When the right hon. Lady met her ministerial colleagues today, did she discuss with them the Chancellor's iniquitous proposal to reduce the real value of unemployment benefit? Does she not accept that such a proposal would lack compassion and common sense and that adding to the suffering of the unemployed is no solution whatever to the problems of unemployment?
The decisions on the rate of unemployment benefit that will apply from this coming November to the following November were announced in this House by my right hon. Friend the Secretary of State for Social Services the other day in these terms:
We are restoring the 5 per cent. abatement made in 1980, and that means that in November the standard rates of unemployment benefit go up by over 8 per cent. to £27·05 for a single person and to £43.75 for a married couple." —[Official Report, 23 June 1983; Vol. 44, c. 163]
The rates have been fixed and announced in the House, and I do not understand what the debate is about.
Yes. I am afraid that a system of PR does not give clear decisive government but rather a long sequence of horse deals under which many people who fought the election on the basis of one manifesto must then compromise everything that they have said to do deals with other minor parties.
The right hon. Lady said that she did not understand what the debate on unemployment benefit was about. Does that mean that she is now repudiating—as we would all wish her to do — her Chancellor's statement a few days ago that cutting the dole might enable people to get jobs? Does she not agree that the cuts in the dole that the Government have achieved so far have not had much success in getting any jobs?
The point is simple. The precise rate of unemployment benefit that will be paid from this November to the following November has been announced to the House, and includes not only 3·7 per cent. inflation but restores the 5 per cent. that was previously cut. Therefore, the unemployment benefit from next November to the following November has already been announced. The question about the rate for the following November does not therefore arise until after the Budget next year, and probably until after the RPI figure is announced next June. It seems much better to defer the debate until then.
Will the right hon. Lady give us an absolute undertaking that the value of the benefit will be sustained after that date and after that benefit, and will she answer the question I put to her a second ago? Does not that mean that she is now prepared to repudiate the statement made by her Chancellor of the Exchequer? Does she agree that if the policy, defined by the Chancellor, of cutting unemployment benefit were carried out it would mean a further increase in the numbers of people forced on to means-tested supplementary benefit, payments of which are already at a record level?
In our manifesto we pledged:
In the next Parliament, we shall continue to protect retirement pensions and other linked long-term benefits against rising prices.
As the right hon. Gentleman knows, unemployment benefit is not a "linked long-term benefit", as we
explained. Therefore, no long-term pledge about price protection was given. As he is also aware, the amount paid out to the unemployed is this year to be about £5·5 billion, of which, as he implied, about £2 billion is paid out by way of unemployment benefit from the national insurance fund. The right hon. Gentleman can see the latest figures in the Government Actuary's report, which will be in the Vote Office today. The majority of the unemployed obtain, should they need it, extra benefit through the social security system, which is what that system is there for.
I have given the precise position. The relationship between unemployment benefit, social security benefit, minimum wages and wages that are paid is a source of great debate among academics, and the right hon. Gentleman will find that there are almost as many estimates as there are academics considering it.
Has the Prime Minister read the speech made last week by the right hon. Member for Cambridgeshire, South-East (Mr. Pym), and will she be bearing his remarks in mind when deciding with her ministerial colleagues whether the real value of unemployment benefit is to be cut? Is the right hon. Lady aware that the remarks made by the Chancellor of the Exchequer about unemployment benefit were heartless and contemptible, even more so as so many of the jobless are the direct victims of the Government's disastrous economic policy.
I have read the speech and I have made the position on unemployment benefit abundantly clear. Perhaps there is one point that I did not sufficiently emphasise—with the November uprating the value of the benefit will be higher than when we took office.