HC Deb 29 November 1999 vol 340 cc7-8
3. Mr. Julian Brazier (Canterbury)

What estimates he has made of the numbers of people receiving means-tested benefits (a) in May 1997 and (b) in May 2001. [99061]

The Parliamentary Under-Secretary of State for Social Security (Mr. Hugh Bayley)

We estimate that the number of people in receipt of one or more of the means-tested benefits in May 1997 was about 8 million. We forecast that the number will reduce to about 7.9 million in May 2001, including those receiving the working families tax credit. The reduction reflects the Government's success in enabling people to get off jobseeker's allowance and back into work.

Mr. Brazier

The reply reflects the fact that unemployment is falling at this point in the economic cycle. Does the Minister accept that putting a large number of new people onto a means-tested benefit—the working families tax credit—and putting many of them on a combined tax and benefit withdrawal rate of more than 80 per cent. will in the long run militate against self-help, lead to a loss of self-confidence and encourage dependency?

Mr. Bayley

The hon. Gentleman must be aware that our economic policies have reduced unemployment and increased the total number of people in work by 400,000, to the highest level ever. His comments about the working families tax credit are entirely wrong. It will boost the incomes of 1.5 million families by an average of £24 a week. Come the next general election, the Conservative party will find that its opposition to it will cost it hundreds of thousands of votes.

Mr. Paul Goggins (Wythenshawe and Sale, East)

My hon. Friend will no doubt have been encouraged to learn that over the first two years of this Parliament the number of income support claimants fell by more than 400,000, or more than 750,000 if one includes children and other dependants. Is not that proof that the Government are not merely talking about defeating poverty but are getting on and doing it?

Mr. Bayley

My hon. Friend makes the point extremely powerfully. The Government have set extremely challenging targets over the long term to reduce poverty. We have made a start and our policies are having the desired effect.

Mr. Steve Webb (Northavon)

Will the Minister reflect on three facts: that pensioners resent being forced to go through a means test simply to get a decent income; that his decision to increase pensions by 75p next April will force thousands more into the means test; and that his policy of a state second pension and stakeholder pension will not touch pensioner incomes for a decade or more? Is it not true that the Government have no policy to reduce pensioner dependence on means tests for a decade to come?

Mr. Bayley

That is absolute nonsense. The Government have policies in the long term to reform the pension system so that so many elderly people—the proportion is one in five at present—do not have to be dependent on means-tested benefits, and we are taking action now to improve the position of pensioners. Our predecessors, the Conservatives, simply increased the pension each year by the rate of inflation. On top of the 75p inflation increase this year, we have provided a £100 winter fuel bonus for all pensioners—that is almost £2 a week extra for each pensioner household.

Mr. Dale Campbell-Savours (Workington)

Has there been a reduction or increase in the take-up of housing benefit, and how is the review of housing benefit coming on? Are we getting somewhere?

Mr. Bayley

The review of housing benefit is continuing, and I hope that my hon. Friend the Under-Secretary will make an announcement in due course.