§ 1. Mr. Bayley
To ask the Chancellor of the Exchequer what areas of welfare spending he has excluded from his review of public expenditure.
§ The Chief Secretary to the Treasury (Mr. Michael Portillo)
The Government are conducting a long-term review of public expenditure starting with the Department of Social Security, Department of Health, Department for Education and the Home Office.The Government have a duty to examine all areas of public spending to ensure that they give value for money. We would be failing in our duty if any area were to be exempt from scrutiny. The reviews will produce interim results that will be helpful in this year's public expenditure survey.
§ Mr. Bayley
Millions of people are concerned about the review and the Government should set out its terms of 976 reference and scope. Given the Chief Secretary's meeting with the Prime Minister to rewrite invalidity benefit, will he confirm that the Government intend to excludethose who suffer from progressive diseases—for example, multiple sclerosis—and heart patients who are unable to walk on the flat for 200 yards"?Before I am accused of scaremongering, I may say that that is a direct quote from the Department of Social Security document prepared for that meeting. Will the Chief Secretary explain what other cuts he intends to make to meet the £5,000 million target set for the DSS that is mentioned in that same document?
§ Mr. Portillo
The hon. Gentleman knows that the Government are on all fours with the Opposition. The right hon. and learned Gentleman the Leader of the Opposition said:I set up the Social Justice Commission to conduct a very wide-ranging view of the … complex system of tax, benefits and rights … We have not looked at any of this, almost since Beveridge.That is what the Government are doing. We are examining the way in which we provide value for money through the system. As to invalidity benefit, the hon. Gentleman knows that that must be looked at. There has been a massive increase in the number of claimants for invalidity benefit at a time when the health of the nation has been improving. That benefit now costs £6.2 billion a year. No decisions have been taken—in fact, no firm proposals have yet been put to Ministers. It is of course of great importance to us to ensure that the vulnerable are protected.
§ Ms Lynne
Now that the Chancellor has ruled out prescription charges for pensioners and charging for hospital beds, will he improve his left-wing credentials further by ruling out additional cuts in invalidity benefit and prescription charges in respect of children who are just above income support level? Or does the Chief Secretary feel that the Chancellor will be a little too worried about his own political advancement if the right wing of the Conservative party disapproved?
§ Mr. Portillo
The hon. Lady does not help the debate by trivialising it. We obviously have to address the question of social security spending rising faster than our national income, which presents us with a problem. We must examine the benefits that are growing fastest and ask ourselves why benefits are rising 3 per cent. a year in real terms, which is much faster than national income. We must take careful decisions. There will be no announcements before November, and it will be later than that, in respect of long-term questions, before we can reach decisions, because those serious matters need careful consideration.
§ Mr. John Townend
When my right hon. and learned Friend reviews public expenditure, will he bear in mind that every firm in the country that has survived during the recession—small, medium or large—has had to cut its overheads and slim down its staff? Meanwhile, the public sector and local government are still bloated. In the last year, we have increased the strength of the civil service by 2.5 per cent.—nearly 14,000 people. When he looks for savings, will my right hon. Friend set all Departments a target of a 5 per cent. reduction in manpower to cut the Government's overheads?
§ Mr. Portillo
My hon. Friend has made an important point. In examining Government spending, all we are really doing is ensuring that the public sector does what the private sector has had to do throughout the recession—make sure that it lives within its means. The same applies to every family in the country. It would be intolerable if people made sacrifices, while the Government continued to live beyond their means on the back of borrowing and taxation which are available to them but not to families and businesses.
We need to consider civil service numbers and running costs very carefully. The civil service had quite a tight settlement last year, and I imagine that next year's figures may show the lowest number since the war. I think that that is quite appropriate.
§ Mr. Jessel
We all greatly admire the excellent work of the national health service, but will my right hon. Friend invite the Secretary of State for Health to consider whether she should continue to provide surgical operations on the NHS for the removal of tattoos? If a person has had printed on his skin signs, symbols, messages and coloured pictures—
§ Madam Speaker
Order. I have the impression that the hon. Gentleman's question might be better put to the Secretary of State for Health herself. The Chief Secretary has probably got the point by now.
§ Mr. Portillo
I thought my hon. Friend's question very valuable. It is now etched indelibly on my mind.
§ Mr. Gordon Brown
Now that the Cabinet has met to discuss public spending, why does not the Chief Secretary use this opportunity to rule out cuts in invalidity benefit for those suffering from multiple sclerosis, and the heart patients who cannot walk 200 yards? Why does he not tell us that he will drop his proposal to privatise some national insurance benefits, and that anything other than full compensation for pensioners and others on low income who have been hit by VAT rises will not be enough? Why must the users of public services pay the price of the Government's economic mismanagement?
§ Mr. Portillo
I wonder why the hon. Gentleman does not use his own opportunity to desist from scaremonger-ing. Is he not aware of the real anxiety and fear that he causes? Is he not aware of the disrepute in which he is now held because of the disgraceful tactics that he has used, day after day? Is he not aware that the British people are now pretty well fed up with him, and that he should stop?
§ Mr. Congdon
Does my right hon. Friend agree that, although it is important to review all aspects of public expenditure, many people are rightly concerned about the growth in the expenditure of the Department of Social Security? They expect the Government to review all the various benefits properly, and to ensure that they are targeted. At the same time, members of the public wish us to ensure that NHS expenditure is protected.
§ Mr. Portillo
My hon. Friend's comments are very valuable. They come as a breath of fresh air after the question from the hon. Member for Dunfermline, East (Mr. Brown): I am very grateful.