singled out the disabled as one of the four categories, and the emphasis that he put on helping them was welcome, but the Government must concede that if their concern and convictions were as strong as they claim in this area of social policy they would have been slightly more anxious to implement fully many of the changes heralded by the passage of the Disabled Persons' Rights Act 1987 than they have been. From the Report stage of that Bill and from social services questions it has become all too clear that changes in line with the provisions of that legislation have been the result of haranguing by Opposition Members rather than of genuine progress initiated by the Government. The changes on disability in today's announcement must be seen in that context.
Finally, the Minister was at pains to talk about the need to encourage greater incentives by the changes to social security. Single parents are among those who will suffer most from those changes, even after today's announcement, and they will suffer because of the incentives with which the Secretary of State was concerned. Before the changes of 11 April, single parents were assessed as a couple for the purposes of housing benefit. I accept that there is now an additional premium of just over £8, but the 65 per cent. taper for withdrawal will leave many single parents signficantly worse off in low-paid employment than they were on state benefit.
Even after the alterations to the scheme, that was not the original intention or objective of the Government. So when the Secretary of State assesses the effects of the transitional provisions that he has made today I hope that he will pay particular attention to single parents, whom he highlighted in his speech and who have suffered so much as a result of the initial changes. I suspect that they will continue to suffer, even allowing for the transitional provisions.
In conclusion, we should not allow the concessions—
§ Mr. Kennedy
I am glad that the hon. Gentleman is so obviously hanging on my every word.
The concessions at the margins that these changes bring about should not allow us to obscure what is happening at the heart of the tax and benefit policy of the Government. 368 This policy has been clear from the trio of debates that we have had this week. On Monday we discussed the poll tax, which will hit some of the poorest because of its flat-rate system. On Tuesday we debated the tax-cut provisions, which give the most to some of the most affluent people in society. Today, we have heard of a welcome change in housing benefit which arose because the poorest would have suffered from the alteration in Government policy that was implemented from the beginning of April.
Taking those three components together, it is clear that the rich are still benefiting most and the poor are receiving something only because of extreme pressure from both sides of the House. That is not a moral pursuit of policy, and it will not command our support in the Division Lobby tonight.
§ Mr. Andrew Bowden (Brighton, Kemptown)
During the debate on the Social Services Green Paper in 1985, I urged the Government to consider the implications of the proposed housing benefit changes, saying that I could not believe that the Government really intended to penalise 4 million pensioners.
In the context of the motion before us the House should look back briefly at what has happened to housing benefit since April 1983, when changes were made which meant that 1,150,000 pensioners suffered losses and 120,000 lost all housing benefit. In November 1984, 1,200,000 pensioners lost further entitlement and another 210,000 lost all housing benefit. In November 1985, a further 1,470,000 pensioners lost benefit and an additional 270,000 lost all entitlement. In April 1987, 2,600,000 pensioners lost some housing benefit entitlement, with a further 60,000 losing all entitlement. In April 1988, about 2,570,000 pensioners lost some entitlement and 750,000 lost all their entitlement to housing benefit.
§ Mr. Henry Bellingham (Norfolk, North-West)
My hon. Friend must be aware that in 1978 the Government were spending £1.24 billion on housing benefit. By 1987–88 that figure had risen to £5.2 billion—a colossal sum. Should that figure have been bigger?
§ Mr. Bowden
If my hon. Friend will listen to my arguments, I am sure that he will fully understand the position.
My hon. Friends and the Government sometimes pose a basic question: why should taxpayers' money be used when people have what some would describe as substantial savings? On the face of it, that is a convincing point, but let us consider the position again.
The generation of pensioners that I am discussing is the wartime generation, which made tremendous sacrifices and suffered great hardship. Those pensioners proved themselves to be one of the great exceptional generations in the history of the British nation. They were a generation that in most cases had little or no opportunity to buy property, and every pound that they saved represented a real struggle, a struggle that today's younger generation cannot contemplate or understand.
The House will be aware that, as each general election goes by, more and more younger Members join the House and fewer and fewer older Members remain. Therefore, fewer Members remember world war 2, lived through it, and faced the sacrifices that went with it. Therefore, what 369 that earlier generation suffered—the loss of life and the number of war widows—is no longer fully appreciated by the House.
That wartime generation, unlike almost any other, prepared for its retirement. What happened to those who scrimped and saved and gave up holidays, smoking and drinking to manage to save a little? Those people retired in the 1960s and early 1970s and, although they would not be rich, they believed that they would live in an era of relative peace and prosperity. In the 1970s and early 1980s, however, they found the value of their savings totally destroyed, largely as a result of Labour Government policies. I for one will never forgive them. At the time of those policies we declared that we recognised the problems faced by those people and that we intended that housing benefit should be some small compensation for the total destruction in the value of their savings.
Let us link those savings to the employment pensions that some, by no means all, of that generation had. In the 1960s and early 1970s the majority of people in that category retired on a non-inflation-proof employer's pension. The House will be aware that, when we compare the value of a 1960s and early 1970s pension with the pension today, it is virtually worthless. For that reason the circumstances of that generation are different from any other generation. That is why it is totally justified to use taxpayers' money to give some compensation to that group who, through no fault of their own, now find themselves on the financial breadline.
On many occasions we also said—how often have I listened to the speeches of my right hon. and hon. Friends, especially when we were the Opposition—that we should give help to those with just a little bit above the state minimum. Sadly, we are not doing that to the extent that we should. The wartime generation saved. It was responsible and thrifty, but now it has been penalised.
I have the greatest respect for my hon. Friend the Minister for Social Security and the Disabled. On 23 March he sent me a letter in which he said:The April changes are not cuts.I wish he would tell that to the thousands of pensioners in my constituency. I wish he would tell that to the war widow who has £6,200 in savings and, as a result of the recent announcements, has lost £15 per week.
Let us consider the announcement that was made today by my right hon. Friend the Secretary of State. I hope that I have got it clear, but it is difficult for us to absorb the exact details and implications. If I have got it wrong, I know that my hon. Friend the Minister will correct me immediately. As I understand it, the announcement means that the maximum limit for capital will go up to £8,000. It will still mean, however, that if a person has £8,100—there will be many pensioners on the basic pension who have no other income or savings apart from that sum—he will lose benefit in excess of £10 per week. If people have savings of £7,900 we have a guarantee, as I understand it, that they will not lose more than £2.50 per week for one year. What will happen at the end of that year?
The Government must do a lot of hard thinking and there must be more revisions and changes. I must tell the Government and all my colleagues that this problem will not go away. Until all the British people believe that justice 370 has been done, we will, quite rightly, be showered with letters and cases will appear at our advice surgeries in ever-increasing numbers.
Let us consider further the implications of today's announcement. I have some rough figures on the information given that may not be exactly accurate, and I ask the indulgence of the House and the Minister. As I understand it, it is still true that a pensioner aged 65 with nothing other than the state pension and an occupational pension of £10 per week, together with savings of £8,100, will still lose £12 a week housing benefit. In other words, his entire occupational pension is wiped out and is of no use to him.
There are many changes still to be made. I congratulate the Government on the start that they have made and I give full credit where it is due. The Government must, however, do a lot more thinking regarding the implications of the recent changes.
I welcome this major step in the right direction, but I must tell my hon. Friend the Minister that my original intention was to go into the Opposition Lobby, as I have done in the past. In view of what the Secretary of State has said, I hope only to abstain. I shall listen extremely carefully when my hon. Friend replies because I need some positive hope not just for one year, but for the future. We must ensure that we do not continue to neglect the pensioners.
§ Mr. Frank Field (Birkenhead)
It is a pleasure, as always, to follow the hon. Member for Brighton, Kemptown (Mr. Bowden). During his speech I was reminded of a debate on procedural changes in the House, which was introduced by R. A. Butler. On that occasion he said that the Government would find it impossible in the House of Commons were it not for the thick Tory squires behind him. He then gently turned round to smile at them. One can understand why Mr. Butler did not become leader of the Tory party.
§ Mr. Field
They have gone as well.
If the Government had 100 Members like the hon. Member for Kemptown, they would be in much greater difficulties than they have been in the past few days.
It is a convention of the House that if one intends to attack an hon. Member, one gives him notice. Therefore, I am sorry that the Secretary of State is no longer present, although I note that a message is now being sent out to get him. I shall speak extremely slowly until he arrives. I hope that it will not damage his future career if I say that today I thought he gave his best performance since becoming Secretary of State for Social Services. He can draw a moral from his performance: that, when defending the social security reforms, he goes down better with his Back Benchers if he comes to the House with a few hundred million pounds in his pocket. Perhaps in the next few weeks we shall see even better performances from him.
The difficulty that we face is that many of us had prepared contributions, but, having heard the Secretary of State, we are confused as to what he announced. Therefore, I suppose that we must also congratulate him on another score. So that we shall not continue to be 371 confused, the basis of my contribution will be some questions to the Minister. I shall be happy to give way as I go through so that we can be clear about the changes.
We are told that no one will be worse off by more than £2.50 a week. Does that include the 20 per cent. rates payment, or is that separate?
§ The Minister for Social Security and the Disabled (Mr. Nicholas Scott)
§ Mr. Field
It is separate. That is one point that has been clarified. Later, perhaps the Minister can tell us why they hit on £2.50 a week.
That ties in with another question: what would have been the cost if full transitional protection had been offered to those in receipt of housing benefit? The group about which I wrote to the Prime Minister was covered by housing benefit supplement. That tells us something about the Government's guarantees on transitional arrangements. Prior to housing benefit we had a system of locally run housing rent rebates and allowances and a rate rebate scheme.
The Government brought in a new scheme. Under the old scheme, people qualified for supplementary benefit if their income was below the scale rate, plus their housing costs. Under the housing benefit scheme, the housing cost was transferred to the new scheme. Because state pensions were a few shillings above the level for supplementary benefit, many pensioners were floated off supplementary benefit but gained little or no help from housing benefit. Therefore, they were substantially worse off and were many pounds below the supplementary benefit poverty line.
In order to protect that group, the Government introduced housing benefit supplement. However, that was abolished a week before the new scheme came into existence. Until then all changes in housing benefit supplement had been made by the affirmative resolution procedure in the House. The week before the new scheme came into being, changes in housing benefit supplement were made by negative resolution. In other words, we did not have to debate them. The effect of the change was that people's incomes fell drastically in the first week but they did not qualify for benefit under the transitional arrangements because they were already regarded as having a lower level of income. Can the Minister of State tell us whether all those who previously received housing benefit supplement will be protected after they have made the first £2.50 additional rent payment?
What did the Secretary of State mean when he said that transitional arrangements will be kept under constant review? When challenged, he said that people's circumstances change. We know that. As their income rose, they would automatically be floated off the transitional protection. That would not alter the structure of transitional protection. We want to know whether the Government intend to buy votes tonight by giving transitional protection for a year. Will transitional protection remain until no one qualifies for it because increases in pensions and other benefits will have taken everyone beyond the qualifying levels for the amount of support that was announced by the Secretary of State earlier?
Those are questions to which we desperately need answers if we are to make sense of the debate as it progresses. Conservative Members do not like to hear the 372 case being put so bluntly, but we must pay them a compliment for the changes which are being brought about by the Government. The last few hundred years of English history show that one of the greatest struggles has been by the poor trying to get money from the rich. Since 1979 we have seen an attack by the rich on the poor. Conservative Members do not like it. We see cuts in the income of people who are on income support—
§ Mr. Irvine Patnick (Sheffield, Hallam)
Can the hon. Gentleman assist me? How does one define the rich, the poor, and wealth?
§ Mr. Field
I advise the hon. Gentleman, if he has not done so already, to have a word with his right hon. Friend the Chancellor of the Exchequer, who knows exactly who is rich and exactly who is poor because he has been cutting the level of income of many poor people.
Over the past few weeks, we have been debating cuts not in the rate of increase in benefit but in rates of benefit. Despite the effect of today's statement, many of our constituents will suffer a cut in benefit each week of at least £2.50, plus a 20 per cent. rate payment, plus, for some, the loss of any increase in benefit because they were protected by the transitional arrangements. That is what I mean by the fundamental change that the Government have brought about. We must take back the message to the country so that people understand more clearly next time they vote than they did last time.
§ 5.5 pm
§ Mr. John Redwood (Wokingham)
The review of social security rightly began by asking the fundamental question, where does poverty lie? In a period when pensioners enjoy occupational pensions and often own their own houses, the inquiry discovered that poverty is now concentrated largely on low-income families, on single-parent family groups and on the disabled, and that whereas 20 years ago pensioners retired just on the state pension and needed widespread recourse to additional benefits, they are no longer, on average, in the same predicament. It was important that the review, when implemented as a new benefit system, should recognise that fact. The new system rightly gave most of the increased resources to those most in need. That I welcome, and substantial amounts were put on the table with that in mind.
The second important point was that the implementation of the review should take place against the background of spreading economic prosperity so that money was available to provide additional resources for the benefit system. How much I welcome the fact that our economic success means that in this year there will be £2,000 million extra going into welfare and almost £2,000 million extra going into health. So almost 3p of income tax has been allocated to increases in welfare payments. I compliment the Secretary of State and his ministerial colleagues on obtaining those resources while the Chancellor was still able to reduce tax rates across the board, particularly to help those on lower incomes out of the tax and benefit trap.
§ Mr. John Battle (Leeds, West)
Will the hon. Gentleman comment on the fact that 3.5 million people do not earn sufficient to pay income tax in the first place, even under the Chancellor's Budget? They will not benefit at all. Will he also comment on the fact that, as a precondition 373 of the introduction of the poll tax, everyone on housing benefit has to pay a 20 per cent. rates contribution, which means that everyone will suffer a 20 per cent. cut in housing benefit?
§ Mr. Redwood
The hon. Gentleman forgets that all those on income support are compensated for the 20 per cent. of the rates they pay. He also forgets that the reason why some of those people are no longer in the tax net is that the Government have taken almost 2 million lower paid people out of taxation altogether and made a substantial improvement in their lifestyle because they no longer have to pay that tax.
