Pensions and Benefits

HC Deb 16 February 1994 vol 237 cc984-1040 5.54 pm

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

I beg to move, That the draft Guaranteed Minimum Pensions Increase Order 1994, which was laid before this House on 10th February be approved.

Mr. Deputy Speaker (Mr. Michael Morris)

I understand that it will be convenient for the House to discuss at the same time the following motions: That the draft Social Security Benefits Up-rating Order 1994, which was laid before this House on 10th February, be approved. That the draft Statutory Sick Pay (Small Employers' Relief) Amendment Regulations 1994, which were laid before this House on 10th February be approved. That the draft Social Security (Contributions) (Re-rating and National Insurance Fund Payments) Order 1994, which was laid before this House on 10th February, be approved. That the draft Statutory Sick Pay (Rate of Payment) Order 1994, which was laid before this House on 10th February, be approved.

Mr. Lilley

As a result of the orders, social security will cost more than £83 billion in 1994–95. It will rise to £88 billion in the next year and £92 billion the year after. That huge increase demonstrates both the need to reform our system, to make it affordable in the long term, and our commitment to maintaining a decent level of social security.

We have met our commitment to uprate benefits, fulfilled out pledge to provide extra help for those most affected by the imposition of value added tax on fuel and are improving the benefits system for mothers who want to return to work.

As I announced to this House in December, to provide merely for a full uprating of all benefits next year will cost £2 billion, but I have gone beyond that. Despite a very difficult public spending round, I have also provided a very generous package of extra help—over and above the normal uprating—towards VAT on fuel. That will help more than 15 million people in the coming year.

The package of extra help with VAT on fuel will cost an extra £400 million this year alone. Over three years, the cost will be £2.5 billion. In practice, it means that people on income support will have an increase of 3.9 per cent. from April. A further 2 million people above income support levels, who receive housing benefit and family credit, will receive similar increases.

However, I also wanted to help those who have worked, saved and earned modest pensions, who often get no extra help. So single pensioners will get an extra 50p a week and couples will get an extra 70p this year. That is on top of the £1 and £1.60 rises in the full basic pension in line with the retail prices index.

Next year the extra amount for VAT will be worth £1 for a single pensioner and £1.40 for couples and, in the third year, it will be as much as £1.40 for single people and £2 for couples.

The increases for VAT will also apply to people on widows' benefits, invalidity benefit, severe disablement allowance and the disability premium. Those increases are permanent. In seven weeks' time people will begin to receive the extra money with their benefit—as we promised—before the higher fuel bills arrive. In addition, I am increasing cold weather payments from £6 to £7 in November, and by a further 50p from November 1995.

To help those people with higher than average heating costs, we are making a further £35 million available through the home energy efficiency scheme. From April 1994, all pensioners and disabled people not on income-related benefits will be eligible for grants from the scheme to insulate their homes and make them more energy efficient. More than 200,000 extra households will be eligible for such grants next year.

By any standards, that is a very substantial package of help. It is far higher than almost anyone expected. We have certainly done rather better than the 50p that the hon. Member for Glasgow, Garscadden (Mr. Dewar) told The People newspaper he thought was enough.

Spending on benefits continues to grow in real terms. Since 1979 it has grown at an underlying rate of 3 per cent. a year—excluding expenditure on the unemployed. Underlying growth is expected to exceed 3 per cent. a year in real terms until the end of the century. Thereafter there will be even more pressure as we enter the next century and the number of pensioners begins to rise. On behalf of every working person every working day, we are spending £15 just to finance the social security system. It is vital to the future of social security that we keep within the limit of what we can afford. My priority is to make savings that do not have a direct effect on benefit entitlements. That means bearing down on operational costs, which will be kept within last year's limit, even with an increased work load. It means carrying forward the battle against fraud.

Benefit money should go only to those whom Parliament intended to help, not to those who abuse the system. Social security fraud hurts: it means less money for the people who need it. Last year, we set up a new strategic board to look at fraud. The hon. Member for Garscadden welcomed its announcement in December. The board is chaired by my noble Friend the Under-Secretary of State for Social Security. He reports excellent progress. We have redesigned the order book to prevent forgery; introduced secure delivery methods to prevent theft; and are rewarding vigilant Post Office Counters employees who stop false encashment. Last year, the Benefits Agency's investigators saved more than half a billion pounds. I fully expect them to do better this year.

I am also stopping a number of abuses. For example, I will discourage local authorities from paying housing benefit on unnecessarily expensive properties. I have introduced legislation to prevent employers from avoiding national insurance liability by paying their employees in commodities such as gold bullion. We are tightening up on the availability of safety net benefits—a practice which I believe is favoured by Labour party supporters—for various foreign nationals who are looking for work in this country.

United Kingdom citizens would not be entitled to the equivalent of income support and housing benefit if they were looking for work in other countries of the European economic area. In most of those countries, some form of residence test is applied. I propose to bring our rules more in line with theirs by introducing a residence test requirement here, too. It cannot be right to leave our social security system open to benefit tourism.

Mr. Donald Dewar (Glasgow, Garscadden)

On the expected savings, will the Secretary of State quantify his attack on benefit tourism? What exactly will the proceeds be? Will he say a word or two about the citizens of the Irish Republic and how they will fit into this framework?

Mr. Lilley

We do not have records of how many foreign people who would be affected by the rules are currently claiming benefit other than the Home Office record that some 5,000 are claiming income support. That may well be incomplete. We have no records of those claiming housing benefit. We cannot put a figure on it. Clearly it is a growing problem. By stopping it now, the potential savings are equal to the size of the growth that would have occurred had we not taken this action. I am glad that it was welcomed by the hon. Gentleman when it was announced.

As to the impact on citizens of the Irish Republic, we will not of course discriminate through the measure between any citizens of the European Community, but, typically, they are more likely to have habitual residence both in this country and their own country and therefore pass the test. It is mistaken to assume that Irish people typically come to this country to claim benefit. By and large, they come here to work.

Mr. Dewar

I was not suggesting that.

Mr. Lilley

I was not saying that the hon. Gentleman was making that suggestion, but if anyone were to make that assumption—as some people do—they would probably be wrong.

Mr. Adam Ingram (East Kilbride)

He was thinking it.

Mr. Lilley

Perhaps I was reading the hon. Gentleman's mind.

A further problem is those who enter this country on the express condition that they will not be a burden on the public purse, yet subsequently find ways of claiming benefit. I have already stopped the payment of income support to people who are supposed to be self-supporting or who are here illegally. The same will apply to housing benefit and council tax benefit from April 1994. Proposals are with the Social Security Advisory Committee for consultation. Those changes will enable us to concentrate our resources on those who have paid their contributions and taxes and intend to pay their own way in future by finding work.

In July last year, I published an analysis of the growth of social security. It indicated that one of the main sources of growth in claimants and expenditure up to the end of the century would be invalidity and related benefits. That is why I am making a fundamental reform of those benefits. Our reforms to statutory sick pay will return responsibility for levels of sick absence to employers. I am improving the structure of statutory sick pay and giving extra support for small employers. At the same time, I am reducing employers' national insurance contributions. That will more than compensate for the increased costs on statutory sick pay.

Overall, as a result of the orders today, employers' net costs will be reduced by more than £100 million a year. Those employers who accept the challenge to improve their sick absence records will benefit even more.

The number on invalidity benefit has more than doubled over 10 years, and trebled over 15. Yet every other source of information indicates that the health of the nation has been improving. If left unchecked, expenditure on invalidity benefit looks likely to increase by a further 50 per cent. in real terms by the end of the century. The new incapacity benefit will focus help on those medically incapable of work—the people for whom it was always intended—through a new, more objective test-of incapacity for work. I am also making a number of structural changes to the benefit so that those incapable of work will continue to receive a basic level of income, as of right, regardless of means.

The net effect of these changes will be not to reduce help to the sick and disabled, but only to curb the growth of expenditure. In future, we would expect to spend as much in real terms as those who, in the absence of changes, would have received invalidity benefit as we do now. In addition, people on incapacity benefit will be able to undertake up to 16 hours' voluntary work a week without it affecting their benefit. People receiving disability working allowance will qualify automatically for free prescriptions and dental treatment.

I am increasing the level of support for Motability, which provides help with mobility for more than 170,000 disabled people. I am increasing by £1 million the grant to the mobility equipment fund, which adapts vehicles for severely disabled people.

This is a fundamental set of reforms to benefits for sick and disabled people. Altogether, my package represents a very substantial improvement in the structure of benefits for short and long-term sickness and disability. Employers will be encouraged to take direct responsibility for improving the health, motivation and monitoring of their employees. Benefits will be concentrated on those genuinely unable to work. The spiralling costs of benefits will be contained to the gain of all taxpayers and the ultimate good of the welfare state.

The next stage in my sector-by-sector reform is arrangements for the unemployed. At present we have two benefits with conflicting sets of rules, separate delivery systems and different levels of entitlement. That is contradictory, confusing and unnecessarily complex. We propose to replace them by a single new job seeker's allowance with a contributory and a means-tested element. At the same time, we will place a greater emphasis on helping people back to work.

Under the new proposals, we are strengthening the links between job search and benefit. At the start of their claim, unemployed people will be required to enter into an agreement on how they will set about seeking work. That agreement will not just be a form of words, but a commitment to a course of action that is relevant and beneficial to the individual and his or her circumstances. It will provide the claimant with a positive plan for getting back into work.

We are looking at ways of giving extra help to those who make the effort to find a job. We recognise that going back to work can involve extra costs, for example, for clothing and transport, which may be hard to meet after a long period out of work. The Employment Service, therefore, is piloting a job finder's grant of up to £200 for people who have not had a job for two years.

We are making further changes that will benefit unemployed people who want to help themselves and who find work. At present, unemployed people whose partners work for 16 hours or more a week are excluded from income support. That is a by-product of a beneficial change to the family credit rules, but it can work as a disincentive to families on income support. We will therefore be restoring the limit for partners of people on job seeker's allowance to 24 hours.

I am also pleased to be able to offer further, very substantial practical help to people with family responsibilities who want to work. Giving up benefit in favour of a low-paid job can be an unattractive proposition, especially if it involves child care costs. Therefore, I propose from October 1994 to enable families with a child under the age of 11 to offset up to £40 a week of child care costs against their earnings before those earnings are taken into account against benefit. Families on family credit will therefore be up to £28 a week better off. That will help up to 150,000 families, and we expect 50,000 people to take up work as a direct result of that measure.

Another major change announced in the social security statement was the equalisation of the state pension age. We will probably see scarcely any growth in the number of pensioners over the next decade or two. Thereafter, however, there will be nearly a 50 per cent. increase in subsequent decades. Given that the basic state pension amounts to more than a third of the social security budget, the potential impact of those extra pensioners on Department of Social Security spending is enormous. That is one inescapable reason for equalising at the age of 65 and for phasing in the new arrangements between 2010 and 2020.

To have equalised the state pension age at 60 would cost some £12 billion a year more than our proposals. Yet that appears to be what the Labour party is recklessly committed to spend. On 26 January I wrote to the hon. Member for Garscadden and reminded him that last year's Labour party conference passed a motion calling for the equalisation of state pensions at 60. The Labour manifesto likewise pledged to allow men and women to draw full pension at 60. Yet the hon. Member for Dunfermline, East (Mr. Brown) said on 26 January that Labour has no commitment to equalisation of the pension age at a certain age". I have received no answer or clarification from the hon. Member for Garscadden. I will happily give way to him if he would like to tell the House whether the Labour party is committed to £12 billion a year extra spending. Or are Labour party promises made outside the House not worth the paper they are written on, as the hon. Member for Dunfermline, East cynically assures us? We must assume from the silence of the hon. Member for Garscadden that the Opposition's words outside the House are simply not to be believed, trusted or taken into account.

Mr. Bernard Jenkin (Colchester, North)

May I point out to my right hon. Friend that some countries have felt constrained to equalise the state retirement age at 67? We are still better off than a number of countries because of the prudent way in which we plan our social security and retirement systems.

Mr. Deputy Speaker

Order. I am having some difficulty in seeing how this part of the Secretary of State's speech about state pension age and its correlation comes within the terms of the orders. Perhaps I am unable to fathom that quickly.

Mr. Lilley

I take your point, Mr. Deputy Speaker. They are all inextricably entwined in the social security statement, but I felt that you would not like me to unravel them at this stage.

With your permission, Mr. Deputy Speaker, I should like to elaborate on a specific and non-partisan point, which will be of interest to the House and the country. At the same time as equalising the pension age, we want to ensure that women have more equal pension entitlement. One factor which makes it difficult for many women to earn full entitlement is that they are not earning while bringing up children or caring for relatives.

We already compensate for that by the home responsibilities protection system, which makes allowance for years out of the labour market by enabling women to build up full entitlement to the basic pension in as few as 20 working years. We plan to extend that to SERPS. That will be immensely valuable to women, and to a few men who are in a similar position. It will enhance women's pensions rights by some £2 billion a year by 2020.

Over the past year, I have endeavoured to stimulate an informed public debate, as I have by the orders. I have been as open as any Minister could be in thinking out loud about our long-term approach to social security reform. I have spelled out long-term approach to social security reform. I have spelled out our principles; I have discussed our methodology; I have published our analyses of past spending and projected future growth in spending and dependence; I have collated overseas experience; I have issued our plans for the first sectoral reforms and indicated our likely legislation a year or so ahead.

All this has indeed stimulated a welcome, lively and constructive public debate. Academics, think tanks, newspapers and commentators have joined in—everyone except, alas, Her Majesty's loyal Opposition. They have been conspicuous by their silence.

The Commission for Social Justice—whose formation I welcomed—has not yet made any concrete contribution. Fearing it might eventually do so, the Leader of the Opposition has now gone to the length, as we are informed by the newspapers, of setting up a separate policy body to take direct control of social security policy and presumably to shut the commission up.

Since policy has been shunted into those bodies, the poor hon. Member for Garscadden—though theoretically his party's spokesman on social security—has been completely silenced. His role is like nothing so much as a mime artist on the radio: the Marcel Marceau of the social security debate. We urge him, on this occasion, when he has plenty of time and an eager House waiting to hear his words—[HON. MEMBERS: "Hear, hear"]—to let us know his thinking and what his policies would be. We want to know what his party would spend and how it would reform benefits and contribute to the great national debate on the reform of the social security system so that we may have a better welfare state in the next century.

I believe that the orders will be widely welcomed. Our reforms have the backing of most thinking people and we are on track to build a better welfare system for the future. I commend the orders to the House.

6.16 pm

Mr. Donald Dewar (Glasgow, Garscadden)

I must confess to the Secretary of State that there is a certain predictability about such debates. I had the advantage, or should I say I took the precaution, of re-reading what he said last year. The right hon. Gentleman's speech therefore contained few surprises.

I accept that I have time to speak at great length, if I were so minded, but I am not sure that the audience is one that I find attractive. It looks a little like the "Muppet Show" at the moment, possibly because the hon. Member for Havant (Mr. Willetts), among others, is present. I am glad to respond to some of the points that the right hon. Gentleman made.

This is a ritual debate in the sense that it is an annual outing. The right hon. Gentleman has gone through the niceties of etiquette and it is usual for him to restate what he has already told us in the uprating statement. Some parts of the right hon. Gentleman's speech were almost word perfect, if my memory serves me correctly.

It is also an occasion on which the right hon. Gentleman appears before us in the role of the eminently reasonable man. He likes to parade the uprating benefit, particularly when it is in line with prices, like a trophy. We are invited, collectively to say, "The lad has done good." I must tell the right hon. Gentleman that I do not believe that the entire House will be willing to do that today and it is certainly not something which the country would be willing to do.

I accept that expenditure on social security is formidable and that it is growing. I am not sure that that demonstrates any commitment by the right hon. Gentleman to retain what he was pleased to call a "decent level" of benefit. It certainly underlines the price that we have been paying for recession and high unemployment. One of my colleagues has told me that that can be calculated at about £20 per week per household. That is simply the cost of financing and paying for the long dole queues.

Although I suspect that the rate of unemployment will continue to fluctuate, one of the really depressing factors to emerge from the figures published today is that the number of long-term unemployed has gone up greatly in recent times. It looks as though that problem will not be easy to solve.

Mr. Jenkin

Taking into account all those factors, particularly what we now call cyclical social security, are we spending enough?

Mr. Dewar

We are spending a great deal in the wrong way. I am quite sure that the hon. Gentleman, whom I welcome as a scarred veteran of Glasgow politics of recent years, by his use of the word "cyclical" is conceding that it is a product of the recession. Some of us would argue, however, that it is the result of the mismanagement of the economy. None of us likes bills to go up for that reason.

If we were in a position to do it, I am sure that the hon. Gentleman at least would want the general standard of protection in society to improve. It has not been possible, not because of demographic factors—those are some years away, as the Minister pointed out—but because Britain has failed to achieve a reasonable economic performance in the past decade. That must rest on the hon. Gentleman's conscience as an active Conservative and a supporter of the Government, as it should on the conscience of the Secretary of State.

Today, we have the essential minimum. The Minister has uprated benefits according to the RPI, where appropriate, or the Rossi index. He has added in a certain amount partially to compensate for the imposition of VAT on domestic fuel.

Mr. Jim Cunningham (Coventry, South-East)

Does my hon. Friend agree that, despite the Secretary of State's announcement, the increases will not compensate old-age pensioners and one-parent families, who will suffer as a result of the increased scope of VAT?

Mr. Dewar

There is no argument about that. The Secretary of State seems determined to make me famous and perhaps I should be flattered, but, as so often happens, the fame is ill earned. As he knows, there is no way that the construction he seeks to put on what I said can properly be put on it. I make that point in passing, but I agree entirely with my hon. Friend.

On this non-partisan occasion, I am minded to be charitable, but the best I can do is say that it is a partial and inadequate rebate for what most people consider an offensive and regressive form of taxation. It will leave many important groups in society at a considerable disadvantage.

I was in Aberdeen at the weekend; it is a good place to contemplate severe weather. I was attending a public meeting there and it was drawn to my attention forcefully and in a sensible way that the imposition of VAT on domestic fuel will strike at certain groups who can ill bear an additional burden—we think immediately of the infirm and pensioners living in poverty, but we often forget people on low incomes with young families who find it particularly difficult to cope.

There is another problem of which at least one Conservative Member is aware. The imposition of VAT on domestic fuel represents an erosion of zero rating in a way that makes the whole VAT system much more regressive.

I shall not pursue the argument at great length, but it is worth reminding the Minister that at the time of the big hike in VAT, when Ministers were throwing money at the problems of the poll tax, we were told that we did not need to worry, and that VAT was not regressive as vital areas of expenditure for low-income families were zero-rated. It is unfortunate that the Minister offered no adequate compensation in the uprating statements; it means that the problem will get worse.

Mr. Lilley

Is the hon. Gentleman not aware that it his own party's commitment, both unilaterally and by its signing of the European socialist manifesto, to transfer greater powers from the House to the European Community in the setting of our taxes? If we applied that to VAT, there is absolutely no doubt that the Community and Commission would seek to remove entirely the zero rating. For him to regret the potential demise of zero rating—something we have no intention of permitting—is pretty extraordinary when his party would hand over powers that would ensure its end.

