§ 2.15 p.m.
§ Mrs. Lenà Jeger
I beg to move Amendment No. 10, in page 4, line 34, at the end to insert:Provided that any such increase shall not be subject to any condition as to the income of the family.The Clause enables the Government to increase family allowances at a subsequent date. Hon. Members on both 2231 sides of the Committee have asked the Government to give them some details of the proposals. We have heard from my right hon. Friend that we shall get this information before the House rises for the Summer Recess. My right hon. Friend is to be congratulated on the amount of work that she has put into this aspect of the case, and especially the careful research, the results of which were published only a few days ago.
I put down the Amendment because I thought it important that the Committee should have an opportunity of expressing its views on certain aspects of this complicated problem. I notice that in the OFFICIAL REPORT on 21st June my right hon. Friend explained that this provision, seeking power to increase family allowances, was inserted so thatif appropriate, any interim improvement in family allowances could operate from the same date as the increases in other benefits."—[OFFICIAL REPORT, 21st June, 1967; Vol. 748, c. 1741.]I hope that the Government have decided that it is appropriate that the actual date of improved family allowances should coincide with the changes brought about by the Bill, otherwise we shall create the position in which people with larger and poorer families, of the kind with which I am mainly concerned, will be having to find 2s. extra a week when the breadwinner is at work, and when they want to claim higher benefits they will be precluded from doing so under the wage stop procedure. I hope that it can be made clear that that is not my right hon. Friend's intention.
The Amendment seeks not to introduce a new principle but to reaffirm the basic principle underlying the original payment of family allowances. When that brave woman Eleanor Rathbone campaigned year after year for family allowances, her object was to arrange a family allowance unconnected with income and not contributory. The arguments in the House in discussion of the Act, as now, were that much money would be wasted by giving these allowances to people who did not need them, but the House and Lord Beveridge, in his Report, took the view that this was a separate, special benefit which should be paid as of right in respect of the children in a family 2232 It was generally accepted that where money was less essential to a family, the benefit should be recouped through Income Tax, because the family allowances are taxable. I am withstanding the temptation to discuss the rearrangements of family allowances in relation to Income Tax on children's allowances which would be out of order. The Amendment crystallises the far wider debate on selectivity and universalism—fashionable words but dangerous over-simplifications, which should not be allowed to divert us from the real needs.
The most challenging problem in this post-Beveridge era is to find the balance between personal spending and community spending and the right level between the social wage and the individual money income. Whatever the outcome of the wider debate, the Amendment would ensure only that the principles which actuated the origin of the Scheme were preserved and maintained. It should be made clear that there must be no income test. I do not think that the Committee would want to discriminate between one family and another—
§ The Deputy Chairman (Mr. Sydney Irving)
Order. I think that the hon. Lady has nevertheless been unable to resist temptation.
§ Mrs. Jeger
I apologise, Mr. Irving. My Amendment refers to family incomes, but I will try to keep more closely to it.
Because of the change in purchasing power, this benefit is now a smaller proportion of the average family income than when it was introduced. For a man with average earnings and four children, the original 5s. represented 12 per cent. of his weekly income. Today, family allowances represent less than 8 per cent.—
§ Mr. James Griffiths
Does my hon. Friend realise that the Beveridge proposals, which we accepted—it fell to me to put the Act into operation—was family allowances of 5s. a week in cash and services in kind equal to 3s. a week? Thus, Beveridge originally proposed 8s. a week. That should be considered to appreciate the full benefit of the old Act.
§ Mrs. Jeger
I thank my right hon. Friend for reminding us of that.
2233 On practical grounds, it is also unrealistic to suggest that family allowances should be linked to means. There is bound to be delay in payment, for one thing. If we tried to pick out by P.A.Y.E. or some other Inland Revenue means those families which needed bigger allowances than others, there would be considerable delay. Many wages fluctuate and it is impossible to accept the average yearly delay in tax assessment as relevant when dealing with a large number of poorer families, often with fluctuating wages.
