HC Deb 17 July 2000 vol 354 cc6-9
4. Fiona Mactaggart (Slough)

What assessment he has made of levels of poverty in the UK and other developed countries over the last 10 years, following UNICEF's recent report on poverty. [129322]

The Secretary of State for Social Security (Mr. Alistair Darling)

Research shows that we inherited one of the highest rates of poverty in the western world. As a result of policies that we have announced so far, we will lift over 1 million children out of poverty as well as tackling pensioner poverty.

Fiona Mactaggart

Is my right hon. Friend aware that UNICEF's table on Britain's shockingly bad place in child poverty leagues shows that we score among the top countries for the numbers of children in lone parent families, in workless households and in households with low wages? Does it occur to him that if he were to respond positively to the siren voices of the Conservatives by abolishing the new deal for lone parents, we should sink even further down the international child poverty league rather than tackling that scandal?

Mr. Darling

The new deal for lone parents almost pays for itself, so there would be no great saving if it were cancelled. Indeed, the position would be quite the reverse. My hon. Friend is quite right to say that we inherited a scandal: Britain is one of the richest countries in the world, but the number of children living in poverty trebled during the 18 years to 1997. She was also right to identify the importance of measures to get more people into work. The number of people living in workless households is falling, but it is necessary to do more, such as increasing child benefit.

The Conservative party has a point to answer. The Opposition are determined to find £16 billion in public expenditure cuts. We all remember that they froze child benefit when they were in office, which offers a pointer to the sort of thing that they would do. Those who would suffer are many of the children who still live in poverty and who rely on us to lift them out of it.

Mr. Steve Webb (Northavon)

The Secretary of State is right to point to the high poverty that he inherited. On 1 May 1997, many people hoped for a break in the long-term rapid growth of a divided Britain. Does he share my dismay, therefore, at figures produced by his Department last week showing that the trend continues, particularly among pensioners? How confident is he that the measures that he has introduced since those figures were published will reverse the trend and return pensioner poverty to the level that he inherited? Over what time scale will we begin to see serious inroads into the problem?

Mr. Darling

Let me deal with the point on pensioners. The hon. Gentleman is right to say that the number of pensioners living in poverty has risen slightly. The reason is that although the proportion of pensioners living in poverty remains exactly the same, the pensioner population is increasing. He has not mentioned, however, that the minimum income guarantee and other measures were introduced only from April 1999 and do not, therefore, affect last week's figures.

Mr. Webb


Mr. Darling

The hon. Gentleman may nod now, but that is not what he said to newspapers last week.

We knew that many pensioners were in poverty. That is why we introduced the minimum income guarantee. If we had provided an across-the-board increase, we would not have solved the problem of pensioner poverty. The measures that we have introduced will do so. Year on year, people will see improvements as we reduce the number of pensioners living in poverty. In addition, we shall introduce proposals for a pensioner credit later this year, which will help many pensioners who have modest savings or modest amounts in the bank.

Mr. Michael Connarty (Falkirk, East)

I am glad to hear the Secretary of State focus on pensioner poverty. I support the minimum income guarantee, which I, like others, have pushed hard in my own constituency. Does he accept, however—as I have said to him privately—that other measures such as the heating allowance are, according to the pensioners who have spoken to me, seen as gimmicks? What pensioners want, and what everyone wants for the sake of the Government's credibility, is a good, across the board increase for all pensioners. Will the Minister argue with the Chancellor for such an increase, on top of all the other measures, and when will pensioners receive it?

Mr. Darling

I shall not repeat what I said privately to the hon. Gentleman. He draws attention to the minimum income guarantee; since we launched our take-up campaign earlier this year, more than 130, 000 claims have been received, showing that the availability of the guarantee has begun to extend beyond the 1.5 million pensioners already receiving it.

I disagree with the hon. Gentleman on the winter payments. The advantage of making those payments in their present form is that they are tax free and are not taken into account for benefits. If they were added to the pension, the very pensioners about whom he and I are concerned—those on low incomes—would lose out. I must disagree with him on that point.

Mr. David Willetts (Havant)

What a fascinating exchange. At last, the Secretary of State admits that the number of pensioners in poverty has gone up, and his hon. Friend the Member for Falkirk, East (Mr. Connarty) rightly speaks for millions of pensioners who do not want the gimmicks; they want a reliable, basic state pension that is worth something. Buried on page 170 of the document that the Secretary of State published last week are some devastating figures. Do they not show that the number of families in poverty—with below half average income—has risen by half a million since Labour came to office? Many of those people are pensioners. Is that not a fraud perpetrated on the pensioner population?

Mr. Darling

What is a fraud is to suggest that the Tory party had nothing to do with the problems that we inherited or, indeed, to suggest that the Tories would do anything in the future. We came into office inheriting a situation in which the number of children living in poverty had trebled and almost 200 million pensioners were living in poverty. The problem arose because, whereas some pensioners saw their income go up by as much as 80 per cent. during the past 20 years, far too many pensioners saw their income go up by substantially less than that.

The problem with an across the board increase is that it does not help the poorest pensioners. The best that could be said for the proposals the Tories announced a month or so ago was that some pensioners would get 42, p extra a week before tax and before they started to lose benefits. Of course, 2 million pensioners would lose out as a result of their proposals—those pensioners are the poorest in the country.

We are determined to help alleviate pensioner poverty. We want to lift pensioners out of poverty and we will do that. The report published by the Government last week shows the scale of the problem that we inherited, as did the UNICEF report published a few months ago. Unlike the Conservatives, we are determined to lift pensioners and others out of poverty. Unlike the Conservatives, we have got, and are prepared to spend, the money to do so.

Mr. Willetts

The Secretary of State well knows that our proposals on pensions would go to all pensioners, including those who pay tax and those who are on means-tested benefits. Our proposals are costed on that basis.

The Secretary of State is always keen to blame everyone else and to blame his inheritance. Let me quote from another report. A report from the Cabinet Office, drawn up while the Labour Government were in office, made the following statement on their record on poverty: there are too many Government initiatives, causing confusion; not enough co-ordination; and too much time spent on negotiating the system, rather than delivering.

Is not that the record of the Government? Too much time is spent on negotiating the system and not enough on delivering. No wonder the Secretary of State's boss has admitted, as we know from today's memo, that All of these things add up to a sense that the government…are somehow out of touch with gut British instincts. Is not that their record on welfare?

Mr. Darling

I am surprised that the hon. Gentleman did not refer to the UNICEF report that is the subject of the question. When it was published two months ago, a Conservative party research bulletin was issued on the same day as the hon. Gentleman was quoted as saying: We recognise that there is a problem with child poverty in this country…The report— that is, the UNICEF report— reveals shocking statistics about life in Britain for millions of children. The hon. Gentleman did not point out that the report covered 1995, when he was a Minister. He should not complain when I draw attention to the fact that poverty—whether child or pensioner poverty—grew up over years.

Of course, it will take time to turn that around. The difference between us and the Conservative party is that we are spending some £6.5 billion more on supporting pensioner incomes than they plan to do. We are spending a similar amount on helping families with children—especially on alleviating child poverty. Yes, it will take time, but the difference is that, at the end of this Parliament, people will be able to see that we are turning the situation around. If they ever have the Tories back, there will be more pensioner and child poverty in this country.