§ 11. Sir Trevor SkeetTo ask the Secretary of State for Social Security what is the current value of the assets held by the average pensioner household; and what was the comparable position in real terms in 1978–79.
§ Miss WiddecombeMy hon. Friend will be pleased to hear that we estimate that the average real value of pensioners' assets doubled between 1979 and 1987.
§ Sir Trevor SkeetI am grateful to my hon. Friend for that beneficial answer. Will she make a comparison with France and Germany, where house ownership is less extensive than in the United Kingdom? Will she also deal with the poorer section of the United Kingdom, 11 principally those who are over 70, because, although their gross income is considerable, their special circumstances mean that they come off rather badly?
§ Miss WiddecombeAs I said in a reply a short while ago, we are aware of the need to target pensioners with special needs, particularly those in an age group in which they could not take advantage of occupational pension schemes. We also wish to target those whose savings were completely destroyed by high inflation during the Labour Administration of the 1970s. In comparison with Europe, we come out well on pensions. A far higher number of pensioners own homes and other assets than is generally the case in the rest of Europe.
§ Mr. Campbell-SavoursIs it not true that, as a result of the Government's policy of paying low pensions, pensioners want higher and higher interest rates? Is it not incongruous that pensioners' interests are the direct reverse of the interests of the Government's economic strategy?
§ Miss WiddecombeAs the value of pensioners' income has risen 31 per cent. under this Government, it is a little extraordinary to talk about low pensions. Pensions have kept pace with inflation and we have kept our promises to pensioners to ensure that the value of their benefits is preserved. However, we have encouraged a great deal of other pensioners' income, such as occupational pensions and personal pensions. We believe that through that encouragement, pensioners are now able better to provide for themselves while we concentrate on those who cannot do so. Only certain forms of savings will be wholly dependent on high interest rates, which are not in the general interest of the economy. I do not believe that pensioners in the hon. Gentleman's constituency would, in general, want high interest rates.
§ Mr. David ShawDoes my hon. Friend agree that the increased number of pensioners owning homes and other assets has resulted in more pensioners being able to live off their savings in recent years than there were in 1979? Page 18 of the social security expenditure report shows that, in 1979, there was 20 per cent. more reliance by pensioners living off their earnings, with the result that many of them were probably unable to retire.
§ Miss WiddecombeMy hon. Friend's analysis is right. We have already heard that the value of savings has doubled. The value of income has gone up by 31 per cent. Savings take many forms and the rapid growth in occupational pensions and in the greater provision that pensioners can make for themselves allows them to retire. That is why there are now more retirements at an earlier age and less pressure on people to continue to work, than under the Labour Government of the 1970s.