Mr. Dewar

One of the pleasant things about debating with the Secretary of State is that he never loses his ability to astonish me. The zero-rated areas, where they existed, were retained until 1996 by agreement with the British Government and the European Union. There would then have been further discussion. No one seriously believes that it would not have been possible to retain them. However, if we unilaterally withdraw them, of course there will be no prospect whatsoever of retaining them.

I know—and I pay tribute to it—no one in British politics more genuinely and passionately opposed to everything that European Union stands for than the Secretary of State for Social Security. I have heard him out loose in the country giving speeches to student audiences, and although I thought his views were perverse and extraodinary, I never doubted that they came from the heart.

I find it astonishing that a member of a Cabinet that has just agreed to remove an area of zero rating in the knowledge that we can never return to it, should accuse me of being a traitor. It shows an effrontery which is endearing but totally implausible. I hope that he will not return to that.

I return to the orders. Income support, housing benefit and family credit increase by 3.9 per cent., including the VAT compensation. In his uprating statement on 1 December last year, the Minister told us that the increase was higher than most people in work will receive. I understand that that is probably correct mathematically, but we all know that, even with the uprating, those on income support will find it extremely hard to make ends meet.

I think that I am correct in saying that after April, a husband and wife with two children under 11 will get £113.05. I accept that there are passported benefits, of which housing benefit is the most significant, and that there are a number of other aids and additions, but a family of four living on that figure will have very little room for comfort. It does not represent a cause for pride after many years of stewardship by the Conservative party.

The statistics on poverty tell a shameful story. The Minister will have studied the recent reports from the Institute of Fiscal Studies which showed that the richest 10 per cent. were £30 a week better off today than they would have been were the 1985 tax regime still in place, while the poorest 10 per cent. were £3 worse off.

The Minister would probably say that taking the extremes of the argument sometimes produces a distorted picture. That is a danger. There is always that possibility in trying to extrapolate an argument from a small group, but the bottom 40 per cent.—a very large slice of population—is significantly worse off than they would have been under the 1985 tax regime.

Against that background, I protest against any proposition that the present benefit rates are generous or allow people to sit back and think that they have no cares in the world and they can continue to jog along, not as the historical Earl of Durham did on £40,000 a year, but on £113.05.

Mr. David Willetts (Havant)

Does the hon. Gentleman accept that the Institute of Fiscal Studies report says nothing about the living standards of any group of the population; it is about the impact of tax changes? If those tax changes were compensated for by increases in benefits, as happened with the community charge, there would be no fall in living standards, even if the IFS figures showed an increase in tax payments.

Mr. Dewar

I understand the point that the hon. Member is making, and, as always, it is a sophisticated and perfectly fair one, but I think that he would also agree with my general proposition that the gap between those who have and those who have not has been exaggerated and broadened by Conservative tax policy. I am sure that he would worry about—and I do him the credit of thinking that he would worry about it. Also, on the kind of rates that I have quoted, it is very difficult for people living on income support, particularly in a time of general recession when it is often impossible, with the best will in the world, to find work. It is not an easy situation.

I am just protesting gently about the somewhat righteous air with which the benefit figures are paraded and we are asked to be grateful for what we have been given.

The Minister also dealt, very properly, with pensions and their uprating. I must confess that I am not as happy—he would not expect me to be—with the situation as he is. He well knows—it has been much debated and advertised—that the basic state pension has been falling as a percentage of average earnings for a considerable time: 15 per cent. at the moment and likely to drop to 7 or 8 per cent. in 20 or 30 years' time.

The Minister tried to tempt me in the debate and perhaps I can now tempt him a little into the interesting exchanges between his colleagues. The Chancellor, he may remember, in the press briefing reported in The Times of 2 December and very widely noted, made it clear that he thought that it would not be right to allow the state pension to be vestigial. He had said in the Budget speech that it was the cornerstone of the welfare state. so we have the Chancellor assuring us that it would not become vestigial, and three or four days later we have the Chief Secretary to the Treasury looking forward to the day when it would be nugatory.

I am tempted to ask the Secretary of State for Social Security to act as honest broker between his two colleagues, but it is probably a vain hope because I think I know where he lines up on this occasion—with the Chief Secretary to the Treasury. He told us in the corresponding speech last year: We are committed to linking the basic pension to prices."—[Official Report, 10 February 1993; Vol. 218, c. 1042.] The way in which he said it and the spirit in which it was said made it clear that, whether it became nugatory or not, he would not move from that position.

That means—this is something about which we should all worry—that if we are to deal with pensioner poverty we must rely more and more on the pensioner premiums within the income support system, and that will be a growing feature of Conservative policy in the years ahead, together with all the problems that go with a heavily means-tested system, which I think are unacceptable to the public as a whole.

Mr. Jenkin

The hon. Gentleman is perfectly at liberty to criticise that policy if he wishes, but is he offering an alternative? Is he implying that there is more money in the pot somewhere with which to increase the basic state pension over and above inflation every year, in order to prevent what would otherwise happen to it?

Mr. Dewar

I said something in an earlier exchange, and I do not want to tire the House by going over the same ground again; but I do not believe that the money that we have is being spent in the best possible way, because of the economic circumstances and the ever-increasing claims from the number of people who are dependent.

The hon. Member will know that when the Conservative Government came to power there were 4.4 million people dependent on supplementary benefit. Now, with the equivalent, which is income support, we are looking at close to 10 million people. I think that 9.9 million was the last figure that I saw. It has a dramatic effect on the economics and finances of the welfare state.

After all, we have the Minister incurring considerable unpopularity in order to drive out of the benefit queue comparatively small numbers of people with his various adjustments and trimmings. Those are literally handfuls of people compared with the kind of growth to which I have referred. So there is a strong case for saying it is not a simple equation.

May I also say to the hon. Member—we may have occasion to debate this at another time—that, in any event, it is not simply a matter of the basic pension. The basic pension ought to reflect increasing national prosperity, but it is clear that, for a long time, we must still wrestle with problems of pensioners in poverty. A number of schemes that the hon. Member will know about are under consideration and have been publicly discussed; they involve ways in which we can deal with pensioner poverty and with basic pensioners' incomes which are probably preferable—certainly in theory, and I hope workable in practice—to relying increasingly on a deepening tranche of income support premiums. In any case, there is a continuing debate in which I am sure the hon. Member and the Secretary of State will want to take part.

It is in a sense ungrateful of me to say that this is no more than was promised, that the uprating has been just what we would expect and is all very routine. The Minister is entitled to ask whether he has not done well, because he has kept the promise. When we remember what was said, for example, about no more VAT increases and about tax cuts year on year, I suppose that the Minister might try to claim that he had performed rather better than the Government as a whole, since manifesto promises have gone up in flames left, right and centre.

I find it just a little odd that the right hon. Gentleman should accuse me of abandoning pledges and promises, given the record of his own Government. He accused me of it last year as well. I suspect that he will accuse me of it next year and, when he is on the Opposition Benches, he will accuse me of it then. It is a form of words which is now in his head and in which he is well practised.

I thought it interesting that in last year's debate, the accusation was levied not at me but at my right hon. and learned Friend the Leader of the Opposition. What did the Secretary of State say about him? He accused him, at the previous election, of trying to increase national insurance contributions, a particularly hideous crime, I should have thought, and practically unthinkable. He added that not only was my right hon. and learned Friend trying to increase national insurance contributions, but, what was worse, he was trying to cut the benefits given to those who paid the contributions, another particularly unpleasant phenomenon and one about which he was quite severe.

I do not know—I do know; let us not be coy about it. I remember distinctly, in the week before we rose for the Christmas recess, the Government bulldozing through a Bill to increase national insurance contributions by 1 per cent., which would produce considerably more revenue, as the Secretary of State will know, than a penny on the standard rate of income tax. We have also had the job seeker's allowance announced and the incapacity benefit Bill launched on its way.

It seems to me that if the thoughts of the Labour party were thus roundly condemned, it must be nothing to the personal unhappiness of the Secretary of State in having to implement exactly the same policies as a Minister.

I should like to say a word or two, because the Secretary of State did, about the incapacity benefit that is being introduced. I pay tribute to my colleagues on the Standing Committee considering the Bill, who, I understand, are sitting very unreasonable hours and well into the evenings on a measure where there has been no sign of obstruction or anything other than constructive discussion. I sympathise with them and regret the way in which the Government are conducting their business.

The Parliamentary Under-Secretary of State for Social Security (Mr. Alistair Burt)

Scandalous.

Mr. Dewar

I think I heard the Under-Secretary saying, "Scandalous." I agree with him entirely; it is. We will agree that the word "scandalous" is applicable to the circumstances that I have described.

Incapacity benefit is a way of excluding people from benefit. The Minister knows very well our doubts about the mechanical test, about the confusion between disability and the capacity to work. I am sorry that the outcome will be a considerable number of people added to the unemployment register. That is something which the Minister's own Back Benchers may want to worry about in the near future.

The Secretary of State gave us an interesting estimate on Second Reading. He reckoned that, in the first year of incapacity benefit, 95,000 people would be added to the unemployment register as a result of the measure and that, in the second year, 190,000 would be added.

The Department of Social Security is working hard to manufacture unemployment. No doubt it will be suggested that it was "Lilley's lump" that did it, but I suspect that the Government will experience some problems. As I have said, long-term unemployment is on the increase, and I fear that those in the category that we are discussing will be added to the list after 12 or 24 months—those being the subdivisions of the category. I hope that I am wrong, but I do not think I am.

While the Government talk about how well they have done in regard to upratings, let me remind the House that some of those who survive the new test and receive the new incapacity benefit will be £30, £40 or even £50 a week worse off as a result of the hidden cuts in the formula. I need not cite extreme examples; it is easy to identify such cases. Those hidden cuts will make life much more difficult for people in a very vulnerable category.

I am not remotely referring to lead-swingers, scroungers or people who have settled for a comfortable life with the aid of a doctor who is not quite as stringent as he should be. I am talking about people who have survived the hoops and hurdles of the new test, and are genuinely eligible for help. They will find that much of that help has gone. The job seeker's allowance will not be introduced until April 1996, which could be described as the medium term; but, as a result of the cutting of the period conferring automatic eligibility from 12 to six months, some 100,000 people will lose their entitlement to unemployment benefit. The income support dependency figures will rise, which I consider very unfortunate.

May I ask the Minister some specific questions? The guaranteed minimum pension is being uprated again, but I have heard—I do not know whether it is true—that the Government are thinking of abandoning it. I do not suggest that they are contemplating total abolition, with no replacement provision; but I am told that the Department has discussed with industry the possibility of a substitute. That, of course, applies only to occupational pensions. I am always open to arguments, but I should be interested to know whether any changes are in the offing.

There is no equivalent of the guaranteed minimum pension in the private pensions sector. I know that regulation is Treasury-oriented, rather than social security-oriented; but investigations conducted by the Life Assurance and Unit Trust Regulatory Organisation, and by KPMG Peat Marwick on its behalf—and work done earlier by the Consumers Association, whose views are neatly summed up in the title of its press release "The Billion Pound Rip-off"—suggest that the Minister's pride in announcing that, since 1988, some 5 million people have moved into the private pensions sector is another reason for examining the lack of regulation.

We should also consider the number of people on very low incomes—perhaps below £9,000 a year—who have invested in private pension plans, despite the general advice of the industry that such action is unwise in view of the charges and commissions involved. It would not be fair to plunge into a debate on that; I am simply flagging my genuine concern about what is happening. It is difficult to achieve a satisfactory regulatory framework when pension plans are sold by people whose livelihood depends largely on commission.

I hope that the Minister will also say a word about statutory sick pay. That will interest at least one hon. Member who is present:I understand that Lord Jenkin has featured prominently in debates in the other place, one of whose Members described him to me as a Tory grandee. I do not know whether Lord Jenkin himself would accept that description; I always associated him with the "brush your teeth in the dark" days of 1973–74, and I am not sure whether such conduct, or such advice, is becoming a grandee.

Anyway, Lord Jenkin led the charge in the House of Lords. I am anxious to know exactly what is happening; I know that an amendment was brought to this House, and was dealt with ably by my hon. Friend the Member for Manchester, Withington (Mr. Bradley), but I am not sure what the next stages will involve. I think that it is generally agreed that the vast majority of sickness-related absences in small businesses are limited to four weeks, which makes the 100 per cent. rebate granted after four weeks considerably less generous than it appears.

I was genuinely surprised when Lord Astor—answering Lord Redesdale—said in the other place that a reduction to two weeks would increase the cost to the Treasury from £25 million to £30 million. The comparative modesty of the figures may illustrate how few employees will be covered, even with the increase in the national insurance contribution limit to £20,000.

I should like to hear a progress report from the Minister, along with some indication of where we go from here. I hope that he will seriously consider the two-week measure; I know that the Federation of Small Businesses, and Bill Anderson and his colleagues in Scotland, are very keen for some progress to be made.

If the Secretary of State hardens his heart and says no, what will happen to the report that will be substituted for an order or regulation? Presumably, it can be debated; but under what auspices? Will the Government make time for both Houses to discuss a report that says no—despite the efforts that both Houses have made? If such a report is published and there is no opportunity for scrutiny, debate or consideration, it will be seen largely as a swiz.

Sadly, many of the problems that featured in the corresponding debate last year are still with us. My hon. Friend the Member for Withington recently drew attention to the lack of progress on the independent living fund of 1993, and the fact that only £500,000 of an allocated £4 million budget had been taken up. The Minister of State says, "Ah, but that is worth £5 million or £6 million in a full year." If I remember rightly, the old scheme went up to £19 million or £20 million. It is a very disappointing result; people in social work tell me that there are immense practical difficulties, and that the scheme is just not working well. The Minister may well want to consider that aspect a little more closely than it has—apparently—been considered in the past.

The other day, my hon. Friend the Member for Burnley (Mr. Pike) was given an interesting answer about the social fund and its administrative expenses. I accept that discretionary schemes are always expensive, but it is nevertheless startling to learn that those administrative expenses amount to 45 per cent. of the sum disbursed. That makes the case for a simplification of the scheme; we find the cash limiting particularly distorting.

One thing has changed. In last year's debate, we heard a great deal about the Chief Secretary to the Treasury. The Minister made considerable mention of the social security review that he had instituted, and I have the impression that he was a dominant figure. I realise that the Chief Secretary is now rather devalued: he made the mistake of making too many speeches. Worse still, quite a lot of them were read, and some very odd things emerged.

I read with great interest the speech that the Chief Secretary made to the rather quaintly named Conservative Way Forward Group. I recommend the speech to the Secretary of State; indeed, the right hon. Gentleman probably knows it well. I do not know that the Chief Secretary's "back to basics" ideas will have been of much help to that group, but they were interesting.

I had not realised—I do not know whether you had, Madam Deputy Speaker—that the decline of this country could be dated precisely to the time when we allowed Marx and Engels in to live and work freely here. I was interested td discover that some universities wallow in self-satisfaction. Apparently, they are good places from which to pour scorn on the world outside. We were told that through those universities had passed nearly all the people who enjoy influence today and that, as a result, a fine tradition of national tolerance had been corrupted into a new tendency to nihilism. I think that that must be a reference to Oxford and Cambridge. My understanding is that the Secretary of State went to Cambridge, as did the Chief Secretary. I hope that they were not in any way corrupted by nihilism. In any case, according to the Chief Secretary's interesting speech, a university education is the source of national decline.

When we were dealing with last year's uprating, we were told that there was a grand design. At least that was the implication of every comment. Now the Secretary of State—and I understand why—is anxious to say that he does not believe in the "big bang" approach. [Interruption.] I mean that, in terms of social security reform, he does not believe in the "big bang" approach.

Lest the right hon. Gentleman think that I am being risqué, let me make it clear that this is a term that he himself has used. [Interruption.] I misunderstood. I thought that the right hon. Gentleman was protesting about my language, but apparently he said this last year. In any case, the "big bang" approach is now unfashionable, and it seems to me that we are proceeding by way of opportunity cuts. We are taking little areas of the social security system. Hence the incapacity benefit and the job seeker's allowance.

As these policies begin to unfold, it is clear that the Government are doing a great deal of damage. It is important that I should get this right lest I be accused of guilt by association. The ingenuity of the Secretary of State is becoming a byword—certainly in my circle—so I am anxious to get these matters straight.

I should like to finish on an obvious but important note. The Government have accused me of being somewhat silent. This is a charge that is not comonly made against me, but I am always prepared to stand new types of abuse. The Secretary of State has put forward his version of Labour party policy. We shall have opportunities to debate the future of the pension system and the retirement age. We have made clear our belief that the important features are choice and flexibility, and in that regard we have the support of many people in the industry. I assure the Secretary of State that we have not made the commitments to which he referred rather briefly and, I thought, somewhat jokingly.

If we are to talk about consistency in these matters, I have to congratulate the Secretary of State on one very important inconsistency. For a long time he talked about opting out of the basic state pension. Conservative Back Benchers who are in the Chamber will remember it. Working parties were set up, and there were specific references to at least the possibility of opting out. As I have done once before, I now record my thanks to the Secretary of State for having ruled that out as a possibility. The clarification was helpful.

The right hon. Gentleman will remember "The Walden Interview" of 5 December, in which, despite a spirited plea from Brian Walden that he should not disappoint his fans—a small and select group—he made it very clear, as a pledge for himself for ever, that there would be no opting out of the basic pension. Many of us regarded that as important and helpful.

I hope that the right hon. Gentleman will make other things clear.

Mr. Lilley

The hon. Gentleman is right, but I hope that he will make it clear that I was primarily ruling out means testing of the pension. Would he care to comment on the views expressed at the weekend—stated on television on Saturday evening and repeated on "The Frost Programme" at breakfast time on Sunday—by his right hon. Friend the Member for Islwyn (Mr. Kinnock), the former Leader of the Opposition? Was the right hon. Gentleman authorised in any way to float this idea? Is it in line with the original request of the current Leader of the Opposition that the Commission for Social Justice should consider the means testing of all conceivable benefits? Or is the former Leader of the Opposition just a maverick to be ignored?

Mr. Dewar

The right hon. Gentleman has offered me a splendid series of options. The first point that I must make is that my right hon. Friend is entitled to float any idea he wants to float. I hope that the Secretary of State is not suggesting the introduction into the Labour party of the thought police concept that, presumably by implication, exists in the Conservative party.

The former leader of my party is a very welcome entrant to the debate about the future of the pension system. I did not see the television programme to which the Secretary of State has referred, and I do not think that a transcript has been printed. Thus, I am not aware of the detail of my right hon. Friend's comments. No doubt the Secretary of State has a transcript. I can think of no industry—especially in social security—that has experienced more growth than the business of producing transcripts. Indeed, I have several here, so the right hon. Gentleman and I could play snap.

It would be unfair of me to comment on something of whose details I am unaware, but I welcome any contribution to this debate.

Mr. Lilley

Will the hon. Gentleman rule it out?

Mr. Dewar

I cannot rule out something that I have not seen in detail. [Interruption.]

Madam Deputy Speaker (Dame Janet Fookes)

Order. We cannot have sedentary interventions from anyone—not even from a Secretary of State.

Mr. Dewar

In view of what I have just said, it would be ludicrous to rule anything out. I hear the Secretary of State say, "Very helpful."

Mr. Lilley

The hon. Gentleman has just welcomed the fact that I ruled out means testing, but he refuses to rule it out. To say the least, it is an odd position for the Labour party's spokesman.

