HL Deb 12 July 1979 vol 401 cc1017-34

3.18 p.m.


My Lords, I beg to move that this Bill be now read a second time. This is a very short Bill which has two quite distinct purposes. The first is to provide a Christmas bonus of £10 for pensioners this year and to provide for bonuses to be paid in subsequent years. The second purpose of the Bill is to freeze for the time being the maximum amount of earnings which a dependent wife of a pensioner can receive before her husband's increase of pension for her is affected. I will explain the purpose of this rather more complicated provision in a moment, but let me first deal with the Christmas bonus.

Clause 1 of the Bill provides for this year's payment and Clause 4 enables provision to be made by order for the bonus in each subsequent year. This carries out the commitment in our election Manifesto, where we said: the Christmas bonus which the last Conservative Government started in 1972, will continue". This year, the Christmas bonus will go to over 10 million people, and the Bill sets out the categories of people who will be entitled. They are exactly the same categories of people who received bonuses in the last two years. As before, the Bill extends to Northern Ireland by agreement with the Secretary of State for Northern Ireland. The relevant week for determining entitlement will be the week beginning 3rd December. To qualify for the bonus a person must be present or ordinarily resident in the United Kingdom, or any other Member State of the EEC, at any time during the week beginning 3rd December and also be entitled to payment of a qualifying benefit for at least one day in that week.

Let me remind your Lordships of the people who will qualify. They are those in receipt of a retirement pension; supplementary pension; widow's pension under the national insurance, war pension or industrial injuries scheme; invalidity pension (including non-contributory invalidity pension); attendance allowance or unemployability supplement under the industrial injuries or war pensions schemes. The bonus will also be paid to war disablement pensioners over pension age who are retired or are treated as retired but who are not receiving any of these benefits. A man who is receiving a qualifying benefit with an increase for his wife will, where they are both over pension age, be entitled to a bonus for his wife, as well as for himself. The bonus will be tax free, and will not affect entitlement to other benefits or allowances. As I said before, all this is the same as in recent years. The bonus payments will cost about £108 million.

Your Lordships will no doubt recall that my noble friend Lord Boyd-Carpenter has, during debates on two previous Christmas bonus Bills and more recently in the form of a Question for Written Answer, inquired whether all war pensioners will be entitled to the bonus. I think your Lordships will find it helpful if I explain very briefly at this stage that between a third and a half of all war disabled pensioners will in fact be eligible for the bonus and that these include, as well as war disabled retirement pensioners, those whose disablement prevents them from working and a few war disablement pensioners over pension age who are not receiving a retirement pension. Those war disablement pensioners whom the Bill does not cover are, broadly speaking, men and women under pension age whose disablement does not prevent them from working. It is the Government's view that these people fall outside the broad categories of people for whom the bonus was intended.

Clause 4, which gives the Government power to pay the bonus by order in subsequent years, enables the Government to pay a bonus of more than £10 if that is considered appropriate at the time. Your Lordships will see that the Secretary of State is required to have regard to the economic situation in the United Kingdom, the standard of living in the United Kingdom and such other matters as he considers relevant in determining whether a larger sum should be paid. I must make it clear to your Lordships however that the existence of this power in the Bill carries no guarantee of any kind as to when or by how much future Christmas bonuses may be increased. The important thing is that the power will be there, and that we shall not have to have a new Bill each year.


My Lords, if the noble Lord will forgive me for interrupting him, I wonder whether he will be good enough to clear up one point on what he has just said? When both members of a married couple are pensioners, a man receives the bonus for his wife as well as the bonus for himself. Why is the bonus not paid to the wife?


My Lords, the wife will get hold of it!


My Lords, I am afraid I cannot answer that question, but I will certainly write to the noble Baroness, Lady Wootton, and tell her the answer.