What we have seen this afternoon and will see in the rest of the debate is an Opposition in complete confusion. They came here with speeches designed to attack small elements of the scheme which has rightly been amended by my right hon. Friend the Secretary of State. Those prepared speeches are vacuous and unnecessary, because the necessary fine tuning has been accomplished. We also find that Opposition Members are forced into defending every element of the old system.
§ Mrs. Beckett
If the hon. Gentleman wishes to refer to vacuous and empty speeches, he should read his own words of a couple of weeks ago, when he denounced the Opposition for being so stupid as to call for changes in the regulations.
§ Mr. Redwood
It was my right hon. and hon. Friends who drew attention to some provisions that needed amending. I welcome their interventions and am delighted by my right hon Friend's response. The Opposition are now in the position of having to defend every element of the old system, knowing that, in practice, it was rotten. Have they forgotten the fact that, if claimants' circumstances changed, they had to apply week after week to establish whether they qualified for special individual payments? Did the Opposition like the system under which, if people were poor, they had to go to the benefits office and reveal many details time after time if they wanted one extra item that was beyond their budget?
Is it not much better that premiums should be built into benefit rates once and for all, so that, once people qualify, they may enjoy additional income without means testing? Do the Opposition wish to return to the means testers' charter which was the special payments system? Do they wish to return also to the situation that was common in the mid-1970s, when 200,000 people lived in families having to face marginal tax and benefit withdrawal rates of more than 100 per cent and who, if they worked, were worse off by the extent to which they derived an income from that work? It was a crazy arrangement, and I welcome the system of family credit, which means that everyone in the family unit who wishes to return to work, now that jobs are more widely available, is not confronted by a tax and benefit withdrawal rate of more than 100 per cent., which is the economics of the madhouse.
Do Opposition Members want a return to the situation of 1975 and 1976 when, under a Labour Government, they were compelled frantically and frenetically to ask questions of the then Chancellor of the Exchequer and the Secretary of State for Social Services about which benefit might be cut next, whether the Christmas bonus to pensioners would be withdrawn, and whether the real 374 value of incomes and savings risked erosion by the massively high rate of inflation? They had to ask also whether the value of benefits would wither away because inflation was then so high. The present Government uprate benefits in line with prices and keep inflation under control, so that people who have made provision for their future, and who have retirement savings, will enjoy the benefits of them.
The Opposition record on social services and welfare was atrocious. It was a story of cuts, and of a Chancellor of the Exchequer who boasted in the House that £1,000 million had been cut from the budgets because the IMF had forced him to do so; proudly claiming that there had been real cuts across the board in public spending. Not only do the present Government not make overall real cuts in public spending, but, because of the successful economy and their prudence in so many other areas, they manage to provide growing real resources for health and welfare—[Interruption.]
How much Opposition Members dislike the truth can be gauged by the level of their barracking when one tries to point out their record, which was so mean on the poor. Why is it that we have been compelled to increase benefits to the disabled by 80 per cent. in real terms? It was because the benefits of the mid-1970s were so mean that they were an affront to both Opposition and Government Members. The Opposition would probably find it impossible to rise in defence of the real levels of disablement benefit that existed in the mid-1970s, and they would condemn the Government if all they had done was preserve those real levels and not allow the disabled to benefit from the country's growing prosperity.
I am delighted to support a system which means that no longer will 400,000 families have to face the impossible task of working their way through the complex system to secure the benefits to which they are entitled. I am delighted to defend a system that provides people with an incentive to work, to provide for themselves, and to defend an economic policy that has delivered a 21.5 per cent. improvement in real living standards and incomes for those on half average earnings. That is true welfare policy in an economy that works; an economy that produces the goods and which rewards people across the scale.
In a recent poll, people asked about Labour party policy said that they did not deny that the Opposition would like to see benefits increased, but did not believe that Labour would ever be able to deliver the goods and to afford the benefit increases that they wanted to see. This Government not only want to see benefits increasing for those in most need, but they produced those benefits. They are a Government who deliver the goods and who have increased the prosperity of all the people.
§ Mr. Thomas McAvoy (Glasgow, Rutherglen)
I shall be brief because I know that many of my right hon. and hon. Friends wish to contribute to the debate. I associate myself with most, if not all, of the remarks made by the hon. Member for Brighton, Kemptown (Mr. Bowden). He is a proven fighter on behalf of pensioners, and I pay tribute to him.
Every Member of Parliament has a right and a duty to bring to the House the benefits of his or her constituency experiences. Their sum total must contribute to the overall breadth of knowledge on which the House draws when 375 debating and passing legislation. Unfortunately, today we are discussing the effects of a fait accompli—the new social security legislation which has caused such misery and suffering since 11 April.
Before coming to the House, I was a councillor in my constituency and, before that, chairman of my local community council and tenants' association. Therefore, I have been involved in public life for more than 10 years, but I have never known such desperation as that seen since 11 April. I have received reports from housing offices within my constituency which have witnessed the most distressing scenes as senior citizens have broken down in tears when informed of cuts in their housing benefit.
If any section of the community deserves our support, it is the present generation of senior citizens. They came through depressions, fought and won for us the second world war, rebuilt the country after that war, and played a major role in its economic recovery.
I remind the Government also that, along with us, they encouraged that generation to provide for the future and to be thrifty. We are seeing that same generation now being penalised by the Government for their thriftiness and sense of responsibility. The changes in housing benefit are causing hardship, with 0.75 million pensioners losing all entitlement, while another 2.5 million will have their housing benefit reduced. If the changes announced today will help in that situation, they will be welcome—but I submit that they will give too little, too late.
I make no apology for citing the specific case of an elderly couple in the Castlemilk part of my constituency. They are both 73 years of age and the husband has a works pension amounting to £33 weekly for industrial deafness. Before the changes, the couple paid rent and rates of £5.69 per month. Now they hve to pay £98 per month, with no increase in their income; they must find from somewhere an extra £90 a month. The main reason for that change would seem be that the husband's works pension is now included in the calculation, whereas before it was regarded as compensation for a medical condition. Perhaps that is the worst example I have encountered, but there are many others where housing benefit cuts have resulted in a dramatic decrease in senior citizens' total weekly income.
I do not believe that the Government Benches are full of evil men; many of them have a social conscience, in the tradition of one-nation Tories. I appeal to those Conservative Members who do not like what is happening to join us in the Lobby tonight. That way, the Government will realise that they cannot continue along the path of social injustice. It would be easy for us on these Benches to fall into the trap of allowing the Government to commit electoral suicide, as the right hon. Member for Henley (Mr. Heseltine) said, but we must try to change their approach by vigorous opposition. We look for further changes and moves towards helping senior citizens and other sections of the community, and I ask all fair-minded Conservative Members to join us in the Lobby tonight.
§ Mr. Phillip Oppenheim (Amber Valley)
Many of us, while canvassing in our constituencies at election time—or, indeed, in our surgeries—have been faced with people complaining bitterly that they are unable to claim benefit of one sort or another because they are just on the wrong side of the threshold. Those same people are often able to point out others who live in the same road, or whom they 376 have known all their lives, who can claim benefit. They sometimes complain that those who have been profligate can claim benefit although they, who have been thrifty, cannot. To explain that position is one of the hardest tasks that a Member of Parliament can face.
The current reforms improve the position relating to income support. The threshold has been raised from £3,000 to £6,000, and Opposition Members should recognise that the people concerned are now better off. When it comes to housing benefit, however, there is no getting away from the fact that the position is substantially worse. I believe that we must make a fundamental choice. We can accept a system in which there is a cut-off point, wherever that cut-off point may be. Such a system will leave more resources for the really badly off, such as the disabled and families on low incomes, who have gained from the reforms.
The alternative, proposed by the Opposition in the Standing Committee, is universal benefit, much of which would go indiscriminately to the better-off. The corollary would be many people paying taxes on the one hand, and receiving money back inefficiently in benefits on the other. The losers would be the really needy.
I believe that it is far better to have a targeted system. If we believe in such a system, we must accept a threshold, with all the inequity that it implies. The original £6,000 capital limit may have been too low, and it is possible that the proposed £8,000 limit is also too low. We must recognise, however, that wherever the level had been set, we would have received exactly the same complaints from those on the wrong side of it. If the limit had originally been set at £10,000 or £15,000, we would have been told that a nest egg of £15,000, in this age of generous redundancy payments and lump sums, is not very much.
Before Opposition Members become carried away by their own self-righteousness, it is worth remembering that under the last Government, the threshold for the main benefits was below even the old £3,000 limit that obtained until these reforms. It is also a fact that many who are now on the wrong side of the new £8,000 limit are paying far less tax than they were before, far less than they paid under the Labour Government and, indeed, far less than they would pay under the system of universal benefits proposed in Committee by the Opposition.
Under the old system, many who were able to draw housing benefit—many, but not all—were relatively well off. It is worth remembering in particular that since 1979 pensioners' incomes have grown, on average, twice as fast as those of the general population, and four times as fast as they did in the 1970s. Those people have often gained from the success of industry and the City, through their pension funds and their investments—institutions that the Opposition despise, deride and oppose.
On the other hand, I believe that the Opposition and many other critics of the reforms have ignored one of their true weaknesses. Although some of the worst of the poverty earnings traps have been partially dealt with for those on very low incomes, the trap remains very severe for many single people on low incomes, discouraging them from taking jobs. Perhaps, rather than concentrating on the relatively well-off, we should have concentrated on the groups who are not so well off and have no savings at all.
It seems to me illogical for people on the one hand to say that they are saving so that they need not be dependent, and on the other hand to demand benefits, although they have some savings—not all of which they 377 would be required to use up before gaining benefit. While all the fuss has been going on about a sector of society that is relatively well off—I emphasise the word "relatively"—critics have often ignored the fact that groups such as the disabled and low-income families are often substantially better off as a result of the reforms. That salient fact seems to have passed beneath the notice of the pontificating prelates and the Pavlovian pundits who automatically salivate with sneers of "obscene", "offensive" and "a war on the poor", whatever the Government's policy, without even bothering to find out the truth of the matter.
The fact is that any realistic system of social security will contain injustices and inequities. The safety net will inevitably catch those who have fallen on hard times through no fault of their own, as well as those who are playing the system for all it is worth. It will also unavoidably miss out many who have been careful and thrifty, and who have savings. The Opposition are quite within their rights in trying to make partisan profit out of that, but our job on the Conservative Benches is to explain why the system has to be as it is, not to pretend that there is a simple, magic solution, or to add interest to the insults of our opponents.
§ Mr. Win Griffiths (Bridgend)
I am still amazed by the facility with which some Conservative Members can justify the way in which the simplification of the system has struck millions of people in Britain.
My constituency and that of my hon. Friend the Member for Ogmore (Mr. Powell) cover the borough council of Ogwr in south Wales. The council sent out 17,000 forms for the introduction of the new system. Three thousand people did not return them, probably because they saw immediately that they were no longer eligible for benefit—although, to be fair to the council, it is to circulate those people again to check whether that is the case.
Of the 14,000 who returned the forms, on the first day on which they received their new rent and rates assessments 1,400 people contacted the council to say that there must be some mistake. In the first week, 6,000 took that course. The officials in the council, working rapidly, effectively and efficiently, checked all 6,000 claims and found that the increases were, unfortunately, exactly as they had been assessed.
If the hon. Member for Wokingham (Mr. Redwood) thinks that this is just a criticism of small elements within the system, he must have both a small mind and a small heart to still think that when he hears of some of the effects of the system on individuals. I should like to mention four such cases this evening.
The first concerns a Mr. Williams, who lives in Bridgend. He is a pensioner, an ex-miner who suffers from silocosis and whose wife is an invalid. He fought in the Royal Navy during the second world war. He finds that, as a result of the Government's munificence and their simplification of the benefits system, he is £21.63 a week worse off, and he has to find the money out of a relatively small income.
In my village of Cefn Cribwr, a family receiving a disability benefit is £19 a week worse off. Down the road, in the village of Kenfig Mill, a disabled pensioner is £17 a 378 week worse off. A man receiving a special hardship allowance is now £14 a week worse off. In the borough, the worst case is of a family that is £25 a week worse off because of the new system.
If Conservative Members think that the simplification of the scheme is something to be lauded, they are mistaken, because over half the people in Ogwr borough council who were receiving housing benefit are now worse off as a result of the changes. The changes introduced today will mean that a few of them may be better off, but what is the promise for those who have been worst hit—those on disability pensions and benefits of one sort or another, and those who used to receive special hardship allowance but who have lost all that because of the loss of local authority discretion? We have been told that they will receive transitional help, but they will automatically be £2.50 worse off. They have lost that sum straight away.
Year by year, the situation will be reviewed. How will Mr. Williams, the pensioner in Bridgend, feel when he loses only £2.50 now, but with the prospect that next year, or the year after, he will suddenly have to lose the extra £20? It is not worth carrying on with such a reprieve. It would be far better if the Secretary of State had announced that, although the £2.50 will be taken, the Government will not take any more. Unfortunately, he did not make that promise.
What are we to say to people who are affected by the so-called tariff income rules? As far as I understood the announcement, nothing is to be done for them. They have savings of over £3,000 and they will be assessed on a fictitious rate of interest. Virtually no individual with savings of a few thousand pounds will be able to achieve that rate of interest, but benefit will still be based on it, and on a notional rate of income that is far above the real income that they will receive on the interest from their savings. Why could the Secretary of State not have announced that the real rate of interest will be used in assessing people for housing benefit? Why could he not announce that where people are saving to buy a car under the mobility allowance scheme, those savings will be excluded completely?
While some small but welcome reliefs have been announced, the simplification of the system has resulted in gross injustice for many millions of people. Unless the Secretary of State is prepared to recognise that and, for example, to make the taper far less steep, he will get more complaints and letters about individuals who are suffering and we shall have more opportunities to bring this matter on to the Floor of the House.
