Pensions

HC Deb 08 June 2000 vol 351 cc438-83

Madam Speaker

We now come to the first debate on the Opposition motions. I have selected the amendment in the name of the Prime Minister.

1.25 pm

Mr. David Willetts (Havant)

I beg to move, That this House believes that the Government's policy towards pensioners is patronising and confusing; recognises that pensioners want the dignity of receiving social security through their basic state pension as an entitlement and not through complicated special payments; urges therefore that the winter fuel payment, free TV licence, and the age addition, along with funds from abolishing the failed New Deal for Lone Parents and other savings, should all be put into a substantial increase in the basic state pension for 2001/2002 of £5.50 for a single pensioner under 75, £7 for a couple under 75, £7.50 for a single pensioner over 75, and £10 for a couple over 75, together with a commensurate increase in thresholds for benefits and tax allowances, so that the value of the increase is passed on to all pensioners, ensuring that they are better off than at present under this Government's muddled and incompetent policies. Yesterday, in his now notorious speech to the Women's Institute, the Prime Minister said:

We should put more faith in people's desire to engage in a conversation about the future. What better way of engaging in a conversation about the future than a Supply day debate in the House?

We called the debate because we wanted pensioners' voices to be heard in the great national conversation called for by the Prime Minister. We want pensioners' voices to be heard because they are saying, loud and clear to all of us in our constituencies, that they are fed up with the Government's patchwork of special measures and gimmicks. Instead, they want money to go into the basic state pension as an entitlement.

The Government's special measures have gone down like a lead balloon—or perhaps we should now say that they have gone down as badly as the Prime Minister at the WI. They have gone down badly with the pensioners whom the Government claim to want to help. The Prime Minister's speech at the WI was received almost as badly as the Minister of State's, when he tried to explain the Government's policies at the National Pensioners Convention the other day. I am sure that he learned what pensioners think about the Government's policies.

Pensioners say over and over again that the Government's schemes are complicated, whereas pensioners want simplicity; the Government's schemes are patronising, whereas pensioners want respect. I shall quote from one of the many letters that I have received from pensioners. The letter arrived in my post this morning from a pensioner in Suffolk, who writes: I wonder how long it will be for them to get it into their thick heads that pensioners do not want crumbs thrown at them from lord and lady Bountiful Blair's table. . . what they do want is a fair and reasonable pension, and the same amount of pension for all pensioners. We wish to pay our way like everybody else and object strongly when we are made to become forelock touching, cap in hand, second class citizens. That summarises what millions of pensioners think—not just pensioners, but their representatives. The director general of Help the Aged described the hand-outs as a patronising pat on the back and continued:

What older people want is a decent weekly income which they can spend as they wish, and with dignity.

Dr. Lynne Jones (Birmingham, Selly Oak)

The hon. Gentleman quotes from organisations such as Help the Aged. He knows that those organisations are calling for a large increase in the state pension and a restoration of the link to earnings. Does the hon. Gentleman intend to change Conservative policy from the past, when the party broke that link, and restore it now?

Mr. Willetts

I recognise that many pensioners want the restoration of the earnings link, but neither the Opposition nor the Government are offering that. Pensioners must choose between the options before them. We believe that our option is superior to the only alternative, which is what the Government are doing.

Mr. Patrick Nicholls (Teignbridge)

Bearing in mind the call that has just been made for the restoration of the earnings link, will my hon. Friend confirm that although the last Labour Government introduced an earnings link, for the last four years of the Labour Government they refused to implement it in practice? When their Secretary of State, who later became Lord Ennals, was quizzed by Pensioners' Voice about his statutory obligation, he sneeringly replied: I have an obligation to take the figures into account. I do not have an obligation to get the figures right.

Mr. Willetts

My hon. Friend is right in his recollection of the history of that incident.

It is not just pensioners who are critical of the Government's schemes. Labour's activists and supporters say the same thing. Labour councillors lost 600 seats after the last local elections. A survey of Labour councillors who had lost their places on councils revealed that pensioners overwhelmingly preferred to get money straight into their pockets directly from their pension.

That is what even some of the Secretary of State's colleagues have been saying in the privacy of unattributable briefings in the Lobby. One Labour MP was quoted as saying: It's like a poor employer who robs his workers every week, then gives them a turkey for Christmas. Perhaps one of the Labour Members who are present today said that. Perhaps it was the Minister of State, speaking unattributably; who knows? [HON. MEMBERS: "Deny it."] I will not ask Labour Members to deny it. That would be too embarrassing for them.

Another Labour MP said:

It's terrible. The Tory leader is saying in public what we have been saying in private for months. That is what Labour Members think. The Secretary of State has even got his former ministerial colleagues saying it. A former Defence Minister has said that pensioners believe that winter fuel payments and concessionary television licences are diversionary measures and that pensioners want an increase, week on week, in the basic pension.

Mr. Steve Webb (Northavon)

Why, then, did the hon. Gentleman tell the House: We have no plans to remove the winter fuel payment. —[Official Report, 7 February 2000; Vol. 344, c. 33.]

Mr. Willetts

I was very careful. We have listened, we have learned, and we have now announced our policy. The hon. Gentleman's party fought the last election on a manifesto that pledged it simply to linking pensions to prices; subsequently, it changed its mind and said that it wanted to link them to earnings after all. That is a wild and uncosted policy, so that was a dangerous intervention.

Mr. John Bercow (Buckingham)

Does my hon. Friend think that opposition to the Government's policies on pensioners explains the drop of over 1,000 in membership of the Sedgefield constituency Labour party, the recent emergence of a rebel breakaway group, and its decision to distribute a subversive newsletter that excoriates the Prime Minister's record?

Mr. Willetts

I am sure that my hon. Friend has made a powerful point. I am only surprised that he said "1,000" rather than "1,007 precisely", in the style with which we are so familiar. Anyway, he is entirely correct.

The fact is that pensioners do not support what the Government are doing, Labour councillors do not support what the Government are doing, and the Secretary of State's own Back Benchers do not believe in what the Government are doing. The question is why the Government plough on with such an unpopular and ill-considered policy, when everyone in the country apart from the Secretary of State and his Cabinet colleagues knows that it is a nonsense. That is the real question to which we would like to hear the Secretary of State's answer.

Kali Mountford (Colne Valley)

Is it not the case that state pensions have been paid for through national insurance contributions? Is the hon. Gentleman now advocating paying for pensions in some other way, given that his sums do not add up?

Mr. Willetts

I will take the hon. Lady through the sums in a moment, if she wishes me to do so. The fact is, however, that we are talking about a carefully costed package that involves no increase in total social security spending. The national insurance fund is in surplus. Pensioners want a charge on the national insurance fund as part of a contributory entitlement, and it could easily be afforded.

Mr. Edward Leigh (Gainsborough)

May I gently chide my hon. Friend? He talks about the Secretary of State. One thing that is really frustrating in life is, having dreamt up a good policy, finding that someone much cleverer has come up with it first. Could that explain the petulance behind the Secretary of State's remarks? Perhaps he was planning to introduce the policy, but my hon. Friend got there first.

Mr. Willetts

Who knows? It would be interesting to find out. The Government have been busy briefing away on all sorts of options. It would be fascinating to learn whether they have listened to pensioners as we have.

Let me tackle the sort of arguments that we may hear from the Secretary of State. I am sure that he will not want to answer the question that has just been put. I suspect that he will say that the Government are doing the right thing, because they are targeting help on the pensioners who need it most. That is what he has been claiming. However, his claim does not stand up to scrutiny.

What we are doing is replacing the various special payments with a consolidated increase in the basic pension. The Secretary of State's special payments are very ill targeted. He has put much more money into the special payments than he has into the minimum income guarantee. This year, £1 billion more is going into the special payments than into the minimum income guarantee. Next year, £0.5 billion more will go into special payments than the guarantee. The money that the Government have put in has gone, above all, into the special schemes that we are consolidating into the basic pension. Nothing in our proposal affects minimum income guarantee expenditure. It is all about consolidating those gimmicks.

I was surprised by some of the Secretary of State's claims about the targeting of his measures. On 16 December 1999, in a press notice from his Department, he said: The annual Winter Fuel Payment will be payable to everyone over 60. I invite him to say whether that is an accurate and true statement on access to the winter fuel payment scheme. He knows that that is not an accurate statement of the way in which the scheme works. He knows very well—if he did not know when he issued that press release, he should have—that winter fuel payments are not available to pensioners in residential accommodation or nursing homes who are on income support. They are available to pensioners who are in nursing homes or residential accommodation who are not on income support, but they are not available if pensioners are on income support. There are 200,000 pensioners on income support who do not receive the payment, whereas more affluent pensioners in residential accommodation do receive it. It is nonsense.

Either the Secretary of State did not understand his policy when he made that statement, or he was deliberately misleading. The fact is that what we are doing, putting the money into the basic pension, is better targeted than the measures that it replaces. It is better targeted because the quirks, oddities and unpredictable effects of those schemes—which, to be honest, I do not think the Secretary of State fully appreciated when they were introduced—will be replaced by a steady, reliable simple system. Better than that, we are giving the extra money to the over-75s in particular. We all know that older pensioners tend to be the poorer pensioners.

Mr. Phil Hope (Corby)

I have listened to the hon. Gentleman for the past 10 minutes or so and I have not heard one word of apology for the 18 years that resulted in 1 million pensioners living below the poverty line in 1997—[Interruption.] The Labour Government have targeted and tackled that, much to my pleasure and much to the annoyance of Opposition Members. Will he now apologise to the 1 million pensioners whom he betrayed for more than 18 years? [Interruption.]

Mr. Deputy Speaker (Mr. Michael J. Martin)

Order. We cannot haves a situation where hon. Members are shouted down.

Mr. Willetts

The hon. Member for Corby (Mr. Hope) is rash enough to make that point. Let me quote some figures. During our years in office, there was an average increase in the net income for pensioners of 64 per cent. on top of inflation. Total public spending on pensioners as a proportion of gross domestic product was higher in our last year of office than it is under the present Government. During our time in office, there was a reduction in the number of pensioners dependent on means-tested benefits. Compared with the present Government, what we achieved is a jolly sight better. Pensioners are suffering.

Mr. Hope

Will the hon. Gentleman give way?

Mr. Willetts

No. I will get on. I will not waste any more of the House's time on that matter.

The claim that it is all to do with targeting the money better does not stack up. The real reason why we have all those special gimmicks lies at the door of 11 Downing street. It is all to do with the Chancellor.

This is a Chancellor who, a week or two before any Budget or any major economic statement to the House, suddenly thinks "I need a gimmick. I want a special scheme. I need to announce that I am transforming the tax and benefit system." No Budget statement is complete without a radical change to that system.

We have debated already the impact of that on families. We have the working families tax credit, the child care credit, the children's tax credit, the integrated children's credit, and the employment credit. The Chancellor called the Budget that introduced all that lot a Budget for stability. I do not know what a Budget for a bit of change would look like.

When it comes to pensioners, the Chancellor does the same thing. We have a different scheme, changes in the rules on entitlement, different amounts of money. It is unfair on pensioners, who want simplicity and reliability. They do not want Labour gimmicks.

Mr. Hope

Will the hon. Gentleman give way?

Mr. Willetts

I do not think so; no.

Hon. Members

Give way.

Mr. Willetts

Oh, all right.

Mr. Hope

I am grateful to the hon. Gentleman for giving way. Quite clearly, he is prepared to answer questions about his own policy. Is he prepared to accept that the criminal act that he is announcing as part of his policy entails walking up to pensioners, taking out their wallets or purses, taking money that has been given to them by this Labour Government, putting that money into an envelope, and giving it back to them? Does he also accept that that cons no one, particularly not the pensioners in my constituency, and that it would not make the poorest pensioners a single penny better off?

Mr. Willetts

Even if there were not a single extra penny for pensioners in our package, it would still be the right thing to do—because it would be part of the guaranteed, contributory basic pension, instead of all those complicated gimmicks. Actually, however, we are putting £320 million extra on top of the Government's provision and financing that by making savings elsewhere in social security. Nevertheless, even if we were not making that extra provision, our package would still be the right thing to do, because pensioners want the money as part of a guaranteed, weekly entitlement.

Mr. Andrew Dismore (Hendon)

rose

Ms Claire Ward (Watford)

Will the hon. Gentleman give way?

Mr. Willetts

No. I want to make a bit more progress, and then I shall give way to the hon. Lady.

I do not want to leave the impression that all the blame is being heaped on the head of the poor, wretched Chancellor. [HON. MEMBERS: "Why not?"] Because the blame has to be shared between No. 11 and No. 10 Downing street. The Prime Minister cannot be allowed to escape responsibility for the situation. Pensioners are so angry about the 75p increase not only because of its financial effects, but because of what it tells them about new Labour and new Labour's attitude to older people. One pensioner said that the Prime Minister thinks people like me are old has-beens, who aren't important or glamorous, people who they think can go to the back of the queue. The quote describes new Labour's modernising, young Britain attitude to pensioners. The Government have no respect for pensioners and no understanding of them, and that is why they have made such a mess of their pensions policy. That attitude goes to the heart of the Government. That is the attitude of the Prime Minister and those who surround him.

Mr. Dismore

Will the hon. Gentleman confirm that the effect of his proposals on a pensioner's income would be a change of 42p per week?

Mr. Willetts

All pensioners will be better off under our proposals. Even if there were not a single extra penny, as I said, it would be the right thing to do; but there are gains for pensioners on top of that. The size of the gains will depend on the personal circumstances of the pensioner. They will vary also because the schemes that our proposals will replace are so complicated. We are providing a reliable weekly payment instead of all the special schemes.

Ms Ward

Will the hon. Gentleman give way?

Mr. Willetts

No; I want to get back to the point that I was making about the Prime Minister.

We know from the people surrounding the Prime Minister what Labour really thinks of pensioners.

We know what the Secretary of State for Northern Ireland said at a private meeting. The Sunday Times reports: Mandelson appeared to have written pensioners off as a group who were not worth cultivating. He said that there was "no mileage" in them.

The chairman of the parliamentary Labour party, at the same meeting, is alleged to have said that pensioners are "racist". I do not know whether that is true, but it is certainly true that—as he said—they are "predominantly Conservative". We certainly know that that is true.

