HC Deb 20 July 1993 vol 229 cc201-99
Madam Speaker

I have to inform the House that I have selected the amendment standing in the name of the Prime Minister.

3.50 pm
Mr. Donald Dewar (Glasgow, Garscadden)

I beg to move, That this House condemns the social policies of this Government which have resulted in an ever widening gap between the rich and poor, and the destruction of opportunity, and which threaten the security and prosperity of countless individuals and whole communities; and calls upon Her Majesty's Government to abandon plans designed to dismantle the welfare state and to force the vulnerable to pay a high price for the Government's economic failure. The House will be aware that the Government recently produced a survey, covering the period 1979 to 1990–91, of households on below-average incomes. It is a document of some interest. It shows, among other things, that the 10 per cent. of households with the lowest incomes, after housing costs, have seen their incomes fall by 14 per cent. in real terms during that period. That is a decline, not relatively but absolutely, into poverty.

It is interesting to note that that group's share of national income fell from 4 to 2.1 per cent. The numbers dependent on income support in Britain have risen dramatically—from 4.4 million in 1979 to an estimated 10–3 million in the current year, over one in six of the population.

I mention those facts not as a form of special pleading for the detached and deprived, or as representative of any unrepresentative interest, because there is a wider problem that affects a large section of the population. It is that households in the bottom 50 per cent. of the distribution have seen their share of total income drop from 32 to 25 per cent. under the Conservatives, while the share of the top 10 per cent. has risen from 21 to 27 per cent., by almost a third.

Exactly the same pattern emerges on taxation, direct and indirect. The top 10 per cent. paid 32 per cent. of their gross income in taxes of all kinds, while the bottom 10 per cent. paid 43 per cent. The rich get richer, while the majority fall further behind. The truth is that the fiscal traffic is moving in exactly the wrong direction.

I concede immediately that we do not get the kind of extremes that are to be found in some of the poorer and third-world countries—wealth amid squalor—but for all that, life chances, choices, opportunities and confidence for many people in our communities are being destroyed.

It is no good dismissing social evils, as Conservatives sometimes do, because exceptional individuals can escape. For many—I suspect that this applies not just to hon. Members on the Opposition Benches—anger over the statistics that I have quoted is based on the bitterness of constituency experience.

In my city of Glasgow, for example, 78–4 per cent. of local authority tenants are on housing benefit. That reflects not some fecklessness on their part but Government policy that has forced up rents—and then the Conservatives have the cheek to complain about the numbers receiving help.

In Strathclyde, which is half of Scotland, 28 per cent. of all primary school children receive free school meals, and 36 per cent. of all primary school children in that region —I stress that I am talking about half of Scotland—qualify for clothing grant. That pattern can be repeated in every part of the country. Many of our communities are horribly scarred by the problems of unemployment.

Mr. Jonathan Evans (Brecon and Radnor)

I share the hon. Gentleman's concern about the large number of people on housing benefit. I remind him of some remarks of Patricia Hewitt, who yesterday said that there were some disincentives to people going back to work. Might not the operation of the housing benefit system be one of those disincentives, in the sense that people find that it is not worth their while seeking employment because they are receiving aid by way of housing benefit?

Mr. Dewar

I should be delighted if the hon. Gentleman were worried about the impact of the Government's policy. He might like to read the document on the growth of social security, on which I have no doubt he has been briefed by the Department. He will learn that the growth in the cost of housing benefit is one of three subjects picked out as being of particular concern.

To be fair—I want to be fair—the document also says that it is a direct reflection of the Government's policy of forcing up rents in the private and public sector. The hon. Gentleman is absolutely right to worry about the disincentive effects of the present system, a subject with which I shall deal later. He should recognise the truth of what I am saying, and should also worry—perhaps he already does but, if not, I certainly hope he will—about the fact not only that are we in this unfortunate postion but that the Government are introducing a raft of policies which will reinforce and worsen it.

I do not intend to spend a great deal of time on this issue, because the arguments are familiar, but anyone considering the impact of the introduction of value added tax on domestic fuel on low-wage families and pensioners, anyone considering the 300,000 people on low pay who will be brought into the taxation system by the freezing of personal allowances, and anyone considering the impact of a 1 per cent. increase in national insurance contributions—a tax designed to discriminate in favour of the wealthy—will know that we are reinforcing with an almost perverse determination the divisions that are already built in to our society.

On 4 March last year, during the election campaign, one of Scotland's leading newspapers, The Herald, which is based in Glasgow, carried an in-depth interview with the Prime Minister. It pointed out, very fairly, that many of the policies being followed by the Government were increasing poverty in our communities. The Prime Minister challenged that and asked for examples.

Homelessness was mentioned, and the Prime Minister said, "But there has always been homelessness." Poverty was suggested as another example, and the Prime Minister asked, "What poverty?" That will be remembered by everyone in my part of Scotland. It is also an explanation of why the trends to which I referred are being reinforced —we have a Prime Minister who, faced with the social realities, thinks it is adequate to answer, "What poverty?" and then give a leaden collection of excuses.

Mr. Peter Thurnham (Bolton, North-East)

The hon. Gentleman was referring to the household survey, but is he not being selective? Is he not forgetting what it was like when the Labour party was in power? The survey shows that only half of the bottom 10 per cent. had a telephone in 1979, whereas now three quarters have a telephone. Half now have a car, and 60 per cent. a video. He is being selective, and the figures do not support his argument.

Mr. Dewar

No, I am not being selective. Apparently, the hon. Gentleman has been briefed by the defensive brigade. I have read the document with considerable care. As he will know, one of the defences offered by the Secretary of State for Social Security of the fact that the bottom 10 per cent. in terms of income distribution have seen their incomes fall by 14 per cent. in real terms after housing costs is that the figures are misleading because many new people in that group are self-employed.

By some chemistry, or with the magic of a good accountant, those people are able to return negative incomes to the taxman while enjoying a much higher standard of living than the average. That is perhaps one reason for the phenomenon to which the hon. Member for Bolton, North-East (Mr. Thurnham) refers, but it is a very odd explanation for the damning statistics that I have cited.

Of course I concede that the community's overall wealth and prosperity have increased, although not to such an extent that we can be complacent in relation to competitors. Almost uniqely in this age, however, the gap in Britain is widening. The gap between the highest and lowest paid is at its widest since 1886. If that is not a condemnation of what the Government have been doing, what is?

The Secretary of State for Social Security constantly tells us that we are engaged in a debate. I welcome that, and do not shirk that challenge. I am glad to question what is happening, but the debate should not be an invitation for the community or the Government to duck out of social commitments and responsibilities.

The Chief Secretary's review is, in a sense, an admission of failure. Whose fault is it that we are in such economic difficulties? It is a cause of endless argument.

The Secretary of State for Social Security (Mr. Peter Lilley)

Can the hon. Gentleman name a single advanced country that is not reviewing the problems caused by the remorseless growth of social security spending?

Mr. Dewar

I shall come to that matter in a minute or two. [HON. MEMBERS: "Answer the question"] No. Let us look at our exact position, and we can then deal with that point.

Our present position is the departure point for the argument. We are undoubtedly in a financial crisis, and alibis have been coming forward in droves. The ex-Chancellor, the right hon. Member for Kingston upon Thames (Mr. Lamont), made an interesting personal statement in the House and blamed it all on Lord Lawson. Lord Lawson blamed Lady Thatcher. It took him 900 pages to do it, but he made a good case.

We have heard even more eccentric explanations. The Financial Secretary to the Treasury, who is unfortunately not present, said that it was all due to the yuppie revolution—the wheeler dealers in property of the 1980s, and the fast-move view that the best returns were to be found in trading financial assets. He went on to say that he now sadly recognised that all that was built on sand.

Everyone has someone to blame, which is particularly true of the Prime Minister, who blames everyone. I presume that, when he was Chancellor, he was merely obeying orders. He is now reduced to the most complete, but also the most desperate, legal defence: the refuge of every child in trouble, of merely saying "It wasn't me."

The problem—it is a real problem—is how to control the public sector borrowing requirement, which mysteriously inflated from a manageable, although not modest, election figure of £32 billion to a crisis-laden £50 billion-plus. I accept that the PSBR is too high. and recognise the need for a considered look at the DSS budget, but we must be satisfied that those who need help get it, and that the cash available is spent in the most sensible way. Above all, as a starting point we must ensure that the problem is in perspective.

We are helped in that matter—I pay tribute to the Secretary of State, because he has achieved one of his objectives. He published "The Growth of Social Security" at least ostensibly to ensure that the debate was well informed. I find it an extremely helpful document. Although it is helpful, it does not reveal the cataclysmic state of affairs in which the spin doctors and headline writers have invited us to believe.

There is always a featured figure, and in this case it was that the DSS budget would go up by £14 billion in real terms by the year 2000. That figure was prominent in the Department's press release, and I suppose that that is a triumph for the PR team. A PR team with the task of selling the Secretary of State for Social Security has a hard job, because of the product it is handling, but on that occasion it had some effect.

The test is that the percentage of GDP taken up by the social security budget is presently 12.3 per cent. The publication contains projections to the end of the century, the first of which, I freely concede, shows an increase in the percentage of GDP to 13.5 per cent. Naturally, that assumes that we continue to have 3 million unemployed and a low growth rate of some 2 per cent.

The second projection is of 2.25 million unemployed, which most of us would regard as less than a triumph, and a growth rate of 2.5 per cent. The percentage of GDP then remains stable. The third projection may be a little optimistic when we consider the Government's record, but other countries have managed to achieve it. It shows the GDP share dropping to 11–3 per cent.

Mr. Thomas Graham (Renfrew, West and Inverclyde)

When my hon. Friend sums up, will he point out that none of those other countries had £100 billion from North sea oil? The Government squandered that to keep unemployment at its present high level, when they should have invested it in the country.

Mr. Dewar

My hon. Friend is right. That is a factor. No doubt there are special factors in every country. The Germans, for instance, have the problem of assimilating the former East Germany, and that may be a negative factor. However, the British Government had the windfall of North sea oil, yet they still performed miserably.

The point that I am making is simple to those who have read what the document says about the growth of social security: if one makes anything other than the most gloomy assumptions, it is not true to say that social security spending is out of control.

Another piece of evidence with which the Secretary of State will no doubt be familiar—it was given to me late yesterday afternoon in a parliamentary answer—is the fact that this year, assuming a balanced national insurance fund that meets its outgoings from its income, without the 20 per cent. float from the Treasury, the Department reckons that the combined employee-employer contribution would be 22–6 per cent. On the assumption that present policies will continue, the estimate for the year 1999–2000 is that the figure will drop to 20.5 per cent.

In other words, we can afford present policies at a lower cost in terms of the percentage of incomes paid in contributions. That fact surely puts some of the more excitable statements into perspective. If we are to have a constructive debate, let us not assume a consensus about, or even significant evidence for, some of the more excitable suggestions that have been made.

The key is economic performance and the growth rate. I am not prepared to assume at the start of the debate that we shall continue the undistinguished trudge of economic mediocrity that this country has managed so far, especially under the present Government, but perhaps for even longer. After 14 years of what we are told has been prudent management of our affairs by a party that believes that it is uniquely blessed with financial competence, where are we?

The other day, the Department of Trade and Industry offered in evidence to a Select Committee a list of 24 countries graded according to their GDP per head. We came 18th out of 24. Yes, we beat Turkey and Greece, and we managed to edge out Ireland on the tape. But we were beaten by everyone else; even Italy was showing us a clean pair of heels. And that is after 14 years of successful magic by Conservative Ministers.

In the Secretary of State's Mais lecture—he will not be surprised to hear that I shall say more about that shortly —he said that spending in Sweden on public protection was the drag anchor that made it one of the slowest growing economies in Western Europe". All I can say is that, according to the DTI, Sweden is still comfortably taking us to the cleaners.

Mr. Charles Hendry (High Peak)

The hon. Gentleman said that we came 18th in a list of 24. Will he tell the House whether he thinks that we would be higher or lower in that list if we adopted the social chapter?

Mr. Dewar

I believe that, although it may be comforting in the short term for one or two people with primitive Conservative views, it is a dangerous heresy to assume that it is impossible to have social protection for our work force and decent conditions for our people as well as economic success. I do not believe that, in order to be economically successful, life has to be nasty, brutish and short, although that seems to be the underlying principle on which people such as the hon. Member for High Peak (Mr. Hendry) proceed.

Mr. Andrew Rowe (Mid-Kent)

It is perfectly fair for the hon. Gentleman to remind us that we have been in power for 14 years. However, the time scale is interesting. It is not long since the dock labour scheme was finally abolished. The Labour party is struggling quite hard with the legacy of its trade union constitution, and such things take a great deal longer to shift than one might imagine.

Mr. Dewar

If the hon. Gentleman is going to explain the entire record of the Conservative Government by reference to the dock labour scheme, he will soon be in considerable difficulty, even in the fortress that he probably represents.

I want to be helpful to the Government. My case is that surely even they can do better. However, I know that confidence is in short supply. For example, in his Mansion house speech, the Chancellor of the Exchequer said: a degree of cautious optimism is far from foolhardy. My goodness, that will put a spring in the step and set the pulses racing. Even the stuffed shirts and white ties must have been astonished that, in the Chancellor's 12-page speech, no page was spoiled by reference to anything so unpleasant as the unemployment rate. Having said that, the Chancellor surely would not accept the gloomy message of despair that low growth and high unemployment is to be a semi-permanent state in the country.

Let me move on to the debate itself, which has become somewhat chaotic. The headlines give an odd impression of the extraordinary volley of attack on single parents, which some of us found rather distasteful: Single Mothers Out Of Firing Line". It's U-Turn No. 6—Crackdown on single mums' benefits halted". Major Overrules Another Minister". There have also been all sorts of headlines about pensions: Tory plan to axe state pensions for better-off". Lilley tries to calm pension fears". Lilley on defensive on pensions". There is an enormous amount of misrepresentation and misunderstanding. I am unashamed that I do not always know what is happening in Government. Perhaps the Minister will be able to tell me what the Chancellor of the Exchequer meant when he was reported on the front page of the Financial Times on 13 July—

Mr. Hendry

The Financial Times is unreliable—it told people to vote Labour.

Mr. Dewar

The hon. Gentleman says from the Back Benches that the Financial Times is not reliable. There really is a rebel in the ranks.

The Chancellor was reported as saying: The reason why public spending is rising remorselessly is partly the aging population and partly the increasing take-up of benefits. The article continued: The latter factor was a desirable thing, but had to he re-examined in the light of the public borrowing, That is extraordinary. Did the Chancellor say what he meant?

Mr. Simon Burns (Chelmsford)

Will the hon. Gentleman give way?

Mr. Dewar

I will give way to the hon. Gentleman in a moment, because perhaps he will tell me the answer.

Did the Chancellor say what he meant? Did he mean what he said? Are the Government really going to run a campaign against the take-up of benefits? I have written to ask the Chancellor, and I look forward to the reply. If the hon. Member for Chelmsford (Mr. Burns) is a keen young Parliamentary Private Secretary in the Treasury, or something important like that, I will gladly give way so that he can tell me the answer.

Mr. Burns

I must disappoint the hon. Gentleman, because I am not a keen young PPS in the Treasury. Are the views on pensions of his hon. Friend the Member for Birkenhead (Mr. Field) an embarrassment to him?

Mr. Dewar

I may, on occasions, look embarrassed, but not at the moment. I agree with the basic premise on which my hon. Friend wrote his pamphlet—we want an effective and strengthened occupational pension sector that is properly regulated and that provides prosperity for those who participate in it. At the same time, we want to maintain—as my hon. Friend made clear—a state retirement pension scheme to which all contribute and all draw as an essential part of everyone's planning for retirement. On that philosophical basis, I totally agree.

Mr. Burns

And all the rest?

Mr. Dewar

I am not committed to all the detail in that document. It was a contribution to the debate. Of course, on the fundamental points, I have no quarrel with the areas that I have just outlined, which I have fairly summarised.

Let me ask about the Prime Minister in Tokyo. There were headlines as a result of what the Prime Minister said about the pensions nightmare. He said: The long-term trends were disastrous. However, by the end of the century, which at least gives us some time to think, the cost of the basic state retirement pension is to increase from £25.5 billion to £25.8 billion in real terms—0.2 per cent. per annum. That is hardly a case for putting pensioners in the dock, as the Prime Minister tried to do today.

The Minister boasts about the rise in pensioner incomes. Of course I welcome that, but the Minister cannot take credit for it, because of his input on pension provision. There are 1.6 million pensioners still on income support, and every pensioner I know, including many experts, such as the actuaries Noble Lowndes and Partners Ltd., who published such figures recently, believe that the British pension is still at the bottom of the European league.

The one area in which the Prime Minister could have found it is in the growth in the state earnings-related pension scheme, which will rise by 14 per cent. in real terms by the end of the century. Surely not even the current Prime Minister can complain about paying out to people who have made prudent and proper provision for their retirement under such a scheme.

We are being misled in a wide range of areas, and the danger is that there will be an ill-considered conclusion that leads to an ill-defined and inappropriate package of cuts—an attempt to force vulnerable groups to contribute to a fund to bail out the Treasury for mistakes for which it was itself largely responsible.

May I move on to one or two points of importance? The first is what the Secretary of State for Social Security has been saying. I give him his full title, because in my view the objectionable nature of his theories is aggravated by the office he holds. He gave us an interesting lecture—the Mais lecture on 23 June—in which he advanced a new and harsh doctrine: do not argue that we cannot afford the present level of welfare spending because of our economic difficulties. He went on to argue that we shall never, and should never, afford the present level of spending, because a well developed welfare system is incompatible with economic success.

The Secretary of State went to Wales shortly afterwards, where no doubt he thought he would find a soulmate. The Secretary of State for Wales, proud of his new knowledge, may have been able to explain to the Secretary of State for Social Security how he got there. In any event, he went to Wales, and although I cannot obtain a text of his speech, he was widely reported as saying—this encapsulates the argument—that welfare spending at the present level throttles economic growth.

The Secretary of State may have been misrepresented, but I have read the Mais lecture, so I know that I have the thrust of it right. He lovingly spelled out his arguments. The Pacific rim was prayed in aid. It does not have well developed welfare services, which, we were told, is why it has been so successful. Perhaps Taiwan and Korea would put more emphasis on investment in new plant and machinery, in skills and in higher education, which makes even this Government's targets look ultimately inadequate and modest.

The Secretary of State went on to argue the secret of the success of job creation in the United States, which has out-performed Europe in the past 20 years, lay in the inadequacies of its welfare system. He instanced them. After all, he said, there is less generous unemployment benefit; there is no real equivalent of income support; and it is available to only a small group—ironically enough, single parents with dependent children. He went on to look admiringly at the right of American employers to hire and fire totally unfettered by the law.

That, we were invited to imagine, was the key to economic success. I think it is a digrace—I use the word in cold blood—that the man who is in charge of social security in this country has such a vision for the future of this nation. I wonder—it is, perhaps, a passing curiosity —whether he has considered the ultimate heresy in America of a minimum wage, and how on earth it can he so successful with a minimum wage.

When he talks about contracting out, has he considered why the Clinton Administration are desperately trying to solve the problems of a private insurance health service that is no longer serviceable? I accept neither his logic nor the politics of his position.

The other great cause, which I can mention only quickly in passing, came from what was hopefully described by those who took part as "brainstorming" at Chevening. The big idea is contracting out—contracting out of the state retirement pension and ultimately, we gather, from health and unemployment cover.

There are difficulties. We all know about the problems of exit control—the more people who contract out, the more today's income is reduced, while liabilities under the pension and benefit system remain unaffected. For the next 10 or 15 years at least—that will do fine for the sake of this argument—there will be an incompatibility between the long-term ideology of the Secretary of State and the short-term crisis management demands of the Chief Secretary to the Treasury.

As I have said before, and as the Minister knows, my objection is that, if we say to middle-income Britain, "Get out of the health service, get out of unemployment cover and get out of all forms of pension provision," we are moving inexorably towards a two-tier system—a safety net provision, with all the implications of stigma that flow from it. We will be moving towards a world where the gear is ill divided and where applicants' applications for benefits will be a surrender and an admission of defeat in the eyes of a large part of the community.

I say to the Secretary of State that all this creates a good deal of alarm, and a great deal of despondency. I have sympathy for the pensioner who today watches the state retirement pension falling as a percentage of male average earnings from 22 per cent. in 1978–79 to 16.9 per cent. today, and which is projected in parliamentary answers to decline further to a mere 7 or 8 per cent. in 2045. I have particular sympathy for pensioners who are angry when that fact is not explained, and when the tie-in to the retail price index is paraded as a caring triumph.

I have doubts, which are shared well beyond the House, about a Government who have a prominent supporter who has characterised a single parent as a mother with six children by four different men who does not know which child is which. I worry when I listen to the Secretary of State wowing a party conference with a famous speech about women becoming pregnant to jump the housing queue, as though it were the fashion in our community to lie back and think of a council house in an unpopular area and of a life on income support. The truth is that only one in 25 single parents is a teenager while over 70 per cent. of one-parent families result from a breakdown in a long-term relationship.

I am concerned for those who receive invalidity benefit, who can be dismissed all too easily as scroungers and layabouts. Of course, if there is abuse, it ought to be stamped out, but there are genuine concerns about the apparent plans of the Government to bring the benefit into the tax system, to cut or restrict eligibility and to reduce the level of benefit.

I warn the Government that it will be hard on those who are genuinely struggling with the effects of ill health to contribute the £500 million that taxing invalidity benefit would produce. That would mean 900,000 people paying a higher tax bill of, on average, £500 a yar. It would mean also 200,000 people being brought into the tax system who have no benefit other than invalidity benefit.

I shall refer to some departmental papers that have reached the public domain that concern the government's proposed reform. Does reform mean that a 55-year old builder who has angina and is unable to walk on the flat for more than 200 yards before he has to stop because of chest pains should be disqualified from invalidity benefit? If that is a triumph of reform, I suppose that I am against reform. But I do not accept that it needs to take that shape. I believe that reform can be based on sensible social priorities and make an improvement in the system.

The Conservative party is keen to claim the family as its political property. I believe that it has done all it can to undermine the stability of family life—or perhaps its policies have done so unintentionally. Does unemployment add dignity to a family? Does an income below the household weekly average of £250 do anything for stability? Two thirds of British families are below that level. Does an increase in the number of children who are living in poverty do anything for the role of the family? That number has risen threefold under the Government. I say that with no pleasure, and I recognise that there are questions that must be asked and answered.

The Labour party does not want to defend the status quo as an act of faith. Too much is wrong with the benefit system as it operates today, and I could give many instances—for example, the position of women in the system, with millions working part-time for low wages who have no entitlement to national insurance benefits. The system does not recognise sufficiently the contribution that is made by many women in the home as carers and of course in the workplace.

The very existence of the Commission on Social Justice is a mark of our intent and seriousness of purpose. The commission is independent, and it does not make policy for the Labour party. I hope that its role will be to stimulate and innovate, and it has made a good start.

Unlike the Government's review, the commission recognises and expects that employment, unemployment and associated problems are major factors which are linked to poverty today. We have started to lay the foundations for reform—the equal worth of all citizens, the ability of a citizen to meet his basic needs, access to opportunities—by analysing the troubles that this country faces. Those principles are important and highly relevant to our country, where the gap between those who have and those who have not is constantly increasing.

The Labour party is committed to searching for solutions. We will look for change, but change does not mean the abandonment of principles. The Secretary of State may be surprised, but I agree that £6.6 million is more than any Government would want to spend on support for single parents. But that should not be because single parents are a marginal group who are beyond the pale, or because they have lost all priority in the system. It should be because of the tragedy that 70 per cent. of single parents are trapped on income support, when the vast majority of them want to earn and to be financially independent. How we achieve that, and how we emphasise affordable child care, training and job opportunities, is the test of how we should deal with the problem.

I believe that work is the key. There must be opportunity in our society. I was much taken by a comment in a recent pamphlet by the Commission on Social Justice: Unemployment is not about why you lose your job, but about why you cannot get a new one". It concluded: Paid work for a fair wage is the most secure and stable way out of poverty. I agree. So would 3 million other people.

I believe that the emphasis should be on lifting the restrictions and limitations imposed by the poverty trap and life on benefit. I want to break this unpleasant stalemate, and encourage and enable the many who are trapped in the system to gain financial independence. Why, when a married man loses his job, is the family often better off if his wife gives up her employment, which may be part-time, and joins him in the dole queue?

I believe that fraud and abuse should be eliminated whenever possible. There is a clear duty to do that fearlessly and impartially. I object to the exaggeration, machismo and posturing at party conferences, with the Secretary of State appearing as Action Man. Why is fraud such a problem after 14 years with the Tories in charge? My constituents are getting no answer to that question.

I believe that occupational pensions make a major contribution to retirement. We look for early legislation based on the Goode committee report—it is patently necessary to increase the safeguards and to bring about a shift in favour of control by the beneficiaries. The present system demands that.

We believe that the basic state pension is a foundation on which all should be able to rely when planning their retirement. It should not be means-tested, certainly not on a grand scale by policies on contracting out designed to produce a walk-out by those schooled to think of a private purchase as better than, rather than complementary to, public provision.

We believe that the contributory principle should be honoured. It destroys confidence to know that Ministers have contemplated ratting on promises given to those who have paid over the years. Ministers have already done that on many occasions: the fixing of SERPS a few years ago, the disappearance of dependency additions for children in unemployment benefit—

Mr. Lilley

Is the hon. Gentleman disowning remarks by Patricia Hewitt of the Commission on Social Justice, made on the radio yesterday, to the effect that the commission is reconsidering the whole contributory principle and believes that it has led to absurd results?

Mr. Dewar

I have not read that quote—[HON. MEMBERS: "Ah!"] I am, however, glad that the right hon. Gentleman has mentioned it, because I do not think that a simple message has yet penetrated his head. [HON. MEMBERS: "Surely skull?"] I resisted the temptation, because I did not want to be offensive to the right hon. Gentleman.

He must recognise that, when I say that the Commission on Social Justice is independent, I mean that it is independent. So, although it may propose many things that we will want to adopt, there may be others that we will not want to adopt. We shall look at each recommendation on its merits. That may seem a remarkable fair-minded and independent way to proceed, and it may therefore be anathema to the political machinations of the right hon. Gentleman—but he must live with that.

Speaking of machinations and Machiavellian manoeuvres, I do not think there is a great deal of principle about a Minister who can cause a letter to be drafted to the Prime Minister saying that abating invalidity benefit at a rate of 50p in the pound above a given threshold raises difficult questions about the future of the contributory benefits system before we have fully thought through the direction that we want to take". That certainly suggests that the right hon. Gentleman's constancy in defence of the contributory principle in public is not reflected in what is happening in private and in what may emerge from the desperate attempts to meet the Chief Secretary's targets for slaughter in the benefits system.

There is a fashionable heresy—one that many want to encourage—that there is no difference between the parties. I do not believe that that is true in the wider sense; I am certain it is not true of social policy, over which a major battle will be fought in the months that lie ahead. There is a real division between the parties.

I am not interested in reform based on the short-term dictates of the Treasury. We have a principled position, a clear view of the duty of the community to provide opportunity that allows the individual to flourish in a way that the unfettered market never will allow.

The Minister should talk to my constituents. I would not presume to judge the situation in St. Albans, but he can go to almost any large community in this country and talk to people who cannot buy into the marketplace—they could never get started up the financial ladder that would allow that. Such people have been deprived of educational opportunity; their talents have been lost to the nation because they have had to struggle with deprivation, a lack of income and the social pressures with which almost every Member of Parliament is familiar. I see it every day. I am ashamed of the record of all of us over the years, but I am more directly ashamed of a Government who, far from having struggled in vain, have not struggled at all.

We challenge the analysis that divides society into two thirds and one third: the syndrome of the underclass. We stand against the theory that those who are financially fortunate have no interest in helping those who are not. The truth is that two thirds of the families of this country have an income below the national average. For the great majority—I hope, for all—there is a common interest in acting together to raise standards and eliminate injustice. That fight is not being fought at the moment.

With today's weapons and tomorrow's vision, the Labour party will continue to struggle against want, disease, ignorance, squalor and idleness—the forces that still depress and destroy people. We must try, to the best of our ability, to liberate those people by providing them with opportunity and hope. We look forward to the challenge. With the support of the public, we will win where it matters most—at the ballot box.

4.30 pm
The Secretary of State for Social Security (Mr. Peter Lilley)

I beg to move, to leave out from 'House' to the end of the motion, and to add instead thereof: 'supports the Government's approach to the reform of social security, which is designed to improve the system, protect the vulnerable and prevent spending outstripping the nation's ability to pay: and deplores the scaremongering tactics of the Opposition, who cause unnecessary alarm to the least well off, elderly and disabled people, yet fail to produce responsible alternative policies.'. Several weeks ago, I called for a debate on the future of social security, and that call has been widely welcomed. I have already received a number of interesting contributions, and I particularly welcome those from individual members of the Opposition. The hon. Member for Sheffield, Brightside (Mr. Blunkett) has had some sensible things to say on single parenthood. The hon. Member for Birkenhead (Mr. Field) has made some radical proposals on pensions. Even the Commission on Social Justice holds out the promise of constructive thinking, albeit postponed for another year.

I was delighted when I heard that the Opposition had chosen to spend a full day debating social security policy. I thought that at last we would hear some constructive proposals from Labour's official spokesman. Alas, my optimism got the better of my experience. What a disappointing speech we heard from the hon. Member for Glasgow, Garscadden (Mr. Dewar), what a wasted opportunity. He offered us not a single positive proposal. He could not rise above his normal litany of sanctimonious humbug, tedentious statistics and scurrilous scares.

That is not just my verdict. Writing in The Guardian about the contribution by the hon. Member for Garscadden to the debate, Hugo Young said: Labour's instant responses to everything Mr. Lilley has begun to venture bear all the hallmarks of a party incapable of addressing a long term issue if there's an easy and destructive short term point to score. The hon. Member for Garscadden has accepted that the public sector borrowing requirement is too high and that he needs to take a considered look at the Department of Social Security budget. Nothing that he has said today would avoid the path to higher spending and borrowing.

Yesterday, Labour's Commission on Social Justice produced its first interim report. It is the first time that any party has contracted out its policy preparation. As it is the Labour party's first venture into privatisation, the Government have a vested interest in its success, to vindicate our principles. Alas, I found its first report rather disappointing. I shall go back to see whether there is more to be gained from it, but on first reading I could not see one ounce of fresh thinking—only the old tedious obsession with equality, a preoccupation with attacking the wealthy rather than relieving need, a trawl of all the old leftish critiques of social policy and a shopping list with implied demands for extra spending worth billions of pounds. There is not a single explicit proposal for saving, and not even any clear recognition of the need to curb the remorseless growth of social security.