I now turn to Clause 5, which contains the other substantive provision in the Bill. This removes the requirement for automatic annual increases in the level of the dependency earnings test for the wives of invalidity and retirement pensioners, and of disablement pensioners with an unemployability supplement. Some of your Lordships will probably remember that this dependency test is of fairly recent introduction so far as dependent wives are concerned. In 1971, when a previous Conservative Government introduced a number of new benefits for the long-term sick and the disabled, it was decided that a relaxation in the then dependency test would be useful to help the non-working wife of a chronically sick man to take up employment if her domestic circumstances and her husband's condition allowed. The basis chosen for the new test was the retirement pension earnings rule, which at that time was at a quite modest level.

It was convenient to use the existing earnings rule, and so avoid multiplication of tests. But because the rules are the same, there is a risk of confusion here. It may help if I make a point of explanation. First of all, the earnings rule which affects a retirement pensioner as regards his or her own pension has a quite different purpose from the dependency test which determines what benefit a man may receive for his wife. The one is a test of retirement; the other is a test of dependency. Our present proposal affects only the second case—that of dependency. It does not affect the retirement pension earnings rule, which we are committed to phase out in the lifetime of this Parliament.

In 1971, when the dependency increase was £3.70, the earnings rule started to bite at £9.50. That amount was rather less than the earnings a woman could expect from full-time employment. It was also less than the joint pension rate for a man and his wife, which was £9.70 a week. Today, a man can get the full £11.70 increase for his wife if her earnings (net of working expenses) are £45 and a reduced rate of increase if she is earning up to £58.70. It is not really very sensible to treat a woman as dependent on her husband, when she is earning substantially more than his total benefit as a married pensioner—which is at present £31.20. The previous Government were unhappy about this, and said so in Parliament. These matters are dealt with in the report on the earnings rule, presented to another place by the former Secretary of State on 24th October 1978.

There is little doubt that the retirement rule, which has been raised dramatically in recent years, has carried up with it the other limit, and that the latter is already substantially higher than could be justified by any test of dependency. Clause 5 allows the Secretary of State to deal with the dependency test outside the automatic uprating provisions, and so to let it find its own level. There is no question of actually decreasing it; but the Bill allows it to be left at its present level, probably until it bears a more rational relationship to the married couple's pension rate.

This change in the law will save some money on benefits. However, we are under an obligation to implement by December 1984 the EEC Directive on equal treatment for men and women in social security. Equal treatment will mean paying married women increases of benefit for their non-earning husbands and for their children. So when it became necessary to have a critical look at the financial implications of implementing the EEC Directive, it seemed right to look equally critically at the payment being made for dependent wives. My Lords, I hope that you would consider this just, and that I have given a sufficiently full explanation of the provisions of the Bill, which I commend to your Lordships. I beg to move that the Bill be now read a second time.


My Lords, before my noble friend sits down, and before the Question is put, may I ask him whether he is aware that what the noble Baroness, Lady Wootton, said is not exact? The sum of £10 for the wife is not paid to the husband; I have been trying for years to get hold of my wife's £10!

Moved, That the Bill be now read 2a.—(Lord Cullen of Ashbourne.)

3.30 p.m.


My Lords, I should like to thank the noble Lord, Lord Cullen of Ashbourne, for his explanation of this Bill, and to welcome what I believe is his first appearance in debate in his new capacity. We on these Benches welcome the fact that the Bill before us will ensure that the Christmas bonus is put on a permanent basis, that it will not be necessary to have legislation every year; the bonus will be paid every year. I have pressed in this House on previous occasions that that should be done. But I think it is important to state once again that the Christmas bonus, however welcome, is no substitute for an adequate basic pension. It is a little extra at Christmas and as that it is welcome.

We are bound to be concerned that the basic pension in future is to be related to increases in prices only and not to prices or earnings, whichever is the higher. I believe it is true to say that, if that new rule had been in force since 1973, the pension today would be £5 a week less than it is, or £260 per annum. Beside that figure—and a similar situation could occur again—the £10 bonus looks rather puny.

