HC Deb 16 May 1994 vol 243 cc545-6
10. Mr. Clifton-Brown

To ask the Secretary of State for Social Security what effect the change in the level of unemployment since November 1993 has had on his Department's estimate of the cost of income support provision for this financial year.

Mr. Lilley

The number of unemployed claimants has dropped by more than 90,000 since November 1993, and we estimate that that has reduced expenditure on income support by £176 million and on unemployment benefit by £90 million.

Mr. Clifton-Brown

Does my right hon. Friend agree that the very welcome news of a year-on-year reduction of nearly 250,000 in unemploymennt has had an extremely beneficial effect on the cost of unemployment-related benefits? Does he also agree that policies that would introduce a statutory minimum wage and a maximum working week would be liable to increase unemployment, with a consequent increase in the cost of benefits and the likelihood of tax increases to pay for them?

Mr. Lilley

My hon. Friend makes a strong point. The fall in unemployment does not just reduce my budget; it is a great boon and benefit to those 250,000 households whose members are now back at work instead of being unemployed. We are doing all that we can to encourage people back into work, not least through benefits such as family credit, which now enables 500,000 people to work who previously might have been tempted to remain unemployed.

Mr. Madden

Does the Secretary of State recall making a remarkably unpleasant speech at last year's Conservative party conference, and subsequently suggesting the introduction of a so-called habitual residency test? Have the social security commissioners given any recommendation on that ill-advised proposal? If the right hon. Gentleman introduces such a test, will he provide an exemption for citizens of the Irish Republic? Will he be sensible and allow that barmy idea to die a natural death?

Mr. Lilley

My recollection is of warm support, both then and subsequently, not least for the proposal that we in this country should introduce something that already exists in most continental countries. It would not be possible for someone from this country to go to most continental countries and pick up the equivalent of income support and housing benefit. Why should people from the continent who are here to learn English be entitled to do that? We are being thoroughly communautaire in adopting similar procedures over here, but we have not yet heard the full results of the consideration being given to the matter by the Social Security Advisory Committee.