Pensioners (Hansard, 17 December 1990)

§ 4. Mr. Janman
To ask the Secretary of State for Social Security what extra support has been directed to lower-income pensioners in the last two years.

§ The Parliamentary Under-Secretary of State for Social Security (Miss Ann Widdecombe)
Income-related benefits for pensioners have been increased substantially over the past two years. In addition to the normal annual upratings we directed an extra £200 million to less well-off elderly and disabled pensioners in October 1989 and will be directing an extra £80 million to pensioners aged 60 to 74 5 from next April. Taken together, those increases will bring the total annual extra help for pensioners since October 1989 to over a quarter of a billion pounds.

§ Mr. Janman
May I warmly welcome my hon. Friend to the Government Front Bench? She and I have had offices near to each other for the past three years.
May I congratulate my hon. Friend on her answer to my question? She will be well aware that there are some, including some Labour Members, who often try to imply that the United Kingdom is rather behind its European neighbours when it comes to support for the elderly. Will my hon. Friend confirm that that is far from the truth and that Britain is near the top of the league when it comes to supporting its elderly in terms of the percentage of public expenditure that is spent in that direction? Does my hon. Friend agree that any massive across-the-board increase, as proposed by the likes of the Pensioners Protection party, would not reach those who need help the most because of the loss of benefit entitlement that would occur if such a policy were pursued?

§ Miss Widdecombe
I thank my hon. Friend for his generous welcome. The real Pensioners Protection party is the party that has brought about a 31 per cent. growth in pensioners' income during its time in office. The European figures clearly demonstrate that the richer countries spend a larger share of national income on social protection. That underlines the Government's view that only a successful economy can generate the wealth to pay for the welfare state. There are aspects of the pension arrangements in other EEC countries that we would not welcome, such as the link with earnings, which means that low earners receive low pensions.

§ Mr. Winnick
Pensioners, and especially pensioner couples, have been cheated out of £20 a week because of the break in the link with earnings. Is the Minister aware of our deep concern about the health of so many poor pensioners who, at this very moment, are in great danger because they simply do not have sufficient financial means to heat their homes to an adequate level? Do not the Minister and the Secretary of State realise that the cold weather payment regulations are far too inflexible and bureaucratic? Is not it absolutely scandalous that millions of pensioners on small incomes are forced to live in inadequately heated homes because they are denied any extra help from the Government? When will the Government take action on that?

§ Miss Widdecombe
It is because we recognise the importance of pensioners—and, indeed, others—being able to heat their homes adequately that there have been many reviews of cold weather payments. We made improvements in the winters of both 1988–89 and 1989–90. We are now having further consultations with the Meteorological Office about weather station areas because there are local variations that need to be examined.

§ Mr. Winnick
What a farce.

§ Mr. Speaker
Order.

§ Miss Widdecombe
I cannot believe that those who are trying to heat their homes in some of the areas most severely affected would share the amusement of the hon. Member for Walsall, North (Mr. Winnick) about that process.

§ Mr. Winnick
It is not amusement. I am furious.

§ Mr. Speaker
Order.

§ Mr. Andrew Mitchell
Has my hon. Friend noted that next year all pensioners will receive a rise in their pensions in excess of the current level of inflation, and which by next April will be substantially in excess of inflation? Will not that be of great advantage to all pensioners, and especially those on lower incomes?

§ Miss Widdecombe
That rise, together with the uprating in income support, our review of cold weather payments and other measures, shows clearly that we are directing our resources to pensioners most in need. They will certainly benefit from the uprating—

§ Mr. Winnick
On a point of order, Mr. Speaker. If an hon. Member is described by the sort of term that one hon. Member has just used to describe me, should not that hon. Member be forced to withdraw?

§ Mr. Speaker
I did not hear anything disorderly.

§ Ms. Short
I also welcome—

§ Mr. Ron Davies
Further to that point of order, Mr. Speaker. I assure you that we all clearly heard the hon. Member for Gravesham (Mr. Arnold) refer to my hon. Friend the Member for Walsall, North (Mr. Winnick) as a rat. Will you confirm that that is an unparliamentary expression—

§ Mr. Speaker
Order. Did the hon. Member for Gravesham (Mr. Arnold) call the hon. Member for Walsall, North (Mr. Winnick) a rat?

§ Mr. Jacques Arnold
I made no such reference.

§ Mr. Speaker
I did not hear it.

§ Mr. Paice
Further to that point of order, Mr. Speaker. In order that the proceedings may continue, I withdraw the remark that you did not hear.

§ Ms. Short
I welcome the Minister to the Dispatch Box. As we shall be seeing rather more of each other now, I hope that she will manage to say something with which I can agree.
Will the hon. Lady confirm that the figures that she cited do not in any way make up for the massive cut in the value of pensions that the Government imposed when. they broke the link with earnings'? As my hon. Friend the Member for Walsall, North (Mr. Winnick) said, that amounts to £12 a week for a single pensioner and £20 a week for a pensioner couple. Is she aware that that is causing real hardship for many pensioners? Is she further aware that Labour is committed to restoring that link and to an immediate increase, in addition to the uprating, of £5 a week for a single pensioner and £8 a week for a pensioner couple?

§ Miss Widdecombe
Perhaps the House should be aware that the costs of restoring that link—about £6 billion—mean that the average employee would face an extra £2.78 on his national insurance contributions and his employer an extra £5.34. Before we believe that the restoration of a link with earnings would substantially improve a pensioner's lot, perhaps we should reflect on the fact that the Labour Government linked pensions with earnings and brought about a 20 per cent. increase, which was 7 eroded to a mere 3 per cent. increase because of their other policies. Surely it is better to have a 31 per cent. increase in real terms than a 3 per cent. increase against a totally false base.

§ Mr. Brazier
May I also extend a warm welcome to my hon. Friend at the Dispatch Box? I very much enjoyed campaigning with her on many issues. In supporting her view that the Government have a much better record than their predecessor in looking after less well-off pensioners, may I draw her attention to the plight of one particular group—pensioners who are on modest incomes but also have savings? I suggest that, although the increase in capital limits was welcome, so long as we have a concept of notional income, we shall have a marginal rate of benefit withdrawal that makes saving unattractive to people approaching retirement.

§ Miss Widdecombe
I thank my hon. Friend for his warm welcome. Although I have some sympathy with his concerns, I should point out to him that, through the notional tariff and taper, those with very small savings benefit. It would be difficult to persuade those with little savings and little income that it was right or socially equitable to exempt large savings completely.