I am appalled at the amount of bureaucracy which would be involved in inquiring into the change of income of every family before a weekly allowance was provided. I am sure that any hon. Members who support the idea of family allowances being related to any form of means test would see how completely impractical that is.
Moreover, if we limited this increase to what were regarded as the lower income families, there would be serious disincentive to work overtime and promotion. If a man received family allowances one week because his income was low but in a week in which he did a couple of hours overtime he lost the means-tested element of family allowances, there would he a great disincentive. Any such arrangement would also have a dampening effect on the wages structure.
I am sorry that my hon. Friend the Member for Bedwellty (Mr. Finch) is not here, because he and I have had many friendly arguments on this subject. I know that he is most concerned with families getting a decent minimum wage, so that the social benefits are of less drastic concern, but we agree, as do many of my friends in the trade union movement, that we must deal with the question of poverty of the families described in my hon. Friend's Report by the combination of a decent family income and realistic family allowances which will ensure that the worker with the larger family gets extra assistance.
If Clause 5 benefits are selective, I can see terrible administrative problems. I find the suggestion unacceptable philosophically, anyhow, but whenever benefits are made selective many people who are entitled to them do not get them. In the 2234 Report on the Circumstances of Families, it was confirmed that, of children in need and entitled to free school dinners only about one in four received them. Many other children are entitled to welfare foods and free milk but do not get them.
Therefore, the only way to ensure that through this Bill and the increases which we hope will come under Clause 5 there is no selectivity, but that the Government will stick to the original concept of the family allowances is a payment to raise which will ensure that when the announcement is made about increasing family allowances, no conditions at all will be imposed on the recipients. Chancellor of the Exchequer can be the standard of living for families. The trusted to deal with any income which is within his attention. I hope that the Government will accept the Amendment,
§ 2.30 p.m.
§ Dr. David Owen
I rise to support the Amendment, which also stands in my name, and I hope that the Government will accept it. My hon. Friend the Member for Holborn and St. Pancras, South (Mrs. Lena Jeger) has sketched to the House the main reasons for the Amendment, and I hope that she will not take it amiss if I correct one point which she made. In all our discussions about selectivity and universality, we have become so besotted with the words that I think she was in error in one statement which she may regret. Although we cannot go into them in detail, for there are many different approaches, most of the schemes which we have been seriously discussing are selective. I am therefore not opposed to selectivity in principle.
What I am objecting to in the Amendment is that the reason for payment should be subject to the person's income and that it should be a means-tested benefit. In family allowances I am strongly opposed to a means-tested benefit. But that does not mean that in some areas I am not prepared to see selectivity, and some of the methods of payment which have been suggested—which I support—by such bodies as the Child Poverty Action Group are selective. I wish that this were more clearly understood in the country. The aim is to give the major benefits to those people who at the moment do not receive large tax allowance benefits. That is all that we are asking. We are not 2235 asking that we should penalise a large section of the community, but we are saying that we should pay as much as a 25s. increase for the first and all subsequent children to those people who at the moment receive no benefit from tax allowances. The Government have already tackled the anomaly of mortgages and they can surely carry this principle into family allowances.
May I mention the speech on Second Reading—with much of which I agreed—of my hon. Friend the Member for Bedwellty (Mr. Finch). In that debate he indicated some areas of a selective approach to benefits which we can all support. He mentioned the extension of constant attendance allowance, which my right hon. Friend the Minister has also mentioned. There are approaches to these matters which we agree can be selective. I would say to my hon. Friend the Member for Bedwellty that there is not a major division of opinion between any of us on this side of the House because I see family allowances as complementary to attaining a minimum wage structure. I come from the City of Plymouth where wages are terribly low, and I am deeply concerned to get a minimum wage. If I felt that by pushing for increased family allowances I was harming the case for a minimum wage, I should be very troubled. In fact, I think that they are complementary.