Mr. Dewar

The right hon. Gentleman is playing intellectual games of a particularly peelly-wally sort, and I am not impressed.

My understanding of the proposal is that it made use of the tax system and certainly was not as dependent on any form of means testing as is the system employed by the right hon. Gentleman, who has condemned 1.6 million people to very heavy means testing by leaving them to make ends meet through income support. The Secretary of State's suggestion that his hands are clean does not bear examination.

I hope that the right hon. Gentleman will continue to clarify his position. We now know that he has abandoned any hope of a system that would provide for opting out of the basic pension scheme. I cannot invite him to intervene, but he might like to tell us at some point whether he agrees with the Chancellor of the Exchequer, who said that everyone was in favour of family values, but that the day-to-day practicalities of politics had to deal with society as it was. Society had changed a lot and would continue to change, but I do not think we should use things like the welfare state as an instrument for trying to move these changes in any particular direction. Perhaps the Secretary of State agrees with that. I hope that, if he gets a chance, he will confirm his position. We should have an interesting background for future debates were we to know where he stands.

There will undoubtedly be many more debates on this subject. There is a great deal of argument to come. I am not satisfied that the Secretary of State can take pride or satisfaction from the collection of instruments that we are considering today.

Of course, the Secretary of State always has a little list when a Conservative party conference is looming. That is the trouble. He then usually produces something that is far from his finest hour. But the tragedy is that he has another list with a more serious intent—a list of trimming, cutting and undermining measures such as have been enacted in recent legislation. I suspect that even some Conservative Back Benchers have had to push and shove through measures about which they probably had considerable doubts.

I accept that that has not been a big bang approach, but the incremental approach is no more acceptable if the end product is wrong. When the Minister says, as he did last year, that he has a coherent and sensible reform programme, few will agree. Many of the vulnerable people who have been, or will become, the casualties of his efforts will testify to that.

7 pm

Mr. Archy Kirkwood (Roxburgh and Berwickshire)

Before I start what I intended to say, I must tell the House that I too saw the broadcast on Saturday evening in which the former leader of the Labour party was shown some of the options by representatives of the Institute for Fiscal Studies. The conclusions drawn and the implications of the programme, in terms of what the right hon. Member for Islwyn (Mr. Kinnock) said about means-testing pensions, were most interesting. I shall be keen to see what more he does with the idea, and whether he takes it forward.

The Secretary of State knows—in fact, he keeps reminding me—that, at our party conference in Torquay, lost an argument about means-testing pensions. However, in retrospect I am happy to confess that it was right that lost. [Laughter.] How is that for baring one's soul and conscience? As we look at the future costs of pension increases—

Mr. Lilley

It is embarrassing.

Mr. Kirkwood

It is not embarrassing at all. We have free debates and make decisions at our party conference and we are honest enough to confess the circumstances in which we subsequently find ourseleves. I am now fairly persuaded that future increases in pension provision will have to be targeted to be meaningful.

That does not go as far as the former leader of the Labour party went when he was being led astray by the IFS representatives, who draw simplistic straight lines down boards with fibre-tipped pens. Alas, if only the solutions to social security problems were that simple. A tempting prospectus was laid before the right hon. Member for Islwyn, and he acepted it a bit too glibly for my liking.

The Liberal Democrats as a party are prepared to consider potential increases in the future provision of pensions being targeted. That is not to say that we would interfere with the existing universal state pension but, as has already been said, that is only 15 per cent. of national average earnings. If over a long period it were allowed to take its course in terms of its share of national wealth and earnings, and we considered carefully how to target increases, targeting could enable us to get help to the people over retirement age who are in desperate need of help, as some of them are.

The Government are right to have considered the average position of people over retirement age, and they can take some credit for that. We supported the moves by the Government some years ago to encourage the provision of private pensions. It was the right thing to do. The sum spent on it—£6 billion or £7 billion—went a little over the top; they got the judgment wrong on the incentives. But although that was a substantial sum, the mistake was a detail in comparison with the policy decision to encourage private provision, which was right. That decision will pay handsome dividends in future when we examine the need for the state to supplement the provision made for people who are over retirement age.

Having agreed with the Government and welcomed the increases available to people on what is now the average income for pensioners—I am happy to acknowledge the fact that that has increased—I still do not think that the Government are doing enough to look after the people who are left to exist on the state pension alone. If that is true now, it will be even truer after April, when the increase in VAT comes into play.

We can argue about whether the package of measures intended to compensate people was enough. I do not think that it was, and I am now beginning to find both in my case work and in the letters that I receive that people are anticipating the prospect of the VAT increase with real apprehension and genuine fears about how they will make ends meet next winter. Whatever else the Minister says when he replies, I hope that he will spend a moment or two saying what he has in mind in terms of careful monitoring. Obviously it is too late to change the uprating orders, and the increases are welcome so far as they go, but they do not go anything like far enough.

I am especially worried about the 2.7 million children identified by some pressure groups as being in families on income support who will be left short and may go cold next winter. The compensation package may well be enough for households in average circumstances; I do not deny that. However, the IFS work on the distribution of the tax advantages over the past few years, which was mentioned by the hon. Member for Glasgow, Garscadden (Mr. Dewar), is right, and the statistics show that the distribution of wealth over that period has benefited the better-off sections of society. Households living on below average incomes are in for some hard times.

The Government have not paid enough attention to people living on state pensions who suffer from disabilities of one kind or another, or to families on or around the poverty line—big families, with consequent additional costs, on low incomes. There is no extra help for people who are unemployed, for people just above benefit levels, or for people who do not claim their full benefit entitlements. So there are still some worrying areas. Those may not be complete groups in society, but large numbers of people are in those special circumstances, and I do not think that the uprating caters for them. A 3.9 per cent. increase across the board is welcome so far as it goes, but it does not deal with the difficulties that many of those groups will face.

The Minister should take account, too, of the wider implications of the IFS tax distribution study. It reveals facts that the Department of Social Security should take to heart in the arguments at the broader national level concerning the share of national wealth that it is right to devote to social security spending, because those arguments are pinned back into the proposals in the uprating order.

There is loose casual talk, much of it from the Minister's colleagues, about a crisis in welfare spending and the need to take precipitate emergency action to deal with it. If the expenditure devoted to that important area is measured as a share of national wealth, I do not believe that it is right to say that there is a crisis. There is no need for precipitate action, although there is an urgent need to keep the situation under close and careful review. Talk of crisis and great disasters immediately impending is not right, and we must keep that fact in mind. By and large, the percentage of national wealth devoted to social security has not increased dramatically. Nor need it be increased if sensible policies are adopted on a continuous basis.

I am pleased that the Secretary of State is paying attention to the need to constrain fraud. However, he must be careful that he is not heavy-handed in the way in which he enforces measures. There are savings to be made. I met his colleague in another place and I was impressed by some of the work that is being done to try to save money so that we can be more generous in some of the uprating orders in future.

The Secretary of State must also be careful when he sets targets. Of course there may be as much as £500 million to be saved, but he must not go at that figure too hard and too fast, as has the Child Support Agency. He could have saved himself a lot of heartache in the CSA contest if he had tapered that agency's targets for recovery in a less steep way. To try to recover £530 million in the first year of operation was far too ambitious, and he is paying the price. People such as myself are beginning to question the principle of the legislation because the practice is being so rigidly enforced.

The Government deserve some recognition of the steps that they have taken in the overall uprating increase and of some of the longer-term policy changes, but there are three small areas that I would like the Department to consider. First, in the totality of Government policy, the question of carers and how they are catered for in the social security system as it exists at present is inadequate. The orders do not recognise some of the demands placed on people looking after people with disabilities.

I acknowledge that the budget for benefits to people with disabilities has increased substantially in the recent past—not because the benefits are becoming more generous, but because more people are encouraged to claim eligibility and are being accepted. The provision for carers needs to be considered and, with a little ingenuity and creativity, a lot more could be done to help them.

The second issue is not directly related to the orders, but is more a direct responsibility of the Department of Education. The withdrawal of income support for students during long vacations is having an adverse effect on the income available to students. In his previous incarnation, the Leader of the House, who is in his place, and I argued over whether it was right to pay for students through the income support system, and he persuaded me that it was not. However, that is not to say that the system which replaced the withdrawal of housing benefit and income support in the long vacations is anything like adequate.

In considering some of the uprating orders before us, the Department of Social Security has a duty to consult the Department for Education and to be absolutely satisfied that the Department for Education is providing properly through the scheme which replaced the original social security assistance to students. There is emerging evidence, not only through my case work, but in information from national organisations and pressure groups including the National Union of Students, that some students are not completing academic courses because they cannot make ends meet. If the problem is as extensive as I believe, the Department should have urgent talks with the Department for Education to try to resolve the matter.

Thirdly, I turn to the issue of statutory sick pay. It is not terribly convenient to discuss all the orders mixter-maxter. We always used to have a clear uprating debate, which I much preferred. Dotting about through all the orders makes it more difficult for the House to give proper attention to their detail and importance. I perfectly understand that, currently, the business of the House is not always under the control of the Leader of the House and that he has to deal with the nonsense that the Opposition land on him. That is a subject for another debate which will happen sooner rather than later.

The hon. Member for Garscadden raised an important point about the draft Statutory Sick Pay (Small Employers' Relief) Order by adverting to the answer given in the other place to a question asked by Lord Jenkin. The Government revealed that it would cost only £10 million—not an insignificant sum of money—to reduce the four-week period of SSP to a two-week period for small businesses with effect from April 1994.

If I were a Minister, I would be careful considering that. Taken as a package, industry may benefit, as the Government point out with statistics and arithmetic, which I accept, but tiny businesses with two, five or 10 employees, which may face flu epidemics or the like, will not be able to cope easily with the regulations as they stand. There is a good argument for spending that £10 million. It could address the entire issue once and for all and, as the hon. Member for Garscadden said, we should consider it carefully.

An argument which raged 18 months to two years ago has raised its head again recently in a way in which worries me greatly. It concerns preserved rights of income support for people in residential homes. It is a technical area which affects a relatively small number of people, but I have come across a couple of cases—not only of constituents but of people in other parts of the country—in which people with preserved rights are finding it difficult to make sense of being unable to top up the income support that they receive. Not only are those people unable to top up their own income support, because of lack of money. but the health boards and local authorities in Scotland, England and Wales are not in a statutory position to help.

Mr. Keith Bradley (Manchester, Withington)

That matter was discussed in the past year.

Mr. Kirkwood

Indeed: the question was raised in the past year and I accept that some changes were made. However, the changes made were to cope with circumstances such as evictions and emergencies. I make a plea that the Government consider the question again and give at least an element of discretion to health authorities or local authorities—I do not care which—to enable them, in certain compelling circumstances, in which people are no longer able to stay in the home of their choice despite arguing for a variety of reasons that that home is especially appropriate, to allow residents to stay.

It seems extremely cruel to require people to move from that home for the sake of £6 or £7 top-up per week. It would not cost an enormous sum of money and if health authorities or local authorities were given that power, they would not go mad and be profligate.

The legislation as it stands, even though it has been amended recently, is not sophisticated and sensitive enough to cope in a common-sense fashion with circumstances that affect old people who have lived with preserved rights for many years in places such as the Leonard Cheshire homes. Such homes provide an invaluable service and back-up support. At the moment, income support cannot help them, but the Department should talk to the Department of Health and to local government to try to achieve a more sensitive system which could cope in such circumstances.

It would be helpful if the Minister would consider that point. It would not cost a lot of money to solve the problem and it would not affect thousands of people. The Minister could open the door and enable discretion to be used to provide immense relief to people who are currently caught in a statutory trap. That trap was created inadvertently; Parliament did not have it in mind to prevent the opportunity for topping up in certain circumstances when people are facing eviction.

When the Minister replies, I hope that he will consider the consequences of the imposition of VAT on low-income households and families. Although the Minister was right to say that his package may well cater, on average, for the needs of the majority of people, large sections of the community—a figure of 2.7 million children has been referred to—will suffer greatly as a result of exposure to cold and hardship next year unless the Government urgently reconsider the scheme and introduce improvements in the very near future.

7.20 pm

Mr. Jeremy Corbyn (Islington, North)

I am pleased that we are having a debate on the orders, but I am disappointed that there are not more hon. Members here to participate in it. There is clearly much controversy about the issue, and the future of the welfare state is at stake. That future is bound up inextricably with the orders and with the onward march to the Valhalla of the Adam Smith Institute to which the Secretary of State for Social Security is trying to lead us.

The Minister is a long-term conspiracy theorist and, to be fair to him, he sets out his theories in public. He is publicly trying to dismantle and destroy the welfare state. He is publicly trying to privatise as much of the welfare state as he can, and he is publicly trying to create a very divided Britain. He is being very successful at that.

One need walk for only 10 minutes from this building to find large numbers of young people sleeping on the streets of our capital city. If one walked the same distance in another direction, one would find many people paying £100 a night for hotel rooms because they can afford to do that. One would also be able to see people eating meals in restaurants and paying bills that amount to more than the weekly income support giro cheque. The Minister is presiding over the division of the country. At least he has been open about that.

The Minister has been very clever to shift the terms of the debate by claiming that this country can no longer afford universal welfare benefits, universal pensions and the welfare state. People like the Minister have cleverly pursued that point in the broadsheet press, and to some extent on radio and television, to the exclusion of all considerations of poverty. The voices of the homeless and the poor and the voices of those expected to subsist on a state pension are largely unheard. Instead, experts on huge salaries tell the poor how they should live and say that the poor are an increasing burden on our society.

Year after year, as the Tory party conference approaches, the Minister, like his predecessors, searches around for a new scapegoat on whom to blame all the nation's problems. I recall when 16 to 17-year-old feckless youths were the target of that year and were accused of not seeking work. As a result, many of them now receive no benefit. Many end up on the streets, and many of those are then driven into drugs and prostitution. Ministers should think about such things before they set off in particular directions.

The Minister attacked single parents at the Tory party conference last year. He has consistently attacked single parents, claiming that they are a drain on our society and that their children under-achieve. The Minister might try to deny it now, but he has consistently attacked the whole principle of single parents. He knows that that is the case, although when he appeared before the Select Committee he was remarkably coy on that subject.

The Minister has approached benefit fraud as though someone, somewhere, actually approves of it. None of us approves of benefit fraud, but the Minister assumes that large numbers of people do. He should remember that London local authorities, the majority of which are Labour, are doing their best to stamp out conspiracies to defraud the public purse in respect of housing benefit. However, the Minister should consider the amount of housing benefit money that is paid into the pockets of private landlords and the owners of bed-and-breakfast hotels through the system of rent deregulation.

The real fraud, as revealed in one of the orders, relates to the change in the unemployment benefit system. To reduce from one year to six months the time when unemployment benefit can be paid is a fraud on a massive scale. After all, it is a contributory benefit. It is something for which people have paid all their working lives. However, we are being told that this is some kind of advance.

Who on earth is the Minister of State to decide that that change should be made? As the Minister's predecessor did before the war—those people had the same kind of blinkered mentality about the divisions of society and the rich and the poor—the Government are blaming the unemployed for being unemployed and making them the scapegoat for the recession that the Government created and advanced.

The orders do not provide us with the opportunity to reduce or eliminate poverty. Instead, they are a further step on the road of division. We should think very carefully about this. If we want to live in a Britain in 10, 20 or 30 years' time with a permanently unemployed work force of 3 million to 4 million, permanent divisions between rich and poor and a very small number of extremely rich people, we are heading in the right direction.

The Minister has created hysteria about the cost of the welfare state. Fortunately, there are those who do not accept that hysteria. I refer the Minister to the excellent work of the Rowntree Trust carried out by John Hills at the London school of economics in which he sets out a range of options about the costs of the welfare state. However, he also sets out the consequences of not maintaining the welfare state.

In a very good summary of John Hills's research, Will Hutton states: it is vital to wrest the argument from those who insist that such is the financial stringency the only issue is to make each welfare pound most effective; rather the debate should be about how we choose to live as a society. The welfare system is just one of a series of building blocks, all of which interconnect to construct our common home. That surely should be the approach, but it is not. Instead, as the pension uprating order confirms, pensioners are being defrauded by the break of the link with earnings which was removed in 1980. In 1975, Labour passed legislation stating that the pensions should be uprated annually by the higher of either earnings or prices. That principle was broken in 1980 and substituted with prices. As a result, each pensioner is about £18 a week worse off.

The Government glibly talk about the number of pensioners receiving occupational pension schemes and the number of pensioners who have investment income. They quote various average figures to show that no pensioners are worse off. However, they deliberately hide the serious plight of a considerable number of pensioners who have to live solely on the basic state old age pension. Those people may possibly receive housing benefit to assist with the rent, but they lead a pretty miserable existence. The Government should pay some regard to them. Perhaps they do not because the majority are old, women and do not have access to occupational pension schemes.

We are told that, because of demographic trends, it is important to equalise retirement ages upwards to 65. That is absolutely extraordinary. The country is considerably wealthier now than it was in 1910, when pensions first came fully on stream, and wealthier than it was in 1948 when the universal welfare state was virtually completed. However, we apparently now cannot afford to allow people to retire at the lower age.

I do not mind if people want to work beyond the age of 60. I have no problem with that. However, people should have the opportunity and the right to retire at 60. It is a monumental fraud on women workers to tell them that they will now have to work until they are 65 when they have been told all along that the retirement age was 60.

In that respect, the Minister prayed in aid the fact that similar moves were taking place in other European countries. The fact that a bunch of right-wing monetarists around Europe are peddling the same nonsensical theories, which have driven Europe to its present level of poverty with 15 million people out of work, is hardly a reason for rejoicing. It should be a reason for shame for the Government. Instead, we should be looking to share the wealth so that people can retire at an earlier age if they so wish. I should like to see a proposal to equalise the retirement age downward for both men and women so that couples will have an opportunity to enjoy retirement together.

Claims about costs are extraordinary. In population projections, there will indeed be a peak in the number of people of retirement age at about 2030—in other words, in about 36 years—but, after that time, the number starts to decrease, as the Secretary of State will be aware. Instead, the Government choose to end all their predictions at that point and claim that there will be an enormous increase in the cost of the state retirement pension unless something is done about it now. That is why the link was broken and that is why the Government tried to destroy the state earnings-related pension scheme as an option.

The push towards private pension schemes, individual schemes and personal portable schemes is extremely dubious—dubious because of the methods in selling many of them, dubious because of the security of some personal schemes that are on offer and dubious because of the legal position of many pension schemes at present. I am a member of the Select Committee that is still examining the administration of pension funds. Some of the things that we hear make one's hair stand on end. The Maxwell pension fraud was just one example. Although this matter is slightly irrelevant, I hope that the Minister will give an inkling of when the Government will propose legislation on the control of pension funds.

There is now 22 per cent. unemployment in my constituency, and a large number of people are unable to claim unemployment benefit and therefore are not included in the real statistics—the real figure is much higher. Such people do not lead particularly exciting lives; indeed, they lead very miserable lives. Annual rent increases, even those in local authority rents, particularly for people on low earnings, are much higher than the rate of inflation, although those paying them receive housing benefit if they are unemployed or on income support. Their children are not growing up in a particularly exciting environment, because they face more cuts and increased charges for school meals, trips and so on. Our children are growing up in an increasingly divided society. I hope that the Secretary of State will at least begin to address those issues.

