§ Madam Speaker
I have selected the amendment in the name of the Prime Minister. I must also advise hon. Members that, between the hours of 7 and 9 pm this evening, speeches must be limited to 10 minutes.
§ Mr. Donald Dewar (Glasgow, Garscadden)
I beg to move,That this House condemns the damage done to the country's social fabric and economy by the rapid growth of poverty in United Kingdom society; deplores Government policies which have failed the long-term unemployed, seen the number of families living on less than half national average income treble and deprived many of an opportunity to contribute to and share in national prosperity; and calls for immediate concerted action to tackle the causes of poverty and unemployment including a major welfare-to-work programme, a national childcare strategy and action to improve education and skills.Last Thursday, as many hon. Members will remember, my right hon. Friend the Leader of the Opposition asked the Prime Minister whether it was the aim of the Government to redress inequality. The answer was a simple and unadorned yes. That agreement, that common ground should be our starting point this afternoon.
The Prime Minister went on, rather more controversially, to say that, in his view, the right way to combat poverty wasby ensuring that chances and opportunities are greater so inequality falls; that is the right way and that is what the Government are doing."—[Official Report, 9 February 1995; Vol. 254, c. 453.]The House will not be surprised to hear that I quarrel with that judgment. Put plainly, I do not believe that there is evidence, and certainly no convincing argument, that present policies are controlling or even limiting the growth of inequality. More seriously, and more disappointingly, there is little or no evidence that the Government are trying to do so.
There will be much talk during the debate—and rightly so—about the Rowntree report that was produced last week. Indeed, that was the cause and the basis of the exchange between the Prime Minister and the Leader of the Opposition. It is right that a good deal of attention should be paid to the report because its publication is a public service. It puts the harsh profile of growing problems of poverty in sharp relief.
§ Mrs. Cheryl Gillan (Chesham and Amersham)
Could the hon. Gentleman confirm that the Rowntree foundation report was drafted by John Hills, a Labour activist who worked on the Fabian Society tax review before the last election?
§ Mr. Dewar
The hon. Lady should remember that, whoever wrote the draft, the report was unanimously approved by, for example, Mr. Howard Davies of the CBI, by a very prominent Conservative who is a member of the Baring banking family, and by the deputy chairman of British Telecom. To suggest that it is a put-up job or a Labour conspiracy reflects no credit on the hon. Lady's 803 intelligence, and I suspect that it reflects even less credit on the central office briefing that she was probably clutching.
§ Mr. Dewar
No. Let me make it clear that I shall take some points of information as the debate proceeds, but that I am anxious to make progress and to establish my first point. The report gives perspective and clarity, and the picture that emerges from its findings is of a disunited kingdom. Every right hon. and hon. Member should take that seriously.
I understand that, in the past few minutes, the Prime Minister has been dealing with these problems with the attitude of a latter-day Pangloss. Of course he is right that there are families and pensioners who are doing well. That is almost by definition a picture of the divided community. There are people on the right side of the divide in the arithmetic who are flourishing, and nobody complains about that.
The trouble is that, while pensioner incomes on average are rising, 1.6 million are existing on income support. While many families are comfortably off, others—one of the most vulnerable groups in society: perhaps with several children and a low wage—are living just above the income support level and in real difficulty.
What clearly emerges from the report is that income inequality is greater now than at any time since the second world war, and that, since the Government came to power, the lowest income groups—perhaps as many as 15 million people—have been deprived of any share in increasing national wealth. Rowntree found that, even after excluding the self-employed—and that is of some significance—incomes of the bottom 10 per cent. of the population, after housing costs, were 9 per cent. lower than they were in 1979. Since 1977, the proportion of the population living on less than half the national average income has trebled.
§ Mr. Dewar
I will come to that point. I can always rely on the hon. Member for Rutland and Melton (Mr. Duncan) to feed me a line; he is one of the best stooges in the House from the Labour party's point of view. I think that he can comprehend the fact that in Tory Britain more than 10 million people are now dependant upon income support, which is more than double the number when the hon. Gentleman's friends came to power.
A family on income support comprising a husband, a wife and two children is living on about one third of the national average wage. That leaves very little room for comfort. I do not argue that the meek should inherit the earth, but I do not believe that they should be cut off without a penny.
§ Mr. Dewar
That is not what we propose—nor, to be fair, is it a proper representation of the points in the Rowntree report. I will turn to solutions later in my remarks.
The hon. Member for Hertfordshire, North (Mr. Heald) obviously dislikes the Rowntree report. I can understand that; it is inconvenient and no doubt embarrassing. However, the charges in the report are wholly corroborated by other evidence. As the hon. Gentleman takes these matters seriously, I know that he will recall the report of the Institute for Fiscal Studies entitled "For Richer and For Poorer", which deals with income distribution between 1961 and 1991. It hammers the same case, and it comes to the same conclusions.
For a local case study with which the hon. Member is probably not familiar, he should go to Her Majesty's Stationery Office and ask for a copy of "Poor and Paying for it: the price of living on a low income", which is an exhaustive examination of the privileges—or really the penalties—of living in poverty in Scotland. It was produced by the Scottish Consumer Council, all of whose members I think have been appointed by the Secretary of State for Scotland and are therefore not likely to be interested in deliberately doing him in for political reasons. I think that the case is almost overwhelming.
§ Mr. Peter Ainsworth (Surrey, East)
I fear that the hon. Gentleman is putting forward a bogus argument based on a report which is substantially founded on dubious facts. Does he accept that the Social Services Select Committee has reported that those on income support are 15 per cent. better off now than they were in 1979? Does he further accept that all social services payments and payments for health, education and other public spending originate from enterprise and initiative, and that his party's policies will spoil our country's ability to meet the payments that our people want and need?
§ Mr. Dewar
The hon. Gentleman has taken his time to make a rather familiar point. I am anxious to help him. I recognise that he believes that the Rowntree report is prejudiced and fraudulent—he has said that in pretty clear terms. I will be interested to hear whether the Secretary of State for Social Security accepts that the basis of that body's work is flawed in that way.
I invite the hon. Gentleman to consult another authority. If he looks in Hansard of 2 February 1995, he will see a written answer to a question from my hon. Friend the Member for Sunderland, South (Mr. Mullin). He asks for the percentage change in real incomes of the top 20 per cent. of families with children and the bottom 20 per cent. between 1979 and 1991–92, the latest date for which figures are available.
After housing costs, according to the Department of Social Security and the Minister who speaks for it, the bottom 20 per cent. have seen their incomes fall by 12 per cent. in real terms; while the incomes of the top 20 per cent. have increased by 49 per cent. A division is clearly opening up, as those two groups were already advantaged on the one hand and disadvantaged on the other.
805 It may be interesting to argue what we should do about that, or even to what extent Government can control those matters, but to say that it is not happening is to fly in the face of common sense and evidence, at every level and from every source. It makes the hon. Member for Surrey, East (Mr. Ainsworth) look a little silly.
A defence has been mounted, and I will turn to that point.
The Prime Minister, for example—after all, he is only echoing the views of the hon. Member for Rutland and Melton, and could he do better—said that the Government are a victim of their own generosity. Because they raise benefits, they create poverty and move the poverty line. But, unfortunately, if one looks at what happened—because in recent years the Government have tied the level of benefits to the retail prices index—one will see that a gap has opened up between them and earnings, which have tended to increase more quickly, and that is one of the reasons for that phenomenon.
§ Mr. Dewar
No, I am sorry, but I must go on.
It has been urged on other occasions that we should not take into account the figures for the bottom 10 per cent., because they are inaccurate. I remember an interesting debate sponsored by my hon. Friend the Member for Gateshead, East (Ms Quin) in which the hon. Member for Bury, North (Mr. Burt), an Under-Secretary of State for Social Security, presented with the irrefutable evidence about the deterioration in the prospects of the bottom 10 per cent., said, "Well, you can't really believe these figures, because they are full of the self-employed–100,000 farmers, 40,000 taxi drivers, 12,500 qualified accountants, who are returning nil or negative incomes as a clever piece of tax management." If that is happening, it is a very eloquent comment on our tax system.
In any event, the Rowntree figures, and the Government's figures in the parliamentary answer, do not talk about the very bottom 10 per cent., but about 20 per cent. at the bottom and 20 per cent. at the top–40 per cent. of the population. I submit—I do not think that any statistician would argue with me—that they give a fair account of what is happening in Britain today.
I remind the House of the figures I gave a moment ago from the Rowntree report. It excluded the self-employed—that doubtful category that might give rise to misunderstanding—and still found that the bottom 10 per cent. is down 9 per cent. after housing costs since 1979.
§ Mr. Dewar
No, I am sorry. I am going to hurry on. I recognise that there are limitations on the time that I can take.
I believe that it is beyond argument that the gap is widening. The Government, of course, say that they are still trying to do something about it. After all, they have a proven track record of failure in many fields, and they may indeed be doing their best. One of the most damaging aspects is the impact of Government policy itself. To quote the Rowntree report:Discretionary tax changes shifted the burden of taxation from higher to lower and middle income groups.806 That can be illustrated in a welter of facts and figures with which many hon. Members are familiar.
Too many people in the Cabinet, perhaps even the Secretary of State for Social Security, are still thirled to the Thatcher legacy, and still believe in the trickle-down theory: help the poor by making the rich richer. I have heard that, and no doubt will hear it again in the course of the debate.
I do not believe that that is any longer an area of legitimate dispute. It has been destroyed by the experience of the past 15 years, by observable fact, by the situation that we see around us in our constituencies. The bottom is getting detached. We now see cynicism and alienation to a dangerous extent in our communities.
§ Mr. Clappison
I am grateful to the hon. Gentleman for giving way.
The hon. Gentleman criticised the Government a moment ago for not linking benefits to earnings rather than prices; he then passed on very quickly. Will he give a commitment that the Labour party would link benefits to earnings rather than prices—yes or no?
§ Mr. Dewar
I have explained our position—[Interruption.] I am sorry that the hon. Gentleman does not listen to me. I shall say it again for his benefit: we have always protested against the unbreakable glass ceiling that has been imposed by the Government. We have also made it clear that we do not think that it is right that, over a lengthy period, those on benefits should be excluded from rising national wealth. As a prudent Opposition, who make promises only when we know that we can deliver, we have made it absolutely clear that we will halt that decline and try to reverse it when circumstances allow. [Interruption.] As I am always urged to be responsible and prudent, I find the kind of jackass noises coming from Conservative Members brave but ill advised.
Let me make it clear to the House. The concern that I have expressed is widely shared. I am sure that hon. Members—I suspect that they have read The Sunday Telegraph—will have seen the report this weekend, which, if correct, suggests that the senior civil service shares our concern about the growth in poverty and division in our communities. It is reported that Sir Robin Butler brought together permanent secretaries from eight departments to discuss the problems that arise when policies designed to increase choice destroy it for those who are already disadvantaged. They cited bus deregulation, the mobility problems when services are run down in peripheral schemes and a housing policy that forces people into benefit dependency; they also considered the problems of single parents. In those instances, they felt that what the Government were doing was incompatible with the interests of the poorer sections of the community.
I have not seen the document, but it appears at least to constitute a direct challenge to the Prime Minister's claim that opportunity is opening up for those who are currently in travail. If it does not constitute such a challenge, I suggest to the Secretary of State that the best way in 807 which to remove that presumption is to publish the note that we are told is circulating in Whitehall, so that we can all judge.
The Butler discussions, as reported, point to another key fact that we must keep in mind. This is not simply an argument about cash; deprivation has a much wider remit than that. It affects education: the ambitions of many children with real ability are being stifled and ended. It affects employment, and the prospects of low-paid people to whom choice is not open.
§ Mr. Dewar
Unemployed people are subject to the deadening round of benefit dependency, relieved only by problems related to the "actively seeking work" test.
If hon. Members examine any one of those areas of social policy, they will realise that the chances in life of many people—probably many people in Conservative constituencies, but certainly many in my constituency—are being destroyed. For many—some may think this a rather over-dramatic statement, but I consider it entirely justified—life itself is literally being cut short.
I do not know how many hon. Members watched last night's BBC "Panorama" programme. It concentrated on a peripheral housing scheme in west Glasgow—the Drumchapel scheme. I happen to know that area very well, because I represent it; so I watched the programme with considerable interest and concern. I accept that concentration on a single aspect of an area does not always give a complete picture. Drumchapel is a community with problems, but it has strengths as well: its strengths lie in its people—people who too often, and in so many ways, are obstructed rather than assisted by the system.
The facts are familiar. Most Members of Parliament recognise the link between deprivation and health. Perhaps those facts have become too familiar, and have lost the ability to shock; it should not be so.
As I have said, the television programme dealt with a housing scheme in a deprived area of my constituency. Literally a hundred yards away is Bearsden, a leafy suburb whose economic circumstances are very different. Between 1981 and 1991, male mortality between the ages of 15 and 46 rose by 9 per cent. in Drumchapel; in Bearsden, it fell by 14 per cent. It was a case not of both rates improving, or of one improving faster than the other: the mortality rate in Bearsden improved, while it deteriorated in Drumchapel.
Young men in Drumchapel are twice as likely to (lie as those living in an affluent and leafy suburb. They are 75 per cent. more at risk during major surgery. This may not be a pleasant subject, but it is a fact that, for a person living in a poor area such as Drumchapel who requires a bowel operation, the chances of developing complications and dying are 50 per cent. higher than those of a person living in the neighbouring affluent area.
The position is not academic. In an area such as Drumchapel, a man's life expectancy can be as much as 10 years shorter than in the neighbouring area, while a woman's can be seven years shorter. I make no apology for saying that these are people whom I know and with 808 whom I deal; constituents of yours, whom you too will know, Madam Speaker; and people with whom many of my hon. Friends work.
§ Mr. Brandreth
The hon. Gentleman has spent 22 minutes telling us that he deplores poverty. I deplore it, too: I think that we agree on that. We also agree, I hope, that we want increased growth and a better standard of living for all our citizens. The motion speaks of a "programme", a "childcare strategy" andaction to improve education and skills".Can the hon. Gentleman flesh that out? Can he tell us when he will introduce the programme, what it would cost and how he believes that it will improve the state that he currently deplores?
§ Mr. Dewar
I am genuinely glad that the hon. Gentleman rose, because the fact that he accepts the tenor and accuracy of my remarks—"We all agree," he said—: is a refreshing contrast to almost every point of information that has been made in the debate. On occasions, he must feel a rather lonely man on the Conservative Benches. I will come to his question in a minute. I can answer the first part very simply. We will do it when we are in government, which probably is not going to be so very far away.
§ Mr. Dewar
Let me just complete my medical point. It will be quite short, and it involves issues in which I feel very involved. I have talked to many of the people involved, and medical opinion is united on the link with deprivation. It was first established by the Black report, and since then it has been established many times by research in many parts of the country.
I am talking not just about Drumchapel. In Glasgow, I find it deeply depressing that successive holders of the senior post in public health believe not only that a direct link exists between deprivation and poverty, but that that gap will continue to widen if present trends continue. That is not something that any hon. Member can be satisfied about.
The Minister for Health was no doubt doing his best on television last night. I make no criticism of him personally; I know that he is closely connected with the city of Glasgow, and that he knows a great deal about medicine in Glasgow. I may, of course, misquote him in detail, but I think that I have caught the spirit of his comments.
The Minister was asked whether deprivation was a major part of the health problem that was being recorded. He answered that it was a matter of subjective judgment, but a diversion from the real debate about specific health problems and about how to treat them. I shall not overdo this, but, in my considered opinion, that does not show the necessary sense of urgency, or the overall view that gives hope that this distressing problem will he properly tackled.
809 In considering high cancer rates in areas of depression, the Minister for Health said, again revealingly, that anyone can give up smoking. In Drumchapel, one is three times more likely to die of lung cancer than someone who lives in Bearsden. I went to university because of opportunity, expectation and family and peer group support. Would I have made it if I had had to struggle in the sort of circumstances in which we let many of my constituents live?
As I sit in my surgery, I often feel that I have never been in the position where a small unexpected bill amounts to a financial crisis for my constituents because they have no edge or margin in which to live and to work. I would not be happy defending the record of recent years, or a system that is built on the basis that the outstandingly able will be able to beat that system, but that many others will inevitably and unfairly be left as casualties.
Let me now come to the question raised by the hon. Member for City of Chester (Mr. Brandreth) about what is to be done. I want to make it clear that I recognise that it would be dishonest and counter-productive to promise an instant transformation under any Government. Obviously, the situation has been running unchecked for some considerable time, but it must now be met with commitment and determination over a period to redress the balance.
§ Mr. Streeter
If the hon. Gentleman is genuine in his concern for the people whom he describes, and I accept that he is, why will he not commit a future Labour Government to spend more money on such people?
§ Mr. Dewar
I shall come to our programme in a moment. Of course, as I made clear, I want to redress the balance, but—as I am sure the hon. Gentleman would be the first to agree—we must get the system and the priorities right. It is not simply a matter of taking a system that is operating inefficiently and badly, and pouring more money into it.
If that were true, the Secretary of State for Social Security would have presided over one of the most effective attacks on inequality and poverty, as his budget has spiralled to £90 billion. Sadly, the money has been wasted, putting the taxpayer in the firing line, because recession and poverty must be funded by the taxpayer. It is working, tax-paying middle Britain that has been put into the firing line by these mistaken policies. One of the first things we must do is ensure that the money is used effectively, and that our priorities are right.
§ Mr. Alan Howarth (Stratford-on-Avon)
I quite understand why the hon. Gentleman would do anything rather than put numbers on his policies and make specific spending commitments. He said that it was important to get the system and the priorities right, but will he tell us what principles will animate new Labour in its policy making?
We are given to understand that, in the new dawn, we shall not have our lives run for us by Fabian managerialists, or ruled by big corporate interests. Instead, under new Labour, the people will have choice and Labour will embrace markets. However, as the hon. Gentleman has, I think, been saying, markets do not necessarily induce fairness, so what principles will Labour apply to regulate and civilise the markets? [HON.
810 MEMBERS: "Come on.''] What principles will it operate to determine the degree of regulation, planning, investment, intervention and redistributive taxation in order to achieve the greater fairness and equality that the hon. Gentleman seeks?
§ Mr. Dewar
I think that the merriment that greeted the hon. Gentleman's interjection—which was, as ever, well reasoned—tells its own tale.
Of course, we have to inject fairness into the tax system. [HON. MEMBERS: "How?"] I did not want to go into that, because it is a narrow battle, but are Conservatives proud of the fact that, this afternoon, Sir Desmond Pitcher of North West Water is defending the share options and salary increases of the privatised utilities? Is that the symbol of Conservative Britain? As I understand it, share options in the pipeline at North West Water, which are worth very nearly £5 million, are to be shared among six board directors. [Interruption.]
§ Madam Speaker
Order. I have heard enough barracking from sedentary positions. We should be able to hear the debate.
§ Dr. Norman A. Godman (Greenock and Port Glasgow)
It is the hon. Member for South Dorset, (Mr. Bruce).
§ Mr. Dewar
Perhaps we should take that as a symbol of the priorities. Of course there has to be a fair tax system. We have to get away from a situation in which people can make offensively large sums of money and capital gains, not by virtue of being themselves but simply because a situation has been created by the Government which looks unpleasantly like a private monopoly. What is happening upstairs is perhaps a symbol of that.
Of course, the best way to help people is to get them back to work if we can, and I want to say a word or two about that. I have made it clear that I am not asking for massive new spending commitments at this stage. I want to do what Sir Robin Butler attempted to do, as we understand it, with his working party, which was to ensure that Government policies are examined, no doubt from many points of view. However, one point of view that should be given particular priority is the impact of those policies on the life chances and position in society of the disadvantaged and underprivileged. The working party highlighted many examples where that has not happened.
We need an effective policy to take people off welfare and into work. Of course, there was some gesture politics, especially during the Budget. For example, insurance holidays were announced for employers who took people off the long-term unemployment register. We calculated that it was worth £6 a week, and I take no particular pleasure in predicting that it will have no impact whatsoever. In addition, there is the back-to-work bonus, which means no help now, jam tomorrow or perhaps jam never. If one is lucky and advantaged enough to find a job, one gets a divvy on top. That is not the answer to the problem.
I understand that, today, in the Committee debating the Jobseekers Bill, an announcement is being made on the 21-hour rule. I believe that the 21-hour rule should be re-examined. There is a case for a more flexible approach, because it is a pretty mad world in which someone who wants to enhance his skills by following a course of more
811 than 21 hours a week is not entitled to any support in the form of benefits and therefore cannot do the course. He ends up drawing the benefit anyway, but does without the skill enhancement.
Perhaps the Secretary of State can tell me whether, as I understand, the 21-hour rule is to be cut to 16 hours, which makes the whole system even more inflexible and makes it harder for people to move into education or skill training while retaining at least a marginal life support within the benefit system. I want to see—
§ Mr. Dewar
I am trying to answer some of the questions that have been asked. If the hon. Gentleman contains himself, I would like to draw to a conclusion quite soon, because I am conscious of the new rulings.
Obviously, we ought to be looking at child care. We ought to be putting the emphasis on training, not cutting the budget. We ought, obviously, to be considering not the kind of national insurance holiday that the Chancellor proposed, but a tax concession or allowance for employers who take people off the register of those unemployed for two years, which would give real impetus to getting people back to work.
Those are important factors, which would, over a period, begin to make a difference and begin to work. We need, as I say, to make better use of the resources that have been allocated. We must recognise that deprivation, as I tried to say during earlier exchanges, is expensive for us all. Inequality unchecked puts stability and social cohesion at risk, at hazard.
The Government are confused and divided on such matters. Evidence of that can be heard in the various conflicting briefings which no doubt lie at the root of the points of information that have been made during my speech. The Conservatives have a divided party and a divided Cabinet, presiding over a divided country.
On the other side of the argument, some, as we have heard, simply deny the facts about events happening around us. Some argue that the market should have its head, that Adam Smith's invisible hand still rules, and that inequality is built into a system that rewards initiative and ability. Predictably, the hon. Member for Surrey, East, who made that point, has gone. No doubt he did not want to stay for any sustained argument.
Such people argue that inequality is built into a system that rewards initiative and ability, and that it is a price worth paying. I do not think that it is a price worth paying. It is especially morally offensive to ask other people to pay that price when we are not prepared to pay anything ourselves.
The Prime Minister was right last Thursday when he said that it was the duty of Government to try to reduce inequality. He is disastrously wrong when he argues that his Government have got it right and that they are creating opportunity and hope in the areas which are hard hit.
I have a long memory. I remember that on 23 November 1990, the Prime Minister proclaimed his belief thatin the next 10 years we will have to make changes that will genuinely produce across the whole country a genuinely classless society in which people can rise to whatever level that their own abilities and their own good fortune may take them, from wherever they started.812 If we look at the statistics, at the picture that emerges, at the individual experience of Members of Parliament who worry and cope as best they can with the damage on the ground, and at the shape of Britain of the future if those trends run unchecked, we see what a failure that aspiration has been.
The Prime Minister is almost half way through that 10-year period and he is—sadly—marching backwards. It is time to think again. It is time to make a new start.
§ The Secretary of State for Social Security (Mr. Peter Lilley)
I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:welcomes the fact that the vast majority of people are significantly better off today than in 1979, and notes, in particular, that the average pensioner is now more than 50 per cent. better off; approves the Government's policy of ensuring that social security spending does not outstrip the nation's ability to pay while focussing resources on those who need it most; applauds the fact that the Government has channelled an extra £1 billion a year to low income families, and an even greater sum to poorer pensioners, since 1988; welcomes the high priority accorded by the Government to education and training; recognises that employment is the best route to higher incomes, and commends the package of work incentives, including the child care disregard and the Back to Work Bonus, which the Government has introduced; applauds the Government's achievement in reducing unemployment by over half a million since 1992 and notes the fact that a national minimum wage would increase unemployment; and deplores the Opposition's failure to reveal the level of their national minimum wage, how they would deal with differentials, their social security policies and their costs.I welcome the debate for two reasons. The first is that it enables me to pursue in the House the serious issues that I raised in my Ulster Conservative Political Centre lecture, which the Chairman of the Select Committee on Social Security was kind enough to describe as the most important speech made by any Cabinet Minister for a long time.
The second is that it gives me a chance to rebut the attempts of the Opposition to revive the politics of envy on the back of the recent Rowntree report.
By contrast, we Conservatives believe in helping the least well-off, which is why we have devoted huge resources to doing so. We believe, where possible, in helping people out of dependency by giving them opportunity, choice and incentives. Our policies are succeeding better than those pursued by any of our European Community partners, as we reduce our unemployment further and faster, we raise our once dismal education standards and we enable people to accumulate savings to ensure a more prosperous retirement.
The Opposition believe in levelling down, promoting envy and encouraging dependency on the state. If they were genuinely concerned about the least well-off, they too would propose today a concrete, costed and coherent policy. Instead, they brandish statistics and glory in the gini coefficients on which the Rowntree report is based.
§ Mr. Ian Bruce (South Dorset)
Was my right hon. Friend a little surprised to be called to the Dispatch Box by the Labour party to speak in a social security debate supposedly on poverty, when the motion deals simply with employment, education and how to get people out of 813 poverty? Is it not typical of the Labour party that it believes that the way out of poverty has something to do with the Department of Social Security?
§ Mr. Lilley
Absolutely. The most amazing thing is that Labour called the debate in Labour party time, but it has not told us what its policies are. I will come to that point in a moment.
It is quite clear that, to the Opposition, the poor are not people to be helped, but simply statistics with which to beat the Government and attack the free enterprise system. It is not surprising that the hon. Member for Glasgow, Garscadden (Mr. Dewar) should seize on the Rowntree report. As The Economist, which these days is no right-wing journal, said:Unfortunately the politics of envy, though never clearly stated, lies behind (and weakens) much of the analysis in the Rowntree Report like a similar report by the Labour sponsored Commission on Social Justice … it is unconvincing as a whole.As it is Valentine's day, I will give the hon. Member for Garscadden a friendly warning. Before he and his party swallow everything in the Rowntree report hook, line and sinker, they should be careful. They must remember who wrote it—the distinguished left-wing academic, John Hills, the same John Hills who, according to The Guardian, was the principal author and inspirer of Labour's tax bombshell, which we found so helpful at the last election. It was the same John Hills who, last year, published a benefits bombshell when he suggested that there would be nothing wrong with increasing spending on social security by a further 5 per cent. of gross domestic product.
§ Mr. Lilley
The hon. Gentleman should heed my warning.
In the document to which I have referred, Mr. Hills effectively proposes a tax, benefit and incomes policy bombshell all in one. He has learnt not to put a price tag on it, but we of course may do so. The hon. Member for Garscadden should beware of that before it blows up Labour's electoral hopes.
§ Mr. Dewar
The right hon. Gentleman will be aware that we make our own policies and do not lift them from anyone's reports. Before we continue that argument, perhaps the right hon. Gentleman will establish one important thing: he does not like John Hills or where he comes from, but does he accept the accuracy of the analysis in terms of the statistics and the picture they paint? That is clearly not acceptable to many of the right hon. Gentleman's colleagues, but the Secretary of State's opinion is important. Is he rubbishing the author or the analysis in the report?
§ Mr. Lilley
I am not rubbishing either. I do not dislike Mr. Hills; indeed, I invited him to the Nottingham seminar which was attended by the hon. Member for Garscadden. I am simply pointing out that Mr. Hills has his political agenda, to which he is perfectly entitled but which has misled the Labour party in the past—[Interruption.] I will come to the figures in a moment. The important point is how one interprets the figures. The Opposition use 814 statistics like a drunk uses a lamp post—more for support than for illumination. We believe that statistics should be used to establish what we get from them.
§ Mr. Thomas Graham (Renfrew, West and Inverclyde)
I hope to make a speech later and give the facts about the people I see people living in poverty. Is the Secretary of State aware that I received a telephone call today from a local newspaper to tell me about the town of Linwood? I hope that hon. Members remember Linwood, where 5,000 people lost their jobs 10 years ago. The Government are now telling our people that they are living in poverty. In numerous areas people are living in poverty. That is a fact under this Government. After 10 years, the Government have done nothing and the people of Linwood are living in poverty.
§ Mr. Lilley
I am not sure whether it is possible to sustain that argument. We have done a great deal for the people of Linwood and for people elsewhere.
The overall picture is easily obscured by concentrating on measures of inequality.
§ Mr. Lilley
My hon. Friend is absolutely right. It is extraordinary that the Opposition cannot see the inconsistency of endorsing a document and then failing to accept responsibility for the policies that it contains and to which they say it inevitably leads.
§ Mr. Dewar
Does the right hon. Gentleman accept that there is a distinction between endorsing the analysis and necessarily accepting all the conclusions, although many of them are sound? Surely that is a simple concept for the right hon. Gentleman to grasp. I should have thought that the thrust of the Rowntree report was that resources are being squandered and spent on the wrong aims and objectives. That is the real message of the report.
§ Mr. Lilley
If the hon. Gentleman thinks that the policies proposed in the document are not merited by the analysis in the document, it would be only reasonable to tell the House why.
The Opposition are so concerned with relative incomes and extremes of wealth that they ignore what is happening to the vast majority. The simple fact is that, since 1979, the vast majority of people in this country have become significantly better off. Average incomes have increased by more than a third.
§ Mr. Lilley
I will make a little progress, if I may. So far, I have given way far more than the hon. Member for Garscadden did throughout his speech.
The report prepared for the Rowntree inquiry by the Institute of Fiscal Studies shows just how dramatic the growth of incomes in recent years has been. In the 10 years from 1961 to 1971, average non-pensioner household incomes increased by just 18 per cent. In the next decade to 1981, they increased by a further 13 per cent., but in the 10 years from 1981 to 1991 they soared by 39 per cent.—more than in the previous 20 years put together.
815 During a time of such a dramatic rise in overall incomes, it should come as no surprise that the income of different groups grew differently, and we have never tried to pretend otherwise. Moreover, far from falling behind other countries, the living standards of ordinary British people have been catching up. The latest OECD figures reported in this month's Employment Gazette are well worth reading. It states:Taking into account the cost of living, estimated average take-home pay for an unmarried UK production worker as defined by the OECD is … higher than in all other EU countries, except Luxembourg.Estimated take-home pay for a married couple [with two children] on an average production worker's earnings is higher in the UK than in all other EC countries except Luxembourg, Belgium and the former West Germanywhich were I per cent. ahead. The report continues:The relatively high level of UK take-home pay reflects in part the low cost of living in the UK compared with other North European countries and the relatively low level of taxes on employment.To most people, that rise in the living standards of ordinary people in Britain is pretty obvious and self-evident, but, to Labour and Mr. Hills, ordinary people must have become poorer because their incomes have not risen as fast as those of the likes of Mr. Cedric Brown.
§ Ms Corston
Will the Secretary of State confirm that virtually every one of the figures on which the Rowntree report is based, reflecting the growth in inequality, was released and, indeed, confirmed by his Department to me on 31 August last year, and published in Hansard on 26 October 1994?
§ Mr. Lilley
The figure on which the hon. Lady puts most weight is bracketed, which signifies that it is particularly unreliable. There are small samples and difficult issues, but I will refer to the figures and try to put them in perspective.
Let me rebut just a few points that were made by the hon. Member for Garscadden and his colleagues on the back of the Rowntree report. It is simply not sensible to claim that because the rich are getting richer the poor must be getting poorer. It is arithmetically true, of course, that, if the incomes of some better-off groups outstrip the average, there will be more people below the average, but to define poverty purely as a fraction of average income is to distort the very meaning of the word. To define it in terms of the income support level is even more perverse, because it would mean that whenever the income support safety net were raised the number of people classified as poor would increase. The Social Security Select Committee concluded that the increase in the level of income support relative to the old supplementary benefit level accounted for most of the reported rise in the number of potential claimants.
The claim that the poor have been getting poorer in absolute terms does not hold much water either. The report of the Labour-chaired Select Committee shows that the income support safety net is about 15 per cent. higher than the supplementary benefit level that we inherited in 1979. We know that benefits for an unemployed couple with two young children are 24 per cent. higher in real 816 terms now than they were in 1979, and that pensioners as a group have higher incomes now than in 1979; in fact their incomes have increased by 50 per cent.
