Pensioners (Hansard, 23 October 1989)

§ 2. Mr. Charles Wardle
To ask the Secretary of State for Social Security whether those older and disabled pensioners who benefit from this autumn's special package will lose transitional protection when these increases are introduced.

§ The Secretary of State for Social Security (Mr. Tony Newton)
No. The increased income support pensioner premiums which took effect in the week commencing 9 October were on top of any transitional addition then in payment.

§ Mr. Wardle
The increases that my right hon. Friend has introduced will be welcome, particularly because much of the extra money will go to pensioners who retired before the state earnings-related pension scheme began in 1978, but how have pensioners on the lowest incomes fared by comparison with the average increase in pensioners' incomes in the past decade?

§ Mr. Newton
My hon. Friend is right that the purpose of the changes which have just taken place was to help those who have had the least opportunity to benefit from the improvements in occupational pensions and in SERPS in recent years. The most relevant figure that I can give is that the proportion of pensioners on the lowest 20 per cent. of incomes fell from nearly two fifths in 1979 to less than a quarter in 1986.

§ Mr. Frank Field
If I have understood the Secretary of State correctly, I must congratulate him. Will he spell out to the House that by having no clawback of the increased pensions to the very poorest group, he has made nonsense of the Government's policy of transitional protection? If he is ensuring that this group benefits totally from the additional increase, why do not all pensioners and people on other benefits similarly benefit?

§ Mr. Newton
With all due respect to the hon. Gentleman, we have not made nonsense of anything. We have given up to £3.50 per week extra to more than 2.5 million of the disabled or oldest pensioners.

§ Mr. Favell
Is it not true that there are some very rich pensioners and that it is much more sensible to concentrate on the poorest group than to spread the jam thinly as the Labour party would have us do?

§ Mr. Newton
It is certainly the case that on the latest information available to us the average total net income of pensioners has been rising considerably faster—nearly twice as fast as for the population as a whole. That underlines the success of earlier policies, those aimed at improving especially the position of the newly retired in general. It also reinforces the need to focus our help on older retired people, which is exactly what we have been doing.