The report is keen on numbers. It contains four objectives, five principles, 10 propositions, but not a single concrete proposal.

Ms Angela Eagle (Wallasey)

Does the Secretary of State really believe that the redistribution of income from the poor to the rich, which has been such a feature of his Government's period in office, is tedious?

Mr. Lilley

The hon. Lady should realise that almost every group in society has improved its well-being under the Government. For example, the income of an unemployed person with two children has gone up by 10 per cent. in real terms. Furthermore, the Social Security Select Committee believes that income support levels are now some 15 per cent. in real terms above the level that the previous Labour Government thought satisfactory when they were in power.

I am discussing the first interim report of Labour's Commission on Social Justice. I suppose that a commission including seven left-wing professors was bound to be a bit short on reality and long on rhetoric. Rhetoric without responsibility has been the privilege of zealots throughout the ages. The report is full of glib but meaningless phrases. My favourite is Gordon Borrie's assertion: We must stand in the future, and then work out how to get there. I am not sure that that is quite a fair description of the shadow spokesman on social security. He stands in the past and still has not quite worked out how he got there.

Those who understand Labour-speak tell me that all the cryptic language in the social justice commission's report contains coded messages that are all quite encouraging. They say that I should not despair of the social justice commission. It is gently nudging Labour towards reality, acceptance of a market economy, recognition that expenditure cannot outstrip the nation's ability to pay and all the other things that I have been saying in rather boring uncoded English.

I reaffirm that I shall be only too happy to consider any constructive contribution that it may make to the public debate for which I have called. One thing is certain: we shall not get any constructive contribution to the debate from the Labour leader, shadow Chancellor or shadow spokesman on social security, all of whom have shown themselves to be incapable of radical thought.

The hon. Member for Dagenham (Mr. Gould) writes in this week's New Statesman and Society: Smith is the prime exponent of the school that believes that Governments … should be harried—but on no account should the Opposition divert attention by offering anything positive of its own. The hon. Member for Dunfermline, East (Mr. Brown) is assiduous in ensuring that his attempts to harry are devoid of any positive comments. That is why he has become universally known among the press corps as "Mr. Faxascare". He has devalued the currency of political debate so much that his words are now losing their value faster than the pound would were he ever to become Chancellor.

The future of the social security system is vital to millions of people. Nearly all of us depend on it to some extent at some period in our lives. Reform of the welfare state is most in the interest of those who most depend on it. The hon. Member for Garscadden, by rejecting constructive debate in favour of negative criticisms, as he did today, neglects the interests of those whom he claims to want to help. I shall not respond in kind.

We need a constructive debate on the future of social security, not just for financial reasons or because of the growth of dependency, but because the world has changed enormously since the Beveridge system was established. New needs have emerged that were scarcely considered when Beveridge wrote. The nature of old needs has changed as society has altered dramatically.

Mr. Graham

Does the Minister realise that many of our postbags are full of letters from people writing about this subject? I can give a number of examples, but will use only one. A constituent of mine receiving mobility allowance was suddenly turned down, although it was apparent that she was desperately ill. She managed to get to my constituency surgery with a great deal of help from her neighbours. After I had written, we eventually got an appeal, which she won and got her money back.

I have seen numerous cases where people have been turned down for invalidity benefit, mobility benefit, attendance allowance and so on; yet when we start scrutinising, we get the money for those folk restored. There must be a better system, which would not knock people off benefits when they are quite entitled to get it. However, since the Secretary of State has come in to run the show, our constituents have been suffering deeply. The Government have given the message to social security offices to make cuts. That is worrying. I shall give the figures to the Secretary of State. He has received many letters from me, and I shall continue to send them to him.

Mr. Lilley

I shall certainly look at any individual cases that the hon. Gentleman cares to bring to my attention. I am sorry if individual constituents received wrong decisions. I am glad that those decisions have been put right by the independent adjudication officers and procedures. If those procedures need improving, the House will say that it is right that they should be improved. No edict has gone out to suggest that such wrong decisions should be given, and that would not be possible. The law has to be followed. The law on social security is laid down by the House and by the regulations that we, in turn, lay down under that law.

An informed debate needs information. That is why I have spelled out the facts in "The Growth of Social Security", and I am glad that the hon. Member for Garscadden found it useful. The Social Security Select Committee urged me to publish it and I was happy to respond to its request. The document makes the position clear. The social security budget is more than £80 billion a year. That is twice the size of the budget of the next largest Department. It is nearly one third of total Government spending. It is one eighth of gross domestic product. It means that, on average, it costs every working person £13 every working day to finance social security. Moreover, social security spending has been rising. It has risen by two thirds since 1979.

That growth has not been primarily due to the rise in unemployment. If we exclude all expenditure on unemployment, there was still underlying growth of spending on social security of 3 per cent. a year above inflation since 1979. The projections suggest that the underlying rate of growth—again, excluding unemployment—will be 3.3 per cent. a year in real terms up to the end of the century.

Mr. Malcolm Wicks (Croydon, North-West)

Does the Secretary of State agree that, according to his useful document, unemployment benefit expenditure is now more than £9 billion compared with £3.7 billion at the beginning of the Conservative Administration 14 years ago? Does he further agree that that represents a great deal of benefit expenditure but also a great deal of social insecurity? Will he spell out his assumptions about full employment and unemployment in the future? Does he agree that we need economic policies to create social security and not always so-called social security policies?

Mr. Lilley

If the hon. Gentleman cares to read my Mais lecture, he will recognise that I accept that there is an important two-way link between social security and economic policy. It is important that they work in harness, and it is absolutely essential that we do all in our power, as we have been doing, to get unemployment down and deal with the real underlying problem, to which I shall come—which is the tendency for people to spend longer and longer on that benefit, rather than increasing the number of people to come on to it in the first place. I shall come to that issue later.

Mr. Dewar

Will the Secretary of State give way?

Mr. Lilley

No. The hon. Gentleman has had his chance.

Since I published the document, the Opposition have continued, as the hon. Member for Garscadden did today, to deny that there is any basic problem. I wish that they were right. It would be an immense achievement if the Government had managed to secure the absence of any problem in social security, as every other major industrial country faces such a problem, even though the hon. Gentleman appeared to be utterly unaware of it. They all freely admitted that at the G7 meeting in Tokyo.

Indeed, other countries that did not take some of the steps that we introduced in the 1980s, such as linking benefit rates to the cost of living rather than to earningss, face even tougher problems than we do. France has had to cancel a pension increase that was planned for this month. Three weeks ago, Germany announced a package of measures to cut £7 billion off its social security spending next year, including a 3 per cent. reduction in unemployment benefit rates, and a reduction in their duration.

Sweden, which had by far the most generous social security system, has found it a crippling burden. Public spending on social protection was more than a quarter of its gross domestic product. Few doubt—it is not just me —that that was the drag anchor that made Sweden one of the slowest growing economies in western Europe over the past two decades. Finally, last year it was faced with financial collapse and all parties agreed to a programme of wholesale reform. The Lindbeck report was commissioned and came up with some of the most radical proposals for the state's scaling down its activities in the social security sphere that any country has yet seen. Sweden was forced to announce an increase in the state pension age to 66, beginning almost immediately for both men and women and phased in over the next four years.

In this country, we have been able to avoid such arbitrary cuts in benefits because we have thought ahead. By means of this public debate, we intend to continue looking ahead so that we can make sure that we get it right.

Mr. Dewar

I hope that I did not say that there were no problems in the longer term, but I did say that the problems were overstated. The Secretary of State will be familiar with table 6, to which I referred earlier. It says that, in case 1, there will be an increase, until the end of the century, in the percentage of gross domestic product going to his Department. As he knows, that is based on the assumption that unemployment remains at 3 million and growth at 2 per cent. Does he accept that there are two other projections—one producing stability and the other a cut? Is he ruling out the improved economic performance that would result in either of those two projections?

In case the right hon. Gentleman does not let me intervene again, let me ask a second question. I understand that his personal position is that we have to cut, not because of financial difficulties—as many countries have done—but as part of economic policy, because he believes that it makes for a leaner and more efficient economy. What does he think that the proper percentage of GDP should be?

Mr. Lilley

I have no desire to cut. I wish to curtail growth in the system to ensure that it does not outstrip the nation's ability to pay. It manifestly has been doing that and, if we do nothing, it will continue to do so in the future.

The hon. Member for Garscadden says that we can ignore the underlying growth because of the underlying reduction in unemployment, which will dampen that growth. I maintain that we should look at the underlying growth. We should not allow a return to lower levels of unemployment, which we all wish and expect to see, to conceal that underlying trend. Indeed, we exclude expenditure on unemployed people from the Government's new control total because we believe that it is right, in the downswing in the economic cycle, to finance a rise in unemployment, and we rightly accommodate that rise for both economic and social reasons.

Therefore, it would be wrong to use a decline in unemployment as the economy recovers as an excuse to relax restraints on public expenditure during the recovery. It is clear that the underlying position of spending outstripping national income cannot be sustained indefinitely and that we ought to take action sooner rather than later.

The other reason that the hon. Gentleman gave us as to why we can evade any need for serious reforms is his claim, made also by the hon. Member for Croydon, North-West (Mr. Wicks), that we can curb the growth in social security spending by action elsewhere. Invariably, that means extra spending on training, investment in the infrastructure and similar measures. All those are desirable in themselves and they would have desirable consequences for social security. We should certainly continue to foster them by all the means at our disposal. However, on any reasonable prospect, they cannot be a substitute for structural reform of the social security system.

If social security spending continued to grow too fast, it would throttle economic growth—I said that it would, not that it had in the past—and pre-empt private and public resources for training, investment in the infrastructure and other desirable programmes. It is sheerest fantasy to suggest that we can significantly expand public spending in other Departments in the fond hope that that will reduce social security spending some time in the future. There is no escaping the need for structural reform of the social security system, both to contain spending and to ensure that the money is spent to the best effect.

Mr. Nick Raynsford (Greenwich)

The Secretary of State said that it was fantasy to believe that one could reduce social security spending by increasing expenditure in another Department. Does he recognise that reductions in spending in other Departments are increasing social security spending? What has been the increase in expenditure on housing benefit as a result of the direct policies of the Department of the Environment to cut grants and to force up rents? Will he assure us that the Government will not attempt to penalise tenants through cuts in housing benefit as a result of that shift in expenditure from the Department of the Environment to the Department of Social Security?

Mr. Lilley

I did not say that it was impossible for the impact of spending in one Department to influence that in other Departments beneficially or adversely. I said that it is fantasy to suggest that there is scope for avoiding any need for reform of the social security system by spending more now in the hope that it will produce a reduction in future. Of course I acknowledge in the document that there has been a transfer of subsidy from bricks and mortar to individuals. That is sensible, because ultimately it means a better working housing market, and that means that individuals have more choice as to where they live and where they get the help, rather than being anchored to one building.

To make sensible structural reforms we need to understand where the growth in social security is coming from and why. The analysis that I published makes that clear. First, the growth since 1979 is not principally due to the growth in unemployment, as is repeatedly alleged. Total spending on all benefits to the unemployed is only 13 per cent. of the Department of Social Security budget. The rest of the budget has been growing at 3 per cent. per annum since 1979.

Ms Eagle

What about low wages?

Mr. Deputy Speaker (Mr. Michael Morris)

Order. The hon. Member for Wallasey (Ms Eagle) must either try to catch my eye to make a speech or remain quiet.

Mr. Lilley

Unemployment is falling, and as the economic recovery gains momentum we can expect it to fall further. In addition to the cyclical movement, however, there has been a longer-term trend in the length of time that people spend on unemployment benefit. Until the mid-1980s we were paying unemployed people to spend longer and longer on benefit. Arrangements for paying benefit had been divorced from job search. Rules requiring people to look for and accept available work had been enforced with declining vigour. Between the early 1970s and the mid-1980s the number of people referred for refusing available work and then denied benefit had declined by about 50 per cent.

Starting with the restart programme in 1986, however, successful policies have been introduced to keep unemployed people in touch with the world of work. During the 1980s the Government also sought to lighten the obligations imposed on employers. It was felt that, rather than protecting jobs, such burdens discouraged employers from taking on extra staff. As a result of those changes, Britain has had markedly greater success in generating private sector jobs in the 1980s upswing than previously or on the continent, and we are the only European Community country in which unemployment has fallen in recent months.

I am astonished that the Labour party should want to put that success at risk by imposing the social chapter on the United Kingdom. It is even more astonishing—but not surprising—that the Liberals, who have one representative in the Chamber, should join them, given that the Liberal leader has roundly denounced the contents of the social chapter root and branch.

We have shown the value of easing burdens on employers, of freeing up the labour market and of making unemployment benefits conditional, while providing active help to people to return to work. In doing so, we were acting in the spirit of Beveridge, because he foresaw making receipt of benefit subject to the requirement of attendance at a work or training centre after a limited period of unemployment". The second clear conclusion from the document that I have published is that the expected growth in spending to the end of the century will not be due to the growing number of pensioners. The hon. Member for Garscadden was correct about that. Indeed, there is not expected to be any increase in the number of pensioners this century. There will be an increase in the second and third decades of the next century, which will obviously influence our decision on equalising the state pension age. That was what my right hon. Friend the Prime Minister referred to in Tokyo.

Claims that the Government are forecasting an increase in the number of pensions, and that consequently we shall target benefits to pensioners, are unfounded and are demonstrated to be so by the document that I published. I know that that will probably disappoint the Opposition and particularly the Liberal party, in their campaigning in Christchurch, but they cannot say that the document suggests that we shall focus adversely on pensioners in any way as a result of the review that I have initiated.

The Government have always attached the highest priority to improving the position of pensioners. Our policies have been outstandingly successful and we are determined to build on our achievements. First, we recently channelled to the least well-off pensioners an extra £1 billion over and above annual inflation increases since 1989. That included a £2 a week increase for single pensioners and £3 for a couple, above inflation, last October. This April, poorer pensioners gained a further £2.90 a week for a couple from abolition of any liability to the council tax.

Secondly, we have protected pensioners' savings by tackling inflation, which is now running at 1.2 per cent. a year, whereas we uprated benefits by three times that amount in April. Thirdly, we have kept interest rates above the level of inflation, so that pensioners get a real return on their savings—not a bogus income while their capital was being wiped out, as happened under the last Labour Government. Finally, we have encouraged individual provision for retirement, over and above that provided by the state. About 70 per cent. of new pensioners now have occupational pensions and nearly 80 per cent. have additional income from savings and investments.

New figures published today show the cumulative success of those policies in improving incomes in pensioner households. Average incomes in 1990–91 were about 42 per cent. higher than in 1979, after allowing for inflation, and incomes after housing costs were worth more than half as much again as they were in 1979—about 54 per cent. more in real terms.

The analysis that I have published shows that the growth in social security provision between now and the end of the century will come primarily from three main sources: invalidity and related benefits, expenditure on lone parents and housing benefit. Opposition Members may not like those facts to be spelt out but a sensible debate must focus on the facts, and those sources are where the growth is coming from.

The number of people receiving invalidity benefit has grown from 600,000 in 1979 to 1.5 million now and will have trebled by 1995–96. Yet the nation's health has been improving during that period. I challenge the hon. Member for Garscadden to clarify his remarks and tell the House whether he believes that we should ignore or accept that—or will he and the Commission on Social Justice review the future of that benefit?

Mr. Dewar

I made it clear that we want to build hope and incentives into the lives of those trapped on invalidity benefit and that we do not want abuse of the system once we have decided what the eligibility principle should be. That includes single parents as well. Has the Minister recently re-read the evidence given to the Public Accounts Committee by Sir Michael Partridge, his permanent secretary, which made it clear that he believed that there was a strong link between the level of unemployment and the number of people on invalidity benefit? Is he now repudiating Sir Michael's opinions at that time?

Mr. Lilley

We have spelt out clearly the relationship between invalidity benefit and cyclical forces in the very document whose publication the hon. Member welcomed —obviously Sir Michael Partridge had his input into it —but he has not answered my question. We all want to improve and lighten the lives of those on invalidity benefit. but does he believe that the present tests are acceptable, or would he review them and consider reforming them?

People are not trapped on invalidity benefit; they are meant to be on it because they are incapable of working. That is the basic criterion laid down by Parliament, and if the hon. Member does not agree with that—

Mr. Dewar

I certainly agree. I am genuinely open to correction, but my understanding is that the outstanding feature is not the number of people who have gone on to invalidity benefit but the length of time that they have remained on it. Of course I accept that invalidity benefit is for those people who are unfit to work and are genuinely ill, and no one would object to that. I object to rewriting the rulebook, not because of any wish to deal with genuine social and personal problems but simply because the Chief Secretary tells the Secretary of State for Social Security what he must do.

Mr. Lilley

The hon. Member continues to wriggle. The number of people on that benefit will have trebled from 600,000 to 1.8 million by 1995–96. I know of no other reason for examining whether it is being applied in quite the right way.

It is right to consider whether we can develop a more objective test of medical incapacity for work. I recognise that any objective measure is bound to be controversial. Wherever the threshold is set, it will be possible to highlight difficult cases that fall just short of it. However. it is implicit in any test, including the present one, with which Opposition Members seem to be satisfied, that some people will be found to be capable of work while others will he found to be incapable. It is surely better to have as objective a test as possible rather than to rely on an element of subjective assessment.

Mr. Rowe

Is not one of the problems with invalidity benefit that some people on it have convinced themselves that they are incapable of improvement? They need to be given the opportunity to test themselves in some way without losing their eligibility for benefit. When challenged with work that they can manage, many people find themselves getting better physically and mentally.

Mr. Lilley

My hon. Friend has hit on what may be a genuine problem in some cases. We want to encourage disabled people who can return to work to do so. That is why we established disability working allowance. We are keen to see how that benefit develops as the economy recovers and work opportunities increase. It is reasonable for disabled people to receive extra help to enable them to compete effectively in the marketplace.

As I have said, it is right to develop, if we can, an objective medical test. I certainly do not blame doctors for the apparent inadequacy of the present system of invalidity benefit. The rules are complex and doctors often feel themselves placed in an invidious position. Since we began tightening the way in which the current rules are administered, 300 doctors have contacted us to express their support for changes. It was not the Government but the magazine Monitor, which goes to 35,000 general practitioners, which carried out a survey of doctors, two thirds of whom said that they had given claimants sick notes knowing them to be capable of work. Hon. Members may rest assured that any proposals that we develop will be brought before the House for consideration.

It was also right to raise the issue of lone parenthood. For too long it had been deemed politically incorrect even to discuss the facts, let alone to reaffirm the value to children of being brought up by two committed parents. The number of lone parents rose from 570,000 in 1971 to 1–3 million in 1991, and 1 million of them depend on benefit. Fewer than one in four of them receive a penny of regular maintenance from the absent parent.

Total benefit expenditure on lone parents and their childen has trebled since 1979 to £6.6 billion. The hon. Member for Garscadden and his hon. Friends have tried to close the shutters on debate by condemning anyone who mentions lone parents of advocating Victorian morality and bully boy tactics". Those are the words that the hon. Gentleman used when my right hon. Friend the Secretary of State for Wales and I raised the issue. That is nonsense.

We know perfectly well what a raw deal many lone mothers get. They are in that position through no desire of their own. They have perhaps been deserted by their husbands; they have been subjected sometimes to violence; and they are struggling to bring up their children without any support from the father. That is why we set up the Child Support Agency, which is dedicated to securing payment of maintenance from the absent parent. That objective has received widespread support from the general public, from lone mothers and from responsible absent parents. I remind the hon. Member for Garscadden that he has also supported it, although grudgingly.

Mr. Dewar

It seems that I cannot do anything right. I feel like one of the victims of society. The right hon. Gentleman knows that I have always defended, sometimes under some pressure, the principle that a parent ought to contribute to the maintenance of his or her child. I am listening with interest and with some sympathy to this latest, and perhaps uncharacteristic, passage from the right hon. Gentleman. Does he agree that it is important, for the family's benefit and especially for the benefit of children, that some sort of disregard of income support is considered for single parents?

Mr. Lilley

The hon. Gentleman has just demonstrated what I meant when I spoke about sanctimonious humbug. His assumption that no one else has any regard for the difficulties faced by people such as lone parents is offensive, and most people would find it hypocritical.

Mr. Dewar

What is the benefit to the family?

Mr. Lilley

The benefit is that maintenance payments are portable and help the mother to go back into work, which is what the hon. Gentleman said he wanted. It is right that in the first instance payment for supporting a child should be made by both parents. The taxpayer should step in only if the parents do not have the means to support their child. To suggest that such help should be additional is extremely perverse.

Mr. Dewar

I should like to be quite clear on this important statement by the Secretary of State. He says that it is perverse to suggest that we should follow the example of Australia and some other countries in which there is some gain for the lone parent on benefit. At the moment, for 70 per cent. of those on income support, there is a straight pound-for-pound clawback. Is the Minister ruling out any change to that? If he is, he will increase the difficulties surrounding the system, which in principle is right. However, many of us have grave reservations about its practical impact.

Mr. Lilley

It is right that in the first instance the parent and not the taxpayer should pay. To suggest that both should offer support and that it should be cumulative will not go down well with those who have written to me in droves and who overwhelmingly support what we are doing. The hon. Gentleman always tries to criticise and is muted in his praise of the system because the Labour party conference voted overwhelmingly against the Child Support Agency. The Opposition would prefer mothers to be dependent on the state and the responsibility of fathers to be taken over by the state. The hon. Gentleman would do better to condemn his party rather than trying to use moral blackmail on those who raise the issue while we are trying to he constructive about it.

Mr. Barry Jones (Alyn and Deeside)

Will the Minister please give way?

Mr. Lilley

I will, but for the last time.

Mr. Jones

The right hon. Gentleman seemed to be glancingly critical when he spoke about the Secretary of State for Wales. Notwithstanding his response on that matter, does he accept that the Secretary of State for Wales caused a great deal of anger by his now famous speech about a housing estate in Cardiff? People of all parties in that part of Wales were greatly offended by the ill-informed and rather arrogant way in which his right hon. Friend sought to deal with the problem. Will the Secretary of State say specifically whether he intended to criticise his right hon. Friend?

Mr. Lilley

I intended quite the reverse. I associated my right hon. Friend and myself with our common attitude to the problem, which is to recognise that there are different categories of lone parents. As my right hon. Friend said in his speech, many such parents did not bring their circumstances on themselves and their situation often reflects discredit on their husbands or partners. It is to my right hon. Friend's credit that he helped to raise the issue. I suspect that the overwhelming response in his mailbag, as it certainly was in mine, was to welcome the fact that the issue has been raised and that it is no longer treated as taboo.

The growth in lone parenthood is not primarily the result of more generous social security benefits. The ratio of benefit relative to earnings has not risen markedly in recent decades. More significant factors are likely to be the availability of housing. The hon. Member for Brightside has called for positive housing policies that do not encourage the belief that the only way to a home is having a baby. Does the Opposition spokesman on social security endorse or disown that statement?

Mr. Dewar

My position is perfectly clear.

Mr. Lilley

No doubt the hon. Gentleman's remarks will be obfuscating.

Mr. Dewar

I find the personal remarks that the Secretary of State makes rather unfortunate; however, I shall take them up on another occasion, because he has raised an important point.

There has to be housing for families who find themselves without a roof. I would strongly object to the removal from the priority list, under the homeless persons legislation, of a family with a child simply because it happened to be a single-parent family, rather than what we all consider desirable—a two-parent family. The housing situation has to deal with social realities. [HON. MEMBERS: "Wriggling."] I am not wriggling out of anything, I am answering a question.

I do not believe that, in saying that I am giving any positive encouragement or assuming that anyone would take it as encouragement to have children—although there appears to be a mythical band of people who look at our convoluted housing allocation systems of our country and say, "We must have a child to get another 20 points on the list." It is a destructive myth.

Mr. Lilley

I was correct in saying that the hon. Gentleman's clear statement of his position would be followed by obfuscation, which left it totally unclear.

The hon. Gentleman singularly failed to endorse the remarks of his hon. Friend the Member for Brightside that the present system encourages the belief that the only way to a home is to have a baby. If people do not respond to that encouragement, it is not clear why it is a matter of importance. The hon. Gentleman suggests that the present system has no influence on behaviour, and I suspect that he is dissociating himself from the comments of the hon. Member for Brightside—however, they will have to continue that debate among themselves.

It is also important to recognise that economic and social forces play a part, as do changes in divorce laws and changing attitudes in society towards the family, personal responsibilities, adoption and the claiming of benefits. Consequently, growth in lone parenthood is not likely to be checked primarily by changes in the benefits system. Changes in attitudes will be far more important and there is a distinct limit to what Government can do in achieving that. Governments can give money; only parents can give love and commitment to their children.

Mr. Matthew Taylor (Truro)

The Minister is making an important point and there is no real disagreement with the concern that he expresses, but he has to make an important decision on how it is tackled. He stressed his concern that people feel they are likely to get social housing provision only if they have a child. That is inevitable so long as the system can provide only for those with children; it wants to put a roof over the heads of children who are protected by the system. Either that protection has to be taken away or social housing provision has to be extended to provide for people without children. Which option is the Minister suggesting we should take?

Mr. Lilley

There is not necessarily always a choice. Local authorities are constrained by the law and it is only right that the review should take into account suggestions, such as that from the hon. Gentleman, that the law be reviewed. If he has any specific proposals, we will be happy to consider them during the review.

The third main area of growth is housing benefit.

Mr. Thurnham

I am grateful to my right hon. Friend for giving way. I wonder whether he had time to see an article in The Times in the form of a memorandum to him asking him to visit Wisconsin to see the developments in social security systems there. It was suggested that grandparents contributed to the upkeep of children of single parents where the father and mother were not able to pay for it themselves. Would he consider the Child Support Agency looking to the four grandparents to contribute if the absent parent was unable to contribute?

Mr. Lilley

I did not see the article, although any invitation to visit Wisconsin in the coming recess will be looked at favourably. I shall rush back and read it with interest.

Mr. Graham

Will the Minister give way on that point?

Mr. Lilley

No, I have given way to the hon. Gentleman already.

The third main area of growth is housing benefit. This is partly the result of growing numbers claiming and partly the result of the switch from subsidising bricks and mortar to subsidising people. There is little doubt also that it has been particularly prone to fraud. Until recently, housing authorities had little incentive to discover fraud. Indeed, they faced a disincentive. Councils were reimbursed by central Government for 100 per cent. of the value of housing benefit properly paid out, but if the benefit was found to have been wrongly disbursed, the council was reimbursed only a fraction. Consequently, they had no incentive to discover abuses. Since April we have altered all that. Councils are now fully reimbursed for housing benefit paid out before uncovering a fraud; moreover, they are allowed to keep a share of the savings which result from identifying and stopping a fraud.

Last year, I set a target of £500 million for fraud identified and stopped by the Benefits Agency. I am happy to say that that target has been surpassed. This year, I have set a target for the Benefits Agency and local housing authorities combined to identify and save nearly £1 billion of fraud. I believe that that can be achieved. It is vital to do so, since every pound stolen from the social security system is a pound less for those in real need.

At the end of the day, the best adjunct to any social security system is a vibrant, free-enterprise economy creating jobs, wealth and opportunities for people to save.

Since we left the exchange rate mechanism, we have been better placed than any other European Community country to grow again. We have the lowest interest rates in the European Community, the lowest inflation rate for a generation and a competitive exchange rate. As a result, the European Commission forecasts that the United Kingdom will be the fastest growing economy in the Community over the next two years.

The Opposition parties refuse to recognise that growth will be undermined if we fail to tackle the deficit and if social security is allowed to outstrip the nation's ability to pay.

As the hon. Member for Dagenham has admitted, the Labour party has nothing to say across the whole range of macro-economic policy, on exchange rates, interest rates, fiscal policy, demand management and public spending. That must a fortiori include social security spending.

Mr. Dewar

Will the Minister give way?

Mr. Lilley


In conclusion, it is time for the Opposition to acknowledge that informed debate must now take the place of their party political point scoring. There is an urgent need for a public debate on the left about which objectives a welfare state should pursue. That is a task that the left has conspicuously failed to address. Those were not my words; they were the words of the hon. Member for Birkenhead and, I suspect, show greater wisdom than the reactions from the Opposition Front Bench today. Even they should now recognise that reforms of our welfare state are essential, above all in the interests of those who most depend upon it.

All parties have a responsibility to help to ensure that our social security system in future is fair, secure and sustainable. All will bring forward ideas based on their own priorities. The Government's priorities are to guarantee the position of the most vulnerable, to reduce dependency, to encourage self-reliance, to boost savings and to give people greater control over their own resources. We welcome new thoughts and new ideas and we welcome constructive debate. One day, I hope, we will also welcome those on the Labour Front Bench to participation in it.

5.17 pm
Mr. Alfred Morris (Manchester, Wythenshawe)

Seasoned observers of our proceedings will note that this debate takes place in the tiny allocation of parliamentary time the Opposition are allowed and that it would not be taking place at all but for the successful advocacy of my hon. Friends the Members for Glasgow, Garscadden (Mr. Dewar) and for Redcar (Ms Mowlam).

The Secretary of State may pretend to welcome the debate. Indeed he has described himself today as "delighted", but it is to my two hon. Friends and my right hon. and learned Friend the Leader of the Opposition that we owe this timely opportunity to debate the Government's social policies and the now rampant and still increasing public concern about them.

The right hon. Member may also want to pretend that his speech was a worthy reply to the powerful case for the motion made by my hon. Friend the Member for Garscadden in opening the debate, but he can realistically so pretend only to himself.

The Secretary of State persists in saying that we must not criticise the Government's review of public expenditure because Labour has set up the Commission on Social Justice. That is nonsense. Labour's commission is about modernising, not dismantling the welfare state. Our purpose is to perfect and put forward policies for the 21st century, not to return to those of the 19th century. The Government's review is happening in secret; the work of our Commission on Social Justice is happening in public.

At last year's election, the British people were systematically deceived by Ministers about their intentions, which is why there is such widespread bitterness against the Government now. When the Prime Minister was asked, 10 days before the election, whether there would be spending cuts if he won, he said: I see no reason to do that at all…If we were going to cut public expenditure, we would have done it before and I don't believe it is economically right. I have said that in the past and there is no need to do it whatsoever. So you can rule out any expectation of that. Only after the election did Ministers find that there were what they now call "deep structural problems" with Government spending. Suddenly there were too many old people, too many disabled people, too many single mothers, too many homeless people of whose existence the Government were previously unaware. The truth is that social security expenditure has ballooned, not because of deep structural problems with Government spending, but because their economic policies so disastrously failed.