§ Dame Elaine Kellett-Bowman (Lancaster)
It was quite evident that the hon. Member for Glasgow, Rutherglen (Mr. McAvoy) had written his speech before the debate. He paid no attention to the substantial concessions and adjustments made by my right hon. Friend the Secretary of State. The hon. Member for Bridgend (Mr. Griffiths) paid minimal attention to them, but not much more. It was high time that we sorted out the appallingly complicated system of benefits that had grown up haphazardly over decades. By and large, the Government have done an exceedingly good job. Inevitably, with such far-reaching changes in a system that has set rigid over many years, rough edges occurred. It is the duty and the privilege of the Government to listen to the views of Members of 379 Parliament who are closely in touch with their constituents and can discover what those rough edges are and pass on that information.
I come from an area where wages have never been high, but my thrifty constituents have always saved a high proportion of their incomes for their old age and to preserve their independence. The £6,000 cut-off point for housing benefit was too low, and I am delighted that it is to be raised to £8,000, with the extra money that will be needed to meet this change coming from the contingency reserve, which exists for exactly such a purpose.
I also feel strongly that if an elderly person or a couple find that they can no longer cope at home and have to move into a residential home, they should be given ample time to sell their home before having their benefits cut. Houses do not sell as rapidly in my part of the world as they do in the south-east. This is particularly important to us, and the change announced today will be very welcome; it is proof that the Government do not merely listen to what we have to say, but act on what they find in practice to be cases of hardship. I am grateful to them for so doing.
§ Mr. David Blunkett (Sheffield, Brightside)
When we hear speeches such as that made by the hon. Member for Lancaster (Dame E. Kellett-Bowman), in which hon. Members say that they are near to their constituents; when we hear, as we have heard this afternoon, millionaires talking about what they understand by poverty, we are getting near the bone. When one represents an area where many people—not a few—are so desperately affected that the money taken from them prevents them from being able to buy food or to heat their homes, we know what poverty is about.
The problem with transitional help is that, by its very nature, it is transitional. It ebbs, and those who are now in a desperate plight and who will be helped by this afternoon's announcement will eventually face the same poverty and dilemmas at the end of the transitional period. We have been trying to relieve them of those problems through our debates and the pressure put on the Government over the past few weeks.
As the whole intention of these changes was to save £640 million, to transfer it to some of those who have spoken this afternoon and who have benefited so much from the tax reliefs for which Conservative Members voted, in the end those whom we represent will be the losers. This affects not only those who are on transitional arrangements, but those who face poverty and who are now coming into the system, and who will have to face the problems that we and the media highlighted to bring pressure to bear on the Government.
For these people, the problem will not go away. For example, in the city of Sheffield, one individual lost £24.70 a week. He will receive help now, but because it is transitional, it will run out and eventually he will lose the £24.70. There is also the example, of Lottie Green, a widow. Her husband deferred spending the money that they could have spent, to provide a little pension, and she will lose £11 a week. It will take longer for that loss to come into effect. The noose will be tightened gradually, but it will tighten, and that £11 will be lost.
Mr. and Mrs. Grant, who live in the constituency of my hon. Friend the Member for Sheffield, Heeley (Mr. Michie), will lose £14 a week. They will lose it more slowly. 380 People who are currently coming into the system will also lose. That is the reality of a situation that exists so that the Secretary of State for Social Services can eventually take hundreds of millions of pounds from the most needy in our community and pass it to the Treasury.
§ Mr. David Nicholson (Taunton)
Will the hon. Gentleman tell the House what mole or other informer he has in the Treasury or in the DHSS who informed him that what he prophesises will be the case? I know of no such expectation.
§ Mr. Blunkett
The information was given in the House by the Secretary of State for Social Services on 19 November last year and appears in Hansard. Those were the figures. A week last Monday, the Secretary of State for the Environment admitted to the House that so-called concessions on the poll tax rebate would be taken from housing benefit. This afternoon we have to ask, who in the system will be the losers and will have to pay for the concession that has just been announced?
Although we sympathise with those who have capital of more than £6,000, the capital sums are not the real issue. The real issue is that the difference in the tapering arrangements has hit so many widows and pensioners just above the income support level. Those people have scrimped and saved; they have done what the Government so often preach and then denounce when it is practised. Those people have scrimped and saved for their old age. They have put money aside and have taken part in the saving economy. Those people will lose. Those are the people on whose behalf we have spoken during the past few weeks and whom we shall continue to defend until the Government realise that at the next general election they will pay the price for their penny pinching.
§ Mr. John Greenway (Ryedale)
The debate brings to a head the issues that have overshadowed Parliament since the general election last year. They are the issues of how best to care for the least well off in our increasingly prosperous society, and which party has the best policies to ensure that that care is provided.
The Government's record stands comparison with that of any previous Administration. We are spending more money in real terms on benefits for more people than ever before. The Government have had the courage and the capacity to take 40 years history of a welfare benefits system dominated by a bureaucracy which few people understood and which became increasingly discredited because of its inability to provide for those most in need, and to transform it into one which is fairer, more easily understood, more responsive and more likely to ensure lull entitlement. It has provided increased benefits for more than 5 million of our most needy families, especially those with young children, and the disabled. That is what the social security reforms have achieved.
Far from being censured, the Government should be congratulated on their bold approach. My right hon. Friend the Secretary of State deserves congratulations too on his announcement today, which is most welcome. Some may feel that it does not go far enough, but no one can doubt that it represents an urgent and sensitive response to the unforeseen difficulties which have been highlighted in different ways by hon. Members from both sides of the House.
§ Mr. Greenway
No. Many hon. Members wish to speak in this debate. If the hon. Gentleman wants to make a point, he should wait to be called.
§ Mr. Greenway
No. I am not giving way.
Today's announcement also demonstrates that the clear undertaking given to the House by my hon. Friend the Minister for Social Security and the Disabled on 13 April —just two weeks ago—to monitor carefully the impact of the reforms has been fully honoured.
§ Mr. Greenway
I shall not give way. It would be unfair on hon. Members who wish to speak in the debate.
The real impact of recent events is clear. The Opposition have one policy—that is, to spend other people's money faster than the nation can ever hope to earn it. Day in, day out and week after week the House and the country are subjected to a nauseating catalogue of patronising promises which the Opposition and the nation know they will never be able to fulfil, in the increasingly unlikely event that they will ever get the chance to do so. I shudder to think what the cost to the country would be if all the promises that Opposition Members have made were honoured. Would they have been able to afford the modest increase announced today by my right hon. Friend? Their audacity in telling us how to spend the revenues and the wealth which their policies would destroy knows no bounds.
That despicable deception contrasts with the Government's proud achievements. In the past few weeks, 750,000 people on the lowest incomes have been taken out of tax. We have the lowest income tax rate for more than half a century. There has been the biggest ever increase in NHS budgets and £2 billion more has been spent on social security. We now have the highest ever social security budget. We are spending more on education, social services and fighting crime. Above all, a 15 per cent. pay rise for nurses has been fully funded by the Government without any cuts in other programmes.
Today's announcement that those at the margins who perhaps have lost out in a way which was not fully anticipated will be protected and is coupled with a further undertaking by the Secretary of State that the Government will continue to monitor the effects of these much needed reforms. No doubt that undertaking will be endorsed by the Minister of State.
Within a week there has been the biggest ever pay increase for nurses, more money for doctors and dentists and further concessions on social security benefits. All that shows that the Government have the compassion and the capacity to respond to the needs of society. People in this country trust us to do the right thing, and they know that their trust is well placed.
Perhaps the Government need to be nudged occasionally. I would say to Opposition Members that it is better to nudge the banker than to knock at the door of the bankrupt. I am not talking only about the money and the capacity to pay, but about the ideas and the radical approach of the Government and how that contrasts with the bankrupt ideas of the Opposition.
382 Those who doubt and have lingering concerns that the Government may have penalised too many, that more people than necessary may be losing benefit, should reflect that such concern and anxiety is clear evidence of the sea change in attitude towards Britain's prosperity in recent years. For too long people were willing to accept second best. How many times have we heard that it is all we can afford, that we have to tighten our belts? Even in the two or three years since the reforms were planned and announced, the growing evidence of increased prosperity has become more obvious. We must not shirk our responsibility to ensure that everyone in society shares in that prosperity. Despite my support for the Government tonight, I give my right hon. and hon. Friends notice that we must return to this matter in future because that is what the nation expects.
We must not be deflected from our objective of ensuring that the least well off, the sick and the disabled of the years ahead will be adequately supported and that, despite our increased wealth, we cannot afford the profligacy or recklessness that the Opposition would recommend. This motion stems not from the failure of this Government but from their success.
§ Mr. Seamus Mallon (Newry and Armagh)
I welcome the opportunity to make a few observations about the housing benefit changes. I come from a region with the highest rate of unemployment in western Europe, with the highest level of dependency of any region under the authority of this Government, and with the greatest degree of social and environmental deprivation to be found anywhere in these islands.
Against that background, I shall single out a few specific points. The first was referred to by the hon. Member for Ross, Cromarty and Skye (Mr. Kennedy). It relates to the crucial differences between the way in which housing benefit is administered in Northern Ireland and in the rest of the United Kingdom. I said earlier, somewhat facetiously, that one of the problems about the arrangements is that those who understand them cannot explain them, and that those who can explain them do not understand them. Those who work in the DHSS offices are under tremendous pressure. I take this opportunity to pay tribute to the DHSS personnel. They have had a very short period within which to cope with the arrangements provided for in this enormously complex legislation, and this has caused enormous problems.
Those of us who have tried to give advice and help to people know, first, how difficult it is to claim benefit; secondly, how difficult it is to process the claim; and, thirdly, how difficult it is properly to assess the claim. That is already having an effect, and it will continue to have a long-term effect on housing benefit.
A new category of poor person has been created in recent years, and this is adding considerably to the problems. I am referring to those who are obviously in need or who have not made the effort that they should have made to provide for themselves and their families. They include those who, throughout their lives, have 383 worked hard, saved hard and looked after their families, their careers and their homes. They are being knocked by the housing benefit arrangements.
I shall call them, because I believe it to be a proper and accurate term, the lace-curtain poor, those who, all of a sudden, find that, despite the efforts that they have made throughout their lives, they cannot cope—a position in which they never envisaged they would find themselves.
Some of those who fall into the category of the lace-curtain poor are the elderly—people who put their pennies together and saved for the day when they might need that money, but who, when that day came, discovered that they were governed by a Government who said that their need was greater than that of the people from whom they were taking the money by reducing their housing benefit.
I am not referring just to the elderly. Younger people want to take pride in themselves and their families. For that reason they have saved, but now they are paying for it. I give as an example those who have been awarded industrial injuries pensions because of damage done to their persons. They are now losing housing benefit. It is not right that those in receipt of a pension of that kind, because of injuries they have suffered, should lose their housing benefit.
Another example is that of a lady who came to my surgery and told me that she was acting as a home help for three different people. She was playing an invaluable role in her local community, but because of her work she found that she was to lose £14.75. She said to me, "I have a choice. Either I can continue to act as a home help and lose that amount of money a week, which I simply cannot afford to lose, or I can decide no longer to act as a home help." Because of the decision that was forced upon her, three elderly people do not have the services of a very compassionate woman, of great humanity, who had served those old people so well. The social consequences affect not just those who lose housing benefit, but the rest of the community because of the domino effect.
The Minister for Social Security and the Disabled has an intimate knowledge of Northern Ireland affairs. For that reason, I shall refer to one particular problem. The Secretary of State for Social Services said that, as a concession, elderly people who have to be committed to care will have six months in which to sell their homes. The Minister knows, because of his long experience in Northern Ireland, that in many areas of Northern Ireland houses cannot be sold; they cannot even be given away. An enormous problem will be created for some of the worst hit areas of Northern Ireland unless the Secretary of State looks closely at that problem.
In the broader sense, this is a tremendously harsh approach to adopt towards elderly people. The six months is a sentence—not a sentence of death, but a sentence of dependency. Elderly people will have six months, after which they will be unable to return to the little home that they have created over 40 or 50 years. They will have to depend on others for however long they live. The elderly deserve better than that.
There is one issue that relates specifically to Northern Ireland. It concerns a person who owns a small area of land. I am not talking about huge spreads; I am talking about the six, eight, 10 or 12 acres of land, most of which is rough, that provides no income. Is that to be subject to capitalisation? It was subject to capitalisation for supplementary benefit purposes. Is that land to be 384 capitalised and regarded as a source of income? If it is to be so regarded, the effects of the legislation will he even worse than I imagined.
I congratulate the Minister of State on thinking again about the threshold, and I commend him for responding, under pressure from his colleagues and others, to that point. I ask him, however, on the grounds of compassion and humanity, because of the deprivation that people will suffer, to think again and get rid of the iniquities and anomalies. The legislation will then be regarded as compassionate, not as something that cuts corners to the detriment of those who need the most help.
§ Mr. Patrick Cormack (Staffordshire, South)
It is a privilege to follow the hon. Member for Newry and Armagh (Mr. Mallon) who speaks so movingly about his constituency. I hope that my right hon. Friend the Secretary of State for Social Services, Vie ho I think missed the first few words of his speech, will read it carefully in Hansard.
I begin by thanking my right hon. Friend for his response. During the last three difficult weeks, a number of us have found ourselves on several occasions in the Opposition Lobby. I found myself appealing to my right hon. Friend on sight tests arid dental charges. During the last fortnight I found myself appealing in vain to my right hon. Friend the Secretary of State for the Environment. At least to some degree, I believe that this is third time lucky. My right hon. Friend the Secretary of State for Social Services has responded promptly and properly not just to hon. Members, because we seek merely to articulate the concerns that people put to us, but to the deep need expressed and the real suffering that has been caused throughout the country.
The hon. Member for Newry and Armagh referred to a new category of poor. I remember what was said in his speech on the Loyal Address by Sir John Nott when he was the Member for St. Ives. He said words to this effect: "The real poor of the 20th century are those without hope." Over the past few weeks, many people have felt deprived of hope.
