§ 6. Mrs. Cheryl Gillan (Chesham and Amersham)If he will make a statement on the taxation of pensioners. [3327]
§ The Paymaster General (Dawn Primarolo)As a result of our policies on tax, seven out of 10 pensioners pay either no tax or pay at the 10p rate. Our personal tax and benefit changes mean that pensioner households will be £600 a year better off on average compared with 1997.
§ Mrs. GillanThe hon. Lady's reply will be cold comfort for pensioners, as it does not reflect the reality. Will she admit that, under the Labour regime, pensioners have had more and more of their income taken in taxes? Will she also confirm that by 2003 more than half our pensioners will be subject to means-tested benefits for the minimum income guarantee and the pensioner credit? Is that Labour's way to ensure that pensioners, in the words of the Labour manifesto,
have much to give to society"—principally, it seems, through increased taxes?
§ Dawn PrimaroloI am glad that the hon. Lady is now concerned about pensioner poverty, bearing in mind the Conservative Government's record in office. The tax reforms and the introduction of the 10p rate, as well as the introduction of and rise in the winter fuel allowance 423 and the introduction of the minimum income guarantee, which puts in place a minimum income for the poorest pensioners, are assisting the Government to ensure that the resources that we have go to those in greatest need—the very poorest pensioners. I am sure that if she looks in detail at the proposals for the pensioner tax credit, she will agree that rewarding those pensioners who have saved through the credit is another way to tackle that poverty.
§ Mr. John McFall (Dumbarton)I thank the Government on behalf of the poorer pensioners in my constituency for taking their incomes up from £67 for single pensioners to £92. Does my hon. Friend agree that the scandal has been that those on small occupational pensions have been paying too much tax, and that the new pensioner credit is not coming in soon enough to help such individuals? What plans do the Government have to conduct an information campaign so that those hardworking individuals can receive their just reward and the tax rebate that they deserve?
§ Dawn PrimaroloAs my hon. Friend knows, the minimum income guarantee will be raised again next year, guaranteeing an income to those poorest pensioners. He is right that we need extensive publicity to ensure that those pensioners who will be entitled to the pensioner tax credit can receive it. The Government continue to review their tax policy on those few pensioners who pay tax so that, where possible, they can be removed from the tax system and any rebates to which they are entitled can be paid as quickly and easily as possible.
§ Richard Ottaway (Croydon, South)The biggest concern of any pensioner is the stability of their pension provider. Does the Minister recognise the concern and trauma of millions of Equitable Life policy holders and the failure of the regulatory authorities to protect their interests? In December 1998, the Treasury encouraged the Equitable to continue with its flawed strategy. Today, the Chancellor of the Exchequer declines to accept responsibility for that disastrous advice. This month, we discover that the Financial Services Authority did not even know that the Equitable was reviewing its financial position. Is it not time that the regulator started regulating and the Chancellor recognised that the buck stops with him?
§ Dawn PrimaroloIt would be ridiculous on such an important issue for me to stand at the Dispatch Box and give answers that were not based on information and fact. As the hon. Gentleman knows full well, the FSA is preparing a report on the events leading up to the closure of Equitable Life to new business. When we see the report and have the facts before us will be the time to have the discussion.