In May 1979, when the Conservative party took office, just over 1 million people were unemployed. Now there are 2.9 million, and every unemployed person costs each of those still in work £9,000 a year. In 1979, 4.4 million people were dependent on supplementary benefit, or what is now called income support. Today, as my hon. Friend the Member for Garscadden said, the figure is an estimated 10.3 million.

Other increases in the social security budget are due to expenditure being transferred to that budget. For example, as my hon. Friend the Member for Greenwich (Mr. Raynsford) knows so well, and as the Minister has acknowledged, housing subsidy cuts mean higher rents, higher housing benefit payments and a switch in expenditure from the Department of the Environment to the Department of Social Security. Another example is that changing from child tax allowance to child benefit means not only more tax revenue for the Exchequer, but an increase in the social security budget. Thus, Ministers themselves are responsible for the ballooning of that budget.

I turn now to issues of particular concern to long-term sick, severely disabled and other vulnerable people. First, there is the recent decision of the Independent Living (1993) Fund no longer to help people with terminal illnesses. Today's debate is the first opportunity that this House has had to debate that deeply shocking decision. Ministers knew of the independent living fund decision and that it was due to inadequate funding by the Government, but made no oral comment to the House. When challenged about the decision, the Minister for Social Security and Disabled People referred in a written response to the need to target the fund's resources on the most severely disabled people in order to allow them to live as full a life as possible in the community, rather than on terminally ill people".—[Official Report, 17 June 1993; Vol. 226, c. 720.] Pauline Thompson, director of the Disablement Income Group—DIG—than whom, as the Minister knows, no one is more qualified to comment on the cold inhumanity of the independent living fund decision, condemns it as "obscene". She states: It is difficult to imagine a more severely disabling situation than that of someone who needs intensive personal care and who is also dying. Yet by distinguishing between disability and terminal illness it is now being suggested that they are mutually exclusive. Like everyone else who has seen the Minister's comment, Pauline Thompson is amazed by his suggestion that a person can be severely disabled or terminally ill, but not both.

Nick Partridge, chief executive of the Terrence Higgins Trust, whose work assists a great many people who are terminally ill, speaks of his deep concern that those in the most pressing need of help from the fund are to be excluded in order to save money. He adds: This will remove choice, create hardship, fear and insecurity for the most vulnerable group of people—those who are severely disabled and terminally ill. The Secretary of State was urged urgently to intervene to protect the interests of terminally ill people, but he has not done so. I challenge him now to defend in the House a policy condemned everywhere as heartless, for which ultimately he and no one else is responsible. The reason for disqualifying the terminally ill from help is that the independent living fund has insufficient money to go on helping them; but it is the Minister who determines its budget and I ask him now to explain what possible justification there can be for targeting the terminally ill for that unkindest cut of all.

The second issue that I want to raise is the Government's clear determination to cut spending on invalidity benefit, a subject on which the Secretary of State has said a great deal today. Anyone who has read the right hon. Gentleman's letter about that to the Prime Minister, sent to the press "by mistake" on 10 June, will be in no doubt that, for many recipients of invalidity benefit, the autumn this year will be a season of cuts and ministerial ruthlessness.

It is claimed that huge numbers of recipients are "swinging the lead", but those who make that claim should study a recent analysis by Richard Berthoud of the Policy Studies Unit. He reports: The increase has not been caused by excessive ease of entry into the system, but by difficulty of exit. What is perceived as a problem for the Government (increased costs) may actually be a problem for the claimants (inability to find work). As the Disability Benefits Consortium points out, a humane and effective way of decreasing expenditure on invalidity benefit is to improve the employment opportunities of disabled people. As of now, they are stuck at the back of the longest queue in Britain—the queue for jobs. Only 31 per cent. of disabled people are in employment. There is blatant discrimination against them by many employers, and the Government's own record as an employer of disabled people is heavily and justifiably criticised.

Far from giving disabled people more help to achieve the independence and dignity of becoming taxpayers, the Secretary of State for Employment has now announced changes to the special employment schemes for disabled people that will impose, for the first time, an obligation on employers to pay 50 per cent. of the cost of any special equipment that a disabled employee needs to do her or his job.

People with disabilities point out that this will reduce their employment prospects even further and make them even more dependent on invalidity benefit; yet the Government are hell-bent on reducing the availability of the benefit and subjecting it to tax. That would be an increase in taxation, of course, not a cut in public spending, and if increases in direct taxation are to be one of the means of reducing the Government's huge budget deficit, what possible justification can there be for starting with people who are chronically sick and disabled? Whatever happened to social fairness?

Ministers say that they are determined not to "burden" top taxpayers with high income tax, yet they have no objection to taxing invalidity benefit; nor do they hesitate to make Britain's pensioners pay value added tax on domestic fuel. All of us can see the hardship that that will inflict on pensioners. Forcing elderly people to skimp on heating can be dangerous as well as cruel, and no one can doubt that this is what the new policy will mean.

Fewer people have yet to see that the new tax is also a threat to the health and even to the survival of many babies. At a recent meeting in Manchester, Ruth Ashton of the Royal College of Midwives made it clear that new babies in the first few months of life could be put at mortal risk by the new policy. She told the meeting that the babies of parents struggling to pay heating bills will be exposed to a fatal condition—neonatal hypothermia—if their homes are inadequately heated.

The midwives that Ruth Ashton addressed are planning a national campaign to inform the British people of that threat to the lives of the children of poor families. I ask the Secretary of State to say how he will respond to that campaign and if he will meet the Disability Benefits Consortium to discuss its anxiety and concern about the right hon. Gentleman's intended cuts in invalidity benefit as they will affect disabled people.

Finally, I refer to mounting criticisms of the Government's much-heralded "new" policy for community care and, in particular, the recent findings of the Alzheimer's Disease Society, of which I am a vice-president. On 5 July, the society published a report, "Deprivation and Dementia", based on a wide-ranging survey of carers. It revealed that 41 per cent. of carers have to draw on their private savings and assets, take out loans or sell property to meet the cost of caring. It revealed also that 42 per cent. of carers need more professional help or respite care.

"Deprivation and Dementia" bears deeply disturbing testimony to the hardship inflicted on carers of people with dementia by a community care policy that is now shown to be failing carers and those for whom they care alike. For tens of thousands of carers, the reward for caring is penury as their savings disappear, their property is sold, and they have to go into often heavy, long-term debt. The report shouts the need for less ministerial sloganising about community care and for more adequate practical and financial support for Britain's carers.

There is no public saving in denying carers the help that they need, and to refuse them the right help at the right time is self-defeating. If carers can no longer cope, those whom they look after have to go into institutional care at far greater cost to the taxpayer. Not infrequently, the carer also must go into care. But to date, the Government have offered no meaningful response to the Alzheimer's Disease Society's report.

In fact, the plight of carers is more serious now than before the survey on which the report was based. I give just one example. The Independent Living (1993) Fund, as well as excluding from help people who are terminally ill, has perversely decided that everyone over the age of 65 will be ineligible for help. That, too, is a shocking decision, and one on which the Secretary of State should comment before this debate concludes.

Each of the specific issues that I have raised concerns demonstrable social unfairness by a Government who have lost not only the confidence of the electorate but all credibility. They demean riot only themselves but this House by persisting with policies that cause anguish and anger among more and more of those who elected them to power only 15 months ago.

5.34 pm
Mr. Peter Thurnham (Bolton, North-East)

I was surprised that the right hon. Member for Manchester, Wythenshawe (Mr. Morris) began by criticising the Government's arrangements for the independent living fund, which my right hon. Friend the Minister for Social Security and Disabled People introduced in June 1988. It was criticised then by Opposition Members and others for being unworkable, privatising provision for the disabled, and moving away from legal entitlement to discretionary help. In fact, the scheme has been outstandingly successful, helping 22,000 people at a cost of £97 million. To criticise the Government's arrangements for ensuring continuity comes poorly from the Opposition after they criticised the fund's establishment. It would be kinder if the right hon. Gentleman gave more credit to the Government for that scheme.

Mr. Alfred Morris

The hon. Gentleman will recall that the case made by the Opposition at the time of the fund's creation was that the disabled wanted benefits as of right. They argued that they lost them when the supplementary benefits system was terminated. My right hon. and hon. Friends merely echoed the views of the disabled. We know that the fund has done marvellous work, especially as Pauline Thompson and Sir Peter Large were involved. However, I am sure that the hon. Gentleman—as someone who takes a great interest in the disabled—joins me in regretting profoundly the decision that the terminally ill should no longer qualify for help.

Mr. Thurnham

There is no doubt that more people are helped by the ILF than were ever helped under the old arrangements. The right hon. Gentleman should acknowledge the fund's positive achievements and the money spent by the Government on residential care in general—which has grown from £24 million in 1979–80 to £2.4 billion today, which is a hundredfold increase

I am sorry that the hon. Member for Glasgow, Garscadden (Mr. Dewar) is not in his place. I share with my right hon. Friend the Secretary of State the regret that the Opposition, having requested this debate, made such poor arguments. I did not hear anything new from them or from the Commission on Social Justice. From reports that appeared in newspapers yesterday and today, I am unaware of any new recommendations. The commission apparently spent a long time analysing the situation, but decided that the thing to do is to have some cake in the first place, before worrying about how it should be shared out.

Given Labour's record in government, one can understand why that was one of the first conclusions that the commission reached. Under the last Labour Government, a married couple on average earnings, with two children, saw an increase in their income over four years of 0.6 per cent., whereas under this Government, their average weekly earnings have risen 40 per cent. That shows the difference between the way that the two parties have worked.

A number of remarks by the hon. Member for Garscadden highlighted other differences. He spoke of a real divide between the parties. There is a divide in philosophy. The hon. Gentleman seems rooted in the past, whereas we are looking to the future, to see what changes can be made. The hon. Gentleman said that he wanted to see individuals flourish in the way that the market cannot, but the market allows individuals to flourish and to use their talents to create wealth to the benefit of themselves and the whole of society.

The hon. Member for Garscadden said that two thirds of families have incomes below the national average, but I wonder how he would have it otherwise. If two thirds of families had incomes above the national average, that could only be statistically true if an extreme of poverty existed.

It is because there are extremes of wealth that we find that two thirds of families are below the national average income. If it were the other way round, we should have a desperately poor society, with some people in the greatest depths of poverty. I do not know how the hon. Member for Garscadden can criticise the fact that two thirds of families are below the national average income when talented people are using their talents to produce high incomes which they enjoy and which also provide, through income tax, support for others.

I am sorry that the hon. Gentleman is not here, for I should like to know what he thinks is wrong about a society in which two thirds of families are below the national average income. Would the hon. Gentleman like everybody to be on an average income? That is the usual way that the Labour party likes to look at things.

Ms Marjorie Mowlam (Redcar)

If the hon. Gentleman is looking for assistance, he ought to return to the point in my hon. Friend's speech where he referred to the growing gap between the very rich and the very poor during the past 14 years. My hon. Friend was not emphasising one statistic in isolation.

Mr. Thurnham

The point is that every group is growing wealthier. As I have just said, there has been a 40 per cent. increase in average earnings.

The hon. Member for Garscadden quoted at length the household survey statistics. It is worth looking at that survey. It shows that the average growth in household income was 35 per cent. above inflation between 1979 and 1990–91. It also shows that pensioners have done particularly well—average incomes of pensioner couples have risen by 48 per cent. ahead of inflation and fewer pensioners are now in the bottom 10 per cent. of income distribution.

Furthermore, the household survey shows that those in the lowest income groups have considerably more consumer goods than they had when the Labour party was in power. The percentage of households in the bottom 10 per cent. of income distribution that have central heating has risen from fewer than four in 10 in 1979 to almost seven in 10 in 1990–91, nearly three quarters of households have a telephone, compared with less than half in 1979, half have cars and 60 per cent. have videos.

Those statistics are at odds with the figures shown for income. That is why we have to look with some care at the income statistics. They appear to show that the average income for this group has fallen and then remained constant, but we must also note that a considerable number of people in this group are not declaring any income at all. Statistically, I doubt whether that is absolutely the case, unless some are living on gifts or, perhaps, criminally.

One needs, therefore, to look much more closely at the statistics. They include self-employed people. If they are just starting up in business, they may, of course, be living on their savings, and income will not show up for some years. Considerably more people are self-employed under this Government than when the Labour party was in power. That is another example of the way in which people can use their talents and flourish in the marketplace.

Some may assume that the bottom 10 per cent. includes most of the people who are claiming income-related social security benefits, but it does not. The percentage of people on income-related benefits who are in the bottom 10 per cent. fell from 31 per cent. in 1979 to 26 per cent. in 1990–91. We can therefore conclude that those in the bottom 10 per cent. of income distribution are not always in the bottom 10 per cent. when any objective measurement of living standards is made.

I am sorry that the hon. Member for Garscadden did not look more closely at the household survey. Had he done so, he would have a better understanding of it.

Mr. Wicks

I support the need for a careful look at the data, but does the hon. Gentleman agree that if we look carefully at that, we find that to use central heating as an indicator of well-being and affluence can in some cases be misleading? For example, in council tower blocks there may be very expensive under-floor electric central heating. That is no longer necessarily an indicator of well-being; it can lead to people falling into debt.

Does the hon. Gentleman agree that, if somebody is made redundant, after having been in a job that led to a feeling of security and well-being, when he or she enjoyed the benefits of central heating and all the other commodities that the hon. Gentleman described, it will not be surprising if that person, who then falls into the bottom 10 per cent. income band, still has those things but is nevertheless genuinely poor? I put it to the hon. Gentleman that a more thoughtful interpretation of the statistics reveals conclusions that he has not yet given to the House.

Mr. Thurnham

We could debate for some time the points that the hon. Gentleman has raised. There are probably fewer people living in tower blocks with under-floor electric heating now than there were when the Labour party was in power, because the Labour party was very much keener on building tower blocks, whereas we have been demolishing them or providing smaller and more individual homes. Many people in my constituency now have central heating systems that they can control themselves.

I have already referred to the fact that I am disappointed that the Commission on Social Justice has made so few real recommendations. I am surprised that the hon. Member for Garscadden did not know what Patricia Hewitt had said. If thought is being given to moving away from the contributory principle, it shows that the Labour party is beginning to think more clearly about it.

It is difficult to know where the Labour party stands on the Child Support Agency. It opposed its establishment. I should like to know what the Labour party thinks about the scheme in Wisconsin, which I mentioned to my right hon. Friend the Secretary of State for Social Security.

Is it not better for grandparents to accept some responsibility for the children of teenage single parents? Surely that is a means by which they can contribute to the welfare of their grandchildren and simultaneously exercise some influence over a child who may still be living with them when she becomes pregnant.

Mr. Dewar

I must plead my ignorance of the situation in Wisconsin, south or north, but the hon. Gentleman has obviously done some research on it. Does he think that there should be a legal duty on grandparents and that their income should be chargeable? Would it be an enforceable duty?

Mr. Thurnham

As I read yesterday's article in The Times—I have done no more research into the United States position than that—I understand that that is the case. It is an established fact now that parents have a responsibility for their children, not just up to the age of 16 but up to the age of 25, if they are students. If a young girl is living with her parents and becomes pregnant and decides to set up house on her own, I do not think that she should be able to look just to the state to house her and pay all the benefits to her without the grandparents making any contribution whatsoever.

If there were a legal duty on the grandparents to make a contribution, it would lead to the exercise of some influence over, and some sanctions on, the behaviour of couples who start a family in those circumstances, which, as I think all hon. Members agree, is not the ideal way to go about it.

The Labour party may, I believe, have come round slowly to the idea that the Child Support Agency is a good way of ensuring tht contributions are made by the father towards maintenance of the family, but I do not see why we should not look for contributions from the grandparents when the parents are unable to make a contribution.

That is one means by which we could help the children. I believe that all of us accept that the children are entirely innocent and deserve to be helped. One could therefore help the children without encouraging, at the same time, more single mothers to take a route that we all agree they should not be encouraged to go down without having given considerable thought to it.

I have already referred to the increase in the money that is being spent on residential care. Under the care in the community arrangements, a much greater variety of provision can be made available. A pilot scheme in my Bolton constituency, the neighbourhood network scheme, was undertaken. I am delighted that provision is more varied now. The new Grosvenor house, which is to open shortly, will provide day care and respite care for people who are disabled.

Nearby, in Bury, the voluntary group Brookvale runs an excellent home. It costs less than many of the neighbourhood network schemes. I know from the experience of my own son, who is there, how good the care is. It is provided at approximately half the cost of the Bolton neighbourhood network scheme. The Government should therefore look carefully at voluntary group schemes that can provide value for money and also better care for their residents.

We should he grateful to the Opposition for having provided us with the opportunity to debate this subject. I am certain that my hon. Friends will make sure that their motion is defeated and the Government amendment carried. I have paid particular attention to its wording, which is to "protect the vulnerable."

5.50 pm
Mr. Matthew Taylor (Truro)

The debate has been drawn very widely in terms of the motion and amendment, and I welcome that. It is important that the House has a chance to address the effect of Government policies on the social fabric of the nation, the sense of community on the nation and the shared burdens.

With regard to the speech just made by the hon. Member for Bolton, North-East (Mr. Thurnham), the Secretary of State had some very carefully crafted words to say on the subject of pensioners. I am not sure that pensioners in Christchurch, or anywhere else, will welcome the idea—though it certainly is an idea, and that is what the Secretary of State asked for; indeed, it is a very radical idea—that, in addition to liability for VAT on fuel, they should also be burdened with direct financial liability for their grandchildren. It is a principle that could be extended, but I doubt that it is a popular one. Nor do I think that it will solve the immediate problems of society at the present time.

We are holding this debate at a time when, partly because of some of the ideas that have been raised by Ministers, some of them now batted down again by the Secretary of State, the Chancellor and others, the Government are deeply unpopular and the Prime Minister's ratings are lower than any since polling began.

That will not, I suppose, unduly worry hon. Members on this side of the House, but I believe that there should be general concern about the decline in trust and faith in the political process in dealing with the kind of problems that we are addressing in this debate and the very real issues that have been raised in all parts of the House.

As the leader of my party said in a speech to Charter 88 last week, there is not just a crisis in Government, policy or leadership; there is a crisis of lack of faith in the system to overcome these problems. Indeed, in all fairness to the Prime Minister, successive Prime Ministers have fallen to the lowest ever ratings of popularity as time has gone on, reflecting not just an attitude to their individual policies, but a long-term decline in belief in the ability of the system to sort out these problems—a sense of the break-up of social cohesion, a sense that the system is not capable of delivering solutions.

I accept, therefore, that it would be foolish to hold the Government solely responsible for that situation. But, with a record in government stretching back 14 years now, and with the decline perceived to have occurred over those years, the continuing threat of the Government's policies must be judged to be significant.

Is it surprising, after all, that the most vulnerable in society, those who are dependent on the benefits system, find it hard to trust politicians when, within 12 months of getting elected, the Government are coming forward with a set of policies—some of which we heard from the Secretary of State for Social Security earlier—that directly contradict much of the platform on which they fought the election?

There was no mention then by the Prime Minister of the imposition of VAT on fuel, which will hit those people in particular and for which the Government have been unable to promise full compensation. The Prime Minister said that he had no need to extend the scope of VAT. Yet that is exactly what he did, and now we learn that he is contemplating going further.

Mr. Hendry

The hon. Gentleman referred twice to trust. Given the fact that a year or so ago a Liberal party document argued specifically in favour of ending the anomalous zero rate of VAT on fuel, and that the Liberal Democrats have now voted against that policy because there is a by-election going on, what contribution does he think that his party has made to improving trust in politics?

Mr. Taylor

There is a very simple difference between what the Liberal Democrats said and what the Government said. The Liberal Democrats, in a green paper policy document, raised the possibility that one way of tackling environmental problems was by the imposition of VAT on fuel. That went to conference, was not accepted by the party, and was rejected specifically in the manifesto. Indeed, in the manifesto we specifically proposed using carbon taxes to cut the rate of VAT. The Government, on the other hand, specifically rejected the possibility of putting VAT on fuel in the run-up to the election, and then did it in practice.

I feel no embarrassment about this; the embarrassment should surely be felt by those on the Government Benches for having said that they would not do something which they subsequently did, rather than having discussed something, as we did, that we subsequently rejected through the democratic processes of the party. We saw that it was not a good idea. It is a pity that the Chancellor did not come to the same conclusion.

This extension of VAT to domestic fuel in the form in which the Government are undertaking it will cause most distresss to the most vulnerable: the elderly, those with disabilities, and those on low incomes—precisely the groups which the Secretary of State made it clear that he was targeting for cutbacks.

What I believe has most astounded people is that, when they said an overwhelming no to the VAT plans in the county council elections and at Newbury, the Prime Minister sacked the Chancellor who had implemented the policies that he had set, yet made it clear in the same breath that he was sticking by the policies that had led to the Chancellor's downfall, and indeed proceeded to whip this through the House—

Mr. Deputy Speaker

Order. This is very wide of the motion or the amendments on the Order Paper.

Mr. Taylor

I am happy to take your advice, Mr. Deputy Speaker, but the Opposition motion, Government policies, the social fabric and the security of the individual", is framed in terms of the social policies of this Government which have resulted in an ever widening gap between rich and poor, and the destruction of opportunity". Surely, the imposition of VAT is precisely in line with that. I may misunderstand what is written on the Order Paper, but that is what it says. The Government amendment is framed in terms of social security specifically, but the motion before the House is not. I am happy to take advice on this.

Mr. Deputy Speaker

As the hon. Gentleman knows, we had a full debate on VAT policy only a week ago. Until now, I have heard hardly a word this evening about VAT on fuel. It is appropriate to refer to it, but it seems to me that the whole thrust of the hon. Member's speech so far has been on that.

Mr. Taylor

I am making the point that this is falling hardest on those who are in receipt of benefits and are the poorest in our society. If we are to look at the benefits system, we have to see what those people are having to pay. I am not quite sure how we can make the point without looking at the costs. The Secretary of State for Social Security ranged as wide as housing issues, children, and so on. I seek only to do the same, and if you will allow me to continue, Mr. Deputy Speaker, you will see the way the argument develops.

Mr. Deputy Speaker

I am enormously grateful, but the hon. Gentleman has had eight minutes in which to develop this.

Mr. Taylor

The perception is that the Chancellor, in introducing policies and refusing to give a guarantee that people will be fully protected from those policies, is continuing the process in which those who are at the bottom of the scale—those on benefit, including invalidity benefit, and those on pensions—are having to bear the consequences of the Government's policies, while those who benefited through tax cuts at times when the economy was doing well remain protected. This goes to the very heart of the social fabric of our society.

It is a set of policies and a position which the Secretary of State for Social Security reflected again this evening. It will widen the gaps and the divides, and destroy the faith of those most dependent on Government policy that the Government have any real intention of defending them.

Our position has been very clear. The Government seek to cut invalidity benefit and talk in terms of changes to the pensions system and reviewing the basis on which benefits are awarded in order to close the Government's financial gap. We argue that while, of course, where there is fraud or wastage, it should be tackled, the primary responsibility of the Government in tackling their financial problems is to look to those who benefited most over the last 14 years from Government tax cuts, not those who have already been so squeezed by policies which have continued to increase the burdens on them.

The same is happening in other areas, with those mostly dependent on the benefits system being hit by the changes that are taking place. Rising prescription charges and the imposition of charges for sight tests are having a great effect. Opticians in my county of Cornwall have written to me in recent weeks referring to people having lost their sight as a result of their inability, because of low incomes, to meet the cost of sight tests, or at any rate their belief that they could not pay for the tests.

The recession, which has done so much damage to the economy, has without doubt increased the jobless level. The Secretary of State's figures reveal that the financial problems that he highlighted would be met by growth of 2.5 per cent. and a reduction in the unemployment total to 2.25 million, which even at that level would be more than double the figure that the Conservatives inherited in 1979 and which they claimed they would reduce.

The Government talk about ways in which benefits that are now received by those who most rely on them can be cut, with scarcely a word—just as in the Chancellor's speech there was hardly a word—about how the Government could tackle the fundamental financial problem of unemployment. The degree of unemployment has resulted in an insufficient number of people being able to earn the money to pay for the benefits of those who most need them in the social security net.

The Secretary of State referred to the problem of homelessness, a problem that is now faced country wide, in inner cities and rural areas. I asked the right hon. Gentleman what he proposed to do about the present state of affairs when young people looking for affordable social housing are told by housing officers that their only chance of getting the necessary points to make them eligible is to have children. That does not mean having just one child, as those with one child are often told that they will need two or three children to have any hope of obtaining social housing.

I am not saying that officers are advising people to have children. They are simply Clarifying the situation in relation to the impact of the shortage of housing and the way in which the points system works. The Minister rightly said that it was not a sensible system. That being so, he must clarify the choices because the system is designed to protect children by ensuring that they have a roof over their heads. I stress that the system is designed to protect children, not parents. Either the Secretary of State is suggesting that we should no longer offer that protection to babies and children in that situation—they are in it through no fault of their own—or he must accept that we should expand the availability of affordable social housing so that those without children have a realistic chance of obtaining homes.

It is a simple choice, but the Minister ducked it when he was questioned about it. It was a bit rich for him to duck it, when he criticises other parties for not putting forward policies to tackle the problem. In fact, both Opposition parties have put forward policies to deal with the matter. Liberal Democrats in particular have been clear about the policy and how it should be funded. The Secretary of State, who now has responsibility for the issue. has failed to put forward sensible ideas to deal with it. He hides behind reviews and refers to the need to listen to radical ideas, but without so much as putting a finger into the wind to see the way opinion is blowing.

If the right hon. Gentleman continues to fail to announce the necessary action, or if he will not take action because he prefers the option of not providing a roof over people's heads, of cutting back on invalidity benefit and support for the unemployed, of reducing pension provision and, as he hinted, of making women wait longer to become eligible for pensions, he should say so and not criticise others for raising scare stories, as he put it, all of which have arisen through the comments of his hon. Friends.

When I was in the west end a few nights ago, I came across a couple of teenage girls sitting in a doorway. They were both clearly homeless. They were begging. Some people walked past them, averting their gaze, a few gave a little cash and others stopped to talk to them, probably to ask how they came to be there. They were certainly too young to be in that situation late at night. I recall that they were examining each other's arms, comparing flea bites. I imagine that there is no chance of any of the daughters of hon. Members finding themselves in that situation. Most people are insulated from such events happening to their families. Buts some are not. Those youngsters are among the people who look for social housing. In most cases, for the reasons I have given, they are unlikely to get it.

Can those people hope for financial support from the state? They will certainly not get it automatically because the Government have removed any automatic entitlement to financial support in such circumstances. What chance do they have of obtaining employment? Without a place to live, they have little chance. Indeed, an employer would take one look at the flea bites and probably decide that it would not be a commendable idea to employ such a person.

The Government may suggest that youngsters in that position should return home, but the statistics show that, by and large, the homeless come from broken families, that they have often suffered abuse or that they have been brought up in care by the state or local authorities. In other words, they have no homes to which to return.

By dodging the basic breakdown in the community that has occurred, the Government are causing a rift in the social cohesion. By so doing, they are dodging the real agenda that must be set. They talk simply of cuts. We have made our position clear. We have said that where the choice is between invalidity benefit and fair taxation, or between VAT and fair taxation, our choice is for fair taxation. After all, such taxation falls on the community as a whole. That is far preferable to cuts which fall on those who can least afford them. The same applies to additional VAT burdens being applied to the poorest in the community. The choice is clear, and I know which way my vote will be cast.

Mrs. Angela Browning (Tiverton)

I am interested to hear that the hon. Gentleman has a taxation proposal to cover the cost involved. I should like to know how it would be spread across the burden of taxation, the figures that would relate to that, how much revenue would be raised and how it would be spent to solve the problems that my right hon. Friend the Secretary of State identified.

Mr. Taylor

The hon. Lady has posed many questions and I fear that it would take a considerable time to answer them all. I am loth to do that as I come to the end of my remarks. At each Budget we have set out our proposals in detail, including what we would spend and how the revenue would be raised. I am sure that we shall repeal the exercise in November.

The principle of our proposals is not that we would impose burdens—for example, through VAT—on those least able to afford them or that we would cut benefit to the disabled. We would ask the country as a whole to share the burden. I suspect that, if the hon. Lady knocked on doors in her constituency and asked people what they preferred, they would reach the same conclusion. Her constituents of all political persuasions would support our policies in response to the financial problems that have arisen as a result of Conservative policies.

6.8 pm

Mr. Charles Hendry (High Peak)

I am grateful for the opportunity to contribute to the debate, although I am surprised that the subject should have been chosen for this Opposition day debate. I can think of only two reasons for that. The first is that it is a bit of cheap public relations activity for the Commission on Social Justice.

As the Secretary of State said, it is the first time that an Opposition party—or, indeed, any other party—-has decided to contract out its policy-making activity— [Interruption.] The leader of the Labour party said that nothing would be ruled out when he set up the commission. Apparently, the only thing that has been ruled out is the concept that the party in opposition should have any ideas of its own.

The cat is now out of the hag, because, much as the Labour party would like to keep people quiet, some Opposition Members have ideas of their own and are willing to express them. An entertaining sight this afternoon is watching them scurrying around looking for new arguments and ways of saying that they do not disagree with each other, at the same time as making it clear, by their choice of words, that they do not agree with each other either.

The second reason that I assume the Opposition chose this subject for debate is that we are near the end of the Session and they are running out of ideas because the ground is shifting. A few weeks ago, they would have suggested debating the economy, but it is turning around so fast that they would not dare to do so now. They would have suggested debating unemployment, but unemployment has fallen for five months in a row. They might have said, "Let's debate manufacturing productivity," but only this week there has been the biggest leap in manufacturing productivity for many years so they would not dare to debate that either.

I therefore have some sympathy for the Opposition as they scurry around trying to find new ideas to debate. One feels that they have no choice but to descend from the real world into the gutter in order to find a debate in which they can spread fear and scare stories.

We heard such a story from the hon. Member for Glasgow, Garscadden (Mr. Dewar), who spoke about the base rate pension but did not mention the fact that the people who receive only the base rate pension receive income support to top it up. Targeting more help on poorer pensioners has been one of the Government's priorities.