§ Mr. Lilley
The hon. Gentleman might care to listen to what I am about to say; he may find it especially persuasive, because I shall quote the hon. Member for Garscadden, who recently said:There is … evidence, which I welcome, that retired people are on average now enjoying many more resources and a higher quality of life. That is largely because of the maturing of state earnings-related pension schemes and occupational schemes and … approved personal pensions."—[Official Report, 8 July 1994; Vol. 246, c. 606.]On top of that, the Government have focused an extra £1.2 billion a year to boost the incomes of poorer pensioners.
From April, all pensioner couples without other means will be entitled to more than £100 per week.
§ Dr. Godman
I am grateful to the Secretary of State for giving way with his usual courtesy. Will he confirm that the test case involving his Department's non-payment of invalidity benefit to women aged between 60 and 65 is to be heard by the European Court of Justice on 16 April? If it goes against the Government, as I sincerely hope it will, will the women who have been denied payments for more than three years receive arrears of payment beyond April 1992?
§ Mr. Lilley
The hon. Gentleman always asks intelligent detailed questions, usually about matters relating to the European Court. Despite my obsession with such matters I am not always as familiar with the cases as he is, but I shall certainly investigate the question and write to him after the debate.
As well as the extra resources that we have focused on benefits for least well-off pensioners, we have focused an extra £1 billion on poorer families. It is hard to pretend that the most significant groups that we normally think of as the poor have got worse off, when their benefits have been increased.
§ Mr. Lilley
I must make some progress.
The Opposition largely base their claim on figures for the bottom tenth of incomes after housing costs, as set out in the document, "Households Below Average Income", which we published at the behest of the Select Committee.
It is harder still to say that such people's living standards have declined since 1979 when the proportion of people in the bottom tenth having, for example, a fridge-freezer has risen from 32 per cent. in 1979 to 81 per cent. in 1991–92. Furthermore, the proportion with a telephone has risen from 47 per cent. in 1979 to 73 per cent. in 1991–92; the proportion with a washing machine has risen from 69 per cent. in 1979 to 86 per cent. in 1991–92; the proportion with a video has risen from a negligible figure in 1979 to 65 per cent. in 1991–92; and the proportion with a car has risen from 40 per cent. in 1979 to 53 per cent. in 1991–92.
817 Indeed, to most people the idea that more than half the people alleged to be sinking into ever-deepening poverty have none the less managed to acquire a car at least gives pause for thought—
§ Ms Harman
Does the Secretary of State still believe what he said in his speech in Northern Ireland:over the past couple of decades, although average earnings have grown strongly, the differentials have widened, and it is this widening of earnings differentials which lies behind many of our social problems—the break up of families, lone parenthood, welfare dependency, delinquency and crime"?Opposition Members are having difficulty in reconciling what the right hon. Gentleman said in that speech with what he is saying to the House in front of his Back Benchers today.
§ Mr. Lilley
Not at all. I was going to quote almost those very words when I encountered the distinct problem of the widening dispersion of earning power across the western world, which is a matter to which I tried to draw the House's attention. [Interruption.] We are a part of the western world, although the hon. Member for Peckham may not realise it. She has spent probably half her career trying to make us a part of the other world.
The fact is that the figures drawn from "Households Below Average Income" do not measure what has happened to a given group of low-income people over time. In fact, they reflect a category that is constantly changing in composition. Unemployed people accounted for only 15 per cent. of the bottom tenth of incomes in 1979, but the figure had increased to almost a third in 1991–92 at the trough of the recession. Since then, unemployment has fallen by more than 500,000 and will come down further.
Self-employment, on the other hand, increased massively during the 1980s. That is a welcome sign of enterprise and regeneration, but self-employed people have fluctuating incomes, particularly in the early stages of business formation. What is more, they can control the reporting of their incomes. They are over-represented in the bottom tenth. Indeed, if the sample is representative of the country, in 1991–92—as the hon. Member for Garscadden has reminded us—the bottom 10 per cent. of incomes included 90,000 farmers, 145,000 builders, about 40,000 taxi drivers and 10,000 accountants.
Some of those people may be struggling to keep afloat. That is why self-employed people are entitled to claim family credit and some 85,000 of them are so helped. The heavy presence of self-employed people in the bottom decile is a poor guide to the living standards of this group. That doubt is reinforced by the fact that 750,000 people report zero or negative incomes. The Rowntree report recognised that point, although it was tucked away in an appendix to the second volume.
The report stated:households reporting zero or negative incomes in 1990–91 also reported expenditure above the average for all households … the suspicion is that some may habitually misreport income to the authorities, disguising comfortable life styles. If so the HBAI picture will suggest too much inequality.818 The Opposition may not accept my assertion that the figures do not justify the conclusions that they base on them. They may not even accept Mr. Hills' qualification, but they will surely accept the views of a member of the Commission on Social Justice, Steve Webb, who works for the Institute of Fiscal Studies. He gave a seminar on this very issue, and specifically addressed my analyses of the figures. His conclusion was quite unequivocal, and it was summed up in the title of his lecture:Why Peter Lilley was right about the poverty figures.The Opposition will have a little difficulty disagreeing with a member of their own commission on that point.
When one looks more closely at the figures, one finds that there is considerable change and movement. Again, I am grateful to the Rowntree report for pointing out that some 29 per cent. of people in the bottom tenth of incomes in 1990 had moved two or more deciles two years later. If one looks at people's incomes over their lifetime rather than just at a point in time, one finds that the level of inequality between people falls dramatically by more than a half.
§ Mr. Dafydd Wigley (Caernarfon)
The Secretary of State has referred several times to unemployment causing poverty, but he has not placed much emphasis on the low-activity rates in many areas. Is he aware that the Rowntree report drew heavily on a study, "The Geography of Poverty and Wealth", by Anne Green, which was published last summer? That study showed that 10 of the 12 worst areas in Britain in terms of the activity figures were in the industrial valleys of Glamorgan and Gwent. That was causing an enormously low level of income—so much so that in Mid Glamorgan gross domestic product per head of population is lower than the Irish Republic average.
§ Mr. Lilley
The hon. Gentleman is right. There are difficult areas, and that is one of the issues that we are trying to tackle on a cross-departmental basis. Permanent secretaries, with my endorsement and support, are ensuring that our policies are co-ordinated and that they reinforce each other, whether on the single regeneration budget, the expenditure of my Department, or that of the Department for Education. We have to do all in our power to help people in those areas and I accept the hon. Gentleman's argument.
I must dispose of some other misconceptions before we consider the causes and cures for the more fundamental problem that I dealt with in my Ulster lecture. The report highlights the fall in the wages of the lowest-paid group and states:After 1978 hourly wages of the lowest paid men hardly changed in real terms and by 1992 they were lower than in 1975.That bold statement gives the impression that the least well-paid have not benefited under a Conservative Government.
I pondered the strange references and the switch from 1978 to 1975 and studied the chart in the report showing the path of wages in that period. It reveals that the only significant and substantial fall in wages—a sharp one—occurred between 1975 and 1978, under a Labour Government, and that wages have since recovered somewhat.
Inequalities of income are not more marked in Britain than overseas. Again, the summary of the Rowntree report states: 819the pace at which inequality increased in the UK was faster than in any other,"—Country—with the exception of New Zealand.As is clear, that claim is based on comparisons of countries using different years.
A more relevant indicator might be the level of inequality and not the amount or the speed with which it changed. Volume 2 of the report makes it clear that the United Kingdom is in the middle of a league table of other developed countries for income inequality. The increase in measured inequality that occurred in this country only partly reflects the unwinding of the effects of the incomes policy since the mid–1970s.
A fourth claim must be rebutted—the presumption of much of the discussion that the widening of incomes recorded in the Rowntree report was due to the fact that tax changes allegedly made the tax system less progressive. The report is unequivocal about that and states:The tax system had much the same impact in reducing inequality in 1993 as in 1977.Having dealt with some of the fallacies that have been worked up on the basis of this report, let us consider what is happening. A phenomenon of enormous significance underlies some of the Rowntree committee's concerns. As I said in my Ulster speech, the growing dispersion of earning power is probably the most significant social change affecting the United Kingdom and most other western countries. The earning power of brawn has not kept pace with that of brain.
Some countries, especially the United States, New Zealand, Australia and the United Kingdom, have responded to that phenomenon, which affects all advanced countries, by allowing earnings to reflect the changing productivity of different skill groups. As a result, each of those countries has generally experienced a greater dispersion of earnings, but more job creation and a smaller rise in unemployment.
By contrast, other countries—notably on the continent—have endeavoured to prevent wages from reflecting the changing earnings potential of less skilled people as we increasingly compete with the far east and experience the impact of new technology. In those countries, growth in inequality is slower, at the expense of higher unemployment and fewer jobs. For example, the proportion of those of working age in work in the United Kingdom has risen since 1979 and is more than 10 percentage points higher than in the rest of the European Community. Whereas, on average, in other EC countries about 61 per cent. of people of working age are in work, we have nearly 72 per cent. in work, and the percentage has been falling throughout the rest of the EC during that time.
Our strategy is to improve incentives to work, raise training and education standards, increase the number of people who benefit and boost job creation and enterprise.
On the incentives front, we introduced the child care disregard for family credit—indeed, this Government introduced family credit—and promised the back-to-work bonus as part of the jobseeker's allowance, to encourage people to take part-time work as a stepping stone to full-time work and to give them a potential £1,000 credit when they return to full-time work. We strengthened in-work benefits, not merely by introducing family credit 820 but by proposing a £10 supplement for those who work more than 30 hours a week. We are also carrying out a major pilot study to find out whether it would be effective to extend in-work benefits, equivalent to family credit, to those who have no family.
In total, my right hon. and learned Friend the Chancellor of the Exchequer and I announced a £700 million programme of work and job incentives at the time of the Budget and the social security statement.
It is no secret that, for decades and probably for a century, Britain has suffered from two great weaknesses in education and training—a lack of vocational education and the low expectations of the least able, who represent the bottom third of ability in our schools. We introduced comprehensive reforms to try to cure and overcome those long-standing defects. We introduced the national curriculum and the Labour party opposed it. We introduced testing in schools and the Labour party opposed it. We introduced the appraisal of teachers and the Labour party opposed it. We introduced publication of results and the Labour party opposed it. It is no good Labour Members deciding when their children are of an age to go to secondary schools that they support those things that improve the quality of education, but which they opposed when we tried to introduce them.
The Labour party even opposed youth training, although the noble Baroness Shirley Williams considered such a programme and rejected it. We have encouraged sensible pay for apprentices and a new, improved apprentice scheme so that people are not priced out of training. We have encouraged businesses to accept that the onus is on them to improve the training of their staff and the private sector spends about £20 billion on training.
§ Mr. Dewar
I am sorry to interrupt the right hon. Gentleman, but he is giving us a remarkably complacent view of what has been happening. Will he say a few words about the training budget this year as compared to next, and perhaps during the past two or three years, and about the number of training places? I accept that the quality of training is important, but how many training for work places are there this year and how many will there be next year?
§ Mr. Lilley
Next year, we expect there to be twice as many training places as under the last Labour Government. Perhaps that is not the standard that we should allow ourselves to be judged by—the Opposition want to be judged by a higher standard than that.
§ Mr. Lilley
It does not in any way repudiate the argument that I have just made, or the disproportionate importance of private sector training in firms. To hear the Opposition, one would suppose that the only training that was important and valid was in the state sector, whereas about 10 times as much training takes place in the private sector.
§ Mrs. Teresa Gorman (Billericay)
Does my right hon. Friend agree that, daily, thousands of people come into the country who do not have our language, who often lack skills, and who do not have capital, but who manage to find 821 work and learn to support and help their families? If they can do that, does not it show that what one needs more than anything else is the will to work and the will to get on?
§ Mr. Lilley
That is crucial and, as I said, about 29 per cent. of people leave the bottom tenth of incomes and rise, not only to the next decile, but to the one above or higher still within a couple of years. People increasingly have that get-up-and-go in our society, and we encourage that by making—
§ Mr. Lilley
I am sure that they have get-up-and-go in the constituency of the hon. Member for Renfrew, West and Inverclyde (Mr. Graham) as well.
Our strategy has been pretty comprehensively endorsed by the Organisation for Economic Co-operation and Development. Indeed, many of the measures that we have introduced have been endorsed by the Rowntree report.
The Rowntree report makes a raft of uncosted and often contradictory proposals. For example, it proposes that benefits henceforward should increase, presumably in line with earnings rather than prices. If we had done that last year only, instead of implementing the uprating of benefits costing £1.5 billion, it would have cost £3.3 billion. If we had reviewed all benefits and uprated them all in line with earnings, it would have cost about £35 billion. The impact that that would have had on the level of dependency would have been worse than the cost.
We believe that emphasis must be placed on getting people back into work. That is why we place emphasis on incentives and in-work benefits instead of complacently assuming that we simply have to make life ever more comfortable. I do not pretend that the present level of benefits is anything more than meagre in the long run.
§ Mr. Clive Soley (Hammersmith)
I should like to give the Secretary of State some time to think about the matter, but why does not he at least cost one of the most obvious things that might be done, which is to change the earnings disregard rule so that people would be able to earn something as they went back to work, or to increase their own income? Everyone knows that it needs to be done. Has the Secretary of State costed it? If not, will he do so, and will he tell the House what it would cost?
§ Mr. Lilley
We have considered it. We propose to change it by the introduction of the back-to-work bonus, so that people will accumulate a credit when they work part time on benefit, rather than being able to stay permanently on benefit with a mixture of part-time work and benefit, which would be hugely expensive.
The Rowntree report proposes to double the disregard from £5 to £10. We propose to make it £10 for a couple instead of only £5 for a couple at present, but to retain the £5 for single people.
The Rowntree disregard proposals would cost £20 million in themselves and probably more than £20 million additionally for the proposal to accumulate benefits.
§ Mr. Lilley
No; I have given way to the hon. Gentleman. It might have been more sensible for him to have found out whether the Labour party supported that proposal and was committed to it before he asked me.
Does the hon. Member for Garscadden propose to endorse that policy? Does he propose to reduce, as the Rowntree report proposes, the housing benefit taper, which would cost about £360 million to reduce by 10 per cent., or the family credit taper, which would cost nearly £200 million to reduce by 10 per cent? Does he propose to uprate all benefits, which would cost more than £1 billion extra in the first year and cumulatively increase to enormous sums? Does he propose to extend school meals to people on family credit, which would cost another £115 million?
The hon. Member for Garscadden is sitting there, almost uninterested in the concrete policies of the report that he spent half an hour endorsing.
Today's debate displays yet again the willingness of the Opposition to exploit the problems of less well-off people, while proposing no specific policies to help them. The Government have recognised the challenge posed by the dispersion of earnings power.
I have said that the purpose of my social security review is to focus benefits precisely on those who need them most. I have also described the importance that I attach to work incentives, and announced a package worth nearly £700 million last autumn. Meanwhile, the hon. Member for Garscadden opposes everything that we do, yet lacks the guts to commit himself or the Labour party to reversing it. He welcomes uncosted and costly proposals made by his friends on the Commission on Social Justice and on the Rowntree inquiry, but he will not say whether he accepts or rejects those proposals.
It is time for Labour to allow some light to escape from its own black hole. It is time for Labour to abandon the cynical politics of stooge and stealth, and recognise that our policies are those of compassion and commitment. [Interruption.] It is easy for the Opposition to call for policies to level down and policies that would trap people in dependency: that has been the cry of the left throughout the ages.
I invite the hon. Member for Garscadden to consider the saying of the famous republican orator in the Spanish civil war—it is now essential in the Cabinet to know a lot about Spain—who said, when there were demands to do away with the inequalities of Spanish society:If you want me to reduce the incomes of the rich to the level of the poor, I will do it in a fortnight. If you want me to raise the incomes of the poor to those of the rich, I will do it, but it will take us a lifetime.We have a long-term strategy to increase incomes by opportunity, by help and by incentives for the least able people. The Opposition offer nothing.
§ Mr. John Hutton (Barrow and Furness)
The Secretary of State concluded his remarks to us this afternoon by saying that the Government had shown compassion and commitment to poorer members of our community. I have yet to notice any sign or evidence that those are the Government's policies. He also told us that Labour's 823 motion was motivated by the politics of envy. I think that he completely and deliberately distorted the motion that we tabled.
In essence, we shall not be able to build a society at ease with itself against the background of increasing numbers of economically disfranchised people, the grinding and relentless poverty that comes to the attention of all Opposition Members in their constituencies, the absence of employment prospects in many parts of the country, and a future, under the present Government, that will mean more of the same. The Rowntree report effectively highlighted that characteristic of a drawbridge society. It is simply not a sustainable model on which we can build a prosperous future for our country and our citizens.
As Britain heads towards the next millennium, social and economic inequalities are reverting to a more 19th century pattern. In too many situations, life choices are distributed not on merit but on where one happens to live, on who one's parents are and on ability to pay. Discrimination on the grounds of sex, race and gender remains widespread in our communities, and inequalities in health, to which the Secretary of State barely referred, are still with us.
That depressing pattern of inequality is socially divisive and should therefore be unacceptable to any Government, of whatever political persuasion—especially as the Prime Minister, as recently as last week, confirmed that the Government accepted that tackling inequality was a duty of Ministers.
Inequality on the present scale is not only socially divisive but economically disabling, and therefore damages our future prosperity as a society. If millions of our fellow citizens are without jobs—as they are—and millions of them are without the prospect of work, they cannot he consumers, so playing a full part in promoting economic growth. As a result, social security spending becomes inflated as taxpayers struggle to foot the bill for mass unemployment. In turn, that imposes a greater financial burden on those lucky enough to be employed.
For the past 16 years, the Government's consistent response to that question has been the same: deregulation, a reduction in social protection and the laughably described "trickle-down economics". We now know that that grim experiment has been a resounding failure. Last week's Rowntree report, the central figures of which the Minister did not dispute, makes the scale of that failure extremely clear. Far from helping matters, Government policy has made matters substantially worse. Did not J.K. Galbraith describe modern Conservatism as an attempt to find a moral justification for greed?
The Rowntree report confirms the accuracy of that description and shows that incomes became rapidly less equal in the 1980s. In 1984–85, the latest date for which figures are available, income inequality was as great as it was in 1949. Since 1979, the lowest-income groups have not benefited from economic growth, while better-off groups have enjoyed improved standards of living. Therefore, up to 30 per cent. of the population have not shared in the improvement in economic growth since 1979. Since 1977, the proportion of the population with less than half average income has more than trebled. As we all know, during the 1980s more people became dependent on means-tested benefits.
824 That is a dismal catalogue of incompetence and indifference, of which we saw plenty of examples in the Secretary of State's speech today. A number of factors have contributed to that catalogue of incompetence. First, the Government have been prepared to tolerate levels of unemployment that would have been unthinkable even 20 years ago. Unemployment averaged about 300,000 throughout the 1950s, less than 500,000 throughout the 1960s and about 1 million throughout the 1970s. Throughout the 1980s—the period of Conservative Government—it averaged 2.7 million, and long-term unemployment remains a problem. A third of unemployed men and a quarter of unemployed women have been out of work for more than 12 months. The comparative figures in the United States are 8 per cent. and 5 per cent. respectively. We have a huge burden to shoulder because of the incompetent way in which the Government have managed our economy since 1979, and the consequences of their failure are becoming daily more visible.
Unskilled workers have borne the brunt of the Government's callous tolerance of mass unemployment. Less than 20 years ago, nine out of 10 men who had left school without qualifications were in employment. Today, the figure is seven out of 10 and is still falling.
Secondly, the Government's education reforms have failed to improve education standards for the majority of our children. For example, we have the lowest under-fives provision in the European Union alongside Portugal, and far lower numbers—although they have increased in recent years—attending university than Japan, Germany and France.
Thirdly, the Government have refused to listen to anyone who has drawn attention to what has been happening in our society. The Secretary of State's speech this afternoon was another example of that. Instead, the Government have chosen systematically to ignore the growing evidence that things are going badly wrong for a growing number of our fellow citizens.
A fourth factor which explains the mess that we are now in is the combined effect of the Government's tax and benefits problems. Over the past decade, the poorest 10 per cent. of households have lost 156 a year in higher VAT, national insurance and other taxes. By contrast, the wealthiest 10 per cent. have gained £1,612 a year as a result of income tax cuts alone. The biggest gains of all have gone to the top 1 per cent. of the population—those with average incomes of more than 120,000 a year—for whom the cumulative gain from tax cuts since 1979 has been a staggering £75 billion. That is almost the equivalent of the entire annual budget of the Department of Social Security. When all tax policies over the past 15 years are taken together, the poorest 10 per cent. of the population now pay a higher proportion of their income in taxes than the richest 10 per cent.–43 per cent. and 32 per cent. respectively.
In Cumbria, the position has substantially deteriorated over the past 10 years. The most disadvantaged wards in the county of Cumbria had a lower measure of economic prosperity in 1991 compared with 1981. Over the same period, the extent of economic disadvantage in those wards increased. Most of the deprivation in Cumbria can be found in Carlisle, along the county's west coast, and in the Furness area. However, much of the economic disadvantage in Cumbria is concentrated in my constituency, which includes four of the five most deprived wards in Cumbria.
825 Present Government policies are simply inadequate to deal with the scale and extent of that disadvantage. If the Secretary of State wants examples, he should attend some of my advice surgeries on Fridays and Saturdays, when he could see the real position at first hand. It is not as he described to the House this afternoon, when he said that growing prosperity was shared among all income groups and across every community in the country. In my constituency, the position is close to a crisis.
Unemployment lies at the background of many of those problems. It is extremely high in many parts of my constituency, where more than 10,000 jobs have been lost since 1990. There is growing evidence of low pay in Barrow and throughout the north. The problem of unemployment particularly affects women in Cumbria, whose average earnings are 11 per cent. lower than nationally. More than a third of Cumbrian women are on low wages, compared with a national average of only a quarter.
Health indicators in my constituency and the north paint an extremely grim picture. In 1992, the northern region had the highest mortality rate in England and Wales, as measured by the standard mortality ratio. The death rate in the northern region was 13 per cent. higher than the average in England and Wales. In Barrow-in-Furness, that rate is 15 per cent. higher than the national average. Those are not bogus or fabricated statistics; they are Government statistics.
Those are the consequences of Tory economic mismanagement combined with incompetent social and taxation policies, which have demonstrated consistent disdain for those of our community who are forced to live on benefit. I am sorry that the hon. Member for Billericay (Mrs. Gorman) has now left the Chamber. She expressed the view, which is commonly shared among Conservative Members—perhaps not by all those present, but we have certainly heard it before—that the solution to unemployment is to get tough with the unemployed because they are to blame. The theory is that, if the Government prod unemployed people harder and harder, they will find jobs. The truth is that the jobs are not there. They do not exist in my constituency—[Interruption.] If the hon. Member for Twickenham (Mr. Jessel) would like to come to my constituency, he would discover that 4,500 unemployed people are chasing 230 job vacancies registered at the jobcentre. There is simply no credible or logical strategy in forcing our unemployed constituents into a fruitless search for jobs that simply do not exist. Moreover, they constantly face the prospect of losing benefit because they are deemed not to have complied with rules set by the Government.
Unemployment is central to the topic of today's debate. It underlines a clear pattern in the growing inequality of deprivation across the country; in pockets, it is now completely unacceptable, both morally and economically. The solution lies with a policy designed to secure full employment, which recognises that full employment is a responsibility of Government. The damage to health caused by mass unemployment is clear. Unemployed people are much more likely to suffer a chronic illness or disability. For example, a middle-aged man who is made redundant or takes early retirement is twice as likely to die within five years as a man who stays in work. Unemployment can also have a devastating effect on 826 psychological health. That has been confirmed by recent research in Edinburgh and Oxford. Unemployed men are between 10 and 15 times more likely to attempt suicide than employed men. That is the reality; it is not as the Secretary of State described to us tonight.
It is also clear from the Rowntree report that urgent action is needed across a range of Government Departments if we are to tackle the distorting effects of growing inequalities in Britain. We need a national debate about how we can bring about a sense of national renewal with full employment, a fair tax system and a modern welfare state as essential preconditions for any return to decency and sanity in our society. Bringing about such a transformation will be Labour's big ideal when we resume responsibility for the government of Britain into the next century.
§ Mr. Patrick Nicholls (Teignbridge)
One of the reasons why these occasions are invaluable is that they give me an- opportunity to debate with the hon. Member for Glasgow, Garscadden (Mr. Dewar). I have enjoyed debating with him before, but this is not one of his better efforts. Although no one can doubt the sincerity of what he said, it seemed to me that he was fixing on a prescription and a definition of poverty that simply do not exist. One cannot begin to get to grips with a problem unless one knows what one is talking about in the first place.
There is no doubting the sincerity of the hon. Member for Garscadden or the hon. Member for Barrow and Furness (Mr. Hutton), but they were defining poverty in terms of the gap that exists between the rich and the poor.
It is easy to fall into sloppy language and sloppy thinking, but sincerity does not justify that sloppy thinking. It is completely ridiculous to define poverty in terms of the gap between the rich and the poor. It is tantamount to saying that people are better off in countries where the living standards of the poor are lower, but the gap is narrow, than they are in countries where the gap is wider, but the living standards of the poor are improving. That is the reality of the language about gaps. Frankly, it is complete nonsense.
The hon. Member for Garscadden talked about seeing people in his surgery and wondering how they survived under strains and pressures that he had never understood. I quite understand the sincerity of his feelings and his compassion for those people, but perhaps he should talk a bit more to them. Perhaps after a period of Labour Government he should tell them, "Guess what? You are much better off now because the gap is narrower." What help is such language to impoverished or unemployed people? They cannot pay their bills with a gap or take it along to a building society and say, "The gap has narrowed, therefore I must be better off." They cannot pay the milk bill with a gap.
The gap itself means nothing whatsoever. What is relevant is the money that the poor actually have. Opposition Members should also remember that the lowest standards of poverty in Britain would be regarded as well beyond most people's dreams in other parts of the world.
Poverty is an absolute measurement. One cannot talk about it in terms of gaps. A few moments ago, the hon. Member for Barrow and Furness equated the language of 827 the gap with saying that the rich have had tax handouts. Let us get it clear. The rich have not had handouts from the Government; the Government have simply taken less money from them than the previous Government did. It is about time that the Conservatives had the courage and confidence to say that, whether a taxpayer earns £10,000, £100,000 or £1 million, every single penny–100p in the pound—belongs to him. The Government give nothing; they simply take away. The idea that the poor have been prejudiced because the Government have given money back to the taxpayer—although one does not doubt the sincerity of the language—is sloppy thinking and sloppy thinking does not help the most vulnerable.
I accept that—it will be common ground on both sides of the House—we have to consider those who have to pay tax. On the one hand, if we tax people 100p in the pound, they will do no work; on the other, if we tax them zero pence in the pound, we will raise no tax. Obviously, somewhere between those two extremes there is a level of taxation that will provide the money that the Government need to discharge the functions that are necessary to help those who cannot look after themselves and will enable them to provide enough incentive for those people capable of earning greatly to make them continue earning and paying tax.
When I first started work as a solicitor's clerk in the 1960s, I remember trying to retain a particular barrister who was very popular. I telephoned his clerk in chambers and he said, "Is that a case for a Thursday? Counsel does not work on a Thursday." I said, "Surely the courts sit on Thursday." The barrister's clerk said, "Obviously, you do not understand. Counsel works on Monday, Tuesday and Wednesday, but have you not heard that the tax rate is 89p in the pound? He does not work for the rest of the week. It is not worth his while." That was the position under the Labour Government. Where is that ideal tax line? It is known in economic terms as the Laffer curve.
The hon. Member for Birkenhead (Mr. Field) understands the debate and I wish he were here today. In 1986, he asked a parliamentary question about taxation. In addition to having prodigious knowledge and talents, the hon. Gentleman has a keen sense of humour and one never quite knows whether the answer to his question was a surprise or something that he had expected. He asked the Treasury to provide a calculation of the proportion of the total income tax that was paid by the rich under the Conservatives and the proportion of the tax take that they had paid under the Labour Government.
Those who talk about giving money to the rich and the gap between rich and poor would assume that if the tax rates came down, the amount of money that the rich contributed to the welfare of others would also go down—not a bit of it. The answers to the questions from the hon. Member for Birkenhead revealed that, as tax rates had come down, the amount of money that the rich contributed had gone up.
That is an inconvenient piece of thinking for the class war worriers who talk about gaps and think that people can pay their bills with gaps. It produced an answer that they find difficult to accept. When the Government leave the rich with more of their own money, there is more money to spend on those who need it. Indeed, we have seen a hint that behind the Follettised exterior lurks a Stalinist soul and the idea that at the end of the day there is not an ever-growing cake; there is a fixed cake out there 828 and the question is how to slice it up. The marvellous thing is that behind the designer suits are the same old prejudices.
Where does one go from there? We had the fact that the rich are contributing more. I am surprised that Sir fain Valiance has not been mentioned here today.
§ Mr. Nicholls
I am pleased about that and I am quite happy to mention him again. I understand that he earns £1 million a year. That has two advantages. First, it enables me to do income tax calculations on my feet and, secondly, it enables me to talk about the contribution that Sir Iain Valiance has made to the poor of the country. Even under the present Government, he will have paid approximately £400,000 into the national coffers to be used in ways of which Opposition Members would approve.
In the bad old days, what happened to people who earned that sort of money? Either they simply stopped work on Wednesday, like my barrister colleague, or they fiddled or went into various schemes which existed to exercise an accountant's ingenuity but really were to save tax. Ultimately, they went abroad. These days, they are here paying their tax. Coupled with that, the idea that we are giving handouts to the rich and the question of the gap become relevant.
The final nonsense which I expect the hon. Member for Rotherham (Mr. MacShane) will stand up and justify in a moment is that poverty can be defined by the level of benefits. It really is profound cheek for Opposition Members to urge at every turn an increase in benefits and then, the moment there is an increase in benefits, to turn around and say that there must be more people in poverty.
§ Mr. MacShane
I am grateful to the hon. Gentleman for giving way and telling us again the pet theory of the Laffer curve which no economist takes seriously any longer. Is it better to have Sir Iain Valiance earning £1 million and paying £400,000 in tax than some of the 50,000 people he sacked earning £10,000 or £20,000 and all paying tax? In other words, perhaps we should consider the labour market policies of Japan, Switzerland, Germany or northern Europe, rewriting the whole tax base, rather than hoping that a handful of the rich will throw some crumbs to the poor via the Treasury.
§ Mr. Nicholls
The kindest thing that one could say about that intervention is that it was completely daft. The idea that there is some correlation between a multi-billion-pound business which has to decide whether it needs a particular staffing level and saying that if Sir Iain Valiance received a smaller salary more people could be employed is ridiculous.
The hon. Member for Rotherham confirms either that that is ridiculous or that he is daft—I am not sure which, but it matters not. The logic of the hon. Gentleman's argument is that everyone could do Sir Iain Valiance's job and therefore everyone should be on the same sort of salary. It is a profoundly silly argument. The idea that efficiency will be increased by imposing penal rates of taxation on those who are truly talented and by overburdening businesses through overmanning is the product of a bygone age. I am surprised that the hon. Gentleman should advance that argument today.
829 Having disposed of the language of gaps and handouts—the idea that the rich are in some way the problem whereas, in terms of the money that is needed, they are part of the solution—it is worth while examining what the real problem can be. The cause of poverty, and the breakdown of family life which goes with it, is not that the level of benefit is not sufficient but that the level of benefit is too great.
The American sociologist, Charles Murray, has done some work in this area—both to the right and to the left academically. The breakdown of society in parts of this country is similar to that which occurred in America. The state is no longer the father of last resort; it has become the father of first resort. What does it do to the confidence and moral well-being of a family unit when, at a stroke, the state is prepared to maintain the wife and the children of a union at a greater level than the breadwinner could expect to maintain them himself? That undermines the social fabric and increases poverty dramatically.