Ms Sally Keeble (Northampton, North)

Has the hon. Gentleman seen the most recent edition of Age Concern's magazine, which states that my hon. Friend the Member for Ealing, Acton and Shepherd's Bush (Mr. Soley) said nothing of the sort? That was stated in the pensioners' own publication—which the hon. Gentleman, like me, should have received this morning.

Mr. Willetts

I thank the hon. Lady. I am grateful for that point, which I shall consider carefully.

Let me just deal with something that seems to epitomise the new Labour approach to pensioners and why, at No. 10, they have got it so catastrophically wrong and are so out of touch with the views of pensioners across the country.

There is a report entitled "Ministers want trendy name for pensioners", which states: Ministers want to "rebrand" pensioners with a trendy name that will appeal to younger people … Ministers believe words like "pensions"— perhaps that is why they do not put them up enough— or "elderly" carry a grey imagine which deters younger people from thinking ahead. So, what have Ministers done? The report states: Some of Whitehall's finest minds are working on the problem, while the Government is also seeking outside help to try to come up with a new title. While the Government's finest minds have been thinking about the naming of pensioners, Conservative Members have been thinking about how we can help pensioners. Our package is about substantial increases in the basic state pension.

Ms Ward

Does the hon. Gentleman really believe that is the right thing to do and that it will benefit pensioners? Is he suggesting that he will increase the amount of money that will go to pensioners year on year? If he is, perhaps he will tell us where that money is coming from.

Mr. Willetts

The increase in the basic state pension will be part of that pension, and uprated in line with prices thereafter. That is the right way to do it, and we make no apology.

As there are some Labour Members in the Chamber, I shall briefly clarify our position for a few of them, so that when they are in their constituencies they do not perpetrate the lies about our policies that have been perpetrated over the past 10 days.

Several hon.

rose—

Mr. Willetts

No, I shall not give way. I want to make some progress.

Two important points were made clear in the original announcement by my right hon. Friend the Leader of the Opposition. They relate to two understandable concerns of pensioners, which were tackled at the beginning when we announced our policy. First, there is the concern—I understand the basis for it—that the special payments are tax exempt and the basic state pension is taxable. Some pensioners have asked, "Does that mean that we shall pay more tax as a result of this proposal?" It is not our intention that the proposal should include some special behind-the-scenes arrangement to collect more tax from pensioners. We do not believe in stealth taxes and it is the Government who have introduced them, not us. That is why my right hon. Friend said in his original statement: We would also adjust tax allowances for older people to compensate pensioners for any extra that they might otherwise pay. It is not the purpose of our proposal either to increase—[Interruption.] There is no increase or reduction in tax. The tax position will be unaffected and neutral.

Secondly, the Secretary of State has claimed recently—perhaps it is one of the reasons why the Prime Minister received the slow handclap by the Women's Institute when he tried to make the same point, but I do not know whether he managed to deliver that part of his prepared speech—that 2 million of the poorest pensioners would lose out because they would have an offsetting reduction in their entitlement to means-tested benefits.

The package is clearly costed, simple and straightforward. There is no messing about. It is costed on the basis that the money will go to all 10.5 million pensioners. There are no offsets or reductions in entitlement to means-tested benefits. Again, I shall quote the original statement, which says that we would adjust means tested benefits to ensure that the poorest pensioners gain at least as much as other pensioners. That has been clear all along. The Secretary of State should stop pretending that he does not know that that is our policy.

Dr. Lynne Jones

Will the hon. Gentleman put his hand on his heart and tell the House that had the Government not put in extra money for pensioners, he would still be advocating his proposal—in a way, very welcome—to increase the basic state pension? Furthermore, the next time that we have low inflation—as a result of the state pension being linked to inflation, the result is an increase of the state pension by a paltry few pence—will he argue that he will increase the pension by more than those few pence?

Mr. Willetts

I think that hidden in that intervention there was a tribute to the wisdom of the Conservative policy on pensioners. I shall take that in the spirit in which it was intended.

As in so many areas of policy, we are clearing up a mess that was created by the Government. They are the people who have created muddle and confusion. They make the benefit system more complicated every time that they make a new statement and introduce a new policy. We are offering pensioners respect for their ability to manage their own money and their own entitlements in the way that they wish. We are offering them the dignity of an entitlement to a contributory benefit. The Prime Minister was rumbled yesterday, and the Secretary of State has been rumbled. Pensioners have rumbled the Government.

1.50 pm

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

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof: 'condemns the Opposition for making no commitment to the welfare of either today's or tomorrow's pensioners, opposing every step the Government has taken to help pensioners and producing proposals for next year's basic pension uprating which amount to bribing pensioners with money which is already theirs; recognises the legacy of increasing pensioner poverty left by the last Government; applauds the Government for doing more to help all pensioners, spending £6½ billion more than planned by the last Government, but most for those who need help most by concentrating half the additional money on the poorest quarter of pensioners; congratulates the Government for tackling poverty directly with the Minimum Income Guarantee, helping take-up through better publicity and simplified claims procedures; supports the Government's plans to help those pensioners who just fail to qualify for the Minimum Income Guarantee by raising the capital limits to 12,000 from April 2001 and committing itself to bringing forward proposals for a Pensioner Credit which will reward thrift; congratulates the Government for helping all pensioners with their costs, including Winter Fuel Payments and free television licences for people aged 75 and over; and applauds the Government's strategy for ensuring that, in the future, nobody who has put in a lifetime of work or caring need retire onto means-tested benefits, including a commitment to the basic state pension, a state second pension which does more for 18 million people including those on low and moderate pay, with caring responsibilities or broken work records because of disability, and new flexible, low cost, stakeholder pensions.'. What was rumbled within hours of its announcement was the Conservative policy on pensions. It did not stand much examination before it became perfectly obvious that the Conservatives, having opposed every extra penny that we were spending on supporting pensioners, were taking that money and offering to spend it in a different way. There was no new money. The public and the rest of us should beware of Tories bearing gifts, because we have some experience of what happened during the 18 years that they were in government. They were not noticeably the pensioners' friend or on the pensioners' side. They left 2 million pensioners living in poverty. The gap in incomes between the better-off and the poorest pensioners was as great in 1997 as it had been 40 years earlier, and one third of people working today were heading for a retirement in which they would be dependent on benefits from day 1 because of inadequate second pension provision. Of course, we also all remember the millions of people who wore this-sold personal private pensions—something that the Conservatives encouraged when they were in office.

Today we have heard the first big idea from the hon. Member for Havant (Mr. Willetts). The Conservatives are trying to bribe pensioners with money that they were going to get anyway from the Labour Government. The Conservatives ate giving money with one hand and snatching it away immediately with the other.

Let us look at what the Tories are promising this time. I remember taking part in an interview with the hon. Gentleman on flu "Today" programme on the morning of his great announcement. He said that he was going to give £5 more to single pensioners. It did not take long to find out how he had reached the sum of £5. It is quite easy: £3 from the winter fuel payment, which we introduced and the Conservatives opposed, plus at least £2 from the inflation increase. The hon. Gentleman is trying to tell pensioners that he has £5 of new money, which he knows full well they were going to get anyway.

However, the hon. Gentleman's policy did not last for very long before it began to fall apart. When I heard him say that the House of Commons Library had helped him, I began to get suspicious. During the 13 years that I have been in the House, I have often found that when people start praying in aid the House of Commons Library, it is as well to see exactly what the Library said. As we know, it is a reputable and scrupulously impartial research organisation.

I asked the House of Commons Library—or, to be absolutely accurate, because I do not want to mislead the House, I got my parliamentary private secretary to ask the House of Commons Library—what it had said to the hon. Gentleman. The researcher said: Taking into account his proposals to abolish Winter Fuel Payments, free TV licences for the over-75s, and the Christmas Bonus these increases would leave single pensioners under 75 £0.42 per week better off. There we have it. Within hours of the announcement being made, it turns out to be not £5, not £7 and not £10, but 42p. That is what the Tories are promising pensioners. The Tories should bear in mind the fact that one reason they lost office after 18 years was that people did not believe a word that they said. Today we have heard yet another attempt to con people into believing that the Tories are offering more money, when the truth is that they are offering 42p. As the Library I helpfully goes on to say: No account is taken of income tax effects. The figure also fails to take account of the fact that many pensioners will lose benefits.

Mr. Patrick McLoughlin (West Derbyshire)

I should like the Secretary of State to clear up what he has just said, for the sake of accuracy. Did he say that he asked his PPS to ask the Library to provide the same information that was provided to my hon. Friend the Member for Havant (Mr. Willetts)? Is he aware that the Library is usually very strict in how it presents information to individual Members? If the Secretary of State is saying that the information that was given to my hon. Friend by the Library was also given to his PPS, I hope that he is misleading the House.

Mr. Darling

I do not know the proper procedure for this situation, but I am more than happy to place in the Library the information that my PPS—my hon. Friend the Member for Stockport (Ms Coffey)—obtained. It was a proper inquiry, and before the hon. Gentleman gets on his high horse, he should remember that when the Tories were in government they frequently asked the Library what information it had provided to Opposition Members.

The letter starts by saying: You asked about David Willetts' plans for increases to the Retirement Pension, which he has stated as being based on work by the House of Commons Library. It continues by making the point that the answer is 42p. Lest the Tories think that I am being unreasonable, or that the Library was being unreasonable in telling us what it has done, I shall explain why the sum of 42p has some credibility. About five hours after the hon. Member for Havant appeared on the "Today" programme, his colleague the shadow Chancellor appeared on "The World at One". [HON. MEMBERS: "Where is he?"] It is no wonder that he is not here, because I am about to tell the House what he had to say. When he was asked about the policy, which hon. Members will recall had been spun across every newspaper the night before, he said: We are making quite a limited announcement today. He was certainly right about that. He continued, with refreshing candour: We are not over selling this at all; it is a one-off policy. Of course it is a one-off policy, because there is no way that, with their tax guarantee, the Tories can find more money for pensioners in the future. The shadow Chancellor went on to say: It is money which is already being spent. We have had smoke and mirrors from the Tory party.

The shadow Chancellor made other revealing points, which bring me on to the point made by the hon. Member for Havant about losers. Under the hon. Gentleman's proposals, some 2 million of the poorest pensioners would lose out because the Tories will not give an undertaking to increase the minimum income guarantee in line with earnings. Indeed, the Tories are against the minimum income guarantee, or at least they were until two weeks ago. The shadow Chancellor was revealing on that point, because when he was asked about an extension of the MIG and whether it would, in time, be linked to earnings, he said: You are leading me now into a policy area in which we haven't yet made a statement. He continued: all other announcements about our attitude towards pensions and the minimum income guarantee and so on are a matter for the future. There we have it. The shadow Chancellor made it clear that the Tory party was performing a smoke and mirrors trick, by promising money that was already being spent. He said that it was not a big deal, because the net effect, after all was said and done, was 42p extra.

Mr. Willetts

rose

Mr. Darling

I shall give way to the hon. Gentleman, because I notice that he said on a subsequent television appearance when he was asked about the minimum income guarantee: In the long term, how you uprate the value of income support, the minimum income guarantee, is indeed a matter for decision. Perhaps he will tell us his decision now.

Mr. Willetts

The Secretary of State well knows that he has made no commitment to guarantee the earnings uprating of the minimum income guarantee beyond the life of this Parliament. I ask him to endorse the statement in his pamphlet entitled "Are you just getting by when you could be getting more?", which is the latest guide for pensioners. It describes the minimum income guarantee as the name we give to Income Support for pensioners. It is our old income support for pensioners that the Government have just renamed after a Soviet fighter aircraft.

Mr. Darling

If that is the best that the Tories can do, pensioners will soon see what the Tory party is all about.

We have increased the amount of money that goes to the poorest pensioners, because—as I said at the outset of my speech—one of the problems we inherited was the fact that 2 million pensioners were living in poverty, and no decent society should tolerate that.

Mr. Bercow

Will the Secretary of State give way?

Mr. Darling

I will in a moment. I am coming to a subject that I have no doubt is near to the hon. Gentleman's heart, but for entirely the wrong reasons.

The hon. Member for Havant has said that he will save money elsewhere in the social security system. We know that the Conservatives would scrap the winter fuel bonus, free television licences and the Christmas bonus, but they have two other proposals as well. They would raid the social fund, from which money goes to people who are absolutely poor and sometimes destitute, and scrap the new deal for lone parents—and all for 42p.

Shona McIsaac (Cleethorpes)

My right hon. Friend said that the Opposition plan to scrap the winter fuel allowance. Does he agree that that would be very serious, as men between 60 and 65 would lose an allowance that has just been extended to them? The Tory proposals would not give any extra help to that group of people, who would be much worse off if they voted Conservative.

Mr. Darling

My hon. Friend is right. When the Conservatives announced the 42p increase proposal, they were less keen to emphasise that they would scrap measures that help many people in this country.

With regard to the new deal for lone parents, we have been able to spend £6.5 billion more on supporting pensioner incomes in part because we have cut the bills of economic failure, as we promised to do at the general election when we inherited high levels of unemployment. One of the ways we have achieved that is through the new deal for lone parents.

Last week, the hon. Member for Havant announced, for I think the third time, that he would scrap the new deal for lone parents. The Government are acting to cut the numbers of people who are out of work but could be in work. So far, 150,000 people have joined the new deal for lone parents, and 50,000 of them have found jobs. In addition, nearly 15,000 have gone into education or training. The cost of that is £1,300 a job, or about 10 weeks' worth of benefit. The programme helps people get into work.

The Conservatives plan to scrap the new deal for lone parents and to remove income support the minute a child reaches the age of 11. After that, there would be absolutely nothing. The hon. Member for Havant should remember that another legacy of the previous Conservative Government was the more than 1 million lone parents on benefit. At Tory party conference after Tory party conference, in order to give delegates some cheap thrills those lone parents got nothing but abuse.

Mr. Graham Brady (Altrincham and Sale, West)

Will the Secretary of State confirm that only about 5 per cent. of those invited to take part in the new deal for lone parents have emerged from the programme with a successful conclusion? What estimate has he made of the percentage of those lone parents who would have got jobs without the intervention of the new deal?