The hon. Gentleman also omitted to mention the dramatic growth in recent years in the income and earnings that pensioners receive from sources other than their pensions. If he wanted to be fair and honourable—I am sure that it was genuinely his intention to be so—he should not have overlooked such factors.

I warn the Opposition that, if one descends into the gutter, one should be careful not to trip over the Liberals who have already been there for some time. I was astonished by the speech of the hon. Member for Truro (Mr. Taylor). This is the first time in my 15 months in the House that I have heard a speech that bore no relation to the subject for debate and which was not directed at the House—

Mr. Deputy Speaker

Order. The hon. Gentleman's speech did bear a relation to the debate. One part strayed a little, and I drew his attention to that fact, but, thereafter, I thought that it was well in order.

Mr. Hendry

I accept your guidance, Mr. Deputy Speaker, although I fear that, even as I speak, a press release is winging its way to the Christchurch Bugle and Echo, because the speech was perhaps directed not at the hon. Gentleman's constituents or the House but at the electorate in the forthcoming by-election.

I was grateful, however, for the attention that the hon. Member for Truro paid to the problem of homelessness. I am joint chairman of the all-party group on homelessness, which would welcome any Liberal Democrat Member of Parliament who cared to come to one of our meetings. We have had representation from another place hut, in the year that I have been joint chairman, I cannot recall one Liberal Member of this House coming to our meetings.

The true scandal of today's debate is the fact that the Opposition should have chosen for debate the subject of the breakdown of our social fabric. It is rather like King Herod asking why the number of children in primary schools has dropped off. No one has done more than the Opposition to undermine this country's social fabric. They make great play of the fact that the Conservatives have been in government for 14 years but, in order to trace the roots of the decay and the problems which have been undermining this country, one must go back not 14 years but 20 or 30 years beyond.

I accept that various parties were in government during that time. It is easy for the rot to set in, but it takes a great deal longer to stop it and then to turn things around. I shall deal with those issues directly.

I believe that the greatest crime of socialism was to take away from people the responsibility for their own affairs. It took a terrible arrogance to say that people could not decide matters for themselves and that we, the elected officials and the Government, knew better how to run their lives than they could possibly ever know.

It was the patronising approach. People were told not to worry about education or health, because all the decisions would be made for them. They were told not to worry about housing because wonderful tower blocks would he built in which they could live and be happy. They were told that they would be looked after when they were young and old, well and sick. The problem was —

Mr. Stuart Randall (Kingston upon Hull, West)


Mr. Hendry

Let me finish this point.

The problem was that socialism created a society in which more and more people became reliant on benefits. Only a few days ago, one of my hon. Friends said that the benefits society was a Santa's grotto in which everyone expected a handout, but Labour's grandiose plans broke the bank, and the people who have suffered most are those whom Labour purported to he helping.

Mr. Randall

Does the hon. Gentleman not accept that Baroness Thatcher's philosophy that there was no such thing as society and that one therefore had no responsibility for others revealed a terrific irresponsibility?

Mr. Hendry

If the hon. Gentleman listens to the remainder of my speech, he will hear what I have to say about rebuilding a sense of social cohesion, which requires the Government, local authorities and the people to work together.

One of the areas in which the social fabric has been most challenged in the past 30 years is the inner cities. Thirty years ago, they were the powerhouse of our economic activity and the driving force behind much of our growth and wealth creation. Then, for various reasons, they began to decline. In every case, the decline can be traced back to socialist policies—[Laughter.] Hon. Members may laugh, but it is true.

Labour's high rating policy drove out of the inner cities those who could afford to move to the suburbs. My constituency, positioned between Sheffield and Manchester, is a case in point. Many people moved to the peak district, to Derbyshire, because they wanted to escape the high rating policies of Sheffield and Manchester.

They were often those who ran the businesses, and their next step was to decide that, rather than commute into the city every day, they would move their businesses. If they built a new factory, they did so in the suburbs so the jobs moved too. Very often, their wives taught in the local schools and, instead of teaching in the cities, they taught in the suburban areas. The fabric of the cities was completely undermined, and they gradually fell into a cycle of decline, deprivation and despair.

Some of the sink estates in the inner cities began as paradise but ultimately became prisons. If Opposition Members want to know why some of the people living there turned to crime, drugs and prostitution, they should not look at what has happened in the past 14 years but have the courage to go back further, to the policies they advocated, which the Commission on Social Justice itself will challenge. That is where the seeds of decay were sown.

One might have assumed that the Labour party has chosen today's topic for debate because it had some constructive policies to rebuild social cohesion in the cities. It is startling, however, that, each time in the past 14 years that the Opposition have had an opportunity to support a policy to tackle decline, they hayed voted against it.

They voted against urban development corporations and, in some cities, they made things as difficult as possible until they realised that the corporations were here to stay. They voted against the Government's inner-city task forces, and Labour local authorities often refused to co-operate with them. They voted against plans to develop derelict land and bring back life to inner-city areas: they voted against city technology colleges and training and enterprise councils, and against a range of policies designed to bring hope and to reverse the decline. Every time they have had the opportunity to do something constructive, they have backed away.

Ms Mowlam

The hon. Gentleman spent some time saying that decisions should not he dictated from the centre, and that the Government should not he heavy-handed. He says that people should decide for themselves, but to whom are the training and enterprise councils and the development corporations accountable? They are controlled centrally from Westminster and Whitehall.

Mr. Hendry

I had hoped that the hon. Lady and her party had learnt something over the years. The TEC in my constituency offers the best training available in Stockport and High Peak. There is a cast-iron commitment that every 16 and 17-year-old who cannot find employment or a place at university will have a place on a training scheme. The system works. Businesses are actively involved—

Mr. Graham

Will the hon. Gentleman give way?

Mr. Hendry

No, I am answering the hon. Lady.

Businesses are actively involved in assessing their own training needs and ensuring that those needs are met. The development corporations have revitalised parts of inner-city Sheffield and Manchester. For the hon. Lady to try to undermine their work once again shows how little the Labour party has learnt from its 14 years in opposition.

Another issue of concern to my constituents and people throughout the country is crime. Every time the Labour party has had a chance to show that it wants to take a stand against crime, it has backed away from doing so. People would not be surprised to learn that Labour Members are, in many ways, the criminals' friends. In my county council, the police have been undermined. Labour party policies too often ensure that accused people have all the cards.

The Opposition take a soft line on sentencing. If we followed their policies, our present crime problems would be infinitely worse. If Labour Members would vote with the Government now and then to support an integrated and cohesive approach to tackle crime, we would make further inroads into that serious problem.

In my capacity as joint chairman of the all-party group on homelessness, I want to concentrate for a moment on the issue of housing, which is crucial to our social fabric. In the past 14 years, 2 million new houses have been built in this country. But even more are needed, partly because people are staying alive longer and partly because of the social breakdown. However, I am sceptical about how many new houses some people say need to be built every year. Sometimes that figure rises to 200,000, but that would be excessive if two steps could be taken.

First, we need to make better use of existing housing stock. It is scandalous that 75,000 empty properties are owned by local authorities.

Ms Mowlam

Here we go.

Mr. Hendry

The hon. Lady is familiar with the list that I am about to cite, but somehow the figures do not change.

In Liverpool, 9.6 per cent. of the local authority's housing stock is empty. In Manchester, that figure is 6.5per cent., and in Brent it is 5 per cent.

Mr. Randall

What about the Government's housing stock?

Mr. Hendry

I shall discuss the Government's housing stock in a minute.

We are then told that the houses are empty because those local authorities do not have the money to repair them. In those same local authorities, rents are not being collected. Brent, Liverpool and Manchester each has £15 million of uncollected rent arrears. If they bothered to act as good landlords, they would have the money to return their housing stock to a good condition.

Labour Members mentioned the Government's empty houses. They will be aware that some 10,000 Government-owned properties are empty and, if they have read the Official Report, they will know that I have tabled some 20 parliamentary questions to my hon. Friends in the Ministry of Defence, encouraging them to do more to free some of their empty houses for homeless people. I would welcome support on that issue.

Mr. Graham

Will the hon. Gentleman give way on that point?

Mr. Hendry

I wish to finish my sentence before giving way to the hon. Gentleman.

Under my right hon. Friend the Minister for Housing, Inner Cities and Construction, the Government have set up a task force that is determined to crack down on that problem and ensure that every Department does all that it can to reduce its housing stock. I hope that the hon. Member for Renfrew, West and Inverclyde (Mr. Graham) will say that he will encourage his local authority to cut down its housing stock in the same way.

Mr. Graham

I assure the hon. Gentleman that I help the local authority in every way possible. He is probably not aware that members of the armed forces and their families, and people who work in, say, the royal ordnance factories for the Government, do not receive the discount allowances granted to council house tenants. Perhaps the hon. Gentleman could agitate to ensure that Ministry of Defence employees get the same discount that is available to local authority tenants. If he does so, he will be doing them a service.

Mr. Hendry

If the hon. Gentleman reads tomorrow's issue of the Official Report, he will see the answer on that question, which has been given to me today. It does not directly address that point, but deals with the number of sales that have gone through. Of 70,000 applications, 1,500 sales have been completed. So I shall table a question further to that one to find out why the number is so small, and I look forward to the hon. Gentleman's support on that matter.

Another problem is empty private houses. The total number of local authority, Government and private houses amounts to some 800,000 empty houses—which, on a simple mathematical basis, amounts to five empty houses for every homeless family. We need to bring many of those houses back into use if we are to make significant strides in tackling the problem.

We also need to consider the allocation of those houses to different people. I wish to comment on some of the areas on which my right hon. Friend the Secretary of State touched in relation to single-parent families. I shall begin by considering what is in the best interests of young single parents, particularly teenagers, and their children.

I can think of nothing worse than a 16, 17 or 18-year-old with a young baby being shoved in a council house, perhaps in a part of town that he or she does not know well, without friends in the neighbourhood, and without social or other support to give the child a good start in life. It would be much better to see whether different forms of support for single parents could be established.

The knock-on effect is that, in my constituency and elsewhere, many families have been on the waiting list for three, four or five years, yet they scarcely seem to move up the list. Their children are growing up and need more space, but they can never move because other people are always popped in the housing list as priority cases and go to the top.

I do not suggest that mothers become pregnant deliberately for that reason. I was intrigued when the hon. Member for Hampstead and Highgate (Ms Jackson) referred the other day to mothers "making themselves pregnant". That is an interesting biological concept, but she is a lady who knows more about those matters and can probably enlighten me on how it can be done.

We should be able to do more to help families on the waiting list. First, local authorities should question the genuine eligibility of people who say that they have been evicted from their homes, to ensure that it is true. Secondly, we should see whether we can make greater use of shared accommodation. Hostels have a negative connotation, but shared accommodation in which we could bring together four, five or six single parents, for whom social support can be provided, or who can provide it for one another, must be better than leaving them in isolation.

We could also see whether more could be done to encourage young people to stay at home with their parents. It might be worth looking at the idea of paying parents a contribution to recognise the costs involved. Although I accept the Secretary of State's comment about not wishing to incur greater expenditure now in the hope that, in years to come, we may reduce it, such a policy would significantly reduce expenditure this year, because single parents would no longer have to claim housing benefit. They may be more able to go out to work, and would require less income support. Moreover, another family could be moved out of bed-and-breakfast accommodation, thereby saving the huge costs involved.

Mr. Michael Stephen (Shoreham)

Will my hon. Friend comment on the position in my constituency, which is not an isolated case, where a father came to my surgery and said that he had a five-bedroomed house where he lived with his wife and daughter? His daughter would not accept the reasonable rules that he and his wife laid down, so she went off to the social services to declare herself homeless. She is now accommodated in a council flat, having been made a priority case and put on the list above people who have been waiting for a long time. That not only deprives people of a home but undermines parental authority.

Mr. Hendry

My hon. Friend raises a point that is familiar to many of us, and the ideas that I have outlined would go some way towards tackling the problem. First, we should question whether the person is genuinely homeless and evicted; secondly, we should try to find more attractive ways to support single parents.

The most startling aspect of this debate is that the new ideas come not from the Opposition but from the Conservative party. Those include the flats-above-shops initiative; the rough sleepers initiative, which has reduced the number of people sleeping rough by two thirds in the past two years; the concept of private sector leasing, which has reduced the number of families in bed-and-breakfast accommodation by nearly 40 per cent. in the past year; the pilot schemes for concepts such as foyers, with an integrated approach towards accommodation, training and getting young people into work; and pilot schemes on rent deposits.

The ideas are being generated by the Conservative party. specifically from my right hon. Friend the Minister for Housing, Inner Cities and Construction, which is why we are, for the first time, seeing such a welcome drop in the number of homeless people. The same applies to the wider issue of social security. The policies that the Government have pursued and the ideas that have come from the Conservative party show that we are the party that is looking to the future.

More support is being given in social security than ever before. Over the past 14 years, the sum has increased by 75 per cent. to £80 billion. My right hon. Friend the Secretary of State has given the figures clearly. Above all, rather than spreading the money thinly—the hon. Member for Garscadden said that that was his approach to the basic rate of the state pension—the Government have tried to give more help to the people who need it most, by giving £1 billion to less well-off families, and an extra £1 billion over the past four years to less well-off old-age pensioners.

The Government have also targeted more attention on creating better incentives to work. There is still a small poverty trap, whereby people may earn more money without being much better off, but at least people now make some gain, whereas, before the Government's social security reforms of 1986–87, people were significantly worse off when they went to work. The Government have now removed that disincentive.

The Government are also taking a lead in encouraging personal responsibility. Five million people are now investing in personal pensions, and, through the Child Support Agency, absent fathers are being encouraged to take responsibility for their children.

All those ideas have come from the Conservative party. We, rather than the Labour party—even with their Commission on Social Justice—are the party trying to generate policies for the rest of the decade, policies that will take us into the next century.

When we talk about help for those who need it, and about the social fabric, it all comes back to economics. The Conservative party will tackle the problems better than the Labour party, because we have a better understanding of how wealth is created. We believe in stable rates of tax, rather than in increasing taxes, which would snuff out the recovery. The Labour party talks about an investment-led recovery, but at the same time plans a super-tax on the privatised utilities that would kill off their investment plans for several years to come.

We know that, if we want more jobs in this country, we should reject policies such as the social chapter, and adopt policies that reduce bureaucracy and red tape. That is why the economy is now turning round. My local experience tells me that it is turning around much faster than the official statistics suggest—[Interruption.]

The hon. Member for Garscadden may laugh, but he should come to my constituency and visit the heavy engineering factory making industrial cranes, where production has increased by 20 per cent. since last September. Two of my four largest employers have taken on more people this year than they laid off last year. Unemployment is falling, because there is a manufacturing-led recovery.

If we wish problems such as those mentioned in the motion to be tackled, we must have economic recovery, and the policies being pursued by the Government will bring that about. Moreover, we must look to the future, and we must have the vision and the courage of our convictions to develop policies, rather than contracting that out to some independent commission.

6.32 pm
Mr. Tony Benn (Chesterfield)

The social fabric of this country is being destroyed by unemployment, which is ruining the lives of millions of people and denying the country the wealth that those people could create if they were employed. Unemployment is creating terrible hardship not only for individuals but for whole families. It leads to the breakdown of marriages and to many of the crimes that worry us as Members of Parliament.

If the debate can perform any function at all, it is to try to explain to the people who may hear it or read it why that has happened. The truth is that unemployment is Government policy. It is no good saying to Ministers, "If only you did this, that or the other, you would get back to full employment." Ministers do not want full employment. Unemployment lowers wages, undermines trade unions and creates a dependent society in which everybody is terrified of his or her employer.

I appeared on "Newsnight" on the BBC the other night, and the woman who did my make-up, whom I have known for some time, is on a one-day contract. What security does she have?

Conservatives talk about a dependent society as if claiming social security when one is unemployed after having worked for 30 years and paid for it were a sign of a dependent society. Yet the Government want to pursue a political strategy, not an economic strategy.

If they had had an economic strategy, they would have spent the North sea oil revenue re-equipping our industry. I was Secretary of State for Energy when the Forties field was discovered, and it was so rich that British Petroleum, which discovered it, amortised the entire debt—at a cost of £700 million—in 18 months. This country has had £100 billion in revenue from the oil. Where has it gone? It has all been spent on unemployment pay.

When one travels around talking to people and listening to them, one finds many skilled engineers working in shops, driving taxis or unemployed. We are the only country in the world that has used oil revenues not to train taxi drivers to be tool makers but to turn tool makers into taxi drivers. That has been a deliberate policy, and it has created exactly the society that the Government want. Their policy has not been an economic strategy for growth.

The other day, somebody showed me a copy of "Business" magazine from 1986. Its leader said: British business is getting better … If you decide to set up on your own, you would be well advised to avoid manufacturing. The big bucks are almost all in importing and marketing". Over the page the magazine cited two brilliant business men, Octav Botnar and Asil Nadir. Those were the examples for the 1980s.

The Government are engaged in something that they never admit; they are taking us back to a Victorian society in which the people who create the wealth are on their knees from fear, and those who have the whip hand can impose anything that they like on them. Having been in Parliament for 43 years, I am not surprised that that is what Tory Members want. For my sins, I am paid to watch them, and I have watched them from the beginning—although they were a much nicer bunch in 1950, in the days of Winston Churchill. Conservative Members have always made speeches such as the one which we have just heard from the hon. Member for High Peak (Mr. Hendry).

What worries me, and what should worry my hon. Friends and others listening to the debate, is not why the Tories do that to us, but why people let them do it to us. That is the real question. I have never been in favour of attacking individual Ministers; they do that to each other more effectively than I can. Nor am I in favour of the habit of demanding the resignation of a Minister every day, because I do not think that resignations make much difference. The Ministers go, but the policies continue. However, the House is part of the media, in a way, and I am in favour of trying to get to the root of the question, if that can be done. What is it that leads people to accept a policy so grossly unjust and so massively wasteful of human resources?

The answer is that, for the past 14 years—although I believe that what is loosely called Thatcherism began earlier than 1979—people have been told that profits matter more than people. That idea has been implanted, spread and endlessly repeated. During the election campaign, I met a lad in Staveley, in my constituency, who said, "I am not voting Labour this time, Mr. Benn." I asked him why and he replied, "I have got some British Gas shares." When I asked him how many shares he had, he said that he had £100-worth. I asked him whether he had a job, and he said no. I said, "If you had a job, you might get £100 a week." But because he had some shares, that lad had become a Conservative.

The idea that that is what life is all about is constantly repeated. An example that comes to mind is the use of the word "customers". We get on the train and we hear, "Will customers who boarded the train at Derby please take care of their baggage?" I said to the ticket collector, "I am not a customer; I am a passenger." He said, "No, you are not; you are a customer." If I go to hospital, am I a customer for an operation? If I am hauled up before the magistrate, will he call me "customer at the bar"? Does the Archbishop of Canterbury talk about "dearly beloved customers"? Does the Queen, in her Christmas broadcast, refer to -our customers here and abroad"? [Laughter.]

Hon. Members may laugh at that idea, but I can tell them one thing about a customer: one cannot be a customer if one has no money. By turning people into customers, we depersonalise the poor, whose poverty has been created by the policies in which the Conservative party believes. The BBC does that more than anyone else. Do hon. Members listen to Dominick Harrod on "The Financial World Tonight"? He gabbles on night after night about the value of the pound sterling to three decimal points against a basket of European currencies. Next time I go on holiday to the continent I shall take a basket of European currencies; it sounds a handy thing to have.

Then we hear that, because the pound has dropped by three decimal points, the Government say that we have to close a hospital to restore confidence. Witchcraft has been propagated. It has nothing to do with the real economy whatever. I have never seen pensioners hurrying out in the morning to sell their deutschmarks and buying kruggerrands because Dominick Harrod has told them what has happened to the Dow Jones industrial average. Such poison has been injected into the Government.

I have never been frightened of what legislation Prime Ministers can get through, because if there is a large enough majority, all the legislation can be repealed in 24 hours. However, the ideas outlined in recent speeches from Conservative Members have done enormous damage.

Those ideas have spread to the public services. I recently visited the beautiful new Royal hospital in Chesterfield, and was taken round by the unit manager—

Mrs. Browning

Who paid for that?

Mr. Benn

It was authorised by the Labour Government, by my predecessor Lord Varley, who has now moved from sharing our opinion to Lloyds bank, which is his problem.

I was shown around the hospital by the unit manager, who is a chartered accountant, and we arrived at the premature baby unit. The nurse and the sister were present and the unit manager leaned over and said, "Mr. Benn, this is the most expensive end of the business." If premature babies are a business, they are all uneconomic units, because I have never met a premature baby who has contributed any wealth at all. Pensioners are all uneconomic units, too. Before one knows it, the young and the old are also non-persons because they do not create wealth. The people who create wealth cannot be asked to pay any more tax, so the people who are dependent will be the victims of the policy that has been outlined.

The Government are doing the same in schools. Head teachers must now decide whether to hire a teacher, have the school cleaned or get the windows repaired. A whole new bureaucracy has been created.

If one rings up a doctor, he will say that he is afraid that he may have exceeded his budget for the current quarter. When will the day come when, on ringing the fire brigade, it says, "Don't tell us about the fire, because we have used our quota until the end of March"? If business principles are applied to public services, those services are destroyed. Of course, that is exactly what is happening.

I was invited not long ago to a school in Chesterfield where there was a class on business studies. I thought that it would be interesting. When I got there, the teacher, who was rather shy, said, "In the old days, I taught social studies, but, as you know, Mr. Benn, that is illegal now, so I teach business studies."

I asked the teacher what project the children were studying. She told me that the project was that the school was closed by the local education authority and the class had to try to maximise the profit from the sale of the school. She pointed at one youngster and told me that he was an "estate agent"; she pointed to a young girl who was a "property developer"; she pointed at somebody else who was "the head of a construction company"; and then she pointed at the most miserable child in the class and said that he was the head teacher and that they were trying to improve his redundancy pay.

I asked the class, "Is it about the maximisation of profit?" "Yes, yes," they said, hoping that the teacher would notice. So I asked them, "Have you considered prostitution, because that is very profitable? Have you thought about making flick knives in the school laboratory for the football fans of the country? Why not open your playground to toxic waste from all over the world? You would make much more money from those schemes."

The teacher's face fell a mile, so I asked the children if they wanted the school to close. "Close the school? No. We love it," they said. "My grandfather was here, my auntie was here, I enjoy it and my sister is hoping to come." I asked them why they did not drop the whole damn silly thing and instead campaign to keep the school open. They could lobby in Matlock, ring up Radio Sheffield, get on to the Derbyshire Times or come to London to see hon. Members.

Then I realised that a whole new generation of young people are being infected with a vicious, lousy virus that profit is more important than their education. It is like going to Pakistan, where the Islamic republic idea is pumped into the children, or it is like Moscow under Joe Stalin. That is what is happening, and that is the cause of the trouble we face. Such ideas have infected the whole of society—they are the values of capitalism.

I am proud of being a socialist, and I will always remember one of the most socialist things that we ever did was also the most popular—creating the national health service. I am the last remaining Labour Member in the House who heard Aneurin Bevan, as Minister of Health, make his resignation speech. He resigned because the Government put charges on teeth and spectacles.

The health service was socialist not because of who owned the buildings but because people had access to medical care on the basis of need, not wealth. The Government are utterly resolved to destroy that principle by trusts, by fund holders, by pushing it out to private practice and by destroying the national dental service. Do not think that is popular, because most people in the country believe that health is a national interest.

I remember my dad saying to me once that the pre-war Liberal Government of 1910 made the nation's health a national interest, and long before the health service. I thought that that was silly and that everybody knew that, but that is no longer true. The nation's health is an optional extra like white-walled tyres. People buy treatment if they can afford it, and if they cannot. they go down to a lower grade. [HON. MEMBERS: "That is not what it is all about."] Of course that is what it is about. People who wait for medical treatment are told that, if they go private, they can jump the queue.

What about dental care? I do not know who Conservative Members meet. I met a man who was waiting for months for a prostate operation. If he had had the cash, he would have had it done tomorrow. Do not tell me that the Government are not destroying the national health service.

The only way in which we can change such a course is to rid society. the voters and any remnants that may appear in the Commission on Social Justice or anywhere else, of the idea that the problem is resolved by taxing and punishing the poor and by continuing to enrich the rich. That is what the Government's policy is about.

Unemployment in the pre-war years was ended by public expenditure. It took 3 million or 4 million people off the dole in the 1930s and put them in the arms factories. Those unemployed people made sten guns, and built Spitfires and ships. My dad never had a Spitfire in the garden and my mum never had a tank—it was public expenditure. To get out of unemployment, it must be recognised that public expenditure on public services is the engine of social renewal for the 1990s.

There is £16 million in the Chesterfield council area alone from the sale of houses that the council was forced to sell that it cannot spend on building new ones. On Friday, I heard four or five tragic cases of people who cannot get a house, yet the council has the money. I met an unemployed, homeless building worker outside the unemployment office the other day. Give him the money to build his house and he would not be homeless or unemployed.

Why do such things happen? Is it because the poor cannot afford houses? They are not customers for houses. Ask beggars on the streets of London at Embankment if they would like a house. They would love a house, but they do not have the money for a down payment. They are the under-class, the poor, the people who must be kept down as a warning to others not to get engaged in conflict with their employer.

Full employment is built up through schools, health and pensions. Economies would be enormous if that happened, because huge amounts of money would not be spent on unemployment benefit and income support. Those policies captured the imagination of an awful lot of people.

Over 50 years ago, when I was in the Air Force, the Beveridge report was published. "Full employment in a free society" and "social security" opened a new world and took people away from dependence on their employer. So in 1945, there was a huge swing in the general election and the Tory party was totally thrown out of office. Why? Because people coming back from the war vowed that they would never return to the means test, to unemployment, to rearmament and fascism. They said that they wanted to build a new Britain.

From travelling around the country, I suspect that that feeling is returning. I do not think that it has penetrated the House much, and it has certainly not penetrated the Conservative party. We will never resolve the problems that we are discussing today by targeting the deserving poor, for God's sake. What does "targeting" mean? It means that somebody who needs something has to go on probation to prove that he needs it, instead of receiving it as a right. The Beveridge report was about people receiving benefits as a right.

We must recognise that we are in a community and not a jungle. If the British public made up their mind that they wanted to be a community and not a jungle and made that clear, any Government would have to respond. One cannot be born without two parents, and one cannot be buried without the help of someone else. The idea of individualism—clambering to the top on the back of somebody else—is a wicked, evil doctrine that we must exorcise from our society; otherwise, its fabric will break down and we shall be left with people who are strong without being rich because they have a pick-axe handle and take action that, historically, people have taken when they have been denied justice. History shows that that is how many injustices were dealt with, but that is not the right way to deal with them. The right way is to represent arguments with force and passion here and in the country and to get policies changed.

I am glad that this debate has taken place, because it has touched on philosophy instead of being an opportunity to bash a failed Minister—and there are plenty of them. When all of them have been destroyed, the media put them on every television programme to apologise for having destroyed them in the first place.

6.50 pm
Mrs. Angela Browning (Tiverton)

I am grateful for the opportunity to follow the right hon. Member for Chesterfield (Mr. Bem), who apparently spoke on behalf of the Co-operative Society from the cradle to the grave. Perhaps I could make his day by beginning my speech by quoting Churchill's appraisal of the welfare state, which he described as a safety net through which no one should fall, from which all can rise and on which none can lie.

I should like to deal with that statement, because the problem that we face today in needing to review social security payments and the welfare state bears inspection based on Churchill's original assessment. Despite the £80 billion of public money that is spent, some people fall through the safety net—not, as Opposition Members have suggested, as a result of a deliberate Government ploy.

I recently attended a meeting in the House with the Carers National Association, whose survey of people with disabilities and special needs identified a large number of people who are living at home but are unknown to social services. Many of them live with their parents. It is only when their parents become ill or die that they come under the auspices of the social services, who then have to assist them with living and provide for them. Those people could genuinely be described as people who have fallen through the net. We must be more vigilant in ensuring that we identify the needs of such people.

Much attention has been paid in the debate to the single parent. I know from speaking to constituents that many women are single parents, often as a result of marital breakdown, and would like to rise from the net by returning to work and becoming financially independent. Despite the safety net of benefits and other moneys such as maintenance, it is often extremely important to such women that they regain their sense of independence and control over their lives and that they feel that they can make a contribution to their family's well-being. In reviewing the social security system, perhaps we could consider how we can assist that group to rise from the net and allow more women, particularly single women, who want to work to support their families to do so.

Another problem is people who lie on the net and take advantage of the system. I am sure that hon. Members will have heard from constituents who can clearly identify people in their local communities who lie on the net—those who take the money but moonlight and have undeclared earnings, which give them a considerable income when added to state benefits. Such people work the system.

It is appalling not only that they do so but that the nation is deprived of that money which could be better targeted on those who are in genuine need. People who see that going on have often made provision for old age, have lived frugally, have worked hard and have a passionate sense of injustice at people being allowed to abuse the system. I know that my right hon. Friend the Secretary of State will carefully consider fraud by people who claim and receive a range of benefits, which so affronts those who have worked hard.

One or two remarks made in the debate suggest that Opposition Members do not believe that there is a problem with public money being prioritised to the single teenage mother. Hon. Members should not he judgmental. When a teenage girl has had a baby, there is a statutory obligation, not only on us as legislators but on the local authority and the local benefits agency, to ensure that mother and child are cared for and that they have a warm, safe and clean environment in which to live.

I used to think that my constituents' grievance resulted from a generation problem, because many of the people who complain about provision for single mothers are of my own generation or a bit older. A case came to my attention a little while ago that I hope my right hon. Friend the Minister will take on board because it had a quite profound effect on me.

I was asked to see two constituents—a woman aged 21 and her husband, who was 20. They have a baby who is just over a year old. They live in a private rented one-bedroom house, which has one living room downstairs. They explained that the child was getting older and that all three of them slept in the bedroom upstairs. There was no room in the room downstairs for a cot or bed. They were on the council waiting list and were subject to the points system for council accommodation.

The husband worked, and they received family credit, so they were already in touch with the benefit system. The wife went to her housing office to inquire how they were progressing on the list for council housing—they had married when she was four months pregnant—and was told that if they had not married the council would have been able to find her much better accommodation.

She said to me, "I thought conservatism meant that if you worked hard and did things the right and proper way eventually you went up the ladder and got things that justifiably were yours; I see around me young single unmarried girls who have gone above me in the housing list—not only do they have an independent life in a flat, hut they have had help with buying essentials for the baby whereas we have bought second hand and have been grateful to receive things from the family."