The figures speak for themselves. We do not have time tonight to examine Charles Murray's work and statistics. However, a report which appeared in today's Daily Mail illustrates my point. The article is entitled "Who needs work?" and refers to a family of five who are living on benefit and netting about £18,500 per year. In a phrase which I think sums up the situation very well, a family member says:Wages are disgusting at the moment".I think that quite a few people would retort, "She would say that, wouldn't she?" That family receives take-home pay of £18,500 a year gratis by virtue of the taxpayer.
What would people have to do to earn wages of that sort? Firefighters do not earn that much money, nor do ambulancemen, midwives, metal workers, prison officers, senior computer operators, classroom teachers, Army sergeants, junior doctors, first-year registrars or ward sisters. Speaking personally, perhaps the good news is that it is £3,000 a year short of what a Member of Parliament earns—but perhaps that will alter in due course.
Why should people work in accordance with their own skills and abilities when someone can sit at home and net that sort of money at taxpayers' expense? That is not about the alleviation of poverty; it is about the creation of poverty, because it impoverishes people's ambitions and desires and their ability to work.
In addition to that sum, the Department of Social Security made the sort of mistake that it is easy to make—it popped a cheque of £6,000 extra into the post. To be fair, the mistake was discovered 10 days later, but by then it was too late. What had happened to the money? About £1,000 had been spent to buy mountain bikes for the children for Christmas, £600 had been spent on a fitted kitchen and hundreds more pounds had been spent on new furniture. None of the money was spent to clear the £1,000 in rent arrears which had resulted in the family's eviction from a previous council house. The article goes on to say that the couple concernedare trying to persuade Wolverhampton Borough Council to allocate them a three or four-bedroom house".That encapsulates what the problem of poverty is really all about: the state has gone so far down a particular road that, instead of encouraging people to stand on their own feet, it mocks their efforts by completely undermining 830 their ability to do so. In the end, it is not enough to say that that is the way in which the scales are balanced, the scales have been applied by Parliament and the adjudication officer can always challenge the outcome. We have to look beyond that argument.
We have to ask whether the benefit rules should be changed drastically. We have to ask whether, having served due notice, we should tell people that the maximum benefit that they can obtain for themselves and their families is the regional average for a person without skills and experience. If we do not do that, we will undermine the position of those who think before they have children about whether they can measure up to their responsibilities. We will undermine the position of those people who come to my surgery and tell me that they cannot get a council house because they do not have enough children, but that they do not want to have more children until they can bring them up in a safe, secure environment. If we do not address that problem, we will create poverty.
We can examine the amount of money which the Government have devoted to addressing poverty at the taxpayers' expense. For all Labour Members' sincerity, it is easy to expose the nonsense of the idea of relative levels of poverty, benefits equalling poverty, and so on. If we do not address those vices, the situation will become a powder keg. I hope that the debate tonight will stimulate the thought process and we will begin to address those issues.
§ Mr. David Chidgey (Eastleigh)
I pass on to the House the apologies of my hon. Friend the Member for Rochdale (Ms Lynne), who is unable to attend the debate as she is serving on the Committee which is examining the Disability Discrimination Bill. She asked me to mention that she would have been here if she had not been otherwise detained.
The aim of any civilised and democratically governed country must be that its citizens should be free from the spectre of poverty. I have listened to most, if not all, of the speeches this evening and I think that all hon. Members agree on that point—that people can be enabled to develop their skills and their talents fully; that they can be engaged in worthwhile employment to the benefit of themselves, their families and our society.
It must be a priority to develop and implement policies which enable citizens to live and to work in healthy surroundings, motivated to contribute to our society. A prime function of Governments must be to provide a ladder of opportunity to those who slide down into poverty and despair through unemployment.
Let us not forget the scale of unemployment and the way it has grown in this country in the past four decades. The figures are quite staggering. In the 1950s, the unemployment rate was 386,000 per year. By the 1970s, it was some 976,000. Today it is about 2.5 million, counting only those claiming benefit.
§ Mr. Chidgey
Indeed. Unemployment is linked inextricably to poverty. In 1979, some 5 million people were living on incomes which were less than half the national average wage. About 58 per cent. of that number 831 were unemployed. By 1991, 13.5 million people were living on less than half the average income, of whom some 78 per cent. were unemployed.
We have heard it argued that that is the result of a general rise in incomes and that, on average, we are all better off. However, it is important that the House should not deny the outcome of the Rowntree report. The Minister said that he was cognisant of it and that he set great store by what it said. We may argue about the statistics, but let us not forget the report's underlying theme.
Income inequality in this country has grown faster and gone further than in any other comparable industrial country. The poorest 20 to 30 per cent. of the population have not benefited from rising national prosperity. Since the 1980s, the incomes of those who are dependent on social security benefits have fallen further behind the incomes of those who are in work.
Just as poverty is linked inexorably to unemployment, so is poor and degenerating health. Unemployed people are less healthy, both physically and mentally, than those who are in work. As the hon. Member for Barrow and Furness (Mr. Hutton)—who has unfortunately left the Chamber—pointed out a few moments ago, unemployed middle-aged men are twice as likely to die within a decade as those who are employed.
The long-term unemployed have weak social support systems and they tend to congregate with other unemployed people. They tend to have a poor social structure which leads to the breakdown in family life. It is interesting to note that divorcing couples are twice as likely to be unemployed as those who are in stable marriages. The mortality rate of children under four years of age is three times higher in the lowest income group than in the highest income group. Deaths from asthma and from similar ailments among children under 14 is twice as high in the lowest income group as in more affluent families.
It is a stark reflection on the division between the poor and the mainstream in our society that Oxfam, a charity established to provide aid and support to impoverished peoples in the third world, is actively considering projects targeted at poverty in the UK. It is against the backdrop of unrelenting long-term unemployment, increasing poverty and widening division in our society that I believe that the Government's policies must be tested.
What, for example, has been the record of the training for work programme? A major stumbling block has been that it has not targeted the long-term unemployed. Those out of work for more than 12 months occupy a minority of places on those schemes—some 42 per cent. last spring. That is broadly in line with the proportion of long-term unemployed within the overall jobless figures. There is little incentive within the schemes for training and enterprise councils to target the long-term unemployed.
TEC schemes concentrating on the long-term unemployed find it more difficult to meet the Government's targets for "outcomes". Less than one third of those out of work for between one and two years entering a training for work scheme end up with a continuing job. For those who are out of work for more than two years, the record is even more disturbing. Less than one in five ends up with a permanent job. Overall, of those entering training for work schemes, more than 832 half end up unemployed and less than a quarter complete their training with a qualification or even a credit towards one.
The Government have decided to cut training for work funding by some 20 per cent. That would be a positive move if the funds were redirected to schemes aimed at getting the long-term unemployed into work, and providing the training that they need to keep them there. But the recent Budget proposals provide little incentive and even less investment. They fail to get to the core of the problem. The much heralded extension of the community action programme has the net result of a reduction in places of some 10,000 compared with the current provision of 50,000 this year.
The introduction of the jobseeker's allowance will deny benefits to some 90,000 people at a time. It will extend means testing and—as is widely argued outside the House—could create disincentives for people to move into work.
The whole tenor of the Budget was to force the jobless from out-of-work benefits and thus into in-work benefits. The JSA and other schemes will have the power to force and coerce the jobless into poorly paid, insecure and dead-end jobs. There is little provision for high-quality training, which is essential to improve employability in the long term.
The one glimmer of light from the raft of the proposed measures to date has been the workstart pilot schemes. The evaluation of the four pilot projects—released, I believe, a month or so ago—shows that nearly 80 per cent. of the participants are likely to be offered permanent jobs. I welcome that. That is an important result from a pilot scheme which shows us what we can do in the future.
Sadly, the Government's response in the Budget was to launch yet another pilot scheme involving a mere 5,000 of the long-term unemployed. With nearly 1 million people on the long-term unemployment list, each costing our economy some £9,000 per year in terms of benefits and lost taxes, here was the chance to grasp the nettle, to take some active measures to try to resolve the problem. I wanted to see a national benefit transfer programme introduced: instead of the benefits being paid to the long-term unemployed, they would be transferred to the employers, as a training subsidy, to improve skills and to secure worthwhile, permanent jobs.
I am sorry that the Secretary of State had to leave, but I wrote to him on this very subject in October last year. I urged him to build on the success of the pilot workstart schemes. His Department replied in November, saying that it was too costly. I wrote again and asked him what the costs were—bearing in mind the fact that it costs us £9,000 per year for every person who has been unemployed for more than a year. I am advised that my queries have now been passed to the Employment Service. I await its reply with some interest, because we should get to the bottom of the figures and show why it is costing so much when we could be saving so much more.
The Government's proposals to tackle long-term unemployment lack imagination, application and conviction. For example, instead of providing a national insurance contribution rebate for 12 months to employers who take on long-term persons, the Government could have taken on board our policies, which would eliminate the lower rates of employee national insurance contributions, taking 50,000 low-paid workers out of tax altogether.
833 To help small businesses—the job creators of the future—the Government could have taken on our proposals to raise the VAT threshold to £60,000, which would take 125,000 small businesses out of the VAT net. But most importantly, to tackle long-term unemployment and the poverty that it causes, there must be a programme of long-term investment: in a citizens service—as we propose—which would provide opportunities for some 250,000 unemployed people to gain skills for the first time, or to share their skills with young people who are inadequately trained or who are becoming long-term unemployed; in public transport and in our public infrastructure to provide jobs now; and in education and high-quality training, to provide the skilled work force that we need if this country is to compete successfully in the global market-place.
I can only endorse the conclusion of the Rowntree report. We can bandy the statistics around the House until tomorrow morning, if we so wish, but let us look at the conclusion of the report:Market forces, left to themselves, cannot deliver the investment that will most benefit the economy and society as a whole.I urge the Minister to think again, to recognise that mass long-term unemployment is not acceptable in our society and to accept and implement the policies that are at hand to tackle it.
§ Mr. Toby Jessel (Twickenham)
There must be huge sympathy from the whole House for the long-term unemployed, to which both the motion and the amendment refer. The boredom of long-term unemployment, the feeling of waste, the lack of self-respect, and sometimes the loss of hope, are very severe in their effect on individuals and their families. I for one do not agree that it can simply be resolved by the will to work.
The will to work can sometimes help, but it is not always enough. Many of the long-term unemployed are decent. honourable people who are unemployed through no fault of their own. The causes of their unemployment are several, but they certainly include the world trade recession, which in recent years has had a severe impact on employment in all the main industrialised countries, not only in Europe but throughout the world. Of course, a recession in world trade tends to hit hardest those countries which are dependent on trading if—due to relative over-population for the size of their countries—they have to import and export more in order to survive than more sparsely populated countries such as France or the United States, which are likely to be more self-sufficient. As Britain is one of those over-populated industrialised countries, the world trade recession was certain to bite very hard on us and severely damage employment, with the dreadful effect on individuals and families that I have just described.
Secondly, there is the changing technology. I was interested in the reference earlier in the debate to redundancies at BT. I have to declare an interest in BT as it sponsors concerts in which I perform, although I am unpaid. It is, of course, a company which has been greatly involved in modernising its technology and in computerisation, electronics, and so forth. That increase 834 in technology will have reduced the number of jobs, but if it has resulted in keeping down the price of telephone calls and the price of BT's other services, it means that its customers have more money in their pockets to spend on other things. That purchasing power will generate employment in other ways. When considering these matters, one should always look at the knock-on effects.
As the Secretary of State said, unemployment is now falling. It is falling quite fast: it has fallen by half a million in the last year or two. That is a very substantial number. It leaves a tragically large number still unemployed, but it is substantial—it is far from negligible. I have been very surprised that not one Opposition Member has shown any pleasure at the fact that unemployment is currently falling quite fast.
The fact that unemployment is falling fast is due, admittedly, to the beginnings of an upturn in world trade, although Britain has come first of the countries in Europe and among the first in the world in that upturn. I believe that the fall in unemployment is at least partly due to the United Kingdom's having come out of the exchange rate mechanism in the summer of 1992, which I advocated and which I believe was the right thing to do. It had to be done—there was no choice, eventually—and I wish that it had been done sooner. That enabled interest rates to drop further than they had already begun to drop, and faster than they would otherwise have dropped.
Increased purchasing power for individuals and companies who were not having to pay out so much in interest increased the profitability of businesses and their propensity to take risks and make positive investment decisions. I am quite sure that coming out of the ERM has been one of the causes of the improvement in our economy, and I am very surprised when sometimes some people seem to deny it. But it is only one of the causes.
Another cause has been the highly successful management of our economy by the present Chancellor of the Exchequer since he took office. We now have a real growth rate of about 4 per cent. per year in our economy, and that is having a substantial impact on the number of people employed and the reduction of unemployment.
I believe that it is very important indeed to keep that reduction in unemployment steady—falling at a fairly steady rate. It is very important not to try to hike it up artificially: if we do, we shall get once again a speeding up of inflation, which will threaten the very unemployment that it is intended to diminish. The inflation will increase the price of British goods sold overseas, which will limit our opportunities to sell overseas and damage the very employment to which both the motion and the amendment refer. It is vital for employment—I am surprised that Opposition Members have not mentioned this—not to allow inflation to let rip, but to keep a very steady and strong hand on the tiller and not be tempted.
I believe that there are three main threats to the drop in unemployment and the improvement in employment. Two of those come from the Labour party. I should be grateful if the hon. Member for Peckham (Ms Harman) would kindly do me the courtesy of listening as I am about to refer to her party policy.
It is very important that the Labour party is not allowed to encourage, by what it says on employment, any increase in inflation. Secondly, it is very important that the party is never allowed, and never given the
835 opportunity, to bring in the minimum wage that it has proposed, because that would diminish employment prospects, too. But at least we know where we are with the Labour party on that: it would bring in a minimum wage. We would not bring in a minimum wage. The hon. Member for Eastleigh (Mr. Chidgey), who has just spoken, was of course quite unable to say whether his party would bring in a minimum wage or not. He is sitting on the fence, and his party conference disagreed with the leadership.
§ Mr. Chidgey
It is perfectly clear to anyone who reads our policy documents that we are in favour of a regional minimum wage. I did not mention it in my speech, however; the hon. Gentleman must have been listening to someone else.
§ Mr. Jessel
How can we know, if the hon. Gentleman's party conference blatantly contradicts the policy of the leader of his party as to what he would do? But as his party does not stand the remotest chance of ever being in office—indeed, when the general election comes his party is highly likely to lose some seats below the fairly small number that it has—this is not a matter which is ever likely to be put to the test.
The third threat to employment—a very serious one which has not been mentioned at all in the debate so far—is the enormous industrial growth of the Pacific rim. As in Britain 40 per cent. of our exports go to the European Union and the other 60 per cent. to other parts of the world, this is an extremely serious matter for us, because that 60 per cent. of our exports will be in competition with exports from the Pacific rim countries. So often we hear discussion, both in this House and in European assemblies, about trade within Europe, and there is not nearly enough discussion of Europe's exports to and trade with the rest of the world.
Let me put the position as it affects employment into perspective. Going back 30 or 40 years, everyone was aware of the growing industry in Japan—first in cameras, then in audio equipment, then in cars—and of how all those were selling all over the world. Then we found it emanating from countries like Taiwan, Hong Kong, and North and South Korea. Now we are into a sort of third wave. Many countries in south-east Asia and the far east are developing industries. I went with a Commonwealth Parliamentary Association delegation to India two years ago. The threat to our export industries from the type of modern industry that one can see in Bangalore, and hence the threat to our employment, is very significant.
In Bangalore there is a factory making a telephone exchange—the size of a rugger ball—which can sell to any village, and the telephoning can all be done now by radio, or at least without wires, through this mini-exchange which costs about £3,000. It is selling now to villages all over Asia, Africa and other parts of the world. There is a huge growth of industry in China and a huge growth in Indonesia, the Philippines, Thailand and all over the far east. It is burgeoning, and it is a huge threat to employment in this country. I believe that the policies of the Government must be directed more to how we are to uphold our employment in future in the face of this tremendous threat to it from the far east and south-east Asia.
One of the main causes of poverty, however, has nothing to do with unemployment. The hon. Member for Eastleigh said that unemployment was tied inexorably to 836 poverty—or it may have been the other way round—but it is certainly not true that the sole cause of poverty is unemployment or the state of the economy. I find in my constituency that a major cause of poverty is the existence of single-parent families in large numbers. I am not making any kind of moral judgment; I am just saying, as a matter of fact, that they come to my surgery and write to me. I know that they exist in large numbers, and indeed the remarkable document, "Social Trends"—which was published a week ago—refers to the increasing number. One third of births in this country are now out of wedlock, and "Social Trends" says that marriage is a declining institution in this country, as we all know already. Some of the single-parent families are due to deserting husbands or deserting lovers who have jilted their wives or their partners.
§ Ms Corston
I note the hon. Gentleman's concern about the growth in single-parent families. Will he explain what policies he would support and propose to the Government for improving child care so that those women do not have to be dependent on the state; they sure as hell do not want to be dependent on welfare?
§ Mr. Jessel
Of course we need more child care. The hon. Lady will have heard the Prime Minister speak of an increase that he intends, as Government policy, in nursery education and, presumably by the same token, in the provision of play groups. But that is to deal with the symptoms rather than the cause of the problem.
The cause of the problem is the increase in the number of single-parent families. In some cases, the women concerned may wish to have children without being married. In other cases, it may happen because they have been seduced. Whether it is intentional or not, it is tending to increase and it is a major cause of poverty. Unless there is some change in that cause of poverty, it is likely to continue. I mention it because it is completely false to attribute all poverty to the state of the economy or to unemployment.
I wish to turn from that to the subject of diet.
§ Mr. Roger Godsiff (Birmingham, Small Heath)
I represent a constituency with one of the highest percentages of single-parent families in the country. The hon. Gentleman has referred to, as he sees it, the problem of young ladies being seduced. Would he like to enlighten the House as to what his policy would be to try and stop them being seduced?
§ Mr. Jessel
I think that I might be called to order by Deputy Speaker if I attempted to give a full answer to that very interesting question, but I will take the hon. Gentleman aside afterwards, if he wishes, and explain to him the facts of life, which I think go beyond the scope of this debate, if I may say so, Mr. Deputy Speaker.
I was about to turn to the factor in poverty of diet. "Social Trends" gives a considerable description of changes in the pattern of diet. I hope, Mr. Deputy Speaker, that you will consider this as relevant because other hon. Members have referred to health and education in the context of poverty and the content of diet undoubtedly affects people's standard of living. It is most interesting to see that in the past 20 years there has been a substantial drop of about two thirds in the consumption of sugar, which was a staple for poor families, and a drop in the consumption of beef, veal and eggs—the beef and veal, of course, being relatively expensive items and the eggs a 837 sort of half-way item. The Information about healthy eating, whether in terms of cholesterol or in relation to an excessive intake of calories, has diverted people away from those diets. They are eating instead more fruit, more chicken and more cereals.
If more people could be encouraged to have allotments and to grow their own vegetables, if they are in poverty, that would help to relieve their situation. In my constituency, about one third of the allotments are out of use. No one wants to be bothered to grow his own vegetables. People sit in front of the television for hours on end, complaining about their poverty and not growing vegetables when they could do so easily and cheaply. [Interruption.] The president of the National Society of Allotment and Leisure Gardeners Ltd., Lord Wallace of Coslany, is a distinguished Labour Member of the other place. Opposition Members of this House would do well to stop laughing and encourage people who are feeling the pinch—as unfortunately some people are, whether due to unemployment or to other reasons—to go out and take an allotment. That would be a positive step, which could be a healthy activity and at the same time relieve poverty.
Of course expectations change. Going back 50 years, people's idea of poverty was completely different. Today, everyone expects to have a television, for example. I believe—and the Minister will correct me if I am wrong—that more than 40 per cent. of pensioners in this country now run cars, or more than 40 per cent. of pensioner households, including married couples who are pensioners, whereas 20 years ago the figure was only about 20 per cent. That is a remarkable social change and shows that an increasing number of pensioners are not in poverty.
I like to think of elderly people driving around in cars, making visits and going to see their children and grandchildren, which they can do more easily thanks to the large number of main roads that we have built, as these days most people live in a different place from their grown-up children and their grandchildren. It is a fact about the pensioners' standard of life, which contradicts those who say that this country is living in poverty, that so many pensioners now own cars.
Likewise, I have found from our Library here in the House of Commons, which sent me a paper on the matter this morning, that 57 per cent. of households have access to a video, which would never have been the case 20 years ago as there were not any around; that 78 per cent. of the poorest 20 per cent. have access to a freezer; that 85 per cent. of the poorest 20 per cent. have a fridge; that 73 per cent. have central heating in their house or their flat; and that 72 per cent. have a telephone.
Some people are therefore exaggerating the amount of poverty in this country. It remains a serious problem for some people, and we must strive to continue the improvement in our economy, so as to mitigate poverty, but I believe, with Abraham Lincoln, that one cannot strengthen the weak by weakening the strong. The egalitarian policies of the Opposition will, in the end, not benefit those who are in poverty, but will have the reverse effect. So I hope that the House will, by a decisive majority, support the Government amendment and reject the Opposition motion.
§ Ms Mildred Gordon (Bow and Poplar)
I was very surprised to hear the Secretary of State for Social Security trot out that hoary old phrase, "the politics of envy". I think it was indicative of his callous approach to the problems of poor people. Does he condemn poor people as being envious, when they aspire to have good clothing, good diet, good education and a neat warm home for their children? When richer people rightly want to give their children the best of everything, that is described as a laudable ambition. When unfortunate people sleeping in the streets envy those of us in our warm beds, are we to condemn that?
It has been my opinion for a long time that working-class people do not demand enough. They are too easily satisfied. They are not envious enough. They set their sights too low and they allow themselves to be ripped off time and again by this Government. Pensioners whose pensions are no longer linked to wages have been ripped off by the Government. Women pensioners, whose pensions are lower than those of men, will be ripped off by losing five years of their entitlement. That will add to the number of women who are living in poverty, and it is women who are the largest proportion of the poor.
When those who have paid national health insurance contributions all their lives are old and need help from the health service, they often find that the help that is needed in hospitals and in the community is no longer there. Those who paid their national insurance contributions in the expectation that, if they were ever unemployed, they would be taken care of by the safety net of the welfare state will now lose half their entitlement. All those people are being ripped off by the Government.
Conservatives rubbished the Rowntree report as left-wing propaganda, but very few noticed that it was in fact in full agreement with a series of reports on deprivation published the previous week by the Department of the Environment. The Department of the Environment has not exactly been known for left-wing propaganda. Its reports set out the stark facts of poverty at the beginning of the 1990s. They showed that 20 per cent. of households, or approximately 20 million people, are living in poverty, and that includes one third of the country's children. They also showed that 10 million people in Britain live in inadequate housing, which means, for example, that their homes are unheated or damp or that older children have to share bedrooms. Seven million people go without essential clothing such as warm waterproof coats or solid shoes because of lack of money, and 5 million are not properly fed by today's standards. We should be taking those standards into account, something that many Conservative Members have not done.
The Rowntree report argued that, left to themselves, market mechanisms will not deliver levels of education, training and investment in human capital that are optimal for the economy and society as a whole. Similarly, the Department of the Environment's reports stated on the basis of past trends that any economic recovery in the 1990s will have very limited impact on the numbers experiencing poverty and deprivation.
Although Government policies have made things bad in the country as a whole, the situation is far, far worse in Tower Hamlets where my constituency is located. There, 38 per cent. of households are forced to live on the 839 breadline, and 46 per cent. of children—almost half—live in households without any earners and which are dependent for survival on benefits and the help of their families. They have little future to look forward to.
In the east end of London, for every 100 16 and 17-year-olds with a job, 74 are unemployed and 25 are on a Government scheme. Some of those youngsters have been on a number of training schemes, with no job at the end of the line. Half the young population is unlikely to get work in the foreseeable future, and the situation is no better for many of their parents. Thirty-five per cent. of men between 55 and retirement age in the east end have been thrown on the scrap heap and are unemployed and have little prospect of ever working again. The household of the poor child is often also the household of the unemployed older sibling and the redundant father, and there is no role model of anyone in gainful employment. It is no wonder that people become deeply depressed.
However, in the sea of poverty and despair in Tower Hamlets live and work some of the wealthiest people in our society, in what was planned to be "Manhattan on the Water" on the Isle of Dogs. Billions of pounds of public money were poured into it. The Government's policy of voodoo economics has caused some of the greatest social polarisation and poverty that this country has ever had the misfortune to witness, and nowhere is it more glaring than in my constituency on the Isle of Dogs.
Recent research points to the fact that countries such as Japan, where inequalities are fewer than in Britain, have less ill-health among the lower-paid and a longer expectation of life. The hon. Member for Teignbridge (Mr. Nicholls) was incorrect when he tried to point out that absolute poverty was the important factor. Because people in some countries live happily on a handful of olives, bread, oil and some rice and nuts, we cannot expect the same in a European country. Conditions are very different.
Conservative Members should take into account the fact that it is not only the shortage of money but relative poverty and inequality that create the stresses which add to breakdown in health. Poverty is relative—that is the important point that the Minister and most Conservative Members have failed to recognise. If that were not so, how would the hon. Member for Teignbridge and other Conservative Members explain the fact that, after decades of rising expectation of life, the trend has now gone into reverse for men in lower-income groups between the ages of 15 and 44? The chances of dying before the age of 65 increased for men in those groups in the 1980s.
Even though the average expectation of life is 79 years for women and 73 for men, among the poorest people, men are more unhealthy and dying younger than those at the opposite end of the income scale. Their life expectancy is 10 years less. Poor people are also 75 per cent. more at risk after surgery than rich people.
That inequality in health begins at birth, or even before. There is now an increase in the number of babies born with a low birth weight in poorer families and there is higher infant mortality and infant illness in deprived groups. The baby of an unskilled manual worker is one and a half times more likely to die in the first year of life than the baby of a professional worker or manager. That is a dreadful statistic.
Asthma is a major problem in my constituency. It is partly due to air pollution, but also due to other social conditions. The number of children with asthma has 840 almost doubled and two thirds of them come from poor families living in cold, damp houses. The poorest children are twice as likely to die from respiratory diseases as children from social class 1.
The Black report showed that material deprivation played a major part in causing ill-health. It is true that poor people have always been less healthy than the rich, for obvious reasons, but since the 1980s the gap has grown wider. That is the disgraceful fact. Stress, unemployment, financial worries, the inability to afford normal social activities—small things such as buying birthday and Christmas presents become very important when one cannot afford them, and repairing broken equipment such as a cooker or fridge is a cause of worry when one has no financial reserves—and the hopelessness of long-term unemployment all bring on depression.
It has been mentioned that the suicide rate has increased by 75 per cent. in Scotland. Young unemployed men are 10 to 15 times more likely to attempt suicide than others and, in some areas, suicide is the third most frequent cause of death in young men after heart disease and cancer. That is not a very good reflection of our society.
When people without hope who are living in poverty and despair are put side by side with those who flaunt their wealth, the former are often seduced into looking for scapegoats and the fascists are only too willing to provide scapegoats, as we saw in Millwall not too long ago. I warn the Government that if the gap between rich and poor continues to increase, the problem will spread to the rest of the country, just as it has spread in Tower Hamlets. All the police and private security guards will not be enough to prevent the breakdown of society.
Despite the philosophy of the previous Prime Minister and this Government—I believe that the previous Prime Minister said that there was no such thing as society—society is about far more than feeding the greed of the men at the top. The overwhelming majority of my constituents and the British public are appalled that £23 million is being given to the heads of electricity companies, while we have children begging in our streets.
As the eminent sociologist Peter Townsend has said:poverty kills, this is not a political opinion, it is not a social comment, it is a scientific fact".
§ 6.9 pm
§ Mr. David Lidington (Aylesbury)
Anyone who has even a passing acquaintance with the areas of inner London represented by the hon. Member for Bow and Poplar (Ms Gordon) will have some sympathy for the passion with which she spoke about the problems there. Although I represent a constituency which is—in average terms—much more prosperous, pockets of it mirror at least some of the problems which she described. Indeed, when I contested another inner-London seat next door to the constituency of the hon. Member for Peckham (Ms Harman) in 1987, I remember being moved and impressed by the scale and the history of the social and economic problems that I saw in north Lambeth.
The disagreement between Conservative and Opposition Members today is not over the importance of finding the right mix of policies with which to tackle the challenges posed to our country by unemployment and poverty. There is—I believe—common ground and common motivation on that front. The difference between 841 us lies in our analysis of which policies would be most effective in ameliorating those severe and deep-rooted problems.
Some Labour Members have expressed some recognition of the fact that the problems which we are debating go deep into the history and social structure of the country. The hon. Member for Barrow and Furness (Mr. Hutton) spoke about the importance of family circumstances, and he touched on racial discrimination. Indeed, several hon. Members, Labour and Conservative, have focused on the way in which poverty and unemployment, especially long-term unemployment, have become concentrated in particular parts of the country, sometimes in very small neighbourhoods in towns and cities. That should warn us that there is no quick fix.
Roughly 35 million people are unemployed in the developed countries which are members of the Organisation for Economic Co-operation and Development. That is certainly the highest level since such records were kept. The incidence of unemployment, especially of long-term unemployment, is higher in Europe than in North America or Australasia. Indeed, the problems of unemployment are more severe and, if anything, tending to worsen, in the nations of continental Europe which pursue the policies advocated by many Labour Members. Conversely, in the United Kingdom, unemployment is falling sharply, and falling well ahead of the trend in most of the rest of the continent.
I shall speak a little about the Rowntree report, which, rightly, has been at the heart of much of the debate so far. I do not dismiss the report's findings out of hand, but it needs to be looked at critically. My doubts were first stimulated when I considered a paragraph and a graph on—I think—page 9, that sought to compare the position in the United Kingdom with that in other industrial countries. I found that a set of international comparisons compared different countries over different periods of years.
The graph ran from 1977 to 1990 for the United Kingdom, it ran from 1983 to 1990 for Germany, and for France it ran from 1984 to 1989. For other countries, the period studied and used for the purposes of comparison varied from as little as four to as many as 18 years. The author may be a reputable academic, but that failure to compare like with like suggests flaws in the methodology of the report.
My doubts were reinforced when I considered the evidence relating specifically to the United Kingdom. I saw a great reliance placed on one particular measure of wealth—the survey of households receiving below average incomes. That survey, with its strengths and weaknesses, shows that only half of the so-called lowest tenth of the population are dependent on income-related benefits.
As my right hon. Friend the Secretary of State pointed out, about half those who reported to the survey that they had an income of zero or less spent more than the average for the nation as a whole. In addition, the Rowntree report does not provide any thorough analysis of the movement in and out of the different deciles which it tabulates.
Perhaps most important of all, there are no costings whatever in the report. Of the menu of policy options, come are attractive, and some I have grave reservations about, but, in every case, what is needed and what the 842 report does not provide is a clear economic analysis of the tax measures needed to finance those policy changes, and an outline of the effect that any such changes in this country's fiscal arrangements would have on the broader economy. Money can be spent only once. When it is taken out of the pockets of the workers to pay for what the Government of the day consider desirable projects, it cannot be spent on other forms of consumption or savings.
We need, too, to look at the survey of households in the Rowntree report alongside other measures of wealth and income—notably, some of the measures in the report in the 1995 social trends survey. My right hon. Friend the Secretary of State pointed out earlier that ownership of consumer goods has grown significantly, even among the lowest tenth of the population with regard to income. However, when one looks elsewhere in the social trends survey at records of wage rises during the 1980s, a very different and much less gloomy picture appears than that described by Opposition Members.
Let us consider the records of gross wages for people in work during the past 10 years. Stripping out inflation and considering the figures at 1994 prices, the average weekly wage of a nurse in 1981 would have been £188, yet in 1994 it would be £316. For a cleaner, the average weekly wage would have risen from £110 to £180, and wages for a waitress would have risen from £138 in 1981 to £157 in 1994.
The same survey estimates net incomes after deductions for tax and additions to income by state benefits. Let us not consider the rich—nobody denies that the wealth of the richer members of society has increased over the past decade—but look at the figures for those on the lowest decile point.