The Secretary of State talked glibly of the job seekers' allowance; he said that if only there were a different allowance that would encourage people to seek work. He seems to fail to understand that people do not like being unemployed. It is not a very exciting life, it is not a holiday camp, it is a time of great depression. Many of the long-term unemployed become extremely depressed. The longer they are unemployed, the harder it is to find work.

The Secretary of State attacks people in receipt of invalidity benefit as though a monumental fraud is going on. People receive invalidity benefit because they have been invalided, often as the result of accidents at work. Instead, we are moving to an incredibly expensive system of examination of the detailed cases of people on invalidity benefit. Likewise, the Government have removed the single payment system. In 1986, the Prime Minister piloted through the House the legislation that established the social fund. Recently, in an answer to me, the Minister admitted that the social fund is the most expensive of all benefits to administer. It is probably the least effective for that.

I do not welcome the measures, because they do not go far enough. Clearly, there are some increases for some people, and there are some improvements as a result of enormous pressure by some very effective pressure groups, but I do not believe that the Government or the Minister have any vision of eliminating poverty or of the maintenance of a universal welfare state. The Minister's vision is of an onward march towards privatisation and divisions in society. He should look at the record. A fifth of Europe's poor live in this country. Poverty and divisions are increasing. I hope that we return to the subject of the future of the welfare state and consider it not in the mealy-mouthed way that the Minister does but in the spirit of trying to eliminate poverty and provide real security.

7.33 pm

Mr. Sam Galbraith (Strathkelvin and Bearsden)

On Monday night, when I rose to speak on the local authority housing support grant, some of my colleagues questioned whether I was qualified to do so, as I represent the constituency of Strathkelvin and Bearsden, which is generally reckoned to be fairly middle-class and well-heeled. It is described as a leafy suburb. Many people might wonder at my interest in the uprating of social security benefits. It is true that my constituency is reasonably well-off. If the boundary commissioners have their way, there will be virtually no public sector housing in my constituency after the next general election.

I am particularly interested in the issues. In my constituency, a significant number of people rely on various benefits which, for many of them, are an important lifeline. I am also reminded now and again by constituents in the wealthier part of Bearsden just how adequate many benefits are. Often, people who have lived life in a fairly comfortable manner and are fairly comfortably off, for reasons not necessarily of their own making, suddenly find themselves on hard times and falling back on benefits. It is only then that they realise just how inadequate those benefits are. I am faced by irate constituents who ask, "How on earth am I supposed to live on this? How on earth is one expected to get by on these benefits?" Such questions would be asked by all of us in that position.

For that reason, I wish to examine four aspects of the measures, but none more so than the one which hits many of my constituents—income support benefits for nursing and residential care. As we know, nursing and residential care are booming. Certainly in my part of the country, nursing homes and residential homes mushroom every day. One can be certain that, if a school closes, it will open the following week as a residential care home.

Let us consider the costa geriatrica—the Ayrshire coast. Glaswegians no longer go "doon the water" for their holidays. Who does? Granny goes doon the water, into the geriatric home on the Ayrshire coast. Such homes have blossomed even in post-industrial areas—they are everywhere, and they are becoming an increasingly important part of our social structure.

The measures are particularly important because the NHS withdraws from the nursing care of the elderly when it should not do so. Many individuals who should be looked after within the NHS and within long-term care are being sent to nursing homes. There have been recent cases of individuals with head injuries, brain diseases or other diseases being removed from long-term care and being placed in nursing homes. Money must be found for them, partly from benefit and, depending on the circumstances and the relevant home, partly from the resources of those individuals or their relatives.

The matter is becoming increasingly important and it is throwing greater burdens on families who thought that it would not be a matter for them or for their relatives later in life. It will become increasingly obvious to many people, as their relatives grow older, that such care has been privatised without anything being done about it. I have constituents whose elderly relatives are decanted and placed in residential homes, and they find that they have to pay additional amounts. Although there are numerous residential and nursing homes for which income support is adequate through the social services, there are more in which the individual must make an additional contribution.

I have two important questions for the Minister. I do not want to say the usual, "We do not have enough; give us more," and so on. We will take that as read and spare ourselves the boredom of going through it again, but there are two matters that we should consider.

I was recently approached by a constituent whose relative had to go into a nursing home. He brought with him a file about 2 to 3 in thick, containing the paperwork—mostly relating to the financial implications—involved in having his relative put in the residential home. He was highly intelligent and articulate, but he had spent several months on the matter and had had to complete a large amount of paperwork. He and I wondered how the many others managed to cope. I plead with the Minister to consider making the provision of residential nursing care simpler.

My constituent said that the finances demanded of him did not cause a problem. One of the first acts of the nursing home was to put the finances in order, but the medical side was allowed to slip. He faced difficult problems, including 2 or 3 in of paperwork from the Department of Social Security, the social services and the Department of Health. Everyone batted the paperwork around the residential home. Will the Minister consider how such matters can be dealt with more easily? Residential nursing provision is often sought at a time of great difficulty for families, who may have suffered recent bereavement and may have many other matters with which to deal. In addition, they face the catastrophic problem of dealing with multiple forms and individuals.

The regulation of residential nursing homes is a matter for the Department of Health, but the subject should also concern the Department of Social Security, which provides large amounts of money. I should have thought that the Minister would want to ensure that the money was used properly and effectively.

I am sure that the Minister would agree that the regulations are inadequate; many of them are out of date. They involve matters relating to fire escapes, the number of car parking spaces, the temperature of the tap water, what the carpets are like and whether the windows should be open. They do not deal adequately with the care of residents or contain powers to close homes. There are no means to deal with inadequate legislation. Often, a board or authority wishes to take action against a home but cannot do so because it is not within its powers.

I accept that such matters are not the responsibility of the Minister's Department, but he should be concerned about them and he should have discussions with the relevant Departments. I want the Minister to consider regulations to cover those problems. I do not want to repeat the argument that there is not enough money available—we shall take that as read. It is an important matter and we need the regulations. My constituents, who live in the leafy suburbs of Strathkelvin and Bearsden, constantly come to see me about such problems.

Some of my constituents also complain that they cannot live on the benefit provided. I live in a constituency with little public sector housing. If the boundary commissioner has his way, it will have no public sector housing, but will remain a Labour seat. I realise that that would be unusual in other parts of the country, but it is not in Scotland. On Monday, we discussed the relationship between the reduction in deficit funding and housing support grant, and the greater emphasis being placed on rents and housing benefit. I make a plea for more funds to prevent pockets of deprivation, even in my constituency.

I also make a plea for the retention of child benefit. People who receive it throughout my constituency, including its better-off parts, appreciate its value—not only in financial terms, but for its recognition of the family and the integral part that it plays in our society. For many people, child benefit forms an important part of the budget and helps them to avoid poverty. It also recognises the importance of the family to children and the cost of having a family. The Government should recognise that and should constantly uprate child benefit. I realise that the issue is always at the forefront of Conservative ideology.

Dr. Robert Spink (Castle Point)

The hon. Gentleman said that he would like a general increase in benefits,particularly for housing. The hon. Gentleman has made some excellent points, with which I have some sympathy. But does not he realise that, since 1979, social security spending has increased in real terms by 75 per cent? If he wants to increase that budget, by how much would he incrase it and how would he fund it?

Mr. Galbraith

I said that I would not repeat the usual litany of saying that there were not enough funds and please could we have more. I hoped that Conservative Members would not go through the usual litany of asking how we would pay for it. I shall not fall into that trap. It was worth the hon. Member giving it a try, but he will understand why I choose to ignore him. [Interruption.] Does the hon. Member for South Dorset (Mr. Bruce) wish to intervene?

Mr. Ian Bruce (South Dorset)

indicated dissent.

Mr. Galbraith

Very well—I shall ignore the hon. Gentleman.

The subject of workmen's compensation and industrial diseases benefits is a wide one. I understand that they are not the responsibility of the Minister, but I should like him to consider the general principles of those benefits and diagnosis in relation to such matters.

I was involved in a long-running case and correspondence concerning asbestosis and mesothelioma., compensation for which was the responsibility of the Department of Employment, as the Minister will be aware. The Department was generous in dealing with compensation and making back payments, but the issue centred around whether compensation should be paid from the time of diagnosis or after the board. The issue involves the Department of Health, the Department of Social Security and the Department of Employment. We should consider the matter further. Officials at the Department of Employment tell me that they are considering and monitoring the subject, which generally means that they are not doing much.

That is not a specifically political issue, so there need not be any disagreement between the parties. Many of the decisions on when compensation should be paid and when the diagnosis was made were based on criteria that were established many years ago. With improvements in technology, we can alter the criteria for diagnosis and we should be considering that.

Mr. Corbyn

I have a constituent whose mother worked as a cleaner in a Glasgow bus garage and died as a result of asbestosis. Is my hon. Friend aware that one of the problems for people suffering from industrial diseases and illnesses brought about by working conditions, such as asbestosis, is that the settlement of fault often takes so long that the person who has suffered dies before he or she can receive any benefit? The case of the lady who worked at the Glasgow bus garage was a particularly serious example of that.

Mr. Galbraith

Compensation made while people are still alive is double the amount of compensation made after death. Although the diagnosis may have been made by biopsy, if the individual dies before the board can confirm the diagnosis and make the award, the compensation is halved. It is the difference between £23,000 and £11,500. That is grossly unfair.

The basis for the system is that, in the past, diagnosis was difficult. It was probably based on a physician listening to the chest and saying, "Say 99. Breath in and out. Let me look at your fingers for clubbing." If people were lucky, they may have had a chest X-ray. However, that is no longer the case for many people. Objective criteria can now be used in many cases.

I would like the Minister to address the four issues that I have raised, especially the one relating to residential care. We should make it easier for individuals to deal with residential and nursing care and stop the need for everyone to have a 3 inch file. These issues transcend all sections of society. As I said, my constituency is mostly middle class and after the next election it is likely to be totally owner-occupied. However, these are major issues within it.The issues are not isolated in one pocket or confined to one group in society. They relate to everyone in our society. I hope that the Minister will look favourably at the issues.

7.50 pm

Mr. Paul Flynn (Newport, West)

It is a pleasure to speak briefly in this important debate on pensions and other matters. The subject of pensions occupies us greatly because, with the funds available, they represent a large slice of our national wealth. It is fair to say that we will be on an extremely dangerous path if we follow the line presented by the Government and accept their mythology.

The greatest improvement to our pension policy took place in 1975 with the introduction of the state earnings-related pension scheme, which was supported by all parties. When the Conservative Government came to power, they changed that policy and announced that they would get rid of SERPS altogether. They did not do that, but in the mid-1980s they degraded the value of SERPS to a large extent—and that is continuing. After that, an inquiry into pensions was held. I believe that the Government made their great error in the way in which they proceeded from there, because they then announced that they would give the country a choice by making personal pensions available and they bribed people to take them.

There are many examples of what was said in the House at the time. There was some disgraceful advertising. Rather than go for the sleazy operators, I took two of the principal banks—Barclays and Midland—to the Advertising Standards Authority for the advertising that they carried out in 1989. It was wickedly deceptive and, indeed, my case was proved. The banks advertised by saying, "You can have a gift of £5,000—don't be a SERP"—as if a SERP was a nasty, oily, unpleasant animal. They said that people should not be fools and should take the £5,000 gift—that was the word they used—from the Government.

The gift consisted of people's contributions to the state scheme and the contributions made by employers, plus a little tax allowance, plus the alleged gift, which one would more accurately call a bribe, which was paid out of the national insurance fund. Many of the people who took that line—at least 2.5 million of them—now bitterly regret their choice. What happened was that the greedy sales people from the banks and the building societies—many of whom were employed for only a short period—largely oversold the policies, especially to people over a certain age. The policies were of no value to many people in their forties and fifties—indeed, they endangered their financial futures.

That is one of the major scandals that will be revealed in the future. We already know about those who were persuaded to leave fine occupational schemes and go into personal pensions. Once again, they were oversold because the sales people involved received huge commissions on the sales. After a short period, many of them found that the £5,000 had gone altogether. At least £2,000 would have gone in commission and the rest in administrative expenses, and people were left with hardly any funds at all.

The other point about personal pension schemes which has never been explained is that they are not pension schemes as people traditionally understand them; they are savings schemes. The amount that is paid at the end does not depend on what the person is likely to be earning at the end of his life—it depends on what is happening on the stock exchange. That would be good if the circumstances were similar to those in the 1980s, but it would be dreadful if they were similar to those in the 1970s.

We must ask the Government to reassess their support for personal pensions and their whole pension policy because they did not provide people with a choice. They threw millions of people to the wolves.

Another issue that will be raised in the debate on uprating concerns us all.

Mr. Corbyn

Before my hon. Friend leaves the question of personal pension schemes, is he aware that such schemes are heavily subsidised by the loss of income from the national insurance fund? We do not have a free market choice—we have a subsidy for private enterprise to set up personal pension schemes, many of which have proved to be less valuable than SERPS. Many people would have been well advised to remain in SERPS and not accepted the bribes to which my hon. Friend rightly referred.

Mr. Flynn

rose—

Madam Deputy Speaker

Order. Before the hon. Gentleman continues, I suggest that he returns to the measures before the House. I do not mind passing references to other matters, but he must now return to the major themes of the measures.

Mr. Flynn

I am grateful for that, Madam Deputy Speaker.

The other measures affect the uprating of various benefits. This has been an uncertain story over the years. When we want to know whether benefits can be uprated, we look at the health of the national insurance scheme. Certain benefits have not been uprated over the years. The child dependency allowance, which represented 11 per cent. of the average wage in 1979, now represents 6 per cent. That allowance is paid to the sick, the disabled, war widows and their children. It is surprising to realise how many child dependency allowances are paid, and the reason is the health of the national insurance scheme.

Something like £8 billion has been looted from the national insurance scheme to pay the bribes on personal pensions. That money has gone directly into the pension industry, which is fundamentally wasteful because of the number of people operating in the industry and the amount of money that goes in commission and administration charges. The national insurance scheme is, above all else, efficient because at the most only 5 per cent. of the money is taken out in administration charges. The amount can be as much as 50 per cent., as happened under Beveridge. That is the reason why we have the national insurance scheme, which was introduced by Lloyd George and improved by Beveridge.

Perhaps the Minister could tell us whether the new incapacity benefit will be uprated on a statutory basis every year and whether that will be part of the Government's policy. The reason given for the new incapacity benefit—it has been trumpeted aloud—is that many people who receive benefit are malingerers or scroungers who take money from the public purse when they are not entitled to it. It does happen. There are many cases of that and no one defends them. We should start with people who take money from the public purse on a large scale and who ask for some equality of treatment.

One family in the country has five houses paid for by housing benefit out of the public purse, and the family already owns two houses. The daughter-in-law of the head of the household has announced that she is not going to do any more work. As far as I know, she is still to be paid out of the public purse, but she has not been subjected to the actively seeking employment test.

Mr. Corbyn

Why not?

Mr. Flynn

I would like an explanation for that and perhaps the Minister can tell us tonight. The members of that family receive huge amounts of money out of the public purse, but they are not treated as scroungers or as people who are living off the state. If the Minister wishes to write to that family, he will find that the address is Buckingham palace, London.

A result of the one order that we are debating is that the basic pension will be uprated. The Labour party increased the real value of the basic pension by 20 per cent. That Labour Government are often accused of many things, but we did allow the basic pension to increase by a reasonable rate over the years. We could not maintain the full promise, as Government Members constantly remind us, but we honoured our pledge to increase the pension by a substantial amount.

This Government have constantly pared away the basic pension with their salami cuts. I do not think that any debate on social security goes by without a Government Member repeating the familiar mantra that the Labour party could not pay the Christmas bonus for two years. That is something to which they return every time they are desperate.

Dr. Spink

I will not repeat the mantra, but will the hon. Gentleman comment on the fact that the average pensioner is now 42 per cent. better off in real terms than in 1979, when we took over the levers of power from the socialist Government? Does not that show the Government's commitment to pensioners and will the hon. Gentleman support the current uprating?

Mr. Flynn

The statement proves the gullibility of the hon. Gentleman, who used the word "average" in his question. One must remember that, for instance, the Queen Mother is a pensioner.

The hon. Gentleman must understand and study the figures carefully and he should also read the writings of thinking people in the Government—there are such people. It is a controversial and dangerous thing to say, but there are Conservative Members who write with knowledge on the subject. They never take part in debates such as this, nor do they sit on Committees. During the past 24 hours, I have copied three pages of a book written by a Government Member for Members of the Committee dealing with incapacity legislation.

Yes, the average income of pensioners has gone up because the rich pensioners have become immensely richer and the poor pensioners have become relatively much poorer. There has been a redistribution of poverty among pensioners.

Dr. Spink

Is it not a fact that, during the last decade or so, poor pensioners have improved their wealth? A greater number of pensioners now have refrigerators, central heating, cars, telephones, videos and television sets. Have not pensioners been increasing their wealth in real terms and their material value during the last decade?

Mr. Flynn

The hon. Gentleman must learn that, under the Conservative Government, those who survive on the basic pension plus a little income support have had their income increased, not along with earnings—the way in which the prosperity of the general population is measured—but in line with prices. In that respect, they have fallen behind every year.

I will give a small example which may not strain the hon. Gentleman too much. The Christmas bonus is a nice, simple example, with easy figures to remember. What should the £10 Christmas bonus be worth now? I have already made the point that, for two years, the Labour Government did not pay the bonus. We failed, and we regret it greatly. The Government have cheated on that bonus on every one of the past 15 years. If the bonus had been increased in line with earnings, it would be £32—three times the value it was when the Labour Government were in power.

The Government have spread what is accepted as the truth by the gullible souls among Conservative Members. There are times when we must have deep sympathy for Government Members. There is a story that soon there will be a line-up of single Government Members with the Chief Whip pointing a shotgun at them. They will all be taken down to the Crypt to have arranged marriages-with suitable women to avoid scandal. That seems to be going a little far, and it is a harsh price to pay for acting as accomplices to the Government's various crimes during the past few years. However, it is their choice, and there must be a time when all the scandals will come to an end.

So shall I come to end. The whole movement in social security benefits during the past 15 years has been one of deception by the Government. There has been a continuous period of cuts and the Government have tried to exaggerate a demographic change which will happen in the next century, but to nothing like the extent that they suggest.

My final point is that there was once a Committee which said that this country could not sustain the benefits system, or continue to pay pensions as it has done. It said that it was crucial that the age of retirement be increased to 63 for women and 68 for men. That was the Phillips committee, which reported in 1954. Its view then was that we could not afford the benefit system. It was as wrong as the view put forward by the Government now that we cannot afford a benefit system in the future. We can, and the will is there. A small amount of growth will allow us to pay for the benefit system, not dismantle it and hand the population over to the greed and waste of the insurance companies.

7.57 pm

Mr. Keith Bradley (Manchester, Withington)

In preparing for tonight's speech, I, like my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) re-read last year's debate. It was interesting that many of the issues of concern that have been raised tonight—as opposed to the general uprating principle with which the Government have complied—have flowed through the past 12 months until today. We are still waiting for the Government to respond effectively to the concerns and the gaps in policy which clearly still remain.

In my winding-up speech last year, I said that the debate had been wide-ranging and thoughtful. Tonight, we have had relatively few speakers but quality has made up for lack of quantity. I welcome the speeches by my hon.Friends the Members for Newport, West (Mr. Flynn) and Strathkelvin and Bearsden (Mr. Galbraith). I welcome, as always, the thought-provoking speech by my hon. Friend the Member for Islington, North (Mr. Corbyn). I cannot promise that all his views will necessarily become party policy, but they will certainly be included in our continuing review and debate during the coming months.

