HC Deb 25 June 2001 vol 370 cc379-81
14. Mr. John Randall (Uxbridge)

If he will make a statement on means testing among pensioners. [456]

The Secretary of State for Work and Pensions (Mr. Alistair Darling)

The benefits system has always included universal means-tested and non-contributory elements. In 1979, the proportion of expenditure on means-tested benefits was 17 per cent, by 1997 it was 35 per cent., but it is estimated that this year it will be about 30 per cent.

Mr. Randall

Has the Secretary of State ever been in favour of ending means testing for elderly people?

Mr. Darling

I believe that it is right, if the policy is to help people who need it most, to identify pensioners whose incomes are low. The alternative is to give people a universal, across-the-board increase. That is not currently the policy of any of the three major parties in this country and was certainly not their policy at the election. What is intolerable in this country is the situation that we inherited, In which 2 million pensioners were living in poverty. Their incomes were so low that they were automatically eligible for income support. We want to increase the amount that they get. If the hon. Gentleman is telling me that the Conservative party is against means testing, it must follow that he is now in favour of a universal pension.

Mr. Deputy Speaker (Sir Alan Haselhurst)

Order. I must tell the Secretary of State that he should not lapse into speaking about the policies of parties other than his own.

Kevin Brennan (Cardiff, West)

Does it annoy my right hon. Friend as much as it annoys me to hear Opposition Members bleating on about means testing? Is not it the truth that, whatever one's views about the earnings link, this Labour Government have done more for pensioners in the past four years than the hon. Member for Uxbridge (Mr. Randall) and his party would have done if they had been in power for a further 18 years?

Mr. Darling

My hon. Friend is right. It is necessary to take steps to end pensioner poverty. First, that involves finding out about pensioners' incomes so that they can be increased. Secondly, we must ensure that we have a policy that rewards thrift—something that did not previously happen in the social security system. Thirdly, we must help all pensioners not only through the universal basic state pension increase, but with other measures, such as removal from tax eligibility. It is worth bearing in mind that, from next year, almost three quarters of pensioners will either pay no tax or will pay it only at the 10p starting rate.

Mr. James Clappison (Hertsmere)

May I give the Secretary of State another chance to answer a question that he was asked not only just now, but earlier, by my hon. Friend the Member for Buckingham (Mr. Bercow)? Does he still share the objectives set out by the Chancellor in 1993 to reduce or end means testing?

Mr. Darling

I was explaining my answer, but was shown the red card, so I shall be careful. The Government's policy is clear. We believe that we must end pensioner poverty. It is therefore necessary to identify pensioner incomes that are so low that they should be increased. We must also ensure that people who have modest savings or a modest occupational pension receive additional help through the pension credit. Both those measures involve ascertaining how much pensioners have. If we do not do that, there is a choice; of alternatives. We can give no help at all—I think that that must be the hon. Gentleman's policy—or go back to universal, across-the-board increases, which would not address the pensioner inequality that we inherited and which we are determined to do something about.