My right hon. Friend the Member for Llanelly (Mr. James Griffiths) said that he preferred the term "family endowment". I agree with this. By calling it "family endowment" we should bring it within the concept of an incomes structure—and that is how Beveridge initially saw it. His initial recommendation was that it should be administered by the Treasury, and in many respects I regret that it went to Social Security, because we find it impossible in wage negotiations always to take account of families and family size. We are involved in a strange paradox. We make allowance for family size in supplementary benefits and yet by allowing the family allowances to fall largely into disrepute because they no longer have the same purchasing value as when they were initiated, we are no longer making for the man in full-time work, adequate provision for family size. We cannot make that provision in the 2236 wage-negotiating machinery, nor do we wish to do so. This has been recognised by many trade union leaders, and some wise leaders have come down in favour of the recommendation of the Child Poverty Action Group. It is a matter of great concern to me that so much discussion is taking place trying to get means-tested benefits. The Amendment is aimed at dealing with this difficulty.
In its article of 24th June, I confess that I thought the Economist did a great disservice to the arguments on this issue, because it was far too simpliste and suggested that everything was all too easy; there was no serious discussion and some of the major objection were not outlined. There was one point to which I would take particular objection. The Economist wrote:It seems quite obvious what scheme humanitarians should prefer. Britain should spend that £13 million a year to give means-tested increases to the poorer families only.There was no discussion in that article of the difficulties of this scheme. I fully understand that some would prefer this scheme, but there are powerful reasons against a means-tested scheme, not least its uptake and it is extraordinary that it should be proposed by hon. Members opposite. I do not wish to draw attention to the hon. Member for Cornwall, North (Mr. Pardoe), who is in favour of the scheme which I favour, and I will not assess the merit of the different schemes. The Opposition seem to favour a means-tested family endowment, and it comes ill from their lips that the high priests of the doctrine of incentives should be introducing something which cannot but fail to be a disincentive to the man who is in full-time work. He is the person on whom we must concentrate—the man in full-time employment.
I draw attention to the Report which has recently been published on Circumstances of Families, which owes a great deal to the inspiration of my right hon. Friend who set this research in motion. I am critical of some of the other aspects—about publicity given to it and the length of time that we have had to wait for the Report, as will be seen from the Order Paper—but it provides thoughtful ammunition for those of us who are seriously concerned about the implementation of means-tested family allowances 2237 schemes. This comes out clearly on page 29 where it is stated:… in families where the father was in full-time work and resources were below requirements, only a quarter of the children received free meals".This indicates that when we are talking about the dignity of people and their natural resentment at having means-tested benefits, this is not a point about which my hon. Friends talk just because of old memories. It is because they know that that dignity still exists. My family come from the Welsh Valleys, and I know from them and from my grandfather about these things. They told me about the days of the real unemployment, and the horror of it. But we all know that there still exists that desire to stand on one's own feet and to provide for one's own family. That is why, if we move the family endowment away from the benefits which are given as of right, we shall do ourselves a great disservice.
Many other arguments can be developed, and many things come out of this Report, one of them being that over 1 million children are living in poverty in this country. When I gave a figure of over 1 million on an Adjournment debate in December, some hon. Members thought that I was exaggerating, but the figures of the Report show that it is over 1 million—and the Report did not take account of one-child families, where there is considerable poverty, too. That is why we should give the benefit to the first child.
I know that there are financial implications and that the Government face great financial difficulties. I can understand all the arguments against putting any further load on the Exchequer. I also accept that some of the schemes which I support would perhaps do that. But I urge the Government to remember that by their prices and incomes policy they have held wages very low. People in full-time work with very low wages have been deeply affected over the last few winters. By a substantial increase in family allowances we can to a great extent get round the anomalies of the wage stop, we can give a boost to the lower-paid worker and, above all, we can show once more that the Labour Party are deeply concerned about poverty. If we have to increase taxation to deal with it, I shall be prepared to go to the country and explain why.
2238 There comes a time when love should be the basic principle of political action. We can argue too much about what may be rather unpopular with certain sections of the community. I want to see the Government acting decisively. I know that my right hon. Friend is fully aware of the implications of any decision which would involve us in means testing family endowment payments. That being so, I hope that the Government will accept the Amendment.
§ The Joint Parliamentary Secretary to the Ministry of Social Security (Mr. Norman Pentland)
As we wish to make progress with the Bill, I will reply briefly.