I welcome the speech of the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood), who raised some crucial points that were on record from last year's debate. The points are by no means diminished by that, and they need reinforcing year on year. I particularly welcome his comments about people in residential homes within the preserved rights category. That was raised in the debate last year, and I recommend to the hon. Gentleman the excellent report by the Local Government Information Unit on that group.

That problem clearly has not gone away. Thousands of cases were brought to our attention. The hon. Gentleman says that only a few have been brought to him recently, but I assure him that, throughout Britain, a worried and large group of people want to ensure that their homes will remain their homes and that income support will be paid because their savings have rapidly diminished over the years.

The hon. Member for Roxburgh and Berwickshire also mentioned carers and students. I link with that point the income of 16 and 17-year-olds, who are a forgotten group. Although the Government claim that all 16 and 17-year-olds are guaranteed some sort of training and, therefore, some income, by the Government's own admission, that is not the case. Significant numbers of 16 and 17-year-olds have no income and the Government have made no provision for them to have any income.

Although I welcomed the speech made by the hon. Member for Roxburgh and Berwickshire, I was disappointed with his disingenuous attack on the Labour party for its tactics in the House. It is never my intention to fight like with like and I would never wish to remind the hon. Gentleman that the Liberal Democrats have failed to put any Member on the Standing Committee that is considering the Social Security (Incapacity for Work) Bill to fight that legislation with the Labour party. I would not take that course because I do not believe in disingenuous attacks, but the hon. Gentleman should be more careful about the way in which he approaches such matters with regard to the Labour party.

It has been an interesting and wide-ranging debate. It was relevant that the Secretary of State began by trumpeting and triumphantly stating the claims that he has made about the compensation package for VAT on fuel. The context of the whole debate is clearly the Government's economic problems—the £50 billion public sector borrowing requirement. The Government had to impose VAT on fuel. It has to be remembered that the compensation package was introduced only because there was a massive public outcry against the imposition of VAT on fuel. It was not something which the Government intended to introduce as a natural consequence of their policy.

The compensation package bears a little closer scrutiny, as the hon. Member for Roxburgh and Berwickshire said. It is deeply flawed. The hon. Gentleman rightly mentioned the 2.7 million children who rely on income support. That group will be particularly sold short in this respect. As we know, the compensation package contains two main elements—advance compensation for the average rise in fuel costs reflected in the retail prices index and some recognition of the extra cost faced by pensioners and people with a disability.

For a number of reasons, the package falls far short of adequately protecting people who live in or close to poverty. It is not a waste of the time of the House to identify the losers in the compensation arrangements. For example, the package provides no recognition of the particularly high costs of fuel for people living on low incomes or in poverty.

A study by the Child Poverty Action Group based on calculations from the family expenditure survey in 1992 showed that the poorest 20 per cent. of people spent 11 per cent. of their weekly budget on fuel. That is £10.23 on average a week. In comparison, the top 20 per cent. of earners spent only 3 per cent. of their weekly budget, or £16.28, on fuel. The average expenditure on fuel is 5 per cent. of the weekly budget or £13.02 a week. The regressive nature of VAT on fuel is clearly identified by the disproportionate burden of fuel costs on people on low incomes.

The deeply flawed compensation package does not recognise that families with children have extra heating costs which result from both the heating needs of children and the fact that families with children are likely to spend more time at home. Most important, the compensation package provides no help for people on unemployment benefit. It provides no help to people on low incomes but just above the benefit level. They are on very low incomes, but they receive no compensation under the schemes.

No help whatever is provided for people who fall through the social security net and do not claim their entitlement to social security benefit. It can be argued that they should claim their entitlement, but the complexity of the scheme and people's changing circumstances mean that many people who are entitled to means-tested benefits do not claim. So, yet again, people lose out under the compensation package.

Let us examine what the comparison package means for families with children on income support. It amounts to merely 40p for a couple with one child under 11 per week and only 5p for each extra child. It amounts to only 30p a week for a lone parent with a child under 11 and only 5p for each extra child. Although the Secretary of State is prepared triumphantly to announce the package, those figures show that considerable groups of people will be particularly disadvantaged and will suffer as a consequence of the imposition of VAT on fuel and the compensation arrangements.

It is also worth examining the way in which the compensation package will affect disabled people. It is worth noting—the Secretary of State raised the point again today—that, in his review of the social security budget, one of the groups that the Secretary of State particularly targeted for savings was people with disabilities, in the widest context. He heralded that intention in his Mais lecture and it has been translated into policy initiatives that the Government have taken.

Sticking for the moment to VAT on fuel, it is worth noting that fuel is the most common item of expenditure for disabled people. They use it for heating, for hot water for daily baths and laundry. They use electricity for such items as recharging electric wheelchairs and powering stair lifts put into their homes to help them.

Figures for the average weekly increases in the fuel bills of people with disabilities have been produced by the Disability Alliance. I thank it for its help. The figures show that the extra charges amount to £1.30, rising to £2.80 when the full rate of VAT is payable. That is more than twice as much as the compensatory increases in some benefits. So disabled people, who need to use fuel extensively, will be particularly disadvantaged by the compensation package.

Dr. Spink

Does the hon. Gentleman accept that spending on disability benefits has trebled since 1979? How much more would he spend?

Mr. Bradley

I welcome the hon. Gentleman's assiduous consideration of the debate. If he will allow me to come to the wider point about disability benefits when I deal briefly with incapacity benefit, he will recognise our view on the way in which the Government are cutting the money available for people with disabilities. If he will bear with me, I shall happily give way to him later on that point.

Compensation through the benefits system for the imposition of VAT on fuel will fail many disabled people. Some benefits for disabled people have not been increased. There is no compensatory increase in the disability living allowance. Although many people who receive DLA will receive some compensation through other benefits, those who do not receive other benefits will lose out altogether.

That group includes disabled adults with often small amounts of income from other sources such as occupational pensions. It also includes parents of disabled children who receive disability living allowance but no other benefit. One has to question why that particular group of people has been missed out of the compensation package.

There is no compensatory increase in the standard rate of statutory sick pay. Some benefits have been increased by less than the promised 50p for a single person and 70p for a couple. For example, a single carer receiving invalid care allowance will receive only 20p—35p for a couple—yet invalid care allowance amounts to only 60 per cent. of contributory benefits. Furthermore, there is no evidence that carers' fuel bills are less than those of households receiving other benefits.

The Government seem to have chosen to ignore that group when introducing the VAT compensation scheme and I urge the Under-Secretary of State to reconsider them and find out whether they can be helped, because they will suffer especially from the imposition of VAT on fuel.

While we are talking about disabled people, it is interesting to note that, because of the imposition of VAT on fuel and the compensation package, three benefits—severe disablement allowance, invalid care allowance and severe disability premium—which were paid at the same rate, will now receive different treatment and be paid at different rates. For example, severe disablement allowance has been uprated by VAT compensation of 50p, so the new rate will be £34.80 per week; invalid care allowance has been uprated by VAT compensation of 20p to £34.50 per week; but there is no compensatory increase for severe disability premium, so the new amount is £34.30.

There will therefore be three different rates of payment for benefits that were paid at the same rate. It would also be sensible if the Under-Secretary of State studied the compensation package to ensure that such weekly payments are treated in exactly the same way.

The Government's attempt to reduce social security benefits in the first round of the review of the social security budget has focused on the cost of people on invalidity benefit. The hon. Member for Castle Point (Dr. Spink) was right to say that the cost of invalidity benefit has increased considerably.

I shall not restate the arguments about the Government's previous decisions—notably before the 1987 election, when every Department was asked to find any mechanism possible to take people off the unemployment register. The social security team therefore pushed as many people as possible on to invalidity benefit, which reduced unemployment significantly so that the Government could go into that election saying that unemployment was falling. The then chairman of the Conservative party identified that factor as the crucial indicator to the public of the Tory Administration's competence. The Government set in train the consequences that they must deal with now.

I am not denying that some people are in receipt of invalidity benefit who should not be. We have never questioned that fact. We question strongly, however, whether the new medical test is the right mechanism to assess more sensitively those who are genuinely unable to work. During the coming weeks, we shall argue our case strongly in the Standing Committee of the Social Security (Incapacity for Work) Bill. We strongly disagree with the Government about those disabled people who get through the hoop of the medical test, convince the Government that they are incapable of work but then hit the double whammy—the amount of money available to them is reduced.

If the Government are saying that invalidity benefit payments were reasonable, but that too many people were claiming, how can they say—after reducing the number of people eligible—that the benefit is costing too much money?

Two groups of people in identical circumstances and with identical disabilities can pass the incapacity test, but receive different benefits. As I said, I shall be happy to give way to the hon. Member for Castle Point if he can justify the fact that, under the present invalidity benefit scheme, one receives the full rate of payment after six months, but under the new scheme one will not do so until after 12 months; that under the old scheme, one received additions for adult and child dependants, but under the new scheme, those are severely curtailed; and that under the old scheme, one was entitled to additional pension, but under the new scheme, there is no additional pension. I shall give way to him if he can justify the fact that, although the numbers eligible have been reduced by the new medical test, the amount of money that they receive is also being reduced.

I think that we can understand hon. Members' failure to understand the Government's legislation. They are reducing the number of people eligible for benefit and reducing the amount paid to one of the most vulnerable groups of people. For many months and years—probably for life—such people will have to rely on the new incapacity benefit, but they will receive less money than they were previously entitled to on invalidity benefit. That represents a straight political choice and the Government are using disabled people as a scapegoat for their economic mismanagement and public sector problems.

As my hon. Friend the Member for Garscadden said so effectively, the consequence of that policy will be to reverse the trend that was set in motion before the 1987 election and to push people claiming disability benefit—the new incapacity benefit—back on to unemployment benefit. They have reversed the trend that was used to manipulate the electorate before that election. By the Government's own admission, during the next two years 200,000 of those people will claim unemployment benefit, at a tremendous cost to the social security budget.

Those people will probably fail the medical test by a small margin, but, because of changes to statutory sick pay—the burden is being placed on businesses, which will recruit more carefully—they are less likely to gain employment and more likely to become long-term unemployed. That trend is increasing, as we have seen from the unemployment figures, and Government policies will add to the increase.

I have spent a long time on the subject of disability, but disabled people are often a forgotten group in society and this sort of debate allows us to range widely over their needs. The Minister for Social Security and Disabled People said, quite honestly and openly—I commend him for it—that the number of people receiving disability working allowance had been a disappointment.

From April 1995, people receiving disability working allowance will be eligible for help with their health charges. On 1 December, the Secretary of State said that people on that allowance "will automatically qualify" for such help. However, I understand that those people will have to undergo a savings test and only those with capital of less than £8,000 will qualify for help with the charges. Please could the Under-Secretary of State clarify whether all of them will qualify automatically—as the Secretary of State said—or whether the savings test will be applied and only those who pass it will qualify? Such clarification would be very welcome.

The independent living fund was another significant area of debate last year. One year has gone by and it is clear that many organisations for the disabled and people with disabilities are outraged at the failure of the new fund to meet effectively their real needs. Very few people have received a grant under the scheme and although the Minister with responsibility for the disabled said that the roll-over costs significantly outstrip the new fund's budget, all that proves is how inadequate the fund is.

When the extension fund and the new independent living fund were debated in the House, we highlighted the problem of administration and the fact that money comes from social services up to a cut-off point, at which it is topped up from the fund. That is causing administrative chaos. I urge the Government to look at that again, and particularly at the independent living fund so that it can make direct cash payments to disabled people, in conjunction with care packages drawn up by social services offices, to ensure that real care is provided, and the money can be used effectively, sensitively and imaginatively by recipients of the fund.

The situation is becoming intolerable. In many ways, the fund has no relevance to the way in which the National Health Service and Community Care Act 1990 is being implemented. We urge the Government to think again about the way that they have excluded people over 65, but particularly terminally ill people, from receiving money from the fund.

Under the old system, 34 per cent. of the case load of the independent living fund were people over 65. They have benefited greatly from its provisions. It is outrageous to exclude them and terminally ill people. That is quite unacceptable. I hope that the Government will reconsider the workings, operation and funding of the independent living fund.

It is always relevant to debate the social fund at this time of year, because it is absolutely clear and has been stated year on year since it has been in operation that people are treated differently depending on what day of the year they go through the revolving door to seek help from the fund. If one goes through it on 1 April, one stands some chance of receiving a grant or loan.

At this time of year, the situation is chaotic, and the people—in identical circumstances to those who went through at the beginning of the financial year—are told that there is no opportunity to receive help from the fund. I back up those statements with information that I received from various offices around the country. In Greater Manchester, for example, a note went out from the social fund officers saying: Please find enclosed a copy of your revised guidance on priorities for Social Fund Loans. You will note that, generally speaking, we are only in a position to consider paymetn for high priority items which avoid a risk to health. This situation is likely to continue to the end of this financial year unless more funds are forthcoming. Otherwise we would be heading for a large overspend. Revising the guideline is common in the operation of the social fund. As the year goes on, the money for care grants or loans is prioritised and continually limited. In Greater Manchester at the moment, one has not only to be in a high priority—many categories of people are—but face a risk to one's health. It is almost impossible to get a crucial element, the replacement of the old supplementary payments, which were for essential items such as clothing and household goods to enable people to set up in new home and maintain a certain standard. That is no longer on the agenda. One must have a risk to health, but nothing else.

I have similar statements from other parts of the country. A note was sent to me from the Benefits Agency in Sheffield East. It says: Following legal advice", it had to review the situation on the social fund, but the criteria for which budgeting loans were to be awarded was as a result restricted to situations where there would be severe hardship or serious risk to the health and safety". Again, that limits the priority category to a particular group.

I received a memo from the East Nottinghamshire office of the agency—it could have come from anywhere in the country. It stated quite clearly that only high-priority cases would be considered, and at a later stage those high-priority cases were limited to certain groups within the high-priority category. The Government recognised that there were high priorities, but then limited them as the year went by. That guidance on how social fund officers should operate the scheme is up to date.

The Government have said loudly and clearly that they do not have the budget to meet the needs of people who may be in identical circumstances to those who previously received help from the social fund. I urge the Government to look at the funding through the social fund. They triumphantly announced that people would receive help to top up their meagre benefits through income support. It must be stressed that they are loans and that people must repay them.

People are being given only a limited opportunity—an opportunity they may resist—to take out a loan, which is then taken out of their benefits to repay. Even that system is falling apart at the seams as we enter the last quarter of the financial year.

One or two other points are worth raising. We welcome any attempt by the Government to look at child care costs and the way that child care can be an essential element in trying to enable mothers, particularly, to get back into the workplace. The announcment in the Budget of the disregard in family credit for that purpose is obviously to be welcomed.

I press the Under-Secretary on exactly how much help will be given. On the cost of child care, the £40 disregard and the £28 net element is clearly not enough on a day-to-day basis. They may afford the opportunity for post-school help and perhaps offer some help on a day a week. But if one looks at the real child care costs, anywhere in the country, it is much more realistic to talk about £80, £90 or £100 a week to look after children. Although we welcome the step in the right direction, I urge the Government to look at the reality of their proposals to see whether more can be given.

Lowest-income families already receive maximum family credit. As the arrangements on child care are based on a disregard, if one is already on maximum family credit one clearly cannot receive any more. There is no help with child care costs for the lowest-income families receiving family credit. It seems rather perverse that one does not help those in greatest need.

As the scale increases, only a proportion of the £28 will be available. Will the Under-Secretary of State tell us how many people will receive no help? How many people who receive £28 will receive only £10? How many will receive £20? how many will receive the full £28? That will be an interesting spread within family credit. I hope that he is able to gain that information before he replies. If not, I hope that he will write to me with that information as soon as possible.

We have had a good deal of discussion on statutory sick pay. We have dealt with the amendment from the other place. My hon. Friend the Member for Garscadden asked how it will be dealt with when the Government have completed their consultation process. We raised that when we considered Lords amendments, but we continually seek reassurance on that point because the Government tend to operate by regulation and instrument rather than by primary legislation. We do not want the order to slip through without proper scrutiny and debate.

Dr. Spink

Will the hon. Gentleman give way?

Mr. Bradley

The hon. Gentleman failed to address the issue that I presented to him, so I am reluctant to give way, but since he has sat through my speech quietly, I will be generous.

Dr. Spink

I am grateful to the hon. Gentleman. We all want to help truly vulnerable people as much as we can and the hon. Gentleman has presented us with a wish list of many cost enhancements. Has he costed that list? Does he have authority from his colleagues to propose that additional spending?

Mr. Bradley

I do not believe that I did present a wish list; I was commenting on Government policy. I do not need to cost the social fund, for example, because the Government say that it is self-financing, because it is based on a loan system. The money is paid back.

Dr. Spink

What about child care?

Mr. Bradley

I have cited the social fund as an example. The Government—not I—say that it is self-financing. I do not have to justify asking the Government to put more money into a fund that they claim to be self-financing. That seems reasonable to me. We do not have to make the obvious point about trying desperately not to put more people onto unemployment benefit, which costs an average £9,000 a year in tax and lost benefit per person on the unemployment register. We would try to set the economic conditions that would reduce unemployment and so free resources to fund other essential care and benefit packages.

This has been a worthwhile and interesting debate. We welcome any increases in benefit levels, however meagre they may be. We have expressed our doubts about some benefits that have fallen through the net this time and about the way in which the VAT compensation package has been introduced. We are concerned that some benefits have not been compensated for in the same way as others, which means that certain benefits are no longer in kilter with others. I hope that the Minister can give us some assurance about those benefits.

When we re-run the debate in 12 months' time, I hope that we will not have to raise, yet again, the incredibly important matters of the independent living fund, the social fund, carers, preserved income support for those in residential homes and all those other categories of people who seem to be forgotten continually by the Government.

8.41 pm

The Parliamentary Under-Secretary of State for Social Security (Mr. William Hague)

This has been an interesting debate, as the hon. Member for Manchester, Withington (Mr. Bradley) has pointed out. It has covered a wide range of subjects, some of them even related to the orders before the House, which is always a great consolation.

The hon. Member for Glasgow, Garscadden (Mr. Dewar) opened the debate for the Opposition by saying that the speech by my right hon. Friend the Secretary of State contained few surprises. I had intended to intervene then to say that there would be no surprises in the speech by the hon. Gentleman, but, as it turned out, it did contain one or two surprises.

One of the surprises was that the hon. Member for Garscadden was unable to be very specific in response to questions from my hon. Friends about what Opposition policy might be on certain matters. The hon. Gentleman was asked by my hon. Friend the Member for Colchester, North (Mr. Jenkin) whether the level of social security spending was enough. The answer was rather like a version of, "We wouldn't have started from here." The hon. Gentleman suggested that economic circumstances would be magically different in the future. He suggested that the economic cycle would be abolished and that there would not be unemployment under a Labour Government, so spending priorities could be different. That was not a credible answer.

The hon. Member for Garscadden suggested that a great deal of money was being spent in the wrong way, but he did not go on to say where the sweeping reductions, which were presumably implied by that statement, might be made.