Provision is made in the Bill for an increase in the bonus, as the noble Lord said, but, as he also pointed out, there is no automatic increase each year. I believe that the bonus should be indexed, because if it were to be at its original value when it was first introduced it should now be £24. I think there should not be any further erosion of its value. I hope it is not going to meet with the same fate as the death grant, which should be £130 or more now to retain the original value of the grant established in 1949, yet is only £30. There has been a very considerable fall in value by default over the years. I hope that is not going to apply to the Christmas bonus.

In another place, expense was put forward by Government spokesmen as a reason for not providing for an automatic increase, for not indexing. But the bulk of the £108 million that this provision costs will fall in the National Insurance Fund. That Fund is paying out some £10,000 million a year, and the contributions to that Fund are earnings related; so the Fund should automatically be able to provide for earnings related benefits, including the Christmas bonus.

Turning to the other aspect of the Bill, to Clause 5, the earnings limit for depen- dent wives of pensioners, the noble Lord has explained very clearly what is going to happen. The earnings limit for dependent wives is to be held at £45 and not increased to £52 a week along with the earnings limit for pensioners themselves. As the noble Lord pointed out, the earnings rule for pensioners is to be phased out over the lifetime of this Parliament. That is because the Government and their predecessor came round to the view that a test of retirement was not necessary. But it is proposed to keep the earnings rule for wives of pensioners because it is a test of dependency, and to hold it at £45.

I can see that there is a case for keeping a test of dependency for wives under retirement age, but I should like to ask the noble Lord—and I hope he will be in a position to reply to this question when he replies to the debate—what will be the position of wives over retirement age who earn but whose pension depends on their husbands' contributions? Will they be covered in the future by the earnings limit for dependent wives? If so, we on these Benches would be critical of that.

In fact, we question whether a wife's pension should be dependent on her husband's contributions at all. A wife's pension, in our view, should not be related to dependency on the husband. We have been anxious for years to get away from the qualification by contribution record. We all know that contributions do not pay for benefits. The scheme is a pay-as-you-go scheme; the money that comes in is the money that goes out to pay for benefits immediately, not the money that was contributed in the past. We think it would be more sensible to regard the contribution as a social security tax and divorce it from qualification.

In the tax credits scheme which we prepared in April of this year in some detail we provided that all over pension age should get the same pension and that a married couple should get twice the single person's rate. That would remove the anomaly of a married couple getting less than two single persons living under the same roof. That is the direction in which we on these Benches would like to go. It follows from that that we are inclined to be hostile to the concept of dependency as a qualification for pension where wives over retirement age are concerned. So we would be critical if, following this Bill, the earnings rule were retained for wives over retirement age. That is why I ask for clarification. That is one of our two reservations about the Bill. As I said earlier, we are critical of the failure to index the Christmas bonus. But, apart from those two reservations, we welcome the Bill.

3.37 p.m.


My Lords, I should like to thank the noble Lord, Lord Cullen, for the way in which he introduced this Bill. I hope that I will not delay the business of the House too long. As the noble Lord, Lord Soames, said in moving the Motion, this Bill is moderately uncontroversial. Lord Cullen referred to the fact that there were two aspects to the Bill. One is the bonus for pensioners, which I think all of us in the House welcome; we welcome the fact that it will now come to pensioners in their own right without an annual Bill coming before the House, although many noble Lords would hope that in terms of value it can keep up with rising costs. However, the noble Lord then went on to indicate that there was a second aspect to the Bill, and it is to that that I should like to direct my remarks. I am referring, of course, to Clause 5 of the Bill, which has the purpose of freezing the earnings limit for dependents.

I should like to record my welcome to the fact that, as the noble Lord indicated, there is a long-term implication; as I understand it, the savings which will be derived from the freezing of the earnings limit for dependents will be used to finance what we hope will be a further Bill. I understood from the statement of the Secretary of State in another place that we could expect a Bill on this matter in this Session of Parliament. I would say how much I welcome that statement. I welcome the fact that the Government are taking such an early initiative to implement the EEC Directive on equality of treatment for men and women in social security. I underline my welcome to that.