A married man with two children who, in 1981, would have earned £137 net, including earnings and benefits, would have received £174 in 1993, including family credit. The net income of a single woman on the lowest decile point, again with two children, would have risen over the same period from £70 to £172. From those figures, we see the need to treat the despairing noises from the Opposition Benches with extreme caution. We also see evidence that tends to endorse the Government's policy of trying to concentrate money available to be spent on social security towards those people in the greatest need.
§ Ms Corston
As the hon. Gentleman is talking about incomes in the lowest decile, is he aware that figures released by the Department of Social Security reveal that a single adult in the poorest one tenth of the population, at April 1994 prices and in comparison to 1979, is £364 a year worse off, while a single adult in the richest one tenth of the population is £5,616 better off? That is the scale of the change, and that is what the debate is all about.
§ Mr. Lidington
The hon. Lady is wrong to assume that an increase in the earnings of the better-off is necessarily a bad thing. It is clear that the evidence I have seen—the hon. Lady did not say which figures she was quoting—from the small print of the Rowntree report and from the broader surveys reported in "Social Trends" shows that the growth in net incomes has taken place across almost every group in society, regardless of whether they started on a low or a high income.
843 I acknowledge the fact that we confront real problems in deciding how to spread opportunity among people who have relatively little opportunity at the moment, and, above all, how to get people back into work.
It can be inferred from the Rowntree report that the composition of the lowest decile of the population has changed over the past decade. There are far fewer pensioners in that group. The Rowntree report suggests that the regrettable rise in unemployment in recent years has been responsible for much of the pattern in incomes that it reported.
§ Mr. Clappison
Has not my hon. Friend touched on a very important point, namely, the improved position of pensioners since 1979? As more and more pensioners have the benefit of occupational pensions and savings which are protected from inflation, does not that mean that, in future, it is likely that pensioners will comprise an ever smaller proportion of the bottom one tenth of the population?
§ Mr. Lidington
I am grateful to my hon. Friend, as he has put his finger on an extremely significant point. As new pensioners bring with them into retirement the benefit of savings and personal occupational pensions policies to which they have contributed during their working lives, the proportion of pensioners in the lowest income groups will continue to fall.
Having acknowledged the problems, I want to suggest measures which the Government should or should not take to tackle the problems. I want first to consider what the Government should not do. It is vital that they do not abandon a macro-economic policy which gives priority to the need to contain and to reduce inflation.
As my hon. Friend the Member for Hertsmere (Mr. Clappison) said, more pensioners these days can take advantage of income other than the state retirement pension. However, as the Rowntree report states, and as we are all aware from our constituency surgeries, there are still pensioners who are not well off. Often they are pensioners whose income is slightly above the threshold at which they become eligible for various state benefits.
However, those pensioners are very often people who were thrifty during their working lives in the 1960s and early 1970s, and who saved only to find that their life savings were eroded, and almost completely dissolved, by the high rates of inflation of the late 1970s through to the beginning of the 1980s.
It was not the free market that betrayed those people; it was successive Governments who debased the currency for political motives at the expense of those people's savings. Whatever our political allegiance in this House, that experience should mark all of us. There should be a common determination to ensure that such a disastrous state of affairs does not occur again.
Nor do I believe that the Government should succumb to the dangers and temptation of protectionism. There was an episode in the speech by my hon. Friend the Member for Twickenham (Mr. Jessel) in respect of which I feared that he was urging a protectionist course on the House, in—in my view—the mistaken judgment that that would help to protect jobs here.
The growing prosperity of countries, like India, which we have previously described as part of the undeveloped or third world, is something that we should welcome. We should welcome it because it means that millions of 844 people in those countries can now seek to aspire to the material standards of living that people in this country and in the rest of the developed world have taken for granted for many years.
In addition, growing prosperity in those countries provides market opportunities for British businesses to go out and sell their goods and services to the consumers in those countries. I want the Government not to shut the doors against world trade, but to encourage our businesses to take full advantage of the opportunities as they present themselves.
With regard to what the Government should not do, I warn them against any thought that redistribution is somehow the answer to the problems facing this country.
§ Mr. Lidington
I will explain why. Opposition Members should also ask the hon. Member for Glasgow, Garscadden (Mr. Dewar) why, because he took great care to tiptoe around specific commitments to redistributive measures. However, implicit in his critique of the Government, and implicit in the critique of every Opposition Member who has spoken so far, was the idea that somehow our problems could be solved by taking money away from the rich and giving it to the poor.
The hon. Member for Garscadden seems to see himself as a Presbyterian Robin Hood preparing to distribute goodies from the undeserving to the deserving. However, the truth is that there is no phalanx of plutocrats waiting to be milked in order to distribute extra resources to the poor. If serious redistributive policies are followed, that will mean very much higher rates of taxation for middle-income workers and their families.
An interesting analysis in the Organisation for Economic Co-operation and Development study on employment suggests that, for the United Kingdom to provide every family with a basic income of 30 per cent. average earnings, it would take a standard income tax rate of about 37 per cent., together with the abolition of housing benefit, council tax benefit and other income-related benefits.
Frankly, Opposition Members are trying to fool the House and to mislead the British people if they seek to insinuate that a policy of redistribution could begin to tackle the problems which this country confronts without causing the need for very high rates of taxation, with the consequent disincentives to work for the majority of the working population.
What should the Government do? In that regard, I want to refer to several areas of policy.
§ Mr. Jimmy Wray (Glasgow, Provan)
Is it fair that every senior citizen and every gas, electricity and telephone bill payer must pay standing charges? Is it fair that 78 per cent. of Glasgow council tenants receive housing benefit? Is it fair that the Government's policy is to transfer housing stock to Scottish Homes and other housing authorities, thereby leaving local authorities with massive debt? Local authorities have been borrowing for more than 60 years to house a small number of tenants. That situation has been created—
§ Mr. Lidington
I am sure that the hon. Member for Glasgow, Provan (Mr. Wray) will try to catch your eye 845 later, Mr. Deputy Speaker. To take the first of his points only, not every pensioner lives in poverty. Help for pensioners should be concentrated, through the social security system, on those who are in need, rather than there being a blanket subsidy which benefits dowager duchesses as much as people who need help.
When I urge a course of policy upon the Government, their decisions will be influenced by what can be afforded in a certain year and by the competing demands of the various good causes which present themselves to the Treasury every autumn. However, the key seems to be action to reduce unemployment. More could be done to relieve the burdens on business, which still provide disincentives to recruit extra people.
Only this weekend, I talked to small business men in my constituency. They said that they would like to hire extra workers but that the combination of payroll taxes, form-filling and the regulations that apply to adding to a payroll act as a very significant disincentive. I hope that, as scope becomes available to the Government to reduce taxation again, they will look at ways in which to lift further the tax burden on businesses and encourage them to recruit more people. Deregulation, especially through the new powers in the Deregulation and Contracting Out Act 1994, can play a part.
The Rowntree report and numerous commentators have pointed to the importance of education. It is true that people who have a poor education and few skills are most likely to join the ranks of the unemployed, particularly the long-term unemployed, or to end up in low-paid, insecure jobs.
The answer is certainly not a matter of money: it is a matter of ensuring that choice, rigorous inspection and testing act together to drive up education standards, so that all children, before they reach the labour market, are equipped for the working world in which they will have to live and in which they will have to be prepared to be adaptable throughout their working lives. Much more could be done—for example through Ofsted—to disseminate best practice among schools.
In the end, it will be partly a matter of money. I hope that, when the pressures on Government borrowing have been successfully reduced by the tough but correct decisions of the previous two Budgets, the Government will place education firmly at the head of their priorities.
My personal view is that primary education is a higher priority than nursery schools, colleges or universities. It is in the five-to-11 or 12 age group that the crucial learning period takes place. To a great extent, it determines whether a child will succeed in his career.
The hon. Member for Bow and Poplar and I sat on the Education Select Committee inquiry into the disparity of funding between primary and secondary schools. We found that, since the second world war, under Governments and local authorities of both political colours, primary schools had been funded at a much lower level than secondary schools, for no scientific reason but simply because that had always happened. There is a cause that the Government could take up.
The Government must look carefully at their family policy. Again, the Rowntree report mentioned family policy as one cause of the problems of poverty and 846 unemployment. We must look rather deeper than hints about a tax allowance for nannies, such as we have heard from the Opposition.
I am fully aware that one must be conscious of sensitivities in discussing such matters. All hon. Members handling casework on the Child Support Agency have been made fully aware of that. We must be aware also that family policy matters touch on personal morality. Although all Members of this House are honourable, very few of us are candidates for sainthood. We should speak cautiously as a consequence.
We should bear it in mind also that we cannot legislate to provide for human affection, one to another. Having made those qualifications, I believe that Archbishop Habgood was right: the Government should seek, when it becomes possible, to provide an incentive for people to marry and to stay married, perhaps concentrating on families on lower income levels. It has been recognised by the Leader of the Opposition that it is within stable families with two parents present that children have the best chance of an upbringing which will allow them to develop their full potential.
In the past 10 years, the Government have taken many initiatives to tackle the problems spelt out in the Rowntree report and in this debate. I am confident that, not by sermons or indignant speakers, but by the application of practical intelligence in working out a policy day by day, year by year, the Government will continue to succeed in that common endeavour.
§ Mr. Denis MacShane (Rotherham)
I hope that I shall not make an indignant speech, but I am certainly very angry about the quality of our debate so far. We have heard some remarkable interventions by Conservative Members. The hon. Member for Twickenham (Mr. Jessel) wanted the poor to improve their diet. The hon. Member for Aylesbury (Mr. Lidington), if I understood him correctly, suggested that the poor should be made to stay married. Presumably, the rich could gallivant and have what and whom they want. Before that, we heard the speech of the Secretary of State for Social Security. It was a weird mixture of old clichés, such as lamp posts more for support than for illumination, and wonderful metaphors about lights from black holes, which suggests that the right hon. Gentleman knows as much about astrophysics as he does about social security.
The Rowntree report is the bubble that has come to the surface. It has finally exploded and revealed seething uncertainty, fear and anxiety about the growth of poverty in our society. I cannot believe that hon. Members can fail to acknowledge that fact.
This is an important, historical turning point. In 1979, the Conservative party, after a century of it being constructed by many different parties, inherited one nation, with all its frayed edges. When the Conservatives leave office—the sooner the better—they will bequeath two nations as their historical legacy. Those nations will be divided not just geographically. We have the problem of what might be called the M25 Administration—a Cabinet most of whose members represent constituencies 847 within commuting distance of London. Not one member of the Cabinet represents England's biggest county, Yorkshire.
§ Mr. Alan Howarth
The hon. Gentleman suggested that in 1979 the Conservative party inherited one nation. Would he describe Britain in the winter of discontent as one nation?
§ Mr. MacShane
I said that the Conservative party inherited a tradition of one nation, although the tradition was frayed at the edges. I take the hon. Gentleman's point about developments in the 1970s; Opposition Members need not be proud of all of them. But the challenge is to rebuild one nation, not to drive the two sides further apart and create the two-nation Britain in which we live—two nations not simply geographically or politically, but two nations even within so many of our constituencies. There are also two nations as between the genders, and between the cultures of community and of greed.
The Conservative party came to office when family life still counted for something, but it has presided over the single biggest assault on family life. In a sense, the family has been seen as the metaphor for the nation this century. The statistics have already been mentioned—such as the number of divorces and single-parent families, and the growth in the number of illegitimate children.
I believe strongly that the message from Archbishop Habgood is both good and timely: there are fiscal and social policies, many of them cost-neutral, which could be implemented to strengthen family life. As the Secretary of State said in his lecture in Northern Ireland, one of the most important problems today is the absence of the single wage earner—male or female, because modern family life is about partnership—able to provide an income on which a family can grow up in tranquillity and decency.
We need many more jobs for full-time male workers. I know that I shall be criticised by leading members of my own party, but I must court unpopularity by saying that the inability of the male breadwinner to earn a salary sufficient for a family to grow up on is a labour market problem that we have not dealt with. On the contrary, we have made earning such a salary all but impossible for so many of the half of the population who are not women.
The debate is split between social security and employment matters, yet the Chamber is not graced with the presence of the Secretary of State for Employment. No doubt he is off in some rich Swiss ski resort pontificating on various aspects of policy. What a pleasure it must have been. There he was in Davos—a place that ordinary Members of Parliament visit only to be sportsmen and to ski—telling us about our country's policy on the intergovernmental conference. He was Mr. Foreign Secretary there. Then he was Mr. Chancellor of the Exchequer and came back and told us what our policy on the single currency should be. I find it deplorable that he is not prepared to come down from planet Portillo, give up being the pontificator maximus of the Cabinet and defend in the House his labour market policy, which is the shame of the modern world.
The modern labour market is rather like an ecosystem; it is something that we must preserve, cherish, support and perhaps change. As has happened over the past 16 years, it can be put grossly out of kilter by elementary 848 blunders. Labour market policy is at the heart of the debate, of Britain's future and of both social cohesion and economic growth.
Not many hon. Members have so far mentioned the example of the dynamic Asian economies, although I pay tribute to the hon. Member for Twickenham, who brought them into the debate. Those economies set out to achieve economic efficiency and found that they had created a more equal society. That is the paradox of the dynamic Asian economies—wage differentials, social and education policies, the total state ownership of all land, as in Hong Kong, leading to progressive housing policies, go hand in hand with—
§ Mr. Lilley
Will the hon. Gentleman spell out more clearly whether he is advocating that we adopt the tax and benefit policies of, for example, Hong Kong, Taiwan or Korea?
§ Mr. MacShane
If the Secretary of State stays and hears all my speech, he will realise that I have strong views about the pay policies in those societies. I am nervous of suggesting that the Government should take on the ownership of all land in this country and simply lease it, but doing that has certainly made one of the most important contributions to the development of a stable economy in Hong Kong. The great development of social housing in Kowloon has allowed the workers of Hong Kong to feel that they have not simply been left at the margin of economic development.
As I said, labour market policy is at the heart of the discussion, so I find it deplorable that the Secretary of State for Employment is boycotting the debate; I did riot realise that secondary picketing now extended to the Cabinet. We need a policy for pay—although admittedly the Conservatives have had a policy for pay since 1979; Mrs. Thatcher was undoubtedly the greatest free collective bargainer of all time. As a detached political scientist rather than a Labour Member of Parliament, I pay tribute to her.
Conservative Members have said, and have been right to say, that—apart from a tiny blip at the beginning of the 1990s, when we were in the exchange rate mechanism and the recession was biting—pay increases for the people who remain in full-time employment in the private sector have constantly outstripped inflation. However, that has had consequences. There has been a massive redistribution, not just from the bottom decile, full of all those accountants and taxi drivers who declare zero earnings and are thus included, but from all the weaker sections—the bottom 20 or 30 per cent. of society.
The economic consequences of that were that in the 1980s, because the pay policy allowed the private sector significantly to outstrip inflation, our unit labour costs—the key to successful exporting—outstripped those of all our main competitors; hence the growing trade gap and the collapse of so much of our export-led manufacturing industry. The pay gap has widened so grotesquely that even the Prime Minister has had to express concern about the pay awards to the chairmen of the privatised utilities.
The pay rise for Cedric Brown, who started life as a gas fitter in Rotherham and has never changed the company for which he works, means that he now earns nearly 100 times what one of his employees might earn. That ratio is far higher than those in our successful and dynamic competitor or partner economies—certainly far higher than that in any of the successful Asian economies.
849 In a Japanese company, it would be most unusual for the chief executive officer to earn more than 10 times the average pay of his employees.
Compare that with the chairman of Marks and Spencer, who has been set up to head the Confederation of British Industry, Institute of Directors, "turkeys will vote for Christmas" committee to examine how executive pay could be curbed. He is earning about 100 times what one of his employees would earn. That grotesque pay gap has finally woken public opinion to what has been happening in the past 15 years.
§ Mr. Michael Shersby (Uxbridge)
Why is the hon. Gentleman concentrating on a comparatively small number of high-profile individuals in the private sector who make major contributions to the industries in which they serve? Has he anything to say, for example, about the huge salaries that are paid to certain sportsmen, media personalities and newscasters? We hear not a word of criticism about those people from Opposition Members.
§ Mr. MacShane
I did not know that we were debating the salary of the right hon. and learned Member for Putney (Mr. Mellor), but we can come back to that.
I take the hon. Gentleman's point. All leadership is, in my judgment, about leadership by example. When a field marshal is earning 10 times more than a private, that is right. When the Prime Minister earns what he does, that is right also. But when people are earning 100, 120 or 200 times more than their employees—as has happened following the awards in the past three or four years in our banks and big companies—that is wrong, and it is rotting the sense of social cohesion, work loyalty and managerial efficiency that we need.
§ Mr. Peter Bottomley (Eltham)
I realise that there will be more important parts of the hon. Gentleman's speech and of the debate, but will he mention by name who it was who, by salary and share options, contributed £80,000 to the successful campaign of the present leader of the Labour party? Have any of those people, their salaries and share options, ever been mentioned by any Labour spokesman?
§ Mr. MacShane
I may be open to correction, but I believe that Anita Roddick—who earns about £138,000—chipped in some money. She earns 10 to 12 times the average earnings of the people working in the Body Shop.
In the autumn, I presented a ten-minute Bill about the introduction of a maximum wage, and I suggested a ratio of 20 to one. To my horror, somebody wrote to The Daily Telegraph—he or she had not read my speech—to say that we needed a maximum wage ratio of 12 to one. For me to be outflanked on the left in the letters column of The Daily Telegraph symbolises how concerned the British people are about the issue.
The issue is not just pure poverty—it is not just the big issue of the people selling The Big Issue. Poverty in work is finally being taken seriously. Working hard used to be a way, if not to riches, at least to a decent standard of living. It is no longer. I pay tribute to the Under-Secretary for the honest replies that he sent me, which show that one in six blue-collar workers earn £150 a week or less. Some 2.5 million part-time workers earn less than £4 an hour. One in four women in manual jobs have gross pay of under £132 a week.
850 The majority of those people have to be subsidised by the Department of Social Security, and I would have thought that that was an extraordinary denial of Conservative economic policy. Massive Government handouts are subsidising firms to allow them to employ people on low wages.
The answer to that is, of course, the minimum wage. I am doubly grateful to the Under-Secretary, because he has sent me detailed figures. The Secretary of State for Social Security held up a visual aid earlier, but I shall not hold up mine. The figures show that in countries with a form of statutory minimum wage—including America, with a rate of £3, and France, Australia and Japan—the rate of employment growth between 1980 and 1990 was significantly higher than in the UK.
Between 1990 and 1993—here, the economic conditions were very different—the rate of employment growth was again higher in most of those countries.
§ The Parliamentary Under-Secretary of State for Employment (Mr. Phillip Oppenheim)
It would help if the hon. Gentleman quoted the correct figures. He has previously stated that employment growth in the UK over an economic cycle period was just over 1 per cent., but the correct figure is nearly 7 per cent. The hon. Gentleman should look over the economic cycle from 1979 to 1990, when Britain had a faster rate of employment growth than minimum wage countries such as France, Belgium and the Netherlands, which had a high minimum wage, as opposed to the United States and Japan, which had minimum wages so low that almost no one was paid at that level.
§ Mr. MacShane
I am grateful that, at long last, we have had that exchange. The Under-Secretary wrote two letters to The Guardian to put me right on the matter. I wrote one letter, and then a second one, which I faxed on paper with a House of Commons letterhead. The Guardian did not publish it. I can say now across the Floor that the Under-Secretary is fundamentally wrong. I do not have the time to read out all the figures, as other hon. Members want to speak.
The United States has a statutory minimum wage of £3 an hour, but President Clinton wants to extend it. It is in fact going up, because our currency is going down as I speak.
§ Mr. Oppenheim
The minimum wage in the United States is £2.60, and it was hardly raised at all in the 1980s. When President Clinton came to power, he committed himself to raising it. Unfortunately, two years later he has still not done so because his Secretary of Labour, Robert Reich, said that it would threaten the recovery. Mr. Clinton waited until there was a Republican Congress and Senate before announcing that he would raise the minimum wage by all of 25 cents. I suspect that he knows in his heart of hearts that the Congress and Senate will throw it out. Why did not he raise it in the past two years when there was a Democrat Senate and Congress? I suspect that it was because even Democrats realise that the minimum wage destroys jobs.
§ Mr. MacShane
The Under-Secretary is now reading his letters to The Guardian at the Dispatch Box, but I shall not read mine back to him. In the United States, 851 where the minimum wage is set—at current exchange rates—at just under £3 an hour, the rate of employment growth from 1980 to 1990 was 18.4 per cent.
§ Mr. Wray
Does my hon. Friend agree that we would need a minimum wage of £6 or £7 an hour to deal with the misery that has been created by the Government? People have been left in debt with their mortgages, as they have had to pay 16 per cent. instead of the 8 per cent. rate when they first bought their houses. Has not that been caused by the Government?
§ Mr. MacShane
Even a minimum wage set at the United States rate of some £3 an hour would be an extraordinary step forward for social justice in my constituency of Rotherham.
§ Mr. MacShane
I am delighted to have an intervention from the most legendary Conservative Member, who must soon be in the Cabinet. The minimum wage will have to be set at a fair level that is not destructive to employment. It must be decided at a time when, in government, we see what the economic data are. It would be preposterous to set any particular figure now.
Working time is also causing much difficulty in our labour market. The figures that the Secretary of State for Social Security quoted did not show the amount of working time that workers have to put in for their wages. All the evidence suggests that working time has increased significantly, and it is another growing inequality in our society.
The Minister of State, Department of Trade and Industry boasted in a debate before Christmas about a factory that he had visited in Essex—it would be Essex—where men worked 65 hours a week. That is 120 years after Disraeli legislated for the 56-hour week in the 1870s. The 65-hour working week will make family life impossible and cause immense trouble with cohesion.
The amendment to the Opposition motion welcomesthe high priority accorded by the Government to education and training".I wish that the right hon. Member for Brent, North (Sir R. Boyson) were in his place. Yesterday I asked him, "Rhodes, what can we do to improve the quality of education in this country?" He answered that it was an impossible task, that we are 18 months behind all our main competitors in mathematics, that we have lost all sense of standards and that there is no cohesion in Government education policy. In some colleges of higher education, the A-level pass rates have fallen to about 25 per cent. They have to keep up their rolls and do so by keeping on students. Training budgets have been cut by one third.
The Government claim in their amendment thatemployment is the best route to higher incomes".As I showed when I cited the figures for fair pay, labour market policy must be based on partnership and on planning—as is the best company policy. It must be a labour market policy with some moral purpose. On the latter, it is deplorable that the Prime Minister appears to be snubbing the world social conference in Copenhagen next month, while every other world leader is acknowledging that employment and the labour market are issues that we must take far more seriously.
852 Planning, purpose and partnership are three concepts that are utterly inimical to the Conservative party. The worst poverty—the poverty that makes me angry—is the poverty of our nation's ambitions. When I was born, three years after the war, we ranked fifth or sixth in the world for gross domestic product per capita. In the mid-1960s, when I left school, we were in the top 10. Italy had half our GDP per capita and Korea had an average per capita income of $250 per year. In some areas, Korea and Italy have overtaken us. We are now sinking into the second or third division of nations.
I am in the House because I have the ambition to put that right. We want a society in which ambition is encouraged and communities are ambitious. We want Britain to rise again, for all its people and, unlike the Conservative party, we want it to rise with all its people. That is Labour's ambition and its programme for the 21st century, and I hope that under Labour we shall once again live in one nation.
§ Mr. Deputy Speaker
Order. I remind the House that Madam Speaker placed a 10-minute limit on speeches between 7 pm and 9 pm.
§ 7.3 pm
§ Mr. James Clappison (Hertsmere)
I welcome the opportunity to make a brief contribution. This debate calls for realism and I hope that I am being realistic in reflecting that life is not easy for people on benefits. Many of my constituents suffer similar, complex social problems to those to which other hon. Members referred.
The debate also calls for realism from the Opposition—realism about how they will deliver the high expectations that they set out in their motion. One of the telling points in this debate was when my hon. Friend the Member for City of Chester (Mr. Brandreth) asked the hon. Member for Glasgow, Garscadden (Mr. Dewar) how he would flesh out his proposals. There was no answer. The hen. Gentleman was short on delivery throughout his speech.
The debate also calls on Opposition Members to be realistic about something else. They talk of gaps, the redistribution of wealth, relative this and relative that. They must face the fact that there is irrefutable evidence that there has been a massive and widespread increase in prosperity and incomes during the past 15 years.
We have heard much about evidence from "Social Trends", which is plainly evidence of people and ordinary families having access to items that were considered luxuries not long ago. I welcome the fact that people in the lowest decile of the population by income apparently have increasing access to such important items. It is a good thing.
The evidence goes beyond that. My right hon. Friend the Secretary of State mentioned the increase of 39 per cent. in the average incomes of non-pensioner households, which is reflected by a similar increase of 36 per cent. in median incomes for households, according to Department of Social Security figures.
I accept the caution that my hon. Friend the Member for Aylesbury (Mr. Lidington) offered about the Rowntree report and the way in which it was compiled. Even that report, on which the Opposition rely for so much else, shows that there was a substantial increase of 26 per cent in median incomes between 1979 and 1981. I invite 853 Opposition Members, including the hon. Member for Birkenhead (Mr. Field), who is looking at the report, to exercise some caution. The hon. Gentleman may find that his fingers get burned.
The report surveys the period between 1961 and 1991 and estimates that, after taking housing costs into consideration, median incomes increased by a miserable 2 per cent. between 1974 and 1979. Opposition Members had better be careful when they refer to that report. They might provide evidence that people would be much worse off if the party which was in power from 1974 to 1979 had continued after that time with the policies that were impoverishing the nation by 1979.
Health has also improved. During the debate we have heard many misconceptions about the health of the nation—misconceptions based, to some extent, on the "Panorama" programme last night. It is important to make it clear that, in absolute terms, health and life expectancy have improved considerably. The figures for changes in relative positions on which the programme rested its case were for young men in certain small areas of the country. Throughout the country as a whole during the past 15 years, there has been a substantial increase in life expectancy—two years and six months for men and two years and one month for women. The hon. Member for Barrow and Furness (Mr. Hutton) gave figures for the northern region and for regional differences, but those were differences from the national average. There has still been an absolute improvement within that region. The hon. Gentleman is not in his place, but, if he looks again at the figures for 1978, he will find that the regional difference was much the same then as it was in 1994. There has been an absolute increase in life expectancy.
Infant mortality is another indicator; there have been great improvements during the past 15 years. The hon. Member for Bow and Poplar (Ms Gordon) spoke movingly and said how she cared about that subject. If she consults the latest figures from the Office of Population Censuses and Surveys, she will find that there has been an enormous reduction in infant mortality during the past 15 years. In fact, the reductions have been greatest in the lowest social class—a reduction of 56 per cent. in infant mortality for social class V. I welcome that achievement.
Although there obviously has been a widespread increase in prosperity, we need to tackle the issues that arise in respect of the bottom 10 per cent. of the population. I take note of the words of caution that were expressed about the way in which that figure has been analysed, and I agree strongly with my right hon. Friend the Secretary of State that it is important to consider the composition of the bottom 10 per cent. and to concentrate on ways of helping specific groups in it. Obviously, in the past 15 years, the number of unemployed people in that bottom 10 per cent. has increased; therefore, it is most important to concentrate help on those unemployed people, providing them with ways out of unemployment and back into high levels of income and prosperity.
I welcome the measures that my right hon. Friends have put in place to help the long-term unemployed specifically, and I do not pour cold water on proposals such as work trial and workstart, which are good ideas, which need to be considered carefully and implemented with great thought. I also do not pour as much cold water 854 as the hon. Member for Garscadden did on the increase in family premiums for unemployed people who want to enter full-time work. That is a valuable measure.
Beyond that, I have no doubt that the most important way of helping those unemployed people and helping people in the bottom 10 per cent. is to continue our policies, which are designed to bring about sustainable economic growth. We have not mentioned that sufficiently in the debate, but it is important that we continue sound economic management, which will provide the growth to return those unemployed people to work. That is our answer to the questions that were asked by Opposition Members about that bottom 10 per cent.
I turn now to what Opposition Members have said. What are their policies, we may ask, for helping the less well-off—those in greatest need? My hon. Friend the Member for Stratford-on-Avon (Mr. Howarth), in a thoughtful intervention, asked the hon. Member for Garscadden about that, and especially how he was going to pay for his aspirations. The hon. Gentleman, in an illuminating reply, began to speak about levels of executive pay.
We have returned to that theme repeatedly in the debate. The idea is held on the Opposition Benches that there is a pot of gold of executive pay and high earners, which can be raided to fulfil all the Labour party's social aspirations. My hon. Friend the Member for Aylesbury' disposed of that idea effectively in his careful analysis, but, if the Opposition will not take his word for it, will they take the word of a recent Chancellor, who wrote about the subject in his autobiography? He said:There will always be controversy about taxation, and, since it directly affects the interests of every individual, the argument is unlikely to be very objective. My own experience as Chancellor led me to certain general conclusions".He said that one of those was thatany substantial attempt to improve the lot of the poorest section of the population must now be at the expense of the average man and woman, since the very rich do not collectively earn enough to make much difference, and the average man does not nowadays want to punish those who earn little more than he, since he hopes ultimately to join them.That is the answer to the arguments of the redistributionists. [Interruption.] The Opposition Members who are heckling may want to know that that Chancellor of the Exchequer was no other than the former Member for Leeds, East, Lord Healey. He knew a thing or two about taxation. Perhaps new Labour needs to learn a few lessons from old Healey, although all Conservative Members remember the painful price that we paid for those lessons in taxation.
The right hon. Member for Sedgefield (Mr. Blair) has expressed his ideas for helping the less well-off and for creating employment. In a recent interview for She magazine, which is described as "the magazine for women who juggle their lives," he said, in response to a pressing interviewer, that tax relief on nannies was one of the things that the Labour party was considering, although he said that he was cautious about that. I think that he is right to be cautious, because, although there may be some interest in that subject in some parts of Islington and certain other quarters, I do not think that it will have the hon. Member for Bolsover (Mr. Skinner) going into the Lobby dancing with glee. I think that he is right—
§ Mr. Dafydd Wigley (Caernarfon)
I am grateful for the opportunity to speak, and I welcome the way in which the issues of poverty and long-term unemployment have been brought together, because there is no doubt that the two are linked. Coming as I do from Wales, I know that we have had a history for many years of difficult areas that suffer from unemployment and its accompanying problems.
Those problems appeared to be improving for a time, but now we seem to be slipping back rapidly. The problems, which were witnessed decades ago, of real, biting poverty, hitting not only individuals but communities, are returning, especially in the old industrial areas. That is happening in my constituency, the slate quarry constituency, and especially in some of the old coal mining areas—the valleys of Glamorgan and Gwent and the old steel towns down there. People there have become out of work; there is no alternative work; the work that may be available is often poorly paid, part-time work; and the standard of living is deteriorating rapidly. That hits the quality of the physical environment in those areas and has an impact on people's health and well-being.
That surely must be, in part at least, a moral question, not simply an economic one. We have unemployment in Wales of slightly less than 10 per cent. I believe that it is absolutely wrong that the whole burden of the depression should fall on to the shoulders of the last 10 per cent. in the job scale. I further believe that it would be possible to bring those people into work if a concerted effort were made to do so. I accept that that may well mean higher taxation, and it may well mean higher taxation on average earnings, and not only at the very top. I believe that that bullet must be bitten, for social as well as economic reasons.
In Wales, we have watched our gross domestic product per capita drift back in comparison to the figures for the United Kingdom as a whole. In 1977, our GDP per capita was 87 per cent. of that of the UK; it had decreased to 83 per cent. by 1992. Wales has the lowest GDP per capita of any part of the UK, and the counties of Gwynedd, Dyfed and Mid Glamorgan have a smaller GDP per capita than the Irish Republic. The Irish Republic has a greater GDP per worker than Wales as a whole, and soon it will have a greater GDP than Wales as a whole. The Irish Republic is succeeding, while policies in Wales obviously are not succeeding.