I am grateful to my right hon. Friend the Secretary of State for his announcement. I hope that he will not think me churlish when I say that I do not think that he has gone far enough. I hope that he will still keep carefully under review the working of the new system. He will probably come to think—he is a sensitive man—that the £8,000 limit is not enough and that it should be £10,000. My right hon. Friend has also performed a signal service in recognising that that limit was not the be-all and end-all of the complaints and the sole creator of the suffering. I am glad to see him nod so vigorously in assent. Monitoring must be meticulous and continuous.
§ Mr. Cormack
I shall not. I normally give way regularly, but I am under an injunction and have promised to speak briefly. There are hon. Friends who have sat throughout the debate, as my hon. Friend has not, who should have the chance to take part if they catch your eye, Mr. Deputy Speaker.
I hope that my right hon. Friend the Secretary of State will monitor the new system carefully and continuously. I hope that he will recognise that, if there is a doubt, those 385 people who have been writing to us and who have been deeply grieved and troubled over the past couple of weeks deserve the benefit of the doubt.
The complexities of the system which has been replaced have led to another complex system. We should be less than honest with ourselves if we did not acknowledge that not all of us realised the full impact of the changes.
One fact is underlined: the Department over which my right hon. Friend the Secretary of State presides is too big. I do not say that in a spirit of criticism of my right hon. Friend or his colleagues. The time has come, as the troubles of the past fortnight graphically illustrate, for the two Departments—as they were once—to be separated. We need one Department to look after the National Health Service; we need another to look after the system of social services and security.
My right hon. Friend the Prime Minister began her career in the old Ministry of Pensions and National Insurance, when there was a Ministry of Health as well. There is sometimes virtue, as my right hon. Friend the Prime Minister has often demonstrated, in seeking to turn the clock back. I hope that, because of our troubles, my right hon. Friend the Secretary of State will not be demoted. He certainly does not deserve that, but I hope that there will be a rethink of the machinery and system of government.
I end as I began, by thanking my right hon. Friend for his prompt, ready and sensitive response. It is a good beginning, and I trust that he will continue in the same vein.
§ 6.3 pm
§ Ms. Diane Abbott (Hackney, North and Stoke Newington)
No fewer than two weeks after the legislation was implemented, we have seen a climb-down. It will not do to talk of unforeseen circumstances. The consequences of the changes in housing benefit were foreseen many years ago. What was unforeseen was the political fallout from the pain and suffering caused by these changes. This illustrates the maxim that the Tory party never panics, except in a crisis.
There has been much talk by Conservative Members about "rough edges", "anomalies" and "fine tuning". We must stress that structural problems remain with the whole social security review. It will not do to talk about anomalies. Until the structural problems are seriously addressed, the fears of my constituents in Hackney will not be quelled.
I stress, although this point was made earlier, that the suffering caused by the housing benefit changes was not just a matter of capital and savings. There are 38,000 people in Hackney on housing benefit—most lost under the changes. Hardly any has capital. There is not a lot of capital accumulation in Hackney. Those people lost because of changes in how much they pay for their domestic rates, water rates and heating charges.
Furthermore, the Government's changes were virtually confiscatory of occupational pensions. An extraordinary number of pensioners came to see me, having scrimped and saved throughout their lives—sometimes until their 70s—only to find that, through these housing benefit changes, they would lose their occupational pensions at one stroke. I do not understand how it fits in with the 386 alleged Tory philosophy of encouraging thrift and saving to introduce reforms which confiscate the occupational pensions of many thousands of pensioners.
In the light of the announcement by the Secretary of State, I feel obliged to ask the questions that Hackney and, above all, the manager of the local DHSS office will ask. If pensioners are to get back the money that they have lost since 1 April, when will the scheme start? Can they go to their DHSS office tomorrow, or will they have to wait for the forms to be printed? These people have to live on £26 a week. Their need is immediate. They will want to know just how quickly the scheme will come into operation.
Most of Hackney's local DHSS offices have terrible problems with staff shortages and delays in handling cases. They will want to know whether extra staff will be made available to handle this operation. If extra staff are not made available and people who try to get their money back just go behind the queue of those already waiting for responses to fresh and different claims, pensioners will not be helped in the foreseeable future.
It is all very well to come before the House and pull opportunistic rabbits out of hats. We want to know how the transitional arrangements will work. Will resources be made available to DHSS offices? When can people go to local offices to get their money? Above all, for how long will the transitional arrangements last? It is one thing to talk about transitional arrangements, but the positon of pensioners—it is largely pensioners who come to see me—is absolute. If the transition ends in a year, they will still be faced with problems.
A Mr. Fisher came to see me. He was originally on a pension of £41.37. Because of the housing benefit changes, he will have only £28 on which to live. If the transitional period lasts only a year, Mr. Fisher will still be reduced to having only £28 on which to live. In a year, this will be as relevant as it was when he asked me a week ago how the Minister suggests he should live on £28 a week.
There has been political sleight of hand in response to political panic. Hundreds of people face serious financial cuts. The one thing that Conservative Members have forgotten to say when talking about the "relative" poor and "targeting" is that the incomes of these people are tiny. It will not do for Conservative Members to talk about relatively well-off pensioners when these pensioners are living on incomes of £40 or £50 a week.
We have seen the Government' political conjuring; now they should tell us the facts. How will the transitional arrangements work? When will they come into operation? Is there any undertaking to review and extend them to preserve the living standards of some of the very poor people whom Labour Members represent?
§ 6.8 pm
§ Mr. Henry Bellingham (Norfolk, North-West)
It is a pleasure to follow the hon. Member for Hackney, North and Stoke Newington (Ms. Abbott) for the first time. We understand why she is highly regarded as a constituency Member of Parliament.
Many of my constituents, not least pensioners, have contacted me about the benefit changes. In north-west Norfolk there is a growing number of elderly retired people. The vast majority of them accept the broad thrust of the social security changes because they understand the need for a simpler and more efficient system that cuts out some of the abuses, eradicates the unemployment trap, 387 and, above all, targets benefits more fairly. However, a fair number of them were a little surprised and bewildered and, in some cases, dismayed by the £6,000 capital limit.
Like many hon. Members, I have received representations which I have put to Ministers. I wholly welcome today's announcement. It is not fair to say, as some Opposition Members have said, that the Government have climbed down under the force of pressure, retreated and done a U-turn. The Government should be congratulated.
§ Mr. Gorst
My hon. Friend says that he wholly welcomes what the Government have done, but, if the Government make a blunder and change it into a mistake—if they get something 100 per cent. wrong and now have it only 15 per cent. wrong—how can my hon. Friend be wholly satisfied? Like him, I have received many representations from people. Where will those people obtain £2.50 that they never had before?
§ Mr. Bellingham
I do not regard what the Government did as a blunder. It was a mistake, and they have now corrected it and, above all, rendered the system far more acceptable.
The Government should not feel any shame about what they have done. They have shown that they are prepared to listen to representations, to consider individual cases and, above all, to come forward with remedies. I was particularly impressed by the comments of my hon. Friend the Minister for Social Security and the Disabled on 13 April when he said that he would monitor the changes and consider every detail and the impact of the reforms over a prolonged period and be prepared to listen and be flexible. What the Government have done today is therefore extremely welcome.
§ Mr. Bellingham
No, I shall not give way, as we are trying to make progress.
What has been the response of Opposition Members so far? They have derided the Government. Their constant tirades are wholly illogical. They have made endless attacks. They have not mentioned the Government's putting £2 billion more into social security this year. They have not mentioned the fact that, in cash terms, nine out of 10 people will be better off, or no worse off. They have not mentioned the fact that £1 in £3 of Government expenditure now goes towards social security, whereas, under the Labour Government, it was £1 in £4. They give no credit to the Government for the fact that, in 1978, £1.24 billion was spent on housing benefit, whereas, in the tax year 1987–88, £5.2 billion was spent on housing benefit.
Opposition Members must say what they would do, if their position is to be credible. Would they keep the old system, with all its abuses and anomalies? Do they believe that it is right that, as under the old system, a person with £30,000 capital should receive housing benefit? Do they believe that it is right for the abuses under the single payments scheme to continue? They do not tell us what they would do, particularly in respect of the ever-increasing cost of housing benefit.
We hear a great deal about immoral, un-Christian, uncaring and even wicked measures, but what is caring or Christian about keeping a system that is creaking at the seams and growing like Topsy, as the Minister of State said? What is caring or right about keeping a system that 388 discriminates against low-paid people in work, discourages thousands of others from finding work and has a built-in unemployment trap? The system is discredited, yet the Opposition want to keep it going. There is no answer to those points because the Opposition's position is wholly illogical. Surely the caring, correct and sensible way forward is to try to target benefits at those who need them most.
I had a conversation about housing benefit with some constituents over the weekend. They said that it would probably make sense if one house in five were to receive housing benefit, but not if one in three were to receive it. We must set the limit somewhere. We must ask ourselves whether it is right to ask low-paid people, through their taxes, to help those with substantial savings.
§ Mr. Bellingham
No, I shall not give way. We must make progress.
The figure decided upon by the Government, following representations, is right. As the Minister said recently, nothing is cast in stone. Those figures can change. The system is now far more effective and changes can and will be made in the future, as and when the need is shown to exist. The Government will act flexibly.
There is nothing caring about building up excessive dependence on the state and creating a culture which encourages people to turn to the state in the first resort as a matter of course. The Opposition do not have answers. Opposition Members churn out individual cases by the dozen, but we have heard nothing about those pensioners with £3,000 of savings who will receive more housing benefit or about other cases where people will be considerably better off.
The Minister will be interested to know that I had a telephone call over the weekend from a Labour councillor. I shall read out the message because it was not edited by me. It states that the councillorwould be most grateful if you could call him. He sounded very nice by the way. He stressed that politically you are not in agreement. Just wanted you to know that he has heard from the grass roots how well the new benefit system is working. He knows of one family who were getting 50p or 60p under FIS, who were really poor, who are now getting £20 a week. He knows of another person who is now getting £60 a week and not £20 as before.We hear only of those cases where people are much worse off. The Government have said that they will consider them with compassion and flexibility. The old system was seriously discredited. No Government could have stood back and done nothing, particularly a reforming Government elected on a mandate to encourage enterprise initiative and self-help.
However, there is a need for a comprehensive safety net below which nobody can fall. We must bear in mind that any social security system or comprehensive safety net is based, above all else, on the productive wealth of a country. If there is no productive base and wealth creation is stifled by a system that is growing out of all proportion, the wealth-creating system will be jeopardised and the poorest people will suffer most. That is precisely what was happening. The increases were uncontrollable. The system is now far more effective. By the time we have sorted out the details, it will be fairer and, after what the Government 389 have done today, much more acceptable. I shall certainly support the Government's amendment tonight, and I urge my colleagues to do likewise.
§ 6.9 pm
§ Ms. Dawn Primarolo (Bristol, South)
This afternoon, we have been treated to a wonderful spectacle on Conservative Benches.. One minute, in their prepared speeches from Central Office, Conservative Members told us that the last Labour Government threw cash around like it was going out of fashion and that they did not direct money in any way. The next minute, the hon. Member for Wokingham (Mr. Redwood) told us that the last Labour Government were too mean. Yet, in 1979 and since, the Conservative Government have based their policies against the Labour party and the electorate—those who are on benefit—on saying that those on benefit should not get more than those doing the lowest paid job in society. Everybody remembers—
§ Ms. Primarolo
I shall not give way. I have 10 minutes in which to speak. Many hon. Members have contributed to the debate, and I wish to press on.
We well remember the long posters stating: "Labour isn't working". The Conservative party forced up benefits to make sure that people voted at any price. I wonder whether the Government misled the electorate then, or do they seek to mislead the electorate today?
Let us be clear about housing benefit. It does not stand in isolation. I was a member of the Standing Committees that examined the social security and housing legislation and considered the relationship between various benefits. In reply to my hon. Friend the Member for Leeds, West (Mr. Battle), the Minister for Housing and Planning pointed out six times—he even chastised us—that there would be no reduction in housing benefit and that it would be the main tool for protecting tenants when the Housing Bill becomes law. Because of the changes that have been made, tenants now have no protection.
Having taken away £670 million, the Government give back £100 million today, and expect us to say, "Don't worry, everything is hunky-dory." Having once claimed to simplify it, they make announcements that will make the system more complex, and then expect us to congratulate them. They made the changes because of Opposition Members' work on exposing their policies, and then they expect us to congratulate them. We shall not do that. It is not enough. The Government must do more. On Second Reading and in Committee, Conservative Members said that housing benefit would be the major form of protection for tenants in the private sector. It will not.
I draw the attention of the House to a couple of cases, the principles of which are not dealt with by the amendments. The first involves a single parent who has one child. Following the ethics that the Government preach to her, she works part-time. As a result of the changes, she is £5.27 a week worse off. The reason is that, in the the family credit that she now receives, there is an adjustment of £2.50 to pay for the free school dinners that she has lost. Free school dinners cost £4 a week, and her compensation was only £2.50. We shall overlook that point for a moment. That £2.50 was counted as unearned 390 income, and she lost £5.27 housing benefit. That is not dealt with by the amendments, and that person is still losing.
The second case involves a private tenant, a disabled woman who is separated from her husband. She works part-time and receives £38 per week. She also receives £12 from her ex-husband. Until the changes, she was paying £9.10 a fortnight for her rent and rates. She must now pay an additional sum of £18 a fortnight, as a direct result of the changes in housing benefit. One day she was entitled to benefit, and the next day she was £18 a week worse off. She is not helped by the changes. Indeed, when the Housing Bill comes into force, as a private tenant, her position will deteriorate. She has not had a holiday for five years. She asked me to tell the Health Ministers that she does not smoke or drink, but she doubts whether, as a result of the changes, she will be able to exist in future.
The Minister should explain exactly what we should say to people about how they are to manage on the miserly sums that the Government are allowing them to live on. How can we explain to them that, after the Budget, some people are thousands of pounds a month better off, yet the Government are taking from them some basic amounts?