I feel that there is a generation problem here, because my generation did not worry too much about having hand-me-downs from relatives. We were usually grateful for a second-hand cot or pram. The culture now, which is more apparent among people who are dependent on the benefit system, is that everything must be just right and brand new.

I must tell my right hon. Friend the Secretary of State that I did not know what to say to that young woman and her husband, because she was right. There is something fundamentally wrong with a system that allows such a young couple to be overtaken on the housing register when they are trying to bring up their baby in a loving home environment. Such cases must be considered in the review.

I said that we should not be judgmental, but must accommodation be suitable to an independent life style? Could we not consider providing warm, clean hostel accommodation? I am not talking about a ghetto, but about something adequate that meets the need of mother and child and our statutory obligations. Working people should not be overtaken in the queue by people who obviously have a clear understanding of their rights and entitlements under the current legislation.

My right hon. Friend the Secretary of State, who has left the Chamber, mentioned the case of a teenage girl who, although she was not pregnant, received generous benefits. I have heard of similar cases. The general public have become sick and tired of seeing people who use and abuse the system getting away with it while others who are doing the right thing and have worked hard. The public feel a sense of injustice about such cases. The House debated fraud last week and I hope that in the review my right hon. Friend will look carefully at how benefits are prioritised.

My right hon. Friend said in the introduction to the document "The Growth of Social Security": The aim is to improve the system; to make it better focused to protect the vulnerable, to ensure that we all have the means to cope with the needs and contingencies of modern life. Life in the 1990s is perhaps rather different from what it was in the 1940s and 1950s. Perhaps it is a good thing in many ways that we have moved on. Nonetheless, we must study those situations and take into account the public perception of how we manage and prioritise the £80 billion of expenditure.

An area which hon. Members and my right hon. Friend the Secretary of State have identified was that of pensions. The hon. Member for Glasgow, Garscadden (Mr. Dewar) mentioned the time at which the burden of state pension payments would become onerous because of the sheer number of pensioners in relation to the number of people working and contributing to the national insurance and taxation system. He said that that date would be about the year 2030. We should not be too dismissive of that, and I endorse and support the fact that the Government are looking in the 1990s at the long-term implications of pensions on the country and the individual. Let us face it —people now in their early 20s and paying into the system through national insurance and taxation will be looking to draw a state pension in 2030. It is not so far in the future as it may sound. In reality, it affects people who are currently working and paying national insurance contributions.

The Government have been right to encourage private pensions. The tax treatment of pensions in terms of the contributions from employees and employers has been generous and helpful. I hope that that will continue. It is important that as many people as possible are encouraged to maximise their income in retirement, particularly as this is an escalating problem which will he more challenging as time goes by.

Mr. Matthew Taylor

The hon. Lady perhaps will mention a subject for which I did not have time in my speech. There is a problem for some pensioners that arises from the increasing differences in charging levels by public utilities. I know that the hon. Lady is concerned about South West Water. Ofwat has estimated that, in the year 2000, pensioners on the basic level of income support in the area served by South West Water will face bills equivalent to 14 per cent. of their pensions. Pensioners in other areas will face a level of only 5 per cent. The Government must examine the matter if bills are to rise in that way.

Mrs. Browning

The hon. Gentleman has identified a matter about which people in the west country arc concerned. We have drawn the attention of my right hon. Friends the Prime Minister and the Secretary of State for the Environment to the problem, and they are working on it as we speak. The hon. Gentleman is right to identify the difficulties faced by people who do not have help additional to their basic pension or available to them through the benefit system.

That is why the matter is increasingly important. It concerns not only things such as water, hut the lifestyle of people who are dependent only on the state pension. There will always be people who, for one reason or another, have been unable to make an input during their working lives. The Government's encouragement through the tax system for people to make provisions if they are able to do so is helpful.

The hon. Member for Truro (Mr. Taylor) has intervened on my speech, so perhaps this would be a good opportunity to refer to one or two things that he mentioned. He declared that the Liberal Democrats will produce their own budget in the autumn showing how they would pay for such provisions through the tax system. I am aware that it is a policy of the party to identify individual policy areas of expenditure and to attach to each a certain tax.

We know that during the general election campaign —I believe that it is still a policy statement of the party —the Liberal Democrats declared that a penny on the basic rate of income tax would be specifically targeted to improve the requirements for spending in education. It rather sounds as though the hon. Gentleman is pursuing that claim. I shall watch with great interest to see how the other demands on all areas of policy expenditure would be met. I wonder whether a penny for education would be followed by a penny for social security. I am sure that the hon. Gentleman knows that the latter measure would raise only £1.5 billion of revenue, which does not sound like enough for that policy area.

Perhaps there would be a penny here and another penny there, which would mount up to a high level of taxation. I will follow with great interest how all the pennies amalgamate and what that would do to the basic rate of tax. An increase in tax would affect my constituents, particularly those who are on low incomes but are taxpayers.

Perhaps even more important would be the effect on pensioners who are just within the tax threshold, because they would be affected if taxpayers were required to make a contribution through the system of funding advocated by the Liberal Democrats. I will wait in suspense until the autumn to receive the figures, as the hon. Member for Truro was unable to give them this evening.

Mr. Matthew Taylor

I am happy to take the lion. Lady's knock-back, and she is right about our education policy. To he fair, however, I must say that we have consistently published our proposals at the time of each Budget. Like the Chancellor. we cannot publish in between because we do not have the figures.

Mrs. Browning

I take the hon. Gentleman's point, and I do not want to be too brutal to him this evening.

Before I turn away from the Liberal Democrats, I wish to mention an intervention by my hon. Friend the Member for High Peak (Mr. Hendry) during the speech of the lion. Member for Truro about how Liberal Democrat policy is decided. Naturally, that is a matter of great interest to many in this House. It may be a matter of great interest to the hon. Gentleman. It may be something of a mystery to him also.

The hon. Gentleman seemed to say that the matter of VAT charges on fuel had been put forward by the Liberal Democrats in a policy document, but had been put to vote and overturned at a party conference and was therefore no longer official Liberal Democrat policy. I wanted to raise that, because I am aware that the policy for a 50 per cent. cut in expenditure on defence was carried by a Liberal Democrat party conference, yet I know that the hon. and learned Member for File, North-East (Mr. Menzies Campbell) has consistently tried to persuade the House that decisions taken at Liberal Democrat party conferences are not quite so binding as we had been led to believe. Therefore, he suggests, we should not hold them to that 50 per cent. cut in expenditure on defence as a binding policy.

I not want to get involved in an internal struggle about how Liberal Democrat policy is decided, but the hon. and learned Member for Fife, North-East often challenges the Government on their policy, and we often ask what his party would do. It is a matter of some interest and there seems to be confusion as to where the decision making lies in terms of the type of debate that we are conducting tonight.

Mr. Matthew Taylor

The point about the 50 per cent. is that we came up with a range of possibilities immediately after the cold war ended, and 50 per cent. was the maximum suggested cut. With hindsight, as our defence spokesman said, we think that that was wrong. Indeed, it was corrected in later policy documents and in our manifesto. The Government are in no position to preach about consistency in view of some of their policies, such as the poll tax.

Mrs. Browning

We all travel the road to Damascus occasionally—and the Liberal Democrats rather more frequently than most. I hope that the hon. Gentleman will convey the message that he has just given us to the delegates at the next Liberal Democrat conference in the autumn. I am sure that they will be interested to hear how much power they have when they vote at the conference.

I have been grateful for this opportunity to tell my right hon. Friend the Secretary of State about some of my concerns about the review of social security policy and, in particular, about the way we treat single parents in the benefits system. Single parents are not to be penalised by what I suggest; it could often be an opportunity for them, getting them out of the safety net and back into work Many of my constituents, especially women, would welcome such an opportunity.

7.10 pm
Mr. Malcolm Chisholm (Edinburgh, Leith)

There have been many splits in the Conservative party during this Session of Parliament. I hope to see another one before the week is out. There will, however, not be a split in the Lobbies tonight. The modern Conservative party is united in its belief that public expenditure is too high—partly because Conservatives just believe that and partly because. as the Government of the day and of the past 14 years, they cannot face up to the real reasons for the public sector borrowing requirement. Those reasons are unemployment and the shrinkage in the tax base, both created by the Government.

Earlier, my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) reminded us that the bottom 10 per cent. of the population are 14 per cent. worse off in real terms than they were in 1979, largely because of unemployment. We were also told that the income support bill stands at more than £10 billion, whereas in 1979 it was £4 billion, at constant prices. The main reason for that is also unemployment.

As my right hon. Friend the Member for Chesterfield (Mr. Benn) said, unemployment also has other effects, such as causing more and more people to he low-paid. That is another reason for the shrinkage in the tax base and for increased social security spending on family credit and other benefits.

At the other end of the tax system, there are other reasons for the shrinkage. We know from recent figures that the top 1 per cent. have gained £33,000 from tax cuts in each year of this Conservative Government's tenure. We also know—the former Chancellor reminded Conservatives of this the day before he was sacked—that corporation tax evasion is a massive problem. A survey in the 1980s showed that only two of the top 20 companies paid mainstream corporation tax. The Conservative party should be thinking about the shrinkage in the tax base and about doing something about unemployment; it should not be trying to implement cuts in public expenditure.

This evening we have heard the predictable litany from the Secretary of State, who pointed to three chief categories of people to serve as scapegoats for the mess that the Government have created. He mentioned invalidity benefit recipients, housing benefit recipients and lone parents. I want to speak mainly about the last of those three, but, first, I wish briefly to mention invalidity benefit and to invite the Minister to answer the question that I put to the Prime Minister four or five weeks ago. I have been lucky enough to ask him three questions recently, none of which he has answered. Perhaps this evening the Minister will answer my question about invalidity benefit.

Apart from the sort of people mentioned in the leaked document—the builder with heart disease, for instance —who else is to be excluded from invalidity benefit? Why on earth should people like this be the ones to pay for the Government's economic incompetence?

As for housing benefit, we have already been told by my hon. Friend the Member for Greenwich (Mr. Raynsford) that the real reason for the increase in the benefit has to do with the reduction in Government support for council housing and with deregulation of the private rented market. I will say no more about housing benefit except in so far as it relates to my main subject this evening—lone parents.

The first myth perpetrated about lone parents in the course of the terrible attacks on them by Ministers in the past three weeks has had to do with housing. I draw the attention of hon. Members to the interview with the Secretary of State for Wales, in which James Naughtie of the BBC asked him where he got the idea that teenagers were having themselves impregnated to get council houses. The right hon. Gentleman said that he had read several newspaper stories about the subject. So that is that; the matter is settled.

By whipping up these myths, the Government are creating a climate in which people are seriously beginning to talk about moving young women into hostels or forcing them to stay in the parental home. Both ideas should be ruled out immediately — I hope that the Minister will rule them out tonight.

Myths about crime are also to he heard. A week ago, in a terrible article in The Sunday Times about three young criminals, the author commented, "Needless to say, they were from single-parent households.- Yet research by the Home Office in the mid-1980s showed that there was no difference in delinquency rates between children of two and one-parent families. In Edinburgh, the criminologist Richard Kinsey has done research on Scotland that comes to exactly the same conclusion.

The third myth is that lone parents are somehow to blame for the public expenditure and deficit problems of the Government. As I have shown, that is not true.

What is really behind all these myths is the age-old Tory trick of dividing people who should be united against them. As lone parents become the scapegoats, the Government are trying to turn two-parent families against single-parent families so as to distract people from the real reasons for their problems.

There are only two families in the world—the haves and the have-nots. As everyone knows, lone parents predominantly belong to the latter group; indeed, 70 per cent. of lone mothers are on income support, as are a slightly lower percentage of the much smaller number of lone fathers. Most lone-parent families are living below the poverty threshold and are caught in the poverty trap.

It is utterly obscene that people should seriously suggest reducing the already inadequate income of these people. Are Conservatives saying that lone parents are squandering the £70 that they get on luxuries like food, clothing and fuel taxes? They do not have enough money as it is. They are frequently reduced to approaching the social fund if they need anything beyond the bare necessities of life. It is intolerable to suggest cutting their incomes.

Dr. Green of the Institute of Economic Affairs—he seems to have the ear of the Government—suggests that mothers under 24 should receive only basic income support and no more. I hope that my hon. Friend the Member for Halifax (Mrs. Mahon) will shortly explain to the House that people aged less than 24 are living on less than £5 a day. Is it seriously suggested that lone parents, too, should exist on that? No; we should be talking about increasing their incomes, and I hope to show how that can be done.

This whole debate has had an air of unreality about it. When the Secretary of State for Wales started it rolling in a housing estate in Wales, it was a local policeman who had to inject a note of reality into the situation. He said that, because of domestic violence, injunctions had been taken out against many fathers on the estate, who were not allowed near the women. That was not taken into account by the Secretary of State for Wales.

In Edinburgh, there has been a pioneering campaign against domestic violence. I hope to speak about that in the debate tomorrow. It must be realised that many lone parents are the victims of domestic violence. The Secretary of State for Wales cannot seriously be suggesting—although he seemed to be—that he would like such men to return to those families. We cannot say, in blanket fashion. that two-parent families are always better than lone-parent families. In many situations. it could be the reverse. There cannot be a generalisation of that kind.

The Child Support Act 1991 is another cause of concern for lone-parent families who are subject to domestic violence. As the Act begins to operate, we are hearing that men are told that they are being asked for money because their former partners have specifically asked for it. We all know that women have no choice in the matter. I hope to raise several related issues in more detail tomorrow.

Contrary to what the Secretary of State has said, the majority of parents on income support are not helped in any way by the Child Support Act. Any money they receive from former partners or husbands is deducted from their income support.

There is an absence of reality in the statistics. Who are these lone parents that the Government have lumped together and created myths and prejudices about'? Some 70 per cent. are separated or divorced. Only 45,000 of the 845,000 people on income support are teenagers, and of that fairly small number only one in 10 actually planned the pregnancy.

The Government say they are very concerned about teenage pregnancies, but what have they done about it? What has happened to family planning clinics over the past few years? I have the figures for England and Wales, which were given to my hon. Friend the Member for Bristol, South (Ms Primarolo) on 7 June. They show a drastic decrease in the number of people referred to family planning clinics, which were not in any way balanced by an increase in people going to their GPs.

One in four family planning clinics has been shut over the past few years. Why do not the Government address that problem? Why do they take such a soft and pathetic line on sex education, as in their Bill yesterday, which denies teenagers the right to sex education if their parents do not wish it? Why are they talking about making contraception even more difficult by extending the selected list? If the Government are concerned about teenage pregnancies, these problems must be addressed.

Something must be done to help lone parents in respect of child care. This is at the very heart of the debate. Surveys show that as many as 90 per cent. of lone parents would like to work if they had child care. In my constituency, I have been involved with a child-care action group, which has carried out similar research and come up with similar figures. It is a key issue which the Government should address if they are concerned about getting lone parents off benefit.

Considerable research has shown that if child care were provided and we had an economic policy that created more jobs, the returns to the Exchequer would be greater than the amount currently spent on social security. Only two weeks ago, the Daycare Trust issued a report that proposed specific ways in which lone parents could be helped. I asked about that at Prime Minister's Question Time, but did not receive an answer. I have written to the Prime Minister and may get an answer in due course, but perhaps the Minister can comment on my proposals tonight.

At present, it is very difficult for lone parents because, even if child care were available, there is no way that people in low-paid jobs could afford to pay for it. I suggest that the money that anyone on income support or family credit spends on child care should be discounted or disregarded when assessing their income. That would be one small way in which to get lone parents off benefit and into employment.

Far more than that has to be done about child care; the whole question of supply has to be addressed. The Labour party is beginning to make the issue of child care one of the key arguments, not only in terms of helping women but in terms of economic policy. Much research has shown that that will benefit the country economically, as well as benefiting a large number of women.

Why do not the Government do something to help lone parents, rather than criticising them and making them scapegoats? Lone parents in my constituency are sick and tired of hearing what we have heard from Ministers over the past few weeks. Labour Members are sick and tired of that as well; we are particularly disgusted that it should come from Conservative Members who know very little, if anything, about the kind of conditions in which lone parents have to live. It is appalling that we should hear such things from Ministers and Conservative Members, whose idea of deprivation is limited to missing the occasional lunch.

7.26 pm
Mr. Quentin Davies (Stamford and Spalding)

I listened to the speech of the hon. Member for Edinburgh, Leith (Mr. Chisholm) with great interest. It was an exposition of the classic Labour view of benefits, which is that benefits are good and more would be even better. If there are problems, it is because there are not enough benefits. I hope to persuade the House that that is an inadequate response to the issues with which we are faced, but the hon. Gentleman set out Labour's traditional case with forcefulness and lucidity.

I will make four points; then, unlike the hon. Member for Glasgow, Garscadden (Mr. Dewar), I will address the issues that I have raised and make practical suggestions. In that way, we may make progress. The hon. Member for Garscadden was long on complaints but very short indeed on any practical or constructive suggestions. That once more demonstrated the fundamental intellectual bankruptcy of the Labour party that we have seen in so many contexts recently. The Labour party has acknowledged that by contracting out further thought on this subject to some "independent" body that it has set up.

A point that has not been made this afternoon, but that all hon. Members surely acknowledge, is that the welfare state is a very remarkable and positive achievement. It is a great advance of civilisation that we no longer accept a position in which our fellow citizens can be left to starve in the street. It is a positive achievement of civilisation in this country, in this century, that we have removed the appalling horror of old age and widowhood that beset so many families 100 years ago.

All parties in the House can take their share of the credit for the construction of the welfare state. It owes its origins to the beginning of the century, and then to the great Beveridge report, which—rightly—has been referred to with reverence and respect many times this afternoon. That report was commissioned and accepted by the wartime coalition Government, led by Winston Churchill.

The welfare state that was subsequently constructed was laid on the foundation of the staple contributory benefits: old-age pension, sickness benefit and unemployment benefit. Those benefits have proved their worth. They are now part of the political consensus, and I am delighted that my right hon. Friends on the Front Bench have made it absolutely clear that the Government will continue to be committed to them. Scare stories to the contrary can be dismissed with contempt.

My second point may be controversial. The hon. Member for Leith would not agree that there is a major problem, but the whole system has now become excessively expensive. My right hon. Friend the Secretary of State set out the figures, which are, or should he, well known, this afternoon—social security expenditure is more than £80 billion, or one third of total Government expenditure, and one eighth, or slightly more, of gross domestic product.

It is a mathematical certainty that one cannot go on indefinitely increasing the share of GDP spent on social security. For it is a logical impossibility in any society that everybody should be subsidised. And there must be a point at which the burden becomes intolerable. If we have not yet reached that point, we must be extraordinarily close to it. Now is therefore the right time to take a hard and thorough look at the system, and I do not think that we can responsibly avoid that challenge.

My third point is that there is frequently a superficial attitude towards the whole benefits system, which was well set out and represented by the hon. Member for Garscadden this afternoon. He said that the social security system must deal with social realities. As a preliminary remark, that is an unexceptionable platitude. However, anybody who believes that that is the end, or even the essence, of the problem is taking a superficial view.

The social security system has now reached such a scale, in terms of the proportion of national resources that it consumes and redirects, and of the number of people who are dependent on it, that it largely influences and moulds that social reality. We must deal with that problem. Behaviour patterns can be, have been, and are being substantially changed and distorted by the existence of the social security system.

My fourth point is that the system, without the slightest doubt, is riddled with all kinds of anomalies, contradictions and perversities. One of those was mentioned earlier by the hon. Member for Garscadden, for which I give him credit. In many circumstances, if a man loses his job and his wife has a part-time job, it may be the financially rational solution, to maximise benefit and family income, for his wife to leave her part-time job so that the household qualifies for the full range of benefits—mortgage interest, housing benefit and so on. That is surely crazy.

Another obvious anomaly that springs to mind is that, if someone is made unemployed and decides to spend his or her enforced leisure time learning a new skill to provide for future employment, he or she will be deprived of benefit if that training course is considered to be a full-time course. It belies all common sense that society should be more ready to subsidise someone who. having lost his or her job, simply sits at home and does nothing, rather than someone who makes an effort to go out and use that time usefully by developing a new skill.

I have encountered another anomaly frequently in my constituency. If somebody is made unemployed, he or she will qualify for payment of mortgage interest. If he or she decides to go back into work, but at a lower salary—it may be an extremely useful job; a lower wage or salary does not make it necessarily less useful—he or she will lose all support for mortgage interest. It requires a considerable sacrifice in those circumstances, and a considerable commitment to the principle of hard work, to override the financial rationality and for that person to go back to work. What in the world are we doing putting in place a system that has such a thoroughly perverse effect?

And what in the name of heaven are we doing paying housing support to keep teenagers—who may have had an adolescent tiff with their parents and walked out of home, perhaps precipitately—in some hostel, perhaps in an inner-city area where they are exposed to all kinds of dangers, moral and otherwise, at the expense of the taxpayer, when they have good homes and loving parents who desperately want them back? I have encountered that in my constituency. That is not merely the economic policy but the social and moral policy of the madhouse. There are a great many such things that need to be looked at and radically changed.

I said that I would not confine myself simply to analysing or criticising the system or bringing forward complaints about it, but, rather, that I would make one or two practical suggestions. My first conclusion is that our system of contributory benefits has proved its worth. It should not be fundamentally altered except in one respect, which I shall propose in a moment. Indeed, it should be strengthened wherever possible. I regret the tendency that has sometimes emerged from the Department of Social Security to tinker with the contributory basis of those staple benefits.

The one sector at which we should take a fresh look is where there may be some scope for encouraging people to opt out of the system voluntarily and use alternative private insurance. I do not think that one can easily insure oneself privately against the economic hazards of unemployment, but one can insure against hazards such as disability and sickness.

There is no reason why we should not look carefully at the possibility of providing inducements, either in terms of a front-end payment, as we did when we were encouraging people to opt out of the state earnings-related pension scheme, or a continuing tax break, or combination of the two, in such a way that the net cost on public funds could be reduced while people could provide themselves with an equivalent, or even better, level of private insurance cover for those hazards of life. I hope that my right hon. Friend the Minister, who is flatteringly taking notes during my speech, will look at the possibility of doing that.

I also take the view that we should look carefully at workfare. The Prime Minister bravely said a few months ago—with the predictable outcry from the "bien pennant" section of the media—that this was not a matter which we could exclude from a review of social security policy.

Workfare in different forms is practised in civilised countries from Sweden to the United States. It seems to me entirely reasonable that somebody who finds that he or she has fallen on difficult times and requires support from the community should spend his or her involuntary leisure time doing something useful for the community in return for obtaining a new skill by going through a proper training programme.

I accept that there would be an enhanced cost to the present system if workfare were implemented, and it may be sensible to limit it to certain age categories—perhaps 18 to 24-year-olds or the under 30-year-olds—or to introduce it, at least initially, voluntarily or regionally. I hope that my right hon. Friend the Minister of State is considering that carefully and that we shall hear before too long of some concrete proposals.

The introduction of workfare would deal with some of the anomalies in the system that I have mentioned. In contradiction to the attitude that I think right and proper towards the traditional contributory benefits, I believe that we should be sceptical about means testing. which is at the root of some of those anomalies and many others, of which hon. and right hon. Members on both sides of the House are all too well aware.

We risk the social security system having a perverse impact on people's values and behaviour patterns and ultimately on the future shape of our civilisation, and that is not a literary hyperbole. If one targets benefits in such a way as to erode steadily the difference between what the average man or woman receives by staying at home unemployed and what he or she obtains by going back to work, there will be a greater disinclination to go back to work for every pound by which the gap is reduced.

Increasingly, people will feel that one is a fool to go back to work. Who wishes to admit that a whole week's leisure is worth only a tiny amount—perhaps £10, £15 or £20? Everyone sets some positive value on his or her leisure, and it is dangerous to send a signal to society that people make fools of themselves when they go back to work because they receive only a small, almost derisory, marginal increase in their income.

Equally, if old people's benefits are means-tested, that will erode the difference between the disposable incomes of those who receive benefit and those who have made some small private provision or who benefit from private savings or a personal or private occupational pension. People will ask why they made a sacrifice to save a small amount out of a modest income for all those years, when they are only a few pounds better off than the people next door, who did not bother to do so, and when the return on that sacrifice is derisory and insulting.

If we go down that road, we send people a perverse signal about values, because we are telling them that there is no great credit to be had from saving or from work. We send a perverse economic signal to society because unemployment levels are likely to be higher when people are less prepared to supply their labour. We cannot afford to ignore that example of how a perverse social security system can exacerbate the very problems and social malaise that it is designed to counter.

In his Mais lecture, my right hon. Friend the Secretary of State has produced a first-rate agenda for a thorough review of the system. He has not attempted to pre-empt the debate by setting out any conclusions—that is right—but he has asked all the right questions. He has provided some of the essential facts, and if we do not take the opportunity that he has created, by having a serious, rigorous and constructive debate on the subject—as serious, rigorous, and essential as the debate that followed the publication of the Beveridge report, 50 years ago—it will not be the Government's fault. We Back Benchers will have been remiss in our duty if we do not take the opportunity to reconsider the system humanely, positively and responsibly.

7.44 pm
Mr. Thomas Graham (Renfrew, West and Inverclyde)

After hearing the hon. Member for Stamford and Spalding (Mr. Davies) speak, I realise that there is absolutely no hope for the Tory party. I have never heard such drivel in my life. Does the hon. Member live in the real world?

Come with me to my constituency; come with me to my home; come and meet my neighbours. Those folk want to work. They want the right to work and they are not getting it under the Government. I know thousands of people who arc looking for work. They want the right to a decent wage and to look after their home without begging for charity. They want jobs. Come to Linwood and meet the many decent, God-fearing folk who want the right to work but have not had that right since the factory closed 10 years ago. Think of that—10 years of Thatcherism, 10 years of Toryism.

The Conservatives have been in power for 14 years. They have been 14 long, hard years for people in Britain —for the unemployed, the pensioners and the disabled, who have seen the fabric of life dismantled before their very eyes and have seen the Government squandering incredible opportunities, as my right hon. Friend the Member for Chesterfield (Mr. Benn) said.

Let me take the House through some examples. Will hon. Members tell me if this is the type of Britain that we are about? I intervened during the Minister's speech and asked him about a woman who came to see me, who could hardly walk or crawl. She heart problems and arthritis. She was nearly walking dead, yet her mobility allowance had been stopped. That woman nearly had a heart attack because the resources that were needed to keep her alive were savagely taken away from her. With practically no rights, she did not know where to turn and went to her Member of Parliament. It is a sick society if people have to ask their Member of Parliament to look after their circumstances. They should be looked after in a humane society and a humane system. As I said, we ensured that people fought her case for her, and she eventually got her money.

A family woman, suffering from arthritis and heart problems, also came to see me. Her invalidity benefit had been stopped and she did not know what to do. It took her 12 weeks to get as far as me. The Minister will tell me that big signs are up on the walls and if she had read them she would know how to go about it. I know that a debate took place about having big signs. Anyway, it is absolute nonsense. That woman is suffering because the Government unilaterally cut off her invalidity benefit.

Another example was that of a man who was also denied mobility allowance. He can hardly walk. When he walks five yards he has to wait about 50 minutes to walk the next five yards. It looks as though the Government have a hidden agenda of cuts in social security and as though, to save £80 billion in expenditure, they will have to take money from the people who are least able to defend themselves.

Here is the sickest example. A man was taken off mobility allowance. He then had to go to a doctor, who asked him to walk 100 yd. The man walked 100 yd and the doctor said, "Now you're fit you don't get mobility allowance. You're denied it." The man died two days bloody later. That is the sort of stress and strain that we are putting on our sick and disabled folk, and they are honest and have integrity.

Can I go further? The Secretary of State should be called the "Minister of Misery". He has not given happiness or security to people on state benefits or on low pay, and he used insulting language of a kind that I have not heard here for a long time to my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar). I am sure that my hon. Friend is tough enough to fight his own battles, but I come from a different school: if anyone accused me of sanctimonious humbug I would dig them right up.

That is not the type of language that we are used to hearing from Ministers on whom millions of people rely to have a bit of heart instead of a hard head and a stupid tongue. The Minister should get his language right because personal attacks do not do any of us any good. They are for outside. [Interruption.] If any Conservative Member wants to intervene I shall be delighted to let him in. He might learn something.

Terms such as "sanctimonious humbug" in a debate in which we are trying to be constructive and give the Government some enlightenment and show them the path of sanity are wrong. Their ears are plugged, their eyes are blind and their tongues are used only as whiplashes on folk who desperately need a decent Government.

The hon. Member for Bolton, North-East (Mr. Thurnham) read out a wee bit from The Times. I did not read it. He said that the Minister should visit Wisconsin where grandparents help single parents. It is absolutely disgraceful to suggest that that does not happen here. I know lone parents who get support from their grandmothers and grandfathers. It happens all the time. Do the Tory Government think that grandparents do not assist their families? Do they sincerely believe that grandchildren are ignored?

There has been talk about the fabric of life. Five of my years were unemployed and I know what the Government's fabric of life consisted of. For five years I experienced the difficulties of Christmas time and kids' birthdays, and what it was like when they had a cold or the 'flu.

Mr. Nigel Evans (Ribble Valley)

The hon. Gentleman says that he knew about the difficulties of unemployment, especially at Christmas time. How did he feel when the last Labour Government twice stopped the pensioners' Christmas bonus of £10? Did he feel any shame when that Government did that to the pensioners who needed that money, particularly at Christmas time?

Mr. Graham

I will take time to give the hon. Gentleman a lecture within the debate. In those days the amount was related to earnings. However, at that time there were fewer than I million unemployed. People were happier and they had money to go on holiday. In my area, since 1979, since the great miracle movement called the Tory party took control of this country, 166,000 manufacturing jobs have been lost in Strathclyde. That is an assault on the fabric of life because it is taking away the right of men and women to earn a wage.

The Minister would not be able to talk about £80 billion of welfare expenditure if the Government had supported some of our manufacturers. They should have invested and reinvested and modernised those companies. If they had done that, those companies would still he there. We know what unemployment is like, and we know the sickness of having no wages, no pay. The Government should never mock the men and women of this country who have to face that suffering every week.

Not long ago a Conservative Member tried to live on dole money, but he gave up after five days when the money ran out. As I have told the House before, if he had tried to live on it for a year he would have been dead after seven months when the money ran out. Look at what the Government have done to the country: they have privatised everything and anything that can move to save their bankrupt policies. They have sold oil, gas, coal, electricity and telephones. You name it—they have sold the lot. As one of their noble Friends said, they have sold the nation's silver. Now they want to sell our soul, the caring part of Britain, because they do not want to look after our people.

