HC Deb 21 May 1996 vol 278 cc87-9
7. Sir Michael Neubert

To ask the Secretary of State for Social Security what has been the annual average real growth in social security expenditure since 1966; and what was the figure in 1995–96. [28810]

Mr. Lilley

Between 1965–66 and 1995–96, social security expenditure grew in real terms by an average of 4.4 per cent. a year. Growth to 1998–99 is projected to be 1.3 per cent. a year—well within the expected growth of the economy.

Sir Michael Neubert

What does that reduction in average real growth represent in savings to the social security budget? What prospects are there of its continuing into the next century?

Mr. Lilley

The reforms that we have introduced, amounting to the biggest programme of welfare reform since the Beveridge policy was introduced in 1948, will save in the next Parliament some £5 billion a year and in due course more than £15 billion a year. All our reforms have been opposed by the Labour party.

Mr. Alan Howarth

As the Minister reflects on the growth of social security spending, will he also consider how small a part of that growth is accounted for by support for carers, who save the Exchequer an estimated £34 billion a year but who often impoverish themselves in giving that service? Will he review the system of benefits for them, including the threshold of earnings at which the invalid care allowance is withdrawn; and the hours of caring that have to be put in to qualify for invalid care allowance? Will he particularly review the ridiculous and hurtful rule that allows people the allowance if they support one person for 35 hours a week but not if they support two people—perhaps two elderly parents—for the same amount of time?

Will the Minister raise the invalid care allowance and extend the carers premium on income support to people who take up the responsibility after the age of 65?

Mr. Lilley

The hon. Gentleman knows full well, because he studies these matters, that carers' benefits are the fastest growing area of expenditure in the welfare system. He was outspoken on welfare issues during his time in my party. I wonder whether he is going to say in public what we know he believes in private about the proposals of his new party to take away child benefit from those who stay on at school. Or is he now less willing to parade his conscience in public?

Mr. Evennett

Does my right hon. Friend agree that his reforms are designed to target those in greatest need and to increase incentives to get people back into work?

Mr. Lilley

My hon. Friend is absolutely right. A key to getting people back into work is the jobseeker's allowance, which we introduced in the teeth of Labour opposition and which we know Labour is determined to withdraw and abolish. We are amused to hear Labour Members say that this is part of another review—it is time they stopped reviewing and came up with concrete proposals and policies.

Mr. Chris Smith

Does the Secretary of State accept that a major component of rising social security expenditure in recent years has been the growth in expenditure on housing benefit? Does he accept the conclusion of the Social Security Committee last week, that something like £2 billion a year is being defrauded from the housing benefit system, much of it by private sector landlords? Will the Secretary of State now take far more seriously the issue of landlord fraud on housing benefit? Will he accept the sensible recommendations of the Select Committee?

Mr. Lilley

I have introduced a number of reforms to deal with exactly the problem of housing benefit fraud. The Labour party opposed them all. I introduced penalties and rewards for local authorities—particularly Labour-controlled authorities—that had done shamefully little to crack down on housing benefit fraud, which was their responsibility. We want to know when the hon. Gentleman will produce concrete proposals on anything. John Smith set up a social justice commission to review social security policy. When it reported, the Leader of the Opposition promised to review its proposals and ordered the hon. Member for Islington, South and Finsbury (Mr. Smith) to review that review. As soon as his hon. Friends make any concrete proposals, the hon. Member for Dunfermline, East (Mr. Brown) promises a further review. The hon. Gentleman is a serial reviewer.

Sir James Molyneaux

Does the Secretary of State detect a certain convergence of views between the two Front Benches on the need to contain escalating social security spending, which will otherwise race out of control in the next century?

Mr. Lilley

I wish that there were a convergence between the two Front Benches on the issue of social security, but the Labour party has opposed every reform that I have introduced. Every Labour proposal involves increased spending. What Labour Members describe as "hard choices" are simply methods of financing further Government expenditure by taking away money from ordinary families. I am afraid that Labour remains the party of high spending.