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Welfare Reform

Oral Answers to Questions — Social Security – in the House of Commons at 12:00 am on 11th January 1999.

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Photo of Paul Clark Paul Clark Labour, Gillingham 12:00 am, 11th January 1999

What recent representations he has received over his proposals for welfare reform. [63182]

Photo of Alistair Darling Alistair Darling Secretary of State for Social Security

We have received numerous representations on our recent proposals for reform towards our central aim of work for those who can and security for those who cannot.

Photo of Paul Clark Paul Clark Labour, Gillingham

I thank my right hon. Friend for that response. I draw his attention to the issue of security in retirement years. My constituents' main concern is that they have sufficient pension rights for a secure retirement. Thirty thousand of my constituents in Gillingham and the Medway towns are aged over 65 and living on means-tested benefits to help to supplement their income. What proposals does my right hon. Friend have to ensure that future pensioners will not have to rely on means-tested benefits for security in their later years?

Photo of Alistair Darling Alistair Darling Secretary of State for Social Security

My hon. Friend is right: one of the scandals that we inherited is that many pensioners are living on such low incomes that they depend on income support and other benefits. Part of the rationale behind my proposals for reforming pensions, which I announced to the House on 15 December last year, is to ensure that people who work throughout their life will make a worthwhile saving towards their pension. The result of my proposals—particularly for those who earn £9,000 a year or less, for whom we have doubled the rate at which their pension will accrue—is that people who work throughout their life will retire on an income sufficient to raise them above benefit levels, a laudable aim which should have been achieved years ago.

Photo of Sir Sydney Chapman Sir Sydney Chapman Conservative, Chipping Barnet

Does the right hon. Gentleman accept that, under his proposals for a minimum pension guarantee, those who suffer will be people who prudently save, because they will receive nothing from welfare, whereas those who spend everything will receive the maximum amount from the state? Does he think that it is fair for that to continue?

Photo of Alistair Darling Alistair Darling Secretary of State for Social Security

The hon. Gentleman is on to a good point. If he read the pension proposals that I made at the end of last year, he would know that the Government are considering how we can improve that situation. Before Conservative Members get too excited, I point out that, for 20 to 30 years, people who have a small amount of money in the bank or a comparatively small occupational pension have discovered that they are not eligible to receive the help to which others are entitled.

We have made it clear that we are prepared to consider measures to ensure that the minimum pension guarantee will be available to more people. We shall do so by examining what disregards might be appropriate for capital and income. The hon. Gentleman is right to mention the problem. It has existed for many years, but the Government are considering it and are prepared to tackle it.

Photo of Frank Field Frank Field Labour, Birkenhead

My question is about the representations that my right hon. Friend has received—and more than 1,000 people have responded to the various Green Papers. Does he recall that his colleagues have given answers stating that those representations generally support the Government's objectives for welfare reform? Is he aware that many of those submissions also make substantial points of criticism? If we are to have a proper debate, should not the Government respond properly and publish a Green Paper on those criticisms and worries and on how they intend to counter them?

Photo of Alistair Darling Alistair Darling Secretary of State for Social Security

I agree with my right hon. Friend that the Government should respond to criticism—they will—but I am wary of undertaking to publish Green Paper after Green Paper. The Government are anxious to ensure that we make progress and implement the reforms that people want. The consultation period for the pensions Green Paper, which is a matter very close to my right hon. Friend, finishes at the end of March. The Government will consider the representations that we receive and decide whether we need to publish a White Paper or whether we can proceed to legislation.

On disability and bereavement benefits, I have made it clear that the Government want to legislate in this Session. The consultation periods on those benefits have just ended or will end this week. In each case, the Government will respond to all suggestions and criticisms and make it clear what representations we can and cannot accept, but I can assure my right hon. Friend that the consultation is genuine and helps to inform Government decisions.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Chair, Social Security Committee

On 15 December, the Secretary of State said in his statement on pensions that, under the new Labour Government, Britain's pensioners were at least £140 a year better off. How is that increase made up?

Photo of Alistair Darling Alistair Darling Secretary of State for Social Security

I was explaining that, as a result of the Government reducing VAT on fuel, introducing winter fuel payments—which are now being made—and making changes to the fuel levy, pensioners are better off by £140 a year. The Government made a commitment to current and future pensioners, and we are fulfilling that commitment.