When my right hon. Friend asked the hon. Gentleman about the schemes for pensions proposed by the then Leader of the Opposition, the right hon. Member for Islwyn (Mr. Kinnock), it was surprising that the hon. Gentleman did not feel that he should rule out the means-testing of the pension, or whatever it was that his right hon. Friend proposed.

Mr. Dewar

The Minister has made my point by saying, "or whatever it was". The proposition that he is putting to me is that I should have ruled out my right hon. Friend's suggestion, but I made it clear that I had not had the opportunity to study it. The proposal had been verbally presented on a television programme which I had not seen. I suspect that the Minister is in the same position because he said that I should have ruled out that proposal "whatever it was". That seems an odd position to take up.

Mr. Hague

The right hon. Member for Islwyn (Mr. Kinnock) clearly suggested that there would be some adjustment to the pension as people's incomes rose. To me that is equivalent to means testing, whatever the detail behind the right hon. Gentleman's proposition. We will await the time when the hon. Member for Garscadden receives advice from the Commission for Social Justice in order to clarify that matter.

The hon. Gentleman asked about the guaranteed minimum pension and what discussions may have taken place. The problem of the complexity of that pension and the way in which it interacts with SERPS was raised by the Goode committee as one of the areas in which the Government might seek to simplify arrangements for occupational pension schemes. The Government fell it right to issue a series of consultation papers to take forward discussions on the recommendations of the Goode report.

The Government issued one of their consultation papers about the future of the guaranteed minimum pension, which raised the question of whether there should be an alternative test of how to contract out of SERPS. That alternative test would have to offer security for the rights of occupational pension scheme members. That is what the discussions were about. The Government are now analysing the results of that consultation exercise. If we have any proposals to bring forward as a result, we will do so in due course.

The hon. Member for Garscadden also asked about the guaranteed minimum pension and whether there was any equivalent in personal pensions. There is an equivalent, in that the contracted-out rebate is paid as a minimum contributions into a personal pension. It is then used when a personal pension is turned into an annuity with similar rights to a guaranteed minimum pension.

Mr. Dewar

The Minister is perhaps flattering me, because I said that there was no comparable mechanism in the private pensions sector. I also went on to ask him whether he was satisfied with the present level of regulation, given the problems that have emerged in recent times. Could he address that question?

Mr. Hague

There is an equivalent in that the minimum contributions are paid into personal pensions and personal pensions are turned into an annuity with similar rights in terms of inflation increases up to a certain level, widows' benefits and so on as a guaranteed minimum pension.

The question of regulation is a matter for my right hon. and learned Friend at the Treasury. The Securities and Investments Board is currently reviewing what has happened and the alleged mis-selling of personal pensions. It will produce its findings and thoughts on the matter later in the year.

The hon. Member for Garscadden asked what is happening to statutory sick pay. It is a pity that the hon. Gentleman does not appear to be listening to my answers, but no doubt the hon. Member for Withington will write it all down for him. The Government will consult industry, unions and other interested bodies now that the amendment on it, which was passed in the other place, has been agreed by the House.

The hon. Member referred to the alternative of a two-week period rather than a four-week period for the reimbursement of small employers as costing "only £10 million". We occasionally get such references from the Opposition about things that will "only" cost £10 million. The trouble with tens of millions of pounds is that they add up to rather a lot. If the hon. Gentleman thought it through, I am not sure whether he would consider that alternative an appropriate use of an additional £10 million, especially when small employers and employers in general stand to gain from the changes to statutory sick pay, when the reductions in national insurance contributions are taken into account.

Small employers in particular stand to gain because they tend to have lower sickness rates and they tend to employ many people for whom they are paying the lower rates of employers' national insurance contributions.

Mr. Dewar

The Minister so often tempts me to intervene. However, he is being a little unfair. I said that I considered the figures to be surprisingly low, which illustrates or underlines the fact that only a small percentage of the work force was covered by the provision. Will the Minister give us some idea of what is in the ministerial mind? I recognise that consultation is taking place, but presumably it is a concession granted on the basis that there is a need for action. Is that a fair assumption?

Mr. Hague

The Bill was changed and the Government are consulting industry and trade unions in an effort to make the alternative scheme work. If such a way can be found, we shall lay regulations before the House. If it cannot, there will be a report, as the hon. Gentleman knows. There would be little point in giving a commitment now that there must be a debate on that report if in the meantime employers agreed that for some reason such a scheme would not work. There are many mechanisms in the House and in the other place for securing a debate and no doubt they can be pursued if necessary.

The hon. Gentleman asked about the job seeker's allowance and the reduction from 12 to six months in contributory payments. Two thirds of people who become unemployed leave the count within six months and many of those who remain will be able to claim job seeker's allowance on a means-tested basis or national insurance credits. The measure targets resources on those in need. That is one of the themes that the Government pursue in their reform of the social security system.

The hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) began his speech by saying that he had lost an argument that he was right to lose. That comment could have come only from the Liberal Democrat Bench. I hope that the hon. Gentleman will forgive me for that little unfairness to him.

He talked at some length about pensioners' living standards. That raises the debate which often arises during Question Time and other times in the House about pensioners' living standards which, as one of my hon. Friends observed, have improved by 42 per cent. on average over the past 15 years. The percentage of pensioners in the bottom quintile of income distribution has fallen from 38 per cent. in 1979 to 24 per cent. on the latest figures. Therefore, some of the points that the hon. Member for Newport, West (Mr. Flynn) made earlier are not valid. His comments about pensioners incomes are not true.

In general, pensioners have benefited greatly in the past 15 years. The Government, recognising that not all have shared equally in that, have directed additional resources to those at the bottom of the income scale—£1 billion in extra resources since 1988.

Mr. Kirkwood

I understand the Minister, but in relation to the changes in VAT, relatively small proportions of retired people are suffering terrible adverse financial hardship. What specifically is he doing to address that?

Mr. Hague

As the hon. Gentleman knows, all pensioners are receiving the additional amounts to help with VAT—50p in the first year for single pensioners and 70p a week for couples—a substantial piece of assistance which will pay the lion's share of pensioners' increased fuel bills as a result of value added tax.

Like those on the Opposition Front Bench, the hon. Member for Roxburgh and Berwickshire also implied that social security spending should be higher, but again it is not clear how he proposes to finance it and from where he proposes to take the larger share of the gross domestic product that he would spend on those measures.

The hon. Member raised a number of points about residential care. They are matters for my ministerial colleagues at the Department of Health that I shall draw to their attention. The hon. Member for Strathkelvin and Bearsden (Mr. Galbraith) also raised a number of matters relating to the Department of Health and the Department of Employment. The hon. Member for Islington, North (Mr. Corbyn) who sadly is not with us—

Mr. Dewar

He has been committed.

Mr. Hague

The hon. Member for Garscadden says that his hon. Friend has been committed; I am not sure where.

The hon. Member for Islington, North referred to a caricature of the Government's position as no longer being able to afford the universal pension or the welfare state. That is not the case. The Government's objective is to ensure that the welfare state is sustainable and affordable in future.

Like many Labour Members, he called for the state pension age to be reduced to 60, although that is not the policy of the Opposition Front Bench. I wonder whether the hon. Gentleman considers that to be the best use of £12 billion—that is what it would cost to equalise the state pension age at 60 instead of 65. That money would go to men between 60 and 65, many of whom would still be in employment or have occupational pension schemes in addition to anything they might receive from the state.

Most of the comments of the hon. Member for Strathkelvin and Bearsden referred to my colleagues in other Departments and I shall draw his remarks to their attention. He also made a plea for child benefit to continue. The Government's manifesto commitment to child benefit is clear, but I advise the hon. Gentleman to have a word with his hon. Friends on the Labour Front Bench before the Social Justice Commission concludes its deliberations.

The hon. Member for Newport, West has left the Chamber, so I shall move to some of the other remarks made during the debate.

The hon. Member for Garscadden referred to my right hon. Friend the Secretary of State as interested only in costs and not in a sensible and coherent set of reforms. My right hon. Friend the Secretary of State set out very clear principles for the reform of the social security system: to focus help on those in greatest need, to diminish disincentives, to improve the delivery of benefits, to bear down on fraud and to encourage personal responsibility. The measures that he has announced are in line with that.

The Government's commitment to the system has been shown by our record since 1979. Extra help has been focused on those in greatest need, such as less well-off pensioners, to whom I have referred, and low-income families who have had extra help over the past few years totalling £1 billion. Extra benefits to disabled people have totalled £5 billion since 1978–79 in real terms.

The focus of those policies is continuing with the uprating statement: to be generous to those in need while being realistic about what the nation can afford. The uprating will provide a typical low-income working couple with two children with an increase of £4.30 per week. The income of an unemployed couple with two children will also increase by £4.30 per week; that of an unemployed lone parent with one child will increase by £2.90 per week. A typical unemployed family will be £17 a week better off in real terms, after allowing for inflation, than in 1979.

We should compare that with the record of the Government in the 1970s, when spending on families fell by 7 per cent. in total. They have little right to criticise us on these matters.

Mr. Kirkwood

Where were you in the 1970s?

Mr. Hague

I was at school, but I was watching closely the activities of the Labour Government. I recall writing down these figures at the time.

As my right hon. Friend has described, therefore, we have kept our manifesto pledges to pensioners and to families. We have gone beyond that in providing substantial extra help with the cost of VAT on fuel. We are laying the foundations for reforms of social security which will preserve and sustain it in the future, and in doing so we are moving in step with many other countries of the western world who are also reforming their social security systems; countries throughout the European Community and across the rest of the world.

They are raising contributions in France and in most other member states of the European Community; they are linking the uprating of benefits to prices rather than to wages in the Netherlands, France and Italy; reducing unemployment benefit in Germany, France and Spain and reducing its duration in Denmark and Germany; reducing disability benefits in the Netherlands and Ireland; tightening up on sickness benefits in Italy, Spain and the Netherlands; reforming pensions by raising the pension age in Italy, Portugal, Germany and Greece; freezing family benefits in France and the Netherlands, or targeting them more closely in Germany; tackling fraud in Belgium, France, Germany, the Netherlands and Portugal; and encouraging more private provision of pensions in Italy, Ireland, Greece, Portugal and Spain.

Alone in the European Community, the Labour party is content not to have a policy for the reform and improvement of the social security system and content to make complacent criticisms of Government policy without having an alternative to put in its place. If this is not the right percentage by which to uprate benefits, what is the right percentage? Hon. Members on the Opposition Benches have not told us. If it is not the right way to reform incapacity benefits, what is the right way?

If ours is not the right approach to the state pension age, how would they finance the alternative approaches which they are themselves divided about adopting? If our proposals for ensuring that the social security system can be sustained in the future are not the right ones, what are the alternatives?

The speeches of those on the Opposition Front Bench always draw back from a definitive policy. They always leave the implication that spending would be higher if they were in office, but they are all the time fearful of the brooding presence of the hon. Member for Dunfermline, East (Mr. Brown), who has told them not to make any specific commitments.

We bring to the House tonight orders which provide specifically for the uprating of social security benefits, for the indexation of guaranteed minimum pensions provided by employers, for the reduction of employers' national insurance contributions, for a new system of assisting small employers with the cost of statutory sick pay; and we do so in the context of policies that will ensure that our social security system is affordable and well targeted in the future. They are policies which are realistic and well judged, to which no alternative has been expressed in the debate and which we are confident will therefore enjoy the approval of the House.

Question put:—

The House divided: Ayes 228, Noes 53.

Division No. 129]	[9.01 pm
AYES
Ainsworth, Peter (East Surrey)	Colvin, Michael
Alison, Rt Hon Michael (Selby)	Congdon, David
Allason, Rupert (Torbay)	Conway, Derek
Arbuthnot, James	Coombs, Simon (Swindon)
Arnold, Jacques (Gravesham)	Cope, Rt Hon Sir John
Arnold, Sir Thomas (Hazel Grv)	Currie, Mrs Edwina (S D'by'ire)
Ashby, David	Day, Stephen
Atkinson, David (Bour'mouth E)	Deva, Nirj Joseph
Atkinson, Peter (Hexham)	Devlin, Tim
Baker, Nicholas (Dorset North)	Douglas-Hamilton, Lord James
Baldry, Tony	Dover, Den
Banks, Matthew (Southport)	Duncan, Alan
Batiste, Spencer	Duncan-Smith, Iain
Bellingham, Henry	Dunn, Bob
Bendall, Vivian	Durant, Sir Anthony
Beresford, Sir Paul	Elletson, Harold
Biffen, Rt Hon John	Evans, Jonathan (Brecon)
Blackburn, Dr John G.	Evans, Roger (Monmouth)
Bonsor, Sir Nicholas	Faber, David
Boswell, Tim	Fabricant, Michael
Bottomley, Peter (Eltham)	Fenner, Dame Peggy
Bottomley, Rt Hon Virginia	Fishburn, Dudley
Bowden, Andrew	Forman, Nigel
Bowis, John	Forsyth, Michael (Stirling)
Boyson, Rt Hon Sir Rhodes	Forsythe, Clifford (Antrim S)
Brandreth, Gyles	Forth, Eric
Brazier, Julian	Fox, Dr Liam (Woodspring)
Bright, Graham	Fox, Sir Marcus (Shipley)
Brown, M. (Brigg & Cl'thorpes)	Freeman, Rt Hon Roger
Browning, Mrs. Angela	French, Douglas
Bruce, Ian (S Dorset)	Fry, Sir Peter
Burns, Simon	Gale, Roger
Burt, Alistair	Gallie, Phil
Butcher, John	Gardiner, Sir George
Butler, Peter	Garel-Jones, Rt Hon Tristan
Butterfill, John	Gill, Christopher
Campbell, Menzies (Fife NE)	Gillan, Cheryl
Carlisle, John (Luton North)	Gorman, Mrs Teresa
Carlisle, Kenneth (Lincoln)	Griffiths, Peter (Portsmouth, N)
Carrington, Matthew	Grylls, Sir Michael
Carttiss, Michael	Hague, William
Cash, William	Hamilton, Rt Hon Sir Archie
Chapman, Sydney	Hamilton, Neil (Tatton)
Clappison, James	Hampson, Dr Keith
Clifton-Brown, Geoffrey	Hannam, Sir John
Coe, Sebastian	Hargreaves, Andrew

Harris, David	Porter, David (Waveney)
Hawkins, Nick	Renton, Rt Hon Tim
Hawksley, Warren	Richards, Rod
Hayes, Jerry	Riddick, Graham
Hendry, Charles	Robathan, Andrew
Howarth, Alan (Strat'rd-on-A)	Roberts, Rt Hon Sir Wyn
Howell, Rt Hon David (G'dford)	Robertson, Raymond (Ab'd'n S)
Howell, Sir Ralph (N Norfolk)	Robinson, Mark (Somerton)
Hughes, Simon (Southwark)	Roe, Mrs Marion (Broxbourne)
Hunter, Andrew	Ross, William (E Londonderry)
Jack, Michael	Rumbold, Rt Hon Dame Angela
Jackson, Robert (Wantage)	Scott, Rt Hon Nicholas
Jenkin, Bernard	Shaw, David (Dover)
Johnson Smith, Sir Geoffrey	Shaw, Sir Giles (Pudsey)
Jones, Nigel (Cheltenham)	Shephard, Rt Hon Gillian
Jones, Robert B. (W Hertfdshr)	Shepherd, Colin (Hereford)
Kennedy, Charles (Ross, C&S)	Shersby, Michael
King, Rt Hon Tom	Sims, Roger
Kirkhope, Timothy	Smith, Sir Dudley (Warwick)
Kirkwood, Archy	Smith, Tim (Beaconsfield)
Knapman, Roger	Soames, Nicholas
Knight, Mrs Angela (Erewash)	Spicer, Sir James (W Dorset)
Knight, Greg (Derby N)	Spicer, Michael (S Worcs)
Knight, Dame Jill (Bir'm E'st'n)	Spink, Dr Robert
Knox, Sir David	Spring, Richard
Lait, Mrs Jacqui	Squire, Robin (Hornchurch)
Lamont, Rt Hon Norman	Stanley, Rt Hon Sir John
Lawrence, Sir Ivan	Steen, Anthony
Legg, Barry	Stephen, Michael
Leigh, Edward	Stern, Michael
Lennox-Boyd, Mark	Sumberg, David
Lester, Jim (Broxtowe)	Sweeney, Walter
Lidington, David	Sykes, John
Lightbown, David	Taylor, Ian (Esher)
Lilley, Rt Hon Peter	Taylor, Rt Hon John D. (Strgfd)
Lloyd, Rt Hon Peter (Fareham)	Taylor, John M. (Solihull)
Lord, Michael	Taylor, Sir Teddy (Southend, E)
Lynne, Ms Liz	Temple-Morris, Peter
MacGregor, Rt Hon John	Thomason, Roy
MacKay, Andrew	Thompson, Sir Donald (C'er V)
Maclean, David	Thompson, Patrick (Norwich N)
McLoughlin, Patrick	Thornton, Sir Malcolm
McNair-Wilson, Sir Patrick	Thurnham, Peter
Maddock, Mrs Diana	Townend, John (Bridlington)
Maginnis, Ken	Townsend, Cyril D. (Bexl'yh'th)
Maitland, Lady Olga	Tracey, Richard
Mans, Keith	Trend, Michael
Marland, Paul	Trimble, David
Mawhinney, Rt Hon Dr Brian	Vaughan, Sir Gerard
Merchant, Piers	Viggers, Peter
Mills, Iain	Walden, George
Mitchell, Andrew (Gedling)	Walker, Bill (N Tayside)
Mitchell, Sir David (Hants NW)	Wallace, James
Monro, Sir Hector	Ward, John
Montgomery, Sir Fergus	Wardle, Charles (Bexhill)
Moss, Malcolm	Waterson, Nigel
Needham, Richard	Watts, John
Nelson, Anthony	Wells, Bowen
Neubert, Sir Michael	Wheeler, Rt Hon Sir John
Newton, Rt Hon Tony	Whitney, Ray
Nicholls, Patrick	Whittingdale, John
Nicholson, Emma (Devon West)	Widdecombe, Ann
Norris, Steve	Willetts, David
Onslow, Rt Hon Sir Cranley	Wood, Timothy
Ottaway, Richard	Yeo, Tim
Page, Richard	Young, Rt Hon Sir George
Paice, James
Pawsey, James	Tellers for the Ayes:
Peacock, Mrs Elizabeth	Mr. Robert G. Hughes and Mr. Irvine Patnick.
Pickles, Eric

NOES
Ainsworth, Robert (Cov'try NE)	Campbell-Savours, D. N.
Barnes, Harry	Chisholm, Malcolm
Bayley, Hugh	Connarty, Michael
Benn, Rt Hon Tony	Corbyn, Jeremy
Byers, Stephen	Cryer, Bob
Callaghan, Jim	Davies, Rt Hon Denzil (Llanelli)
Campbell, Mrs Anne (C'bridge)	Dixon, Don
Campbell, Ronnie (Blyth V)	Dowd, Jim

Dunwoody, Mrs Gwyneth	Michie, Bill (Sheffield Heeley)
Etherington, Bill	Morgan, Rhodri
Flynn, Paul	Mudie, George
Galbraith, Sam	Mullin, Chris
Gapes, Mike	O'Brien, Michael (N W'kshire)
Godman, Dr Norman A.	O'Hara, Edward
Hogg, Norman (Cumbernauld)	Olner, William
Home Robertson, John	Parry, Robert
Hood, Jimmy	Patchett, Terry
Jones, Barry (Alyn and D'side)	Powell, Ray (Ogmore)
Livingstone, Ken	Prentice, Ms Bridget (Lew'm E)
McAvoy, Thomas	Skinner, Dennis
Macdonald, Calum	Soley, Clive
McMaster, Gordon	Spellar, John
McWilliam, John	Thompson, Jack (Wansbeck)
Madden, Max	Wise, Audrey
Mahon, Alice
Marek, Dr John	Tellers for the Noes:
Marshall, Jim (Leicester, S)	Mr. Terry Lewis and Mr. Jim Cunningham.
Martin, Michael J. (Springburn)
Meale, Alan

Question accordingly agreed to.