Another woman wrote to me. She is an owner-occupier. She is an old-age pensioner, 66 years old—the model of Tory ideology in terms of saving money all her life. She receives a pension of £27.72 and a payment from her ex-husband, which give her an income of £42.21 a week. Because of rates, she loses under the 20 per cent. reduction. She described her lifestyle. She has worked all her life. Her generation's contribution has been mentioned. She has one coal fire in her house. She saves all the year round to buy coal. She lights that one fire one afternoon a week—on Sunday, when she has visitors. She has meat once a week. Every other day, she eats a baked potato, an apple and some cheese.
It is disgusting that Conservative Members should subject people to that type of lifestyle and then preach on about what the Labour Government did in 1979. We are talking about now. That lady wraps herself in blankets with hot water bottles and goes to bed at 8 o'clock every night throughout the winter, and stays up only in the summer when it is warm enough to do so. Her only luxury is a cat.
Those people are not helped by the amendments. It is clear that the changes in the social security system will lead to massive hardship. To Conservative Members and to many Opposition Members it may seem only a small amount of money compared with the salaries that we receive, but to people who are trying to live on £20, £30 and £40 a week, it means the difference between being able to eat and being able to keep warm.
I have some questions for the Minister. The six months grace for selling a home will apply to housing benefit, but will it apply to income support? Obviously, in the cases that the Leader of the Opposition has highlighted, it has been a real problem. The transitional protections under the income support regulations will be cut every time a person's circumstances change. Will that happen to housing benefit too? How many people do the Government expect still to get protection in 12 months? About 5.5 million people suffered loss as a result of the changes in the regulations.
Today, with the changes that the Government have announced, 400,000 people will not be quite so badly off. What about the other 5 million? When will the 391 Government do something instead of giving us platitudes and figures about what they are spending and realise that, for many complex reasons, the reality—what is going on in people's lives—is not reflected in the Government's figures. It is about time that the Government did something about it.
§ Mrs. Margaret Beckett (Derby, South)
This is, unquestionably, a watershed debate. [Interruption.] It is beginning to dawn on Conservative Members—clearly not those giggling below the Gangway—what their Government have been up to.
Over the past three years—you, Mr. Deputy Speaker, can testify to this as you have frequently been in the Chair on these occasions—we have described over and over again exactly the same problems about which we have heard today. Conservative Members, with a few honourable exceptions, have behaved like the hon. Member for Gainsborough and Horncastle (Mr. Leigh) did a few moments ago; they have jeered, sneered or completely ignored our predictions. To be fair, I can understand that they could not believe what was about to happen, even though it was predicted not only by us but by every other independent group or commentator. It is true that we were not 100 per cent. accurate, and perhaps we should apologise for that, although we were more accurate than the Government. We erred on the side of generosity.
Until two weeks ago, the Government dismissed all our figures as hypothetical, misleading and exaggerated. What we have heard over the past few days makes it clear that the losses in housing benefit, as the Government initially intended it to be imposed, were worse than those hypothetical figures.
As Conservative Members are perhaps beginning to listen to the case being put by the Labour party, I shall make two points. First, we should look, in the context of this debate, at the basis of the Government's argument —which was parroted by Conservative Members—about why they should make savings in housing benefit—savings from which today we have forced them so spectacularly and abruptly to begin to retreat.
Again today, the argument was advanced that housing benefit must need cutting because it goes to one household in three and because the budget has risen since 1979. I recommend that Conservative Members who parroted those arguments read not only the briefings that they get from the Whips Office or Central Office but the 1985 or 1988 report of the Government's Social Security Advisory Committee. In both those reports, they will find admirably set out the reason for increased expenditure on housing benefit—the increase in housing costs. Those costs are higher now than in 1979 or 1982, when the Government introduced the housing benefit scheme, which the Secretary of State comprehensively denounced this afternoon as unfair, complicated and dreadful.
As some Conservative Members were not paying as much attention as they should have been when the Secretary of State referred scathingly to the Opposition having done nothing about the scheme, I shall repeat that it was this Government's scheme, which they introduced in 1982, that the Secretary of State was criticising. Although he criticised the Opposition for not dealing with the worst 392 aspects of the poverty trap in the preceding scheme, his criticisms of the poverty trap that preceded this scheme were criticisms of his Government, not ours.
§ Mrs. Beckett
I am sorry, but I am short of time. I shall give way to the hon. Gentleman only if I have enough time.
This is not the Government's first attempt to evade the consequences of the net effect of housing benefit changes. The hon. Member for Brighton, Kemptown (Mr. Bowden) saved me time by listing a substantial number of the cuts that the Government have made and mentioning the millions of people whom they have excluded or who have lost help with housing benefit in recent years.
Cumulative savings of £366 million were made between 1983 and 1987, before the £650 million-worth of savings that the Government had planned to make this year. During that same period, despite the cuts in spending on housing benefits, which rose to £5,000 million, the subsidy in housing costs, which helps to keep rents down, has been cut by a cumulative total of £5,000 million, in real terms at 1987–88 prices. That cut led to the 155 per cent. increase in average local authority rents, which has so contributed to the numbers of people who need and draw housing benefit. That is only the cut in average local authority rents: there have also been cuts in rate support grant, which have led to increases in rates, and again the need for housing benefit to be increased.
Conservative Members do not realise that help with housing benefit is a smaller proportion of the rent and rates bill for every individual who receives that help than it was in 1979, 1982 or 1983. That help is not only a smaller proportion of housing costs but is lost at lower incomes—far below average earnings for those with average rent and rates. Before April 1983, a single pensioner would have lost entitlement to housing benefit at a weekly income of £94.35p. From April this year, such a person loses entitlement to housing benefit at a weekly income of £64.51. That is a cash cut of £30, never mind what it is in real terms. The argument that the housing benefit scheme is over-generous falls apart if one troubles to scrutinise the facts.
We have been calling for the concessions that have been announced today in the capital limit and on the transitional arrangements. It is a pity—it would have saved many people much anguish and heartache—that the Government were unable to announce any concessions in transitional arrangements over the past three years, as they did in 1982. It is a pity that they had to make it so crystal clear that they were determined to make these cuts if they could possibly get away with it.
It is a pity that, because only concessions in transitional protection have been offered, the losses that have been described still occur—although, as my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) said, they will be more gradual. It is a pity that the savage tapers and rule changes, which have caused losses to over 5 million people, will remain wholly untouched and will bite unamended on new claimants or those who give up benefit for a period but return at the new levels.
It is a pity that the marginal rate of tax—85p in the pound for those who claim housing benefit—begins to apply at incomes just over £3,500 a year for a couple. Government Back Benchers have described the benefits 393 scheme as over-generous, yet a month ago in the Budget the Chancellor said that the highest rate of marginal tax applied to the most wealthy should be 40p in the pound.
It is a pity that, despite the transitional protection that has been announced today, people will still face rent rises of up to £7 or £8 a week. Conservative Members have not noticed that, although the Secretary of State is saying that losses above £2.50 will be made good, he is also saying that that will be based on last year's rent and rates, not this year's. An initial calculation that I have received from Edinburgh shows that people will lose between £5.50 and £8 a week before any help will be given. [Interruption.] I am glad to see that the hon. Member for Macclesfield (Mr. Winterton) at least has appreciated that point.
It is a pity that two people in identical circumstances will receive rebates that differ by £10 a week or more, depending on whether they claim before or after 1 April, because new claimants do not get transitional protection.
It is certainly a pity that not only is there an incredibly complex system for claiming that concession—which will certainly cause headaches for local authorities and will have to be operated by claimants—but it appears that the childless, the young, and childless widows who are not pensioners will be excluded even from the help that is being offered.
That is the major case that I want to make about the concessions, the nature of the Government's scheme and what they are offering. My second point concerns the restricted nature of this debate. Now that Government Back Benchers have been forced to accept that the Labour party understands and accurately describes the effects of the changes that the Government are making, perhaps they will listen not only to us but to others who dispute the Government's claim about housing benefit and the rest of the changes that the Government are making.
I shall quote from a letter dated 26 April sent by the Royal National Institute for the Blind to the Secretary of State. It states:Over the past two years we have repeatedly put to you and your officials cases illustrating the levels of loss which disabled people would face … We have refuted the Government's claim that only 80,000 'Sick and disabled people' will be worse off.That refers not to the housing benefit changes, but to some small part of the other changes that the Government will pass.
§ Mrs. Beckett
I shall give way later, if I can.
Today's debate barely deals with the tip of the iceberg of the Government's changes. It is not even the case that all the losses on housing benefit are yet apparent. My local authority is having problems with the computer software, although I understand from it and the company involved that mine is substantially ahead of many other local authorities. Many local authorities have not been able to inform their electorate of the scale of losses that the electorate is likely to face.
Apart from not knowing all the losses even on housing benefit, there are the losses on other rule changes; the losses when people lose transitional protection on income support; the impact when those who have transitional protection get increased bills but no increased income to meet them; and the impact when the desperate are not only 394 turned away after applying for help with essential items from the social fund, but told that they cannot even re-apply for six months. More than all that, there is the devastating impact of the gap that new claimants will find between their needs and their income.
On Monday my local social security office gave me the example of someone diagnosed as near to the date of their death. Sadly, that does occur. Under the old system, the office could have visited and given every kind of additional allowance and help it could lay its hands on. Now, such a patient cannot be offered anything except, if they are lucky, a crisis loan. If such a person lives long enough to qualify for an attendance allowance, that is six months, he may be able to get some help. If all the generous help from the Government to protect the severely disabled is heavily linked to benefits such as the attendance allowance, for which one must be seriously ill for six months to qualify, those families will suffer not only bereavement but a death debt with it. All that is still to come.
Clearly, a few Conservative Members understand that. The hon. Member for Pudsey (Sir G. Shaw) spoke in deep and almost impenetrable code, but I think he told his Ministers that this was not the last but only the first climbdown that they would have to make. The hon. Member for Brighton, Kemptown (Mr. Bowden) showed remarkable perspicacity when he said to his Front Bench colleagues:I do not believe that the Bill will stand the test of time." —[Official Report, 20 May 1986; Vol. 98, c. 269.]I doubt whether even the hon. Gentleman thought that the measure would not last three weeks.
We know that some Conservative Members are considering how they will vote tonight. When they make that judgment, they should remember that that is just the start of the relevation of the damage which their Government are doing. I can understand that people find it difficult to believe in the nature and scale of the losses that we have consistently identified. A reason must be that they could not understand why even this Government should take such a political risk.
Incidentally, on 12 April the Chief Secretary said that Ministers had no plans to bow to the rising tide of criticism by tinkering with the regulations, but we shall pass over that. He also said:At the heart of the reform is the ending of the discrimination between low income people in work and those not in work on benefit.The Chief Secretary put his finger on the essential point: this is part of the Government's attack on trade union rights, part of the promotion of a low wage economy—benefits must be even lower than wages—and part of their attack on the principle of the welfare state.
The Chief Secretary's words echoed those of the Royal Commission on the Poor Law in 1832:the situation of the individual relieved should not be made really or apparently so eligible as the situation of the independent labourer of the lowest class.The Government are at one with the Poor Law Commission.
§ Mrs. Beckett
I am sorry, but I have only about one minute.
This is part two of the attack on the principles of the welfare state: the principle of universality and the principle 395 of an emphasis on rights, not charity. Lest any hon. Members on Conservative Benches or on ours doubt the direction in which the Government are going, I refer them to an article by Professor Minford in The Daily Telegraph on 25 April:It is the existence of income support at all for pensioners that is the disincentive to save.The view of those who advise this Government is that the changes do not go far enough; it is just a step along the road towards demolishing the welfare state.
Clearly, it has come as an unpleasant shock to the Government that even Tory voters have been undermined by 50 years of promotion of Socialist ideas, as the Secretary of State for the Environment said the other day, to believe that they should have rights and dignities, and should not be ashamed of claiming benefits for which they have contributed. The fact that they believe that has forced the Government to back down today on this minor aspect of the changes. Tory Back Benchers threatened to vote with the Labour party. The only way in which the Government will back down from the overwhelming damage that they intend to pensioners, the sick, the disabled and the unemployed is if those who have the opportunity, particularly at the local elections on 5 May, show, by voting resoundingly for the Labour party, that they reject the Government's philosophy and principles which cost the elderly and disabled so dear.
§ The Minister for Social Security and the Disabled (Mr. Nicholas Scott)
I understand the need of the hon. Member for Derby, South (Mrs. Beckett), in her peroration, to accuse the Government of every possible attack on the elderly, the sick and the poor that she can find in her catechism, but her criticisms sit ill with the Government's record on social security since we came to office in 1979. I cannot see how her criticisms, or the surprising attack on the Government from the hon. Member for Birkenhead (Mr. Field), characterising the changes as an attack by the rich on the living standards of the poor, sit with the steady and consistent increase in both the scope and extent of social security under this Government.
Today we are spending 40 per cent. more in real terms on benefit than the Labour Government. [Interruption.] We are spending nearly £ 1 billion a week on social security benefits. [Interruption.]
§ Mr. Speaker
Order. The hon. Lady was heard in silence. It is only fair that the Minister should have a hearing.
§ Mr. Scott
Every working taxpayer is contributing £40 a week towards social security. We are helping more than 6 million people with rent, rates, or both. The criticism that the Government's record on the disabled does not stand up to scrutiny is particularly offensive. Spending on the disabled has risen by no less than 80 per cent. in real terms under this Government—over £3 billion in real terms. Those criticisms do not stand up. I rebut them only because the hon. Lady made them. This debate covers narrower ground, because we are discussing an Opposition motion on housing benefit and the Government's amendment to it.
I am glad to reply to this debate on the proposals that my right hon. Friend the Secretary of State put to the House this afternoon. His response showed clearly the Government's determination to fulfil the pledge that we 396 gave previously, that, as we implement these reforms, we shall listen carefully and be responsive to criticisms—[Interruption.] I cannot conceive how Opposition Members can characterise this as a climbdown or a U-turn. We are spending £5.2 billion on housing benefit and we are today making a modest adjustment of £100 million to respond to criticisms by my hon. Friends and some Labour Members.