I should like to follow the noble Lord, Lord Banks, in the comments that he has made. I accept that there has to be some dependency test, and I think it is to be welcomed that we are moving away from the automatic assumption that a wife is dependent on her husband to the assumption that dependency as such is something that we have to cater for and a dependant could be either a husband or a wife. Although the Bill before us talks about a dependent wife, the Bill which we anticipate later this Session will, I hope, deal with a dependent spouse. However, I welcome the change in definition, but there are problems in moving towards a quick change in that respect.

If we were to look at the situation of women today we would find, for example, that 57 per cent. of all working women would qualify under the present earnings limit. In other words, 57 per cent. of all working women—that is over 5 million working women—earn less than £45 per week. Therefore, the earnings rule would not affect them. However, as we move forward and as wages advance—as everyone expects that they will—the number of women who would be able to earn and in respect of whom their husbands would be able to claim an allowance, would decrease. In that respect we must face the problem that the majority of those 5 million women will be married women who have not contributed in full to the National Insurance scheme. Therefore, when they come to retirement they will not have a pension in their own right. Because of present practices and because of the operation of past legislation those women will be dependent on their husbands.

Therefore, I join with the noble Lord, Lord Banks, in asking the noble Lord to look at the distinction in the dependency test between women who are young enough to go out to work and to earn in their own capacity—and who will perhaps be covered by the new provisions in the social security legislation and will therefore earn a pension in their own right—and the majority of women who will come in the older age group and who therefore will have had no opportunity to earn a pension in their own right. So, although I welcome the concept of dependency as being one who is dependent on a spouse, I should like to ask the noble Lord whether he would look carefully at the details of the implementation of this clause in the Bill.

There are two points that I should like to draw to the attention of the noble Lord and perhaps I may put them in the form of a question. Again, I am anticipating what may come before the House later this Session. I am referring to statements which were made in another place when the Bill was introduced. We were told by the Secretary of State in another place that provisions would be introduced which would provide for dependency in the role-reversal situation—that is, where a husband and wife, no doubt together, decide that she should be the principal breadwinner. In the proposals which will come before us at a later date I hope that there will be provision for the free choice of the couple concerned to determine who will be the principal breadwinner and the principal provider, and therefore who will be the dependant. In other words, I hope that it will not be left to the Government or to Government agencies to determine who will be the principal breadwinner within the family.


My Lords, would the noble Baroness support the idea that the situation might change from time to time, and that the choice should not be once and for all?


My Lords, yes, I would accept that, but I think that we would then be moving into a situation where both husband and wife—or both spouses—would be building up, over a period, their own entitlement to social security in retirement, and that is a situation which we do not have at present.

Finally, may I point out to the noble Lord that I hope that, in preparing the legislation that we have been promised—legislation which will be dealing with very important principles in social security and taking account of the concept of equality between the sexes—he will consult with the wide range of organisations, both statutory and voluntary, who are interested in this subject, before bringing detailed proposals before the House.

3.46 p.m.


My Lords, at this stage in the list of speakers, a gap has been deliberately left in case the spirit should move any other noble Lord to rise and say a few words. I seem to fall into that category. I welcome the Bill, as I am sure do all Members of the House. The special bonus of £10 at Christmas for old-age pensioners is most welcome.

However, as regards what I am about to say I must declare an interest. I am 81 years of age and I want to speak specifically about the situation of the over-80s. I am suggesting that the over-80s are in a special category and should receive something in the nature of a special bonus over and above the £10 which is being paid to pensioners generally. The over-80s are not so robust as their younger brothers and sisters. Their state of health needs greater care and they need more careful feeding. They cannot, as a rule, go out and get a part-time job. Their living costs are dearer than for the ordinary couple because they have to buy their food and other requirements in small quantities.

The over-80s are really special people. They have had a very hard life. They have been through two world wars and they have lived through the hungry 1930s. They retired—and this is a most important point—before inflation came into full flood and therefore wages were low. Thus the amount which they could save for their old age was correspondingly limited. Therefore, I suggest that the over-80s require some special treatment. Although on this occasion, this afternoon, it is too late for anything special to be done for them this year, I trust that the Government will bear their special needs specifically in mind when they come to introduce a similar Motion next year—if they still happen to be in office.