Mr. Darling

First, 90 per cent. of people who are eligible join the new deal. From next April, a condition of receiving benefit will be that all lone parents—and several other categories of people—must take part in compulsory interviews for training. The economy has 1 million vacancies, and there are 1 million more jobs than existed when we took over government. We are determined to ensure that every one who can work should work. We are achieving that through active intervention in the labour market because we know that, left to its own devices, the market provides no help at all.

Mr. Bercow

rose—

Mr. Darling

I had better give way to the hon. Gentleman before he gets too excited.

Mr. Bercow

The breakdown of the NIRS2 computer system deprived hundreds of thousands of pensioners of their just entitlements. Fully 21 months have passed since the Secretary of 5 State told the House that the matter would be sorted out within weeks. Will the right hon. Gentleman confirm that 280,000 pensioners are still waiting for their rebates, and that £140 million of compensation has still to be paid?

Mr. Darling

The hon. Gentleman is wrong on one point. The computer did not break down—it never worked in the first place, and the bill for that should be sent to Conservative central office. [Interruption.] The hon. Gentleman was daft enough to raise this matter, so I shall tell him that the contract to replace the national insurance recording system was entered into in 1995, and had to be completely rethought a year later. When the time came to switch the computer system on, it did not work. It was yet another mess that we had to clear up. The position has now been stabilised, no one is losing their money and we are clearing up the mess that the Conservative party left us.

Mr. Brady

Will the Secretary of State give way?

Mr. John Greenway (Ryedale)

Will the Secretary of State give way?

Mr. Deputy Speaker

Order. I hear shouting from both Back Benches. Right hon. and hon. Members cannot do that—they must listen to the Secretary of State.

Mr. Darling

That is very good advice, Mr. Deputy Speaker. I will give way to the hon. Member for Ryedale (Mr. Greenway) now. Why not?

Mr. Greenway

This is a very serious point. I want to bring the Secretary of State back to the intervention of the hon. Member for Cleethorpes (Shona Mclsaac). It was my constituent, Mr. John Taylor, who took the Government to the European Court of Justice over the winter fuel payments for men over 60. I resisted the notion that this was a good idea. Will the Secretary of State tell me whether, but for the court case, the Government would have extended the winter fuel payment to men over 60, and whether doing so represents good value for money for the social security budget?

Mr. Darling

The hon. Gentleman can tell his constituent that we will be giving him the money but the Conservative party will be taking it away. I am sure that that will be a great comfort to him.

Mr. Greenway

Will the Secretary of State give way?

Mr. Darling

No, I have already given way to the hon. Gentleman. [Interruption.] Look how excited the Conservatives get once we expose their policies for what they are.

Mr. Gerald Kaufman (Manchester, Gorton)

My right hon. Friend has demonstrated that to make this bogus pensions increase offer, the Conservatives have been recycling money already spent. Is it not also interesting that the Conservatives have recycled Front Benchers and Whips on to the Back Benches to intervene, in an effort to disguise the fact that hardly any of their MPs have bothered to turn up for what they say is a major issue? It is their debate.

Mr. Darling

I understand that that is indeed the case. If the Conservative party policy was so good, surely some Back Benchers might have turned up to cheer on their colleagues. Instead, we have the unpaid payroll vote sitting behind them. Now I want to make some progress.

Scrapping the new deal for lone parents would be a false economy. If we allow more and more people to remain unemployed, there will not be money for the health service, pensions or anything else. The hon. Member for Havant was desperate to make his sums add up. He needed to raid something else from the social security budget, so he went for a measure that would be entirely self-defeating, as well as raiding the social fund. The social fund is necessary because, unfortunately, there are people who have no money and could be destitute. Presumably the Tories would just say to them, "Tough luck."

The House of Commons Library has confirmed that as a result of the hon. Gentleman's proposals, the best that a pensioner could hope for would be 42p—before tax, of course. However, he forgot to mention that his party also has an interesting policy with regard to pensioners and the national health service—with their 42p, they would have to fund expenditure that is presently free on the national health.

The Conservatives' health policy is that hip and knee replacements and hernia and cataract operations should be covered by private medical insurance. This is an extraordinary turn of events. As my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) said, there are a lot of Front Benchers sitting opposite but here they are, trying to distance themselves from their party's policy.

I thought that it would be interesting to find out exactly how much those operations would cost. I looked at information from BUPA and other private health care providers, and found that a cataract operation costs between £1,800 and £2,400. A knee replacement—

Mr. Brady

Will the Secretary of State give way?

Mr. Darling

Perhaps we have a BUPA salesman here who will tell me how much it will cost.

Mr. Brady

I am sorry to disappoint the Secretary of State, but I am not a BUPA salesman. However, he ought to realise that the Labour Government are the private health industry's best ever salesmen. Since they took office, 150,000 people have been forced to pay for their operations because NHS waiting lists are so long. That is happening under the right hon. Gentleman's Government, not under the Conservatives.

Mr. Darling

We are actually increasing spending on the NHS by a third—something the Conservatives oppose. Obviously, the matter causes the Conservatives much distress. However, at the next election, when our two parties set out their stalls before the electorate and the Conservatives say they will give pensioners 42p more on their pension, I hope they will also say that, under their proposals, according to their health spokesman, conditions such as hip and knee replacements, hernia and cataract operations should be covered by private, medical insurance. If people do not have £7,800 for a hip replacement, they will have to try to get insurance for such conditions—but just try to do that as a 60-year-old.

What we have from the Conservative party is a complete con. It should surprise none of us, because they tried to con people for 18 years before they were finally rumbled.

Dr. Stephen Ladyman (South Thanet)

It may have escaped my right hon. Friend's attention that, when it was cold enough for long enough—usually when it was too late—even the Tories used to make some cold weather payments. Are they not now proposing to scrap the winter fuel allowance without making any compensatory arrangements for the cold?

Mr. Darling

All of us who are familiar with the cold weather payment scheme were struck by the fact that it had to be cold for an awfully long time before it was triggered. The nature of the British climate made that quite difficult. One did not receive much and when one did, it was long after the event.

The advantage of the winter fuel payment is that it is tax free; it is not taken into account for benefits and it arrives just at the time when pensioners begin to worry about whether they can turn up the heating. That is not something that has ever bothered a large number of those from whom we are hearing this afternoon.

Mr. Ian Davidson (Glasgow, Pollok)

The Secretary of State is correct to dismiss the cynical approach of the Tories, but does he agree that the benefits that we are providing could be better targeted? I draw to his attention the fact that recent studies from Bristol university show that only 51 per cent. of people in my constituency are expected to live until they reach the age of 75, whereas in Eastwood the figure is 66 per cent. and in some of the better-off parts of England it is more than 70 per cent. That means that free television licences, targeted at the over-75s, actually miss out half the people in my constituency—[Interruption. They will die before those licences are available. Would it not be better to re-target the provision at those in greatest need?

May I say that I was very glad—

Mr. Deputy Speaker

Order. The hon. Gentleman has certainly been able to say a lot during an intervention.

I call Mr. Secretary Darling— [Interruption.] Order. Before I call the Secretary of State again, I appeal once more to hon. Members. We cannot have shouting across the Floor of the House— [Interruption.] Order. I am not addressing my remarks only to the Opposition, but to all hon. Members. We cannot have shouting across the Floor of the House.

Mr. Darling

I think my hon. Friend the Member for Glasgow, Pollok (Mr. Davidson) would readily admit that not all his constituents die before the age of 75. However, the report to which he referred identifies the problems that occur when people are born into low-income households and live on low incomes throughout their working life. As sure as night follows day, they will die on a low income. That is precisely why the Government have introduced a range of strategies to increase the amount of money going into households with children. That is why we increased child benefit by so much and why we are introducing the integrated child credit. We are helping parents into work through the working families tax credit and a variety of means—all of which are set out in our annual report "Opportunity for All" and all of which are opposed by the Conservative party.

That leads me to another point I wanted to make. The contrast between the Labour Government and the Conservative Opposition is that we are tackling the problems we inherited, some of which had not developed during the previous 18 years but had been around for longer than that. However, if we do not sort them out, we shall prolong a wholly unacceptable situation.

First, we need a pension strategy so that in future everyone can retire on a decent income after a lifetime of hard work. Secondly, we must ensure that pensioners do not live in poverty. That is why we are spending an extra £6.5 billion on pensioner incomes during this Parliament£2 billion more than it would have cost to restore the earnings link. It is important that half of that £6.5 billion will go to the poorest third of pensioners. We are spending more because we believe that we should be doing so and, as a first priority, we are spending that money on those pensioners who need it most.

As a result of what we are doing, all pensioners will be £3 a week better off because of the winter fuel allowance. The free television licence for the over-75s is worth a further £2 a week. However, because we want to tackle pensioner poverty, we are ensuring that the poorest pensioners, who receive the minimum income guarantee, will have at least £8.40 a week more, and up to £10.65 a week more for the oldest. That makes them better off than under the Tories—£8 and £10 a week better off, with more than that for couples. That money is over and above inflation. It is a real gain for those people.

I make no apology for making that our first priority. It is quite wrong that, at a time when many people retire with a good state second pension or an occupational pension, other people still live on a pension that is lower than income support. That is why we increased pensions by so much for the 1.5 million pensioners who lost out as a result of the situation we inherited.

Mr. Laurence Robertson (Tewkesbury)

rose—

Mr. Geoffrey Clifton-Brown (Cotswold)

rose—

Mr. Darling

I shall give way to both hon. Gentlemen in a moment. I am conscious of the fact that it is their Opposition day, so I do not want to take up too much time, although even after their Whips and Front-Bench spokesmen leave the Chamber—I may be wrong, but I suspect that it will not be long before they do so—there may not be many Opposition Members who want to speak. However, just to show how generous I am, I give way to the hon. Member for Tewkesbury (Mr. Robertson).

Mr. Robertson

I am grateful to the Secretary of State for giving way to a humble Back Bencher. He must be the only Member who does not receive lots of communications from pensioners, all saying that they want not gimmicks but a decent pension. Surely, that is the basis of our proposal.

Mr. Darling

I have no doubt that the hon. Gentleman's Front-Bench team will have noted his plea not to remain on the Back Benches for much longer.

I will deal with his second point. What pensioners want any Government to do is to increase the amount of money available to them. However, many pensioners accept the fact that the first priority must be to deal with those pensioners who were living in absolute poverty as a result of the situation left to us by the Tories. The second stage is clearly to help those pensioners who have modest savings or modest amounts of capital and who also lost out under the Conservatives.

As a first step, we have doubled the capital limits. The Tories did nothing about that for most of the time they were in government. We have doubled the capital limits that entitle more people to receive the extra help they need.

For the longer term, we are ensuring that a system will be in place to enable people to build up a decent pension in future. It is worth noting that, in 30 years' time, nearly a quarter of the population will be retired. That is why we need proper debate and an understanding of the need to save more, so that people can retire on decent pensions.

Ms Keeble

Does my right hon. Friend agree that although the hon. Member for Havant (Mr. Willetts) said that he was going to talk about the future of pensions, he said nothing about that? He failed to address the pension needs of women, including the many women who work part-time, married women who have no pension rights of their own and those women who choose to stay at home and look after their families or disabled relatives and who currently lose their pension rights. Will my right hon. Friend say something about all that we are doing to support women—especially those who choose to stay at home and look after their families?

Mr. Darling

My hon. Friend's intervention is timely. The minimum income guarantee helps a large number of people who retired without a full contribution record and whose basic state pension is much lower than £67. The minimum income guarantee gives them help that was not available in the past, because the Conservative party was never that bothered about the matter.

Furthermore, we are putting in place pension reforms that will last in the longer term. When the basic state pension was introduced, it was always intended that people would have a second pension in addition—either from the state or an occupational or works pension. Indeed, one of the reasons that the average pensioner income is £132 at present—well above the basic state pension—is that many people are retiring on occupational pensions that they took out 20 or 30 ye are ago. That is why it has gone up. We want to add to that.

It has long been recognised that there never was a golden age in which the basic state pension was worth enough on its own. It has always been looked on as a foundation. One reason that the Labour Government of the 1970s introduced the state earnings-related pension scheme was that they recognised that both state and funded pensions had a role to play in increasing pensioner income.

The problem we have today is that, although many people have good occupational pensions, too many people have retired on the basic state pension alone or just above that.

Mr. Clifton-Brown

Will the Secretary of State give way?

Mr. Darling

No, because I want to make some progress

We have introduced the new stakeholder pension because it will give flexible low-cost pensions to nearly 5 million people who until now had nothing other than personal private pensions that were probably inappropriate for many of them. As has been said, we are reforming SERPS to give more security in retirement for 18 million people—carers and disabled people with broken work records—who did not receive enough help under SERPS.

I repeat the example yet again. Under SERPS, someone who earned less than £6,000 would get about £14 a week. Under the new state second pension, the sum rises to £54 a week. It is heavily redistributive— if I may use that term—towards those people who lost our in the past. We are helping pensioners today; we are tackling the appalling Tory legacy of pensioner poverty and we are also making sure that, for the future, people can retire on a decent income.

What we heard two weeks ago and what we have heard this afternoon—I notice that the hon. Member for Havant did not dwell too much on what exactly he was promising—have made the issue abundantly clear. As the right hon. Member for Kensington and Chelsea (Mr. Portillo), the shadow Chancellor, said the Conservatives' policy does not constitute a big announcement. Essentially, it amounts to 42p. The Conservatives seek to spend the same money that we are already spending. We are tackling pensioner poverty and ensuring that people can retire on a decent income. We are making sure that 18 million low-paid carers and disabled people receive more. We are rebuilding the NHS, not trying to shuffle pensioners into private care. We are spending far more than the Conservative party ever would or ever will. I urge the House to reject the main motion.

2.22 pm

Mr. Steve Webb (Northavon)

I am delighted that the Conservative Opposition have chosen the subject of pensions. We have spent much of the past three years wondering what they would do if they were in office, and we have now heard the first instalment. We have heard what they would do on day one, but we are still hazy as to what would happen after that.

As the Secretary of State for Social Security rightly pointed out—I heartily agree with him—42p will be the net benefit of the Conservatives' proposal. Where the Government will be associated with being the party of 75p for pensioners, the Conservatives, when they go into the next election, will be known as the party of 42p for pensioners. Although we have not finalised the Liberal Democrats' manifesto, I assure the House that our pledge on the basic state pension will substantially exceed 42p and 75p.