Among the factors that bring about the small amount of income per head are unemployment, to which I referred a moment ago, and high inactivity rates, which are highlighted not only in the Rowntree report but in "The Geography of Poverty and Wealth" by Anne Green, published in July 1994. That report shows that many of the areas with the greatest inactivity rate are in Wales. About 300 areas throughout the UK were rated on their degree of inactivity. Ten of the 12 worst are in Wales. They are Rhondda, Afan, Cynon, Merthyr Tydfil, Blaenau Gwent, Rhymney valley, Llanelli, Neath, Dinefwr and Islwyn. Eight of the worst 10 areas for women's inactivity are in Wales. They are Rhondda, Merthyr, Afan, south Pembrokeshire, Blaenau Gwent, Rhymney valley, Cynon and Ynys Mon. We are at the worst end of the queue on a whole row of indicators concerned with inactivity.
856 Other dimensions contribute to the poverty that is rampant in many of those old industrial areas—illness and disability. In the constituencies in the Mid Glamorgan area—Merthyr, the Rhymney valley, the Caerphilly constituency, Cynon, Rhondda and Pontypridd—there are about 17,000 unemployed people and 34,000 people on invalidity benefit. That is largely the result of the effects of old industry. Those factors, together with low activity rates—which some people have in common—lead to the very low incomes on which families must live.
In addition, there are demographic factors. There are older families, sometimes as a result of young people having left the area to seek work. There is a preponderance of older people who depend on state pensions. In Wales last summer, the unemployment rate for 16 and 17-year-olds was 28 per cent. Of those, 89 per cent. had no income whatever. All those factors contribute to the problems that we face.
It is no use saying that, provided that we give those at the top enough money, there will be a trickle-down factor. In Wales, we simply get a trickle-out factor.
§ Mr. Wigley
I am sorry, but I cannot give way because we are under a time limit.
Money that goes to those at the top of commerce or industry goes outside Wales and does not trickle down into the Welsh economy. Incidentally, the trickle-down factor does not even work to a great extent within the United Kingdom economy because those with the highest earnings often spend them overseas on items such as holidays and they do not necessarily work through the economy.
It is all very well criticising and explaining the problem, but what can we do about it? We must create jobs to do the work that needs to be done in our communities. There is scope for some 100,000 jobs in Wales. Goodness only knows, the environment needs tidying up and protecting for the future. We need community nurses and even bath nurses and home helps to assist people who, 10 years ago, may have been in institutional care and have difficulty in surviving at home. Work is also needed in terms of pollution control, water quality programmes, education and training, and police and security.
Although jobs exist in those areas, they do not command an expenditure capacity that will immediately create extra jobs. We therefore need public sector intervention not only to create jobs in the categories that I mentioned but to stimulate projects such as the cabling of Wales for the Internet development, which will be important in future years.
Given that unemployment costs on average £9,000 a year when expenditure and taxation are deducted, by spending an additional £4,000 a year to bring unemployed people back into work to undertake the much needed social, environmental and infrastructure work in all our communities, we could solve some of the economic arid social problems that face us. I admit that that would cost some £400 million a year in Wales and a rolling programme might cost a similar amount in capital terms. That would mean a couple of pence in the pound on income tax, a slightly greater borrowing requirement, and some extra money from the private sector.
857 That is a challenge to not only the Government but the Labour party. If we are to deliver the programmes that are needed in terms of training, facilities, social work and the environment, we must pay for it. There is no soft option; we must bite the bullet. If it costs a couple of pence extra on income tax—not just for the very rich but for average wage earners—to bring people into work and carry out the work that is needed in our communities, the Labour party as well as the Government must face that fact. Morally, we should be prepared to pay that, because it is wrong to have 100,000 people on the dole in Wales, becoming long-term unemployed because there is no short-term work available.
That is a challenge to this and any other Government and I hope that both sides of the House will bite the bullet.
§ Mr. Alan Duncan (Rutland and Melton)
I apologise for not being present earlier in the debate, but I have been sitting on the Standing Committee that is studying the Disability Discrimination Bill. As soon as it adjourned, I felt the urge to race back to the Chamber, if only to fend off the charges of the hon. Member for Glasgow, Garscadden (Mr. Dewar) that I am somehow a Government stooge in everything that I say on this topic.
The hon. Gentleman would not allow be to rebut that charge and refused to take an intervention from me. I have learned why he was not prepared to take an intervention, interrupting a pattern to debates that we have both enjoyed on many encounters. It is because he, as a man of integrity and a master of his brief, who always enlightens the House with what he has to say on social security, is ashamed of the manner in which his Front Bench has hijacked an issue, distorted it and used it so viciously against the interests of the impoverished, whom he pretends to champion.
Contrary to the motion, everything that the hon. Gentleman said concerned inequality rather than poverty. He tries to parade inequality before the media to suggest that, somehow, those who have earned money are to blame for those who have not. Inequality is unconnected with poverty, but the hon. Gentleman knows that, in the current mood of politics, he can seize on a rich seam of grievance to play that political card.
The Labour party is covering up its lack of a policy to try to alleviate the poverty that should be the proper cause of our concern and focus of our attention. In discussing inequality and poverty, the hon. Gentleman links two unconnected phenomena to try to convey the impression, for his own purposes, that the one is to blame for the other: it is not.
The real issue, which the motion addresses but the hon. Gentleman did not, is poverty and it is separate from the question of what other people earn. The hon. Gentleman has raised the phantom of the issue of inequality before every camera prepared to point in his direction. If one had listened to what he said, one would have heard many an attack on inequality but no solution to the problem of poverty—except, perhaps, one, which was more of the same.
Where the hon. Gentleman and I differ is in trying to study and assess the origins of poverty. One of the main causes of poverty is the very policy that he would like to 858 see more of. That is why, from a sedentary position I said to him, "Socialism." Contrary to what Beveridge envisaged, the workings of the welfare state have gradually impoverished many people, particularly in Scotland.
§ Mr. Graham
I shall be courteous and give way to the hon. Gentleman if he wishes to intervene in my speech. Does he realise that, from 1979 to the present day, Strathclyde alone lost nearly half its manufacturing jobs under his Conservative Government? The Government have done nothing to encourage folk to work by stimulating the economy and providing enough money for companies to keep their business.
§ Mr. Duncan
Stooge though the hon. Member for Garscadden might label me, I assure the hon. Member for Renfrew, West and Inverclyde (Mr. Graham) that it is not my Government. I do not accept his thesis. Socialist Scotland has denied many opportunities to those who wish to be in work.
Let us take the hon. Gentleman's starting point of 1979 and look at the Rowntree report, which based its thinking on that starting point. In a so-called "scientific" exercise, it simply took a household incomes survey and extrapolated it through some extraordinary set of contortions to reach the conclusions that have been broadcast widely over the past couple of days. In 1979, punitive taxation so suppressed, reduced and squashed the earnings of the so-called rich that it was inevitable, to return to a modicum of sanity, that in the years that followed the diversity between the extremes of those who earned a little and those who earned a lot would widen. So what? It is good for prosperity that that should happen.
Furthermore, over those 15 years, the Rowntree report took a moving target for the purposes of making comparisons and drawing conclusions. The definition that it used to say that inequality had increased had itself moved for ever upwards. Therefore, to argue that the poor have got poorer is a falsity. Only because it was a comparative figure for ever moving upwards in the 15 years of the survey was Rowntree able to draw that conclusion.
The Rowntree report revealed a tale of two systems: a system of progress and enrichment based upon capitalist behaviour, which has been shown to work, and an alternative system of welfare, which by comparison has gradually impoverished those who have become increasingly dependent on that system.
Let me once again look the hon. Member for Garscadden in the eye to prove to him that I am not the stooge that he so loves to label me. Let me advance what I believe would be a solution to the way in which those he pretends—and perhaps genuinely wishes—to help have been impoverished, which perhaps is not fully in tune with Government policy.
The Social Security Select Committee has done much work on what should be the future of the welfare system in Britain. We have not considered it in as much detail as I would have liked. One of the problems of the welfare state is that many people have become increasingly trapped by so many conflicting influences in the various 859 different benefits that are distributed by different offices. We need to address that problem. One solution would be to have a citizens income.
The hon. Gentleman might not have expected to hear this from me, but I favour a citizens income whereby, regardless of people's means, condition or predicament, someone would be guaranteed a basic wage of, for example, £50 a week. That person would be freed from benefit traps, distortions of labour markets and everything else that impoverishes the category of Britain about which he could have spoken more today.
Beveridge said in his principles:The state, in organising security, should not stifle incentive, opportunity and responsibility. In establishing a national minimum, it should leave room and encouragement for voluntary action by each individual to provide more than the minimum for himself and his family.At the moment, that principle is not being delivered in practice. If somehow across the Floor of the House the parties can find some common ground for alleviating poverty, we will have done the country a great service. However, we are not going to find it simply by making great political noises and talking only of inequality. which has nothing whatsoever to do with poverty and diverts attention and proper thought from all our dutyon>: to help those who are poor to the best of our means and not to use them as some Opposition Members risk doing—as political pawns for their own political objectives.
§ Mrs. Helen Jackson (Sheffield, Hillsborough)
I am grateful for the opportunity to add my voice to the growing public concern about the divide in society.
Last night, I attended a meeting in my constituency of parents and governors who were concerned about the cuts in schools and the effect that would have on class sizes. The unanimity in that hall and the despair about the damage to the fabric and the future of society was such that one of my constituents pleaded with me that we in the House should forget party politics and agree to halt the deepening crisis. If that constituent had been here this afternoon, he would have realised that it is not so easy.
The Rowntree report, which was published last week, is simply a further particularly authoritative report about the bald facts of the growing divide of income, poverty and wealth in Britain, but it is not even recognised by Conservative Members.
Government statistics—most of the reports are based on Government statistics—analysed back in December by the Low Pay Unit show that the disposable net income of the bottom tenth of the population after housing costs had dropped by 17 per cent., while the top tenth showed an increase of 52 per cent. The report is further evidence of that fact. It leaves Ministers clinging desperately to the statistic of the average, the median and the mean—as the Prime Minister did this afternoon—because that is how they can disguise and hide the deepening divide. Average statistics may be all right, but the Government increasingly use them to mask the truth or flounder in waffle about self-employed accountants in the bottom wealth decile.
If deepening relative poverty is universally recognised, except by Conservative Members, Rowntree has shown us the hopelessness of absolute poverty. There is no question about some of the examples in the report that we all know 860 well. The pensioner couples living on £63 a week are straight poor. It makes a nonsense of the Government's frequent insistence that they are about providing choice. If people are poor, they do not have the choice of private health care or education; they do not have the choice of where to go shopping. They have to take the cheapest possible route.
I am not interested in looking only at the bottom end of the scale; we must also examine the 20 per cent. of people at the top of the scale. I well remember doing just that in Sheffield when the poll tax replaced the rates. In the leafy suburbs of south-west Sheffield, that change represented tax windfalls of up to £2,000 a year. At that time, such a windfall was being enjoyed by a number of Conservative councillors on the council. The council tax never righted that injustice, but every time an essential charge supplants one that is wholly or partly met by tax revenue, the wealthy benefit and the poor struggle to pay or do without.
The examples are too numerous to count. Prescription charges of £5 do not hurt the people in the top fifth of the income scale, but are a struggle for people in the bottom fifth, who may go without. Deregulation of bus fares is no problem for those who have two cars and do not use public transport, but those who are poor struggle or do without. What about water meters? It is no problem for those on a high rateable value to have a water meter, but those charges matter for people who are poor and have large families. That was behind the anger on VAT on fuel. It was thrown out so convincingly because it was a charge on an essential service.
Where do we start? I suggest that in the first instance we have to examine three areas. We must, first, look at wages, salaries and income. At the bottom end of the scale, we believe that a minimum wage adds dignity to people's efforts in the workplace. It tames the excesses of the free market, whereby people are asked to work for as little as they feel they can possibly manage. They survive on the crumbs. There is no reason in a free market why people should not work for 50p or £1 a hour if the market will stand it, but that is not okay for the dignity of people's efforts. Most employers agree that the minimum wage adds efficiency to the workplace and does more than any other penalty system to reduce the problems caused by the working of the cash-in-hand, black economy for the poorest tenth of the population.
It is simply not on to say that the salaries of the top executives and chairmen of public utilities, whose incomes are derived from our electricity, gas, and water payments, should be left to company shareholders to decide. Our money is being creamed off in totally obscene and excessive salaries, share options and pay rises way above the sum that any British household today requires to enjoy a high standard of living.
We must control the top level of wages and salaries. An unfair system breeds increasing unfairness. That was evidenced by the public pay round last year, under which the nurses received a pay increase of 1 per cent., the doctors received 2.5 per cent. and senior civil servants received £150,000 or whatever they deserved according to performance pay. An unfair system puts pressure on the public pay rounds to increase that unfairness, not just for those at the top and the bottom of the wage and salary scale but for those in the middle as well.
861 We must address the question of equal treatment for all. The Fawcett Society and other pressure groups concerned about equality believe that, if the Government continue on the course outlined in the Pensions Bill, two out of three women who will retire after the year 2030 will live in poverty. The Pensions Bill, which is now being debated in the other place, passes over the needs of part-timers, divorced women and housewives. They are denied any real benefits which will flow from that pensions reform. An enormous opportunity has been lost.
As we saw last Friday, the Government are unable or unwilling to do anything meaningful for the disabled. The incapacity for work legislation will affect those on invalidity benefit as well.
We must recognise the role that public services play in determining standards of living. I was shocked to hear that the Government propose to bring down the shutters on one more tenuous, but valued, route out of poverty—the 21-hour rule, by which people can gain entry to adult education courses. That is an appalling proposal. It shows that, unless core public services are valued as being integral to our standard of living in Britain, the present divide between the rich and the poor will remain for a very long time.
§ Mr. Alan Howarth (Stratford-on-Avon)
The Rowntree report should be a landmark in our public debates. Its tone—calm and reasonable, but earnest and urgent—is in the best traditions of Rowntree and the data that it assembles give us much food for thought. In October 1993 I wrote an article in The Guardian in which I said that trickle-down theory had not worked out for the poorest 10 per cent. of the population. It gives me no pleasure that the Rowntree report powerfully endorses that observation.
I shall not repeat the statistics that have been quoted so often today, but they confirm that the standard of living of households on the lowest incomes has not risen since 1979 and that the dispersion of income has widened greatly. My right hon. Friend the Secretary of State for Social Security made a characteristic speech on that subject last November, blending his intellectual rigour with his humane concern.
The Conservative party need not apologise about the main thrust of economic policy in the 1980s. It was in the interests of all of our people to bring down inflation, balance our public finances, deal with some of the rigidities of the labour market and provide managers with the opportunity to manage. We never pursued what the hon. Member for Dumfermline, East (Mr. Brown) called in his article in The Independent on Sunday "simple-minded" free market policies.
We were not so naive as to suppose that the untrammelled operation of market forces would optimise social outcomes, and there has been massive intervention and expenditure by the Government in the inner cities, on the education system and on social security—and rightly so.
Of course, we have not found all of the answers and the policies that are appropriate in one phase of our development may become less appropriate in another phase. We may need to alter the emphasis. We should 862 certainly not pursue the reduction of taxation or the reduction of public expenditure as a proportion of national income to the ultimate, and I suggest that we should be extremely cautious about further deregulation.
In its leader last Saturday, The Times offered siren advice. It said that the Rowntree findings were "dubious" and it even accused the authors of manipulating the data. It asserted that inequality in Britain was within the bounds of the tolerable. Even at 20p a copy, I fancy that The Times is expressing very much a minority opinion. It did find three academics to offer comfort to the complacent—Messrs. Minford, Anderson and Green: see no evil, hear no evil, speak no evil. Admittedly, Professor Minford observed that it is a "savage world".
It is indeed a savage world, and we must respond to that. Our policies must emphasise healing the divisions within our society. It is perhaps all too predictable for me to quote Disraeli, but in "Sybil" he wrote oftwo nations between whom there is no intercourse and no sympathy, who are as ignorant of each other's habits, thoughts and feelings as if they were dwellers in different zones or inhabitants of different plarrets".If any hon. Members are tempted to think that that is a purple passage from a Tory Member of Parliament who turned his hand to writing novels because he had nothing better to do, they are wrong. I refer them to chapter 6 of volume 2 of the Rowntree findings if they need to be persuaded that the problem of the two nations is still with us.
The section on "The Location of Poor and Rich Neighbourhoods" shows that there was a concentration of poverty in 8.9 per cent. of wards in this country in 1991, compared with 7.5 per cent. in 1981. Far too many of those wards are the same in both surveys.
Other research shows concentrations of poverty, in Oxford and Oldham, which are geographically cheek by jowl with areas of affluence. They are worlds apart in terms of income, yet extremely close together geographically.
In 1872 Disraeli concluded that the "great object" of the Conservative party should bethe elevation of the condition of the people".In 1965 Iain Macleod, addressing the Conservative party conference, reiterated those Tory values when he said:We shall be called upon to convince the electorate that we stand for humanity as well as efficiency; for compassion as well as competition".Latterly, we have perhaps been at risk of neglecting that balance and I think that we should attend to its restoration. That Tory tradition is the authentic Tory tradition and it is the only one to which the voters of this country will give continuing loyalty.
Perhaps not many voters read Coleridge, but he observed to Harriet Martineau, an eager radical, thatSociety is not an aggregate of individuals".It is the role of Government to maintain the cohesion of society—a society that embraces all its members. Extremes of inequality are not acceptable. My right hon. and hon. Friends should note very carefully the outrage that is being expressed at the extremes of pay increases and rewards that are being reaped by the directors of some privatised companies. It is not the politics of envy; it is the politics of fairness. I put it to my hon. Friends that they should not insist that only absolute poverty matters. Relative poverty matters very much indeed because we define ourselves as members of society.
863 Certainly, our Government should not practise the politics of exclusion. It is wrong to propose in the Jobseekers Bill that some young people should live on £21.70 a week, or even nothing at all if they are sanctioned. It is wrong to chip away at national insurance and the contributory principle, because they are the keystone of our social contract. It is wrong that in the Disability Discrimination Bill we should exclude from the scope of protection people who happen to be employed in firms employing fewer than 20 people.
My right hon. Friend the Secretary of State for Wales observed in an article recently that "markets are social events", as no doubt they are—for those who can get to market. But if the Disability Discrimination Bill largely ignores transport, the disabled will not be able to get to the party or to the labour market. I use the term "'labour market" because it is the term that we all use, but we might care to reflect that its dehumanised language may tell us something about our own deficiencies. I do not know whether my right hon. Friend considers the foreign exchange markets as social events, but it strikes me that those young men with their braces and champagne omit to invite the low-paid to their exclusive celebrations.
Efficiency is not the same as fairness, and unfairness is inefficient. If people are to be excluded from our society through unemployment or marginalised through low pay and low skills, we deprive ourselves of their talents and potentialities. The costs of maintaining law and order, of repairing our inner cities or our social fabric are immense. Indeed, as my right hon. Friend the Secretary of State for Social Security grimly points out, they are unsustainable. Nor would I wish to sustain the present pattern, and indeed we shall not, of course. Only the extreme short-termism of the Treasury could provide an open-ended subsidy for low pay by way of family credit. We can see it coming: next year's public expenditure crisis will be about family credit, just as this year's—allegedly, at least—is about housing benefit. Mr. Howard Davies was right to say that inequality is a sign of a malfunctioning economy.
If my hon. Friends are not moved by the thought that poverty is a drag on the economy, let them consider what it does to families and children. We find five times the number of children on at risk registers in the poorest areas compared to the better-off areas. There is an estate in Wales where only 7 per cent. of adults are in full-time employment. How can they provide role models for the children? The disadvantages that those children suffer early on—in terms of language skills and health, for example—persist. They are our future. There is an obligation from one generation to the next. As Burke said:Society is indeed a contract … a partnership … between those who are living, those who are dead, and those who are to be born.The Conservative party must accept the need for public investment, in the interests of us all, in those services that are not going to be privatised. We should not—we could not—privatise education. If we devalue our schools, as I fear that we shall in this year's local authority settlement, it will be as damaging to this generation as devaluation of their money through inflation was to a previous generation. Education is crucial in terms of opportunity—fullness of life—for every individual. It is crucial in terms of the quality of our future society, and in terms of our future competitiveness.
§ Ms Jean Corston (Bristol, East)
The Rowntree report is no surprise to those who have followed the course of changes in income and wealth in the past 16 years. Even official Government published statistics make the growing gap between the rich and the poor indisputable.
The growth of inequality is no surprise to the Government either. Several times in the past 18 months a succession of my right hon. and hon. Friends have asked the Prime Minister to confirm both growing inequality and poverty. Since 1979, the average disposable income of the richest 20 per cent. of households has increased by £6,000 a year, at April 1994 prices. But the average disposable income of the poorest 20 per cent. of households has fallen by £3,000 a year, compared with the incomes that they would have received if policies and the distribution of earnings had stayed the same. That is one way of bringing out the dramatic and unprecedented growth of inequality in Britain.
The Prime Minister told me, none the less:The net disposable income of people at all ranges of income has increased".—[Official Report, 22 February 1994; Vol. 238, c. 146.]He told the late Leader of the Opposition, John Smith:There is an improvement in living standards at all levels, even among those who are the least well off."—[Official Report, 24 February 1994; Vol. 238, c. 428.]That was untrue then, and it is untrue now. After the exchanges in the House, which other hon. Members as well as myself have sustained to this day, I wrote a detailed letter to the Prime Minister citing Treasury and Department of Social Security evidence to show that substantial groups of the population now have disposable incomes which in real terms are lower than such groups had in 1979. He dodged the issue, and continued to do so after I wrote again at length. He replied in August 1994, but he and other Ministers continue to dodge the issue because it is too uncomfortable for them.
Even the 1995 jubilee edition of "Social Trends" no longer has the critical table showing the absolute decline in real income of the poorest 10 per cent. and 20 per cent. of the population—it was table 5.21 in the 1994 edition. I can presume only that Government statisticians were under pressure not to publish that table, or were inhibited from doing so by the deliberate deception now being exercised by the Government as a whole on the issue.
This is a key point in the sorry tale of Tory deceit and prevarication, and one which the otherwise admirable Rowntree report hesitates to drive home. It is not just the growing inequality or poverty, but the smaller real income among millions of poor people. Their incomes are falling and, unhappily, more people are joining them. I do not just mean the rise in the number of homeless people, especially the young homeless, although that is tragic enough, but families with children, the unemployed, those in casual, part-time and self-employment, and pensioners, too.
On 31 August 1994, the Minister for Social Security and Disabled People informed me, in response to a written question, that in 1991–92 the disposable income of the poorest 20 per cent. of families with children, after adjustment for composition and size of household, was lower than that of the poorest 20 per cent. in 1979. We are talking about 7 million people in families with children who are worse off than their 1979 predecessors, whether income is measured before or after housing costs.
865 Among the poorest tenth, the situation is even worse. At 1994 prices, the income of a couple with two children aged three and eight was £996 lower in 1991–92 than in 1979, whereas for the same period an identical family in the richest tenth of the population had an extra £14,300 a year income. That is what has happened under the Conservative Government—and the Prime Minister has the brass neck to tell my right hon. Friend the Leader of the Opposition that he agrees that it is a responsibility of the Government to reduce inequality.
Even pensioners in the poorest tenth of the population have a lower real disposable income than in 1979. Single pensioners in that category experienced a decrease of £676 a year, and couples £52 a year at April 1994 prices. The Department of Social Security does have a standard of low income in 1979 terms—buried away in the deep recesses of the "Households Below Average Income" report. It is defined as the median income in 1979 of the poorest tenth of the population, adjusted for inflation to the present day. It would be bad enough if, after 16 years, that figure was still relevant to today's conditions, but the situation is worse than that. It is contrary to all the statistics of average growth. It shows that the number of children living below the 1979 standard of low income has increased—from 790,000 to 1,060,000.
The DSS gives another measure of low income in 1979: half average household income in that year. The number of children in families still below that miserable level has also increased—from 1,310,000 to 1,850,000. The same source discloses that the number of people living below the 1979 standard of low income who are in employment has also grown. That group includes more self-employed people and more people in both full-time and part-time work.
A range of statistics that I received in August was published in Hansard on 26 October 1994. When I wrote to the Prime Minister again, he referred the matter to the Secretary of State for Social Security, who did not deny any of the figures that I had put to the Prime Minister. His reply, on 18 December 1994, dodged the responsibility of agreeing on what factual basis we could have a reasoned debate about the implications for action. He added, at the end of his letter,The most important point is that the Government should identify what trends underlie the results and put in place policies that ensure that everyone has the opportunity to share in the increasing wealth that the HBAI results show for the vast majority.The Government must recognise that there is a momentum against the poor: a multiplication of tax, social security, employment and deregulation policies which are reducing Britain's poor to third-world status and desperation rather than merely continuing a process of polarisation. That momentum of divergence has been built into the entire range of institutions and policies in this country. It is like a geological fault built into the social landscape, with sections of the population sliding into an abyss.
We can no longer speak only of the deterioration of the conditions of poor people relative to those of others; this is a deep and deepening social divide, with millions losing absolutely rather than just relatively. It is self-destructive social engineering, manufactured by the Government—
§ Ms Corston
No, I have only 10 minutes; the hon. Gentleman can make his own speech.
That self-destructive social engineering is harming the security, the common interests and, indeed, the future prosperity of rich and poor alike.
All that is thrown into stark relief by recent examples of magnified greed. PowerGen's Ed Wallis says that he is worth £1.2 million; British Telecom's Sir Iain Valiance says that his £770,000 salary is "modest"; British Gas's Cedric Brown is revelling in a salary of nearly half a million. Meanwhile, question 18 in the proposed jobseeker's allowance questionnaire asks, "What is the lowest wage you are willing to work for?Yesterday, at my constituency surgery, one of my constituents—a qualified chef who used to work for Rolls-Royce—was put in touch with an employer who had a job going in a bakery. He rang up, and was told that the pay was £1.90 an hour. A job was advertised in Bristol just before Christmas at £1.61 an hour. What implications has that for the family credit budget, in which good employers are subsidising bad ones? What implications has it for the "feelgood factor"? Anyone who watched "Panorama" last night would have been shocked to see the difference between the life chances of the rich and those of the poor.
John Maples was right: the people of this country know that the rich are getting richer on the backs of the rest, who are getting poorer.
§ 8.2 pm
§ Mr. Hartley Booth (Finchley)
I understood from the Order Paper that the debate was supposed to be about poverty. Although I respect much of what the hon. Member for Bristol, East (Ms Corston) said, I intend to return to that subject, rather than wallowing in the politics of envy: I want to get away from the whole business of inequality. Equality is not the sole yardstick that we should use when discussing the crucial and often sad issue of poverty.
I also wish to set a new analysis alongside that of the Joseph Rowntree Foundation. I have benefited from the excellent work of the House of Commons Library researchers, whom I asked a number of questions about comparative income, benefit and tax figures between 1979 and 1993. As other hon. Members do not have the result of that analysis before them, perhaps I could devote most of the 10 minutes allotted to me to presenting it. I believe that it is illuminating, and puts in context what has been at the core of much of the debate. The hon. Member for Glasgow, Garscadden (Mr. Dewar) said that the Rowntree report was the fons et origo of the debate from Labour's point of view.
According to the Library, in 1979 the income of the top 20 per cent. started at £11,000, and that of the bottom 20 per cent. at about £1,800. When state benefits are added, the figure rises to nearly £11,000 for the top 20 per cent. and more than £2,000 for the bottom 20 per cent.—in terms of gross income with benefits. When tax is taken off, the income of the top 20 per cent. falls to £8,000 and that of the bottom 20 per cent. is lowered very slightly, remaining at about the same £2,000 level.
Let us then add or subtract—depending on whether we are dealing with the bottom or the top quintile per cent.—the indirect taxes and benefits in kind. That produces a 867 figure of £7,800 for the top 20 per cent., and just over £2,300 for the bottom 20 per cent. Thanks to the contribution of the rest of us, the income of the bottom 20 per cent. in 1979 has thus been raised by 30 per cent., while 259 per cent. has been taken from that of the top 20 per cent. by the rest of the community. The gap exists.
I need not go laboriously through every stage in the same process in 1993, but hon. Members will know that process: add benefits, take off tax and then deal with indirect taxes and benefits in kind. The top 5 per cent. are now giving the rest of us 290 per cent.: in other words, the tax take from that group has increased by 31 per cent. Meanwhile, the income of the bottom 5 per cent. is up by 28 per cent. The gap referred to by so many Opposition Members is narrowing by 30 per cent., from the top; it is about 2 per cent. in all. I do not want to confuse the House.
Even on those figures—before we employ other yardsticks relating to money and poverty—it is clear that the findings of the Rowntree Foundation, honest and well meaning though it doubtless is, need to be reinterpreted. I believe that poverty should be viewed not only in terms of money and goods, but in terms of ideas. I was grateful to the hon. Member for Garscadden for widening the debate slightly and discussing poverty in those terms, but he did not go on to make the obvious point—he wouldn't, would he; it is a point in our favour—that, while one in eight school leavers went to university in 1979, one in three go now.
The university figures mean that the ladder of opportunity is there for all to see. We have tried to help education in a number of ways—for instance, through the provision of city technology colleges. Apart from a reference at the beginning of the debate, I have heard nothing about that; although, unfortunately, my membership of a Standing Committee meant that I had to be absent for part of the debate.
My time is getting thin, so I shall be quick. The context of our debate has been muddied considerably because we have failed to talk about the reality of poverty as we see it worldwide. No proper reference has been made to the fact that poverty in this country is comparative riches compared with poverty in the third world. A proper analysis has not been made of the various definitions of poverty. Nowadays, apparently, even not having central heating is a criterion of poverty, but there are millionaires without central heating.
§ Mr. Booth
That is why we need to analyse what is and what is not poverty. That is the core of the debate and of our discussion. That is why we need to define it ourselves.
The Bearsden pictures on "Panorama" last night were heart-rending. That is not surprising if one considers what we saw—housing provided by the state, the man who had gone through endless training sessions provided by the state, and the sad woman who was being provided with national health service benefits. All that was a microcosm of the promise of Attlee and of socialism. The scene was poverty-stricken in terms not only of money, but of ideas. Those people's lives had no purpose.
Not surprisingly, we heard in last night's tragic film of a high incidence of suicide. No individuality or uniqueness could live in those drab socialist-inspired 868 buildings. There was no dignity there that is the other aspect of poverty with which I want deal, and with which socialism does not deal. The solutions that Conservative Members have wanted have not been supported by the hon. Member for Garscadden, or by other Opposition Members during the part of the debate that I have been able to hear.
We have not heard that the number of people on the lowest wages fell from 1975 to 1978. We have not heard that there has been a distortion in the figures, thanks to rich people being able to return to this country following the 1979 election. Some reference has been made to this, but we have not heard much about the fact that, thanks to a strong and growing economy, income support has increased by 24 per cent. for a typical unemployed couple, by 18 per cent. for a typical pensioner couple, and by 30 per cent. for a single pensioner.
Equality is not a helpful yardstick; real poverty is. Compulsory equality, ordained by socialism, communism and Opposition Members—if they ever had the chance—is the one sure recipe for poverty.
§ Mr. Frank Field (Birkenhead)
Like other hon. Members in the Chamber and elsewhere, I rejoice at the increase in incomes since 1979. It would be folly for anyone to deny that basic fact. The debate tonight is different from that. It deals with the impact of rapidly rising incomes. How has that increase been shared? Has it been fair? Is it sustainable? The charge against the Government is, in a sense, a unique charge. It is that, under their stewardship, they have done well in increasing national income, but that a part of the British political tradition has been destroyed.
In the past 400 years, incorporating more people into the body politic has been one of the great movements in politics. Great struggles took place, therefore, for equality before the law, and for freedom before the law. There were the struggles over the franchise. Great efforts have been made in this century to establish greater economic and social equality.