My hon. Friend the Member for Pudsey (Sir G. Shaw) put it exactly right. It is the duty of the Government to listen, to be responsive to and to use good judgment about criticisms. The Government have done that without any of the arrogance that we too often saw from Labour Members when they were on these Benches.
§ Mr. Scott
My hon. Friend the Member for Ryedale (Mr. Greenway) asked for a specific continuing commitment that we shall continue to monitor the impact of these changes as the years go by. I suggest that the fact that we have had this debate, and the announcement by my right hon. Friend earlier, will arouse considerable interest among the public. We will be making an early announcement about the steps that people should take to avail themselves of the transitional protection that we have announced today. We hope to make an announcement within the next few days on cases of exceptional hardship. I hope that hon. Members of all parties will draw these matters to the attention of anyone who may be able to benefit from the transitional protection.
The hon. Member for Ross, Cromarty and Skye (Mr. Kennedy) accused us of abandoning the simplicity of the existing system. That is not true. As my right hon. Friend the Prime Minister said yesterday, the structure is substantially the same as it was. We are being responsive to a pair of problems which have presented themselves where we believe early action is necessary.
I also reinforce the point, which I think the hon. Member for Ross, Cromarty and Skye made, that the transitional protection is nothing to do with our local offices. It will be administered centrally by a special unit, although we will need the support and co-operation of local authorities in filtering the applications as they come through.
The hon. Member for Birkenhead asked two or three questions, apart from his general attack on the Government, and I should like to respond to those. He asked whether all those on housing benefit supplement will be covered by the transitional protection. The answer to his question is that they will be covered if they fall within the categories outlined by my right hon. Friend in his opening remarks. Pensioners, sick and disabled people, and families with children will be covered if they suffer as a result of the ending of housing benefit supplement.
The hon. Member for Birkenhead also asked—this point has been raised by other hon. Members—why we chose the figure of £2.50. First, it is worth reminding ourselves that we are talking not about people on income support, but people who are above income support level. Further, we had to balance the cost of administering any new scheme of transitional protection against the benefits which would ensue. Again, it was a matter of judgment which led us to choose £2.50 as a reasonable way of protecting those with high losses over a transitional period.
397 My hon. Friend the Member for Brighton, Kemptown (Mr. Bowden), the hon. Member for Birkenhead and other hon. Members asked what will happen to transitional payments in the course of time: will they be treated in the same way as other transitional arrangements or finish after a single year? They will be treated in the same way as transitional arrangements in other circumstances. Increases in benefits will erode the provision necessary under transitional protection. After one year, fewer people will need that transitional protection; after two years even fewer people will need it; and eventually the need for it will disappear. I recognise that appropriate help may have to be given over an extended period to some of those people for whom we have announced that protection will be available.
The hon. Member for Newry and Armagh (Mr. Mallon) raised a number of points. First, he mentioned the deprivation in Northern Ireland, with which both he and I are familiar. We know who is largely responsible for deprivation in that part of the United Kingdom. The administration of the transitional protection in Northern Ireland has still to be decided—for example, whether it will be done by the central unit of the DHSS on this side of the water or the DHSS in Northern Ireland. It may be that the Housing Executive in Northern Ireland will be the more appropriate body for handling that matter. As we are handling it centrally for Great Britain, it may be sensible to cover Northern Ireland on the same basis. We shall make a final decision on that later.
The hon. Member for Newry and Armagh also asked about small amounts of land which may be held in Northern Ireland. The situation there is that if the land is worked, the income generated from it will be taken into account. If it is not worked, the capital value will be taken into account. If it is virtually worthless, it will be totally ignored and treated as such. He also said that houses in Northern Ireland are difficult to sell because of the particular circumstances in the Province. In that event, the six-month rule is capable of being extended.
§ Mr. Scott
No, I shall not give way.
What I have shown today is that the changes that my right hon. Friend announced were intended to ease two important situations, where the shoe was pinching as a result of the introduction of the benefits.
My hon. Friend the Member for Wokingham (Mr. Redwood) starkly contrasted the records of the Conservative and Labour Governments in these matters. Let us look at housing benefit and contrast the Labour record with that of the Conservative Government.[Interruption.]
§ Mr. Scott
In real terms, the Labour Government's £1.23 billion in 1978–79 represented not an increase, but a reduction of 2 per cent. in expenditure on housing support. The Conservative Government's record shows an increase of 107 per cent. in real terms over the period of—[Interruption.] Indeed, the Member for Derby, South suggested in her reply to the debate— she quoted the Social Security Advisory Committee in support of this—that it is not the RPI that should be taken into account, but the increase in housing costs. However, if we take rent levels as a measure, the Labour Government managed an increase of only 2 to 3 per cent. in real terms during their period of office.
§ Mr. Scott
The 2 to 3 per cent. increase in real terms during the term of the Labour Government contrasts with the increase of over 50 per cent. in real terms under this Government. The fact is that the Labour party failed when it was in office, and it is failing again. We have provided the resources for housing support—[Interruption.]
§ Mr. Scott
The fact is—and the hon. Member for Livingston knows it—that the Labour Government failed to generate the wealth to provide for their social security spending. Does he remember the Labour Government's approach to social security spending? I shall remind him of what Joel Barnett said about the Labour Government. He stated:It might be said that the first few months … were characterised by our spending money which in the event we did not have.Where did that lead? It led to the IMF, cuts in social security and the inability of the Labour Government to fulfil the high-flown promises that they presented to the electorate. They will fail again, given half the chance.
§ Mr. Speaker
The original Question was the motion on the effects of the new housing benefit changes in the name of the Leader of the Opposition—
§ Question put, That the original words stand part of the Question:—
§ The House divided: Ayes 228, Noes 324.402
|Division No. 278]||[7.pm|
|Abbott, Ms Diane||Dobson, Frank|
|Adams, Allen (Paisley N)||Doran, Frank|
|Allen, Graham||Douglas, Dick|
|Alton, David||Duffy, A. E. P.|
|Anderson, Donald||Dunnachie, Jimmy|
|Archer, Rt Hon Peter||Dunwoody, Hon Mrs Gwyneth|
|Armstrong, Hilary||Eadie, Alexander|
|Ashley, Rt Hon Jack||Evans, John (St Helens N)|
|Banks, Tony (Newham NW)||Ewing, Harry (Falkirk E)|
|Barnes, Harry (Derbyshire NE)||Ewing, Mrs Margaret (Moray)|
|Barnes, Mrs Rosie (Greenwich)||Faulds, Andrew|
|Barron, Kevin||Field, Frank (Birkenhead)|
|Battle, John||Fields, Terry (L'pool B G'n)|
|Beckett, Margaret||Fisher, Mark|
|Beggs, Roy||Flannery, Martin|
|Beith, A. J.||Foot, Rt Hon Michael|
|Bell, Stuart||Foster, Derek|
|Benn, Rt Hon Tony||Foulkes, George|
|Bennett, A. F. (D'nt'n & R'dish)||Fraser, John|
|Bermingham, Gerald||Fyfe, Maria|
|Bidwell, Sydney||Galloway, George|
|Blair, Tony||Garrett, John (Norwich South)|
|Blunkett, David||Garrett, Ted (Wallsend)|
|Boateng, Paul||George, Bruce|
|Boyes, Roland||Golding, Mrs Llin|
|Bradley, Keith||Gordon, Mildred|
|Bray, Dr Jeremy||Gould, Bryan|
|Brown, Gordon (D'mline E)||Graham, Thomas|
|Brown, Nicholas (Newcastle E)||Grant, Bernie (Tottenham)|
|Buchan, Norman||Griffiths, Nigel (Edinburgh S)|
|Buckley, George J.||Griffiths, Win (Bridgend)|
|Caborn, Richard||Grocott, Bruce|
|Callaghan, Jim||Hardy, Peter|
|Campbell, Menzies (Fife NE)||Hattersley, Rt Hon Roy|
|Campbell, Ron (Blyth Valley)||Heffer, Eric S.|
|Campbell-Savours, D. N.||Henderson, Doug|
|Cartwright, John||Hinchliffe, David|
|Clark, Dr David (S Shields)||Hogg, N. (C'nauld & Kilsyth)|
|Clarke, Tom (Monklands W)||Holland, Stuart|
|Clay, Bob||Home Robertson, John|
|Clelland, David||Howarth, George (Knowsley N)|
|Clwyd, Mrs Ann||Howell, Rt Hon D. (S'heath)|
|Cohen, Harry||Hoyle, Doug|
|Coleman, Donald||Hughes, John (Coventry NE)|
|Cook, Robin (Livingston)||Hughes, Robert (Aberdeen N)|
|Corbett, Robin||Hughes, Roy (Newport E)|
|Corbyn, Jeremy||Hughes, Sean (Knowsley S)|
|Cousins, Jim||Hume, John|
|Cox, Tom||Illsley, Eric|
|Cryer, Bob||Ingram, Adam|
|Cummings, John||Janner, Greville|
|Cunliffe, Lawrence||John, Brynmor|