Resolved, That the draft Guaranteed Minimum Pensions Increase Order 1994, which was laid before this House on 10th February, be approved.

Motion made, and Question proposed,

That the draft Social Security Benefits Up-rating Order 1994, which was laid before this House on 10th February, be approved.—[Mr. Andrew Mitchell.]

The House proceeded to a Division—

Sir Teddy Taylor (Southend, East)

(seated and covered): On a point of order, Mr. Deputy Speaker. In the event of the motion being defeated, would it be possible to allow an emergency debate to assist my pensioners in Southend? I understand that the Opposition are now voting to stop a pension increase greatly needed by poor people.

Mr. Jacques Arnold (Gravesham)

Why are Labour blocking it?

Sir Teddy Taylor

(seated and covered): If the increase is blocked, there will be huge hardship for pensioners in Southend and throughout the country. If the Opposition win the vote, may we have an emergency debate about what we can do to help the pensioners deprived of their pension increase?

Mr. Arnold

Pensioners of Jarrow.

Sir Teddy Taylor

(seated and covered): This is a serious question.

Mr. Arnold

Jarrow pensioners.

Sir Teddy Taylor

(seated and covered): Pensioners are having a difficult time these days—

Mr. Arnold

Why are Labour trying to block the pension increase?

Sir Teddy Taylor

(seated and covered): Please keep quiet. [Interruption.] This is serious; this is not funny.

Mr. Arnold

We are being serious.

Mr. Deputy Speaker (Mr. Michael Morris)

Order. The hon. Member for Southend, East (Sir T. Taylor) well knows that the Chair never anticipates a situation.

Sir Teddy Taylor

(seated and covered): This is a very serious matter, Mr. Deputy Speaker.

Mr. Deputy Speaker

I accept that it is an entirely serious matter, but the point is that the Chair does not anticipate a situation. Let us see whether that situation evolves.

Mr. Matthew Banks (Southport)

(seated and covered): On a point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker

Is it a new point of order?

Mr. Banks

(seated and covered): Yes, Mr. Deputy Speaker. May I ask you for an emergency debate to discuss the motion before us, and that which the House voted on a few moments ago, concerning the fact that Labour Members, with the apparent connivance of the Opposition Chief Whip, have been voting against the uprating of social security benefits and against pension increases in general?

Mr. Deputy Speaker

I have to draw the hon. Gentleman's attention to the fact that we are voting on motion No. 3 on the Order Paper. That is all that we are doing at the moment. Anything else is pure conjecture.

Mr. Banks

(seated and covered: With respect, Mr. Deputy Speaker, I am referring to—

Mr. Deputy Speaker

With or without respect, that is my ruling.

The House having divided: Ayes 231, Noes 50.

Division No. 130]	[9.15 pm
AYES
Ainsworth, Peter (East Surrey)	Conway, Derek
Alison, Rt Hon Michael (Selby)	Coombs, Simon (Swindon)
Allason, Rupert (Torbay)	Cope, Rt Hon Sir John
Arbuthnot, James	Currie, Mrs Edwina (S D'by'ire)
Arnold, Jacques (Gravesham)	Davies, Quentin (Stamford)
Arnold, Sir Thomas (Hazel Grv)	Day, Stephen
Ashby, David	Deva, Nirj Joseph
Atkinson, David (Bour'mouth E)	Devlin, Tim
Atkinson, Peter (Hexham)	Douglas-Hamilton, Lord James
Baker, Nicholas (Dorset North)	Dover, Den
Baldry, Tony	Duncan, Alan
Banks, Matthew (Southport)	Duncan-Smith, Iain
Bellingham, Henry	Dunn, Bob
Bendall, Vivian	Durant, Sir Anthony
Beresford, Sir Paul	Elletson, Harold
Biffen, Rt Hon John	Evans, Jonathan (Brecon)
Blackburn, Dr John G.	Evans, Nigel (Ribble Valley)
Bonsor, Sir Nicholas	Evans, Roger (Monmouth)
Boswell, Tim	Faber, David
Bottomley, Peter (Eltham)	Fabricant, Michael
Bowden, Andrew	Fenner, Dame Peggy
Bowis, John	Fishburn, Dudley
Boyson, Rt Hon Sir Rhodes	Forman, Nigel
Brandreth, Gyles	Forsyth, Michael (Stirling)
Brazier, Julian	Forsythe, Clifford (Antrim S)
Bright, Graham	Forth, Eric
Brown, M. (Brigg & Cl'thorpes)	Fox, Dr Liam (Woodspring)
Browning, Mrs. Angela	Fox, Sir Marcus (Shipley)
Bruce, Ian (S Dorset)	Freeman, Rt Hon Roger
Burns, Simon	French, Douglas
Burt, Alistair	Fry, Sir Peter
Butcher, John	Gale, Roger
Butler, Peter	Gallie, Phil
Butterfill, John	Gardiner, Sir George
Campbell, Menzies (Fife NE)	Garel-Jones, Rt Hon Tristan
Carlisle, John (Luton North)	Gill, Christopher
Carlisle, Kenneth (Lincoln)	Gillan, Cheryl
Carrington, Matthew	Gorman, Mrs Teresa
Carttiss, Michael	Greenway, Harry (Ealing N)
Cash, William	Greenway, John (Ryedale)
Clappison, James	Griffiths, Peter (Portsmouth, N)
Clifton-Brown, Geoffrey	Grylls, Sir Michael
Coe, Sebastian	Hague, William
Colvin, Michael	Hamilton, Rt Hon Sir Archie
Congdon, David	Hamilton, Neil (Tatton)

Hampson, Dr Keith	Pickles, Eric
Hannam, Sir John	Porter, David (Waveney)
Hargreaves, Andrew	Renton, Rt Hon Tim
Harris, David	Richards, Rod
Hawkins, Nick	Riddick, Graham
Hawksley, Warren	Robathan, Andrew
Hayes, Jerry	Roberts, Rt Hon Sir Wyn
Hendry, Charles	Robertson, Raymond (Ab'd'n S)
Howarth, Alan (Strat'rd-on-A)	Robinson, Mark (Somerton)
Howell, Rt Hon David (G'dford)	Roe, Mrs Marion (Broxbourne)
Howell, Sir Ralph (N Norfolk)	Ross, William (E Londonderry)
Hughes Robert G. (Harrow W)	Rumbold, Rt Hon Dame Angela
Hunter, Andrew	Scott, Rt Hon Nicholas
Jack, Michael	Shaw, David (Dover)
Jackson, Robert (Wantage)	Shaw, Sir Giles (Pudsey)
Jenkin, Bernard	Shephard, Rt Hon Gillian
Johnson Smith, Sir Geoffrey	Shepherd, Colin (Hereford)
Jones, Nigel (Cheltenham)	Shersby, Michael
Jones, Robert B. (W Hertfdshr)	Sims, Roger
King, Rt Hon Tom	Smith, Sir Dudley (Warwick)
Kirkhope, Timothy	Smith, Tim (Beaconsfield)
Knapman, Roger	Soames, Nicholas
Knight, Mrs Angela (Erewash)	Speed, Sir Keith
Knight, Greg (Derby N)	Spicer, Sir James (W Dorset)
Knight, Dame Jill (Bir'm E'st'n)	Spicer, Michael (S Worcs)
Knox, Sir David	Spink, Dr Robert
Kynoch, George (Kincardine)	Spring, Richard
Lait, Mrs Jacqui	Squire, Robin (Hornchurch)
Lamont, Rt Hon Norman	Stanley, Rt Hon Sir John
Lawrence, Sir Ivan	Steen, Anthony
Legg, Barry	Stephen, Michael
Leigh, Edward	Stern, Michael
Lennox-Boyd, Mark	Sumberg, David
Lester, Jim (Broxtowe)	Sweeney, Walter
Lidington, David	Sykes, John
Lightbown, David	Taylor, Ian (Esher)
Lilley, Rt Hon Peter	Taylor, Rt Hon John D. (Strgfd)
Lloyd, Rt Hon Peter (Fareham)	Taylor, John M. (Solihull)
Lord, Michael	Taylor, Sir Teddy (Southend, E)
Lynne, Ms Liz	Temple-Morris, Peter
MacGregor, Rt Hon John	Thomason, Roy
MacKay, Andrew	Thompson, Sir Donald (C'er V)
Maclean, David	Thompson, Patrick (Norwich N)
McLoughlin, Patrick	Thornton, Sir Malcolm
McNair-Wilson, Sir Patrick	Thurnham, Peter
Maddock, Mrs Diana	Townend, John (Bridlington)
Maitland, Lady Olga	Townsend, Cyril D. (Bexl'yh'th)
Malone, Gerald	Tracey, Richard
Mans, Keith	Trend, Michael
Marland, Paul	Vaughan, Sir Gerard
Mawhinney, Rt Hon Dr Brian	Viggers, Peter
Merchant, Piers	Walden, George
Mills, Iain	Walker, Bill (N Tayside)
Mitchell, Andrew (Gedling)	Wallace, James
Mitchell, Sir David (Hants NW)	Ward, John
Monro, Sir Hector	Wardle, Charles (Bexhill)
Montgomery, Sir Fergus	Waterson, Nigel
Moss, Malcolm	Watts, John
Needham, Richard	Wells, Bowen
Nelson, Anthony	Wheeler, Rt Hon Sir John
Neubert, Sir Michael	Whitney, Ray
Newton, Rt Hon Tony	Whittingdale, John
Nicholls, Patrick	Widdecombe, Ann
Nicholson, Emma (Devon West)	Willetts, David
Norris, Steve	Wood, Timothy
Onslow, Rt Hon Sir Cranley	Yeo, Tim
Ottaway, Richard	Young, Rt Hon Sir George
Page, Richard
Paice, James	Tellers for the Ayes:
Paisley, Rev Ian	Mr. Sydney Chapman and Mr. Irvine Patnick.
Pawsey, James
Peacock, Mrs Elizabeth

NOES
Ainsworth, Robert (Cov'try NE)	Campbell, Ronnie (Blyth V)
Barnes, Harry	Campbell-Savours, D. N.
Bayley, Hugh	Canavan, Dennis
Benn, Rt Hon Tony	Chisholm, Malcolm
Callaghan, Jim	Connarty, Michael
Campbell, Mrs Anne (C'bridge)	Corbyn, Jeremy

Cox, Tom	Madden, Max
Cunningham, Jim (Covy SE)	Mahon, Alice
Davies, Rt Hon Denzil (Llanelli)	Marek, Dr John
Dixon, Don	Marshall, Jim (Leicester, S)
Dowd, Jim	Martin, Michael J. (Springburn)
Etherington, Bill	Meale, Alan
Flynn, Paul	Michie, Bill (Sheffield Heeley)
Galbraith, Sam	Mudie, George
Gapes, Mike	Mullin, Chris
George, Bruce	Olner, William
Godman, Dr Norman A.	Parry, Robert
Gunnell, John	Patchett, Terry
Hogg, Norman (Cumbernauld)	Pike, Peter L.
Home Robertson, John	Powell, Ray (Ogmore)
Hood, Jimmy	Prentice, Ms Bridget (Lew'm E)
Jones, Barry (Alyn and D'side)	Spellar, John
Lewis, Terry	Wise, Audrey
Lloyd, Tony (Stretford)
McAvoy, Thomas	Tellers for the Noes:
Macdonald, Calum	Mr. Bob Cryer and Mr. Dennis Skinner.
McMaster, Gordon

Question accordingly agreed to.

Motion made, and Question put,

That the Draft Statutory Sick Pay (Small Employers' Relief) Amendment Regulations 1994, which were laid before this House on 10th February, be approved—[Mr. Andrew Mitchell.]

The House proceeded to a Division—

Mr. David Lidington (Aylesbury)

(seated and covered): On a point of order, Mr. Deputy Speaker. I have always understood it to be the procedure in the House that votes had to follow the voices. Will you therefore rule on whether it is in order for Opposition Members who have called with their voices for compensation for VAT now to vote against that compensation, presumably on the ground that it is more than the 50p a week, which they regard as adequate?

Mr. Deputy Speaker

Voices on a Division are specific to that Division.

The House having divided: Ayes 227, Noes 52.

Division No. 131]	[9.26 pm
AYES
Ainsworth, Peter (East Surrey)	Butterfill, John
Alison, Rt Hon Michael (Selby)	Campbell, Menzies (Fife NE)
Allason, Rupert (Torbay)	Carlisle, John (Luton North)
Arbuthnot, James	Carrington, Matthew
Arnold, Jacques (Gravesham)	Carttiss, Michael
Arnold, Sir Thomas (Hazel Grv)	Cash, William
Ashby, David	Channon, Rt Hon Paul
Atkinson, David (Bour'mouth E)	Chapman, Sydney
Atkinson, Peter (Hexham)	Clappison, James
Baker, Nicholas (Dorset North)	Clifton-Brown, Geoffrey
Baldry, Tony	Coe, Sebastian
Banks, Matthew (Southport)	Colvin, Michael
Bellingham, Henry	Congdon, David
Bendall, Vivian	Conway, Derek
Beresford, Sir Paul	Coombs, Simon (Swindon)
Biffen, Rt Hon John	Cope, Rt Hon Sir John
Blackburn, Dr John G.	Currie, Mrs Edwina (S D'by'ire)
Bonsor, Sir Nicholas	Davies, Quentin (Stamford)
Boswell, Tim	Day, Stephen
Bottomley, Peter (Eltham)	Deva, Nirj Joseph
Bottomley, Rt Hon Virginia	Douglas-Hamilton, Lord James
Bowden, Andrew	Dover, Den
Bowis, John	Duncan, Alan
Boyson, Rt Hon Sir Rhodes	Duncan-Smith, Iain
Brandreth, Gyles	Dunn, Bob
Brazier, Julian	Durant, Sir Anthony
Browning, Mrs. Angela	Elletson, Harold
Bruce, Ian (S Dorset)	Evans, Jonathan (Brecon)
Burns, Simon	Evans, Nigel (Ribble Valley)
Burt, Alistair	Evans, Roger (Monmouth)
Butcher, John	Faber, David
Butler, Peter	Fabricant, Michael

Fenner, Dame Peggy	Montgomery, Sir Fergus
Fishburn, Dudley	Nelson, Anthony
Forman, Nigel	Neubert, Sir Michael
Forsyth, Michael (Stirling)	Newton, Rt Hon Tony
Forsythe, Clifford (Antrim S)	Nicholls, Patrick
Forth, Eric	Nicholson, Emma (Devon West)
Fox, Dr Liam (Woodspring)	Onslow, Rt Hon Sir Cranley
Fox, Sir Marcus (Shipley)	Oppenheim, Phillip
Freeman, Rt Hon Roger	Ottaway, Richard
French, Douglas	Page, Richard
Fry, Sir Peter	Paice, James
Gale, Roger	Paisley, Rev Ian
Gallie, Phil	Patnick, Irvine
Gardiner, Sir George	Pawsey, James
Garel-Jones, Rt Hon Tristan	Peacock, Mrs Elizabeth
Gill, Christopher	Pickles, Eric
Gillan, Cheryl	Porter, David (Waveney)
Gorman, Mrs Teresa	Rendel, David
Greenway, Harry (Ealing N)	Renton, Rt Hon Tim
Greenway, John (Ryedale)	Richards, Rod
Griffiths, Peter (Portsmouth, N)	Riddick, Graham
Grylls, Sir Michael	Robathan, Andrew
Hague, William	Roberts, Rt Hon Sir Wyn
Hamilton, Rt Hon Sir Archie	Robertson, Raymond (Ab'd'n S)
Hamilton, Neil (Tatton)	Robinson, Mark (Somerton)
Hampson, Dr Keith	Roe, Mrs Marion (Broxbourne)
Hannam, Sir John	Ross, William (E Londonderry)
Hargreaves, Andrew	Rumbold, Rt Hon Dame Angela
Harris, David	Scott, Rt Hon Nicholas
Hawkins, Nick	Shaw, David (Dover)
Hawksley, Warren	Shaw, Sir Giles (Pudsey)
Hayes, Jerry	Shephard, Rt Hon Gillian
Hendry, Charles	Shepherd, Colin (Hereford)
Howarth, Alan (Strat'rd-on-A)	Shersby, Michael
Howell, Rt Hon David (G'dford)	Sims, Roger
Howell, Sir Ralph (N Norfolk)	Smith, Sir Dudley (Warwick)
Hughes Robert G. (Harrow W)	Smith, Tim (Beaconsfield)
Hunter, Andrew	Soames, Nicholas
Jack, Michael	Speed, Sir Keith
Jackson, Robert (Wantage)	Spicer, Sir James (W Dorset)
Jenkin, Bernard	Spicer, Michael (S Worcs)
Johnson Smith, Sir Geoffrey	Spink, Dr Robert
Jones, Nigel (Cheltenham)	Spring, Richard
Jones, Robert B. (W Hertfdshr)	Squire, Robin (Hornchurch)
King, Rt Hon Tom	Stanley, Rt Hon Sir John
Knapman, Roger	Steen, Anthony
Knight, Mrs Angela (Erewash)	Stephen, Michael
Knight, Greg (Derby N)	Stern, Michael
Knight, Dame Jill (Bir'm E'st'n)	Stewart, Allan
Knox, Sir David	Sweeney, Walter
Kynoch, George (Kincardine)	Sykes, John
Lait, Mrs Jacqui	Taylor, Ian (Esher)
Lamont, Rt Hon Norman	Taylor, Rt Hon John D. (Strgfd)
Lawrence, Sir Ivan	Taylor, John M. (Solihull)
Legg, Barry	Taylor, Sir Teddy (Southend, E)
Leigh, Edward	Temple-Morris, Peter
Lennox-Boyd, Mark	Thomason, Roy
Lester, Jim (Broxtowe)	Thompson, Sir Donald (C'er V)
Lidington, David	Thompson, Patrick (Norwich N)
Lightbown, David	Thornton, Sir Malcolm
Lilley, Rt Hon Peter	Thurnham, Peter
Lloyd, Rt Hon Peter (Fareham)	Townend, John (Bridlington)
Lord, Michael	Townsend, Cyril D. (Bexl'yh'th)
Lynne, Ms Liz	Tracey, Richard
MacGregor, Rt Hon John	Trend, Michael
MacKay, Andrew	Vaughan, Sir Gerard
Maclean, David	Viggers, Peter
McLoughlin, Patrick	Walden, George
McNair-Wilson, Sir Patrick	Walker, Bill (N Tayside)
Maddock, Mrs Diana	Wallace, James
Maginnis, Ken	Ward, John
Maitland, Lady Olga	Wardle, Charles (Bexhill)
Malone, Gerald	Waterson, Nigel
Mans, Keith	Watts, John
Marland, Paul	Wells, Bowen
Mawhinney, Rt Hon Dr Brian	Wheeler, Rt Hon Sir John
Merchant, Piers	Whitney, Ray
Mills, Iain	Whittingdale, John
Mitchell, Andrew (Gedling)	Widdecombe, Ann
Mitchell, Sir David (Hants NW)	Willetts, David

Wood, Timothy	Tellers for the Ayes:
Yeo, Tim	Mr. Timothy Kirkhope and Mr. Michael Brown.
Young, Rt Hon Sir George

NOES
Ainsworth, Robert (Cov'try NE)	Jones, Barry (Alyn and D'side)
Barnes, Harry	McAvoy, Thomas
Bayley, Hugh	Macdonald, Calum
Benn, Rt Hon Tony	McMaster, Gordon
Boateng, Paul	McWilliam, John
Callaghan, Jim	Madden, Max
Campbell, Mrs Anne (C'bridge)	Mahon, Alice
Campbell, Ronnie (Blyth V)	Marek, Dr John
Canavan, Dennis	Marshall, Jim (Leicester, S)
Chisholm, Malcolm	Martin, Michael J. (Springburn)
Clarke, Eric (Midlothian)	Meale, Alan
Connarty, Michael	Michie, Bill (Sheffield Heeley)
Corbyn, Jeremy	Mudie, George
Cox, Tom	Mullin, Chris
Cryer, Bob	O'Hara, Edward
Cunningham, Jim (Covy SE)	Olner, William
Dixon, Don	Parry, Robert
Dowd, Jim	Patchett, Terry
Etherington, Bill	Pike, Peter L.
Flynn, Paul	Powell, Ray (Ogmore)
Galbraith, Sam	Prentice, Ms Bridget (Lew'm E)
Gapes, Mike	Skinner, Dennis
George, Bruce	Spellar, John
Godman, Dr Norman A.	Wise, Audrey
Gunnell, John
Hogg, Norman (Cumbernauld)	Tellers for the Noes:
Home Robertson, John	Mr. Dale Campbell-Savours and Mr. Terry Lewis.
Hood, Jimmy

Question accordingly agreed to.

