Retirement Pension (Hansard, 3 February 1992)

§ 8. Mr. Winnick
To ask the Secretary of State for Social Security what recent representations he has received over the level of the retirement pension.

§ Mr. Newton
We regularly receive representations and inquiries from a wide range of interested organisations and individuals about the level of the retirement pension.

§ Mr. Winnick
Will the Secretary of State take this opportunity to confirm an answer recently given to me by a junior Minister—it is in Hansard, of course—to the effect that a large number of pensioners—nearly 40 per cent.—have incomes of £70 or less out of which they pay about £10 to £15 in rent? Is it not a fact that if the link with earnings had not been broken by his Government 10 years ago—indeed, nearly 12 years ago—a married pensioner would be £28 a week better off this April? That is what the country is concerned about, not the lies, smears and distortions organised by Tory central office and the Tory press against the Labour party.

§ Mr. Newton
Such calculations take absolutely no account of the increased taxation and inflation which would have resulted from the pursuit of the policy that the hon. Gentleman is advocating. I leave with him the thought, especially as Labour is apparently committed to 8 adding another £9 a week to national insurance contributions for 3 million or more people, that if such a policy had been pursued, contributions for an employee on average earnings and his employer would now be about £9 a week more than they are.

§ Mr. Ashby
My right hon. Friend referred to the increase in the incomes of pensioners as a result of savings and of occupational pensions. Can he give any idea of what the level of occupational pensions will be by the turn of the century?

§ Mr. Newton
I will not attempt to predict what will happen on that front between now and the end of the century because that will depend on many factors. I can tell my hon. Friend that pensioners' incomes from occupational pensions—for those who have them—rose on average from £13.90 a week in 1979 to £27.70 in 1988. That is a virtual doubling of the income from occupational pensions over that period. I expect to see the trend continue if sensible policies continue to be pursued.

§ Mr. Meacher
Will the right hon. Gentleman tell us what representations he has received from the employees and pensioners of the Maxwell Communication Corporation and AGB companies about the level of their pensions? Is he aware that, due to his culpable negligence in sitting for 19 months on regulations under the Social Security Act 1990, which would have protected pensioners in the event of a company wind-up, thousands of pensioners now stand to lose most or all of their pensions for which they have contributed for up to 35 years? Does not he think it right that all such pensioners should receive compensation when they have lost so much pension due to his complacency and reprehensible laxity?

§ Mr. Newton
I presume that the hon. Gentleman thought it right to return to the matter in the House having notably failed to achieve the result for which he hoped by an overheated press release to the same effect which he issued at the end of last week. He knows that he has deliberately raised unnecessary alarm among many thousands of pensioners by the way in which he has presented the matter. It is simply not the case that pensioners in such schemes will get nothing or will be left penniless, as the hon. Gentleman well knows. Under existing regulations, if there are not sufficient assets to secure the guaranteed minimum pensions that is the equivalent of what the pensioners would have got under the state earnings-related pension scheme—the guaranteed minimum pensions can be and would be underwritten by the Government.

§ Mr. Ian Taylor
Will my right hon. Friend refuse the invitation from the Opposition to treat pensioners as a political underclass? Will he remember that more and more people reaching retirement age wish to have independence in their own hands, which means that they must be in receipt of policies that encourage that independence, including savings, during their working career?

§ Mr. Newton
That is absolutely right, and nothing has more clearly revealed the Opposition's attitude to people's wishes in the matter than their persistent hostility to the 4 million or more people who have taken out personal pensions for exactly that reason.