Mr. Bob Russell (Colchester)

That is why Ronnie is retiring.

Mr. Webb

Indeed, my hon. Friend the Member for Southport (Mr. Fearn) is looking forward to benefiting from our pledge.

The speech that we have just heard from the hon. Member for Havant (Mr. Willetts) and Conservative literature say different things to different people. [HON. MEMBERS: "Oh!"] I find that shocking. The Conservatives have put in their leaflets that 75p is inadequate for pensioners and the hon. Gentleman described the sum as paltry. However, when I challenged him on 7 February and asked him what he would do if he were Secretary of State, he said: We would carry on increasing the basic pension in line with prices.—[Official Report, 7 February 2000; Vol. 344, c. 33.] In other words, the increase would have been 75p if he had been in power. Today, he said that, once the Conservatives have given pensioners their own money back in a different way, the pension would continue to be linked to prices. As I understand it, that is the Conservatives' policy

If pensioners vote Conservative, they will receive the money that they are getting already delivered in a more sensible way, and I have no problem with that. I have made that point in the House on several occasions. Long before the hon. Gentleman said that the Conservative party had no plans to remove the winter fuel payment, I asked whether it was an administratively sensible way to provide the money, given that it costs £10 million to £15 in administration costs.

My hon. Friend the Member for Kingston and Surbiton (Mr. Davey) received a letter from a constituent saying: Dear Ed … I have an Honours Degree from Cambridge and was an Under Secretary in DHSS. I find the page of "Winter Fuel Payment Notes" just about as dense a 600-700 word essay as one could imagine. And yet I am required to sign that I have read and understood the leaflet. Those notes are just one example of the bureaucracy involved in the system.

I have no problem with the principle of delivering money to pensioners through the basic pension. We have been consistent on that point. Our amendment on the Order Paper objects to the pretence that, by voting Conservative, pensioners will receive £5 of new money that will make them better off, and not just by 42p

Mr. Willetts

We are making a bit of progress. Faced with the choice simply between what is happening under this Government's proposals and our proposals for the consolidation of the money, which does the hon. Gentleman think is better?

Mr. Webb

The Conservative party's package contains several elements. The first is to pay the winter fuel payment through the pension, and I do not have a problem with that. However, we do not support the abolition of the free television licences for those aged over 75 or the abolition of an age addition.

Ms Keeble

I appreciate the hon. Gentleman's criticism that the Conservatives' policy means all sorts of different things. I looked up the Liberal Democrats' policy on their website and clicked on the word "policy". The page that flashed up said "No documents."

Mr. Webb

The hon. Lady is very welcome to check my personal website.

The critical point is that—to coin a phrase—pensioners were not born yesterday. They can see through the Conservative party's offer, which will mean that they would get back their own money.

Ms Ward

I appreciate the comment of my hon. Friend the Member for Northampton, North (Ms Keeble). However, let us consider traditional manifestos that are set out in writing. If I recall it correctly, the Liberal Democrats' policy at the last election was to retain the basic state pension's link with prices. Have they now changed their policy? The policies that they expound in the House are very different from the ones that they expound outside.

Mr. Webb

If the hon. Lady attended debates on pensions a little more often, she would know that, for some years, we have advocated a better deal for pensioners than that contained in our previous manifesto. Politicians are often criticised for failing to live up to their manifesto promises. I doubt that a single pensioner in my constituency will criticise me for doing more than I promised when they elected me. I suspect that they will welcome that.

Miss Julie Kirkbride (Bromsgrove)

In the interests of his constituents in Northavon, will the hon. Gentleman spell out exactly how much better off they would be if, by some extraordinary fluke, the Liberal Democrats won the next election?

Mr. Webb

The Conservative party makes policy in an intriguing way.

Miss Kirkbride

I asked about the Liberal Democrats' policy.

Mr. Webb

I will explain our policy to the hon. Lady. However, when a new Conservative shadow Chancellor took over, he reversed within a few days substantial tranches of party policy. That is not how the Liberal Democrats work. Our policy is determined at our conference by the delegates. We have just completed a policy document, "Policies for an Ageing Population", which contains proposals for substantial increases in the basic state pension across the board and particularly for older pensioners. We have advocated that for a long time, and the Conservatives will now have to vote for that to facilitate their proposal for an extra £2 for the over-75s. They were ambivalent about that move, but now have to support it to implement their policy. We shall vote on our proposals at our September conference and they will become party policy. That policy will be published in the coming few months, so the precise figures, together with a statement of where the money will come from, will be available.

Mr. Darling

The hon. Gentleman mentioned extra money for older pensioners. Does he recall that he proposed to fund that by dismantling SERPS?

Mr. Webb

No, that is not how we propose to fund it. If the Secretary of State contains himself for a few weeks, he will be able see our proposals in a policy document which explains where the money comes from, although that will not be from the abolition of SERPS. By contrast, the Government stood on a manifesto that said that SERPS would remain for those who wanted it, but the right hon. Gentle man is abolishing it.

The key point is that if the Conservative party were in office, it would give pensioners the 75p that they deride as paltry. It has sought to make political capital out of that 75p, but pensioners have long memories and know that they would let nothing better from the Conservatives. It is not just their record in this Parliament that we have to worry about—we must also examine the record of 18 years of Conservative Government, which sends a clear signal about why pensioners do not trust the Tories on pensions.

In 1980, the Conservative Government broke the earnings link. The hon. Member for Teignbridge (Mr. Nicholls) commented on that link and rewrote history by implying that it had never been properly honoured. However, the history of the pension shows that its real value increased significantly relative to earnings in the 30 years after the war and that successive Governments, despite difficult economic situations, did more than simply retain the earnings link. I therefore reject the suggestion that, in a relatively prosperous nation, the link is totally unaffordable.

The Conservatives broke that link, thereby allowing the basic state pension for each generation that retires to fall further behind what it received when it was in work. If the role of a pension is to help people maintain living standards from work into retirement, letting the basic pension lose touch with what people are earning, whatever the mechanism, means that the state pension fails to fulfil that role.

Conservative proposals on winter fuel payments would make no difference to pensioner incomes over the lifetime of a Parliament. Once the Conservative party had done that, what would it do next? If inflation was at 1.1 per cent., it would give pensioners 75p, so nothing would change for pensioners. I strongly suspect that the hon.

Member for Havant was influential in Conservative policy-making circles when the previous Government devalued the basic pension and slashed SERPS. The real value of SERPS entitlements was more or less halved in legislation in 1986 and halved again in the Pension Act 1995. That is the Conservative record on state pensions, which pensioners remember.

Mr. Desmond Swayne (New Forest, West)

The key phrase used by the hon. Gentleman was that the state pension was meant to help pensioners maintain their living standards. Does he agree that linking the pension to earnings would diminish the incentive for people to make additional provision, which was always the intention of the old age pension system under Beveridge?

Mr. Webb

The hon. Gentleman make a fair point. If we had only an earnings-linked pension and a price-linked means test, there is a risk that people would start to rely more on state pensions and less on their savings. However, we are not in that position, as we have an earnings-linked means test designed to ensure that today's poorer pensioners at least keep pace with the working age population. We do not oppose that. We do not oppose keeping those on income support out of touch with those of working age. However, doing that means that one cannot let the basic pension fall, which is the difference between the Conservative and Liberal Democrat positions.

The Secretary of State seemed to imply with a gesture that we had not said that before. Our criticism concerns letting the basic pension cut itself adrift from the means test, which creates the savings disincentive raised by the hon. Member for New Forest, West (Mr. Swayne).

Mr. Clifton-Brown

Does not that scenario give rise to the present problem? The Government's minimum income guarantee for pensioners is a minimum income guarantee only if those pensioners draw income support. It is disgraceful that any pensioner should have to rely on drawing any benefit to get a minimum income. That applies to some of the poorest pensioners in the land.

Mr. Webb

The hon. Gentleman has a short memory. For most of the period in which the Conservatives were in government, 1 million pensioners were getting income support, which is the same thing. The hon. Gentleman's party seemed to have no problem with that in office. Indeed, occasionally it made above-inflation increases to income support for pensioners in the same way that the present Government link it to earnings. The policy is the same, and the election did not bring any change to it. What was true when the hon. Gentleman's party were in office is certainly true now.

The critical point is that the Conservative package would be of negligible value to pensioners and they can see through it. Just as across the land the Secretary of State is known as Mr. 75p, the Opposition spokesman will be known as Mr. 42p. There may be a gain of 42p, but there would be a significant number of losers—to whom fleeting reference has been made, such as the men aged 60-64 mentioned by the hon. Member for Cleethorpes (Shona McIsaac) who think they will get the winter fuel payments, but in fact will lose them.

The motion for debate states that funding will come from abolishing the … New Deal for Lone Parents and elsewhere, which glosses over the £90 million or so that will come from the social fund. I should be happy to give way to the hon. Member for Havant if he wants to explain on what parts of the social fund he would draw. Would he draw on crisis loans for people whose domestic circumstances are in crisis and who need money for a desperate situation, or would he draw on budgeting loans for people on a pathetic income who need a few pounds to buy a cooker or fridge? Perhaps he would draw on funeral or maternity grants. What cuts would he make on the most vulnerable people in society? The motion is smoke and mirrors and does not explain how the Conservatives would find 42 pence for pensioners. That is what they are really about: they are attempting to deceive pensioners.

Shona McIsaac

The hon. Gentleman speaks about deceiving pensioners. If I understood him correctly, he does not support the winter fuel allowance, which the Liberal Democrats would get rid of. The Labour party is the only party to maintain the winter fuel allowance for pensioners and men aged 60 to 65. Those men would therefore lose out under Liberal Democrat policy.

Mr. Webb

There is no question but that we would honour existing entitlements—but the Conservatives would rip them up. However, it makes sense to feed those entitlements into the pension, as we have always argued. In the 60 to 64 group, people already expecting to get that payment, such as those in the income support category, should continue to do so. However, it is not necessarily sensible to keep that going in perpetuity. All existing promises, however, must be honoured.

Kali Mountford

Will the hon. Gentleman give way?

Mr. Webb

No.

The hon. Member for Northampton, North (Ms Keeble) mentioned married women and pensions. The Minister of State and I had an exchange in an Adjournment debate on the position of married women who pay the reduced rate of national insurance, many of whom are the poorest pensioners in the land. Indeed, one of them wrote to me recently because she was receiving a pension of 8p a week. I suppose that 42p would be good news for her, but that is not so for most pensioners.

Having examined the history of the matter, I learned that the Leader of the Opposition was a pensions Minister in about 1993, when nearly 1 million married women paid national insurance at the reduced rate and therefore depriving themselves of future pension entitlements. A significant number were wrongly advised to pay national insurance at the reduced rate. Some of them were on such low pay that they could have paid less national insurance if they had gone into the full system. However, the then pensions Minister failed to draw that to their attention. The Leader of the Opposition is therefore partly responsible for today's pensioners being on such poor pensions.

The Minister of State kindly invited me to offer him individual cases. I have written to every pensioner who has written to me, passing on that invitation so that they can respond through their own MPs. I am gathering information, and hopefully the Minister will also shortly receive information from pensioners throughout the land.

I shall not follow the precedent set by the hon. Member for Buckingham (Mr. Bercow) yesterday when he spoke for 45 minutes in a Liberal Democrat Opposition day debate. I shall shortly draw my remarks to a close, but first I shall set out the alternative Liberal Democrat vision for the basic state pension. Two or three key principles distinguish our approach from that of the Conservative party and the Government.

First, we believe that the basic state pension has a central role and there should not be additional money for gimmicks and schemes. To that extent, there is common ground. However, we believe that the pension has been allowed to fall much too far behind means-tested benefits. The basic state pension is just over £67 and the means test is worth £78, so there is already a yawning £11 gap, and by the time of the election it will be larger still. Our commitment is to reduce that gap and, to respond to the point made by the hon. Member for Cotswold (Mr. Clifton-Brown), our goal is to ensure that no pensioner over 75 has to rely on means-tested benefits such as income support.

Our goal is to raise the basic state pension with particular emphasis on older pensioners, who tend to be women, to be poorer and to have run down their savings. Our approach is universal in that all pensioners will receive the pension and will not have to be means-tested, but it is targeted because the pension will increase substantially with age and will therefore reach those most in need. That is the right balance, and the Government's obsession with means-testing and the Opposition's approach, which recycles existing cash, are not. Our targeted approach will ensure that pensioners most in need—those who are entitled to the means test but who do not claim the benefit—get the money to which they are entitled.

We believe that the pensioners of this country have been insulted once by being given 75p, and they will be insulted again if offered 42p by the official Opposition. Only one party at the next general election will pledge a substantial, real increase in the basic state pension, and pensioners know who their friend is.

2.42 pm

Mr. Gerald Kaufman (Manchester, Gorton)

Studying the subjects that the Tories have chosen for today's debates leads me to an inescapable conclusion: it took the Labour party 18 years of opposition to become fit to form a Government; on this form it will take the Tories a lot longer than that to become fit to form an Opposition.

For the second debate—obviously, Mr. Deputy Speaker, I shall not discuss that subject—the Conservatives have chosen genetically modified crops, a matter that divides the sovereign's consort from the heir to the throne, and the heir to the throne from the Princess Royal. Yet the Conservatives want to make political capital out of it.

For this debate, the Tories have chosen a subject on which their record is so appalling that one would think that they would never presume to open their mouths about it. The Opposition spokesman, the hon. Member for Havant (Mr. Willetts), in a speech that managed simultaneously to be both conceited and inadequate, told the House that he offered pensioners respect—and respect is all that the Conservatives are offering pensioners. Even if they offer that, we should remember that one of their Prime Ministers used to refer to the retirement pension as a "donation".

Let me make my position clear. I think that the Government were seriously mistaken to put up the pension by only 75p this spring. I have a right to say that because months beforehand, I wrote to my right hon. Friends the Prime Minister and the Secretary of State, telling them that it would be a blunder to bring in an increase of that size. Furthermore, although I welcome the free television licences for those aged 75 and over, I have said repeatedly that the policy should extend to all pensioners. So I have a right to tell the Government to do even better, while praising them for all that they have done for pensioners—the £150 winter fuel allowance, the £10 Christmas bonus, the free eye tests, the free TV licences for older pensioners and the cut in VAT on fuel.