Motion made, and Question put,

That the Draft Statutory Sick Pay (Small Employers' Relief) Amendment Regulations 1994, which were laid before this House on 10th February, be approved—[Mr. Andrew Mitchell.]

The House having divided: Ayes 221, Noes 46.

Division No. 132]	[9.37 pm
AYES
Ainsworth, Peter (East Surrey)	Carttiss, Michael
Alison, Rt Hon Michael (Selby)	Cash, William
Allason, Rupert (Torbay)	Channon, Rt Hon Paul
Alton, David	Chapman, Sydney
Arbuthnot, James	Clappison, James
Arnold, Jacques (Gravesham)	Clifton-Brown, Geoffrey
Arnold, Sir Thomas (Hazel Grv)	Coe, Sebastian
Ashby, David	Colvin, Michael
Atkinson, David (Bour'mouth E)	Congdon, David
Atkinson, Peter (Hexham)	Conway, Derek
Baker, Nicholas (Dorset North)	Coombs, Simon (Swindon)
Baldry, Tony	Cope, Rt Hon Sir John
Banks, Matthew (Southport)	Currie, Mrs Edwina (S D'by'ire)
Beggs, Roy	Davies, Quentin (Stamford)
Bellingham, Henry	Day, Stephen
Bendall, Vivian	Deva, Nirj Joseph
Beresford, Sir Paul	Devlin, Tim
Blackburn, Dr John G.	Douglas-Hamilton, Lord James
Bonsor, Sir Nicholas	Dover, Den
Boswell, Tim	Duncan, Alan
Bottomley, Peter (Eltham)	Duncan-Smith, Iain
Bowden, Andrew	Dunn, Bob
Bowis, John	Durant, Sir Anthony
Boyson, Rt Hon Sir Rhodes	Elletson, Harold
Brandreth, Gyles	Evans, Jonathan (Brecon)
Brazier, Julian	Evans, Nigel (Ribble Valley)
Browning, Mrs. Angela	Evans, Roger (Monmouth)
Bruce, Ian (S Dorset)	Faber, David
Burns, Simon	Fabricant, Michael
Burt, Alistair	Fenner, Dame Peggy
Butler, Peter	Fishburn, Dudley
Butterfill, John	Forman, Nigel
Campbell, Menzies (Fife NE)	Forsyth, Michael (Stirling)
Carlisle, John (Luton North)	Forsythe, Clifford (Antrim S)
Carrington, Matthew	Forth, Eric

Fox, Dr Liam (Woodspring)	Page, Richard
Freeman, Rt Hon Roger	Paice, James
French, Douglas	Patnick, Irvine
Fry, Sir Peter	Pawsey, James
Gale, Roger	Peacock, Mrs Elizabeth
Gallie, Phil	Pickles, Eric
Gardiner, Sir George	Porter, David (Waveney)
Garel-Jones, Rt Hon Tristan	Rendel, David
Gill, Christopher	Renton, Rt Hon Tim
Gillan, Cheryl	Richards, Rod
Gorman, Mrs Teresa	Riddick, Graham
Greenway, Harry (Eating N)	Robathan, Andrew
Greenway, John (Ryedale)	Roberts, Rt Hon Sir Wyn
Griffiths, Peter (Portsmouth, N)	Robertson, Raymond (Ab'd'n S)
Grylls, Sir Michael	Robinson, Mark (Somerton)
Hague, William	Roe, Mrs Marion (Broxbourne)
Hamilton, Rt Hon Sir Archie	Rumbold, Rt Hon Dame Angela
Hamilton, Neil (Tatton)	Scott, Rt Hon Nicholas
Hampson, Dr Keith	Shaw, David (Dover)
Hannam, Sir John	Shaw, Sir Giles (Pudsey)
Hargreaves, Andrew	Shephard, Rt Hon Gillian
Harris, David	Shepherd, Colin (Hereford)
Hawkins, Nick	Shersby, Michael
Hayes, Jerry	Sims, Roger
Hendry, Charles	Smith, Sir Dudley (Warwick)
Howarth, Alan (Strat'rd-on-A)	Smith, Tim (Beaconsfield)
Howell, Rt Hon David (G'dford)	Soames, Nicholas
Howell, Sir Ralph (N Norfolk)	Speed, Sir Keith
Hughes Robert G. (Harrow W)	Spicer, Sir James (W Dorset)
Hunter, Andrew	Spink, Dr Robert
Jack, Michael	Spring, Richard
Jackson, Robert (Wantage)	Squire, Robin (Hornchurch)
Jenkin, Bernard	Stanley, Rt Hon Sir John
Jones, Nigel (Cheltenham)	Stephen, Michael
Jones, Robert B. (W Hertfdshr)	Stern, Michael
King, Rt Hon Tom	Stewart, Allan
Knapman, Roger	Sweeney, Walter
Knight, Mrs Angela (Erewash)	Sykes, John
Knight, Greg (Derby N)	Taylor, Ian (Esher)
Knight, Dame Jill (Bir'm E'st'n)	Taylor, Rt Hon John D. (Strgfd)
Knox, Sir David	Taylor, John M. (Solihull)
Kynoch, George (Kincardine)	Taylor, Sir Teddy (Southend, E)
Lait, Mrs Jacqui	Temple-Morris, Peter
Lamont, Rt Hon Norman	Thomason, Roy
Lawrence, Sir Ivan	Thompson, Sir Donald (C'er V)
Legg, Barry	Thompson, Patrick (Norwich N)
Leigh, Edward	Thornton, Sir Malcolm
Lennox-Boyd, Mark	Thurnham, Peter
Lester, Jim (Broxtowe)	Townend, John (Bridlington)
Lidington, David	Townsend, Cyril D. (Bexl'yh'th)
Lightbown, David	Tracey, Richard
Lilley, Rt Hon Peter	Tredinnick, David
Lloyd, Rt Hon Peter (Fareham)	Trend, Michael
Lord, Michael	Tyler, Paul
Lynne, Ms Liz	Vaughan, Sir Gerard
MacGregor, Rt Hon John	Viggers, Peter
MacKay, Andrew	Walden, George
Maclean, David	Walker, A. Cecil (Belfast N)
McLoughlin, Patrick	Walker, Bill (N Tayside)
Maddock, Mrs Diana	Wallace, James
Maginnis, Ken	Ward, John
Maitland, Lady Olga	Wardle, Charles (Bexhill)
Malone, Gerald	Waterson, Nigel
Mans, Keith	Watts, John
Marland, Paul	Wells, Bowen
Mawhinney, Rt Hon Dr Brian	Wheeler, Rt Hon Sir John
Merchant, Piers	Whitney, Ray
Michie, Mrs Ray (Argyll Bute)	Whittingdale, John
Mills, Iain	Widdecombe, Ann
Mitchell, Andrew (Gedling)	Willetts, David
Mitchell, Sir David (Hants NW)	Wood, Timothy
Montgomery, Sir Fergus	Yeo, Tim
Nelson, Anthony	Young, Rt Hon Sir George
Neubert, Sir Michael
Newton, Rt Hon Tony	Tellers for the Ayes:
Nicholls, Patrick	Mr. Timothy Kirkhope and Mr. Michael Brown.
Nicholson, Emma (Devon West)
Oppenheim, Phillip

NOES
Ainsworth, Robert (Cov'try NE)	Lewis, Terry
Barnes, Harry	McAvoy, Thomas
Bayley, Hugh	Macdonald, Calum
Benn, Rt Hon Tony	McMaster, Gordon
Callaghan, Jim	McWilliam, John
Campbell, Ronnie (Blyth V)	Mahon, Alice
Campbell-Savours, D. N.	Marek, Dr John
Canavan, Dennis	Marshall, Jim (Leicester, S)
Chisholm, Malcolm	Martin, Michael J. (Springburn)
Clarke, Eric (Midlothian)	Meale, Alan
Connarty, Michael	Michie, Bill (Sheffield Heeley)
Corbyn, Jeremy	O'Hara, Edward
Cox, Tom	Olner, William
Cunningham, Jim (Covy SE)	Parry, Robert
Dixon, Don	Patchett, Terry
Dowd, Jim	Pike, Peter L.
Etherington, Bill	Powell, Ray (Ogmore)
Flynn, Paul	Prentice, Ms Bridget (Lew'm E)
Galbraith, Sam	Skinner, Dennis
George, Bruce	Spellar, John
Godman, Dr Norman A.	Wise, Audrey
Gunnell, John
Home Robertson, John	Tellers for the Noes:
Hood, Jimmy	Mr. Bob Cryer and Mr. George Mudie.
Illsley, Eric

Question accordingly agreed to.

Motion made, and Question put,

That the draft statutory sick Pay (Rate of Payment) Order 1994 which was laid before this House on 10th February, be approved.—[Mr. Andrew Mitchell.]

The House divided: Ayes 233, Noes 44.

Division No. 133]	[9.48 pm
AYES
Ainsworth, Peter (East Surrey)	Coe, Sebastian
Alison, Rt Hon Michael (Selby)	Colvin, Michael
Allason, Rupert (Torbay)	Congdon, David
Alton, David	Conway, Derek
Arbuthnot, James	Coombs, Simon (Swindon)
Arnold, Jacques (Gravesham)	Cope, Rt Hon Sir John
Arnold, Sir Thomas (Hazel Grv)	Cran, James
Ashby, David	Currie, Mrs Edwina (S D'by'ire)
Atkins, Robert	Davies, Quentin (Stamford)
Atkinson, David (Bour'mouth E)	Day, Stephen
Atkinson, Peter (Hexham)	Deva, Nirj Joseph
Baker, Nicholas (Dorset North)	Devlin, Tim
Baldry, Tony	Douglas-Hamilton, Lord James
Banks, Matthew (Southport)	Dover, Den
Beggs, Roy	Duncan, Alan
Bellingham, Henry	Duncan-Smith, Iain
Bendall, Vivian	Dunn, Bob
Beresford, Sir Paul	Durant, Sir Anthony
Blackburn, Dr John G.	Elletson, Harold
Bonsor, Sir Nicholas	Evans, Jonathan (Brecon)
Boswell, Tim	Evans, Nigel (Ribble Valley)
Bottomley, Peter (Eltham)	Evans, Roger (Monmouth)
Bowden, Andrew	Faber, David
Bowis, John	Fabricant, Michael
Boyson, Rt Hon Sir Rhodes	Fenner, Dame Peggy
Brandreth, Gyles	Fishburn, Dudley
Brazier, Julian	Forman, Nigel
Browning, Mrs. Angela	Forsyth, Michael (Stirling)
Bruce, Ian (S Dorset)	Forsythe, Clifford (Antrim S)
Burns, Simon	Forth, Eric
Burt, Alistair	Fox, Dr Liam (Woodspring)
Butler, Peter	Freeman, Rt Hon Roger
Butterfill, John	French, Douglas
Campbell, Menzies (Fife NE)	Fry, Sir Peter
Carlile, Alexander (Montgomry)	Gale, Roger
Carlisle, John (Luton North)	Gallie, Phil
Carrington, Matthew	Gardiner, Sir George
Carttiss, Michael	Garel-Jones, Rt Hon Tristan
Cash, William	Gill, Christopher
Channon, Rt Hon Paul	Gillan, Cheryl
Chapman, Sydney	Gorman, Mrs Teresa
Clappison, James	Greenway, Harry (Ealing N)
Clifton-Brown, Geoffrey	Greenway, John (Ryedale)

Griffiths, Peter (Portsmouth, N)	Peacock, Mrs Elizabeth
Grylls, Sir Michael	Pickles, Eric
Hague, William	Porter, David (Waveney)
Hamilton, Rt Hon Sir Archie	Rendel, David
Hamilton, Neil (Tatton)	Renton, Rt Hon Tim
Hampson, Dr Keith	Richards, Rod
Hannam, Sir John	Riddick, Graham
Hargreaves, Andrew	Robathan, Andrew
Harris, David	Roberts, Rt Hon Sir Wyn
Hawkins, Nick	Robertson, Raymond (Ab'd'n S)
Hawksley, Warren	Robinson, Mark (Somerton)
Hayes, Jerry	Roe, Mrs Marion (Broxbourne)
Hendry, Charles	Rumbold, Rt Hon Dame Angela
Horam, John	Scott, Rt Hon Nicholas
Howarth, Alan (Strat'rd-on-A)	Shaw, David (Dover)
Howell, Rt Hon David (G'dford)	Shaw, Sir Giles (Pudsey)
Howell, Sir Ralph (N Norfolk)	Shepherd, Colin (Hereford)
Hughes Robert G. (Harrow W)	Shersby, Michael
Hughes, Simon (Southwark)	Sims, Roger
Hunt, Sir John (Ravensbourne)	Skeet, Sir Trevor
Hunter, Andrew	Smith, Sir Dudley (Warwick)
Jack, Michael	Smith, Tim (Beaconsfield)
Jackson, Robert (Wantage)	Soames, Nicholas
Jenkin, Bernard	Speed, Sir Keith
Jones, Nigel (Cheltenham)	Spicer, Sir James (W Dorset)
Jones, Robert B. (W Hertfdshr)	Spink, Dr Robert
King, Rt Hon Tom	Spring, Richard
Kirkwood, Archy	Squire, Robin (Hornchurch)
Knapman, Roger	Stanley, Rt Hon Sir John
Knight, Mrs Angela (Erewash)	Steen, Anthony
Knight, Greg (Derby N)	Stephen, Michael
Knight, Dame Jill (Bir'm E'st'n)	Stern, Michael
Knox, Sir David	Stewart, Allan
Kynoch, George (Kincardine)	Sweeney, Walter
Lait, Mrs Jacqui	Sykes, John
Lamont, Rt Hon Norman	Taylor, Ian (Esher)
Lawrence, Sir Ivan	Taylor, Rt Hon John D. (Strgfd)
Legg, Barry	Taylor, John M. (Solihull)
Leigh, Edward	Taylor, Sir Teddy (Southend, E)
Lennox-Boyd, Mark	Temple-Morris, Peter
Lester, Jim (Broxtowe)	Thomason, Roy
Lidington, David	Thompson, Sir Donald (C'er V)
Lightbown, David	Thompson, Patrick (Norwich N)
Lilley, Rt Hon Peter	Thornton, Sir Malcolm
Lloyd, Rt Hon Peter (Fareham)	Thurnham, Peter
Lord, Michael	Townend, John (Bridlington)
Lynne, Ms Liz	Townsend, Cyril D. (Bexl'yh'th)
MacGregor, Rt Hon John	Tracey, Richard
MacKay, Andrew	Tredinnick, David
Maclean, David	Trend, Michael
McLoughlin, Patrick	Tyler, Paul
Maddock, Mrs Diana	Vaughan, Sir Gerard
Maginnis, Ken	Viggers, Peter
Maitland, Lady Olga	Walden, George
Malone, Gerald	Walker, A. Cecil (Belfast N)
Mans, Keith	Walker, Bill (N Tayside)
Marland, Paul	Wallace, James
Marshall, John (Hendon S)	Ward, John
Mates, Michael	Wardle, Charles (Bexhill)
Mawhinney, Rt Hon Dr Brian	Waterson, Nigel
Merchant, Piers	Watts, John
Michie, Mrs Ray (Argyll Bute)	Wells, Bowen
Mills, Iain	Wheeler, Rt Hon Sir John
Mitchell, Andrew (Gedling)	Whitney, Ray
Mitchell, Sir David (Hants NW)	Whittingdale, John
Montgomery, Sir Fergus	Widdecombe, Ann
Nelson, Anthony	Willetts, David
Neubert, Sir Michael	Wilshire, David
Newton, Rt Hon Tony	Wood, Timothy
Nicholls, Patrick	Yeo, Tim
Nicholson, Emma (Devon West)	Young, Rt Hon Sir George
Oppenheim, Phillip
Page, Richard	Tellers for the Ayes:
Paice, James	Mr. Timothy Kirkhope and Mr. Michael Brown.
Patnick, Irvine
Pawsey, James

NOES
Ainsworth, Robert (Cov'try NE)	Bayley, Hugh
Barnes, Harry	Callaghan, Jim

Campbell, Ronnie (Blyth V)	McMaster, Gordon
Campbell-Savours, D. N.	McWilliam, John
Chisholm, Malcolm	Mahon, Alice
Clarke, Eric (Midlothian)	Marek, Dr John
Connarty, Michael	Marshall, Jim (Leicester, S)
Corbyn, Jeremy	Martin, Michael J. (Springburn)
Cox, Tom	Meale, Alan
Cunningham, Jim (Covy SE)	Michie, Bill (Sheffield Heeley)
Dixon, Don	Mudie, George
Dowd, Jim	O'Hara, Edward
Etherington, Bill	Olner, William
Flynn, Paul	Parry, Robert
George, Bruce	Patchett, Terry
Godman, Dr Norman A.	Pike, Peter L.
Gunnell, John	Powell, Ray (Ogmore)
Home Robertson, John	Prentice, Ms Bridget (Lew'm E)
Hood, Jimmy	Spellar, John
Illsley, Eric	Wise, Audrey
Lewis, Terry
Loyden, Eddie	Tellers for the Noes:
McAvoy, Thomas	Mr. Bob Cryer and Mr. Dennis Skinner.
Macdonald, Calum

Question accordingly agreed to.