3.48 p.m.


My Lords, 1 apologise for rising to make a few comments on the Bill without having given notice, but I am sure that your Lordships will understand what a great inconvenience it is not to have the normal facility of seeing a printed Order Paper. We have our annual printing difficulties, but when will they be overcome? The Order Paper is not delivered any more. Therefore, when a Motion to take all stages of the Bill is sprung upon us, as it was today, it makes it difficult to be fully equipped to deal with the situation.

The Bill will deprive me of the annual occasion of criticising it—of swimming against the tide of the Bill. Therefore, I think that I had better make my comments and say farewell to the opportunity, though, having had more to do with the origination of the Christmas bonus than anyone in the House, it probably ill becomes me to criticise it. However, I do not believe that this is the way to deal with social benefits.

In the beginning, the bonus was paid because we could not get an operation completed before Christmas and a great cry went up that making improvements to the statutory benefits was taking too long and that the beneficiaries who were badly in need of the money could not get it before Christmas. So, the first instalment of this was to give a bonus—of £10, incidentally—to all those who at the time were on national assistance or were receiving chronic sickness benefit. That was given in Christmas 1964 in order to overcome any hardship that might occur to those who were most in need, on account of the inability of the Administration to get the operation completed in time.

But, of course, doing it that way led to loud protests from all those on normal statutory benefits about the fact that those on national assistance only were recipients of extra money. Moreover, of course, the bonus then was chargeable to the Exchequer and not to the National Insurance Fund. To overcome that kind of criticism and to avoid discontinuance of this gratuity altogether, the next attempt to deal with it was to embrace all those who were on national insurance retirement pensions. Here I say to my noble friend Lord Leatherland that we ought to call all those beneficiaries what they really are: they are retirement pensioners and not old age pensioners. Neither are they necessarily old—not these days; many of them are comparatively young. They are retirement pensioners. We must regard them in the light of their position in the social security system.

If we are to make the benefit permanent by law, could we not remark on the fact that £10 is already out of date? It may be fulfilling a mandate from on high or be equivalent to a direction from Brussels, it being an item in the Conservative Party Manifesto, but £10 was not enough when they made the promise and it is not enough now, if one is to look at it in relation to the purchasing power of this gratuity in the past. Many anomalies are bound to arise from a distribution of a benefit of this kind out of the contributions of the people who are members of the National Insurance Scheme.

I shall not delay the House for longer than a minute, but another point is that we are moving towards a multiracial society. Christmas is a Christian festival, or it was; it is now becoming the season of the commercial exploitation of a religious festival. It has never been a more pagan festival than it is today. We are merely going along with the commercial idea that Christmas requires lavish spending by all concerned. Other religious communities celebrate other festivals, and we cannot expect for ever to have a Christian festival as a State occasion for the purpose of the distribution of national insurance benefits.

That is all I have to say. I regret that we are not doing this in a different way. I regret that we have not looked at the whole scheme of national insurance as a provision for those in retirement after a lifetime of work. I had hoped that we had got away from this kind of benevolent attitude towards retirement pensioners. They are citizens; they have completed their task in life; they have years before them. They have a right to a reasonable standard of living; they wish to share in the activities and in the benefits of the community generally. On the whole, I believe that concessions to retirement pensioners are undesirable. There should be statutory benefits and pensioners should have a claim on the resources of the community as of right, having regard to their contribution to the wealth of the nation, rather than encouraging the lather patronising feeling that arises on these occasions that it is nice to give the old age pensioners something for Christmas. I do not like that attitude and never have. It is a pity that we are to give it statutory blessing. However, that is what I have to say and I shall be unable to say it again.

3.55 p.m.