The Conservatives do not have the right to utter a peep about pensions. We must remember that they legislated for the link between the basic pension and the prices index, and that is the basis for the 75p increase that the Tory leader has the nerve to denounce. In their 1997 manifesto, the Tories promised to continue to protect the value of the basic state pension against price rises. That is Hague-speak for "75p", which is all that the Conservatives would have provided this year.

By ending the link between pensions and pay in 1980, the Tories were responsible for the fact that today's pension is £31.40 a week less for the single pensioner and £50 a week less for a married couple. Ending that link meant that over their years in office the Tories stole £115 billion from pensioners, in return for which they are now offering 42p.

The Tories are now trying to make up for that, or at least pretending to do so, by promising a single £5.50 top-up on the pension. The hon. Member for Havant admitted this afternoon that that would be a once-and-for-all increase, before they went back to increasing pensions solely on the basis of the price index. As my right hon. Friend the Secretary of State has pointed out, the shadow Chancellor has admitted that the £5.50 top-up would not involve a penny of new money. It would all be paid for by money already committed, most of it to pensioners. This must be a first: the only self-financing bribe in the history of political peculation.

However, the situation is even worse than that because the £5.50 top-up would be for one year only, but the cuts—the end of the winter fuel payment, the Christmas bonus and the free TV licence for those aged 75 and over—would be for ever. If the Tories ever came to power, they would budget to spend far less money on pensioners than Labour does. They would not spend a penny more on the pensions increase, as they have admitted, but they would end the winter fuel allowance, which would save the Treasury £1,300 million a year. The end of the Christmas bonus would save the Treasury £85 million a year. The end of free TV licences would save £364 million a year. So in exchange for that self-financing bribe for one year, the Tories would take away £1,750 million, and rising, from pensioners every year.

Mr. Greenway

rose—

Mr. Kaufman

I shall deal with the hon. Gentleman in a moment; I have him well in mind.

On the one hand, there is 42p, with no new money, and on the other, £1,750 million will be taken from pensioners every year. No doubt if the Tories ever got the chance, they would give that money away to the top taxpayers who benefited during their years in office.

A funny thing about the free TV licence is that the Tory leader announced his intention to abolish it on 24 May, but only the day before, when the House passed the legislation facilitating the free TV licence, the Tory Front-Bench spokesmen were confirming their "warm, enthusiastic, welcoming support" for the measure. On 23 May, they said that free TV licences were wonderful; on 24 May, they said that they had to be abolished. That is not so much a U-turn as a hairpin bend. For reasons that I have always failed to understand, the hon. Member for Havant has been referred to as "Two Brains"—two faces would be a better description. Madam Speaker has ruled it out of order to describe the Conservatives as hypocrites. That is just as well, for hypocrite is too kindly an epithet to apply to that party.

The Liberal Democrats, from whom we have just heard, should rename themselves the lachrymose crocodiles. During last month's local elections, that grubby leaflet "Focus" sought to stir up discontent it my constituency about what the Liberal Democrats called the "75p pensions insult", but what is their policy on pensions?

The Liberal Democrat amendment states: the Conservatives have admitted that, had they been in office in April 2000, they would have increased the basic state pension by just 75p … True, but so would the Liberal Democrats. That was official Liberal Democrat policy, and it will remain so until the phantasmagorical document that the hon. Member for Northavon (Mr. Webb) endorses and promises will be published.

My hon. Friend the Member for Cleethorpes (Shona McIsaac) was unable to find the Liberal Democrats' policy on the website, but my hon. Friend the Member for Watford (Ms Ward) quoted it from memory. I do not need to quote their policy from memory; I looked it up in their 1997 manifesto, which states: The basic state pension will remain indexed to prices. That is Lib Dem-speak for 75p. The hon. Gentleman has admitted that that continues to be their policy until that wonderful document, for which we cannot wait, comes out later this year. No doubt—the Liberal Democrats being what they are—it will tell us not only what they would pay pensioners, but how they would pay for it in increased taxation, national insurance contributions, or both. A significant absence from all Liberal Democrat spending commitments is how they intend to find the money to pay for them. I shall return to that matter not in this speech, but in future speeches in the House, if I catch the eye of the occupant of the Chair.

Pensioners would have been worse off this year under Liberal Democrat policy, because the party had no policies to introduce winter fuel payments or free TV licences in its election manifesto. The Liberal Democrats battened on to those, but they are our policies, and—as my hon. Friend the Member for Cleethorpes said—ours alone. Not only would pensioners have been worse off this year under Liberal Democrat policy because of their 75p increase without a winter fuel payment or free TV licence, but the hon. Member for Northavon has admitted that they would have been even worse off. Using strange phraseology, he has said that the Liberal Democrats would honour the current commitments. I do not know what that means, especially as their intention would be to incorporate them into the pension. That would mean that the money would be taxable, as distinct from not being taxed as now. The hon. Gentleman has not committed his party to continuing the winter fuel payment as such. He sits there giving a twitch of his head, which I cannot interpret, but he is certainly not springing to his feet to deny what I say.

We have no guarantee whatever that the Liberal Democrats will continue with the free TV licence, even for over-75s. Furthermore, they claimed in one of their other "Focus" leaflets, which was circulated in my constituency, that the Labour Government would force pensioners to collect their pensions through bank accounts, although they knew—if they did not know, they should have done—that the Prime Minister personally promised that pensioners would continue to be able to collect their pensions from their local sub-post offices weekly and in cash. The "Focus" leaflets have turned lying and deception into such an art form that any minute now, the Liberal Democrats will apply for a lottery grant for them.

In a recent asylum debate, the hon. Member for Southwark, North and Bermondsey (Mr. Hughes) gave an undertaking, on behalf of my party, that we will seek to deal with any matter in our party that other people are concerned about.—[Official Report, 12 April 2000; Vol. 348, c. 447.] More than a month ago, I tabled early-day motions drawing attention to Liberal lies and deception, and we are still waiting to hear from the hon. Gentleman. The Labour party can and should do better for pensioners, and Labour Back Benchers will keep up their pressure for that better deal, but we will take no lessons on pensions, or anything else, from the opposition parties, which compete with each other in empty promises and political prestidigitation.

2.56 pm

Miss Julie Kirkbride (Bromsgrove)

I am especially pleased to follow my colleague, the right hon. Member for Manchester, Gorton (Mr. Kaufman), who is the Chairman of the Select Committee on which I serve. I have considerable respect for him, but on this occasion, he has used his formidable intellect to distort Conservative party policy on pensions. He suggested that we proposed to condense the winter fuel payment, the Christmas bonus and other payments made to pensioners into one weekly payment. He knows full well that that will not last for one year; it will be continuous. The increase in money that we will give pensioners will be sustained. That is more than the Government propose now because of the administrative savings and money from other Government programmes, which will be added to the overall amount that will be given to pensions.

Given the right hon. Gentleman's considerable intellect, I am surprised that he did not mention—perhaps because of partisan politics—that as well as pensioners receiving a higher weekly payment, on which future upratings will take place, the money will also be index linked in a way that I presume the £10 Christmas bonus and other payments have not been for some years. He distorts our party policy on such matters—[Interruption.]

Mr. Deputy Speaker

Order. The hon. Member for Colne Valley (Kali Mountford) must not interrupt the hon. Lady while she is speaking.

Miss Kirkbride

Thank you, Mr. Deputy Speaker. I am grateful to you for calling me after the right hon. Member for Gorton, so that I can swiftly put those matters right for the record.

I do not wish to speak for too long because this is, sadly, a short debate on an important policy matter which affects a huge proportion of our citizens, who clearly feel strongly given the amount of publicity and news attention surrounding pensions during the past few weeks. However, I am proud to stand on the record of what the Conservative party did for pensioners in our 18 years in office and what we propose to do. Sadly, our proposals are subject to distortion by Labour Members. They distort what happened to pensioners and their incomes during those 18 years.

A third of pensioners now have incomes that are in the top half of all incomes in the country. That is a considerable achievement, for which we deserve some of the credit in so far as we encouraged occupational and private pension schemes. I wish that more than a third of pensioners were in that position, but back in the 1970s and before, pensioners were almost universally poor. That is not so nowadays and they mirror the rest of the population: some are well off, some are fairly well off and, sadly, some, like other people, are poor.

It is Conservative Members' duty to point out that all pensioners, given their service to this country and their status as senior citizens, should be allowed to live in dignity and decency, and should have enough money to do so. I accept that all Members want to achieve that objective, although it will be expensive in so far as others will have to pay.

Kali Mountford

Will the hon. Lady give way?

Miss Kirkbride

I will, but I hope that the hon. Lady does not make more partisan points.

Kali Mountford

I am grateful to the hon. Lady for giving way on the point of pensioner poverty. Given that her party—and, it seems, the Liberals—does not support the £150 winter fuel allowance, I am intrigued to know how she would tackle the problems of those who have suffered from hypothermia in winter. That payment has made a significant difference to pensioners' use of heating over the winter months and could save lives.

Miss Kirkbride

I am sorry to have to say that the hon. Lady's question is extremely ignorant and completely misses the point: we propose to give pensioners that money weekly rather than annually. They will still receive it, so her point is ridiculous as it lacks any intellectual credibility whatever. I am sorry that I gave way.

I was developing the point that we improved pensioner incomes and increased income support for poorer pensioners during our 18 years in power. The Government have introduced measures on similar lines, but given them different names. For example, they call family credit the working families tax credit. On the whole, the policies are similar and, in a civilised society, it is right and proper to help poorer pensioners. I take great comfort from the fact that many people drawn from the spectrum of 10.5 million pensioners—getting on for 20 per cent. of our citizens—can live out their lives in some financial security. That is good news on which we want to improve. To that end, the Government have a case to answer.

We all accept that pensioners' incomes are vulnerable because they can no longer work. They are not in the marketplace and feel insecure because they are unable earn more—their incomes are static. People fortunately live longer, but inflation may erode the money that they receive, which is a worry. Therefore, it was extremely mean of the Labour Government to create a position in which pensioners can no longer get back the tax on their dividends. That smacks of the class envy that we have seen in the past few weeks.

Pensioners who happen to have a few shares in British Gas, BT or any other stock portfolio are not necessarily rich. The tax that they get back is a significant part of their income and they are entitled to it, especially given the vulnerability of their income position. It was mean and spiteful of the Government to stop pensioners claiming back their tax, and that measure contrasts markedly with the new proposals for the tax regime: whereas the tax man would have taken £40 million from a dot.com multi-millionaire who made a profit of £100 million, fat cats, as the Government used to call them, will now be able to keep £90 million and hand the Treasury just £10 million. That sits uneasily with depriving pensioners—who by no conceivable definition are the rich in society—of a legitimate part of their income.

The same goes for the Government's sins of omission as for their sins of commission against the pensioners—they have done m thing about annuities. Many pensioners who, in good faith, set up a financial portfolio under which they would be obliged to buy an annuity at 75 face a serious situation that has perhaps been made much worse because the Government will not be involved in the gilt market as much as they once were. That is welcome in many ways, but pensioners will be adversely affected and face relative penury because the Government simply will not act. They should do something for those pensioners, a number of whom from my constituency regularly write to me, pleading for the Government to act. As one does as a Member of Parliament, I send those letters to the Treasury, only to get the usual blanket, stonewall answers. The Government have committed a gross sin of omission. If they want to claim that they are the pensioners' friend, they must consider that issue urgently.

I support what my party proposes to do with the state pension after the next election and I am pleased that it looks increasingly likely that we might win.

Mr. Swayne

We will win.

Miss Kirkbride

My hon. Friend encourages me to tempt fate, but one must never do that in politics.

However, the political landscape has changed dramatically over the past few weeks. I enjoy speaking to the Women's Institute in my constituency and must report to the House, as a matter of record, that I have never been slow handclapped by the Bromsgrove WI. I congratulate the WI on its view of the Prime Minister.

One reason for the change in the political landscape is that pensioners prefer the dignity of the pension being paid under the contributory principle, which we shall offer them at the next election, and like the idea of people being entitled to that money because they earned it during their working lives. Our proposals are not a gimmick and they do not represent a handout. That money could not be taken away at the whim of a Chancellor who thought that it was no longer a good idea to continue with any extra payment such as those introduced by this Government.

The Government's public relations used to be so sure-footed, so I cannot understand why the Chancellor has been foolish enough to give more money to pensioners—we accept that he has done so—in a grossly offensive way. That has backfired in terms of the pensioners' view of the Government: 75p was given on a contributory basis, but other money was given in the form of gimmicks and handouts. The sooner they learn their lesson, the better. Labour Members have been so excitable today because, in their heart of hearts, they know that too.

I commend our pension plans to the House. They are right for pensioners, some of whom would benefit by much more than the 42p claimed by the Government and the Liberal Democrats. Not all pensioners get free television licences; some do not even have to buy one. Those people would be helped by our policies. As my hon. Friend the Member for Havant (Mr. Willetts) said, pensioners on income support who live in nursing homes do not benefit from the winter fuel payment, but they would get our extra money for the basic state pension. Several groups would benefit from the straightforward principle of giving pensioners what they deserve—an enhanced weekly pension.

3.9 pm

Ms Claire Ward (Watford)

I welcome this Opposition day debate because it highlights further the hypocritical opportunism of the Tories, which is at the core of their party. In choosing the subject for today's debate, Conservative Members seem to have forgotten their record when in office. It shows that they have no interest in pensioners. The previous Government abolished free eye tests for pensioners; they also abolished the link with earnings. That made pensioners poorer and resulted in the Government's introduction of the 75p increase for pensioners in April this year.

Mr. Swayne

Does the hon. Lady favour the restoration of the earnings link? If so, has she made representations to the Government Front Bench?

Ms Ward

I shall comment on the way in which the Government could do much better later. I assure the hon. Gentleman that I shall reach his point, if he will have a little patience.

I am currently considering the previous Government's record. They allowed winter fuel payments to be made only if stringent conditions, about which we heard earlier, were satisfied. They made pensioners poorer so that between 1979 and 1997, the gap between the richest and the poorest pensioners increased. The incomes of the richest pensioners rose by 80 per cent., while those of the poorest increased by only 30 per cent.

