Pensioners (Savings) (Hansard, 15 April 1991)

§ 3. Mr. Stern
To ask the Secretary of State for Social Security what percentage of pensioners retiring (a) in 1979 and (b) in 1987 had incomes from savings; and what was the real average level of savings on each of those two dates.

§ The Parliamentary Under-Secretary of State for Social Security (Miss Ann Widdecombe)
My hon. Friend will be pleased to hear that, in 1987, 75 per cent. of recently retired pensioners had income from savings compared with only 65 per cent. in 1979. The average real level of savings for this group was about four times as high in 1987 as it had been in 1979.

§ Mr. Stern
I congratulate my hon. Friend on that announcement, which confirms the very real increase in the standard of living of pensioners over the past decade. Does my hon. Friend agree that perhaps the greatest danger to the record figures that she announced would be a resurgence of double-figure inflation of the type experienced under the last Labour Government? Does she further agree that the greatest threat of such inflation comes from the grandiose spending plans of the Labour party?

§ Miss Widdecombe
My hon. Friend is absolutely right and one need only look at the record of the last Labour Government to see how right he is. During their time in office, pensioners' average income from savings fell by 16 per cent., which was the equivalent of about 3.4 per cent. each year. By comparison, under this Government, pensioners' average income from savings has increased by 130 per cent.

§ Mr. Andrew F. Bennett
If the Government are claiming credit for those figures, will they also take responsibility for blighting the lives of many of the pensioners in my constituency who have been put out of work in the past 10 years because of the previous Government-created recession and have found themselves, at the age of 55 or 56, unable to get other jobs and having to retire on basic benefits with no savings at all? When will the Government compensate people who were asked to sacrifice their jobs for the prosperity of the country?

§ Miss Widdecombe
It is odd that the hon. Gentleman castigates the Government for people retiring on basic state pensions, because the number now retiring with occupational pensions has risen to 77 per cent. in real terms. Therefore, the hon. Gentleman is on weak ground. Pensioners' incomes have increased steadily under this Government, from benefits, occupational pensions and savings. The total increase in income is 31 per cent. The hon. Gentleman should look to the record of the previous Labour Government.

§ Mr. Paice
Does my hon. Friend agree that the lesson to be learnt from the admirable figures that she described to the House, in terms of savings and occupational pensions, is that any extra resources that can be channelled to pensioners should not be dissipated across all pensioners but targeted to those reliant only on state pensions and those most clearly in need of extra income?

§ Miss Widdecombe
My hon. Friend is right and that is why my right hon. Friend the Secretary of State has been targeting help in that fashion. Recently, we announced increases to the value of £200 million in a full year, devoted specifically to less well-off pensioners. From April 1991, a further £80 million has been devoted to exactly that category. My hon. Friend is right that we can do more for poorer pensioners if we specifically target them.

§ Mr. Allen
The Minister will be aware that, because of the increase in pensions paid for the first time last week, married couples under the age of 75 now receive lop more than the income support limit. That means that they will be unable to claim benefits such as free dental inspections, free eye tests, European Community food mountain subsidies which allow pensioners free meat and so on—

§ Mr. Dickens
The gravy train.

§ Mr. Allen
—access to the social fund and cold weather payments. The hon. Member for Littleborough and Saddleworth (Mr. Dickens), who calls that the gravy train, should be ashamed of himself. Did the Government realise that that 10p rise over the income support level would have such an effect? If not, what will they do to help those people?

§ Miss Widdecombe
The hon. Gentleman will be aware that, as a result of that rise in the basic retirement pension for the category of people whom he mentions, the retirement pension has now risen above the level of income support, so they now receive additional resources each week. He should also be aware that such people are still eligible for national health service benefits, as they are for housing and community charge benefits. Their total income should, therefore, not be eroded.