A Conservative Member said that they would take a hard look. What do the Government mean by a hard look? Does the mean that Chancellor saying, "We will have to make hard decisions"? Do such hard decisions mean that the elderly, the lone parent, the unemployed guy and the disabled lad will have their benefits cut? Will they attack the people who need our help and who need good governance of our economy?

I am utterly disgusted at the total mismanagement of North sea oil. Some £100 billion was squandered while in Strathclyde hundreds of thousands of manufacturing jobs went to the wall. That £100 billion was used to prop up men on the dole. That was absolute nonsense. Any thinking Government would have used that money to buy new machinery and equipment and to finance computerisation—all the things that are needed in a high-tech country. But not this Government: they go the wrong way, bury their head in the sand and put our people into deeper deprivation.

One of the most ridiculous policies was the privatisation of water. At least in Scotland there is a guarantee that everybody is entitled to a basic supply of water without having it cut off, but not here in England and Wales. How many times have they cut off the water? Thousands of people have been cut off. When I was at school, a wee bit of time ago, we used to read the books and get a wee history lesson. I remember the days when if you heard "Gardez l'eau" you ducked because if you did not you got covered in muck.

Who would believe that any Government would go down the road of ensuring that, because of water privatisation, people could not afford the water that is needed to cook, clean and do the necessary? The Government went down that road and did not provide safeguards so that folk could be assured of a basic commodity. My hon. Friend the Member for Glasgow, Provan (Mr. Wray) has fought for many a month against the privatisation of Scottish water and could probably tell the House more about that than I could.

The Government are now in the business of being desperately wrong. A few days ago, there was an exchange between hon. Members about this bankrupt Government having no plans. It is incredible.

Mr. Jimmy Wray (Glasgow, Provan)

Does my hon. Friend realise that when he talks to this Government he is talking to a brick wall? They are responsible for the misery and poverty. They have had no strategy for investment but have followed a short-term policy of selling the nation out. creating misery among the unemployed and putting 16 and 17-year-olds on drugs. That is the sort of policy they have followed. Yet Conservative Members sit and laugh at my comrade who has the facts and figures. They do not know what poverty is, but those who invested in Lloyd's will shortly know what it means when they are out of here and on the dole and trying to live that kind of life.

Mr. Graham

What can I add to that? After 14 years under the party of law and order, we have seen crime in Britain escalate to an unbelievable level. People arc frightened to walk the streets, elderly people cannot go out even in the daylight and are terrified of going out at night. What have the Government done about that? Nothing. Unemployment is raging. We have seen countless bankruptcies and companies are shutting down all the time. The Government have absolutely lost their way. They are not just hard-headed; they are hard and callous, because they do not have a policy or a plan either for the economy or for the social fabric of life. They have led us from crisis to crisis and created crises.

The Labour party is correct to support the Commission on Social Justice. The House should listen to one of its key statements, so I will read it: No Government can solve the problems of the benefits system without solving the problems of unemployment. Instead of an increasingly tattered safety net, the welfare state must be a springboard for economic opportunities". So long as we have a Government committed to unemployment, we shall see young folk languish in the doldrums and go early to their graves. If there were a general election tomorrow, there would be no Tories on the Government side of the House. I believe that the people of Britain have had enough. The people of Newbury will show the rest of the country the road. I watch the laughing smiling faces of Conservative Members. I look forward to seeing them on the day of the Newbury result.

8.2 pm

Mr. David Willetts (Havant)

We, too, are looking forward to the Newbury result in the next general election when we can be confident that a Conservative Government will be returned for a fifth term.

The hon. Member for Renfrew, West and Inverclyde (Mr. Graham) spoke powerfully about the subject of unemployment, but failed to take any account of the very clear speech by my right hon. Friend the Secretary of State for Social Security.

The main point of my right hon. Friend's speech was that we should not have any illusions that the growth of social security expenditure was caused by cyclical unemployment and would disappear as unemployment fell, or was caused by an increase in the number of pensioners. The point of his argument—which is supported by the informative document produced by the Department of Social Security—is precisely that we have a problem of underlying growth in social security expenditure which is independent of changes in unemployment or the number of elderly people.

The problems driving the increase in social security expenditure are in three areas: first, the increase in housing benefit expenditure; secondly, the increase in expenditure on single parents because of the dramatic increase in the numbers of single parents; and, thirdly, the increase in the number of people claiming invalidity benefit. That is where the upward pressures are to be found.

It is easy to say that as unemployment falls the pressures on the social security budget will disappear, but the figures show that comforting illusion to be wrong.

Mr. Wray

The hon. Gentleman is talking about changing the fabric of society. Surely we cannot change the fabric of society by taking away benefit from 16 and 17-year-olds or by allowing standing charges on heating and fuel. It has nothing at all to do with our policy; it is the Government's policy. It is their mess which they have created. They have turned the Department of Social Security into a loans hoard. People are begging because they run out of money after three months. What can people do when they have done away with the single payment? There is no money to give them.

Mr. Willetts

We have heard another strong bid for membership of the Labour party's Commission on Social Justice. I look forward to the hon. Gentleman serving alongside miscellaneous left-wing professors in that commission's deliberations.

The radical change in the social fabric was the guaranteeing of a training place for people aged 16, 17 and 18.

Mr. Graham

I remember when the Prime Minister stated in the House that every young person was guaranteed a place. The hon. Gentleman knows that in my constituency that did not happen. Does he know that between 5,000 and 8,000 young people in Scotland are still waiting for that guarantee to be delivered?

Mr. Willetts

Of course there is a problem, which the Government are obliging training and enterprise councils to address, of ensuring that that guarantee is met. Meanwhile, any person waiting for a place on a training scheme is entitled to a payment in lieu of his or her attendance on a youth training scheme programme. That policy is agreed between the Department of Employment and the Department of Social Security.

Before the hon. Gentleman diverts me too much from my speech, I should like to address the big question on which the Opposition touched—what is the social fabric? The social fabric extends way beyond the social security system. We must not think of the social fabric in terms of social security expenditure; nor is it something provided only by Government. The Labour party sometimes talks about the social fabric as if one could get it by the metre from department stores, with the Government buying it. It is not like that. The social fabric is what political theorists call the framework of the civil society. It is the principles and values of voluntary associations, people helping themselves, the neighbourhood, and people helping their fellow employees in the firm. That is what social fabric is all about.

A welfare state is part of that social fabric and can sustain people through times of difficulty. That is why the extraordinary overblown claims in Labour's motion about the dismantling of the welfare state are false. We have a clear commitment to a role for the welfare state, but we have to ask whether the welfare state sometimes acts as an agent for weakening the social fabric. It creates an attitude of not wanting to get involved in local organisations because that is a job for the welfare state. People imagine that they can discharge their obligations to their fellow citizens by paying their taxes and the social security system shelling out the money. That does not enrich the social fabric; it can be a threat to it.

The Government's policies to strengthen this social fabric range way beyond social security. As I have spoken before of changes in the social security system, I want to take this opportunity to address some of the other aspects of the social fabric.

First, there is the need to give genuine power and responsibility to local institutions. The process whereby in the post-war period all the local institutions that really mattered—such as the school and the hospital—were gradually brought under centralised bureaucratic control did not strengthen them; it weakened them.

If one takes the train from Waterloo or Victoria through south London and looks at the 19th-century terraced houses with Victorian schools towering above them, one can see that the Victorians who often built those schools with voluntary money, knew the importance of the school in the local community. They knew it had to be locally run and under the control of local governors.

The purpose of the Government's reforms in health, education and elsewhere is to give back to those institutions the powers that they have slowly lost. That policy became known in its early stages as opting out, but that is rather a misnomer. It gives the wrong impression of what the policy is about. I remember a marvellous cartoon showing a schoolmaster leading a troop of schoolchildren up the steps of a spacecraft saying, "When Grimethorpe grammar school opts out, it does it properly." That is not what opting out is supposed to be about. It is not about leaving society but about returning hospitals and schools to the local community and away from the control of distant bureaucracies.

Today, there has been an important meeting at Downing street on the burden of regulation. One of my concerns is that so much of the debate during the past few years has been preoccupied with the amount that we spend on the welfare state that insufficient attention has been paid to the way in which changes in the regulatory burden on voluntary organisations and other providers of welfare services have made their job more difficult. There is a direct connection between the Government's obvious concern with maintaining the social fabric and the burden of regulation. Perhaps I might give some examples.

We have recently passed important new legislation regulating the work of charities, but some local charities find their new legislative burdens are too onerous. I see my hon. Friend the Minister for Social Security and Disabled People in his seat. Last week, at a conference of people involved in charitable work, I was told that, if a charity proves to have been mismanaged in any way, its trustees now face considerable financial responsibilities. Several charities have been trying to involve groups such as benefit recipients in their managing bodies, making them trustees. The financial risks to which those people are exposed as a result of becoming trustees under the new charity law has been a source of concern to them. We do not want becoming a trustee of a charity to be like becoming a name at Lloyd's—a venture embarked on at considerable financial risk.

There is a marvellous network of provision in Britain for the under-fives. However, we need more provision for them—more voluntary playgroups. Often, the provision for the under-fives is the result of mothers getting together and hiring a church hall or a spare school classroom. But, as my hon. Friend the Minister will know, the Children Act 1989, often over-zealously interpreted by individual local authorities, has put an extra burden on the providers of services for the under-fives which they sometimes find themselves ill placed to bear. As a result, some providers of child care have, for example, stopped giving lunches or allowing children to play in the playgrounds.

Another example that arose during a conversation in my constituency at the weekend concerned someone who was providing meals for elderly people through a local charitable group. In order to meet the new food regulations, the variety of food offered to the elderly people had been limited. There is a regulatory problem here.

Instead of looking back, let me now look forward. The Government will soon be receiving the report of the Goode committee concerning the regulation of occupational pension funds. Of course the lessons of the Maxwell affair must be learned. Of course, where there have been failures of regulation and supervision, they need to be addressed and the supervisory regime needs to be improved; but I hope that the Goode committee will not simply impose a new over-elaborate framework of form-filling on many well-managed occupational pension schemes which do not need that extra bureaucratic burden.

Bearing in mind the review of social security now going on in the Department of Social Security, I hope that the Goode committee will ease the regulatory burden on private pensions. For example, it is too difficult to go through the incredibly elaborate procedures necessary in order to contract out from the state earnings-related pension scheme. Can those procedures be simplified? Do we really want a position where, I am reliably informed, it is impossible to market a group personal pension scheme giving people the benefit of personal pensions, but with the added bonus of the employer himself or herself contributing to the cost of that group personal pension scheme because companies then find themselves hit by the Financial Services Act 1986? There is a regulatory aspect to the encouragement of future pension provision which will, I hope, be addressed in the review. Therefore, as we think about the social fabric, we have to think about regulation, not just expenditure.

The reports prepared by the Labour party's Commission on Social Justice make a variety of claims about poverty and inequality to which I want briefly to refer because they contain extraordinary misconceptions which need to be clarified. The average British citizen on average income has experienced an extraordinarily dramatic increase in his or her real living standards since 1979. Not even the inventiveness of Opposition Members will make it possible for them to deny that fundamental assertion.

Mr. Wray

Will the hon. Gentleman give way?

Mr. Willetts

We have an inventive Opposition Member who is about to try. I happily give way to him.

Mr. Wray

Can the hon. Gentleman explain to the House the reason for all the "for sale" signs on properties in Scotland, England, Ireland and Wales and the fact that so many people are 18 months in arrears on their mortgages while others have had their homes repossessed? If their lives have been changed that much, why do those problems exist?

Mr. Willetts

If the hon. Gentleman wishes me to talk about the development of housing policy, I shall be happy to do so, because there we have another considerable success in the widening of home ownership and the increase in the number of people who enjoy living in homes of their own. The point that I was trying to make on poverty is that we face a dramatic increase in the average living standards of our citizens.

The Labour party then says that there may have been an increase in average living standards, but one has to consider what has happened to the poorest members of society. Have those of us who have enjoyed those increases in living standards discharged our obligations to the poorest members of society? Of course we have obligations to the poorest members of society.

The Select Committee on Social Security commissioned the Institute of Fiscal Studies to investigate the subject of people on low incomes and what has happened to them since 1979. The first point that emerged was that, between 1979 and 1989, the real value of the basic means-tested benefit—initially supplementary benefit, now income support—had increased by 15 per cent. There had been a real increase in the basic value of benefit going to the poorest members of society. That increase was before the latest consolidation into income support rates of payment for the community charge which has increased still further the real value of income support. Therefore, there has been a considerable increase in the real value of the benefit aimed at the poorest members of society.

Then the Labour party says that people are falling through the net and there has been an increase in the number of people living on very low incomes, below those to which they would be entitled if they were claiming income support. That certainly shows up in the statistics, hut again we need to investigate it. What is driving that increase in the number of people apparently on zero incomes? The figures for the poorest 10 per cent. of the population have hardly increased since 1979, because, within that bottom 10 per cent., there are a large number of recorded findings of people living on zero incomes.

Who are those people? There are two main categories. One category is self-employed people, those living above their own shop, for example, many of whom record a zero income. But, describing those people who are disqualified from income support because they have a job, the Select Committee's report states: A significant number of those disqualified are self-employed people who declare very low or zero income. The Committee doubts whether the statistics accurately reflect the living standards of this group. The evidence for that scepticism is that people who declare zero incomes appear in the bottom 10 per cent. and who drag down the recorded incomes of the poorest 10 per cent. record levels of expenditure that are the average for the whole country—if not higher.

Another group in the poorest 10 per cent. are individuals living within a multi-family household. I am sorry to get involved in technical definitions, but it is necessary. An 18-year-old living with his or her parents equals two families living in one household. That 18-year-old is often a student—in fact, that pattern seems to have been driven by the increase in student numbers—and may well have a zero income recorded. In practice, he or she is kept by his or her parents. Nevertheless, that individual will show up in the statistics as a single family with zero income.

When one investigates the statistics more closely, one discovers the distortions that have dragged down the measure of the incomes of the poorest 10 per cent. and notes the increase in the real value of the basic means-tested benefit, some of the assumptions made by Labour's commission about the spread of increased poverty seem rather more questionable. The despairing picture that it paints of low incomes is more tenuous than the miscellaneous professors who contributed to the commissions report may imagine.

The important feature of the welfare state is that it redistributes income across the life cycle. I fully understand, as do my right hon. and hon. Friends, that the welfare state helps people when times are bad and is something to which we contribute when times are good. We can agree on that philosophical underpinning, but that does not take away from the need for reform and for the Government's review.

The circumstances in which people need to call on the welfare state change. The assumptions on which Beveridge made his report do not reflect the way in which we live today. It is essential that any responsible Government examine how the money is spent and whether it can be better targeted. That objective lies behind the Government's review, and it is one that I wholeheartedly support.

Several hon. Members


Mr. Deputy Speaker (Mr. Geoffrey Lofthouse)

Order. understand that one hour is available before the wind-up speeches are to be made. Six hon. Members hope to catch my eye in that time. With a little consideration and co-operation on the part of hon. Members who are fortunate enough to do so, I may be able to call all six hon. Members.

8.22 pm
Mr. Malcolm Wicks (Croydon, North-West)

It is no surprise that both major parties are currently reviewing in their own way—one nationalised, one privatised—the welfare state. I welcome that, because any European Government would want to review not only the forces in society that make for social security but the forces and trends that make for social insecurity. My quarrel with the Government's review—although I may be dissuaded later—is that it starts at the wrong end of the story. It considers what social security cuts can be made, rather than asking about the changes in our society—the way that people live, work and care—that either enhance social security or makes for social insecurity.

I was surprised to hear the Secretary of State say that he is still concerned to avoid dependency in the system. I welcome that statement, but the House should be told why it is that, in 14 years, the dependency culture has increased, and why more and more of our citizens are dependent on means tested benefits and income support, and subject to means testing and the poverty trap. Why is it also that more and more of our children grow up—not just for months but sometimes for years—in families that, because of the lack of employment, know little of independent family living?

At the beginning of this Government's period of office, they attacked the dependency culture, yet today we have more of it. The Government should explain why things have gone so badly wrong. Part of our motion refers to the social fabric, which is a vital, but sometimes elusive, material. We all support it, but we do not always recognise it. I want to talk about that part of the social fabric that concerns family life, and to argue that, in the Britain of the 1990s, it is about time we developed a strong and coherent family policy.

I will give two quotations from senior Conservatives. One said: We need to bring the well-being of families into the spotlight of our affairs. The other said: It is promoting the family which lies at the heart of our philosophy."—[Official Report, 22 May 1979; Vol. 967, c. 1004.] The first quotation was from Patrick Jenkin, as Secretary of State for Social Services in 1979, and the second from Norman St. John-Stevas, as Leader of the House, in the Loyal Address of the same year. Those were good sentiments at the beginning of the Government's period in office, but I question whether that rhetoric has been matched by strong family policy. I do not believe that it has.

History has shown that the concern of the House and of the Government has been periodic. It occurs at times of social malaise and of outbursts of social disorder, such as football hooliganism. More recently, the tragic death of James Bulger on Merseyside suddenly gave rise to concern about the family.

More recently still, the Secretary of State for Wales found himself trespassing on a council estate. He was shocked by what he found there, and to discover the single unmarried parent. The right hon. Gentleman did not question why there are concentrations of insecure families on council housing estates, or give thought to the macro-economic policies that contribute to that dependency. He did not think, either, about public housing policy. He was so shocked that he had an outburst—he had an emotional spasm, as a distinguished predecessor might have said—on the subject of single parents, which contributed not one iota to our wisdom or understanding.

The costs of not having a family policy over the past 14 years, but only rhetoric and waffle, are substantial—socially, economically and in terms of public expenditure. Any decent family policy would want to understand social change affecting the family, start a public debate and devise a new contract about the rights and responsibilities of families, and develop effective partnerships between the family and the state.

Family change is a substantial issue. We are seeing increasing family diversity. More families are breaking down, and more children are being born out of wedlock—often to very insecure families. There are also substantial changes affecting work and the family—the rise again not only of mass unemployment but of the two-worker family. That is a strength contributing to family income—but it also places pressure on child care and contributes to a new agenda of care.

The aging population brings also the development of the four-generation family. Again, that contributes much strength to family life. A grandparent is often the major child carer in respect of grandchildren, but an aging population also impose strains on community care. If we are not to make major mistakes about social policy and public spending, we must understand family change.

The first ingredient of a decent family policy is an understanding of the social revolution of family change. That revolution has brought many strengths to the family, but we never discuss those. It has also brought many insecurities—which we discuss, but often not very effectively.

Much attention has been paid recently to the single, unmarried mother. A survey commissioned by the Department of Social Security from York university showed that, among single parents, only 12 per cent. of pregnancies had been planned. Claims that some very young women—almost girls, frankly—deliberately get pregnant to gain access to welfare benefits are greatly exaggerated. Although only 12 per cent. of those pregnancies are planned, there is anecdotal evidence that from time to time some young women mistakenly and misguidedly think that, faced with unemployment and no education, the only career open to them is to have a baby. It is unhelpful to dismiss all that as mythology.

We should also ask ourselves why women with careers are postponing having children until their late thirties. As so many opportunities are open to those women, one has to ask why some girls of 16 or 17 may be saying to themselves, "Perhaps I'll have a baby. I don't like my family life. I'll get a council flat." If that were true, what would it say about the lack of opportunities and the lack of optimism among some of our younger citizens? Why should they think that it is a good option to live in a horrible council flat on a poor housing estate on a low level of benefit? What would that say about the lack of opportunities in this country?

We are responding badly to family change. We have not developed our education, employment, training and child care policies sufficiently to enable more one-parent families to stand on their own two feet. Then they would not have to depend on social security. If they were to become workers and taxpayers, that would he a gain for them and their children. It would also be a gain for society and the economy.

Why have we not developed a family policy package that recognises the modern patterns of work and life in dual-worker families? Why have we not translated what is all too often community neglect into a true package of community care? Why have we failed so significantly to understand how society is changing? Why have we not asked ourselves about the rights and responsibilities of the family? I am interested not just in rights: I am interested in duties and responsibilities, too.

To be adult and mature, human beings want rights and responsibilities. That is why I welcome the principle of the Child Support Act 1991. I have always done so. I shall therefore badger the Government to make sure that the Act works properly, so that at least some of the child support goes to those who deserve it rather than to the Exchequer—that is, to mothers and their children. The principle of parental responsibility has to be the cornerstone of our social policy. I make no apology for saying that.

We must also consider the partnership that is required between families and the state. To discuss these issues as though either the family or the state should be tackling them is nonsense. It is a piece of social policy illiteracy. Why is it that so many of our young boys—it is the boys rather than the girls—commit crimes at the age of 12, 13 or 14? How do we enable more parents to understand what is going on? We do it through parental training. We need to grapple with these issues so that, together. the family and the state can crack the crime problem, which is such a worry.

Similarly, much of the best education goes on in families. Sometimes, parents are more important than teachers. There needs to he a better relationship between home and school, parents and teachers, if we are to crack these problems.

My main plea is that we do not just talk about the family and turn on the family in times of social malaise. Often, we turn on the family vindictively. We ought to seek to understand what is going on. We must not dodge the difficult issues. We must develop a coherent family policy. Let us all, if we want to, fight to become the party of the family. We should do so, though, not just by means of words and rhetoric, as we are all in danger of doing. but by developing sound policies.

Much of this discussion—although I agree with the hon. Member for Havant (Mr. Willetts) that it should not be all the discussion—is about social security. Why can we not liberate the words "social security"? They have become jargon. They have become something about benefits and dependency. Why do we not ask serious questions about how we can build a more socially secure society? To do so, we must look at employment policies.

We have all referred to Beveridge's review 50 years ago and to the need to update Beveridge. When that grand old man said that unemployment was the largest and the fiercest of the five giant evils and the most important to attack, he was right. He is still right. We talk about full employment in a changing economy and in a changing context, but he was right.

Unless the Government and Parliament decide to attack the evil of unemployment, we shall have too much social insecurity. Any Government who try to grapple with public spending will get it wrong unless they deal with unemployment. Therefore, alongside the crucial need for a family policy, an employment policy that means full employment is the best social security policy that Britain can have—and Britain deserves it.

8.34 pm
Mr. Peter Luff (Worcester)

It is a privilege to follow two of the most thoughtful contributions to this debate. I pay tribute to my hon. Friend the Member for Havant (Mr. Willetts) and to the hon. Member for Croydon, North-West (Mr. Wicks). I only wish that so much more of the debate could have been conducted in similarly thoughtful and reflective terms.

The opportunity to debate these issues is a refreshing one for the House, after so much preoccupation with the "M" word—Maastricht. I had hoped that, throughout the debate, we might have been treated to the kind of speeches to which we have just listened. Sadly, that was not the case. The terms of the motion dictated that it would not be the case. Certainly the terms in which it was moved by the hon. Member for Glasgow, Garscadden (Mr. Dewar) showed that it could not be the case.

When politicians speak as they sometimes do about such important issues, they should be wary of the effect that they have on the electorate at large. The terms in which the debate has been conducted do not do great service to the House when it is dealing with such important issues. It is no wonder that we politicians are not as well loved as once we were. Perhaps I am nostalgic for a past which never existed.

About three weeks ago, I had the pleasure of visiting Stratford-upon-Avon to see Robert Stephens in that fine production of King Lear. In act IV, scene 6, I was brought up with a start when I heard the words of Gloucester, who had just been blinded by Cornwall. He claimed, not unreasonably, that he could not see. King Lear comforted him with the words:

  • "Get thee glass eyes;
  • And, like a scurvy politician, seem
  • To sec the things thou dolt not."

I am afraid that we have had a hit of that this evening.

The motion itself sees things that do not exist. It laments the "destruction of opportunity". What destruction of opportunity, I ask? A higher proportion of our adult population is in work than in any other major European Community country. A recent Organisation for Economic Co-operation and Development survey concluded that between 1984 and 1990 Britain had by far the best job creation record among the larger economies. Spending on training and enterprise is up two and a half times in real terms since this Government came to power in 1979. That is creating, not destroying, opportunities.

What I fear is so often destroyed in our society is responsibility. If only the motion had lamented the destruction of responsibility that can be brought about by a well-meaning but ultimately ill-fated approach to social issues. I think of a lady in my constituency who runs a voluntary group that advises my constituents on how they should respond to difficulties. She says that, during the 13 years that she has run that group, she has kept a metaphorical flag in the corner of her office. She says that she will unfurl it when the first person comes in to ask not about his rights but about his responsibilities. That flag has remained firmly unfurled for 13 years.

The motion refers to the Government's policies threatening the security of many individuals and communities. Here we stray into the delicate area of the relationship between unemployment and crime. That relationship is far from clear, but I know for certain that, in the long term, crime has continued to increase whether employment has been rising or falling. Therefore, the spurious accusation that unemployment is the sole cause of crime in inner-city areas does a great disservice to those who live there.

Dame Elaine Kellett-Bowman (Lancaster)

Does my hon. Friend recall the unemployment rate in the 1930s when people were without jobs but did not resort to crime? They were hard-working, in their own way, and never resorted to crime or used unemployment as an excuse for crime.

Mr. Luff

My hon. Friend makes my point for me, and I am grateful to her. It may be that, at the margin, the devil does sometimes find work for idle hands, but the root causes of the growth in crime are much more deep-seated, as my hon. Friend rightly reminds us, than the experience of some 60 years ago.

The motion refers to the Government's plans to dismantle the welfare state. Again, we see here Labour's claim to a monopoly of compassion. It seems to think that compassion is always best expressed by increasing dependency. That is something which we can never accept. There are no such plans to dismantle the welfare state. I certainly would never be a member of a party that had such plans.

It will be interesting to see exactly what Labour's Commission on Social Justice produces in terms of its findings. If it is being intellectually honest, as it may well be—its distinguished chairman, Sir Gordon Borrie, is one of my constituents, so I am sure that it will be—it may be that the unthinkable will prove unpalatable to hon. Gentlemen. I believe that it is no accident that there are no Members of Parliament on the commission, and I expect that there will be a great rush to distance themselves from the findings of the commission if it produces an intellectually honest result.

Most disappointing of all is the fact that the Labour motion speaks of economic failure—this in a country that is destined to grow faster than any other European Community country this year and next; where inflation is running at its lowest level for 30 years; where interest rates are the lowest in the Community; where unemployment has fallen for five months in a row; where industrial production, manufacturing output, manufacturing investment, retail sales, exports, productivity and car registrations are all increasing.

The Government amendment, on the other hand, adopts a more reasonable position. Before discussing the issues that the amendment raises, I must make it clear that I do not for a moment pretend that poverty, homelessness and unemployment are not very real problems in our society. In my own constituency, Worcester, we have our fair share of all three. I believe robustly and firmly that public spending will always have a role to play in addressing these problems.

For example, we in Worcester have benefited greatly recently from an improvement in the transport infrastructure in the area. There are investments in the railway services to London and in widening the motorway which I am convinced will increase the economic prosperity of my constituency and so address those problems at their roots.

However, I believe that these issues are not just a matter for the Government. We must have an active society, volunteers, individuals, freely participating in our society and making their own contribution to the resolution of these difficulties. Above all, and notwithstanding what the right hon. Member for Chesterfield (Mr. Benn) said earlier, we must have enterprises, businesses, making their own contribution through the profit motive, through helping to create the prosperity that is fundamental in addressing those issues.

Dr. Tony Wright (Cannock and Burntwood)

I am interested to hear what the hon. Gentleman says about his constituents in Worcester. I was a candidate in Worcestershire in 1979, and I remember the situation very well. The great appeal of the Conservative party was that socialism was the cause of crime. Indeed, Sir Keith Joseph, now Lord Joseph, used to go round saying that, and Mrs. Thatcher, as she then was, used to say it. This had great appeal in Worcestershire, and it did me no good at all. It did my Conservative opponent an enormous amount of good, showing the connection between socialism and crime.

On the matter of intellectual honesty, perhaps the hon. Gentleman could explain to us why crime has increased by 120 per cent. since 1979. In my own area, it has increased by 200 per cent. So there is something rather intellectually dishonest about the argument, is there not?

Mr. Luff

I do not know whether the hon. Gentleman was in the Chamber during my earlier remarks, when I talked about the long-term secular increase in crime and said that the problems that led to that increase were much more deep-seated than simple factors of unemployment, and so on. I believe that he and I are more in agreement on this issue than he realises. I am glad to say that. Now that socialism, as I understand it, is dead in his party—or so we are led to believe—the problem of which he speaks has anyhow disappeared.

The Government amendment talks of protecting the vulnerable, and indeed we must do so. The tests of the last social security review set out in the document "The Growth of Social Security", which is in many ways the bible of this debate, should be applied to the current review, too. But I want to add three of my own.

Yes, of course, we must first, above all, help the disadvantaged members of our society. But the review should concern itself particularly with the problems of the ederly, and it should set as one of its preconditions that money should not be taken from those currently receiving benefit, but that the Government should, wherever possible, seek to refine future benefit systems to ensure that people who are currently in receipt of benefit are not disadvantaged. I know from my constituency surgery that very real anxiety exists in some people's minds—those on invalidity benefit and retirement pensions—about the prospects of the review. I believe that those fears are misplaced, and I hope that my hon. Friend, in winding up this evening, will be able to give me that reassurance to take back to my constituents.

We talk as well in our amendment about the nation's ability to pay. I think back to my noble Friend Lady Thatcher and the great battles that she fought for the heart and soul of this country. She fought a battle against communism, and won it; she fought a battle against trade union power and the abuse of that power, and won that battle, too; she fought a battle against nationalisation, and won that; she fought a battle for home ownership, and won that; she fought a battle for the rebirth of the enterprise culture, and won that, too.

Sadly, there was one battle that she lost. That was the battle to persuade the people of this country, and particularly the Labour party, that there is no such thing as Government money; there is only our money. Still, that is 5–1 to the noble Lady, and that is not a bad record. But it is a great shame that she lost that last battle, because, if she had not, the terms of this debate would have been much more informative.

We also talk in our amendment about scaremongering. This sounds like a narrow partisan point, but it is something which I hold very dear. The way in which so much of this debate is being conducted is scandalous. I know from my constituency surgery how the fears that have been artificially inflated by the Opposition are expressing themselves in my constituents' minds, and the great concern they feel—which they need not feel—about our plans for the future of the social security system and their welfare.

