Retail Prices Index (Error)

Part of the debate – in the House of Commons at 10:48 am on 18th December 1987.

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Photo of Robin Cook Robin Cook , Livingston 10:48 am, 18th December 1987

As I have just purchased my first computer, may I begin by saying that I find it encouraging to learn that the Civil Service also makes errors with its programming.

Although the House may accept in a season of good will that such errors occur, it is extraordinary that it required a year and a half before such an error was uncovered, and remarkable that in such an important indicator as the RPI an error could remain unchecked and undetected for a year and a half, which included two uprating statements by the Department. I press the Minister for an assurance that there will be regular checks of the RPI in future, especially before uprating statements are made to the House on the basis of that indicator.

I turn to those who are being compensated as a result of the error and begin with the Minister's reference to public service pensioners. He said that the Government will compensate long-term claimants of benefit, but not short-term claimants. I presume that that is because long-term claimants are stable and can be identified and are the same people. By definition, public service pensioners are also long-term claimants of pensions and are the same people. There can be no justification for the distinction that the Minister has made between state pensioners and public service pensioners, other than the Government's distaste for civil servants.

Arrangements are being made for short-term benefit claimants. I remind the Minister that those claimants also have a benefit, which is also operated by reference to the RPI under statutory arrangements. Claimants of unemployment benefit face the same costs in purchasing bread and paying for heat as do claimants of state pensions. In October, 1·6 million unemployed claimants had been unemployed since last April. Were they to benefit from the same arrangement for compensation as pensioners, at least half that payment would go to people who have suffered because of the miscalculation, and at least half those receiving it would be people who had been unemployed for a year.

I press the Minister for a statement about the Government's future intentions. The statement tells us what the Minister intends to do to make good the past effect of the error. What does he intend to do to make good its future effect? I press the hon. Gentleman in particular for an assurance that next year's uprating statement will be calculated as though the correct level of benefit had been paid on the basis of the correct level of the RPI. I put it to him that any other assumption that uprates the current level of benefit that has been reduced by the error will leave the Treasury permanently better off and the claimants permanently worse off.

I turn to those claimants who are not covered by the statutory undertaking to increase their benefit by reference to the RPI, especially the 4·9 million claimants of supplementary benefit who are not pensioners. I remind the Minister that this group contains many who are long-term claimants, including single parents and carers for the disabled, who will have been in receipt of benefit throughout the period affected by the error. Their benefit is uprated by reference to the Rossi index, under informal arrangements. Will the hon. Gentleman confirm that the effect of the error in the computer programme has an even greater impact on the Rossi index than on the RPI index, and that these are the people who are frequently taken through the courts and prosecuted on any occasion on which they themselves succeed in obtaining £8 extra in payment by error? A Government who are as punctilious as this Government in reclawing the benefit that people have been overpaid, owe it to those claimants to be just as punctilious in compensating them when they have been underpaid.