Oral Answers to Questions — Pension Credit

– in the House of Commons at 12:00 am on 2nd April 2001.

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Photo of Paul Flynn Paul Flynn Labour, Newport West 12:00 am, 2nd April 2001

If he will bring forward the date for the introduction of the pension credit. [154872]

Photo of Mr Jeff Rooker Mr Jeff Rooker Minister of State, Department of Social Security, Minister of State (Department of Social Security)

I have to say no. The introduction of the pension credit will require primary legislation; it is not possible to introduce it by order We have consulted and we shall shortly bring our proposals to the House, and we shall do so as soon as practicable. Legislation and planning will then be required. Therefore, it is not possible to introduce the pension credit before our planned date of 2003.

Photo of Paul Flynn Paul Flynn Labour, Newport West

Have not the Government achieved a triple crown of improvements for pensioners? They have introduced the £200 winter fuel payment; the biggest increase in the basic pension for 25 years, which we hope will continue; and the pension credit, which will, for the first time ever, give those pensioners who have paid into private pensions all their lives real benefit from those contributions. It is marvellous that that injustice will end. In the extra time that we have in this Parliament, is it possible to get some swift legislation through?

Photo of Mr Jeff Rooker Mr Jeff Rooker Minister of State, Department of Social Security, Minister of State (Department of Social Security)

That is a matter for the business managers. However, we will introduce the proposals that result from the consultation as soon as we possibly can. The introduction of the pension credit will, for the first time since 1948, ensure that it pays to save. The way that the welfare state has worked—Ministers were never honest enough to admit it—meant that it has never paid to save for people on moderate earnings and small pensions. With the pension credit, it will pay to save for the first time. That is a great tribute to the work of this Government in this Parliament.

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

Will the Minister reflect on the fact that his initial answer to the hon. Member for Newport, West (Mr. Flynn) was not very convincing? Surely, if the House has the will, legislation can he passed quickly. Will the Minister therefore re-examine the possibility of introducing the credit in 2002? In addition, what is his estimate of the effect that the pension credit will have on Treasury funds, and what is that when we remember the £5 billion tax raid that the Government have perpetrated on pension funds?

Photo of Mr Jeff Rooker Mr Jeff Rooker Minister of State, Department of Social Security, Minister of State (Department of Social Security)

The hon. Gentleman misunderstands the position. The consultation has taken several months and we have received more than 400 submissions on the pension credit. We have not yet announced our final decision as to the shape of the credit. Although I would like to answer his question in detail, I cannot because the mechanics of the finances of the pension credit have to take account of the consultation and its interaction with other benefits, such as council tax benefit and housing benefit. Only after we have made our announcement on the policy can we instruct the parliamentary draftsman to get to work on drafting primary legislation. That is why we cannot do what the hon. Gentleman suggests.

I would also caution against rushing. More than half the pensioners in this country will benefit from the pension credit. Therefore, it is crucial that, when it is delivered, it works. If we rush it and it does not work, no one will thank us.