My Lords, I do not think this is the first time that I have been down this particular road, but the tradition of your Lordships' House makes me declare an interest in what we have been discussing this afternoon, because if I live until 3rd December I shall benefit by this Bill. When the noble Lord, Lord Cullen of Ashbourne, made his first speech at the Dispatch Box on 22nd November 1977—which was on this very matter—he was at some pains to remind me that the value of the £10 at 1972 prices was £5. May I remind him that it is worth less than £4 at present; in fact, it is worth only £3.97. But what will it be worth at Christmas? With the rocketing prices and the increased rate of inflation, inflation which we understand from his right honourable friend the Secretary of State is likely to be in the region of 17½ per cent. by November, there will be an increase of between 5 per cent. and 6 per cent. between now and November.

Today we have heard that the cost of paraffin is to increase by between 65 per cent. and 70 per cent. I notice that in the Budget there was no reference at all to an increase of the price of paraffin. I do not know whether it is due to the Secretary of State of Energy not knowing who uses paraffin. It is used mainly by people who can be described very adequately and accurately as poor people, but in the main by old-age pensioners. Did he not know that because he was not properly advised? If he did know it, and still took this action, then it is an act of callousness, and I question his wisdom in doing so and his right to hold the position he at present holds.

One of the noble Lord's honourable friends in another place suggested at one time that there should be a fifty-third-week payment for pensioners. This would mean that a married couple would receive in the region of £36.10 a week instead of the £20. I suppose that one can say most charitably that this was a kite which was flown and which has been shot down in flames by the new Government. I am sure that the noble Lord, Lord Cullen, will want to remind me that the retirement pension for a married couple will be increased by £6.10 in November as against—and I accept this—the £4 proposed by the Labour Government when they were in office. But, in view of the very serious increase in inflation and in the cost of living generally, will the pensioners be better off? Pensioners will require every penny of the increase to meet this increase in the cost of living. I am sure that the noble Lord will tell me—and I should do this if I were in his position—that the £10 was not raised under a Labour Government. That is true. However, not only did we substantially reduce inflation, but—as the noble Lord, Lord Banks, made abundantly clear—we linked increases in pensions with wages, which resulted in pensioners today getting an extra £5 a week—£260 a year. In future it will be linked with prices.

If the Government are to plead that the money is not available to do this, I would remind noble Lords opposite that they appeared to have no difficulty in finding the £660 million which they gave in tax cuts to those earning £250 a week. Less than one-sixth of the £660 million would have enabled the Government to double the Christmas bonus; to give every pensioner £20 instead of £10; and they would still have had somewhere in the region of £550 million to give away in tax reductions. In case the noble Lord should come at me on the next point, I acknowledge that a large number of people—I believe, 1 million—were taken out of taxation by the Budget proposals. But how many of that million could you count among the 10.8 million pensioners? Only an infinitesimal number of them pay tax.

It was my intention to raise a number of matters during the Committee stage on clause stand part, but there is a lot of business before your Lordships' House, and if I were to raise matters under clause stand part I do not think at this stage I would achieve very much, and one always has to be realistic. In particular, I do not like Clause 4, which only requires the Secretary of State to lay a draft order for the payment of £10, or a larger sum if he deems so. I would ask the Minister—I shall content myself with this—whether he would make representations to his right honourable friend the Secretary of State that the Christmas bonus should be raised at least to keep pace with inflation. As the noble Lord, Lord Banks, said, it should be indexed. I was almost going to say that I am quite prepared to start with the £10, but I really feel, in common with the noble Lord, Lord Banks, that this should be done.

I wanted to raise another matter under Clause 4 stand part and again on Clause 5, but both those matters have been dealt with reasonably adequately in the time permitted by both the noble Lord, Lord Banks, and my noble friend Lady Lockwood. But I would ask the noble Lord to read what the noble Lord, Lord Banks, and my noble friend Lady Lockwood have said because their observations are very cogent. I would ask him to point out to his right honourable friend that if there are to be in the future any more tax reductions for that section of the community who, in my opinion, can well do without them, then they should take into account any extra money that may well be needed for the old age pensioners.

4.3 p.m.