I ask Opposition Members, when they think about the consequences of their scare stories, please to remember the effect that these totally false stories have on the poor and underprivileged members of our society.

Finally, our amendment talks about the failure of the Opposition to produce responsible alternative policies. They are not alone in this regard. Most local and national newspapers in this country seem to call for increased expenditure in every area and to oppose any attempt to raise revenue to pay for it. So Her Majesty's Opposition are not alone in that.

It is disappointing, however, as a number of my hon. Friends have remarked, to note the lack of any positive suggestions from Labour Members for addressing the alleged deficiencies of Government policy. Perhaps the Commission on Social Justice will in due course produce such positive suggestions, although somehow I doubt it. But, as I said earlier, if it does, I suspect that we shall see the Labour party distancing itself from them very rapidly.

The question that this whole debate raises is how many of the issues with which the motion is concerned are for politicians. Sometimes they are firmly in our court; sometimes they are not; and sometimes they are matters for both politicians and wider society.

I look, for example, at the issue of housing—a subject which a number of hon. Members on both sides of the House have mentioned. I fully accept the need to increase the level of provision of affordable housing. There is a need to enable housing associations to build more housing for rent. I make no secret of that fact. But, equally, I do not believe that we should be driven, in planning our housing provision, by a simple view of the likely continuing rate of household formation.

Dame Elaine Kellett-Bowman

Does my hon. Friend not agree with me that young, vulnerable, single mothers, aged 16 or 17, would be infinitely better off in hostels with other people the same age, able to be given support, than being shot right to the top of the council housing list and given their own homes? They would get support, they would be able to club together and babysit; they could go out and get employment. It is not kind to young single mothers to give them homes of their own.

Mr. Luff

I not only agree with my hon. Friend, but believe that many young single mothers now living on their own in council accommodation are doing so because they have been actively encouraged to move out of their parental homes by social services departments. Many of those single mothers would be better off, not in the hostels of which my hon. Friend speaks, but in their parental homes, where they would receive the love and support that they need in sometimes very difficult personal situations.

I do not believe that our planning for housing provision should be driven entirely by an acceptance of household formation rates. That is why I am working in my constituency with the Bishop of Worcester to examine ways in which we can remind young people of the consequences of walking out of their family homes because they have had a row with their parents, and what that means to them in terms of the quality of life that they are likely to enjoy later.

We are working in schools to encourage young women, in particular, to understand the consequences of casual sexual intercourse and what that might mean for their own demand for housing and the quality of their lives later.

I hope that that initiative will bear fruit and make some contribution to reducing the rate of household formation, which we should not accept as a given.

I shall truncate my remarks to enable other hon. Members to take part in the debate. We must pay particularly careful attention to the elderly. We have targeted the elderly, particularly the single elderly with modest means—those with perhaps small pensions or savings—adversely. The effect of the change from community charge to council tax has been serious for some single residents in my constituency with modest pensions and no eligibility to benefit. The effect of VAT on domestic fuel will be worse for them than for those on benefit, who will be compensated. I hope that we shall be careful in our review of single pensioners above the benefit levels.

I have heard much in the debate about the need for increased expenditure on benefits. Some Opposition Members have admitted that the PSBR is of concern, yet ultimately they have failed to identify and address the problem and have simply called for extra resources. Noticeably, the hon. Member for Garscadden completely failed to answer the Secretary of State's question about the need to identify one country that was not reviewing its social security spending. The hon. Gentleman declined to answer the question. He knows that they are all doing it. That is why the Government are right to conduct the review.

I am disappointed by the crude, yah-boo politics of the motion. I am also insulted by the gross misreading by some Opposition Members of the sincerity of the Conservative party's dedication to the condition of the people, as a former leader of my party once described it. I fear that if they do not face up to the difficult choices that lay before them, they will never be fit for Government.

King Lear, shortly after his comments to Gloucester, remarked: When we are born, we cry that we are come To this great stage of fools. I wonder whether he had been listening to Opposition Members.

8.51 pm
Mrs. Alice Mahon (Halifax)

Does the hon. Member for Worcester (Mr. Lull) think that the elderly, the sick and the poor will take comfort from those words of King Lear?

I am pleased to have been present for most of the debate, because there have been some excellent contributions from my hon. Friends, who have laid out clearly the philosophy of the Government and their supporters towards people who, for whatever reason, become unemployed and people who are sick, elderly and in need of help.

The debate has taught me a lot about the thinking of Conservative Members. Whenever I hear the sort of remarks they make about single parents, I am reminded of their use of scapegoats. The Government are superb at finding scapegoats. The hallmark of any bully is the need to find someone who is weak and vulnerable and then to isolate that person and use him or her as a scapegoat. The Conservatives have been doing that for the last 14 years. My right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris) spoke of the way in which even the terminally ill are being targeted, and we have heard much about single mothers.

The idea that 16-year-olds who become pregnant—I believe that they total about 45,000—are about to end civilisation as we know it would be laughable if it were not tragic. The idea of putting such "deviant" women in hostels skips a century. It takes us back to the deserving and undeserving poor, the workhouse and the poor law guardians. Even at my age, I know nothing of that, and have only read about it in the history books.

When I tell the members of the Halifax pensioners association that it has been seriously suggested in the debate by Conservative Members that there should be a granny tax to pay the expenses of single parents, those elderly folk may think that they had better start producing petitions on issues other than the shutting of post offices and the imposition of VAT on domestic fuel.

The Conservatives have had some success over the years with the tactics of blaming others for their mistakes, and my right hon. Friend the Member for Chesterfield (Mr. Benn) was right to say that they have resorted to that tactic because they are the Government of' unemployment. They want low wages and to undermine trade unions and any institution that protects working people. They instil fear into the public, so that when people are asked why they put up with it, they respond that they are frightened to do anything else.

In that context, some of the words in the Government amendment are chilling, particularly the reference to the Government's approach to the reform of social security, which is designed to improve the system, protect the vulnerable". We have been down that road before. They said something similar in 1988 when they introuduced discrimination against the young in benefits, the area on which I shall concentrate because it is a subject about which not enough has been said.

Youth unemployment now stands at I million. In other words, one in three of the unemployed in Britain is aged under 25. I emphasise at the outset that I would like them all to have jobs, and I know that I speak for all Opposition Members when I say that. I am anxious tonight that the Minister takes careful note of what is happening because of the discrimination in benefits, especially as he and I shared a platform recently on the "Today" programme when we discussed the issue.

A million youngsters are unemployed through no fault of their own. The amount of income support they get depends on their age. If they are 16 to 17. they have no entitlement to benefit. Nor do they have the guarantee of a YTS place, and I hope that Conservative Members will not argue that all youngsters get a place on the YTS scheme. More than 100,000 do not have a place on the scheme, nor do they have any entitlement to benefit.

I hope that my remarks about that will not be challenged because even if they succeed in going through the hurdles to obtain a hardship allowance, they are given only £15. They are means-tested before they get it and after a few months it comes to an end. If the Government are seriously examining social security and benefit levels, they must examine that issue because it has been a disaster for young people.

About half a million 18 to 24-year-olds are trying to live on £4.97 a day. The Under-Secretary has £122.22 a day to live on, while the Secretary of State, who likes to sing at party conferences. has £172.73 a day. Yet they think it fair a person who, through no fault of his or her own, cannot find work and is in the age bracket 18 to 24, should have to manage on £4.97 a day.

The Secretary of State is fond of singing about people having little lists. He has a list, and he has made fun of it. A person living on 34.80—there are 200,000 or more in that age group living away from home—and managing independently has quite a struggle. We are not referring to people living with parents. They are trying to manage independently.

I assure the right hon. Gentleman that they, too, have it little list. They would like three meals a day, gas and electricity bills must be paid, water rates come due—we have heard how they have increased, and there are no rebates for those in the group I am describing—and they must also pay for their laundry and household insurance, although for many of them the latter is just a dream because they cannot afford it. They must also replace their clothing and footwear, buy household items and have money for fares for job hunting, plus stamps and stationery for the same purpose. They may need money for a newspaper and for a television licence; I recently discovered how many people are serving prison sentences in Yorkshire because they could not afford to buy one.

Young people also need money for leisure activities and for one-off occurrences. One young man who recently came to see me had been turned down for a one-off payment—he needed money to go to a loved one's funeral in Liverpool. The Government say that people in that age group must meet all such expenses from £4.97 a day, but it cannot be done.

There will be social consequences of such a mean and punitive benefits system, which will become even meaner and more punitive after the review. There is no question but that there is a link between increasing poverty, crime and shoplifting. Young people who are denied a stake in society of course risk becoming involved in crime. I shall not detain the House very long, but my hon. Friend the Member for Nottingham, South (Mr. Simpson) will tell us about a young man forced into prostitution because of inadequate benefits.

Youngsters are often forced into a world of drugs because they have no future and cannot participate in society. The shops are full of goods that they have no means of buying. Relationships break down in the parental home, which means that many children have a had start in life. Some of us warned the Government about that when they introduced the disastrous cuts.

Youngsters are alienated from society because they arc not considered to be adults until the age of 25, although they were considered adults when the Government said that at 17 they were old enough to die in the Gulf war.

We are creating a counter-culture, breeding an underclass who are being pushed into lawlessness through boredom and the fact that they are excluded from everything. Many live in a twilight world, and I feel desperately sorry for them. They are a lost generation—"Thatcher's children" is a phrase that comes to mind. The Thatcher years created the problem. and the present Government are reinforcing it.

The youngsters I am talking about do not live in a Gilbert and Sullivan society on £177 a day. They cannot have a good dinner in one of the posh restaurants in this place. They are scratching around trying to find enough to cat. At the end of the day, society will pay a high price for the Government's recklessness.

9 pm

Mr. James Clappison (Hertsmere)

I welcome the opportunity to participate in a debate in which we have heard some thoughtful and constructive contributions, most notably from my hon. Friend and Member for Havant (Mr. Willetts) who spoke with great vision about the fabric of society. His speech was more wide-ranging than that which we heard from the Opposition spokesman. I hope that the Opposition will not mind if I say that the hon. Member for Glasgow, Garscadden (Mr. Dewar) opened the debate with a great deal of hollow rhetoric which lacked credibility.

The premise from which the motion and the hon. Gentleman started was a return to the well-worn rhetoric that we heard so many times in the 1980s. His talk of cuts and attacks lacked credibility because he cannot disprove the fact that there has been an enormous increase in the social security budget since 1979. By any measure, historical or otherwise, there has been an important real terms increase in social security benefits across the board—for pensioners, for the long-term sick and disabled and for housing needs.

If one measures the growth in the social security budget since, say, 1949, which I am sure some Opposition Members would consider a golden year, one realises that there has been a substantial increase in real terms spending and in the level of social security spending as a proportion of total Government expenditure and of gross domestic product.

What emerged clearly from the analysis by my right hon. Friend the Secretary of State and my hon. Friend the Member for Havant is that there has been a structural increase in the social security budget, aside from the issue of unemployment. The hon. Member for Garscadden is hard pressed to deny that.

Even allowing for a fall in unemployment, the 3 per cent. per year rise in structural terms in the social security budget is an increase that we cannot afford when we have such a large public sector borrowing requirement. It is therefore entirely right and proper that there should be a review of social security benefits. The Secretary of State deserves support in conducting the review, which is absolutely essential if we are to tackle the PSBR. I see that the hon. Member for Garscadden is looking interested. so I will give way to him.

Mr. Dewar

Is the hon. Gentleman saying that a review means an exercise in reducing benefits and expenditure? If so, what targets should we be looking for in the next Budget?

Mr. Clappison

If I were to say that I accepted that expenditure was too high and had to be examined, I would be using exactly the terms that the hon. Gentleman used. The facts are inescapable when the PSBR has reached its present size. The hon. Gentleman's position on that issue was more sophisticated than that of the hon. Member for Truro (Mr. Taylor), who has now returned to the Chamber. After a considerable period of absence, he is the only Liberal Member present. He said that the Liberal party would not be prepared to change the social security budget and that, even if a structural increase were made, it would have to be paid for out of taxation. According to his analysis, those who have benefited most since 1979 should pay most.

That was an interesting proposition, especially just before the Christchurch by-election. Does it mean that the Liberal party will go into the by-election with "soak the rich" emblazoned across its battle bus? I remind the hon. Gentleman that, since 1979, the top rates of income tax, investment income surcharge and capital taxation have been considerably reduced. All those issues will he of considerable interest to the Christchurch electors.

Mr. Iain Duncan Smith (Chingford)

"Soak the rich" is far from what the Liberal Democrats will be saying at the Christchurch by-election, but that is what they will mean.

Mr. Clappison

I am grateful to my hon. Friend for that intervention. "Axe tax" will be written in large letters on the back of their battle bus.

Mr. Matthew Taylor

indicated assent.

Mr. Clappison

I note that the hon. Member for Truro is indicating assent. It is an interesting position for him to take.

Mr. Taylor

I was indicating assent to the long list of tax cuts for those on higher incomes. It was quite accurate. I did not argue that we should restore tax to its 1979 level: I said that it seemed inappropriate that the Government should target those on invalidity benefit, for instance, without proposing that the whole country should share in tax cuts. The rich have benefited most from tax cuts and those on lower incomes have benefited least.

Mr. Clappison

I see another green paper approaching from the Liberal party to bail it out, just as it produced a green paper—or was it a blue or red paper?—to bail it out of its problem on energy tax.

The Labour party has conceded that there must be a review and produced its own Commission on Social Justice, which has turned its hand to the task of reviewing the social security budget. As the hon. Member for Garscadden said, it produced its first fruits today. I agree with the analysis of the review by my hon. Friend the Member for Havant. He analysed the value of benefit and the critique by the Commission on Social Justice, and showed clearly that there has been an across-the-board increase in income and prosperity, including an increase in real value of benefits.

Moreover, the review of the Commission on Social Justice complains about differences in the geographical dispersal of infant mortality. It is an interesting criticism because since 1979 infant mortality has substantially diminished. In the past 20 years, it has fallen by half in all areas, including those to which the commission refers. Perhaps the commission would be happier with a uniform but higher level of infant mortality—[Interruption.] This is a serious matter, because it has been raised by the so-called Commission on Social Justice. It may prefer lower levels of infant mortality across the board.

The commission also complains of innumeracy among adults, which comes as a surprise to those of us who are committed to the Conservative party's education reforms and the standard attainment tests. I remind the hon. Member for Garscadden that the standard attainment tests for seven-year-olds, which the Labour party bitterly opposed, have resulted in a substantial improvement in seven-year-olds' reading abilities. In 1991, 72 per cent. of seven-year-olds attained the target and, in 1992, 77 per cent. attained it.

I urge the House to support a responsible and constructive approach to the social security review. I can do no better than quote the words of Beveridge himself. My right hon. Friend the Secretary of State hit the nail on the head when he spoke of the spirit of Beveridge, and I remind him of what he, quoting Beveridge, said in his Mais lecture: The state in organising social security should not stifle incentive, opportunity, responsibility; in establishing a national minimum, it should leave room and encouragement for voluntary action by each individual to provide more than that minimum for himself and his family. I commend that approach, and I am confident that my right hon. Friend is following it.

9.9 pm

Mr. Alan Simpson (Nottingham, South)

Let me put the debate into a context that makes sense to me. We would not be having the debate if the Government were confident in what they say to the House about our being on the verge of economic recovery. We would not be having it, either, if Labour Members were not aware, from meetings that we attend throughout the country, that the people do not believe that there is a recovery in the offing.

We would not be having the debate if the Government did not know that they face not only a crisis in their domestic borrowing and spending programmes, but another crisis that will loom as the gap between manufactured imports and manufactured exports widens. That will precipitate a crisis that will include a run on the pound, which will herald a new wave of austerity measures.

The Government are preparing their next round of austerity social policies. That is the context in which the debate is taking place. We are not on the verge of a recovery; instead there is a lacuna—a pause between the current economic crisis and the next economic catastrophe.

In that context, I shall challenge just three of the major hypocrisies in Government policies. The first is the claim that the Government care about people's housing prospects. I shall examine that idea against another set of reference points that they refuse to mention.

Millions of households face rising mortgage debts that they cannot service. Millions of people own properties worth less than the mortgages on them. The burgeoning of personal debt and repossessions is causing local authorities to throw up their hands in horror and wonder what the hell to do about the growing problem of homelessness being created by the Government's policies.

I set that development against the fact that public sector house building has virtually ground to a halt. For example, in Nottingham, the city council now has about 20,000 households on its waiting list, and in the greater Nottingham area, 2,516 families received housing repossession notices during the past year.

Yet how many houses for rent were built last year? The grand total was 217. How do we account for the gap? What are we to say to families who turn up on local authorities' doorsteps? Do we say, "The local authority can buy your house back"? Do we hell as like. The authority used to he able to buy back council houses, but now it is a requirement that the families he evicted and the houses sold on the private market.

Do we say, "The Government will tell the building societies and banks that evictions must stop, and that they must convert mortgages into rents"? We do not. We have to tell people that the Government will take no steps beyond repeating platitudes. Do we say that we will allow local authorities to build again, to meet the needs of the people forced into homelessness by the Government's economic crisis and by their lack of interest in public sector housing? We hear no word of that.

Some Conservative Members have talked about homelessness as though it were an act of fecklessness. According to them, young people walk away from loving families, and it all takes place over the breakfast table. Parents say, "Eat your sprouts," and the children reply, "No, I don't like sprouts; I'm off to get a local authority house." I wish that those Members would come with me to social services departments and find out about the crises in family lives that local authorities have to deal with. We would see whether they would still talk about fecklessness then.

Conservative Members expressed concerns about illegitimacy. However, the greatest illegitimacy in this country today is the fact that we have stolen from people the right and the opportunity to live in a decent house. We make the right to a decent house sound dirty. People may not be able to afford to buy a house, but they still have the right to expect one. We treat them as though they are somehow dirty people, as if they are not worth it and they are a burden on the state. I tell the House this: if any state cannot offer its people the prospect of decent housing, there is something wrong with the state, not its people.

The second big lie that the Government run with is that they care about families. Conservative Members ask why the Labour conference rejected the idea of support for the Child Support Agency. It is simply because those at the conference knew that the Child Support Act 1991 was a misnomer. It should have been called the "Government Support Act", because it was about turning on families, setting parents against each other and punishing children to reclaim money. It was an Act not for families or children, but for the state.

The Government have turned on Families because they are short of money. The Government have said—not in the spirit of the Children Act 1989, where children were to be put first, but in the spirit of self-interest and crisis in their own management of the economy—that money must be drawn hack in. Vulnerable people must be found so that they can then he blamed, and so that the Government can put the boot in.

The Labour conference refused to support the Child Support Act for those reasons, not because it did not want to make it possible for both parents to he decent parents. The Labour party did not want to go down the path that begins and ends in punishing children, punishing caring parents and pushing deeper the divide between those whose family lives have been broken apart. I hope that the Labour party sticks to that path.

The third Government lie that I shall address is that they care about young people. I am fed up with visiting schools in my constituency where children have to learn in crumbling classrooms. In the schools that my own children attended, I was fed up with having to discuss whether children were allowed to take hooks home because they might not he returned. Why might children not return books? Because they did not have any other books in their homes. I would rather that children took hooks home and that the books did not come back, than to have to tell children that they could not have books.

That is an example of some of the hard decisions that are being made in inner-city schools today. The basis of funding in schools is based on age-weighted pupil ratios, not on a needs basis that would allocate additional resources to those who have the most ground to make up. We punish children. There is no care and compassion for children in Tory schools policies.

What are we saying to those people who have left school? To the young people of Nottingham, the Government are saying that, in the past three years, the number of young people between the ages of 16 and 24 who are without a job has increased by 80 per cent., from 6,535 to 11,815.

When I think of Government policy towards those who have no job, I am reminded of the words of a song by Woody Guthrie called "Pretty Boy Floyd" that says: Some people rob you with a sixgun and some with a fountain pen. I am sure that "Pretty Boy Lilley" has convinced young people—the 100,000 who are aged 16 and 17 who have to live on fresh air, and the half-million who have no job and must live on less than subsistence level—that he is fast on the draw and quick to kill them off with his pen. That is the care and compassion he offers.

A delegation of young people came to the House a week ago. Not a single Tory Member was present at that meeting at which a young lad called Jason said: I was forced to leave home at 16 when …my mother and stepfather found out that I was gay…I ended up homeless. I then went to the local DSS office, who told me I was not entitled to any money. I tried in vain to get a YTS placement, but because I had nowhere to live nobody was willing to offer me a job, and without any income I couldn't find a place to live. So I suppose in a way it was a catch 22 situation. I have lived in various night shelters. but without money it was very difficult to feed and clothe myself and keep a tidy appearance for job interviews. At that time, I knew a couple of prostitutes. One of them told me that she had a bisexual punter who wanted some business with a young lad. I had not eaten for several days so I agreed to do it. It was the most difficult decision of my life. Though I don't think that I really had any choice at the time, it was either that or starve. This went on for nine months, until I was seen by a mental health worker and referred to a local hostel for young people. I was one of the lucky ones—I got a place there. I thought that was the end to all my problems, but I was wrong. Two years later, when I finally was offered a council flat, I had a lot more to deal with than I had expected. I was trying desperately to keep on top of my bills, but couldn't, and ended up in hospital after taking an overdose. The thing I found hardest to accept was that, because I was under 25, I was supposed to have less money needs than someone over 25. My next-door neighbour found it hard enough to manage paying his bills and so on, which were exactly the same as mine, but because he was over 25 he got more money. I think it's about time this Government realised the hardship, poverty and damage they are doing to young people in this so called classless society, That is how young people are being treated by the Government; and the Government must be judged against such a measure.

What will happen when the Minister goes into the dock to face that criticism'? He comes across as the Michael Sams of social policy. He stands there and says, "It wasn't me—I offer you another illusion or delusion. A friend I cannot name was responsible for it all."

Labour Members' constituents know that that is simply a lie. What is more, people of all ages know that it is a lie. I spoke yesterday to a group of pensioners in my constituency. I asked them, "What do you want the Government to do?" They said, "Take the young people off the dole. Get them to build houses; team them up with skilled tradespeople to give them skills that they can use in a society that is fit for us all to live in tomorrow. Let them put insulation in our houses. Let them help us to reduce our heating hills. so that the meagre pensions we have to live on go further."

I have another meeting with that pensioner group tomorrow, at which I shall tell them of the wonderful idea that floated from across the Chamber, about the "Wisconsin" experiment of making grandparents responsible for the costs of their grandchildren. Perhaps we do need such an experiment. Let us take a family who are, as the Tories would say, living off the back of the state, who have never done a day's work in their lives and who are responsible for loads of kids or grandchildren. Let Tory Members go to Granny and tell her that she is responsible. I shall come with them, because I should like to see the look on the Queen Mother's face when they tell her that.

You see, Madam Speaker, it is a question of where we start, who we deem to be the social parasites and who is pulling their weight to make ends meet in society. Many of the families I know, whom the Government try to caricature so harshly, work to provide decent lives in ways that Tory Members do not understand. It is an insult to hear those families caricatured and derided.

I go back to that meeting tomorrow knowing that what people want is reinvestment in a social fabric which they see disappearing before their eyes. When Conservative Members dive into the word "dependency", Labour Members must leave them to go off on their own. What we are talking about is not a nanny culture but an understanding of interdependency—a society that does not steal from itself and all do not steal from each other's future, but where all invest in each other to give the children of today the prospects of tomorrow and of accepting the responsibilities that we would like to share.

That is what society outside the Chamber knows. It does not matter whether the Government will recognise it. In fact, it does not need to wait for permission from our Commission on Social Justice to be heard. It is a message that already is not waiting for permission to express itself outside the Chamber or inside the country. The sooner Labour hears that message and stands up and argues for it, the better we will be—here and in the country as a whole.

9.23 pm
Mr. Iain Duncan Smith (Chingford)

It is intriguing to listen to charges that the Government have crushed the worst-off, attacking those on benefits and thrashing everybody who is on the bottom levels of income. Then I look at the figures, which show that we have increased spending on social security by 75 per cent. Social security now accounts for one third of total Government expenditure—it did not in 1979—and has reached a total of £80 billion a year, or £13 per person per working day.

It is an absurdity that the Government must listen endlessly to the Opposition's charges, when those charges fail to deal with the reality of the figures. Those figures speak louder than any of the Opposition's rhetoric. If we carry on increasing that total at the same rate without a careful examination, we will cause major structural problems for the economy.

Reform is necessary—I use the word advisedly. But it does not mean that there will be massive cuts or a dilution of certain benefits. Reform means looking at what is required and what is not required, and how the money is focused. Reform is necessary, because the current rate of expenditure will result in a cycle of higher spending and higher taxes which will lead to higher inflation and will distort the labour market.

That last example is what has essentially been happening for the better part of 40 years. There is, of course, no bottomless bucket of money, and even if there was such a bucket, it would be madness to go down the road of spending on everything imaginable. That would distort the methods of a society that was going out to work and generating income from other sources.

The key thing may be to look back at the original Beveridge plan. I am aware that other hon. Members have touched on that subject, and I do not intend to go into it in great detail given the time. I think that Beveridge was aware that the achievement of a national minimum for all was the essential objective of a welfare state. But he went on to say: The state in organising security should not stifle incentive, opportunity or responsibility in establishing a national minimum. It should leave room and encouragment for voluntary action by each individual to provide more than that minimum for himself and his family. That is crucial and lies at the core of what a welfare state is about. It is about identifying and looking after those who are most in need, and making sure that the most amount of money is focused on those people.

That does not mean that money should be spread wide to catch everyone, while perhaps missing out on the odd person. It is about focusing on those in need and encouraging those on the margins and helping them get back into work. The problem has been essentially the method with which Beveridge was implemented. He saw it as a 20-year implementation plan. His idea was that the scheme was introduced slowly, to make sure that the economy could bear the strain, and that every cost was met.

Two things resulted from the major change which followed the Labour party's implementation of the scheme. First, I believe that the voluntary sector was rapidly stifled. I believe that the voluntary sector would have grown alongside the welfare provision to provide many of the things that we now take for granted as coming from the state. I would even widen that, to talk about areas of insurance that could and should he widened to allow the private sector to become involved.

Secondly, the lie has grown, and is believed by most of the public, that national insurance in some sense was providing for their future. and still is. Many hon. Members are told time and time again at their surgeries that people have paid for their future with their stamps, and should be able to collect something at the end of it. The lie has grown that national insurance is some form of insurance scheme against the future.

The reality is that it is nothing more than an extra level of taxation, providing for those who need benefits. It is a reality problem. The public must understand why they pay into national insurance only to be told that the reality is that there is no insurance. If they had been in a private sector scheme, they would have had a real insurance scheme that had been put somewhere to invest. But Governments of all complexions have raided national insurance over the years, and used it to pay for what was happening at the time.

It is perhaps time to look back. In 1942, in an exchange of notes, Sir Kingsley Wood prophetically said: the scheme is presented as contributory but like the existing system depends on a deficiency grant, which will grow in the course of time to immense proportions. from the general taxpayer. He went on to warn: acceptance of the complete plan involves a contract with many millions of beneficiaries, the continued fulfilment of which would properly have to be, in good times or had times alike, a prior charge upon the national resources. To some degree at least, that has come true.

It is absurd to suggest that we should not be thinking of change or reform. Many of the Opposition's speeches today reminded me of "Jurassic Park"—vast dinosaurs charging around and trumpeting ideas whose time has gone. They still say that every case that has ever gone wrong and every case of need has been the fault of the Government, and that the Government must dip into their pocket and raid the Exchequer for more money. Worst of all is the hon. Member for Glasgow, Garscadden (Mr. Dewar) who, like Tyrannosaurus Rex, charges up to the Dispatch Box and snaps at the Government for spending or for not spending, while proposing not a single alternative. That is both absurd and outrageous. The public should be aware that the Opposition have done nothing but level unproven charges at the Government, who in their turn have dramatically increased spending on social security.

I urge the Government to go ahead boldly and implement the necessary reforms, and most of all to ensure that we focus properly on where the money is needed.

9.31 pm
Ms Marjorie Mowlam (Redcar)

Listening to the hon. Member for Chingford (Mr. Duncan Smith), one wonders about the evolutionary strains to be found on the Conservative Benches. What he said in the last couple of minutes showed up the differences between our parties. Had he listened carefully to Opposition Members, it would have been evident to him that the Labour party wants to modernise the social security system because we want people to have the opportunity—they do not have it now—to develop their talents and skills to the full.

By contrast, Conservative Members and the Secretary of State, in his introduction and in comments that he has made before, show their desire to dismantle the welfare state. That difference ran through all the speeches today. The hon. Member for Chingford talked about expenditure, but he cannot deny that the increase in expenditure is largely due to unemployment.

A number of speeches by Labour Members have pointed up the destructive policies that the Government have followed, harming not just the social fabric of society but communities and families. My right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris), a doughty fighter on behalf of people with disabilities, clearly showed the concern that many disabled people have about the changes and the proposed cuts in benefit. The Minister said that he was not interested in cutting; he just wanted to cut growth. I think that that is a cut. He also said that he would introduce an objective test for invalidity. That means that the test will be Treasury-driven, not related to need.

The Government do not understand why people get scared about all this, even though Conservative Members admit that people on invalidity benefit are frightened. The Government promised no increase in VAT for pensioners. yet there was one. Indeed, there have been a number of U-turns since the election promises. That is why people on invalidity benefit are anxious.

We heard moving contributions from my right hon. Friend the Member for Chesterfield (Mr. Benn) and from my hon. Friend the Member for Renfrew, West and Inverclyde (Mr. Graham). Both spoke about what unemployment has done to people's lives in the past 14 years.

We have heard a great deal from the Government about citizens' basic rights and we have been subjected to numerous charters. The one basic right to which people should be entitled is the right to work. Any social security system would have difficulty surviving the high levels of unemployment that we are now experiencing.

We heard a robust contribution from my hon. Friend the Member for Edinburgh, Leith (Mr. Chisholm), who talked about the problems that families face, whatever shape or size they come in. He talked about our idealised vision of families and what happens when the difficulties of abuse and domestic violence are faced. He said that many families, particularly single-parent families, need a chance to find a pathway out of poverty. That could be done through the provision of child care. If child care was flexible, affordable and accessible, many young parents would be able to move out of their current poverty.

My hon. Friends the Members for Nottingham, South (Mr. Simpson) and for Halifax (Mrs. Mahon) spoke about the lives of young people. My hon. Friend the Member for Halifax referred to them as "Thatcher's children". We cannot ignore what is happening to young people.[Laughter.] A lot of sniggering is coming from the Conservative Benches, but I defy any Conservative Member to talk to 16 to 18-year-old constituents who are alienated by the system. We as a country, and as part of this political system, ignore what is happening to those young people at our peril. They feel no connection with our political system.