|Cunningham, Dr John||Johnston, Sir Russell|
|Dalyell, Tam||Jones, Barry (Alyn & Deeside)|
|Darling, Alistair||Kaufman, Rt Hon Gerald|
|Davies, Rt Hon Denzil (Llanelli)||Kennedy, Charles|
|Davies, Ron (Caerphilly)||Kilfedder, James|
|Davis, Terry (B'ham Hodge H'l)||Kinnock, Rt Hon Neil|
|Dewar, Donald||Kirkwood, Archy|
|Dixon, Don||Lambie, David|
|Lamond, James||Prescott, John|
|Leadbitter, Ted||Primarolo, Dawn|
|Leighton, Ron||Quin, Ms Joyce|
|Lestor, Joan (Eccles)||Randall, Stuart|
|Lewis, Terry||Redmond, Martin|
|Litherland, Robert||Rees, Rt Hon Merlyn|
|Livingstone, Ken||Reid, Dr John|
|Livsey, Richard||Richardson, Jo|
|Lloyd, Tony (Stretford)||Roberts, Allan (Bootle)|
|Lofthouse, Geoffrey||Robertson, George|
|Loyden, Eddie||Rogers, Allan|
|McAllion, John||Rooker, Jeff|
|McAvoy, Thomas||Ross, Ernie (Dundee W)|
|McCusker, Harold||Rowlands, Ted|
|McFall, John||Ruddock, Joan|
|McGrady, Eddie||Sedgemore, Brian|
|McKay, Allen (Barnsley West)||Sheerman, Barry|
|McKelvey, William||Sheldon, Rt Hon Robert|
|McLeish, Henry||Short, Clare|
|McNamara, Kevin||Skinner, Dennis|
|McTaggart, Bob||Smith, Andrew (Oxford E)|
|McWilliam, John||Smith, C. (Isl'ton & F'bury)|
|Madden, Max||Smith, Cyril (Rochdale)|
|Mahon, Mrs Alice||Smith, Rt Hon J. (Monk'ds E)|
|Mallon, Seamus||Smyth, Rev Martin (Belfast S)|
|Marek, Dr John||Snape, Peter|
|Marshall, David (Shettleston)||Soley, Clive|
|Marshall, Jim (Leicester S)||Spearing, Nigel|
|Martin, Michael J. (Springburn)||Steel, Rt Hon David|
|Maxton, John||Steinberg, Gerry|
|Meacher, Michael||Stott, Roger|
|Meale, Alan||Strang, Gavin|
|Michael, Alun||Straw, Jack|
|Michie, Bill (Sheffield Heeley)||Taylor, Mrs Ann (Dewsbury)|
|Michie, Mrs Ray (Arg'l & Bute)||Thomas, Dr Dafydd Elis|
|Millan, Rt Hon Bruce||Thompson, Jack (Wansbeck)|
|Mitchell, Austin (G'f Grimsby)||Turner, Dennis|
|Molyneaux, Rt Hon James||Vaz, Keith|
|Moonie, Dr Lewis||Wall, Pat|
|Morgan, Rhodri||Wallace, James|
|Morris, Rt Hon A. (W'shawe)||Walley, Joan|
|Morris, Rt Hon J. (Aberavon)||Warden, Gareth (Gower)|
|Mowlam, Marjorie||Wareing, Robert N.|
|Mullin, Chris||Welsh, Andrew (Angus E)|
|Murphy, Paul||Welsh, Michael (Doncaster N)|
|Nellist, Dave||Williams, Alan W. (Carm'then)|
|Oakes, Rt Hon Gordon||Wilson, Brian|
|O'Brien, William||Winnick, David|
|O'Neill, Martin||Wise, Mrs Audrey|
|Orme, Rt Hon Stanley||Worthington, Tony|
|Owen, Rt Hon Dr David||Wray, Jimmy|
|Parry, Robert||Young, David (Bolton SE)|
|Pendry, Tom||Tellers for the Ayes:|
|Pike, Peter L.||Mr. Ken Eastham and Mr. Frank Cook.|
|Powell, Ray (Ogmore)|
|Adley, Robert||Bennett, Nicholas (Pembroke)|
|Aitken, Jonathan||Benyon, W.|
|Alexander, Richard||Bevan, David Gilroy|
|Alison, Rt Hon Michael||Biggs-Davison, Sir John|
|Allason, Rupert||Blackburn, Dr John G|
|Amery, Rt Hon Julian||Blaker, Rt Hon Sir Peter|
|Amess, David||Body, Sir Richard|
|Amos, Alan||Bonsor, Sir Nicholas|
|Arbuthnot, James||Bottomley, Peter|
|Arnold, Jacques (Gravesham)||Bottomley, Mrs Virginia|
|Arnold, Tom (Hazel Grove)||Bowden, Gerald (Dulwich)|
|Ashby, David||Bowis, John|
|Aspinwall, Jack||Boyson, Rt Hon Dr Sir Rhodes|
|Atkins, Robert||Braine, Rt Hon Sir Bernard|
|Atkinson, David||Brandon-Bravo, Martin|
|Baker, Rt Hon K. (Mole Valley)||Brazier, Julian|
|Baker, Nicholas (Dorset N)||Bright, Graham|
|Baldry, Tony||Brittan, Rt Hon Leon|
|Batiste, Spencer||Brooke, Rt Hon Peter|
|Beaumont-Dark, Anthony||Brown, Michael (Brigg & Cl't's)|
|Bellingham, Henry||Buchanan-Smith, Rt Hon Alick|
|Bendall, Vivian||Burns, Simon|
|Burt, Alistair||Hargreaves, Ken (Hyndburn)|
|Butcher, John||Harris, David|
|Butler, Chris||Haselhurst, Alan|
|Butterfill, John||Hawkins, Christopher|
|Carlisle, John, (Luton N)||Hayes, Jerry|
|Carlisle, Kenneth (Lincoln)||Hayhoe, Rt Hon Sir Barney|
|Carrington, Matthew||Hayward, Robert|
|Carttiss, Michael||Heathcoat-Amory, David|
|Chalker, Rt Hon Mrs Lynda||Heddle, John|
|Channon, Rt Hon Paul||Heseltine, Rt Hon Michael|
|Chapman, Sydney||Hicks, Mrs Maureen (Wolv' NE)|
|Chope, Christopher||Hicks, Robert (Cornwall SE)|
|Churchill, Mr||Higgins, Rt Hon Terence L.|
|Clark, Hon Alan (Plym'th S'n)||Hill, James|
|Clark, Dr Michael (Rochford)||Hind, Kenneth|
|Clark, Sir W. (Croydon S)||Hogg, Hon Douglas (Gr'th'm)|
|Clarke, Rt Hon K. (Rushcliffe)||Holt, Richard|
|Colvin, Michael||Hordern, Sir Peter|
|Conway, Derek||Howard, Michael|
|Coombs, Anthony (Wyre F'rest)||Howarth, Alan (Strat'd-on-A)|
|Coombs, Simon (Swindon)||Howarth, G. (Cannock & B'wd)|
|Cope, John||Howe, Rt Hon Sir Geoffrey|
|Cormack, Patrick||Howell, Ralph (North Norfolk)|
|Couchman, James||Hughes, Robert G. (Harrow W)|
|Cran, James||Hunt, David (Wirral W)|
|Critchley, Julian||Hunt, John (Ravensbourne)|
|Currie, Mrs Edwina||Hunter, Andrew|
|Davies, Q. (Stamf'd & Spald'g)||Hurd, Rt Hon Douglas|
|Davis, David (Boothterry)||Irvine, Michael|
|Day, Stephen||Jack, Michael|
|Devlin, Tim||Janman, Tim|
|Dickens, Geoffrey||Jessel, Toby|
|Dorrell, Stephen||Johnson Smith, Sir Geoffrey|
|Douglas-Hamilton, Lord James||Jones, Gwilym (Cardiff N)|
|Dover, Den||Jones, Robert B (Herts W)|
|Dunn, Bob||Kellett-Bowman, Dame Elaine|
|Durant, Tony||Key, Robert|
|Dykes, Hugh||King, Roger (B'ham N'thfield)|
|Eggar, Tim||King, Rt Hon Tom (Bridgwater)|
|Evans, David (Welwyn Hatf'd)||Kirkhope, Timothy|
|Evennett, David||Knapman, Roger|
|Fallon, Michael||Knight, Greg (Derby North)|
|Farr, Sir John||Knight, Dame Jill (Edgbaston)|
|Favell, Tony||Knowles, Michael|
|Fenner, Dame Peggy||Knox, David|
|Field, Barry (Isle of Wight)||Lamont, Rt Hon Norman|
|Finsberg, Sir Geoffrey||Lang, Ian|
|Forman, Nigel||Latham, Michael|
|Forsyth, Michael (Stirling)||Lawson, Rt Hon Nigel|
|Forth, Eric||Lee, John (Pendle)|
|Fowler, Rt Hon Norman||Leigh, Edward (Gainsbor'gh)|
|Fox, Sir Marcus||Lennox-Boyd, Hon Mark|
|Franks, Cecil||Lightbown, David|
|Freeman, Roger||Lilley, Peter|
|French, Douglas||Lloyd, Sir Ian (Havant)|
|Fry, Peter||Lloyd, Peter (Fareham)|
|Gale, Roger||Lord, Michael|
|Gardiner, George||Luce, Rt Hon Richard|
|Gill, Christopher||Lyell, Sir Nicholas|
|Gilmour, Rt Hon Sir Ian||McCrindle, Robert|
|Goodhart, Sir Philip||Macfarlane, Sir Neil|
|Goodlad, Alastair||MacGregor, Rt Hon John|
|Goodson-Wickes, Dr Charles||MacKay, Andrew (E Berkshire)|
|Gorman, Mrs Teresa||Maclean, David|
|Gow, Ian||McLoughlin, Patrick|
|Gower, Sir Raymond||McNair-Wilson, M. (Newbury)|
|Grant, Sir Anthony (CambsSW)||McNair-Wilson, P. (New Forest)|
|Greenway, Harry (Ealing N)||Madel, David|
|Greenway, John (Ryedale)||Major, Rt Hon John|
|Gregory, Conal||Matins, Humfrey|
|Griffiths, Sir Eldon (Bury St E')||Mans, Keith|
|Griffiths, Peter (Portsmouth N)||Maples, John|
|Grist, Ian||Marlow, Tony|
|Ground, Patrick||Marshall, John (Hendon S)|
|Grylls, Michael||Marshall, Michael (Arundel)|
|Hamilton, Hon Archie (Epsom)||Martin, David (Portsmouth S)|
|Hamilton, Neil (Tatton)||Mates, Michael|
|Hanley, Jeremy||Maude, Hon Francis|
|Hannam, John||May hew, Rt Hon Sir Patrick|
|Hargreaves, A. (B'ham H'll Gr')||Mellor, David|
|Meyer, Sir Anthony||Smith, Tim (Beaconsfield)|
|Miller, Hal||Soames, Hon Nicholas|
|Mills, Iain||Speed, Keith|
|Mitchell, Andrew (Gedling)||Speller, Tony|
|Mitchell, David (Hants NW)||Spicer, Sir Jim (Dorset W)|
|Moate, Roger||Squire, Robin|
|Monro, Sir Hector||Stanbrook, Ivor|
|Montgomery, Sir Fergus||Stanley, Rt Hon John|
|Moore, Rt Hon John||Steen, Anthony|
|Morris, M (N'hampton S)||Stern, Michael|
|Morrison, Hon Sir Charles||Stevens, Lewis|
|Moss, Malcolm||Stewart, Allan (Eastwood)|
|Moynihan, Hon Colin||Stewart, Andy (Sherwood)|
|Neale, Gerrard||Stewart, Ian (Hertfordshire N)|
|Needham, Richard||Stokes, John|
|Nelson, Anthony||Stradling Thomas, Sir John|
|Neubert, Michael||Sumberg, David|
|Newton, Rt Hon Tony||Summerson, Hugo|
|Nicholls, Patrick||Tapsell, Sir Peter|
|Nicholson, David (Taunton)||Taylor, John M (Solihull)|
|Nicholson, Emma (Devon West)||Taylor, Teddy (S'end E)|
|Onslow, Rt Hon Cranley||Tebbit, Rt Hon Norman|
|Oppenheim, Phillip||Thatcher, Rt Hon Margaret|
|Page, Richard||Thompson, D. (Calder Valley)|
|Paice, James||Thompson, Patrick (Norwich N)|
|Parkinson, Rt Hon Cecil||Thorne, Neil|
|Patnick, Irvine||Thornton, Malcolm|
|Patten, John (Oxford W)||Thurnham, Peter|
|Pattie, Rt Hon Sir Geoffrey||Townend, John (Bridlington)|
|Porter, David (Waveney)||Townsend, Cyril D. (B'heath)|
|Portillo, Michael||Tracey, Richard|
|Powell, William (Corby)||Tredinnick, David|
|Price, Sir David||Trippier, David|
|Raffan, Keith||Trotter, Neville|
|Raison, Rt Hon Timothy||Twinn, Dr Ian|
|Redwood, John||Vaughan, Sir Gerard|
|Renton, Tim||Viggers, Peter|
|Rhodes James, Robert||Waddington, Rt Hon David|
|Riddick, Graham||Wakeham, Rt Hon John|
|Ridley, Rt Hon Nicholas||Waldegrave, Hon William|
|Ridsdale, Sir Julian||Walden, George|
|Rifkind, Rt Hon Malcolm||Walker, Bill (T'side North)|
|Roberts, Wyn (Conwy)||Walker, Rt Hon P. (W'cester)|
|Roe, Mrs Marion||Waller, Gary|
|Rossi, Sir Hugh||Walters, Dennis|
|Rost, Peter||Ward, John|
|Rowe, Andrew||Wardle, Charles (Bexhill)|
|Rumbold, Mrs Angela||Watts, John|
|Ryder, Richard||Wheeler, John|
|Sackville, Hon Tom||Whitney, Ray|
|Sainsbury, Hon Tim||Widdecombe, Ann|
|Sayeed, Jonathan||Wilkinson, John|
|Scott, Nicholas||Wilshire, David|
|Shaw, David (Dover)||Winterton, Nicholas|
|Shaw, Sir Giles (Pudsey)||Wolfson, Mark|
|Shaw, Sir Michael (Scarb')||Wood, Timothy|
|Shephard, Mrs G. (Norfolk SW)||Woodcock, Mike|
|Shepherd, Colin (Hereford)||Young, Sir George (Acton)|
|Shepherd, Richard (Aldridge)|
|Shersby, Michael||Tellers for the Noes:|
|Sims, Roger||Mr. Robert Boscawen and Mr. Tristan Garel-Jones.|
|Skeet, Sir Trevor|
§ Question accordingly negatived.
§ Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments):—
§ The House divided: Ayes 317, Noes 220.406
|Division No. 279]||[7.12 pm|
|Adley, Robert||Arbuthnot, James|
|Aitken, Jonathan||Arnold, Jacques (Gravesham)|
|Alexander, Richard||Arnold, Tom (Hazel Grove)|
|Alison, Rt Hon Michael||Ashby, David|
|Allason, Rupert||Aspinwall, Jack|
|Amery, Rt Hon Julian||Atkins, Robert|
|Amess, David||Atkinson, David|
|Amos, Alan||Baker, Rt Hon K. (Mole Valley)|
|Baker, Nicholas (Dorset N)||Franks, Cecil|
|Baldry, Tony||Freeman, Roger|
|Batiste, Spencer||French, Douglas|
|Beaumont-Dark, Anthony||Fry, Peter|
|Bellingham, Henry||Gale, Roger|
|Bendall, Vivian||Gardiner, George|
|Bennett, Nicholas (Pembroke)||Gill, Christopher|
|Benyon, W.||Gilmour, Rt Hon Sir Ian|
|Bevan, David Gilroy||Goodhart, Sir Philip|
|Biggs-Davison, Sir John||Goodlad, Alastair|
|Blackburn, Dr John G.||Goodson-Wickes, Dr Charles|
|Blaker, Rt Hon Sir Peter||Gorman, Mrs Teresa|
|Body, Sir Richard||Gow, Ian|
|Bonsor, Sir Nicholas||Gower, Sir Raymond|
|Bottomley, Peter||Grant, Sir Anthony (CambsSW)|
|Bottomley, Mrs Virginia||Greenway, Harry (Ealing N)|
|Bowden, Gerald (Dulwich)||Greenway, John (Ryedale)|
|Bowis, John||Gregory, Conal|
|Boyson, Rt Hon Dr Sir Rhodes||Griffiths, Sir Eldon (Bury St E')|
|Braine, Rt Hon Sir Bernard||Griffiths, Peter (Portsmouth N)|
|Brandon-Bravo, Martin||Grist, Ian|
|Brazier, Julian||Ground, Patrick|
|Bright, Graham||Grylls, Michael|
|Brittan, Rt Hon Leon||Hamilton, Hon Archie (Epsom)|
|Brooke, Rt Hon Peter||Hamilton, Neil (Tatton)|
|Brown, Michael (Brigg & Cl't's)||Hanley, Jeremy|
|Buchanan-Smith, Rt Hon Alick||Hannam, John|
|Budgen, Nicholas||Hargreaves, A. (B'ham H'll Gr')|
|Burns, Simon||Hargreaves, Ken (Hyndburn)|
|Burt, Alistair||Harris, David|
|Butcher, John||Haselhurst, Alan|
|Butler, Chris||Hawkins, Christopher|
|Butterfill, John||Hayes, Jerry|
|Carlisle, John, (Luton N)||Hayhoe, Rt Hon Sir Barney|
|Carlisle, Kenneth (Lincoln)||Hayward, Robert|
|Carrington, Matthew||Heathcoat-Amory, David|
|Carttiss, Michael||Heddle, John|
|Chalker, Rt Hon Mrs Lynda||Heseltine, Rt Hon Michael|
|Channon, Rt Hon Paul||Hicks, Mrs Maureen (Wolv' NE)|
|Chapman, Sydney||Hicks, Robert (Cornwall SE)|
|Chope, Christopher||Higgins, Rt Hon Terence L.|
|Churchill, Mr||Hill, James|
|Clark, Hon Alan (Plym'th S'n)||Hind, Kenneth|
|Clark, Dr Michael (Rochford)||Hogg, Hon Douglas (Gr'th'm)|
|Clark, Sir W. (Croydon S)||Holt, Richard|
|Clarke, Rt Hon K. (Rushcliffe)||Hordern, Sir Peter|
|Colvin, Michael||Howard, Michael|
|Conway, Derek||Howarth, Alan (Strat'd-on-A)|
|Coombs, Anthony (Wyre F'rest)||Howarth, G. (Cannock & B'wd)|
|Coombs, Simon (Swindon)||Howe, Rt Hon Sir Geoffrey|
|Cope, John||Howell, Ralph (North Norfolk)|
|Cormack, Patrick||Hughes, Robert G. (Harrow W)|
|Couchman, James||Hunt, David (Wirral W)|
|Cran, James||Hunt, John (Ravensbourne)|
|Critchley, Julian||Hunter, Andrew|
|Currie, Mrs Edwina||Hurd, Rt Hon Douglas|
|Davies, Q. (Stamf'd & Spald'g)||Irvine, Michael|
|Davis, David (Boothferry)||Jack, Michael|
|Day, Stephen||Janman, Tim|
|Devlin, Tim||Jessel, Toby|
|Dorrell, Stephen||Johnson Smith, Sir Geoffrey|
|Douglas-Hamilton, Lord James||Jones, Gwilym (Cardiff N)|
|Dover, Den||Jones, Robert B (Herts W)|
|Dunn, Bob||Kellett-Bowman, Dame Elaine|
|Durant, Tony||Key, Robert|
|Dykes, Hugh||King, Roger (B'ham N'thfield)|
|Eggar, Tim||King, Rt Hon Tom (Bridgwater)|
|Evans, David (Welwyn Hatf'd)||Kirkhope, Timothy|
|Evennett, David||Knapman, Roger|
|Fallon, Michael||Knight, Greg (Derby North)|
|Farr, Sir John||Knight, Dame Jill (Edgbaston)|
|Favell, Tony||Knowles, Michael|
|Fenner, Dame Peggy||Knox, David|
|Field, Barry (Isle of Wight)||Lamont, Rt Hon Norman|
|Finsberg, Sir Geoffrey||Lang, Ian|
|Forman, Nigel||Latham, Michael|
|Forsyth, Michael (Stirling)||Lawson, Rt Hon Nigel|
|Forth, Eric||Lee, John (Pendle)|
|Fowler, Rt Hon Norman||Lennox-Boyd, Hon Mark|
|Fox, Sir Marcus||Lightbown, David|
|Lilley, Peter||Ryder, Richard|
|Lloyd, Sir Ian (Havant)||Sackville, Hon Tom|
|Lloyd, Peter (Fareham)||Sainsbury, Hon Tim|
|Lord, Michael||Sayeed, Jonathan|
|Luce, Rt Hon Richard||Scott, Nicholas|
|Lyell, Sir Nicholas||Shaw, David (Dover)|
|Macfarlane, Sir Neil||Shaw, Sir Giles (Pudsey)|
|MacGregor, Rt Hon John||Shaw, Sir Michael (Scarb')|
|MacKay, Andrew (E Berkshire)||Shephard, Mrs G. (Norfolk SW)|
|Maclean, David||Shepherd, Colin (Hereford)|
|McLoughlin, Patrick||Shepherd, Richard (Aldridge)|
|McNair-Wilson, M. (Newbury)||Shersby, Michael|
|McNair-Wilson, P. (New Forest)||Sims, Roger|
|Madel, David||Skeet, Sir Trevor|
|Major, Rt Hon John||Smith, Tim (Beaconsfield)|
|Malins, Humfrey||Soames, Hon Nicholas|
|Mans, Keith||Speed, Keith|
|Maples, John||Speller, Tony|
|Marlow, Tony||Spicer, Sir Jim (Dorset W)|
|Marshall, John (Hendon S)||Squire, Robin|
|Marshall, Michael (Arundel)||Stanbrook, Ivor|
|Martin, David (Portsmouth S)||Stanley, Rt Hon John|
|Mates, Michael||Steen, Anthony|
|Maude, Hon Francis||Stern, Michael|
|Mayhew, Rt Hon Sir Patrick||Stevens, Lewis|
|Mellor, David||Stewart, Allan (Eastwood)|
|Meyer, Sir Anthony||Stewart, Andy (Sherwood)|
|Miller, Hal||Stewart, Ian (Hertfordshire N)|
|Mills, Iain||Stokes, John|
|Mitchell, Andrew (Gedling)||Stradling Thomas, Sir John|
|Mitchell, David (Hants NW)||Sumberg, David|
|Moate, Roger||Summerson, Hugo|
|Monro, Sir Hector||Tapsell, Sir Peter|
|Montgomery, Sir Fergus||Taylor, Teddy (S'end E)|
|Moore, Rt Hon John||Tebbit, Rt Hon Norman|
|Morris, M (N'hampton S)||Thatcher, Rt Hon Margaret|
|Morrison, Hon Sir Charles||Thompson, D. (Calder Valley)|
|Moss, Malcolm||Thompson, Patrick (Norwich N)|
|Moynihan, Hon Colin||Thorne, Neil|
|Neale, Gerrard||Thornton, Malcolm|
|Needham, Richard||Thurnham, Peter|
|Nelson, Anthony||Townend, John (Bridlington)|
|Neubert, Michael||Townsend, Cyril D. (B'heath)|
|Newton, Rt Hon Tony||Tracey, Richard|
|Nicholls, Patrick||Tredinnick, David|
|Nicholson, David (Taunton)||Trippier, David|
|Nicholson, Emma (Devon West)||Trotter, Neville|
|Onslow, Rt Hon Cranley||Viggers, Peter|
|Oppenheim, Phillip||Waddington, Rt Hon David|
|Page, Richard||Wakeham, Rt Hon John|
|Paice, James||Waldegrave, Hon William|
|Parkinson, Rt Hon Cecil||Walden, George|
|Patnick, Irvine||Walker, Bill (T'side North)|
|Patten, John (Oxford W)||Walker, Rt Hon P. (W'cester)|
|Pattie, Rt Hon Sir Geoffrey||Waller, Gary|
|Porter, David (Waveney)||Ward, John|
|Portillo, Michael||Wardle, Charles (Bexhill)|
|Powell, William (Corby)||Watts, John|
|Price, Sir David||Wheeler, John|
|Raffan, Keith||Whitney, Ray|
|Raison, Rt Hon Timothy||Widdecombe, Ann|
|Redwood, John||Wilkinson, John|
|Renton, Tim||Wilshire, David|
|Rhodes James, Robert||Winterton, Nicholas|
|Riddick, Graham||Wolfson, Mark|
|Ridley, Rt Hon Nicholas||Wood, Timothy|
|Ridsdale, Sir Julian||Woodcock, Mike|
|Rifkind, Rt Hon Malcolm||Young, Sir George (Acton)|
|Roberts, Wyn (Conwy)|
|Roe, Mrs Marion||Tellers for the Ayes:|
|Rossi, Sir Hugh||Mr. Robert Boscawen and Mr. Tristan Garel-Jones.|
|Rumbold, Mrs Angela|
|Abbott, Ms Diane||Archer, Rt Hon Peter|
|Adams, Allen (Paisley N)||Armstrong, Hilary|
|Allen, Graham||Ashley, Rt Hon Jack|
|Alton, David||Banks, Tony (Newham NW)|
|Anderson, Donald||Barnes, Harry (Derbyshire NE)|
|Barnes, Mrs Rosie (Greenwich)||Fields, Terry (L'pool B G'n)|
|Barron, Kevin||Fisher, Mark|
|Battle, John||Flannery, Martin|
|Beckett, Margaret||Foot, Rt Hon Michael|
|Beggs, Roy||Foster, Derek|
|Bell, Stuart||Foulkes, George|
|Benn, Rt Hon Tony||Fraser, John|
|Bennett, A. F. (D'nt'n & R'dish)||Fyfe, Maria|
|Bermingham, Gerald||Galloway, George|
|Bidwell, Sydney||Garrett, John (Norwich South)|
|Blair, Tony||Garrett, Ted (Wallsend)|
|Blunkett, David||George. Bruce|
|Boateng, Paul||Golding, Mrs Llin|
|Boyes, Roland||Gordon, Mildred|
|Bradley, Keith||Gould, Bryan|
|Bray, Dr Jeremy||Graham, Thomas|
|Brown, Gordon (D'mline E)||Grant, Bernie (Tottenham)|
|Brown, Nicholas (Newcastle E)||Griffiths, Nigel (Edinburgh S)|
|Buchan, Norman||Griffiths, Win (Bridgend)|
|Buckley, George J.||Grocott, Bruce|
|Caborn, Richard||Hardy, Peter|
|Callaghan, Jim||Hattersley, Rt Hon Roy|
|Campbell, Menzies (Fife NE)||Heffer, Eric S.|
|Campbell, Ron (Blyth Valley)||Henderson, Doug|
|Campbell-Savours, D. N.||Hinchliffe, David|
|Cartwright, John||Hogg, N. (C'nauld & Kilsyth)|
|Clark, Dr David (S Shields)||Holland, Stuart|
|Clarke, Tom (Monklands W)||Home Robertson, John|
|Clay, Bob||Howarth, George (Knowsley N)|
|Clelland, David||Howell, Rt Hon D. (S'heath)|
|Clwyd, Mrs Ann||Hoyle, Doug|
|Cohen, Harry||Hughes, John (Coventry NE)|
|Coleman, Donald||Hughes, Robert (Aberdeen N)|
|Cook, Robin (Livingston)||Hughes, Roy (Newport E)|
|Corbett, Robin||Hughes, Sean (Knowsley S)|
|Corbyn, Jeremy||Hume, John|
|Cousins, Jim||Illsley, Eric|
|Cox, Tom||Ingram, Adam|
|Cryer, Bob||Janner, Greville|
|Cummings, John||John, Brynmor|
|Cunliffe, Lawrence||Johnston, Sir Russell|
|Cunningham, Dr John||Jones, Barry (Alyn & Deeside)|
|Darling, Alistair||Kaufman, Rt Hon Gerald|
|Davies, Rt Hon Denzil (Llanelli)||Kennedy, Charles|
|Davies, Ron (Caerphilly)||Kilfedder, James|
|Davis, Terry (B'ham Hodge H'I)||Kinnock, Rt Hon Neil|
|Dewar, Donald||Kirkwood, Archy|
|Dixon, Don||Lambie, David|
|Dobson, Frank||Leadbitter, Ted|
|Doran, Frank||Leighton, Ron|
|Douglas, Dick||Lestor, Joan (Eccles)|
|Duffy, A. E. P.||Lewis, Terry|
|Dunnachie, Jimmy||Litherland, Robert|
|Dunwoody, Hon Mrs Gwyneth||Livingstone, Ken|
|Eadie, Alexander||Livsey, Richard|
|Evans, John (St Helens N)||Lloyd, Tony (Stretford)|
|Ewing, Harry (Falkirk E)||Lofthouse, Geoffrey|
|Ewing, Mrs Margaret (Moray)||Loyden, Eddie|
|Faulds, Andrew||McAllion, John|
|Field, Frank (Birkenhead)||McAvoy, Thomas|
|McCusker, Harold||Richardson, Jo|
|McFall, John||Roberts, Allan (Bootle)|
|McGrady, Eddie||Robertson, George|
|McKay, Allen (Barnsley West)||Rogers, Allan|
|McKelvey, William||Rooker, Jeff|
|McLeish, Henry||Ross, Ernie (Dundee W)|
|McNamara, Kevin||Ross, William (Londonderry E)|
|McTaggart, Bob||Rowlands, Ted|
|McWilliam, John||Ruddock, Joan|
|Madden, Max||Sedgemore, Brian|
|Mahon, Mrs Alice||Sheerman, Barry|
|Mallon, Seamus||Sheldon, Rt Hon Robert|
|Marek, Dr John||Short, Clare|
|Marshall, David (Shettleston)||Skinner, Dennis|
|Martin, Michael J. (Springburn)||Smith, Andrew (Oxford E)|
|Maxton, John||Smith, C. (Isl'ton & F'bury)|
|Meacher, Michael||Smith, Rt Hon J. (Monk'ds E)|
|Meale, Alan||Smyth, Rev Martin (Belfast S)|
|Michael, Alun||Snape, Peter|
|Michie, Bill (Sheffield Heeley)||Soley, Clive|
|Michie, Mrs Ray (Arg'l & Bute)||Spearing, Nigel|
|Millan, Rt Hon Bruce||Steel, Rt Hon David|
|Mitchell, Austin (G't Grimsby)||Steinberg, Gerry|
|Molyneaux, Rt Hon James||Stott, Roger|
|Moonie, Dr Lewis||Straw, Jack|
|Morgan, Rhodri||Taylor, Mrs Ann (Dewsbury)|
|Morris, Rt Hon A. (W'shawe)||Thompson, Jack (Wansbeck)|
|Morris, Rt Hon J. (Aberavon)||Turner, Dennis|
|Mowlam, Marjorie||Vaz, Keith|
|Mullin, Chris||Wall, Pat|
|Murphy, Paul||Wallace, James|
|Nellist, Dave||Walley, Joan|
|Oakes, Rt Hon Gordon||Wardell, Gareth (Gower)|
|O'Brien, William||Wareing, Robert N.|
|Orme, Rt Hon Stanley||Welsh, Andrew (Angus E)|
|Parry, Robert||Welsh, Michael (Doncaster N)|
|Patchett, Terry||Williams, Alan W. (Carm'then)|
|Pendry, Tom||Wilson, Brian|
|Pike, Peter L.||Winnick, David|
|Powell, Ray (Ogmore)||Wise, Mrs Audrey|
|Prescott, John||Worthington, Tony|
|Primarolo, Dawn||Wray, Jimmy|
|Quin, Ms Joyce||Young, David (Bolton SE)|
|Redmond, Martin||Tellers for the Noes:|
|Rees, Rt Hon Merlyn||Mr. Frank Cook and Mr. Ken Eastham.|
|Reid, Dr John|
§ Question accordingly agreed to.
§ MR. SPEAKER forthwith declared the main Question, as amended, to be agreed to.
That this House, recognising that social security spending has risen by nearly 40 per cent. in real terms since 1979, and now totals almost £48½ billion, and that spending on housing benefit last year amounted to over £5 billion and went to over 7 million, or 1 in 3, households in this country, commends Her Majesty's Government for its determination to tackle the complexities and unfairnesses of the old system.