§ 10. Mr. Andrew Love (Edmonton)
What steps he is taking to improve public knowledge about pensions and saving for retirement. 
§ The Secretary of State for Social Security (Mr. Alistair Darling)
We want everyone who can save to do so. People think about their education and their working career, and they should think also about their retirement. So we are introducing individual pension forecasts that set out how much individuals will get on retirement. It should concentrate minds wonderfully.
§ Mr. Love
All the evidence suggests, first, that people begin to think about their pensions only when it is too late and, secondly, that the level of financial literacy in this country is far too low and needs to be raised. The Financial Services Authority has been given a statutory duty to promote an information and education campaign, but is that enough? What further steps of encouragement can the Government take to help people save for their retirement?
§ Mr. Darling
My hon. Friend has a good point. I suspect that most people tend not to think about their income in retirement until they are in their 50s, or when it is too late to build up a second pension.
First, we had to ensure that there were the means to enable people to save for their retirement. That is why we have reformed SERPS for the new state second pension and introduced a stakeholder pension to provide options that previously did not exist. We shall ensure that everyone receives an annual statement that tells him or her exactly how much they will get when they retire. Members will no doubt be aware that the Fees Office is in the process of sending out just such statements to Members, who frequently think about their second and third careers, especially at this stage in a Parliament. I am sure that many Conservatives wish now that they had thought about these matters during the previous 16 Parliament. We want to ensure that everyone in the country knows exactly where he or she stands on retirement, and then does something about it.
§ Mr. Edward Leigh (Gainsborough)
When it comes to knowledge about saving for retirement, will the Secretary of State acknowledge that the basic state pension is popular precisely because it gives dignity to people? They do not view it as a handout. It is something that they have worked for all their life. That is why they want an increase in the basic state pension. Is that perhaps why a Labour Back Bencher was quoted as telling the Daily Mirror:It's terrible. The Tory leader is saying in public what we've been saying in private for months …?Let us have some humility and no more spin. Just give pensioners what they want. Does the right hon. Gentleman acknowledge that 75p was a political disaster for the Government, and will he now act?
§ Mr. Darling
As far as I am aware, the hon. Gentleman stood on exactly the same manifesto as the rest of his Conservative colleagues at the previous election. Conservative policy in government and at the general election—
§ The Parliamentary Under-Secretary of State for Social Security (Angela Eagle)
He was a Minister.
§ Mr. Darling
My hon. Friend reminds me that the hon. Gentleman was a Minister in the previous Tory Government. Every year, they increased the state pension in line with prices, and that is what their policy remains. Despite the one-off policy of increasing pensions by all of 42p, which is what their policy is now, they say that that was a one-off and that they will go to price indexation thereafter.
We are doing better than that, but our priority in the first instance is to help pensioners who lost out during all the years when the Conservatives were in power, and during the years when the hon. Gentleman was a Minister, when he said absolutely nothing about pensioners or the basic state pension. He does not even dispute that. The Conservative Government's record was to leave us with a generation of pensioners who had so little to retire on that they were living below income support levels. That situation should not be tolerated, and that is why we have increased the moneys that we spend on supporting pensioners. In the first instance, we are giving most help to those pensioners who lost out during the Tory years.
§ Ms Helen Southworth (Warrington, South)
I really welcome the action that my right hon. Friend is taking for tomorrow's pensioners. It will solve many future problems. Far too many of today's pensioners are on unacceptably low incomes, thanks to 18 years of Tory Government mismanagement, which caused appalling neglect. Will my right hon. Friend take some early action to continue the work that he has already begun, so that we can increase the basic state pension and provide what Age Concern calls a modest but decent income for everybody?
§ Mr. Darling
We should aim to ensure that all pensioners share in the country's rightful prosperity. Surely the first priority must be to address the situation that we inherited, in which about 2 million pensioners 17 were living on pensions that were so low that they needed income support. I welcome what my hon. Friend has said, because she recognises that half the additional £6.5 billion that we are spending on pensioners is going to the poorest pensioners. On top of that, we have doubled the capital limits that enable pensioners to qualify for help. The Conservative Government did nothing about that for some 10 years before they lost the last election.
§ Mr. David Willetts (Havant)
I am afraid that the Secretary of State does not seem to have been listening to his own Back Benchers. Several Labour Back Benchers have called for a substantial increase in the basic state pension. That is our policy. We would get rid of the gimmicks and consolidate that money in a pension that pensioners want, which is a guaranteed entitlement. Why on earth did the Secretary of State not argue that case with the Treasury? Why was he happy to accept the 75p, when we are offering what pensioners up and down the country want? We are offering all pensioners an increase in the real value of their pension on top of what they get from the Government at the moment. If the Secretary of State does not listen, all Labour Members will need some retirement planning.
§ Mr. Darling
That is wishful thinking on the part of the hon. Gentleman. I shall tell him what I did listen to: I listened to the shadow Chancellor when he was asked about the Conservative party's pension policy. He said:It is a one-off policy. It is money which is already being spent.He is right, because the Conservatives are planning to scrap the winter fuel payment, the free television licence, the Christmas bonus and a range of other measures, and to give that money back to pensioners, the net result of which he has now had to admit would be that pensioners would be not £5, £7 or £10 a week better off, but 42p. That is before they start paying tax, and without taking into account the fact that some 2 million pensioners would lose out because of the help they get through the benefits system.
When the election comes, I am quite happy for us to be judged against what we have done, what the Tory party did in office and what it is now promising. Most pensioners will see that this Government are doing more for pensioners than the last lot would do if they were ever returned to power.
§ Mr. Bill Rammell (Harlow)
May I say openly and honestly that many of my constituents have expressed concerns about pensions and have urged the Government to do more, but not one of them has said that pensioners would be better off under a Conservative Government? They know that when the Conservatives, over 18 years, had the opportunity to do something about pensions, they did absolutely nothing. Does my right hon. Friend agree that during the debate on this issue in the past few months not one representative pensioners' leader has endorsed the Conservative party's proposals?
§ Mr. Darling
I can tell my hon. Friend something else. I am not sure that many pensioners would be grateful for their 42p once they read what the shadow Health Secretary had to say earlier this year. He said that health conditions such aship and knee replacements, hernia and cataract operations18 should be covered by private medical insurance. I do not know much about subscriptions to BUPA and other private insurance, but I am pretty sure that health cover costs more than 42p a week. A hernia operation costs £1,500, a knee operation £8,400 and a hip replacement operation £7,800. Those are BUPA prices—I took the trouble to find out what it is quoting, and 42p would not even look at it. Pensioners know exactly what to make of Tories bearing gifts: they do not believe a word of it.