Through their plans to abolish parts of the social fund, the Tories have demonstrated again that they are not interested in pensioners or anybody who is on low pay and in need of help. When Conservative Front-Bench Members make their winding-up speeches, I hope that they will identify the exact benefits, which are currently available through the social fund, that they would abolish, and the sections of the community that would not have access to that important fund.

Despite such a track record, Conservative Members have the cheek to try to con pensioners by proposing a handout, for which money that they already receive in a different form, would pay. Pensioners will not be deceived by that. It is an insult to a generation that deserves much better from all politicians to be used by the Tories for a cheap headline. Pensioners would not benefit from Tory policy.

As for the Liberal Democrats, the hon. Member for Northavon (Mr. Webb) is no longer in his place. That shows that not only their policies have disappeared. If the hon. Gentleman returns while I am speaking, I shall consider the points that he made in his speech.

The Government's actions for pensioners to date should be applauded. The minimum income guarantee ensures that the income of the poorest pensioners is increased so that they are able to live in some dignity. The winter fuel allowance acknowledges that, in winter, pensioners worry about the cost of heating. The allowance of £150 will be paid to all pensioner households from December this year. It ensures that pensioners will not have to choose between heating and other necessities. Restoration of free eye tests for pensioners and the introduction of free television licences for those aged over 75 are important. The Government should be commended for that.

The hon. Member for Northavon has now returned. That gives me the opportunity to comment on his speech. It is no wonder that his colleagues have deserted him. If I were a Liberal Democrat Back Bencher, and had witnessed the hon. Gentleman's inadequate performance, I would also desert him. No Government Front-Bench Member has achieved such a low standard. The hon. Gentleman said that, in 1997, he and his colleagues were elected on a manifesto commitment that no longer exists. I listened carefully to his speech, but he did not outline the new policy. When I return to my constituency and talk to pensioners, I now understand that Liberal Democrats had a policy that they no longer support, but have no policy to replace it. There is a policy vacuum. I am glad that the hon. Gentleman made matters as clear as mud.

Mr. Webb

The hon. Lady has not followed our pension debates closely. Otherwise, she would know about our policy for age additions to the basic state pension, increases across the board for all pensioners and our alternative budget, a costed document, which is produced every year. That is the latest statement of our policy, and it provides precise figures, including those for the increases and the age additions. If the hon. Lady is in any doubt, I am happy to send her a copy.

Ms Ward

That will be a riveting read. The hon. Member for Northavon made it clear in his speech that the Liberal Democrats' policy had not been determined and that that would happen during a future policy conference. I therefore conclude that if he no longer supports the policy on which he stood for election in 1997, and will not have a confirmed replacement policy until the end of the year, he, like all Liberal Democrats, is in policy limbo.

Mr. Bill Rammell (Harlow)

My hon. Friend is right to describe the Liberal Democrat position as a policy vacuum. Does she know that the costed alternative budget contains no costed commitment to the restoration of the link between pensions and earnings? Does she therefore agree that it is dishonest of the Liberal Democrats to claim around the country that they are in favour of restoring the link when they have not costed their commitment to do that?

Ms Ward

It is obvious that my hon. Friend has also faced the difficulties of local Liberal Democrats making claims that are not supported by their national policies or spokespersons.

Mr. Swayne

I, too, have a difficulty.

Ms Ward

Perhaps the hon. Gentleman will allow me to make a little more progress, which will give him even more reason to intervene.

The Government have done a lot for pensioners, but we can do much better. We must do more in the rest of the Parliament. Some people may justify the increase of 75p by comparing it with the retail prices index as it stood. However, while the price of a basket of goods may not have risen significantly, pensioners have faced other increases, even in the past few months, which have not been taken into account. In my area, the council tax and council rents have increased. That may cancel out the benefit of the new money for a section of our pensioner community in the middle-income group, and those who do not rely solely on a state pension, but have a small occupational pension, which takes them over the threshold for entitlement to additional support. Those pensioners could not be described as well off, but they are no longer in the third of the pensioner group that is entitled to additional funding to allow them to live in some dignity.

Unlike the Tories, our aim should be to retain the benefits that we currently pay to pensioners, and to increase the state pension as well. The debate has revealed the focus of the Tories' argument on pensions—not that pensioners should have more money, but that the money that they are already being given by the Government should be given to them in a different fund, from a different source. I approach the matter from a different point of view. I believe that pensioners should continue to receive the benefits that they are gaining from the Labour Government, and that they should have an increase in the basic state pension.

Mr. Swayne

rose—

Ms Ward

I give way to the hon. Gentleman. He is so persistent.

Mr. Swayne

I thank the hon. Lady. She is young, intelligent and articulate. There are many other compliments that I would pay to her, but I ask her to fancy herself as an aged lady, beyond the age of, say, 75, and to ask herself whether she would rather receive a free television licence or the value in cash. Surely it is better to have the cash: if she wanted a television licence, she could purchase one, or she could spend the money on something else that was preferable.

Ms Ward

I am ever grateful for any comments received, even from the hon. Gentleman, although I am not quite that desperate yet. He asks me to picture myself another 50 or 60 years from now. Should he still be on this earth at that time, I would be surprised. He asks me to choose between being given just over £100 or getting a free television licence.

If I pay £101 or £103 for a television licence, I want to receive the equivalent sum. If the licence is given to me free, that is a benefit to me, because it is just over £100 that I do not need to spend from my savings or the income that I receive in a state pension.

Yet again, the Tories have missed the focus of the pensions issue. I say to my right hon. Friend the Minister of State that we need to do a lot more to help pensioners. There is no doubt in my mind that next year, pensions should be uprated significantly—not just by the £2 or £3 that we have heard is likely to come in the increases next April, but by much more than that. The £2 or £3 is linked to prices, so pensioners are already facing those costs.

I want more pensioners to gain more money from the Government. I want the Government to ensure that pensioners get the benefits to which they are entitled. Many hon. Members come across pensioners who do not realise that they are entitled to various benefits and the minimum income guarantee. We need to do much more to take that campaign out to pensioners and to ensure that they get their entitlement.

I welcome the increase in the limit on savings and capital that was introduced in the statement by my right hon. Friend the Chancellor earlier in the year. That limit should be linked, so that we are not reliant on the Government to decide that the limit is out of date. The Tories left the limit at a very low level over a long period.

Pensioners' savings may be money for their funeral or money for a rainy day. It is their security in life. These days, £3,000, £4.000 or £5,000 is not a lot of money for pensioners to have, considering that that may be their only savings and their only support for difficult times.

We should extend some of the other benefits at present under consideration. As my right hon. Friend is aware, in the Transport Bill that has been before the House we are introducing a national concessionary fare scheme. Unfortunately, the terms of the scheme mean that pensioners will gain the minimum of half-fare travel on buses, and only within their own local authority area. Should my granny decide to travel from Scotland to visit me in Watford, she will get a half-fare concession in her own area in Scotland, but she will not be entitled to a half-fare when she comes to Watford.

There should be a truly national concessionary fare scheme, allowing pensioners who travel throughout the country to pay a minimum half-fare, wherever they are. I hope that my right hon. Friend will use his powers of persuasion with our colleagues in other Departments.

We should not take part in the debate with the Tories about existing benefits, arguing over money that pensioners are already getting. Our target should be to do even more for our pensioners. I make no apology for wanting us to do more. We have done a great deal for pensioners in three years—much more than the Tories did in their 18 years in office—but that does not mean that we cannot do more for pensioners in the remaining time of this Parliament.

Pensioners do not have time to wait. Those who have given their lives to this country cannot wait for us to consider what further benefits we feel they are entitled to. This week, we saw the character and the courage of the generation marking the anniversary of Dunkirk.

I know that pensioners in my constituency will not be taken in by the Tories' con, and neither should we be. We should move away from the debate about whether money should be paid through the winter fuel allowance or through pensions. Pensioners should be entitled to both the winter fuel allowance and an uprating in their pension. I urge my right hon. Friend to stand firm on the benefits that have been paid by the Labour Government and opposed by the Opposition. We are still not sure of the Liberal Democrats' views about some of our benefits.

My right hon. Friend should have a strong word with our right hon. Friend the Chancellor about more money for pensioners, to emphasise further the difference between the Government, who really care for pensioners, and the Tories, who are interested only in conning them.

3.28 pm

Mr. Desmond Swayne (New Forest, West)

It is always a pleasure to follow the hon. Member for Watford (Ms Ward), even if I could not follow entirely her logic.

There are casualties of the policy announced by my hon. Friend the Member for Havant (Mr. Willetts) from these Benches, but those are proper casualties. The first casualty is the new deal for lone parents. My own lack of enthusiasm for it is largely a consequence of the fact that it does not work. The pilot schemes for the new deal for lone parents showed that marginally more lone parents acquired employment where there was no scheme in operation than where there was a scheme. It is therefore entirely appropriate that we should do away with the scheme and put the money into pensions, where it is more deserved.

With respect to the social fund, I have never been a fan of it. There are elements of the social fund that are attractive and desirable, but one element has always struck me as undeserving. I am glad that the Secretary of State for Education and Employment has come to share that view, and also to believe that where consumer durables or items of furniture are required, there should be a greater expectation of the family and other social networks to stump up, instead of an application being made to the social fund, with the expectation that benefits will provide for those needs.

I know about this, because my wife is heavily involved with a charity that aims to provide precisely those items. It caters particularly for the needs of expectant parents. I have always thought it odd that parents, and expectant parents, should exhibit such resistance to second-hand equipment, especially at the lower end of the income scale. The relatively well off are generally happy to receive such equipment; the poorer people are, the greater their resistance seems to be. I think that that should be deprecated, and I am therefore not particularly exercised by the possible impact of our proposals on the social fund.

As time is limited, I shall deal with only one issue. I believe—and my belief is confirmed by my interpretation of the deliberations of the Social Security Committee—that we were right to break the link with earnings. If the state pension scheme were funded the desire to restore that link would be unanswerable, but I feel that the state pension should continue to provide a minimum standard of living, so that people are encouraged to make other provision.

The Government have put a great deal of thought into developing policy on that. They have launched many initiatives to encourage people to make arrangements for second pensions. I welcome those initiatives. Although many may have been misdirected, I think that the intention was proper and clear. I feel, however, that that intention has been undermined by the determination to uprate the minimum pension guarantee in line with earnings, which is an obvious disincentive. The main thrust of the policy was to encourage people to make their own arrangements to acquire second pensions, particularly lower down the income scale.

There was one point on which I tended to agree with the hon. Member for Watford. It is clear to those of us who do not resile from the breaking of the link with earnings that the decision to continue uprating in line with prices must be tempered with a better understanding of what constitutes the retail prices index for pensioners. It is obvious to me that the current arrangement for uprating pensions does not affect pensioners' real cost of living.

Kali Mountford

I have some sympathy with the hon. Gentleman's view that we should think again about whether there should be a pensioners' price index. Does that form any part of his party's policy?

Mr. Swayne

As I enjoy the freedom of the Back Benches, I think it proper for me to draw attention to what I consider to be problems, in the hope that my party's Front Bench will consider and address them. That, I think, is the proper role of Back Benchers.

This is one problem that I would like to draw to the attention of those on the Front Bench. I do not believe that our current arrangements take adequate account of the real costs of living for pensioners. If we continue to uprate pensions in line with prices—especially in the case of pensioners at the lower end of the income scale—we must take into account the real increases in their living costs. Otherwise, we shall face outrage every year.

3.34 pm

Kali Mountford (Colne Valley)

We have been confronted with a conglomeration of views and an examination of pension history that are beyond belief. There has been a complete misunderstanding of the way in which social security budgets are stacked up, how important they are, and why they should be as they are.

I am particularly concerned about two issues. One is the "robbing Petra to pay Paul" syndrome—a policy requiring babies to have second-hand prams and cots to pay for a pension scheme. I would not wish to subscribe to such a policy. I thought that the state pension should have a firm foundation, but the foundation for the proposals that we have heard today does not seem at all secure. They are based on taking away parts of the social security budget, and replacing them from elsewhere.

The hon. Member for Havant (Mr. Willetts) did not give a clear answer to our questions about the national insurance fund. If we are to change the basis of national insurance, let us be honest about it and have a proper debate about whether the national insurance fund should fund state pensions. The hon. Gentleman did not say that this was the new position, but if we examine the figures closely it is clear that state pensions would have to be financed by general taxation.

The figures simply do not add up. We are considering a package of measures aimed at those who need help most. It cannot make sense to say that the package does not, in the main, come from the national insurance fund—because it is paying for state pensions—and that we could somehow roll it up together and thus make a big increase in state pensions.

We are not even being honest and recognising that fact. Those who have drawn attention to it have been told that there are surpluses in the national insurance fund. Every time I have looked at the fund, I have concluded that the alleged surpluses are there for a good reason. They are there because that is how the social security budget must be accounted for. It must cover a range of matters—matters that the House has debated repeatedly. People simply will not accept that a short-term surplus cannot, in perpetuity, finance increases in the state pension, unless we review national insurance contributions.

The Opposition have not even said what they would do with the national insurance fund. They think that they can just tinker with the figures, but such tinkering will fool no one. It certainly will not fool those who will find £150 on their doormats in November, when they need it most. It is diabolical to suggest that it is patronising to give the poorest people the help that they need when they need it most, and it is also misleading. The aim seems to be to drag people into a debate based on fear.

Mr. Barry Gardiner (Brent, North)

Is the suggestion not also financially illiterate? If the poorest pensioners receiving the winter allowance had received the money in the basic pension, they would have lost it pound for pound through income support.

Kali Mountford

My hon. Friend is right. The Opposition claim that that is incorrect, but we have heard no firm statement because the figures do not add up.

Time is short, but I want to point out how vital it is to continue the winter fuel payment. Both opposition parties are opposed to that. Clearly they have not noted the views of Age Concern and Help the Aged, which have consistently said that hypothermia is claiming lives year on year. They say that it is a question of respect, and not patronising people. How patronising is it not even to provide extra measures that would help those people?