My hon. Friend the Member for Croydon, North-West (Mr. Wicks) had much experience of family matters in his previous job. He made two important points. One was the problem of the dependency culture created by benefits. He posed a question that he often asks. If more and more women who are happy in their careers are waiting longer and longer to have children, so that they are in their thirties before they have a family, why do young women who do not have opportunities or hope—and when no part of the system acknowledges them as having value—behave differently? That is a question we have to answer, and we can do so by introducing a policy for families that produces a partnership between the state and parents.

Several hon. Members have mentioned the difficulties that young single parents experience in bringing up their families. Many positive things could be done in relation to parental training and offering support—not what the hon. Members for Tiverton (Mrs. Browning) and for Worcester—

Dame Elaine Kellett-Bowman


Ms Mowlam

I am sorry, it was the hon. Members for Tiverton and Lancaster (Dame E. Kellett-Bowman) who mentioned hostels. Introduction of hostels would repeat the problems that young people are already suffering. We would be saying to children who are in difficulties through no choice of their own that they must go through the same experiences as their parents.

Dame Elaine Kellett-Bowman

That is the opposite of what is intended. If eight or 10 young mothers live together in accommodation, they can obtain support and advice. If they are alienated from their families and cannot go back to them, they are not left alone, day after day and night after night. in a council flat. They can come together, talk about their problems and mind each other's children, and some can go out to work. That is the kind of support that young mothers need—support that does not leave them isolated in a 18-storey tower block.

Ms Mowlam

Where did individual choice go? We have heard a lot from the Government about individual choice, but returning to a form of workhouse is not the answer. Of course support, opportunities and a pathway out of poverty are needed, but that will not happen by putting young mothers together, marking them and saying to them, "You are different from the rest of society." When their children go to school from those houses, they will be told, "You come from the hostel house down the road." That will not give those children a new opportunity in life; it will be dictating to them how they should behave.

Mr. Quentin Davies

I do not think that the hon. Lady has given credit to what is quite a serious idea. In South Kesteven, in my constituency, we have a system under which single mothers who come to the council and say that they wish to be housed and demand their statutory rights are not put immediately into a council flat or council house. They go into a hostel for about 18 months, and 40 per cent. of those offered hostel accommodation, which is perfectly decent and clean, prefer to go back to mummy.

Ms. Mowlam

Stigmatising families, which is what one would be doing, is not the answer. Surely the answer is to say that we have a housing shortage. Whether they are single parents with children or whether they are two parents with children--hon. Members know the problems that many families experience, as the hon. Member for Tiverton said—surely the answer is to build more houses rather than mark one family out against the other.

The hon. Member for Havant (Mr. Willetts) usually gives an intellectually stirring performance. It was depressing to listen to the general waffle and wander that we have heard from him today. He talked about the social fabric of society and of the importance of the voluntary sector, and the hon. Member for Chingford made the same comment. I agree that the voluntary sector is crucial to the social fabric of our society. The voluntary sector has been squeezed by the Government's policies.

For example, the National Association of Citizens Advice Bureaux is closing many of its offices. A classic example is Relate, which is there to help people to stay together in a marriage. Its money is in question for the second year running. If that is giving the voluntary sector support so that it can function, goodness knows what the opposite would be.

When we look at what Relate does for families we must be careful to say exactly what we mean when we refer to the family. The trap—some hon. Members made the point today—is to believe that the world that Beveridge described still exists. It clearly does not. In 1942, he wrote: By definition, the family is a group consisting of two parents … and their off-spring. In the next thirty years, housewives as mothers have vital work to do in ensuring the adequate continuance of the British race". The family that Beveridge described fits just 6 per cent. of British families today. His assumption that a woman's place was in the home of a two-parent family dependent on her husband's income is no longer a reality. Employment can no longer be classified in terms of full male employment. We no longer have men working 48 hours a week, 48 weeks of the year, 48 years of their life, because today half the work force are female. Men no longer monopolise the role of breadwinner.

We must accept that the reality of today's families has little to do with the cosy Pathé news vision of what the family looks like. It is our duty as politicians to face up to that new reality. We listened to the reforming zeal of the Secretary of State for Social Security, whose mind-set—if one wants a "Jurassic Park"—is back in the 1940s, at least. To live in a world, as he does, that bases social, economic and political judgments on Hovis and Ovaltine advertisements is a fantasy—a fantasy that no longer has a basis in policy.

Let us look at what we need. Many hon. Members have argued that we need answers to the difficulties that we are facing. One crucial aspect that needs to be changed is that we need to provide the right economic conditions for families to survive. The creation of economic wealth has to go hand in hand with social welfare. A stronger economy is not the only answer. We also need changes to work patterns.

We need work patterns and workplaces that allow both men and women to become family friendly. Everyone has a responsibility to help to achieve that. It would certainly make a difference to the House of Commons. If we had a family-friendly environment, the children of Members of Parliament would not be brought up by single parents—our partners. As most of us know, that is the reality. We need more flexi-time so that women and men can spend more time with their families and we must have a real commitment to maternity, paternity and parental leave.

We must also review the way that the benefits system means that women whose husbands become unemployed do better remaining on benefit than finding a pathway back to work. There must be incentives for people to return to work. There must be greater employment protection and opportunities for part-time workers. For most women, part-time work is a positive choice, but it carries with it low pay, low status, lack of training and the loss of pension rights and protection. If men are to be given the opportunity to be better fathers, we need to change working practices so that they, too, can spend more time caring for their children. We need a national child care strategy that makes that possible for both men and women.

Families are not just the responsibilities of parents. Everyone has rights and responsibilities and that includes the Government. After the innovation of their economic policy, which wrecks the economy, we have had an employment policy that fuels unemployment and an education policy that leaves children uneducated. It seems that we shall now experience the unhappy prospect of a welfare policy that seems designed only to undermine the welfare of our citizens.

9.46 pm
The Minister for Social Security and Disabled People (Mr. Nicholas Scott)

We have heard a wide-ranging and, at times, challenging debate—I suspect that it was as challenging for the Opposition as it has rightly been for the Government—as we have looked at the future pattern of social security.

It is timely that we are having the debate before the House rises for the summer recess. As the hon. Member for Redcar (Ms Mowlam) said, society is changing and the social security system needs a fundamental look at it from time to time to ensure that it is working with the grain of society as it exists, rather than being set in concrete.

I must say, in a fairly light-hearted manner, that some of the changes in working patterns mentioned by the hon. Lady have dangers as well. I remember a gentleman from the White House coming to see me to talk about home working, which is developing in the United States. He told me that they had found that a surprising result of men working in the house all day long was an increase in the incidence of the breakdown of marriage, and that they had to find ways to get men out of the house for much of the day so as to make the system work better.

We are dealing with a part of public policy concerned with the needs of people—retirement. sickness or disability, the misfortune of unemployment or family responsibilities. The social security system is designed to meet those needs. We must also look at the social security system from time to time, because of the massive cost to the taxpayer that the social security budget represents. It costs some £80 billion a year and that figure is rising, as my right hon. Friend the Secretary of State said.

The social security system, as it reacted to the changes in society that the hon. Member for Redcar mentioned, tended, rather Topsy-like, to grow. Every so often, we need to take a fundamental look at the pattern of social security provision. My hon. Friend the Member for Stamford and Spalding (Mr. Davies) spoke of how, within that growth, anomalies and disincentives creep into the pattern of social security provision which therefore needs to he reviewed.

We need a dispassionate, intelligent review of the system. I am delighted that the Labour party, floundering in our wake, has established the Commission on Social Justice. I am surprised that the party did not undertake the work itself but decided to privatise it, in spite of the commitment of the hon. Member for Redcar to opposing privatisation and contracting out wherever it takes place.

I agree with one sentence in particular in the document published by the Commission on Social Justice, which is that welfare is now top of the political agenda. I welcome that and I think that the House welcomes the fact that we are taking a close and penetrating look at the system. So far, the commission seems to have delivered a number of very elegant essays, but has not come up with any firm recommendations for the hon. Members for Glasgow. Garscadden (Mr. Dewar) and for Redcar to recommend. Firm recommendations seem a long way off. Our review is being addressed urgently, and we will not shrink from taking tough decisions if necessary.

All countries in the western world face the same problem. Much of today's debate has assumed that our society in these islands is considering social security problems in an isolated way. Europe. north America, Australia, New Zealand and all the advanced economies of the world are having to take a close and penetrating look at their social security systems, not least to see whether present generations and those to come can afford them. Some countries have already acted to constrain expenditure and others are plannning to do so. I do not believe that anyone can opt out of that challenge.

The Government welcome the idea of a debate and all the contributions to it, including, in due course, that of the Commission on Social Justice.

Some of the parameters that the Commission on Social Justice has established for itself fit in very well with the concepts set out in the Mais lecture by my right hon. Friend the Secretary of State. It recognises the importance of the link between economic and social policy. It recognises that changes in the economy and society since Beveridge have rendered some of the assumptions of Beveridge out of date and ready for review, as the hon. Member for Redcar recognised.

The commission also recognises the importance of more saving and investment and the need for people to have more control of their own resources, to enhance self-reliance and to help create future wealth. The commission recognises the need for better incentives to work and believes that people should meet their obligations to each other and be encouraged to insure themselves. So there is common ground, although one would not think so when one listened to the hon. Member for Garscadden opening the debate today. Clearly we can agree with those themes.

I differ from the Commission on Social Justice in its gloomy picture and analysis of Britain today, which is not a picture that I recognise. I believe that Opposition Members live in a world in which they—[interruption.] They believe that it is in their own interests to paint as bleak a picture as possible.

On page 48 of the document, the Commission on Social Justice says that we are wealthier, healthier, better educated and better housed today than we were 40 years ago. That is the reality of society today and has been increasingly true since 1979, when a Conservative Government came into office.

Mr. Dewar

Does the right hon. Gentleman take satisfaction from the fact that the Department of Trade and Industry's evidence to the Select Committee included a table of gross domestic product per head in 24 industrialised western countries in which we are 18th out of 24? Is that something from which we should take consolation?

Mr. Scott

I have about six minutes to draw the debate to a conclusion. The hon. Gentleman made that point in his opening speech. People know that they are better off now. They are becoming increasingly better off under a Conservative Government. We have won four successive general elections as a result of that policy and we are destined to win a fifth.

The right hon. Member for Chesterfield (Mr. Benn) made a remarkable speech, in which he reiterated his belief that state intervention and spending are all that are needed to cure all the social ills that beset our society. He declared—somewhat bravely—that he is still a socialist, an endangered species in the current Labour party. He asserted that, in 1979. the Government embarked on a deliberate policy of increasing unemployment to achieve certain political aims. I utterly refute any such suggestion.

Unemployment is evil and wasteful in human and economic terms. Our policies are designed to reduce it, and they are beginning to do that. We intend to continue to pursue those policies because they will lead to economic recovery and lower unemployment. I was somewhat surprised by the right hon. Gentleman's assertion that the increase in unemployment is the result of deliberate actions by the Government, because when he last held office, unemployment went up from 1.9 to 4.1 per cent. and he still felt able to remain a member of that Labour Government. It is easy to criticise us, but the right hon. Gentleman was in a Labour Cabinet when unemployment doubled.

I share the astonishment of my hon. Friend the Member for Chingford (Mr. Duncan Smith) at the picture of this country painted by Opposition Members. They have accused us of dismantling the welfare state, but we have increased welfare spending by 75 per cent. in real terms since 1979. There have been accusations that the rich are getting richer, but people know that the hallmark of Conservative government since 1979 has been the spreading of wealth and opportunities in ways that had never been used before.

We have given the opportunity of home ownership to some 2 million people who bought their council houses, and that was done in spite of Labour's consistent and sustained opposition. Share ownership has been taken up by 11 million people, again despite Labour's fierce opposition. Under this Government, the vast majority of people in Britain are better off now than they were in 1979. Household incomes have grown by 35 per cent. in real terms and pensions have fared even better. The growth in ownership of consumer durables has been faster than at any time in our history.

The true litmus paper test has been our electoral success, and that has been due to the success of our policies. The hon. Member for Garscadden said that life chances are being destroyed, but the contrary is true: they are being enhanced and broadened by our policies. Our record outdoes even the peroration of Opposition Members. The Labour party can scheme its schemes and the Liberals can dream their dreams, but we have work to do and we are determined to do it.

We want a successful economy and we are achieving it. We have no intention of dismantling the welfare state. We aim to make it better, to protect the vulnerable, to improve incentives to work and to cope with changes in our society. Above all, we aim to make sure that the pattern of social security is affordable for this generation and for generations to come. Every country is having to do that.

Labour's mismanagement of the economy in 1974–79 resulted in pensioners' incomes from savings falling by 16 per cent. in real terms. Under this Government, their income from savings has more than doubled. It is difficult to take lectures from a party which failed to pay the pensioners' Christmas bonus in 1975 and 1979.

We also find it difficult to take criticisms about means-tested benefits, when this Government made those benefits a statutory entitlement. Under the Labour Government, entitlement to those benefits was discretionary and rules for the exercise of that discretion were not even published. We aim to run a successful economy and a compassionate welfare system, and I commend the motion to the House.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 268, Noes 312.

Division No. 354] [10 pm
Abbott, Ms Diane Dewar, Donald
Adams, Mrs Irene Dixon, Don
Ainger, Nick Dobson, Frank
Ainsworth, Robert (Cov'try NE) Donohoe, Brian H.
Allen, Graham Dowd, Jim
Alton, David Dunnachie, Jimmy
Anderson, Donald (Swansea E) Dunwoody, Mrs Gwyneth
Anderson, Ms Janet (Ros'dale) Eagle, Ms Angela
Armstrong, Hilary Eastham, Ken
Ashdown, Rt Hon Paddy Enright, Derek
Ashton, Joe Etherington, Bill
Austin-Walker, John Evans, John (St Helens N)
Banks, Tony (Newham NW) Fatchett, Derek
Barnes, Harry Fisher, Mark
Barron, Kevin Flynn, Paul
Battle, John Foster, Rt Hon Derek
Bayley, Hugh Fraser. John
Beckett, Rt Hon Margaret Fyfe, Maria
Beggs, Roy Galloway, George
Bell, Stuart Gapes, Mike
Benn, Rt Hon Tony Garrett, John
Bennett, Andrew F. George, Bruce
Benton, Joe Gerrard, Neil
Bermingham, Gerald Gilbert, Rt Hon Dr John
Berry, Dr. Roger Godman, Dr Norman A.
Betts, Clive Godsiff, Roger
Blair, Tony Golding, Mrs Llin
Blunkett, David Gordon, Mildred
Boateng, Paul Gould, Bryan
Boyce, Jimmy Graham, Thomas
Boyes, Roland Grant, Bernie (Tottenham)
Bradley, Keith Griffiths, Nigel (Edinburgh S)
Bray, Dr Jeremy Griffiths, Win (Bridgend)
Brown, Gordon (Dunfermline E) Grocott, Bruce
Brown, N.(N'c'tle upon Tyne E) Gunnell, John
Bruce, Malcolm (Gordon) Hain, Peter
Burden, Richard Hall, Mike
Byers, Stephen Hanson, David
Caborn, Richard Hardy, Peter
Callaghan, Jim Harman, Ms Harriet
Campbell, Mrs Anne (C'bridge) Harvey, Nick
Campbell, Menzies (Fife NE) Hattersley, Rt Hon Roy
Campbell, Ronnie (Blyth V) Henderson, Doug
Campbell-Savours, D. N. Heppell, John
Canavan, Dennis Hill, Keith (Streatham)
Cann, Jamie Hinchliffe, David
Carlile, Alexander (Montgomry) Hoey, Kate
Chisholm, Malcolm Hogg, Norman (Cumbernauld)
Clapham, Michael Hood, Jimmy
Clark, Dr David (South Shields) Hoon, Geoffrey
Clarke, Eric (Midlothian) Howarth, George (Knowsley N)
Clarke, Tom (Monklands W) Howells, Dr. Kim (Pontypridd)
Clelland, David Hoyle, Doug
Clwyd, Mrs Ann Hughes, Kevin (Doncaster N)
Coffey, Ann Hughes Robert G.(Harrow W)
Cohen, Harry Hughes, Roy (Newport E)
Connarty, Michael Hughes, Simon (Southwark)
Cook, Frank (Stockton N) Hutton, John
Cook, Robin (Livingston) Illsley, Eric
Corbett, Robin Ingram, Adam
Corbyn, Jeremy Jackson, Glenda (H'stead)
Corston, Ms Jean Jackson, Helen (Shef'ld, H)
Cousins, Jim Jamieson, David
Cox, Tom Janner, Greville
Cryer, Bob Jones, Barry (Alyn and D'side)
Cummings, John Jones, Ieuan Wyn (Ynys Môn)
Cunliffe, Lawrence Jones, Lynne (B'ham S O)
Cunningham, Jim (Covy SE) Jones, Martyn (Clwyd, SW)
Cunningham, Rt Hon Dr John Jowell, Tessa
Dalyell, Tam Keen, Alan
Darling, Alistair Kennedy, Jane (Lpool Brdgn)
Davidson, Ian Khabra, Piara S.
Davies, Bryan (Oldham C'tral) Kilfoyle, Peter
Davies, Rt Hon Denzil (Llanelli) Kinnock, Rt Hon Neil (Islwyn)
Davies, Ron (Caerphilly) Leighton, Ron
Davis, Terry (B'ham, H'dge H'l) Lestor, Joan (Eccles)
Lewis, Terry Randall, Stuart
Litherland, Robert Raynsford, Nick
Livingstone, Ken Redmond, Martin
Lloyd, Tony (Stretford) Rendel, David
Loyden, Eddie Richardson, Jo
Lynne, Ms Liz Robertson, George (Hamilton)
McAllion, John Robinson, Geoffrey (Co'try NW)
McAvoy, Thomas Roche, Mrs. Barbara
McCartney, Ian Rogers, Allan
Macdonald, Calum Rooker, Jeff
McFall, John Rooney, Terry
McKelvey, William Ross, Ernie (Dundee W)
Mackinlay, Andrew Rowlands, Ted
McLeish, Henry Ruddock, Joan
Maclennan, Robert Sedgemore, Brian
McMaster, Gordon Sheerman, Barry
McNamara, Kevin Sheldon, Rt Hon Robert
McWilliam, John Shore, Rt Hon Peter
Madden, Max Short, Clare
Mahon, Alice Simpson, Alan
Mandelson, Peter Skinner, Dennis
Marek, Dr John Smith, Andrew (Oxford E)
Marshall, David (Shettleston) Smith, C.(Isl'ton S & F'sbury)
Marshall, Jim (Leicester, S) Smith, Rt Hon John (M'kl'ds E)
Martin, Michael J.(Springburn) Smith, Llew (Blaenau Gwent)
Martlew, Eric Snape, Peter
Meacher, Michael Soley, Clive
Meale, Alan Spearing, Nigel
Michie, Bill (Sheffield Heeley) Spellar, John
Michie, Mrs Ray (Argyll Bute) Steel, Rt Hon Sir David
Milburn, Alan Steinberg, Gerry
Miller, Andrew Stevenson, George
Moonie, Dr Lewis Stott, Roger
Morgan, Rhodri Strang, Dr. Gavin
Morley, Elliot Taylor, Mrs Ann (Dewsbury)
Morris, Rt Hon A.(Wy'nshawe) Taylor, Rt Hon John D.(Strgfd)
Morris, Estelle (B'ham Yardley) Taylor, Matthew (Truro)
Mowlam, Marjorie Thompson, Jack (Wansbeck)
Mudie, George Tipping, Paddy
Mullin, Chris Tyler, Paul
Murphy, Paul Vaz, Keith
Oakes, Rt Hon Gordon Walker, Rt Hon Sir Harold
O'Brien, Michael (N W'kshire) Walley, Joan
O'Brien, William (Normanton) Wardell, Gareth (Gower)
O'Hara, Edward Wareing. Robert N
Olner, William Watson, Mike
Orme, Rt Hon Stanley Wicks, Malcolm
Patchett, Terry Williams, Rt Hon Alan (Sw'n W)
Pendry, Tom Williams, Alan W (Carmarthen)
Pickthall, Colin Wilson, Brian
Pike, Peter L. Winnick, David
Pope, Greg Wise, Audrey
Powell, Ray (Ogmore) Worthington, Tony
Prentice, Ms Bridget (Lew'm E) Wray, Jimmy
Prentice, Gordon (Pendle) Wright, Dr Tony
Prescott, John Young, David (Bolton SE)
Primarolo, Dawn
Purchase, Ken Tellers for the Ayes:
Quin, Ms Joyce Mr. Jon Owen Jones and Mr. Dennis Turner.
Radice, Giles
Ainsworth, Peter (East Surrey) Bates, Michael
Aitken, Jonathan Batiste, Spencer
Alexander, Richard Bellingham, Henry
Alison, Rt Hon Michael (Selby) Bendall, Vivian
Allason, Rupert (Torbay) Beresford, Sir Paul
Amess, David Biffen, Rt Hon John
Arbuthnot, James Blackburn, Dr John G.
Arnold, Jacques (Gravesham) Body, Sir Richard
Arnold, Sir Thomas (Hazel Grv) Bonsor, Sir Nicholas
Ashby, David Booth, Hartley
Aspinwall, Jack Boswell, Tim
Atkinson, David (Bour'mouth E) Bottomley, Peter (Eltham)
Atkinson, Peter (Hexham) Bottomley, Rt Hon Virginia
Baker, Rt Hon K.(Mole Valley) Bowden, Andrew
Baker, Nicholas (Dorset North) Bowis, John
Baldry, Tony Boyson, Rt Hon Sir Rhodes
Banks, Matthew (Southport) Brandreth, Gyles
Banks, Robert (Harrogate) Brazier, Julian
Bright, Graham Gorst, John
Brooke. Rt Hon Peter Grant, Sir Anthony (Cambs SW)
Brown, M.(Brigg & Cl'thorpes) Greenway, Harry (Ealing N)
Browning, Mrs. Angela Greenway, John (Ryedale)
Bruce, Ian (S Dorset) Griffiths, Peter (Portsmouth, N)
Budgen, Nicholas Grylls, Sir Michael
Burns, Simon Hague, William
Burt, Alistair Hamilton, Rt Hon Archie (Epsom)
Butcher, John Hamilton, Neil (Tatton)
Butler, Peter Hampson, Dr Keith
Carlisle, John (Luton North) Hanley, Jeremy
Carlisle, Kenneth (Lincoln) Hannam, Sir John
Carrington, Matthew Hargreaves, Andrew
Carttiss, Michael Harris, David
Cash, William Haselhurst, Alan
Channon, Rt Hon Paul Hawkins, Nick
Churchill, Mr Hawksley, Warren
Clappison, James Hayes, Jerry
Clark, Dr Michael (Rochford) Heald, Oliver
Clarke, Rt Hon Kenneth (Ruclif) Heath, Rt Hon Sir Edward
Clifton-Brown, Geoffrey Heathcoat-Amory, David
Coe, Sebastian Hendry, Charles
Colvin, Michael Hicks, Robert
Congdon, David Higgins, Rt Hon Sir Terence L.
Conway, Derek Hill, James (Southampton Test)
Coombs, Anthony (Wyre For'st) Horam, John
Coombs, Simon (Swindon) Hordern, Rt Hon Sir Peter
Cope, Rt Hon Sir John Howard, Rt Hon Michael
Couchman, James Howarth, Alan (Strat'rd-on-A)
Cran, James Howell, Rt Hon David (G'dford)
Currie, Mrs Edwina (S D'by'ire) Howell, Sir Ralph (N Norfolk)
Curry, David (Skipton & Ripon) Hughes Robert G.(Harrow W)
Davies, Quentin (Stamford) Hunt, Rt Hon David (Wirral W)
Davis, David (Boothferry) Hunt, Sir John (Ravensbourne)
Day, Stephen Hunter, Andrew
Deva, Nirj Joseph Hurd, Rt Hon Douglas
Devlin, Tim Jack, Michael
Dickens, Geoffrey Jackson, Robert (Wantage)
Dicks, Terry Jenkin, Bernard
Dorrell, Stephen Jessel, Toby
Douglas-Hamilton, Lord James Johnson Smith, Sir Geoffrey
Dover, Den Jones, Robert B.(W Hertfdshr)
Duncan, Alan Jopling, Rt Hon Michael
Duncan-Smith, Iain Kellett-Bowman, Dame Elaine
Dunn, Bob Key, Robert
Durant, Sir Anthony Kilfedder, Sir James
Dykes, Hugh King, Rt Hon Tom
Eggar, Tim Kirkhope, Timothy
Elletson, Harold Knapman, Roger
Emery, Rt Hon Sir Peter Knight, Mrs Angela (Erewash)
Evans, David (Welwyn Hatfield) Knight, Greg (Derby N)
Evans, Jonathan (Brecon) Knight, Dame Jill (Bir'm E'st'n)
Evans, Nigel (Ribble Valley) Knox, Sir David
Evans, Roger (Monmouth) Kynoch, George (Kincardine)
Evennett, David Lait, Mrs Jacqui
Faber, David Lang, Rt Hon Ian
Fabricant, Michael Lawrence, Sir Ivan
Fenner, Dame Peggy Legg, Barry
Field, Barry (Isle of Wight) Leigh, Edward
Fishburn, Dudley Lennox-Boyd, Mark
Forman, Nigel Lester, Jim (Broxtowe)
Forsyth, Michael (Stirling) Lidington, David
Forth, Eric Lilley, Rt Hon Peter
Fowler, Rt Hon Sir Norman Lloyd, Peter (Fareham)
Fox, Dr Liam (Woodspring) Lord, Michael
Fox, Sir Marcus (Shipley) Luff, Peter
Freeman, Rt Hon Roger Lyell, Rt Hon Sir Nicholas
French, Douglas MacGregor, Rt Hon John
Fry, Peter MacKay, Andrew
Gale, Roger Maclean, David
Gallie Phil McLoughlin, Patrick
Gardiner, Sir George McNair-Wilson, Sir Patrick
Garel-Jones, Rt Hon Tristan Madel, David
Garnier, Edward Maitland, Lady Olga
Gill, Christopher Major, Rt Hon John
Gillan, Cheryl Malone, Gerald
Goodlad, Rt Hon Alastair Mans, Keith
Goodson-Wickes, Dr Charles Marland, Paul
Gorman, Mrs Teresa Marlow, Tony
Marshall, John (Hendon S) Soames, Nicholas
Marshall, Sir Michael (Arundel) Spencer, Sir Derek
Martin, David (Portsmouth S) Spicer, Sir James (W Dorset)
Mates, Michael Spicer, Michael (S Worcs)
Mellor, Rt Hon David Spink, Dr Robert
Merchant, Piers Spring, Richard
Milligan, Stephen Sproat, Iain
Mills, Iain Squire, Robin (Hornchurch)
Mitchell, Andrew (Gedling) Stanley, Rt Hon Sir John
Mitchell, Sir David (Hants NW) Steen, Anthony
Moate, Sir Roger Stephen, Michael
Monro, Sir Hector Stern, Michael
Montgomery, Sir Fergus Stewart, Allan
Moss, Malcolm Streeter, Gary
Nelson, Anthony Sumberg, David
Neubert, Sir Michael Sweeney, Walter
Newton, Rt Hon Tony Sykes, John
Nicholls, Patrick Tapsell, Sir Peter
Nicholson, David (Taunton) Taylor, Ian (Esher)
Nicholson, Emma (Devon West) Taylor, John M.(Solihull)
Norris, Steve Taylor, Sir Teddy (Southend, E)
Onslow, Rt Hon Sir Cranley Temple-Morris, Peter
Oppenheim, Phillip Thomason, Roy
Ottaway, Richard Thompson, Sir Donald (C'er V)
Page, Richard Thompson, Patrick (Norwich N)
Paice, James Thornton, Sir Malcolm
Patnick, Irvine Thurnham, Peter
Pattie, Rt Hon Sir Geoffrey Townend, John (Bridlington)
Pawsey, James Townsend, Cyril D.(Bexl'yh'th)
Peacock, Mrs Elizabeth Tracey, Richard
Pickles, Eric Tredinnick, David
Porter, Barry (Wirral S) Trend, Michael
Porter, David (Waveney) Trotter, Neville
Portillo, Rt Hon Michael Twinn, Dr Ian
Powell, William (Corby) Vaughan, Sir Gerard
Rathbone, Tim Viggers, Peter
Redwood, Rt Hon John Waldegrave, Rt Hon William
Renton, Rt Hon Tim Walden, George
Richards, Rod Waller, Gary
Riddick, Graham Ward, John
Robathan, Andrew Wardle, Charles (Bexhill)
Roberts, Rt Hon Sir Wyn Waterson, Nigel
Robertson, Raymond (Ab'd'n S) Watts, John
Robinson, Mark (Somerton) Wells, Bowen
Roe, Mrs Marion (Broxbourne) Whitney, Ray
Rowe, Andrew (Mid Kent) Whittingdale, John
Rumbold, Rt Hon Dame Angela Widdecombe, Ann
Ryder, Rt Hon Richard Wiggin, Sir Jerry
Sackville, Tom Wilkinson, John
Sainsbury, Rt Hon Tim Willetts, David
Scott, Rt Hon Nicholas Wilshire, David
Shaw, David (Dover) Winterton, Mrs Ann (Congleton)
Shaw, Sir Giles (Pudsey) Winterton, Nicholas (Macc'f'ld)
Shephard, Rt Hon Gillian Wolfson, Mark
Shepherd, Colin (Hereford) Wood, Timothy
Shepherd, Richard (Aldridge) Yeo, Tim
Shersby, Michael Young, Rt Hon Sir George
Sims, Roger
Skeet, Sir Trevor Tellers for the Noes:
Smith, Sir Dudley (Warwick) Mr. Sydney Chapman and Mr. David Lightbown.
Smith, Tim (Beaconsfield)

Question, accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments) and agreed to.

Question accordingly agreed to.

MADAM SPEAKER forthwith declared the main Question, as amended, to be agreed to.


That this House supports the Government's approach to the reform of social security, which is designed to improve the system, protect the vulnerable and prevent spending outstripping the nation's ability to pay; and deplores the scaremongering tactics of the Opposition, who cause unnecessary alarm to the least well off, elderly and disabled people, yet fail to produce responsible alternative policies.

Forward to