HL Deb 09 May 1974 vol 351 cc669-72

5.2 p.m.


My Lords, I beg your Lordships' pardon for not being in the House when I should have been a moment ago. I understand that no Amendments have been set down to this Bill—


My Lords, I wanted to make one comment, so perhaps the noble Lord will move the appropriate Motion.


My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.—(Lord Wells-Pestell.)

On Question, Motion agreed to.

House in Committee accordingly.

[The LORD AIREDALE in the Chair.]

Clauses 1 to 4 agreed to.

Clause 5 [Amendment of Section 39 of the Social Security Act 1973]:

On Question, Whether Clause 5 shall stand part of the Bill?


I was unavoidably absent from the Second Reading of this Bill last week and I believe that the noble Lord, Lord Aberdare, on the Benches opposite was rather surprised that we should deal with a National Insurance Bill when, as he said, I was not present to speak. I should not like the Bill to go right through its stages in this House and disappoint him. While congratulating the Government, obviously, on the increase in pensions, I am particularly sorry that they have not used this opportunity to abolish the earnings rule. I recognise that the Minister will tell me that this would be costly to do. I am, however, still unconvinced on the figures that have been produced over past years, because I cannot see how that contention can be justified. I would merely say that those concerned form the only group in the community now who are unable to collect a straightforward pension without being subjected to some kind of rule which makes part of what they receive repayable if they earn over a certain amount. This is completely out-dated. We need the skills and abilities of many of these people. If it is wrong to earn when one is receiving a retirement pension, I cannot appreciate the fine distinction as to why it is wrong when you are 60, if you are a woman, but right if you are 65; and wrong at 65, if you are a man, but right at 70. I strongly suspect the reason is that probably no one is going to offer an opportunity for anybody to earn when he is 70 and therefore the Government are not so concerned about it.

Particularly in London, we are surrounded by all kinds of posts that need to be filled. As I have said before many times, I am concerned not for the people who have a great deal of capital behind them, but for people who retire very often on only the State pension and who could fulfil a very useful function by working, let us say, in the catering trade or in some occupation of that kind. This rule is completely outmoded and this is the moment when it should be abolished, although I would not distress the Minister at this late stage of the Bill by attempting to have the clause deleted. Nevertheless, it would be unfair if I did not say, as I have said to previous Governments, that this is a matter which should be looked at much more closely. In each Bill we seem to include the same old anomalies. I say quite respectfully to the Minister that the administration of the rule must cost money to operate. It is a very complicated scheme; it is not even based on a flat retention but upon a scale. I feel that at this stage the earnings rule should be abolished.


When I mentioned that I was disappointed that the noble Baroness did not take part in the Second Reading debate, that was in no sense a criticism of her; it was an expression of our disappointment because she had contributed on so many other occasions to similar Bills and we should have missed her words of wisdom on this occasion. Now, however, the noble Baroness has put that right and I much welcome what she has said. She has been consistent in opposing the earnings rule, and I do not think the earnings rule has a friend in the House, but unfortunately when we come to sitting on the Bench opposite and having to find the money for relaxing the rule then matters of priority arise, which I am sure the noble Lord, Lord Wells-Pestell, is now going to explain to us.

5.8 p.m.


I believe that most Members of your Lordships' House have a certain amount of sympathy, as the noble Lord opposite has just said, with what my noble friend Lady Phillips has requested. However, one must face the fact that the whole purpose of the earnings rule was designed to encourage men to retire on reaching the age of 65 and to make this possible by giving them a pension, albeit one to which they had made a contribution, and by giving a pension to their wives if they were 60 or over. We should all like to work towards the abolition of the earnings rule, but we must take a realistic view about the matter. It is no good saying that it does not matter that it is going to cost money. Let us be perfectly frank. Money is in short supply and we must use it to the best possible advantage. We cannot give increased benefits in other fields where they are extremely necessary and urgent without having some system of priorities. But we are—and no doubt this is true of a succession of Governments—working towards the abolition of the earnings rule.

Until this particular Bill came before your Lordships' House, the figure was £9.50 per week and it has now risen to £13. That alone will cost something like £8 million a year. If we had raised it to £16.50 it would have cost something like £16 million. This may seem a very small amount, but when you are dealing with a substantial number of pensioners and you have to provide for long-term needs and you are giving other benefits on short-term bases, you have to have a system of priorities to see how best the money can be spent. I should have thought that the Government are perfectly right to say, "We will fix the limit at £13, which is an increase of something like £3.50, and if we can do better in the foreseeable future then we shall do it". I am sure the noble Baroness will know that there is provision under Schedule 11 of the Social Security Act 1973 for this matter to be reviewed along with other benefits, but it would be quite wrong of me to hold out any hope that next year one could do even better. It comes back, as I said, to the question of making the best possible use of the money available and seeing that it goes in the right field. Having said that, I think that we all have sympathy with the view put forward by the noble Baroness, and perhaps one of these days, I hope in the not too distant future, we shall be able to meet the request that she has made.

Clause 5 agreed to.

Remaining clauses and Schedules agreed to.

House resumed: Bill reported without amendment; Report received.