I have listened with close attention to the remarks of my hon. Friend the Member for Holborn and St. Pancras, South (Mrs. Lena Jeger) and my hon. Friend the Member for Plymouth, Sutton (Dr. David Owen). I appreciate their concern in this matter. They both emphasised the need to ensure that any increase in family allowances under the Clause is not subject to any sort of means test. I can assure them straight away that the Amendment is unnecessary because the Clause does not give power to my right hon. Friend to introduce conditions for the receipt of family allowances beyond those contained in the Family Allowances Act; and, as they know, that Act makes no provision for means testing. I assure the Committee that any increase under the Clause will have to be in the form of a straight addition to existing family allowances.
My hon. Friend the Member for Holborn and St. Pancras, South asked if it was our intention that any increase should coincide with the increases in other benefits under the Bill. The answer is "Yes". My right hon. Friend has said on more than one occasion that the Government have promised to announce their proposals before the Summer Recess. I assure the Committee that this will be done. With this brief assurance, I invite my hon. Friend to withdraw the Amendment.
§ Mrs. Lena Jeger
I thank my hon. Friend for that reply and, in view of his remarks, I beg to ask leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Mr. Worsley
I beg to move Amendment No. 11, in page 4, line 36, to leave 2239 out from 'shall' to the second 'of' in line 37 and to insert:'not have effect until approved by resolutions of both Houses'.
§ The Temporary Chairman
I suggest that it would be convenient for the Committee to discuss at the same time Amendment No. 12, in page 5, line 1, leave out subsection (3).
§ Mr. Worsley
The Amendment is concerned with procedure. Certain hon. Gentlemen opposite may consider us to be high priests, but we do not intend at this point to try to debate the merits of any scheme for family poverty. The right hon. Member for Sowerby (Mr. Houghton) asked for a great debate on social policy. I wish that he would address that question to his right hon. Friends in the Government. They should indeed initiate such a debate. Instead, what have they done in this matter? Consider, first, the way in which the House of Commons has been treated over the Bill. We had three hours on Monday and then, four days later, a short Committee stage on the Floor of the House.
§ Mr. Pardoe
I understood that the decision to limit the debate to this ludicrously short time resulted from an agreement between the two major parties through the usual channels. If that is so, are the two major parties engaged in a conspiracy to stifle discussion on the Bill?
§ Mr. Worsley
Whatever may be the merits of that intervention, the fact remains that, on this key subject of family allowances and related matters, we are being totally deprived, under the procedure suggested, of a proper debate. Not only have the Government not come forward in the Bill with their promised proposal, but they propose that there should not even be a debate on an affirmative Resolution. The only way in which a debate could take place would be for the Opposition or other hon. Members to pray against the Regulations, and we know the limitations of a debate on a Prayer.
Amendment No. 11 suggests that there should be an affirmative Resolution so 2240 that a debate may be held on a Government order. This is much less than we should like. The Government intend to initiate a new policy in this matter and it should be debated in detail by the House of Commons. But the right hon. Lady will not give us that opportunity. This is, perhaps, not her fault. The fact is that the Government, after nearly three years in office, have still not made up their minds on this issue, although it is ludicrous to think that they have announced that they intend to make up their mind this month. They owe it to Parliament, instead of leaving matters until the Session is coming to an end, to make up their mind, tell us their decision and give us a chance to debate it.
The Amendment is not tabled in an effort to probe the subject or merely to initiate a debate. We feel it the absolute minimum that the Government should give; that is, that we should have an opportunity of debating the subject on an affirmative Resolution. We feel particularly strongly about subsection (3). The Clause begins by giving powers for a reduction of benefit in certain cases—as may appear to the Minister to be appropriate in consequence of an increase—but there is here a matter of principle of the greatest importance. Is it right that, on an order, which is not an affirmative one, the Government should be given power to decrease benefits in any case? This must be wrong in principle.
We say with a feeling of anger that the Government should make this the subject of an affirmative Resolution and that they should not treat an area of social policy of such importance in such a cavalier manner. This is another example of the technical incompetence of the Government. They owe it to Parliament, when initiating new policies of this sort, to allow hon. Members to debate such matters in detail.