It would have been fair, therefore, to think of British society as being like a train journey. There were first, second, third and fourth-class compartments. The living standards of those in the four compartments were clearly different. One could say with all certainty that the train was heading in the same direction and that all the carriages were linked. The charge that we are making tonight is that, despite the growth in wealth, or perhaps because of the way in which that growth has been gained, the fourth coach has been decoupled and no longer heads in the same direction.
I do not have the statistics that other hon. Members have deployed in this debate. I merely wish to bring some of my constituents and their faces, feelings, hopes and aspirations into our discussions. One can see the faces of the people in that fourth-class carriage, which has been decoupled from the train on the main journey that the rest of us, fortunately, are embarked upon. They are the very elderly poor—those who have had no chance of building up a second pension.
Clearly, important policy recommendations have been made on how everyone can receive those second pensions. Of course we know what to do to ensure that the poorest pensioners can be part of the train journey again. We 869 could credit them into the state earnings-related pension scheme, so that the entitlement would not live beyond them but die with them, and their standard of living would increase appreciably
We know that single-parent families are one of the biggest groups in that fourth-class carriage. All hon. Members must be worried about the rate of the increase in the number of children who are cared for by only one parent. We all have an interest in their welfare. As taxpayers, perhaps paying up to 5p in the pound for non-payment of maintenance, we have an interest in the Child Support Agency working a little more effectively than it does.
Given that large numbers of those single mums, for they are single mums generally speaking, will get out of the fourth-class carriage by marrying—perhaps the Secretary of State for Social Security should spend more time on how to make that easier for them—we need not be too concerned about them in the long run, although we are immediately concerned about them. We must be concerned about the males in that fourth-class carriage who are semi-skilled and unskilled. If things go on as at present, they will never work again in their lifetime.
In Birkenhead and in Liverpool about 20 years ago, 26 million tonnes of goods came in and out of the port on both sides of the river, and 20,000 dockers were employed. This year, an additional tonnage has gone in and out of the port, and only 400 dockers have been employed. Semi-skilled and unskilled jobs for male workers have been wiped out. What are we going to do about the disfranchised male? That is one of the issues that we must face.
Clearly, as a group, those males are far less able than women to adjust, and to box and cox in the labour market. Males have all sorts of hang-ups about our roles and about what we deserve. Clearly, however, other factors are at work, which prevent jobs from reaching that group. We are concerned about that.
I applaud the Joseph Rowntree Foundation study for considering how the Government have decoupled that fourth carriage of Great Britain Ltd. so that it no longer heads in the same direction as others, but I disagree about where we go from here. I am pleased beyond belief that the Rowntree study talked about self-interest, which is an important part of human motivation. The biggest three motivations are self-interest, self-improvement and altruism. The weakness of the left has been to believe that we can build a social or even an economic policy on altruism. We cannot.
Let us consider what the Rowntree report thinks of as self-interest. It states that middle England—the people in the first three carriages—will give up some of their privileges or the speed of their train for fear that they will be set on by bandits. I have news for Rowntree: if that is so, in the next 10 years middle-income England will be voting for and insisting on corporal punishment to deal with disorder rather than voting for tax increases. Any welfare reform has to be built on the basis that there is something in it for those in the first three carriages. That brings me back to the national insurance fund, a subject that has already been mentioned.
Clearly, we have to rethink the scheme and make clearer the link between people's benefits and earnings. If there is to be a redistribution—the altruistic side that I 870 believe exists—it has to be above board. We must not think that we can kid people that we can fiddle their contributions and pay them to someone else. There has to be a positive decision by the taxpayer via the Exchequer. The reform of the welfare system is, I hope, the task in hand. We need a new system in place soon if there is to be a clear alternative to what is being offered by the Treasury Bench and its supporters.
We have had a clear model of how the Treasury will deal with the inhabitants of the fourth-class carriage who are no longer participating in the journey being undertaken by the rest of us. The Secretary of State devises raiding parties to catch a few and drag them to join the rest of us aboard the main train. He devises back-to-work benefits and the additional bonus, in cases where the Child Support Agency is working and collecting the maintenance, when the mother goes back to work.
All these measures are to be applauded, and every experiment must be examined with interest and extended if it is a success, but I do not believe that we shall get back to the policy of incorporating people into the mainstream of society if we are concerned only with devising even more effective raiding parties. We need a strategy to get the fourth-class carriage back on to the main line to be a part of the journey that the rest of us are, fortunately, making.
I end as I began. I do not dispute the figures that show an increase in incomes since 1979. I rejoice in them, and I am pleased that some have been able to benefit, but the flip side of that is a very—
§ Madam Deputy Speaker (Dame Janet Fookes)
Order. I am sorry, but the hon. Gentleman has had his 10 minutes.
§ Mr. Michael Trend (Windsor and Maidenhead)
I am sorry to have missed parts of the debate. I was present for the opening exchanges but then had to attend Standing Committee A.
It is a pleasure to follow the hon. Member for Birkenhead (Mr. Field), who made a characteristically thoughtful speech. However, I cannot agree that the fourth carriage has become decoupled. That is certainly not the case according to the evidence of the Rowntree report to which I shall refer in a moment. I was, however, intrigued by the hon. Gentleman's idea that the Secretary of State should "cure" single mums by what seemed to be an advocation of serial bigamy. The idea that he should somehow marry them all off was rather nice.
I heard the speech made by the hon. Member for Glasgow, Garscadden, (Mr. Dewar), but I was rather disappointed. Like other hon. Members, I had a high opinion of the Joseph Rowntree Foundation. I once had the honour of working for some time at Toynbee hall in London's east end. I can confirm that the foundation's work in many spheres is widely respected. On this occasion, however, I regret that the foundation has been drawn into the smokescreen beneath which the Labour party is hiding its reluctance to make policy.
The Rowntree report is in many ways a very old-fashioned piece of work. It covers ground which we have been over many times but does not appear to notice that the debate has taken new directions in recent years. 871 We must all look more widely and deal with the great issues of social change, especially marriage breakdown, over which we all admit that the Government have little or no influence.
The report's proposals are familiar enough. Many Conservatives feel that most of them have been or are being tried, and some have been found wanting. Moreover, it is very important to note that the proposals are not costed and overlook the progress that has been made by the Government in many of the matters under discussion. In brief, the proposals call for a huge increase in public expenditure in nine respects, and that is simply not on.
As well as political doubts about the report, I have doubts about its methodology, a point that some hon. Members have mentioned. The hon. Member for Garscadden quoted from the front page of this week's edition of The Sunday Telegraph, but I wonder whether he read as far as page 21 where the admirable journalist Mr. Paul Goodman exposed the flimsy starting point for the Joseph Rowntree Foundation's evidence, or what lies at the heart of the report.
In his article, Goodman makes the distinction between relative and absolute poverty. I shall return to that issue in a moment, but I shall deal first with his point about the report's most important claim, which was also quoted by the hon. Member for Garscadden. That claim is:Since 1979 the lowest income groups have not benefited from economic growth".If that claim were true, it would indeed be proof that the very poorest have experienced an increase in absolute poverty. However, as Mr. Goodman states, the claim is unproven.
The report's judgment relies on two key figures to identify the poorest 10 per cent. of the population, examining their incomes before and after housing costs are taken into account. The claim is that the incomes of this group have remained the same before housing costs are considered or have fallen by 10 per cent. afterwards, but, as Mr. Goodman also points out, those figures are based not on firm evidence, such as tax returns, but on the "Households Below Average Income" survey.
I would go much further: the HBAI figures themselves have a number of important methodological limitations. They are based on a sample rather than a census and did not track individuals for any length of time, so they cannot reveal how many people have seen their incomes rise or fall. The HBAI figures are in turn based on the family expenditure survey whose data are collected mainly from expenditure figures, not from income figures. Moreover, the FES uses interviews to gather data, and we must admit that it is at least possible that some respondents might misreport their circumstances.
We must also observe that the HBAI figures relate to the period up to 1991–92 when interest rates and unemployment were still high. Since then, unemployment has fallen substantially—by more than 500,000. In addition to its methodological problems, the HBAI gives a picture of the past. In more general terms, the survey also provides conflicting evidence about the living standards of the poorest.
A large number of self-employed people such as farmers, taxi drivers and accountants report no income at all, although perhaps we should not be surprised that 872 accountants manage to show no income. Surely it is rather odd that only about half the people in the bottom 10 per cent., excluding pensioners, are on income-related social security benefits. What are the other half doing? That question must be asked.
The Secretary of State cited HBAI survey figures for individuals in the bottom 10 per cent. of income distribution who now have access to freezers, fridge freezers, telephones and video recorders. They show substantial percentage increases in the possession of these consumer durables. That is at the heart of the debate. It is important to note that, in relative terms, things are not as bad as they were. Based on such statistics, Mr. Goodman is right to say that the Rowntree report's main claim is, to say the least, disingenuous.
I should like to comment on the distinction between absolute and relative poverty. There can no doubt that we all deplore absolute poverty, and the ever-increasing billions of pounds that are put into the welfare system are evidence that we deplore it; but we must be careful not be trapped by any absurd definition of an abstract poverty line. It is plainly ridiculous to use any definition in which to be below, say, half the average income or any other similar specification is to be poor. Such a definition would mean that poverty would rise every time average incomes rose.
Others define the poverty line in relation to income support levels and that, too, has severe problems, as does the definition of a poverty line based on average expenditure. What happens to those who save rather than spend? Under that system, some very rich people would easily be classified as poor. None of those definitions will do. Poverty is a very emotional word. If we are beguiled by any of those definitions, relative poverty will, self-evidently, always be with us. I have severe doubts about the use to which the Rowntree report can be put.
There is, however, another much more reliable document which shows what has happened in recent years in the social conditions of the country. I refer, of course, to the annual publication "Social Trends". Unfortunately, I do not have time to go through the various figures that show the great increases in public expenditure, on social security, health and education, and, indeed, show the changes in people's lives that have resulted in the majority of people becoming wealthier. However, the figures from "Social Trends" show clearly that while the country is getting wealthier and healthier, it may not be getting any wiser.
I wonder sometimes whether the great problem which we face nowadays is not relative poverty but relative prosperity. Why will not many people simply accept that they are getting richer and not count themselves as poor? Why do they seem to get more miserable as they receive more of the supposed material benefits of life? That, of course, is another debate, but it has some bearing on today's continued exhibition of the arid politics of envy expressed by the Opposition.
§ Mr. John Denham (Southampton, Itchen)
My father was employed as a village schoolmaster in east Devon. When I was seven years old—the same age as my daughter now—we did not have a refrigerator, a television or central heating. Does that mean, as Conservative Members suggest, that when I was seven I was poorer 873 than my present constituents who have a television and a refrigerator? I think that is absolute nonsense. Of course poverty is relative to the wealth, income and life styles of those who live around us. Any other definition of poverty makes no sense at all.
Whatever else the Rowntree report may prove, it establishes beyond doubt that many, many people in our society live in poverty because their income is insufficiently high to enable them to participate fully in the activities of society and to enjoy in a reasonable way the benefits of that society like other people. That is not the politics of envy. My constituents are clear about that and I do not think that a distinction can be drawn between Labour and Conservative voters. If they were to see somebody from the constituency set up a business, work hard and make a success of it, they would wish him good luck and think it right that that person should be rewarded for his enterprise and effort.
My constituents know the difference between such enterprise and somebody who happens to be the boss of a privatised industry, who has the power to write his own cheques on the basis of a monopoly which he can exploit. People understand and do not resent justified inequalities in our society, but they resent rampant unfairness and greed that sit side by side with deep poverty.
The Secretary of State told us that he did not wish to pursue the phantom politics of envy but, rather, wanted to show how the Government were concentrating on helping people to get out of poverty and to help themselves. The Government's record does not suggest any significant degree of success in that self-defined enterprise. Poverty is no longer a northern or a Scottish problem, but a problem which has been made national by the failure of the Government's policies. Let us dwell on some of the measures of that failure.
At Christmas, 400,000 children in Hampshire, Sussex, Dorset, Kent, Berkshire and Surrey—the main southern counties—faced what I would regard as Christmas in poverty because they and their parents were dependent on state benefits. Ministers do not grasp the reality of juggling inadequate incomes to buy presents. In all probability, all too often, people have to borrow money at extortionate interest rates to be able to afford to buy presents at Christmas for their children. That poverty, right across the heart of England, has been created by the Government and they appear to be unwilling to do anything about it.
When people turn to the state social security system, there are certainly plenty of disincentives which prevent them from receiving assistance. The truth is that a third of the applications for social fund loans for items as basic as beds, cots and clothing are refused, not because the applicant does not meet the criteria for a loan but because the cash-limited funds have run out. The Secretary of State has devised a cruel system, which tells people that their needs will be assessed and, yes, by the Government's criteria they will qualify for a loan, which will have to paid back, but, having decided that that assistance is needed to buy a bed, or some clothing, or a cooker, or, dare I say it, even a refrigerator, they are then turned down because there is not enough money in the system.
The Government say that they aim to help the long-term unemployed. What is the position in my constituency and in Hampshire? Between 1990 and 1994, 874 the number of long-term unemployed in my constituency, as well as in Southampton and Hampshire as a whole, trebled. What is more, the proportion of long-term unemployed people rose. We have heard a lot from the Government about helping the unemployed get back to work. Even when one disregards the high point of the recession to be fair, the reality is that the number of people who have gone on to the dole queues, who have stayed there and who are unable to get off, has risen dramatically in absolute terms and as a proportion of those out of work. There is absolutely no evidence whatever that the Government's policies, which they say are directed towards those most in need, are enabling people to get back into work.
A comparison of the figures for long-term unemployment in 1990 with those for 1994, the most recent year for which figures are available, and the impact of Government training schemes, show that a higher proportion of the long-term unemployed who go on training schemes remain unemployed today than four or five years ago. Indeed, 60 per cent. of the long-term unemployed go back to the dole queue six months later and only 16 per cent. of the long-term unemployed manage to get into full-time work after one of the Government's training courses. Five years ago, at least a quarter of those who had been out of work for a year or more managed to obtain full-time work after a Government training course.
Where is the evidence that any of the Government's policies help those who are most in need to get out of unemployment and to achieve security? There is no evidence of that if we consider the operation of the social security system or the operation of the Government's policies towards the long-term unemployed. There is no evidence when we consider the number of people who are trying to raise their children in poverty.
The Secretary of State delighted in a nit-picking performance on the statistics. However, he ignored the real issue, skating over it in about 30 seconds. After spending 20 minutes nit-picking on the statistics, he said that he did not think that there was absolute poverty in this country, inequality was not relevant and therefore there was nothing to debate.
However, inequality is relevant. Poverty is relative and the inability to participate normally in our society is undermining society itself. The Government must recognise that fact. There is a price to be paid for deep poverty, on the one hand, and ostentatious greed, on the other. It is the price of sending the message, as so many Conservative Back Benchers have done this evening, to the country at large that, if people feel excluded, that is the natural state of affairs.
There are great dangers for our society in sending out that message, as so many Conservative Members have done. We need a Government who say that it is a disaster to have so many people whose incomes are so low that they cannot reasonably share in the benefits of the society around them. We need a Government who will say that they will do everything possible to include those people in society.
If the Government do not do that, the whole of society will pay the price of the inevitable breakdown of the sense of community, and all that follows in relation to crime and deprivation. We will all pay a price. The Secretary of State looks pained by my comments. I understand that he does not like what I am saying, but we will all pay a price 875 for all the children who are raised in poverty and who will not succeed at school as well as they might if they had been raised in wealthier surroundings.
One need only speak to the teachers who are educating those children to understand that many such children—not all—bring a disadvantage to school that is no shared by children who come from wealthier and more comfortable backgrounds. We need an education system that enables those children to overcome that disadvantage. However, the Government are not providing that opportunity because, as we have heard time and time again—
§ Mr. Michael Stephen (Shoreham)
As this most important debate on poverty was initiated by the Labour party, I thought that it was important that I should be in the Chamber to listen to the Opposition Front-Bench spokesman, the hon. Member for Glasgow, Garscadden (Mr. Dewar). He is a sincere and intelligent man, but I was disappointed by his speech. He drew attention to many problems of which we are all aware, but he failed to make many proposals to tackle those problems. On the rare occasions when he was drawn into proposals on, for example, a minimum wage, he was unable to tell the House at what level it should be fixed and what effect it might have on the employment prospects of the very people who—[Interruption.]
§ Madam Deputy Speaker
Order. I do not want conversations between the Front Benches while another hon. Member has the Floor.
§ Mr. Stephen
The hon. Member for Garscadden was unable to tell us what effect a minimum wage might have on the employment prospects of the very people whom the Labour party claims to seek to help.
I was impressed by the speech of the hon. Member for Birkenhead (Mr. Field). His was a very thoughtful speech, but, with respect, he too was rather long on diagnosis and short on prescription.
I have read, as I imagine we all have, the Opposition motion which calls fora major welfare-to-work programme, a national childcare strategy and action to improve education and skills.I listened to Opposition Members' speeches and I remain of the view that the only Member of the House who has thought seriously about the matter, who has made proposals and who is doing anything about welfare-to-work is my right hon. Friend the Secretary of State for Social Security. In that regard, I refer to the jobseeker's allowance, the back-to-work bonus and the agreement that applicants for the jobseeker's allowance will have to make in future.
Many Opposition Members believe that every unemployed person is desperately seeking work and is quite unable to find it. However, our constituents know, even if we do not, that a great many people are working in the black economy and a great many others are not making a very serious attempt to find work. Therefore, the agreement is important. It is important that a clear programme is mapped out with the assistance of the Department of Employment so that the person concerned can get back into work as soon as possible.
876 Education is, of course, of great importance if poverty is to be avoided. That is why the Government have introduced some very imaginative reforms which, sadly, have been resisted root and branch by the education establishment and, it goes without saying, by the Labour party.
Those reforms were introduced not because the Government wanted to mess teachers about, but because employers were approaching us as constituency Members and saying, "We spend more money than ever before on education per child, but the results are appalling. You are sending us too many young people who cannot read, write or do arithmetic and, more important perhaps, who have entirely the wrong attitude to work."
That is why we have had to introduce the national curriculum and testing. We are interested not in what children have been taught, but in what they have learnt. If we do not find out what they have learnt until the end of their formal education, it is too late to do anything about it.
The Opposition motion calls for "a national childcare strategy". Opposition Members did not expand on that, but we are all aware that some single parents are genuinely in need. They are single parents through no fault of their own. However, we close our eyes to the real world if we do not recognise that the number of teenage pregnancies and illegitimate births has soared to epidemic proportions. Providing childcare facilities for women in that position involves taking money in taxes from many families who have decided that the mother should stay at home to look after the child. It is not easy for us to ask those families to pay taxes to support those who choose to, or have to, go out to work.
We must, of course, manage our economy well and I congratulate the Government on their management of the economy. Business people in my constituency say that what they need to create jobs is not on offer from the Labour party. They want low inflation, low interest rates and a competitive exchange rate for the pound. The most compassionate society is a society in which no one needs welfare.
In the few short moments remaining to me, I want to turn to what I consider to be an even more important subject, which has not even been mentioned in the debate so far. This debate is about poverty and we have focused throughout on material poverty. I want to refer to spiritual poverty. Throughout the land there are empty churches. The lights have gone out and, perhaps, will never be rekindled. In a very real sense, much of the light has gone out of our individual and collective lives. That has happened in the past 30 years, not just in this country but throughout the western world. The most important phenomenon throughout those 30 years has been television, which has found its way into every house in the land.
On television today, religion is treated as though it were a science—as though it were part of biology, physics or the like. Every day on our television screens we are treated to examples of people and communities where the lowest standards of personal behaviour are to be found. Today, morals are like clothes—they are whatever suits the individual. Perhaps D.H. Lawrence put his finger on it when he said that whatever is natural is right.
We have so much of a man-centred attitude to our lives today that one feels almost embarrassed to mention God in the House of Commons. There has been a breakdown 877 of respect in our society in the past 30 years—a breakdown of respect between men and women and between parents and children, and a breakdown of respect for all forms of authority. There has been a breakdown of respect within and for the family.
It seems that in order to reach the highest ranks of the Church of England one has to show that one does not believe in God. The Church used to be a rock upon which we could found our lives. It is now much more like shifting sand.
Of course, the economy, education and social security are important, but, however wealthy in material terms we may be, a nation which lives in spiritual poverty is truly destitute.
§ Mr. Thomas Graham (Renfrew, West and Inverclyde)
I have listened to the debate with great interest. As usual, Conservative Members have said that Opposition Members' speeches are not so good. The reason for that is that Conservative Members do not like the truth when it is spelt out to them.
The hon. Member for Shoreham (Mr. Stephen) mentioned lone parents. I shall quote to him some facts and figures on lone parents. Three in five lone-parent families, compared with one fifth of couples with children, live in poverty. Seventy per cent. of lone parents receive income support–1 million lone parents in all. Nearly all lone parents would like to have a paid job at some point, and 55 per cent. would do so sooner if child care was available. Instead of castigating lone parents, the Government should do something to help them. They have the power and position to do that. It is time that they got off the backs of lone parents and gave them some assistance.
I heard the Secretary of State reply to the hon. Member for Billericay (Mrs. Gorman). It was the old theme of "on yer bike" to look for a job. The hon. Lady said that people must get up and go. What absolute nonsense. The Secretary of State agreed. He said, "If you get up and go, you will get a job." I live in an area which has suffered unemployment. The local factory, which employed nearly 7,500 folk at one time, has shut. I am not saying that we are devastated—we are too proud to be devastated and we have talent—but we must get access to the finance markets. We must have access to something which gives us life. Many folk who worked in our factories are dead and buried, but their families live in the area. They have no job and no income. They rely on the state. It is nonsense to tell them and people in other parts of Scotland to get up and look for a job when nearly 300 to 400 kids chase one job and nearly 4,000 folk chase one job.
The Secretary of State agrees that people should get up and go. I have always believed in people getting up and going, but there are some folk who cannot possibly get up and go for the job market that the Government have made unavailable to them. In Strathclyde alone, we have lost 50 per cent. of our manufacturing jobs. If we do not have producers, we will have nothing. If there is wholesale slaughter of companies, manufacturers and industry, how will Britain get out of the pit? It will not get out of the pit with the Government. They have no vision to get Britain working again. We provide work 878 only by producing and selling goods. The Government have no intention of doing that. They keep trying to shift us into the services market.
A taxi driver in my constituency drove me to the airport today. He told me about his wife who had a job. Do you know what the job paid, Madam Deputy Speaker? It paid £2 an hour. She was making sweets. I know the company for which she worked. I can take you there any day, Madam Deputy Speaker, and show you people swanning about, guzzling champagne and stuffing themselves with steak, when that wee woman will be lucky to have a bit of cheese and some milk while her husband struggles as a taxi driver. Get up and go—would you get up and go for £2 an hour, Minister? Would his family work for £2 an hour? That is the Minister getting up and going. I am in favour of getting up and going. The Government should provide a minimum wage for workers such as that woman. She wants to work, but not for £2 an hour. She wants to bring her money to help to put bread on the table and put food in her family's belly. Two pounds an hour will not go very far, Minister. Is that the society that you want to create? I could go further.
I now refer to the iniquitous extension of VAT on fuel to pensioners. Obviously, I know that there are pensioners who have a few quid, but I meet pensioners all the time in my constituency, and I ask them what they had for breakfast, dinner and for what we call tea. It is shocking to hear of the poverty of people in Scotland. I know that that happens all over Britain. When they are told that the Common Market will give us a wee free handout of milk, eggs, butter, cheese and a can of mince, they say to me, "Will it come here, Tommy? It was good the last time." That breaks my heart. Their husbands fought for this country and probably saved it from slavery and fascism, but they now live in poverty that was created by a cringing creature of a Government who are not looking after our people at all. There is too much poverty, yet the Minister says that there is none. I have lived in poverty; I have been unemployed and I know what it is like.
I know what it is like to sweat because the electricity bill is coming in, and to sweat when I see that my son has holes in his shoes, because my wife or I will have to find the money to buy him new ones. I know what it is like when there is no job available; I have suffered that indignity. I was a fully qualified engineer, but there was no work. I have an older brother who worked for 37 years and had never been unemployed before. He is a design draughtsman, yet he cannot get a job. He is trying everything—further education, the lot—but there is no job for him. I have another brother who suffered unemployment for a long time until he got a job.
Does the Minister realise what problems that creates in households? Last week in my surgery a woman was breaking her heart because her house had been repossessed and she was desperate to be housed. She and her husband had split up. I asked her what she had done with her money, and apparently her husband worked in a shop, but because of the economic depression and the lack of money in the community his hours were cut and therefore so were his wages.
Then the man was ill with a stomach problem and his wife spent the money on dietary requirements, which were not subsidised by the national health service. She had put the money in to try to keep her man well, and at the end of the day the mortgage did not get paid and they lost their house. Now they are out of the house and have been 879 split up, so there is a huge problem. The man is still in a low-paid job and has been separated from his wife and child because they cannot live in their home and are having to sleep in other people's homes. That is what poverty is, Minister.
It is all right for the wealthy folk who have a few bob, such as the folk here. When people earn 06,000 a year they can put their hands into their pockets and buy their way out of any trouble. Our folk cannot buy themselves out of trouble. They cannot find the jobs to earn the wages to buy what they need. I shall give one more example. I tell you, Minister—
§ Madam Deputy Speaker
Order. Will the hon. Gentleman tell me, rather than telling the Minister directly?
§ Mr. Graham
I apologise, Madam Deputy Speaker.
Poor diet causes obesity, tooth decay and loss, anaemia, rickets, coronary heart disease, strokes and cancers. I believe that the worst cancer that Britain has had for the past 16 years is the Government. Only through a general election will we able sensibly to get Britain back to work and enable people to earn a wage so that they will not have to live off the state. There are many jobs that need doing in this country. The roads are falling apart, and so are the schools. We need new schools and hospitals, and we need care and attention. I say to the Minister, "Get our folk back to work, and we shall not need to pay so much money to keep folk out of work."
§ 9.1 pm
§ Lady Olga Maitland (Sutton and Cheam)
As the debate is based on the Joseph Rowntree Foundation's inquiry into income and wealth, I thought that I would devote a few moments to some observations about that foundation as a whole. I entirely endorse what the Secretary of State said at the beginning of the debate when he pointed out what a left-wing bias the foundation has.
I should have more confidence in the Joseph Rowntree Foundation's reports if there were any recognisable right-wing figures among the trustees. Sadly, such people are missing. The foundation will sponsor any number of inquiries into topics dear to its heart, but I should like to see it accept a few propositions put to it by right-wing organisations. Why, for example, did it not examine a paper about the breakdown of the family, or an analysis of family responsibilities? Or am I asking too much?
I find the report emotive and biased; the foundation is damned if it can recognise good news and it relishes bad news. The report makes the simple claim that the poor have got poorer since 1979, but does not back that up with any hard facts. It is based on figures from the Government publication, "Households Below Average Income", which contains information collected on the basis of samples designed to provide illustrations of spending rather than on the basis of numerically sound income statistics.
The report is therefore impressionistic, and gives no proof of widespread impoverishment. No allowance is made for the black economy and the report cannot explain why even the very poorest in the bottom tenth of society now have access to a video recorder. It does not distinguish between different types of the poor. For example, there are many more students today than there were in 1979, thanks to the Government's policy of pushing up standards in schools and getting young people 880 into further and higher education. Grants have, of course, become more strictly controlled, but a temporary lack of funds does not make students a social problem. After all, students—by virtue of their education—are likely to achieve reasonable prosperity.
The report makes false assumptions that the very poorest are always the same downtrodden group. That is not so. Some people who were very poor in 1979 are not poor today; I refer particularly to pensioners who, because of higher state pensions and better occupational pensions, have to a large extent improved their position.
We should look at groups that are held in the benefit trap. Fifteen years ago, 600,000 people collected invalidity benefit. Today 1.6 million people do so. Is there really so much more long-term illness and injury about, or has a culture grown in which living off the state's money is normal and acceptable?
The same question must be asked about another group—the single, never-married mothers. They make up a significant group, and are bereft of support from the fathers of their children. Those absent and feckless fathers are rightly chased to support the children by the Child Support Agency. The group is interesting because the problems of poverty caused by single parenthood are often of the parents' own making. I have yet to see any mother in the never-married category who has given any thought to planning a structure for her life when mothering a child. What discussions has she ever had about commitment with the father of her child? Nobody can blame the Government for the breakdown of a relationship between a man and a woman.
I welcome the remarks of the Archbishop of York, Dr. Habgood, who is suggesting that he would support a tax devised to make marriage more attractive, which would thereby bring children within the family circle of parental commitment—above all, the father's commitment—to the family good. I can say only that children always do far better when there are two parents rather than one.
Let us look at the definition of poverty. The goalposts have moved so significantly that we take comforts for granted today, which we would never have taken for granted 10 or more years ago. Even the one tenth of society at the bottom level have improved their living standards. For example, in 1979, 47 per cent. of people had a telephone, while today the figure is 68 per cent. In 1979, 42 per cent. had central heating. Today, the figure is 70 per cent. When one starts looking at those basic goalposts of poverty to see how things have changed, one understands that the debate has gone off on completely the wrong tack.
I draw the House's attention to a story in the Daily Mail, which states that the Watters family legitimately claim £18,000 a year in social security handouts. On top of that, they went on a spending spree with almost £7,000 extra that was wrongly sent to them by the Department of Social Security, which is not claiming the money back. The Watters family spent the money on Christmas gifts, including £1,000 on mountain bikes for their children. Some £600 went on a fitted kitchen and new furniture, while £2,000 was spent on a Montego car.
The Watters family have admittedly been hit by ill-health. Both parents are on disability living allowances, and one of their five children has a groggy knee. But it must be said that while they are unlucky in health, they are fortunate in welfare. Are the poor getting poorer under the Tories, as the Rowntree foundation insists? Ask the 881 Watters family, and they will tell another story. Indeed, hard-working taxpayers who heard that story today may be forgiven for wondering whether we have lost our plain common sense. The truth is that that family are a symptom of how far we have gone in generous social benefits and show clearly how the goalposts of poverty have moved.
In the short time remaining, I shall cite another example of how the definition of poverty has become unreal. The case of Paul and Georgina Stokes was reported in The Daily Telegraph. They provide a good home for their three obviously happy children. Mr. Stokes is a computer technician, who lives with his family on an estate in south-east London on a disposable income of £156.60 a week which, in the view of the Child Poverty Action Group, puts them on the poverty line.
Let us consider the family's life style. Admittedly, their flat is cramped, but it is warm. The children are well cared for. There is no denying that it is not easy to meet costs each week—it takes planning. After the bills are paid, the couple say that they are lucky if they have £20 or £30 a month for luxuries. Neither drinks or smokes and a luxury might be a Chinese meal once in a while. Mr. Stokes has a car, although it is in his father's garage at present as he cannot afford the running costs, and meanwhile he goes to work on a small motor cycle.
Last year, life improved sharply for Mr. Stokes when, having been unemployed for two years, he went on a Government retraining scheme and thence into a job. Although he is still reckoned to be on the poverty line, today his children are well clothed and have toys and Pinky, the cat. Using catalogues and hire purchase, the family can afford a stereo system, colour television, fridge, freezer, washing machine and microwave.
Over and above all that, this Conservative Government have given that family the peace of mind of knowing that the children will grow up certain of a real education—an education with standards, which will get them into further and higher education, to university and into professional life. They have the peace of mind of knowing that they need never worry about hospital bills, unlike families in other countries in the developed world.
In view of the very prosperous conditions that this Conservative Government have given all the people, this debate on poverty should be revised.
§ Mr. Bill Etherington (Sunderland, North)
One thing is certain—the contribution of the hon. Member for Sutton and Cheam (Lady Olga Maitland) was a good example of impoverishment of thought, vision and compassion.
I must also take the Secretary of State for Social Security to task on part of his statement, in which he quoted the percentages of families who have fridge-freezers, washing machines, cars and television sets. He reminds me of the prerequisite for a cynic:A man who knows the price of everything and the value of nothing.The Secretary of State certainly demonstrated that in that part of his speech.