It is all very well for the hon. Member for Northavon (Mr. Webb) to say that some people could retain the benefit, but they may not be those who need it most. The people who need it most are those in receipt of the minimum income guarantee. The Opposition have decried the minimum income guarantee as something that has not been special, although increases in it, year on year, have been far above any increases paid to pensioners in the past. Although some pensioners have not experienced the benefit, it has gone to those who have needed it most.

3.40 pm

Mrs. Jacqui Lait (Beckenham)

It has been a telling debate. For our side, it has been telling to watch the massed ranks of the Government because the problem is that the opposition is on the Benches behind Ministers. To be able to say that their supporters were po-faced while the Secretary of State was, not terribly effectively, defending his own policy was a joy and pleasure to us all. [Interruption.]

Mr. Deputy Speaker (Sir Alan Haselhurst)

Order. I am sorry to interrupt the hon. Lady. I hope that outbreaks of sedentary comment will cease. It does not help the debate.

Mrs. Lait

I am always happy to get supportive comments.

We watched the Government's supporters not being able to support their own Front-Bench team and the Secretary of State. In fact, every contribution that we have had, other than the fairly technical one from the hon. Member for Colne Valley (Kali Mountford)—we do not have time to debate the technicalities, much as I would like to—and a part of the speech by the hon. Member for Watford (Ms Ward), basically said, "You have got it wrong. You have to do better." We have done precisely that. That is what the problem is. The Government's supporters and, indeed, the Government are thoroughly rattled by the very sensible proposals that we have made.

It is interesting. The first speech that I made at the Dispatch Box was—to give them credit—during a debate that was initiated by the Liberal Democrats, who tabled a motion suggesting that the 75p increase was not enough. I remember saying at that time that it was a measly increase, but it is interesting to note that their amendment today goes no further than their motion at the beginning of the year. They say, "We will pay pensioners more." Now we have the promise that they will tell us in a few weeks where the money is coming from. We all hold our breath, but we all know that the Liberal Democrats say one thing and do another, should they ever be given the opportunity, which I doubt.

We, however, have been listening very hard to pensioners. We slave listened to the organisations that represent them. We have listened to our constituents comments in letters and at our surgeries. My goodness, I have a heap of letters, as I am sure every Member does—

Mr. Gardiner

Will the hon. Lady give way?

Mrs. Lait

I am terribly sorry; we are desperately short of time. If the hon. Gentleman had been here for most of the debate, I might it have been more tempted.

What we have heard from pensioners is consistent and clear. They are saying, "We do not like being patronised. We do not like being told how to spend our money. We think that the plethora of allowances and benefits is confusing. We do not like the nanny state." We listened and we acted.

It was my hon. Friend the Member for Bromsgrove (Miss Kirkbride) who, in an excellent exposition, outlined exactly what we have proposed. Despite the shortness of time, I will run through it quickly. It is important that we get it on the record because so many wild accusations are floating around, including the one from the Secretary of State, who, I am delighted to see, is back in the Chamber and who persists in saying that our increase is £5. It is £5.50. I would be grateful if he tried to get that fixed in his brain.

We took the Government at their word that the state pension would next rise by between £2 and £3 a year. We then took the money that they are spending on winter heating and on free television licences. We added the age addition for the over-80s and the Christmas bonus. We looked at the savings that we could achieve from abolishing those gimmicks. We added the money to be saved from winter fuel payments to men aged between 60 and 64, which the Government did not plan originally to give them. We took some of the extra money that the Government have put into the social fund and we used the money from the failed new deal for lone parents.

We were then able to promise—

Mr. Darling

It will add 42p.

Mrs. Lait

I am afraid that the Secretary of State is too devoted to "The Hitch Hiker's Guide to the Galaxy". That is not the answer to everything.

We were then able to promise all pensioners the increases that—

Mr. Darling

Will the hon. Lady give way?

Mrs. Lait

I would dearly love to give way to the Secretary of State. It would be a huge—

Mr. Darling

rose—

Mrs. Lait

I give way.

Mr. Darling

Clearly, the Conservative party has been on a hitch hiker's guide to the galaxy. It has come up with exactly the same answer, which is 42p.

Mrs. Lait

What we have come up with is the answer that pensioners want. Pensioners want to get rid of the gimmicks that the Government have been buying them off with. They want the dignity and self-respect to pay their own way on their own budget on a weekly basis. They know that if they receive the money weekly, any future increases will be based on that increased state pension. Many Members are trying to portray it as a one-off increase. It is not. It will increase and roll on year by year. The base rate has gone up.

Mr. Greenway

Will my hon. Friend give way?

Mrs. Lait

I will give way briefly because I am aware that my hon. Friend wanted to speak.

Mr. Greenway

In the catalogue of things that we propose to save money on to pay for the package, does my hon. Friend include the more than £20 million a year that it will cost to run the bureaucracy to give the free television licence?

Mrs. Lait

That is, indeed, part of the savings increase. My hon. Friend tried hard to get into the debate, but was not able to.

Mr. Kaufman

Will the hon. Lady give way?

Mrs. Lait

I am sorry. I will not give way again as I have only four more minutes.

Mr. Kaufman

On a point of order, Mr. Deputy Speaker. Has the hon. Member for Ryedale (Mr. Greenway) approached you to have Hansard corrected in view of the fact that Hansard reports him as warmly and enthusiastically supporting the free television licence that he now nods at as a gimmick?

Mr. Deputy Speaker

The right hon. Gentleman is an experienced Member and knows that he is trying to pursue a point of debate under the guise of a point of order.

Mrs. Lait

We were able to make those promises two weeks ago. My right hon. Friend the Member for Richmond, Yorks (Mr. Hague), our leader, made the promise at that time. I shall read the relevant paragraph from his speech because, clearly, many people have not read it. He said: We would also adjust tax allowances for older people to compensate pensioners for any extra that they might otherwise pay. It is practically in words of one syllable. He went on: we would adjust means tested benefits to ensure that the poorest pensioners gain at least as much as other pensioners. That is in the costings. It was said by my right hon. Friend. It was said by my hon. Friend the Member for Havant (Mr. Willetts); indeed, it was said by any Conservative who was briefing on that day. It is why the Secretary of State and other Ministers in the Department of Social Security are petrified by what we have suggested. Indeed, the hon. Member for Stockport (Ms Coffey), the Secretary of State's PPS, is giving a very good imitation of someone who is having a nervous attack at the success of what we have proposed.

Many pensioners are telling us that our proposal gives them dignity and choice. We have been able to give them what they require to feel that they are decent, honourable and upstanding members of society, unlike the Government, who continue to patronise, to confuse and to dish out sums of money to meet their political ends, not the requirements of pensioners who are our first priority.

3.49 pm

The Minister of State, Department of Social Security (Mr. Jeff Rooker)

Is that it? Opposition Members have finished speaking, Mr. Deputy Speaker, and you have called me to speak, but I have not really heard anything yet. However, looking at the Order Paper I was struck by the fact—I am a bit superstitious; I do not walk under ladders or do anything like that—that, as my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) said, the Opposition have chosen, on their 13th allotted day, to debate pensions. They have told us nothing new about pensions, other than that they will spend exactly the same money on pensions as is now being spent on them. No one will ever remember the Opposition's motion, but everyone will remember the substance of it: this is the 42p pension debate. That is what Opposition Members have talked about today. That is what it amounts to.

We have not heard anything of substance that is new from Opposition Members, and they know it. They also know that their proposal is a con. That is why they were so angry with my right hon. Friend the Secretary of State for finding them out so quickly. As the hours passed, they changed their position and squirmed about their so-called policy initiative.

There have been some interesting speeches from both sides of the House, and some of them were thoughtful. The hon. Member for Bromsgrove (Miss Kirkbride) covered a range of subjects, some of which were partisan. However, I think that there is a meeting of minds that, in the years since the war, the House has not exactly shone with glory in addressing the issue of pensioners' incomes. As I said, there have been various attempts—by Richard Crossman, Boyd-Carpenter, Barbara Castle and even Keith Joseph—simply to get to grips with the fact that the basic state pension was never intended to be the sole source of income.

Since 1948, that has been the basic tenet in the pensions debate, and the Labour and Conservative parties have both made attempts to deal with that fact. Regrettably, so far, of all those attempts not one has come to fruition in the House. Legislation was passed on one proposal, but it was never implemented. Other proposals have been modified over the years. However, the basic underlying fact is that we have to do something to get pensioners a second income, and preferably not one that relies on the vagaries of Governments, Chancellors and the national insurance fund. If people can have access to a separate, funded scheme, they will be better provided for. The consequence of that fact has been growth in occupational pension schemes and the creation of the stakeholder pension system, which will be funded.

Nevertheless, we must always—I make no apology for this—bear in mind the total income that pensioners receive, and we should not centre the entire debate on the basic state pension. For one thing, many people do not receive the basic state pension because they have not paid enough into the national insurance fund. There have been quirks in the national insurance system since it began, and they are grossly unfair to many pensioners. If people do not, for example, accrue 25 per cent. of a pension, they receive nothing—[Interruption.] Hang on; I am making a speech on behalf of the Government. I am not going to be told by Opposition Front Benchers what to say.

The underlying thrust of the Opposition's motion is that the basic state pension is the be-all and end-all of pension provision, and that we must never talk about other aspects of the matter. Opposition Members think that, by manipulating a debate on their own terms—just on the basic state pension, as if that is what people live on—they will appeal to pensioners.

As my right hon. Friend the Secretary of State for Social Security said, in 1997–98 the average pensioner income was £132, which is twice today's basic state pension amount. That sum includes SERFS, occupational pensions and personal pensions. It is also an average, and many people receive a much higher sum.

We make no apology whatsoever for targeting our extra resources on the poorest pensioners. We came into office and discovered that when the previous Labour Government left office, 40 per cent. of pensioners retired on to means-tested benefit. Today, the percentage is much lower—28 per cent. The fact is that those who do retire on to it, relative to those who do not, are much poorer than they were in 1978. In 20 years, the income differential between the top fifth and the bottom fifth of pensioners has changed from 2.5:1, to 3.5:1. We cannot close that gap without getting more money, and faster, to the poorest pensioners in relation to the general population. That is the reality, and increasing money across the board simply will not work.

Mr. Willetts

What about the winter fuel payment?

Mr. Rooker

I am coming to that. We make no apology at all for our other manifesto commitment—it was in the rest of the sentence—On pensioners sharing in the nation's prosperity. No one has ever said that the winter fuel payment and the free television licence for the over-75s—as the hon. Member for Havant (Mr. Willetts) said, the older the pensioner, the poorer he or she is—is means tested. It is right that those should go to the over-75s. The provision also he1ps to ensure that those pensioners share in the nation's greater prosperity.

As I said, we need to get more money, faster, to poorer pensioners. The Opposition, however, have come along and said that some of our schemes are gimmicks. One of the most upsetting aspects of this debate is that we have still not been told—we have asked the question more than once; I am sorry that the hon. Member for Beckenham (Mrs. Lait) did not answer it—exactly which part of the social fund they will abolish. Who will be affected by the abolition? We are talking about real people, not statistics.

I accept that, in the grand order of the sums Governments deal with, £90 million is chickenfeed. However, Conservative Members need that £90 million just to make their sums add up. They need it to get the 42p—just to get ahead of the game. However, they owe it to themselves to know exactly which group they will target in the social fund. They need to know that so they can sleep at night with a clear conscience. They should know which group of the poorest people in the country they will attack It is a great pity they have not said anything about that today.

Conservative Members were also very coy in the way in which they presented their policy. They mentioned the Chancellor of the Exchequer's statement on Budget day. We have not argued about that statement. We realise that the announcement on pension increases did not make headlines, but it was in Hansard. The Chancellor said that, on current forecasts, the increases would be at least £2 and £3. We are not committed to those increases—but they are minimum figures. Conservative Members were very coy in dealing with that. They did not want to quote the Chancellor. They could have quoted Hansard, with a column reference, to back up their figures, but that would have destroyed their argument in a flash. It would have shown that the money they are promising has already been promised by a Labour Chancellor, in the House, not in an outside press conference.

Pensioners have welcomed the winter fuel allowance and the free television licence as cash sums. A few hon. Members have quoted letters from people criticising the Government. Ministers and hon. Members receive such letters every day, and we try personally to read and respond to as many of them as we can. It should be said, however, that members of the public agree with what we are doing. It is only right that we should hear from some pensioners who have written to the Government to say, "We think that it is a good idea to have winter fuel payments and free television licences."

I have a letter from Mr. Harry Berry, and I have his permission to quote the letter and mention his name. He is not a constituent of mine, or even from a Labour constituency—he lives in Bury St. Edmunds. He is a former worker in the Post Office and has offered some positive suggestions. At the end of his letter, he said: Despite the unwarranted complaint by many of my contemporaries may I say thank you to a government who by offering me a free TV Licence and £150 Christmas Bonus— for winter fuel— has given me what amounts to a £5 pound a week increase in my pension. That is what 77-year-old Harry Berry acts ally said. People are saying, "Thanks very much—it is a good way to do it."

I also want to share with the House a letter that we received earlier this week. The letter typifies the need for the winter fuel payment better than I am able to do. If ever the Government had tried to encapsulate in an advertisement, television slot or photograph the message in this letter, we would have been told, "That is not true in Britain in the 21st century." I should add that I shall not be much longer in speaking, because I do not want to steal too much of the Opposition's time.

The letter is from a couple. As I do not have their permission to say their name, I shall not do so. However, they live in a village near Marlborough, in Wiltshire. As 6,000 people live in the village, they cannot be identified from their letter. It reads: Please may I thank yourself and your party for the fuel allowance that we as pensioners were awarded last winter? My husband and I have only the state pension, topped up by income support. For many years, before we became pensioners, we bought a wooding permit from our local forestry commission in order to keep our home warm as coal was so expensive. This became harder—gathering wood in rain, cold, ice and snow—as we reached pensionable age. The fuel allowance was a life saver, and we straightaway ordered £100-worth of coal, enjoying every second of the warmth it gave. I am sure we can't be the only ones to appreciate your allowance. Thank you once again. I dread to think about future winters if we had had to struggle home with the wet wood. I rest the Government's case.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 121, Noes 301.