§ Miss Herbison
I, too, will be brief, and I am grateful to the hon. Member for Chelsea (Mr. Worsley) for not speaking at length, although I appreciate the importance which he and his hon. Friends attach to the Amendment. He twitted us considerably about our not being ready to announce our plans. I repeat to him what my right hon. Friend the Chancellor of the Exchequer told the House; that the 2241 Government are reviewing not only expenditure on social security payments, but are carrying out a thorough review of the whole sphere of public expenditure. It is only then that we shall be able to have any sense of getting our priorities right. Because of that, it will not be until nearer the Summer Recess that I shall be able to make a full announcement.
I should have liked to have been able to agree to the proposal for an affirmative Resolution, because there is much in what the hon. Gentleman has said. We here propose to adopt the negative procedure, and a very important principle is involved when we may be lowering benefits for children. I accept that, but I remind the hon. Gentleman that what we do under the Bill will not last for years. The Committee will be aware, and I stress this very strongly, that the power for which I ask under Clause 5 is purely temporary. Whatever we do under it must come to an end by April of next year, so that the period involved is only from the beginning of November to the beginning of April. If it had been otherwise, I should have felt that there was a great deal more in the hon. Gentleman's case, although I admit that, in any event, there is something in it.
I am very anxious that if part of our plan is to raise family allowances along with other benefits in October, we should be able to do it in October, but acceptance of the Amendment moved by the hon. Gentleman would leave very little chance of these payments being made before December. I am sure that no hon. Member would want to deny these poorer families this benefit in those two winter months. For the reasons I have given, I hope that the hon. Gentleman, strongly though he feels on the subject, will be willing to withdraw the Amendment.
§ Mr. Dean
The Minister has granted that we have a good point here, but we are still left in the very difficult position of being asked to grant this power, not only to increase benefits, probably by a substantial amount, but also to reduce benefits for children within the National Health and Industrial Injuries Schemes with no indication at all of how the power is to be used. That is our difficulty. The right hon. Lady says that this is a temporary power, but she knows 2242 as well as we do that, once a new policy is introduced, even on a temporary basis, it has a substantial effect on the future pattern of arrangements for families.
The Minister has said that there will be a statement of the Government's intentions before the Summer Recess. Can she, at least, give an assurance that there will be an opportunity to debate that statement before we rise? Having admitted that we have a case, I am sure that she will agree that we should have some opportunity before the Summer Recess to discuss the promised statement. Such an assurance would, at any rate, go some way towards meeting what she herself agrees is a valid point.
§ Miss Herbison
I take the point, but I could not possibly, at this stage, say that there will be a full-dress debate. That must be discussed through the usual channels. In saying that, I should make it clear that the usual channels discussed the time that we should devote to this Bill. I will certainly keep in mind what the hon. Gentleman has said.
§ Amendment negatived.
§ The Temporary Chairman
Order. I am of the opinion that the principle of the Clause and the matters arising from it have been fully dealt with in discussion of the Amendments. Therefore, under Standing Order No. 47, I propose to put forthwith the Question, "That the Clause stand part of the Bill."
§ Mr. Houghton
On a point of order, Sir Ronald. I hesitate to question your Ruling, but this is a very important Clause, and with respect, it has not been fully dealt with in our discussion of the Amendments. One Amendment dealt with a matter that was not in the Clause at all, so I cannot see how that can be regarded as adequately covering the provisions of the Clause. The Amendment dealt solely with the procedure by which the Minister should act under the Clause. There has been very little discussion on this Clause today, and practically none on Second Reading, and I therefore submit that, perhaps, a few minutes could be spent on elucidation of the Minister's powers.
§ The Temporary Chairman
I would remind the right hon. Gentleman that subsection (3) was discussed with the 2243 Amendment, so we have really covered the whole Clause.
§ Question put and agreed to.
§ Clause ordered to stand part of the Bill.
§ Clauses 6 and 7 ordered to stand part of the Bill.