If the Secretary of State had wanted to deal with people who are really affected by poverty or impoverishment, he would have considered those who do not have good 882 housing or eat well and whose children do not have the best education facilities because of the area in which they live. Those people do not have good transport and cannot afford holidays.
Despite the roseate glow that the hon. Member for Sutton and Cheam painted on society, my experience of life with my constituents does not fit in with her philosophy. There are various types of inequality—inequality between people and groups and, perhaps most important, inequality between regions. I speak for a constituency that is the 63rd most impoverished out of 623. All life within the constituency is based on that fact. The inequalities are a result of deliberate Government policy. It is no good the Government saying that they are accidental and that the trickle-down effect does not work.
Nothing new has come out of the Rowntree report. The truth has probably been obvious for the past seven or eight years to anyone who has been prepared to read about those things, although it has not been put quite as starkly as it is in the report.
My hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) mentioned that deprivation brings about bad health. That does not appear to cause too much concern to the Government, judging from the way in which they treat the health service. A study that was carried out—albeit about two years ago—by the university of Bristol, said that, in the north-east, Easington, which is adjacent to my constituency, and Sunderland were two of the bottom five districts for bad long-term health. That proves that the 15 years of Conservative Government have been a failure for the health of the people in my constituency, and in the region in general.
Government policy has guaranteed that we shall get low pay in large amounts. The legislative thrust has been for the weakening of trade unions and the abolition of wages councils. The Government's various economic policies have ensured that there has always been a large number of unemployed people, to be used as a threat to other people who were in low-paid employment and therefore would not be in a position to better their conditions.
It is coincidental that New Zealand was quoted as having a record of disparity of distribution of wealth similar to that of this country. That does not surprise me, because I was talking recently to a chap whom I went to school with—[Interruption.] If the Secretary of State would like to intervene, I am willing to sit down.
§ Mr. Etherington
I accept that, but it certainly does not apply to the 15 years of misery that we have had in this country. The Secretary of State might like to reflect on that.
Hardly a week goes by without the introduction of a piece of legislation that disadvantages unemployed or sick people or, in some cases, both. Since Christmas, we have had the Jobseekers Bill and legislation to prevent the payment of mortgage interest for unemployed people. Legislation has also been introduced to make things worse for people who are suffering on invalidity benefit. Perhaps worst of all, we have had the Government's revenue support grant estimates, which have decimated the services that local councils can provide, most of which are of benefit to the poor. If one is wealthy, one is not too 883 worried if the citizens advice bureaux close or if there are no welfare benefits officers, but if one is poor, that can be one's lifeline to try to bring about a little bit of improvement in one's life.
It has been shown beyond doubt under the current Government that, every time that there has been a boom, the wealthy have benefited, and every time that we have had a recession, the poor have paid. It is no surprise, therefore, that the gap is opening up between the wealthy and the poor. It is intentional. It is an indictment against the Government and, if they had had anything about them, they would have done something about it many years ago. It may well be that, with the coming general election, the Government might start to show a little bit of compassion, purely to win votes, which is about the measure of them.
The tax policies that have been carried out have exacerbated the gulf. Every tax policy that has been introduced by the Government, which has helped to direct tax away from direct taxation to indirect taxation, is a bigger burden on the poor and less of a burden on the well-off.
I shall finish, because I know that time is short and I promised that I would wind up by 9.20 pm. The Secretary of State mentioned the back-to-work bonus three times. I cannot help being slightly cynical about that, because it reminds me of the story that I once read in which there was a crock of gold at the end of the rainbow. The problem is that the Secretary of State does not recognise that most people are busy trying to find the rainbow, and there is no chance of their finding the crock of gold until they find the rainbow.
I am pleased that we are now receiving more publicity for the results of the dreadful policies pursued for many years by this deplorable Conservative Government. The sooner that we have a general election to get rid of the present Government, the better.
The Government have made the mistake of assuming that economic success will lead to a successful society. They have not learnt the lessons that everyone should have learnt from the failures of the Webb policies. I am pleased that my hon. Friends on our Front Bench are listening attentively. It will not be enough to get rid of unemployment and get the economy moving a bit better. Something radical must be done about a proper redistribution of wealth, to get rid of the comparative poverty that is becoming worse daily.
§ Ms Harriet Harman (Peckham)
This debate has shown clearly that the Tory Government have presided over growing divisions. But it has also shown that they are not prepared to address the problems that they have helped to create. So we have a divided Tory party, a divided Cabinet and now a divided nation.
The Joseph Rowntree Foundation report highlighted two principal causes of the growing divide: long-term unemployment and low pay. The Tory Government will act on neither, because they are locked into the ideology that wealth will trickle down from a privileged elite to the rest of Britain, that inequality is essential for economic efficiency, and that the free market and deregulation will ensure prosperity for all.
It has been made clear in this debate that making the rich richer has not made the poor better off. The Government cannot deal with poverty and inequality by 884 waiting for wealth to trickle down. They must take action to attack poverty and inequality at their source, which must mean dealing with long-term unemployment and low pay.
Not only are the Tories a divided party with a divided Cabinet presiding over a divided nation, but some of them seem to be divided even in their own minds. For instance, the Secretary of State for Social Security clearly has two voices inside his head. The one we heard tonight tells him that everything is fine, but the other tells him that the earnings gap is growing. In a speech that he made in Ulster, which was very different from what he told the House tonight, he said:Over the last couple of decades, although average earnings have grown strongly, the differentials have widened.This widening of earnings differentials lies behind or is intertwined with many of our social problems … the break up of families, the growth of lone parenthood and a growing welfare dependency.He went on:It may even play a part in explaining delinquency and crime".Outside this House, he can accept the facts of growing inequality and recognise the social and economic consequences of growing inequality, but he will do nothing about them, because the Tories are locked into an ideology which, even where it does not prevent them from observing the problems, prevents them from doing anything about them.
The divisions were spelt out in the Joseph Rowntree Foundation's chilling report. Those problems demand action. Those on low pay struggle to survive, working harder and harder just to stand still. The experience of millions of families is summed up by the words of a man to whom I spoke in Islwyn:We feel like we are running up the down escalator … every time we try and get ahead … we are pulled back downor the woman in my constituency of Peckham, who said:My husband works all hours that God sends … he's always exhausted but we've still got no money at the end of the month.Does the Minister accept that low pay is a problem for those people?
Low pay is a problem for people trapped on benefit who cannot go out to work, because the only job that they could get would make them worse off than if they stayed on benefit. It is also a problem for the public purse. As my hon. Friend the Member for Rotherham (Mr. MacShane) said, employers who pay low wages leave the taxpayer to pick up the bill in family credit and housing benefit.
I challenge the Minister to admit, when he winds up the debate, that, according to his figures, 75,000 people receive less than £1.50 after an hour's work. I shall give way to him if he will seek to justify the fact that, in this country and this day and age, people work for £1.50 an hour or less.
§ Mr. Oppenheim
The hon. Lady should bear it in mind that, although the £2 a hour she quotes is low, only four workers in 1,000 get paid less than £2.90 a hour. We would all like people to be paid more, but it has to be sustainable and based on the productivity and efficiency of the economy. Unfortunately, just to impose a minimum wage by political diktat would merely replace low pay with no pay for hundreds of thousands of people.
§ Ms Harman
I was expecting the Secretary of State to get up and ask that. [HON. MEMBERS: "Answer the question."] If hon. Members will get back into their prams for a moment, I shall reply.
The difference between us and the Conservatives is not that we want one level of minimum wage and they want another, but that we consider that low pay is a disgrace, and that there should be a floor under wages.
When Ministers tell us what the level of national insurance will be after the next election, if they win it, or the level of taxes or other benefits, it will be reasonable for them to ask us what the minimum wage would be. It is a sign of their desperation that the only way to avoid justifying their figures and their appalling record is to continue asking us questions that we have said we will decide at the time of the next election.
Low pay is a problem, and it is getting worse. There are now more people on low pay than there were in 1980. While the gap between the low-paid and the rest has been getting smaller in many other European countries, here in Britain the gap between the low-paid and the rest has been growing.
§ Mr. Alan Howarth
I am grateful to the hon. Lady, and I agree with her that low pay carries with it enormous problems for households and for the public purse. If she believes that there is a minimum wage that in principle would be high enough to alleviate poverty satisfactorily and to attract people into work who at the moment are discouraged from working, but not so high that it would discourage employers from offering jobs, I do not ask her to tell me what it is, let alone what it will be when the next general election comes, but on what principles and by what methodology she would establish what it should be.
§ Ms Harman
We see the minimum wage as part of our welfare-to-work strategy, so that there is a floor under wages and the in-work benefits are used to top up wages as an incentive for people to go from benefits into work, whereas at present in-work benefits are being used to top up the bottomless pit of low wages.
Of course it is possible to have a floor under wages, and it has been done in every other country. Britain is the odd one out. Other countries have been able to have a minimum wage, and better records of job creation.
The Government are against a minimum wage, because they do not care about low pay, and they are crying crocodile tears when they say that they are worried about the effects of low pay. While we condemn the growing divide, the Tories excuse it. Sir Iain Valiance, the chairman of British Telecom, earns at least £180 a hour, following the privatisation of BT, while a security guard in Rotherham earns £1.80. [HON. MEMBERS: "So what?"] Conservative Members say, "So what?", but they always excuse top pay and perks. They never condemn them or act to stop them. They are always on the side of privilege and never on the side of people.
886 As for young people at work, there is no evidence that the low pay they receive will improve as they get older. They are stuck in a low-skill, low-pay trap with no prospects.
Professor Patrick Minford, spokesman for the Tory right, was on the radio again this morning. He was echoed by the hon. Member for Finchley (Mr. Booth), who spoke earlier in the debate. Professor Minford said that inequality does not matter—[HON. MEMBERS: "Hear, hear."]—and Government Members agree. According to Professor Minford, all that matters is keeping people out of absolute poverty and deprivation. But that is not all that matters. Society must work together so that everyone has a stake in the future and is part of future economic prosperity.
My hon. Friend the Member for Birkenhead (Mr. Field) made that point very powerfully, using the analogy of society as a moving train. He said that the fourth carriage has become unhitched from the rest of the train and is being left behind. Society is not working if thousands of people face only worsening prospects while others are better off. As my hon. Friend the Member for Bristol, East (Ms Corston) showed in her forensic dissection of the Government's figures, absolute poverty matters as much as relative poverty. The plight of the poorest 10 per cent. of the population is worsening.
Professor Minford and Government Members ask why we are against huge pay rises and perks. Professor Minford says, "Why not reward success?" He says that we should reward those who bring joy into our homes. But the directors of privatised utilities do not bring joy into our homes. What is he talking about? As the constituents of my hon. Friend the Member for Southampton, Itchen (Mr. Denham) recognise, their only achievement is to award themselves millions of pounds in pay and perks, while telling those who work for them that they have to "act responsibly" and see their pay fall or lose their jobs.
We believe that there must be fair taxation. Why should company directors receive thousands of pounds by way of executive share options, while everyone else pays more tax? Huge pay and perks are not about rewarding for success; they are about some getting super-rich on the backs of everyone else.
The Tories say that low pay will cure unemployment. We say that low pay and unemployment go hand in hand. In the poorer areas of this country, we see low pay and unemployment—the twin symptoms of Tory economic failure. Every month, the Tories greet the headline claimant count unemployment figures with a blanket of complacency, They say that things are looking up, and that unemployment is no longer a problem. They accuse Labour of simply talking the country down. [HON. MEMBERS: "Who says that?"] Government Members say that—those opposite obviously have worse cognitive dissidence problems than we thought.
Every time that Ministers tell the people of this country that everything is all right—as they have done tonight—they confirm people's absolute certainty that the Government are out of touch and do not care. They reinforce people's sense of despair.
Unemployment remains a major problem—it is a problem for those who are locked out of the labour market, and it is also a problem for those who are in work.
887 They feel insecure, and they worry that each pay cheque might be their last. Of course unemployment is worse than the claimant count describes.
There are pockets of structural unemployment. My hon. Friend the Member for Barrow and Furness (Mr. Hutton) spoke about the problems of unemployment in his constituency. One in three people on Merseyside are unemployed, and two out of every three young black men in London are unemployed. It is no good telling those people to wait until the economy grows, and then the benefits will reach them. They will not. Structural unemployment must be addressed by specific measures.
For example, the Government should establish a national child-care strategy for single parents who want to go out to work instead of bringing up their children on benefit. As my hon. Friend the Member for Renfrew, West and Inverclyde (Mr. Graham) said, there is a simple choice: the Government can provide child care or pay the income support bill for women who cannot go out to work, and who are condemned to bring up their children on the breadline.
To deal with unemployment, the Government must also act on the lack of skills among the unemployed. What a joke that the Government say in their amendment to our motion that they are improving skills in this country. They have failed on youth training. The figures show that it is not working, as my hon. Friend the Member for Bow and Poplar (Ms Gordon) said. They are also cutting training. They have cut the number of places on the training for work scheme by 55,000. They fail to understand the strong connection between long-term unemployment and inability to get a job.
People with low skills or no skills are the first to lose their jobs, and they take the longest to find a job. That is why it is a particular disgrace that the Government have cut down on the 21-hour rule. Instead of extending the hours that one can study before benefit is cut for an unemployed person, they are reducing them. One can now study for no more than 16 hours before one's benefit is cut.
That is throwing an obstacle in the path of people who want to study, to improve their skills and qualifications and improve their chances of getting back to work. As my hon. Friend the Member for Sheffield, Hillsborough (Mrs. Jackson) said tonight, it is a kick in the teeth for people who want to get skills and want to get on.
Of course international factors such as global competition and technological change have affected the labour market, but the Government could do one of three things: nothing, make things better and ameliorate the problems, or do what they have done—make things worse. They stand guilty of failing to act on unemployment. Unemployment is not a price worth paying. It is a problem not just for the unemployed but for the whole community. It is also a problem for the public purse.
In the face of that, however, the Conservatives have resorted to their instinct to blame the victim. The single effect of the jobseeker's allowance is that it will make the unemployed poorer. It will produce not one extra job. Not one person will find work as a result of it. It will simply make people worse off.
What question do the Government now seek to ask the unemployed when they go to claim benefit? What 888 question is in the forefront of the Government's mind? The booklet that will be given to unemployed people—they will be asked to fill it in—asks:What is the lowest wage you are willing to work for?That is the question that the Government choose to ask the unemployed. Of course, they had better give the right answer, or they will get no benefit at all. There is a clear message in that question: there is now no bottom line; whatever an employer is prepared to offer is what one must be prepared to accept.
I ask the Minister to tell us tonight: what is the amount that one can put in that box without losing one's benefit? What is the bottom line? That is a question that he is asking unemployed people. He should be prepared to answer in the House tonight. Of course, there is only one point in asking that question. It is a green light for employers to offer lower and lower wages, and the public will be left to foot the bill, because if employers do not pay the wages, the taxpayer will have to pay—in family credit, housing benefit and council tax benefit.
No doubt the Government will say, as they always do, that all Labour proposals mean extra public spending, but let me remind Ministers that they promised to cut public spending, but they did not. Instead, they spend more and more on the consequences of economic failure: unemployment, crime and poverty. They have spent less and less as a percentage of our national wealth on the things that would bring economic and social renewal, the things that are investing in the future. The Government have not cut public spending: they have spent more and more on mopping up the consequences of their own economic and social failure.
Howard Davies, the director of the CBI, said:At present, far too much of our public spending is devoted to compensating for the effects of failure, rather than investing in the ingredients of success.Of course, low pay is a growing problem for the public purse as well. Family credit has become a subsidy for low pay rather than help for large families. As the hon. Member for Stratford-on-Avon (Mr. Howarth) pointed out, its cost has more than doubled in just four years, and that cost will double again. The Government are topping up what is turning out to be a bottomless pit of low pay. They are turning a blind eye to low pay and making the taxpayers pick up the bill, and the taxpayers will not stand for it.
We firmly believe in a welfare-to-work strategy that uses the benefit system as an incentive to put people into work rather than paying them to stay out of work, but the public purse cannot go on topping up low pay indefinitely. There must be a floor under wages: there must be a national minimum wage. The failure of Tory economic and social policy has scarred millions of people, destroying communities and holding Britain back.
People in this country do not want to see growing divisions, rising crime and the poverty and alienation that come with a divided Britain. They do not want to see their taxes constantly mopping up the consequences of the Government's failure, never building for the future. People in this country want a nation at work, not a nation on benefits; they want a nation of people working together, not growing apart. That is why we tabled the motion, and we shall vote for it tonight.
§ The Parliamentary Under-Secretary of State for Employment (Mr. Phillip Oppenheim)
I am grateful for the chance to reply to today's debate. I listened carefully to nearly all the speeches—I was sorry to miss one or two—and particularly enjoyed that by my hon. Friend the Member for Teignbridge (Mr. Nicholls), which I thought extremely thought provoking. I also enjoyed the speech by my hon. Friend the Member for Aylesbury (Mr. Lidington), which dealt very effectively with the flaws in many parts of the Rowntree report, and especially effectively with the issue of trade.
I was interested by what was said by my hon. Friend the Member for Twickenham (Mr. Jessel), who was particularly enlightening about the relationship between vegetable consumption and the birth rate. My hon. Friend the Member for Hertsmere (Mr. Clappison) also made a number of good points. I hope that the hon. Member for Birkenhead (Mr. Field) will forgive me if I say that, although I did not agree with everything in his speech, I thought it balanced. I think that most Conservative Members enjoyed it and found it enlightening.
I particularly welcome the opportunity to debate the key issue of the relationship between unemployment and poverty. The debate has shown the complexity of the issues involved in any sensible discussion of the subject. It is, I think, fair to say that all of us—regardless of party—would like to see the incomes and living standards of all our people rise. Later in my speech I shall examine the Government's policies in that regard—and, of course, the Opposition's—but, first, I shall dwell briefly on the Rowntree report, which has been widely quoted and occasionally even misquoted. Like most good reports, it rewards careful reading.
One of the less well-reported aspects of the study is the fact that, in 1979, of the bottom 10 per cent. of the population, one third were pensioners, compared to only 12 per cent. now. Since 1979, average pensioner incomes have increased faster than those of the remaining households—a point that was made very effectively by my hon. Friend the Member for Hertsmere. Perhaps Opposition Members should also examine more closely the passage and graph relating to the growth of income inequality: it is interesting, because it shows that the growth in inequality began not in 1979 but in 1976, fully three years before Mrs. Thatcher came to power.
We have heard much today about the growth in poverty, which was mentioned by the hon. Members for Bow and Poplar (Ms Gordon) and for Rotherham (Mr. MacShane). It is worth pointing out that the basis for the claim that poverty has grown is the so-called European decency threshold—three words that probably cause tremors in the spines of most of my hon. Friends; they are pretty bad individually, but together they are devastating. The threshold was introduced in 1977, and currently assesses the poverty line for Britain at nearly £12,000 a year. That level of income would not be recognised as poverty by most people. That is why no European Government have accepted the definition, and why the previous Labour Government did not accept it when it was introduced in 1977.
§ Mr. Oppenheim
I hope that the hon. Gentleman will let me get on for a minute and then I shall let him intervene.
890 The report talks about the polarisation between households with two earners and other households, but it also shows that participation in the labour market by women from low-income households has been catching up with participation by those from high-income households, and that women's pay is now closer to men's pay than at any time in our history.
One important facet of the Rowntree report, however, should, and does, concern all hon. Members. It rightly points out that the growth of unemployment is one of the main causes of poverty. We must not duck that issue. If I were in opposition, however, I would not take too much comfort from that, as people have not forgotten that the Labour Government doubled unemployment in the five years they were in power. Unemployment rose at a faster rate between 1974 and 1979 than it has since 1979. The Labour Government's record on unemployment was worse than that of the European Community as a whole, whereas now we are doing considerably better.
§ Ms Harman
Does the hon. Gentleman recognise that unemployment is still almost 1 million higher than it has ever been under any post-war Labour Government, that long-term unemployment remains at almost 1 million and that the United Kingdom is the only Group of Seven country that has had no rise in employment since 1979? In short, will he start telling the truth, instead of just covering the argument with lies?
§ Mr. Oppenheim
I thought that the hon. Lady had made her speech earlier. She should recognise that, when the Labour party was in power, Britain's record on unemployment was significantly worse than that of the European Community as a whole, whereas now we are doing better.
I would be the first to admit that unemployment is still far too high in Britain, as it was when the Labour party was in power; but let us not forget that, if some panacea existed for the problem, which afflicts almost the whole of the industrialised west, France and Italy would not be suffering from unemployment rates of close to 12 per cent., nearly a third higher than in Britain.
Equally important, Britain has not only fewer people out of work, but far more people in work. In Britain, more than two in three of the adult population—
§ Mr. Oppenheim
I shall make a deal with the hon. Gentleman: if he will sit down for a few minutes and stop making those animal noises, I shall do my best, if he sits still—
§ Mr. Graham
On a point of order, Mr. Deputy Speaker. I have not made any animal noises. That is an insult.
§ Mr. Oppenheim
If the hon. Gentleman relaxes for a minute or two, I shall give way to him in a minute.
In Britain, more than two in three of our adult population are in work—a higher figure than in Germany and far higher than in Italy or France. The figure is 891 certainly far higher than the figure in socialist Spain, with its highly regulated labour market and national minimum wage, where less than half the population are in work, and where nearly a quarter are unemployed.
§ Mr. MacShane
I am grateful to the Minister, to whom I gave way twice for very lengthy interventions. The pontificator maximus has arrived—wonderful, here he is. No Opposition Member mentioned the European decency level. We are Europeans and he is not very decent. but I suggest that he make his speech in Rotherham, and that he tell the people there that no poverty exists and that unemployment is not a problem—[Interruption.]
§ Mr. Oppenheim
I thank the hon. Member for Rotherham for his intervention. He was good enough to give way to me twice in his half-hour speech and I appreciated that.
The only way we shall create more secure, high-quality jobs for all our people is if our economy is a success. Whereas in the 1960s and 1970s we were consistently bottom or near the bottom of the league of major industrial countries on growth in manufacturing productivity, industrial output, inflation and manufacturing output, in the 1980s—and since then—we have been at least as good as the G7 average and, in the case of manufacturing productivity growth, as good as the best. That is why, while productivity and real pay stagnated at all levels from 1974 to 1979, the massive rise in productivity since 1979 has allowed for a large rise in real take-home pay at all levels.
A single man in the bottom 10 per cent. of earnings has seen a real increase of 23 per cent. in his take-home pay since 1979; the same person would have seen a fall of 1 per cent. under the previous Labour Government. Under Labour, the rich got poorer, but the poor did not get any richer.
§ Mr. Oppenheim
That is not a description that my hon. Friends would recognise.
Anyone who pretends that there is an easy, painless panacea is perpetrating a cynical con on the less well-off. This seems to be a good point at which to examine the Opposition's policies. How would they help the unemployed and reduce poverty? They have a policy—it is called the minimum wage. We know that because, on 5 January, the hon. Member for Peckham (Ms Harman) proudly trumpeted it in a letter to Labour group leaders. Unfortunately, she cannot tell us at what level Labour would introduce the minimum wage, whether there would be different levels for young workers and trainees or what it would do about differentials. If the hon. Lady is now going to enlighten the House, I shall gladly give way.
§ Mr. Oppenheim
I shall give the hon. Lady the answer. The answer is that people will not have to accept 892 wages any lower than they had in their previous job. I have answered the hon. Lady's question; will she now answer mine? I see that she is not prepared to do so.
§ Mr. Oppenheim
Although I have answered the hon. Lady's question, she will not answer mine.
Let us see what other Labour supporters have to say about the minimum wage. Baroness Castle backed a report which concluded that the higher the minimum wage, the greater the increase in unemployment, which is why she did not introduce one. John Grant wrote recently in The Guardian that it was a "pious hope" to expect better-paid workers not to want to maintain differentials—and he was the low-pay Minister under the previous Labour Government.
Only a few months ago, Lord Healey said:Don't kid yourselves—the minimum wage is something on which unions will build differentials … therefore the minimum wage becomes a floor on which you erect a new tower".The deputy leader of the Labour party said:A minimum wage would cost jobs—any fool knows that".Well, apparently, only some fools have groped their way to that enlightenment. At least the deputy leader of the Labour party has spelled out his economic policy, which is:Society should tolerate relative inefficiency in labour intensive sectors".In other words, local authorities should be able to employ more low-skilled staff.
Let us briefly refresh our memories about the performance of those local Labour authorities, which will play such a large part in Labour's job creation plans, with the words of Mr. Leo McKinstry, who was the political researcher of the hon. Member for Peckham and a former Labour councillor. He said:I could see only too clearly the spirit of Labour in local government—that mean-minded cocktail of political correctness, bureaucracy, intervention and abuse of public money—pervaded the whole party".Let us add that to the shadow Chancellor's pronouncements:Our new economic approach … is rooted in the world of economic ideas, ideas which stress the growing importance … and the growth of post neo-classical endogenous growth theory and symbiotic relationships.There we have a crystal-clear vision of where Labour wants Britain to go. The deputy leader wants a nation of low-skilled public corporation workers and the shadow Chancellor—well, no one is quite sure what he wants.
I quite understand that Labour would prefer to be coy about its policies. It says that it wants a minimum wage, but can tell us nothing about the level or differentials. It says that it wants to clobber the high-paid, but cannot tell us to what level it would raise the top rate of tax. It seems enamoured of the Rowntree report, but cannot tell us how many of that report's 20 recommendations it would implement and what it would cost.
§ Mr. Oppenheim
I am told that there is a Labour party publication entitled "Women Today", which recently held a competition which said:Win a day in Parliament. All you have to do is say in no more than 100 words what the policies and priorities of a Labour Government would be.We will just have to wait until those good ladies have returned their answers before we can have some clear Labour policy.
§ Mr. Oppenheim
In the meantime, let us refresh our memory about the Labour Government's record on equality and fairness. Under Labour, while real earnings for the majority stagnated, one group did very well indeed.
§ Mr. Oppenheim
I am not sure what a fearty is, Mr. Deputy Speaker. Is it a parliamentary expression or not? I seek your guidance.
One group did very well under the last Labour Government—those able to exploit their industrial muscle to secure the largest possible pay increases, while weaker groups, such as pensioners, looked on helplessly as the resulting inflationary binge destroyed their savings.
Let us not forget that, in the 1970s, pensioners formed a far higher proportion of the bottom 10 per cent. of households than they now do, and although two thirds of unemployed people now get a job within six months and can move out of that bottom group, once those pensioners, under Labour, were in that bottom 10 per cent., they were stuck there, watching doomed as Labour's policies ate into their life savings.
We all agree that unemployment is one of the main problems that we face. Regardless of party, we all want to see people enjoying a better standard of living. The question is how to achieve that. We say improve training, boost productivity, so that employers can afford to pay people more on a sustainable basis. Labour says put up wages regardless of productivity. That would simply replace low pay with no pay. Since our economy is so much more productive now than it was in 1979, real pay has risen at all levels in contrast to the record under Labour, when both pay and productivity stagnated. That was the time when Britain risked becoming a low-wage skivvy economy—not under this Government, but under the last Labour Government.
We have heard a great deal of loose talk from Labour Members and there has been much use of the word "obscenity". I shall tell the House what is obscene. It is obscene for politicians to pretend to the less well-off that there is some easy, painless route to higher pay. It is obscene for the Opposition to have spent three years since the last election without telling people at what level they would introduce the minimum wage, what they would do about differentials and whether they would have a differential rate for young workers or for trainees. It is obscene for the Opposition to pretend that the minimum wage in other countries, such as the Netherlands, Belgium and France, has not resulted in unemployment levels that are two or three times the UK level. It is obscene for them 894 to deny that a minimum wage would cost jobs. I urge the House to support the Government amendment.