Division No. 222]	[4.1 pm
AYES
Ainsworth, Peter (E Surrey)	Bercow, John
Amess, David	Beresford, Sir Paul
Ancram, Rt Hon Michael	Body, Sir Richard
Arbuthnot, Rt Hon James	Boswell, Tim
Atkinson, Peter (Hexham)	Bottomley, Peter (Worthing W)
Baldry, Tony	Bottomley, Rt Hon Mrs Virginia
Beggs, Roy	Brady, Graham

Brazier, Julian	Loughton, Tim
Brooke, Rt Hon Peter	Luff, Peter
Browning, Mrs Angela	MacGregor, Rt Hon John
Bruce, Ian (S Dorset)	McIntosh, Miss Anne
Bums, Simon	Maclean, Rt Hon David
Cash, William	McLoughlin, Patrick
Chope, Christopher	Madel, Sir David
Clark, Dr Michael (Rayleigh)	Maginnis, Ken
Clarke, Rt Hon Kenneth (Rushcliffe)	Major, Rt Hon John
	Malins, Humfrey
Collins, Tim	Maples, John
Cormack, Sir Patrick	Mates, Michael
Cran, James	Mawhinney, Rt Hon Sir Brian
Davies, Quentin (Grantham)	May, Mrs Theresa
Davis, Rt Hon David (Haltemprice)	Moss, Malcolm
Day, Stephen	Nicholls, Patrick
Dorrell, Rt Hon Stephen	Norman, Archie
Duncan, Alan	O'Brien, Stephen (Eddisbury)
Duncan Smith, lain	Ottaway, Richard
Emery, Rt Hon Sir Peter	Page, Richard
Evans, Nigel	Paice, James
Faber, David	Paterson, Owen
Fabricant, Michael	Pickles, Eric
Flight, Howard	Portillo, Rt Hon Michael
Forth, Rt Hon Eric	Prior, David
Fraser, Christopher	Redwood, Rt Hon John
Gale Roger	Robathan, Andrew
Gamier, Edward	Robertson, Laurence
Gibb Nick	Roe, Mrs Marion (Broxbourne)
Gill, Christopher	Rowe, Andrew (Faversham)
Gillan, Mrs Cheryl	Shepherd, Richard
Gorman, Mrs Teresa	Simpson, Keith (Mid—Norfolk)
Gray, James	Spelman, Mrs Caroline
Green, Damian	Spring, Richard
Greenway, John	Stanley, Rt Hon Sir John
Grieve, Dominic	Steen, Anthony
Gummer, Rt Hon John	Streeter, Gary
Hamilton, Rt Hon Sir Archie	Desmond
Hammond, Philip	Syms Robert
Heald, Oliver	Tapsell, sir peter
Horam, John	Taylor lan (Esher & Walton)
Howard, Rt Hon Michael	Taylor John M (Solihull)
Howarth, Gerald (Aldershot)	Tredinnick, David
Hunter, Andrew	Trend, Michael
Jack, Rt Hon Michael	Tyrie Andrew
Johnson Smith,	Viggers, Peter
Rt Hon Sir Geoffrey	Walter, Robert
	Waterson, Nigel
Key, Robert	Whittingdale, John
Kirkbride, Miss Julie	Widdecombe, Rt Hon Miss Ann
Laing, Mrs Eleanor	Willetts, David
Lait, Mrs Jacqui	Yeo, Tim
Lansley, Andrew	Young, Rt Hon Sir George
Leigh, Edward
Letwin, Oliver	Tellers for the Ayes:
Lewis, Dr Julian (New Forest E)	Mr. John Randall and
Lloyd, Rt Hon Sir Peter (Fareham)	Mr. Geoffrey Clifton-Brown.

NOES
Abbott, Ms Diane	Bell, Stuart (Middlesbrough)
Ainsworth, Robert (Cov'try NE)	Benn, Hilary (Leeds C)
Alexander, Douglas	Benn, Rt Hon Tony (Chesterfield)
Allan, Richard	Bennett, Andrew F
Allen, Graham	Benton, Joe
Anderson, Janet (Rossendale)	Bermingham, Gerald
Armstrong, Rt Hon Ms Hilary	Betts, Clive
Ashton, Joe	Blizzard, Bob
Atherton, Ms Candy	Borrow, David
Atkins, Charlotte	Bradley, Keith (Withington)
Austin, John	Bradley, Peter (The Wrekin)
Baker, Norman	Bradshaw, Ben
Ballard, Jackie	Brake, Tom
Banks, Tony	Breed, Colin
Barron, Kevin	Brinton, Mrs Helen
Bayley, Hugh	Brown, Rt Hon Nick (Newcastle E)
Bell, Martin (Tatton)	Browne, Desmond

Buck, Ms Karen	Gilroy, Mrs Linda
Burgon, Colin	Godsiff, Roger
Burstow, Paul	Golding, Mrs Llin
Byers, Rt Hon Stephen	Gordon, Mrs Eileen
Campbell, Mrs Anne (C'bridge)	Griffiths, Jane (Reading E)
Campbell, Rt Hon Menzies (NE Fife)	Griffiths, Nigel (Edinburgh S)
	Griffiths, Win (Bridgend)
Campbell, Ronnie (Blyth V)	Grogan, John
Cann, Jamie	Hain, Peter
Caplin, Ivor	Hall, Patrick (Bedford)
Casale, Roger	Hamilton, Fabian (Leeds NE)
Caton, Martin	Hancock, Mike
Cawsey, Ian	Hanson, David
Chapman, Ben (Wirral S)	Heal, Mrs Sylvia
Chaytor, David	Healey, John
Chidgey, David	Heath, David (Somerton & Frome)
Clapham, Michael	Henderson, Doug (Newcastle N)
Clark, Rt Hon Dr David (S Shields)	Henderson, Ivan (Harwich)
Clarke, Charles (Norwich S)	Heppell, John
Clarke, Eric (Midlothian)	Hewitt, Ms Patricia
Clarke, Rt Hon Tom (Coatbridge)	Hill, Keith
Clarke, Tony (Northampton S)	Hinchliffe, David
Clelland, David	Hodge, Ms Margaret
Clwyd, Ann	Hope, Phil
Coffey, Ms Ann	Hopkins, Kelvin
Cohen, Harry	Howells, Dr Kim
Coleman, lain	Hoyle, Lindsay
Colman, Tony	Hughes, Ms Beverley (Stretford)
Cook, Frank (Stockton N)	Hughes, Kevin (Doncaster N)
Corbett, Robin	Hughes, Simon (Southwark N)
Corbyn, Jeremy	Humble, Mrs Joan
Corston, Jean	Hurst, Alan
Cotter, Brian	Hutton, John
Cox, Tom	Illsley, Eric
Cranston, Ross	Ingram, Rt Hon Adam
Cryer, John (Hornchurch)	Jackson, Ms Glenda (Hampstead)
Cummings, John	Jamieson, David
Cunningham, Jim (Cov'try S)	Jenkins, Brian
Curtis-Thomas, Mrs Claire	Johnson, Miss Melanie (Welwyn Hatfield)
Dalyell, Tam
Darling, Rt Hon Alistair	Jones, Rt Hon Barry (Alyn)
Darvill, Keith	Jones, Mrs Fiona (Newark)
Davey, Edward (Kingston)	Jones, Ms Jenny (Wolverh'ton SW)
Davey, Valerie (Bristol W)
Davidson, Ian	Jones, Jon Owen (Cardiff C)
Davies, Rt Hon Denzil (Llanelli)	Jones, Dr Lynne (Selly Oak)
Davies, Geraint (Croydon C)	Kaufman, Rt Hon Gerald
Dawson, Hilton	Keeble, Ms Sally
Dean, Mrs Janet	Keen, Ann (Brentford & Isleworth)
Dismore, Andrew	Kelly, Ms Ruth
Dobbin, Jim	Kemp, Fraser
Donohoe, Brian H	Kennedy, Rt Hon Charles (Ross Skye & Inverness W)
Dowd, Jim
Drew, David	Khabra, Piara S
Dunwoody, Mrs Gwyneth	Kilfoyle, Peter
Eagle, Maria (L'pool Garston)	King, Andy (Rugby & Kenilworth)
Ellman, Mrs Louise	King, Ms Oona (Bethnal Green)
Ennis, Jeff	Ladyman, Dr Stephen
Ewing, Mrs Margaret	Lawrence, Mrs Jackie
Feam, Ronnie	Laxton, Bob
Fisher, Mark	Lepper, David
Fitzpatrick, Jim	Leslie, Christopher
Flint, Caroline	Levitt, Tom
Flynn, Paul	Lewis, Ivan (Bury S)
Follett, Barbara	Lewis, Terry (Worsley)
Foster, Rt Hon Derek	Linton, Martin
Foster, Don (Bath)	Love, Andrew
Foster, Michael Jabez (Hastings)	McAvoy, Thomas
Fyfe, Maria	McCabe, Steve
Galloway, George	McCartney, Rt Hon Ian (Makerfield)
Gapes, Mike
Gardiner, Barry	McDonagh, Siobhain
George, Andrew (St Ives)	Macdonald, Calum
George, Bruce (Walsall S)	McDonnell, John
Gibson, Dr Ian	McFall, John
Gidley, Sandra	McGuire, Mrs Anne

McIsaac, Shona	Sanders, Adrian
McKenna, Mrs Rosemary	Sarwar, Mohammad
Mackinlay, Andrew	Savidge, Malcolm
Maclennan, Rt Hon Robert	Sawford, Phil
McNulty, Tony	Shaw, Jonathan
MacShane, Denis	Sheldon, Rt Hon Robert
Mactaggart, Fiona	Shipley, Ms Debra
McWalter, Tony	Singh, Marsha
Mahon, Mrs Alice	Skinner, Dennis
Mallaber, Judy	Smith, Angela (Basildon)
Marsden, Gordon (Blackpool S)	Smith, Miss Geraldine (Morecambe & Lunesdale)
Marsden, Paul (Shrewsbury)
Martlew, Eric	Smith, Llew (Blaenau Gwent)
Meacher, Rt Hon Michael	Smith, Sir Robert (W Ab'd'ns)
Merron, Gillian	Soley, Clive
Michael, Rt Hon Alun	Southworth, Ms Helen
Michie, Bill (Shef'ld Heeley)	Spellar, John
Moffatt, Laura	Squire, Ms Rachel
Moonie, Dr Lewis	Steinberg, Gerry
Moran, Ms Margaret	Stevenson, George
Morley, Elliot	Stewart, Ian (Eccles)
Morris, Rt Hon Ms Estelle (B'ham Yardley)	Stoate, Dr Howard
	Stringer, Graham
Mountford, Kali	Stuart, Ms Gisela
Mudie, George	Stunell, Andrew
Mullin, Chris	Sutcliffe, Gerry
Murphy, Denis (Wansbeck)	Taylor, Rt Hon Mrs Ann (Dewsbury)
Murphy, Jim (Eastwood)
Murphy, Rt Hon Paul (Torfaen)	Taylor, Ms Dan (Stockton S)
Naysmith, Dr Doug	Thomas, Gareth (Clwyd W)
Norris, Dan	Timms, Stephen
O'Brien, Bill (Normarton)	Tipping, Paddy
Olner, Bill	Todd, Mark
O'Neill, Martin	Tonge, Dr Jenny
Öpik, Lembit	Trickett, Jon
Organ, Mrs Diana	Turner, Dennis (Wolverh'ton SE)
Osborne, Ms Sandra	Turner, Dr Desmond (Kemptown)
Pearson, Ian	Turner, Dr George (NW Norfolk)
Pickthall, Colin	Turner, Neil (Wigan)
Pike, Peter L	Twigg, Derek (Halton)
Pollard, Kerry	Tynan, Bill
Pond, Chris	Vaz, Keith
Pope, Greg	Walley, Ms Joan
Pound, Stephen	Ward, Ms Claire
Prentice, Ms Bridget (Lewisham E)	Wareing, Robert N
Prentice, Gordon (Pendle)	Watts, David
Primarolo, Dawn	Webb, Steve
Purchase, Ken	White, Brian
Quin, Rt Hon Ms Joyce	Whitehead, Dr Alan
Quinn, Lawrie	Wicks, Malcolm
Rammell, Bill	Williams, Rt Hon Alan (Swansea W)
Rendel, David
Robinson, Geoffrey (Cov'try NW)	Williams, Alan W (E Carmarthen)
Roche, Mrs Barbara	Williams, Mrs Betty (Conwy)
Rogers, Allan	Wills, Michael
Rooker, Rt Hon Jeff	Winnick, David
Rooney, Terry	Winterton, Ms Rosie (Doncaster C)
Rowlands, Ted	Wright, Anthony D (Gt Yarmouth)
Roy, Frank	Wright, Dr Tony (Cannock)
Ruane, Chris	Wyatt, Derek
Ruddock, Joan
Russell, Bob (Colchester)	Tellers for the Noes:
Russell, Ms Christine (Chester)	Mr. Mike Hall and
Ryan, Ms Joan	Mr. Don Touhig.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments), and agreed to.

MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved, That this House condemns the Opposition for making no commitment to the welfare of either today's or tomorrow's pensioners, opposing every step the Government has taken to help pensioners and producing proposals for next year's basic pension uprating which amount to bribing pensioners with money which is already theirs; recognises the legacy of increasing pensioner poverty left by the last Government; applauds the Government for doing more to help all pensioners, spending £6½billion more than planned by the last Government, but most for those who need help most by concentrating half the additional money on the poorest quarter of pensioners; congratulates the Government for tackling poverty directly with the Minimum Income Guarantee. helping take-up through better publicity and simplified claims procedures; supports the Government's plans to help those pensioners who just fail to qualify for the Minimum Income Guarantee by raising the capital limits to £12,000 from April 2001 and committing itself to bringing forward proposals for a Pensioner Credit which will reward thrift; congratulates the Government for helping all pensioners with their costs, including Winter Fuel Payments and free television licences for people aged 75 and over; and applauds the Government's strategy for ensuring that, in the future, nobody who has put in a lifetime of work or caring need retire onto means-tested benefits, including a commitment to the basic state pension, a state second pension which does more for 18 million people including those on low and moderate pay, with caring responsibilities or broken work records because of disability, and new flexible, low cost, stakeholder pensions.