HC Deb 28 February 1994 vol 238 cc643-4
15. Mr. Alan W. Williams

To ask the Secretary of State for Social Security what has been the percentage change in real terms since 1979 in (a) average earnings, (b) the basic pension for a single person and (c) the level of income support for a single parent with two children.

Mr. Hague

Since 1979, average earnings have increased by 35 per cent. in real terms. In the same period, the basic state retirement pension has risen by 3.2 per cent. in real terms, although the total average income of single pensioners has risen by 39 per cent. in real terms since 1979.

It has been estimated that the level of supplementary benefit or income support for a typical lone parent with two children under five has risen by about 16 per cent. in real terms since 1979. However, direct comparisons between income support and supplementary benefit are difficult to make because the two schemes are very different.

Mr. Williams

Will the Minister comment on the "Social trends" survey figures published last month, which showed that since 1979 the share of national income of the richest fifth of our population has increased from 35 to 43 per cent. but the share of the poorest fifth has dropped from 10 to 6 per cent? Does he agree that the rich get richer and the poor get poorer? We are "back to basics" Tory style.

Mr. Hague

What is important is that since 1979 there has been an increase in income for all groups in society. That is what really matters. For example, the proportion of pensioners in the bottom decile of the income distribution, which was 31 per cent. in 1979, fell to 11 per cent. in 1990. That is a dramatic improvement in pensioners' living standards.

Mr. Jonathan Evans

Has my hon. Friend had time to assess what would have been the effect of success by the 53 Opposition Members who attempted to stop the recent pensions increase?

Mr. Hague

If that vote had been successful, it would have deprived pensioners of several hundreds of millions of pounds of income.

Mr. Rooney

Does the Minister recognise in his manipulation of statistics that 8.25 million people are dependent on income support whereas 3 million were in 1979?

Mr. Hague

Income support did not exist in 1979; there was supplementary benefit. I have compared the level of supplementary benefit as closely as possible to income support now. Income support now is approximately 16 per cent. higher than in 1979. That reflects the commitment of the Government to help people in a difficult position.

Mr. Duncan

Does my hon. Friend accept that it is sensible to increase benefits in line with inflation and not in line with earnings? Has he seen a report that suggests that if we increased benefits with earnings, in the next century we would have to add 17p to the basic rate of income tax to pay for it?

Mr. Hague

My hon. Friend is right to draw attention to the fact that increasing benefits in line with earnings would clearly add many billions to expenditure in future years.