§ Question put, That the original words stand part of the Question:—
§ The House divided: Ayes 252, Noes 291.897
|Division No. 72]||[9.58 pm|
|Abbott, Ms Diane||Dobson, Frank|
|Ainger, Nick||Dowd, Jim|
|Ainsworth, Robert (Cov'try NE)||Dunnachie, Jimmy|
|Allen, Graham||Dunwoody, Mrs Gwyneth|
|Alton, David||Eagle, Ms Angela|
|Anderson, Donald (Swansea E)||Eastham, Ken|
|Anderson, Ms Janet (Ros'dale)||Enright, Derek|
|Armstrong, Hilary||Etherington, Bill|
|Ashton, Joe||Evans, John (St Helens N)|
|Austin-Walker, John||Ewing, Mrs Margaret|
|Barnes, Harry||Fatchett, Derek|
|Barron, Kevin||Field, Frank (Birkenhead)|
|Battle, John||Fisher, Mark|
|Bayley, Hugh||Flynn, Paul|
|Beckett, Rt Hon Margaret||Foster, Rt Hon Derek|
|Beggs, Roy||Foster, Don (Bath)|
|Beith, Rt Hon A J||Foulkes, George|
|Bell, Stuart||Fraser, John|
|Benn, Rt Hon Tony||Fyfe, Maria|
|Bennett, Andrew F||Galbraith, Sam|
|Benton, Joe||Galloway, George|
|Bermingham, Gerald||George, Bruce|
|Berry, Roger||Gerrard, Neil|
|Betts, Clive||Gilbert, Rt Hon Dr John|
|Blair, Rt Hon Tony||Godman, Dr Norman A|
|Blunkett, David||Godsiff, Roger|
|Boateng, Paul||Golding, Mrs Llin|
|Boyes, Roland||Gordon, Mildred|
|Bradley, Keith||Graham, Thomas|
|Brown, Gordon (Dunfermline E)||Grant, Bernie (Tottenham)|
|Brown, N (N'c'tle upon Tyne E)||Griffiths, Nigel (Edinburgh S)|
|Bruce, Malcolm (Gordon)||Griffiths, Win (Bridgend)|
|Burden, Richard||Grocott, Bruce|
|Byers, Stephen||Gunnell, John|
|Caborn, Richard||Hall, Mike|
|Callaghan, Jim||Hanson, David|
|Campbell, Menzies (Fife NE)||Hardy, Peter|
|Campbell, Ronnie (Blyth V)||Harman, Ms Harriet|
|Campbell-Savours, D N||Harvey, Nick|
|Cann, Jamie||Henderson, Doug|
|Chidgey, David||Heppell, John|
|Chisholm, Malcolm||Hill, Keith (Streatham)|
|Church, Judith||Hinchliffe, David|
|Clapham, Michael||Hodge, Margaret|
|Clark, Dr David (South Shields)||Hoey, Kate|
|Clarke, Tom (Monklands W)||Hogg, Norman (Cumbernauld)|
|Clelland, David||Home Robertson, John|
|Clwyd, Mrs Ann||Hood, Jimmy|
|Coffey, Ann||Hoon, Geoffrey|
|Cohen, Harry||Howarth, George (Knowsley North)|
|Connarty, Michael||Howells, Dr. Kim (Pontypridd)|
|Corbett, Robin||Hoyle, Doug|
|Corston, Jean||Hughes, Kevin (Doncaster N)|
|Cousins, Jim||Hughes, Robert (Aberdeen N)|
|Cox, Tom||Hughes, Roy (Newport E)|
|Cummings, John||Hughes, Simon (Southwark)|
|Cunliffe, Lawrence||Hutton, John|
|Cunningham, Jim (Covy SE)||Illsley, Eric|
|Cunningham, Rt Hon Dr John||Jackson, Glenda (H'stead)|
|Darling, Alistair||Jackson, Helen (Shef'ld, H)|
|Davies, Bryan (Oldham C'tral)||Jamieson, David|
|Davies, Rt Hon Denzil (Llanelli)||Janner, Greville|
|Davis, Terry (B'ham, H'dge H'l)||Jones, Barry (Alyn and D'side)|
|Denham, John||Jones, Jon Owen (Cardiff C)|
|Dewar, Donald||Jones, Lynne (B'ham S O)|
|Dixon, Don||Jones, Martyn (Clwyd, SW)|
|Jones, Nigel (Cheltenham)||Pike, Peter L|
|Jowell, Tessa||Powell, Ray (Ogmore)|
|Kaufman, Rt Hon Gerald||Prentice, Bridget (Lew'm E)|
|Keen, Alan||Prentice, Gordon (Pendle)|
|Kennedy, Charles (Ross,C&S)||Primarolo, Dawn|
|Kennedy, Jane (Lpool Brdgn)||Quin, Ms Joyce|
|Khabra, Piara S||Radice, Giles|
|Kilfoyle, Peter||Randall, Stuart|
|Kirkwood, Archy||Raynsford, Nick|
|Lestor, Joan (Eccles)||Redmond, Martin|
|Lewis, Terry||Reid, Dr John|
|Liddell, Mrs Helen||Rendel, David|
|Litherland, Robert||Robertson, George (Hamilton)|
|Livingstone, Ken||Robinson, Geoffrey (Co'try NW)|
|Lloyd, Tony (Stretford)||Roche, Mrs Barbara|
|Llwyd, Elfyn||Rogers, Allan|
|Loyden, Eddie||Rooker, Jeff|
|Lynne, Ms Liz||Rooney, Terry|
|McAllion, John||Ross, Ernie (Dundee W)|
|McCartney, Ian||Ruddock, Joan|
|Macdonald, Calum||Sedgemore, Brian|
|McFall, John||Sheerman, Barry|
|McKelvey, William||Sheldon, Rt Hon Robert|
|Mackinlay, Andrew||Short, Clare|
|Maclennan, Robert||Simpson, Alan|
|McMaster, Gordon||Skinner, Dennis|
|McNamara, Kevin||Smith, Andrew (Oxford E)|
|MacShane, Denis||Smith, Chris (Isl'ton S & F'sbury)|
|McWilliarn, John||Smyth, The Reverend Martin|
|Madden, Max||Snape, Peter|
|Maddock, Diana||Soley, Clive|
|Mahon, Alice||Spearing, Nigel|
|Mandelson, Peter||Speller, John|
|Marshall, David (Shettleston)||Squire, Rachel (Dunfermline W)|
|Marshall, Jim (Leicester, S)||Steinberg, Gerry|
|Martin, Michael J (Springburn)||Stevenson, George|
|Martlew, Eric||Stott, Roger|
|Maxton, John||Strang, Dr. Gavin|
|Meacher, Michael||Straw, Jack|
|Meale, Alan||Sutcliffe, Gerry|
|Michie, Bill (Sheffield Heeley)||Taylor, Mrs Ann (Dewsbury)|
|Michie, Mrs Ray (Argyll & Bute)||Taylor, Matthew (Truro)|
|Milburn, Alan||Thompson, Jack (Wansbeck)|
|Mitchell, Austin (Gt Grimsby)||Timms, Stephen|
|Moonie, Dr Lewis||Tipping, Paddy|
|Morgan, Rhodri||Tyler, Paul|
|Morley, Elliot||Vaz, Keith|
|Morris, Rt Hon Alfred (Wy'nshawe)||Walker, Rt Hon Sir Harold|
|Morris, Estelle (B'ham Yardley)||Wallace, James|
|Morris, Rt Hon John (Aberavon)||Walley, Joan|
|Mudie, George||Wardell, Gareth (Gower)|
|mullin, Chris||Watson, Mike|
|Oakes, Rt Hon Gordon||Wicks, Malcolm|
|O'Brien, Mike (N W'kshire)||Wigley, Dafydd|
|O'Brien, Wiliam (Normanton)||Williams, Rt Hon Alan (Sw'n W)|
|O'Hara, Edward||Worthington, Tony|
|Olner, Bill||Wray, Jimmy|
|O'Neil, Martin||Young, David (Bolton SE)|
|Orme, Rt Hon Stanley|
|Pearson, Ian||Tellers for the Ayes:|
|Pendry, Tom||Mr. Eric Clarke and Mr. Dennis Turner.|
|Ainsworth, Peter (East Surrey)||Atkinson, Peter (Hexham)|
|Aitken, Rt Hon Jonathan||Baker, Rt Hon Kenneth (Mole V)|
|Alexander, Richard||Baker, Nicholas (North Dorset)|
|Alison, Rt Hon Michael (Selby)||Baldry, Tony|
|Allason, Rupert (Torbay)||Banks, Matthew (Southport)|
|Amess, David||Banks, Robert (Harrogate)|
|Arbuthnot, James||Bates, Michael|
|Arnold, Jacques (Gravesham)||Bellingham, Henry|
|Arnold, Sir Thomas (Hazel Grv)||Bendell, Vivian|
|Ashby, David||Beresford, Sir Paul|
|Atkins, Robert||Biffen, Rt Hon John|
|Atkinson, David (Bour'mouth E)||Bonsor, Sir Nicholas|
|Booth, Hartley||Garel-Jones, Rt Hon Tristan|
|Boswell, Tim||Garnier, Edward|
|Bottomley, Peter (Eltham)||Gil, Christopher|
|Bottomley, Rt Hon Virginia||Gillan, Cheryl|
|Bowden, Sir Andrew||Goodlad, Rt Hon Alastair|
|Bowis, John||Goodson-Wickes, Dr Charles|
|Boyson, Rt Hon Sir Rhodes||Gorst, Sir John|
|Brandreth, Gyles||Grant, Sir A (SW Cambs)|
|Brazier, Julian||Greenway, Harry (Ealing N)|
|Bright Sir Graham||Greenway, John (Ryedale)|
|Brooke, Rt Hon Peter||Griffiths, Peter (Portsmouth, N)|
|Brown, M (Brigg & Cl'thorpes)||Grylls, Sir Michael|
|Browning, Mrs Angela||Gummer, Rt Hon John Selwyn|
|Bruce, Ian (Dorset)||Hague, William|
|Budgen, Nicholas||Hamilton, Rt Hon Sir Archibald|
|Burns, Simon||Hamilton, Neil (Tatton)|
|Burt, Alistair||Hampson, Dr Keith|
|Butcher, John||Hanley, Rt Hon Jeremy|
|Butler, Peter||Hannam, Sir John|
|Butterfill, John||Hargreaves, Andrew|
|Carlisle, John (Luton North)||Harris, David|
|Carlisle, Sir Kenneth (Lincoln)||Haselhurst Alan|
|Carrington, Matthew||Hawkins, Nick|
|Carttiss, Michael||Hawksley, Warren|
|Cash, William||Hayes, Jerry|
|Channon, Rt Hon Paul||Heald, Oliver|
|Churchill, Mr||Heath, Rt Hon Sir Edward|
|Clappison, James||Heathcoat-Amory, David|
|Clark, Dr Michael (Rochford)||Hendry, Charles|
|Clarke, Rt Hon Kenneth (Ru'clif)||Hicks, Robert|
|Clifton-Brown, Geoffrey||Higgins, Rt Hon Sir Terence|
|Colvin, Michael||Hill, James (Southampton Test)|
|Congdon, David||Horam, John|
|Conway, Derek||Hordern, Rt Hon Sir Peter|
|Coombs, Simon (Swindon)||Howard, Rt Hon Michael|
|Cope, Rt Hon Sir John||Howarth, Alan (Strat'rd-on-A)|
|Couchman, James||Howell, Sir Ralph (N Norfolk)|
|Currie, Mrs Edwina (S D'by'ire)||Hughes, Robert G. (Harrow W)|
|Curry, David (Skipton & Ripon)||Hunt, Rt Hon David (Wirral W)|
|Davies, Quentin (Stamford)||Hunt, Sir John (Ravensbourne)|
|Davis, David (Boothferry)||Hunter, Andrew|
|Day, Stephen||Jack, Michael|
|Deva, Nirj Joseph||Jackson, Robert (Wantage)|
|Delvin, Tim||Jenkin, Bernard|
|Dicks, Terry||Jessel, Toby|
|Douglas-Hamilton, Lord James||Johnson Smith, Sir Geoffrey|
|Dover, Den||Jones, Gwilym (Cardiff N)|
|Duncan, Alan||Jones, Robert B (W Hertfdshr)|
|Duncan Smith, Iain||Kellett-Bowman, Dame Elaine|
|Dunn, Bob||Key, Robert|
|Durant, Sir Anthony||King, Rt Hon Tom|
|Dykes, Hugh||Kirkhope, Timothy|
|Eggar, Rt Hon Tim||Knapman, Roger|
|Elletson, Harold||Knight Mrs Angela (Erewash)|
|Emery, Rt Hon Sir Peter||Knight, Greg (Derby N)|
|Evans, David (Welwyn Hatfield)||Knight, Dame Jill (Bir'm E'st'n)|
|Evans, Jonathan (Brecon)||Knox, Sir David|
|Evans, Nigel (Ribble Valley)||Kynoch, George (Kincardine)|
|Evans, Roger (Monmouth)||Lait, Mrs Jacqui|
|Evennett, David,||Lamont, Rt Hon Norman|
|Faber, David||Lang, Rt Hon Ian|
|Fabricant, Michael||Lawrence, Sir Ivan|
|Fenner, Dame Peggy||Legg, Barry|
|Field, Barry (Isle of Wight)||Leigh, Edward|
|Fishburn, Dudley||Lennox-Boyd, Sir Mark|
|Forman, Nigel||Lidington, David|
|Forsyth, Rt Hon Michael (Stirling)||Lilley, Rt Hon Peter|
|Forth, Eric||Lloyd, Rt Hon Sir Peter (Fareham)|
|Fox, Dr Liam (Woodspring)||Lord, Michael|
|Fox, Sir Marcus (Shipley)||Luff, Peter|
|Freeman, Rt Hon Roger||MacGregor, Rt Hon John|
|French, Douglas||MacKay, Andrew|
|Fry, Sir Peter||Maclean, David|
|Gale, Roger||McLoughlin, Patrick|
|Gallie, Phil||McNair-Wilson, Sir Patrick|
|Gardiner, Sir George||Madel, Sir David|
|Maitland, Lady Olga||Shepherd, Richard (Aldridge)|
|Major, Rt Hon John||Shersby, Michael|
|Malone, Gerald||Sims, Roger|
|Mans, Keith||Smith, Sir Dudley (Warwick)|
|Marland, Paul||Smith, Tim (Beaconsfield)|
|Marlow, Tony||Soames, Nicholas|
|Marshall, John (Hendon S)||Speed, Sir Keith|
|Marshall, Sir Michael (Arundel)||Spencer, Sir Derek|
|Martin, David (Portsmouth S)||Spicer, Sir James (W Dorset)|
|Mates, Michael||Spicer, Michael (S Worcs)|
|Mawhinney, Rt Hon Dr Brian||Spink, Dr Robert|
|Mellor, Rt Hon David||Spring, Richard|
|Merchant, Piers||Sproat Iain|
|Mills, Iain||Squire, Robin (Hornchurch)|
|Mitchell, Andrew (Gedling)||Steen, Anthony|
|Mitchell, Sir David (NW Hants)||Stephen, Michael|
|Moate, Sir Roger||Stern, Michael|
|Monro, Sir Hector||Stewart Allan|
|Montgomery, Sir Fergus||Streeter, Gary|
|Needham, Rt Hon Richard||Sweeney, Walter|
|Nelson, Anthony||Sykes, John|
|Neubert, Sir Michael||Tapsell, Sir Peter|
|Newton, Rt Hon Tony||Taylor, Ian (Esher)|
|Nicholls, Patrick||Taylor, John M (Solihull)|
|Nicholson, David (Taunton)||Temple-Morris, Peter|
|Nicholson, Emma (Devon West)||Thompson, Sir Donald (C'er V)|
|Norris, Steve||Thompson, Patrick (Norwich N)|
|Onslow, Rt Hon Sir Cranley||Thornton, Sir Malcolm|
|Oppenheim, Phillip||Townend, John (Bridlington)|
|Ottaway, Richard||Townsend, Cyril D (Bexl'yh'th)|
|Page, Richard||Tracey, Richard|
|Paice, James||Tredinnick, David|
|Patnick, Sir Irvine||Trend, Michael|
|Patten, Rt Hon John||Trotter, Neville|
|Pattie, Rt Hon Sir Geoffrey||Twinn, Dr Ian|
|Pawsey, James||Vaughan, Sir Gerard|
|Pickles, Eric||Viggers, Peter|
|Porter, Barry (Wirral S)||Waldegrave, Rt Hon William|
|Porter, David (Waveney)||Walden, George|
|Portillo, Rt Hon Michael||Walker, Bill (N Tayside)|
|Rathbone, Tim||Waller, Gary|
|Redwood, Rt Hon John||Wardle, Charles (Bexhill)|
|Renton, Rt Hon Tim||Waterson, Nigel|
|Richards, Rod||Watts, John|
|Riddick, Graham||Wells, Bowen|
|Robathan, Andrew||Whitney, Ray|
|Roberts, Rt Hon Sir Wyn||Whittingdale, John|
|Robertson, Raymond (Ab'd'n S)||Widdecombe, Ann|
|Robinson, Mark (Somerton)||Wiggin, Sir Jerry|
|Roe, Mrs Marion (Broxbourne)||Wilkinson, John|
|Rowe, Andrew(Mid Kent)||Willetts, David|
|Rumbold, Rt Hon Dame Angela||Winterton, Mrs Ann (Congleton)|
|Ryder, Rt Hon Richard||Wood, Timothy|
|Sackville, Tom||Yeo, Tim|
|Sainsbury, Rt Hon Sir Timothy||Young, Rt Hon Sir George|
|Scott, Rt Hon Sir Nicholas|
|Shaw, David (Dover)||Tellers for the Noes:|
|Shepherd, Rt Hon Gillian||Mr. Sydney Chapman and Mr. David Lightbown.|
|Shepherd, Colin (Hereford)|
§ Question accordingly negatived.
§ Question, That the proposed words be there added,put Forthwith pursuant to Standing Order No.30 (Questions on amendments):—
§ The House divided: Ayes 290, Noes 251.901
|Division No.73]||[10.14 pm|
|Ainsworth, Peter (East Surrey)||Amess, David|
|Aitken, Rt Hon Jonathan||Arbuthnot, James|
|Alexander, Richard||Arnold, Jacques (Gravesham)|
|Alison, Rt Hon Michael (Selby)||Arnold, Sir Thomas (Hazel Grv)|
|Allason, Rupert (Torbay)||Ashby, David|
|Atkins, Robert||Fenner, Dame Peggy|
|Atkinson, David (Bour'mouth E)||Field, Barry (Isle of Wight)|
|Atkinson, Peter (Hexham)||Fishburn, Dudley|
|Baker, Rt Hon Kenneth (Mole V)||Forman, Nigel|
|Baker, Nicholas (North Dorset)||Forsyth, Rt Hon Michael (Stirling)|
|Baldry, Tony||Forth, Eric|
|Banks, Matthew (Southport)||Fox, Dr Liam (Woodspring)|
|Banks, Robert (Harrogate)||Fox, Sir Marcus (Shipley)|
|Bates, Michael||Freeman, Rt Hon Roger|
|Bellingham, Henry||French, Douglas|
|Bendall, Vivian||Fry, Sir Peter|
|Beresford, Sir Paul||Gale, Roger|
|Biffen, Rt Hon John||Gallie, Phil|
|Bonsor, Sir Nicholas||Gardiner, Sir George|
|Booth, Hartley||Garel-Jones, Rt Hon Tristan|
|Boswell, Tim||Garnier, Edward|
|Bottomley, Peter (Eltham)||Gill, Christopher|
|Bottomley, Rt Hon Virginia||Gillan, Cheryl|
|Bowden, Sir Andrew||Goodlad, Rt Hon Alastair|
|Bowis, John||Goodson-Wickes, Dr Charles|
|Boyson, Rt Hon Sir Rhodes||Gorst, Sir John|
|Brandreth, Gyles||Greenway, Harry (Ealing N)|
|Brazier, Julian||Greenway, John (Ryedale)|
|Bright, Sir Graham||Griffiths, Peter (Portsmouth, N)|
|Brooke, Rt Hon Peter||Grylls, Sir Michael|
|Brown, M (Brigg & Cl'thorpes)||Gummer, Rt Hon John Selwyn|
|Browning, Mrs Angela||Hague, William|
|Bruce, Ian (Dorset)||Hamilton, Rt Hon Sir Archibald|
|Budgen, Nicholas||Hamilton, Neil (Tatton)|
|Burns, Simon||Hampson, Dr Keith|
|Burt, Alistair||Hanley, Rt Hon Jeremy|
|Butcher, John||Hannam, Sir John|
|Butler, Peter||Hargreaves, Andrew|
|Butterfill, John||Harris, David|
|Carlisle, John (Luton North)||Haselhurst, Alan|
|Carlisle, Sir Kenneth (Lincoln)||Hawkins, Nick|
|Carrington, Matthew||Hawksley, Warren|
|Carttiss, Michael||Hayes, Jerry|
|Cash, William||Heald, Oliver|
|Channon, Rt Hon Paul||Heath, Rt Hon Sir Edward|
|Churchill, Mr||Heathcoat-Amory, David|
|Clappison, James||Hendry, Charles|
|Clark, Dr Michael (Rochford)||Hicks, Robert|
|Clarke, Rt Hon Kenneth (Ru'clif)||Higgins, Rt Hon Sir Terence|
|Clifton-Brown, Geoffrey||Hill, James (Southampton Test)|
|Colvin, Michael||Horam, John|
|Congdon, David||Hordern, Rt Hon Sir Peter|
|Conway, Derek||Howard, Rt Hon Michael|
|Coombs, Simon (Swindon)||Howarth, Alan (Strat'rd-on-A)|
|Cope, Rt Hon Sir John||Howell, Sir Ralph (N Norfolk)|
|Couchman, James||Hughes, Robert G (Harrow W)|
|Currie, Mrs Edwina (S D'by'ire)||Hunt, Rt Hon David (Wirral W)|
|Curry, David (Skipton & Ripon)||Hurt, Sir John (Ravensbourne)|
|Davies, Quentin (Stamford)||Hunter, Andrew|
|Davis, David (Boothferry)||Jack, Michael|
|Day, Stephen||Jackson, Robert (Wantage)|
|Deva, Nirj Joseph||Jenkin, Bernard|
|Devlin, Tim||Jessel, Toby|
|Dicks, Terry||Johnson Smith, Sir Geoffrey|
|Douglas-Hamilton, Lord James||Jones, Gwilym (Cardiff N)|
|Dover, Den||Jones, Robert B (W Hertfdshr)|
|Duncan, Alan||Kelett-Bowman, Dame Elaine|
|Duncan Smith, Iain||Key, Robert|
|Dunn Bob||King, Rt Hon Tom|
|Durant, Sir Anthony||Kirkhope, Timothy|
|Dykes, Hugh||Knapman, Roger|
|Eggar, Rt Hon Tim||Knight, Mrs Angela (Erewash)|
|Elletson, Harold||Knight, Greg (Derby N)|
|Emery, Rt Hon Sir Peter||Knight, Dame Jill (Bir'm E'st'n)|
|Evans, David (Welwyn Hatfield)||Knox, Sir David|
|Evans, Jonathan (Brecon)||Kynoch, George (Kincardine)|
|Evans, Nigel (Ribble Valley)||Lait, Mrs Jacqui|
|Evans, Roger (Monmouth)||Lamont, Rt Hon Norman|
|Evennett, David||Lang, Rt Hon Ian|
|Faber, David||Lawrence, Sir Ivan|
|Fabricant, Michael||Legg, Barry|
|Leigh, Edward||Ryder, Rt Hon Richard|
|Lennox Boyd, Sir Mark||Sackville, Tom|
|Lidington, David||Sainsbury, Rt Hon Sir Timothy|
|Lightbown, David||Scott, Rt Hon Sir Nicholas|
|Lilley, Rt Hon Peter||Shaw, David (Dover)|
|Lloyd, Rt Hon Sir Pater (Fareham)||Shephard, Rt Hon Gillian|
|Lord, Michael||Shepherd, Colin (Hereford)|
|Luff, Peter||Shepherd, Richard (Aldridge)|
|MacGregor, Rt Hon John||Shersby, Michael|
|MacKay, Andrew||Sims, Roger|
|Maclean, David||Smith, Sir Dudley (Warwick)|
|McLoughlin, Patrick||Smith, Tim (Beaconsfield)|
|McNair-Wilson, Sir Patrick||Soames, Nicholas|
|Madel, Sir David||Speed, Sir Keith|
|Maitland, Lady Olga||Spencer, Sir Derek|
|Major, Rt Hon John||Spicer, Sir James (W Dorset)|
|Malone, Gerald||Spicer, Michael (S Worcs)|
|Mans, Keith||Spink, Dr Robert|
|Marland, Paul||Spring, Richard|
|Marlow, Tony||Sproat, Iain|
|Marshall, John (Hendon S)||Squire, Robin (Hornchurch)|
|Marshal, Sir Michael (Arundel)||Steen, Anthony|
|Martin, David (Portsmouth S)||Stephen, Michael|
|Mates, Michael||Stern, Michael|
|Mawhinney, Rt Hon Dr Brian||Stewart, Allan|
|Mellor, Rt Hon David||Streeter, Gary|
|Merchant, Piers||Sweeney, Walter|
|Mills, Iain||Sykes, John|
|Mitchell, Andrew (Gedling)||Tapsell, Sir Peter|
|Mitchell, Sir David (NW Hants)||Taylor, Ian (Esher)|
|Moate, Sir Roger||Taylor, John M (Solihull)|
|Monro, Sir Hector||Temple-Morris, Peter|
|Montgomery, Sir Fergus||Thomason, Roy|
|Needham, Rt Hon Richard||Thompson, Sir Donald (C'er V)|
|Nelson, Anthony||Thompson, Patrick (Norwich N)|
|Neubert, Sir Michael||Thornton, Sir Malcolm|
|Newton, Rt Hon Tony||Townend, John (Bridlington)|
|Nicholls, Patrick||Townsend, Cyril D (Bexl'yh'th)|
|Nicholson, David (Taunton)||Tracey, Richard|
|Nicholson, Emma (Devon West)||Tredinnick, David|
|Norris, Steve||Trend, Michael|
|Onslow, Rt Hon Sir Cranley||Trotter, Neville|
|Oppenheim, Phillip||Twinn, Dr Ian|
|Ottaway, Richard||Vaughan, Sir Gerard|
|Page, Richard||Viggers, Peter|
|Paice, James||Waldegrave, Rt Hon Willam|
|Patnick, Sir Irvine||Walden, George|
|Patten, Rt Hon John||Walker, Bill (N Tayside)|
|Pattie, Rt Hon Sir Geoffrey||Waller, Gary|
|Pawsey, James||Wardle, Charles (Bexhill)|
|Pickles, Eric||Waterson, Nigel|
|Porter, Barry (Wirral S)||Watts, John|
|Porter, David (Waveney)||Wells, Bowen|
|Portillo, Rt Hon Michael||Whitney, Ray|
|Rathbone, Tim||Whittingdale, John|
|Redwood, Rt Hon John||Widdecombe, Ann|
|Renton, Rt Hon Tim||Wiggin, Sir Jerry|
|Richards, Rod||Wilkinson, John|
|Riddick, Graham||Winterton, Mrs Ann (Congleton)|
|Robathan, Andrew||Wood, Timothy|
|Roberts, Rt Hon Sir Wyn||Yeo, Tim|
|Robertson, Raymond (Ab'd'n S)||Young, Rt Hon Sir George|
|Robinson, Mark (Somerton)|
|Roe, Mrs Marion (Broxbourne)||Tellers for the Ayes:|
|Rowe, Andrew (Mid Kent)||Mr. Sydney Chapman and Mr. David Willetts.|
|Rumbold, Rt Hon Dame Angela|
|Abbott, Ms Diane||Ashton, Joe|
|Ainger, Nick||Austin-Walker, John|
|Ainsworth, Robert (Cov'try NE)||Barnes, Harry|
|Allen, Graham||Barron, Kevin|
|Alton, David||Battle, John|
|Anderson, Donald (Swansea E)||Bayley, Hugh|
|Anderson, Ms Janet (Ros'dale)||Beckett, Rt Hon Margaret|
|Armstrong, Hilary||Beith, Rt Hon A J|
|Bell, Stuart||Gordon, Mildred|
|Benn, Rt Hon Tony||Graham, Thomas|
|Bennett, Andrew F||Grant, Bernie (Tottenham)|
|Benton, Joe||Griffiths, Nigel (Edinburgh S)|
|Bermingham, Gerald||Griffiths, Win (Bridgend)|
|Berry, Roger||Grocott, Bruce|
|Betts, Clive||Gunnel, John|
|Blair, Rt Hon Tony||Hall, Mike|
|Blunkett, David||Hanson, David|
|Boateng, Paul||Hardy, Peter|
|Boyes, Roland||Harman, Ms Harriet|
|Bradley, Keith||Harvey, Nick|
|Brown, Gordon (Dunfermline E)||Henderson, Doug|
|Brown, N (N'c'tle upon Tyne E)||Heppell, John|
|Bruce, Malcolm (Gordon)||Hill, Keith (Streatham)|
|Burden, Richard||Hinchliffe, David|
|Byers, Stephen||Hodge, Margaret|
|Caborn, Richard||Hoey, Kate|
|Callaghan, Jim||Hogg, Norman (Cumbernauld)|
|Campbell, Menzies (Fife NE)||Home Robertson, John|
|Campbell, Ronnie (Blyth V)||Hood, Jimmy|
|Campbell-Savours, D. N.||Hoon, Geoffrey|
|Cann, Jamie||Howarth, George (Knowsley North)|
|Chidgey, David||Howells, Dr. Kim (Pontypridd)|
|Chisholm, Malcolm||Hoyle, Doug|
|Church, Judith||Hughes, Kevin (Doncaster N)|
|Clapham, Michael||Hughes, Robert (Aberdeen N)|
|Clark, Dr David (South Shields)||Hughes, Roy (Newport E)|
|Clarke, Tom (Monklands W)||Hughes, Simon (Southwark)|
|Clelland, David||Hutton, John|
|Clwyd, Mrs Ann||Illsley, Eric|
|Coffey, Ann||Jackson, Glenda (H'stead)|
|Cohen, Harry||Jackson, Helen (Shef'ld, H)|
|Connarty, Michael||Jamieson, David|
|Corbett, Robin||Janner, Greville|
|Corston, Jean||Jones, Barry (Alyn and D'side)|
|Cousins, Jim||Jones, Jon Owen (Cardiff C)|
|Cox, Tom||Jones, Lynne (B'ham S O)|
|Cummings, John||Jones, Martyn (Clwyd, SW)|
|Cunliffe, Lawrence||Jones, Nigel (Cheltenham)|
|Cunningham, Jim (Covy SE)||Jowell, Tessa|
|Cunningham, Rt Hon Dr John||Kaufman, Rt Hon Gerald|
|Darling, Alistair||Keen, Alan|
|Davies, Bryan (Oldham C'tral)||Kennedy, Charles (Ross,C&S)|
|Davies, Rt Hon Denzil (Llanelli)||Kennedy, Jane (Lpool Brdgn)|
|Davis, Terry (B'ham, H'dge H'l)||Khabra, Piara S|
|Denham, John||Kilfoyle, Peter|
|Dewar, Donald||Kirkwood, Archy|
|Dixon, Don||Lestor, Joan (Eccles)|
|Dobson, Frank||Lewis, Terry|
|Dowd, Jim||Liddell, Mrs Helen|
|Dunnachie, Jimmy||Litherland, Robert|
|Dunwoody, Mrs Gwyneth||Livingstone, Ken|
|Eagle, Ms Angela||Lloyd, Tony (Stratford)|
|Eastham, Ken||Llwyd, Elfyn|
|Enright, Derek||Loyden, Eddie|
|Etherington, Bill||Lynne, Ms Liz|
|Evans, John (St Helens N)||McAllion, John|
|Ewing, Mrs Margaret||McCartney, Ian|
|Fatchett, Derek||Macdonald, Calum|
|Field, Frank (Birkenhead)||McFall, John|
|Fisher, Mark||McKelvey, William|
|Flynn, Paul||Mackinlay, Andrew|
|Foster, Rt Hon Derek||Maclennan, Robert|
|Foster, Don (Bath)||McMaster, Gordon|
|Foulkes, George||McNamara, Kevin|
|Fraser, John||MacShane, Denis|
|Fyfe, Maria||McWilliam, John|
|Galbraith, Sam||Madden, Max|
|Galloway, George||Maddock, Diana|
|George, Bruce||Mahon, Alice|
|Gerrard, Neil||Mandelson, Peter|
|Gilbert, Rt Hon Dr John||Marshall, David (Shettleston)|
|Godman, Dr Norman A||Marshall, Jim (Leicester, S)|
|Godsiff, Roger||Martin, Michael J (Springburn)|
|Golding, Mrs Lin||Martlew, Eric|
|Maxton, John||Rooney, Terry|
|Meacher, Michael||Ross, Ernie (Dundee W)|
|Meale, Alan||Ruddock, Joan|
|Michie, Bill (Sheffield Heeley)||Sedgemore, Brian|
|Michie, Mrs Ray (Argyll & Bute)||Sheerman, Barry|
|Milburn, Alan||Sheldon, Rt Hon Robert|
|Mitchell, Austin (Gt Grimsby)||Short, Clare|
|Moonie, Dr Lewis||Simpson, Alan|
|Morgan, Rhodri||Skinner, Dennis|
|Morley, Elliot||Smith, Andrew (Oxford E)|
|Morris, Rt Hon Alfred (Wy'nshawe)||Smith, Chris (Isl'ton S & F'sbury)|
|Morris, Estelle (B'ham Yardley)||Snape, Peter|
|Morris, Rt Hon John (Aberavon)||Soley, Clive|
|Mudie, George||Spearing, Nigel|
|Oakes, Rt Hon Gordon||Squire, Rachel (Dunfermline W)|
|O'Brien, Mike (N W'kshire)||Steinberg, Gerry|
|O'Brien, William (Normanton)||Stevenson, George|
|O'Hara, Edward||Stott, Roger|
|Olner,Bill||Strang, Dr. Gavin|
|O'Neil, Martin||Straw, Jack|
|Orme, Rt Hon Stanley||Sutcliffe, Gerry|
|Taylor, Mrs Ann (Dewsbury)|
|Pearson, Ian||Taylor, Matthew (Truro)|
|Pendry,Tom||Thompson, Jack (Wansbeck)|
|Pickthall, Colin||Timms, Stephen|
|Pike, Peter L||Tipping, Paddy|
|Powell, Ray (Ogmore)||Tyler, Paul|
|Prentice, Bridget (Lew'm E)||Vaz, Keith|
|Prentice, Gordon (Pendle)||Walker, Rt Hon Sir Harold|
|Primarolo, Dawn||Wallace, James|
|Purchase, Ken||Walley, Joan|
|Quin, Ms Joyce||Wardell, Gareth (Gower)|
|Radice, Giles||Watson, Mike|
|Randal, Stuart||Wicks, Malcolm|
|Raynsford, Nick||Wigley, Dafydd|
|Redmond, Martin||Wiliams, Rt Hon Alan (Sw'n W)|
|Reid, Dr John||Worthington, Tony|
|Rendel, David||Wray, Jimmy|
|Robertson, George (Hamilton)||Young, David (Bolton SE)|
|Robinson, Geoffrey (Co'try NW)|
|Roche, Mrs Barbara||Tellers for the Noes:|
|Rogers, Allan||Mr. Eric Clarke and Mr. Dennis Turner.|
§ Question accordingly agreed to
§ MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.
That this House welcomes the fact that the vast majority of people are significantly better off today than in 1979, and notes, in particular, that the average pensioner is now more than 50 per cent. better off; approves the Government's policy of ensuring that social security spending does not outstrip the nation's ability to pay while focusing resources on those who need it most; applauds the fact that the Government has channelled an extra £1 billion a year to low income families, and an even greater sum to poorer pensioners, since 1988; welcomes the high priority accorded by the Government to education and training; recognises that employment is the best route to higher incomes, and commends the package of work incentives, including the child care disregard and the Back to Work Bonus, which the Government has introduced; applauds the Government's achievement in reducing unemployment by over half a million since 1992 and notes the fact that a national minimum wage would increase unemployment; and deplores the Opposition's failure to reveal the level of their national minimum wage, how they would deal with differentials, their social security policies and their costs.