My Lords, I should like to thank all noble Lords who have taken part in this debate, and for the general welcome they have given to this Bill. That perhaps does not quite apply to the noble Lord, Lord Houghton, who was really making his goodbye swansong to this Bill, of which he does not approve. Having only just started to get involved in this field, apart from once or twice talking about the Christmas bonus before, I find that one does find oneself in rather a minefield. You start off on what seems to be a simple £10 for the pensioners, and you then get involved in all sorts of things which I know only a certain amount about. I am in the middle of a sort of crash course, trying to catch up with the extreme complications of the subject. I will, as the noble Lord, Lord WellsPestell, suggested, read extremely carefully what the noble Lord, Lord Banks, and the noble Baroness, Lady Lockwood, had to say.

Strangely, I have got replies—not out of my own head. To Lord Banks I should like to say that if a woman has her own retirement pension she is subject to the pensioner earnings rule, not the dependancy rule, no matter whose contribution record was used. I hope that that is a satisfactory reply to the noble Lord. So far as indexation of the bonus is concerned, obviously I cannot do otherwise than agree that this would be an excellent thing, and in many ways I suppose we would all like to have it made more realistic on the basis of what it was worth when we started it in 1972. However, I do not have to go into the question of lack of funds at the moment. As your Lordships know, this is simply just a continuation of what we have done. The same people are getting it, and the same amount, and regrettably in these inflationary times it becomes worth less and less.

The noble Baroness, Lady Lockwood, clearly has studied this subject in great detail and is well aware that savings are being made in this Bill which will be useful when it comes to carrying out our EEC requirements, where men and women will be equally treated. I shall also read with great interest what she has to say, and make sure that my right honourable friend the Secretary of State is fully acquainted with what has been said on these matters.

I was also interested in what the noble Baroness had to say, and what my noble friend Lord Drumalbyn interposed, about the role reversal of the breadwinner. It is a little early to go into this at this stage, but certainly it will be of great interest to those who are preparing legislation in the future. The noble Lord, Lord Leatherland, made a plea for the over-80s, to which I am sure everybody is very sympathetic. I would hope that the over-80s are particularly well looked after so far as ordinary pensions are concerned, and in that case I would, I think, feel rather like the noble Lord, Lord Houghton, does, rather than that they should get a slightly larger Christmas bonus. But that is just a personal opinion.

I hope that the noble Lord, Lord Houghton, will think—now that we are getting this on to a definite basis as opposed to being a handout which comes one year and not another, depending on the state of the economy—that it will not be so much of a patronising matter and that it will become a regular feature which, one hopes, as time goes by will be able to be raised when the economy can stand it. The noble Lord, Lord Wells-Pestell, of course know as much about these matters as anybody in your Lordships' House—he always sounded as though he did, which I am sure I do not—but I am not sure I really agree that £3.97 is the right figure. It is not far out. I think it is a little over £4, but I do not think we can really split hairs on that point. Certainly, as he said, in inflationary times it will become less in 12 months' time. He mentioned the rise in paraffin and I think he said it was going up by 60 per cent. I do not think that is right.


My Lords, I said it was going up to between 65p and 70p. If I did not, that is what I meant.


Obviously the noble Lord said 60 pence, which sounded like 60 per cent.; I thought we had better get it right. I quite appreciate that one of my honourable friends in another place suggested that a 53rd week might be another way of doing it, but, as the noble Lord pointed out, that died a very quick death and there is no question of that being brought up again. It is fair to say—Lord Wells-Pestell mentioned this—that, although the Christmas bonus is only a very small amount nowadays, the increase in pensions generally which has taken place since we came to power is the largest which has ever been made.

On the subject of taxation, I would suggest to him that the people he particularly mentioned as having had these concessions on taxation were people who needed them very badly indeed. He more or less picked out those in junior and middle management, and one hopes—and it is certainly the belief of the Government—that this incentive which has been given to them should be helpful to the economy in future and may help pensions later as well. I think I have dealt with all the questions I am able to deal with, and I therefore beg to move.

On Question, Bill read 2a: Committee negatived.

Then, Standing Order No. 43 having been dispensed with, pursuant to the Resolution, Bill read 3a and passed.