§ Order for Second Reading read.
§ 2.31 p.m.
§ Mr. Nicholas Scott (Paddington, South)
I beg to move, That the Bill be now read a Second time.
The Bill is no stranger to the House of Commons. A similar Bill has been before the House on five occasions for debate, and presented on six occasions. The purpose and the form of it remain the same today as on those earlier occasions. It is designed to make provision for the payment of pensions out of the National Insurance Fund to certain people who are not eligible for such pensions. The categories of person covered are stated in the Bill, and particularly closely in the Schedule, but they are, broadly, those who on account of their age when the National Insurance Act, 1946 came into operation were not, and could not be, insured under the terms of that Act.
First, I pay tribute to my hon. Friends the Members for Abingdon (Mr. Neave), for Worthing (Mr. Higgins) and for Farnham (Mr. Maurice Macmillan), who have sponsored the Bill on previous occasions, to my hon. Friend the Member for Tynemouth (Dame Irene Ward), and to the late Mr. Robert Mathew, who introduced the Bill but was prevented by a General Election from having a debate upon it.
The collective history of those Bills makes sad reading. One of them was filibustered, and three were defeated by Government whipping. Yet I shall try my best to move the Second Reading not in a partisan spirit, for I believe that in reality the dispute is not between the parties but between, on the one hand, the back benches and overwhelming feeling of the House and, on the other, the Government. I do not even despair of hearing the Minister say that the Government have had a change of heart and are prepare to let the Bill go to Committee and, perhaps, find its place upon the Statute Book before time runs out for too many of those who would benefit under it.
I introduce the Bill, first, on the ground of simple humanity. Those who would benefit under it are all old. Their 1947 average age now is over 87. Many of them are in need, and the vast majority feel that they have been betrayed by the system in Britain.
Second, I introduce the Bill again this year because of the urgency of the matter. Each year, about 20,000 of those who would benefit under a Measure of this kind die. It is right that we should each year attempt to carry a Bill to the Statute Book.
One of the main inspirations for me in my party is the concept of one nation. Anything which tends to divide groups of people from the main body of society is to be deplored, and it is the duty of politicians and the House to try to put it right. I am conscious, too, of the need in politics to push where possible at a door which is beginning to open. I am not without hope, as I say, that the Government may yet have been persuaded by the strong feeling on the back benches and in the country as a whole that the time is right for a Measure of this kind to be enacted.
There are about 120,000 people now surviving who would benefit under the Bill. As I say, their average age is over 87, and to give each a full retirement pension would cost the National Insurance Fund in all about £30 million per annum. But there would be a consequential saving to the Supplementary Benefits Commission of about £14 million. In the Explanatory Memorandum the figure is given as £12 million, but the latest information given in a Written Answer, for which I am obliged to the Minister, shows that the saving would now be £14 million.
Thus, if all these people had a full pension, the total net cost would be only about £16 million, and the Schedule makes provision for reduced pensions in some circumstances, so that it would be considerably less than that. Moreover, it is in the nature of things a cost which would quickly wither away. In five years the total cost will be negligible.
It all seems so simple. One might expect it to have the unanimous support of the House. Yet year after year Governments have advanced arguments against it. First, it is said—this is the argument put in debate and in letters to those who take the matter up wih the Ministry—that by passing a Measure of this kind we should in some way be 1948 undermining the whole contributory principle behind the National Insurance Fund. Yet this is not so. There is no inviolable contributory principle behind the National Insurance Fund. Already, the Exchequer subsidises retirement pensions. According to the latest figures I have, it subsidises them to the extent of £2 7s. a week for a single person and £5 12s. for a married couple. So that element at least of the retirement pension has never been contributed to by anyone. It is subsidised from general taxation.
Those who would benefit under the Bill have all paid taxes, and paid taxes for much longer than the mass of the population. Why should they not be entitled at least to the subsidy element in the retirement pension as it is today?
The second argument, which is even more specious, is that if we help these people there will be others who must be helped in the name of equity. My attitude is that I aim to help this group of people. If we always took the line that we could take no step of social advance in a particular case unless we advanced on a broad front, we should never get anywhere in social reform. So let us concentrate our attention today on those who would be helped under the Bill, deal with the arguments for and against helping them, and come to a decision.
In preparing for the debate, I read all the debates on the Bill in previous years. The point which I want to make again was made most tellingly by my hon. Friend the Member for Farnham when he moved the Second Reading of the Bill last year, when he said:Jam tomorrow has a very small chance of appealing to those who are going to die tonight."—[OFFICIAL REPORT, 7th February, 1969; Vol. 777, c. 740.]As I said earlier, 20,000 of those who would benefit under the Bill die each year.
During the debate on public expenditure last week the Chief Secretary to the Treasury said:What I am saying is quite to the contrary—that there were certain services which were not provided for and which had to be made good, and rapidly. I have already referred in this situation to 'cries from the grave'. One cannot wait for ever without increasing old-age pensions. The purpose is no longer served if one does."—[OFFICIAL REPORT, 22nd January, 1970; Vol. 794, c. 745.]1949 That argument, advanced in those circumstances, applies particularly to those involved in this Bill.
Another argument which is sometimes advanced against a Measure of this sort is that those who would benefit under it can in any case get supplementary pensions. Of course they can, but we are talking about—and we should recognise this—a group of people who have a different attitude from the mass of the population towards supplementary pensions. I regret as much as anybody does that they do not feel that this is something which they get of right, but it is no good trying to deal with the world as one would like it to be. These people grew up at a time when supplementary pensions, as they are rightly called, were known as assistance, and many of them do not like what in their terminology is assistance.
§ The Minister of State, Department of Health and Social Security (Mr. David Ennals)
I am sure the hon. Gentleman will accept that a substantial proportion of the people about whom he is talking already use the right to draw supplementary benefits.
§ Mr. Scott
That makes it all the more important to make provision for all these people, and not only for those who are prepared to come forward. I am not saying that this applies to everybody. There is no universal argument. To judge from the correspondence that I have had, a substantial proportion of these people feel deeply and passionately about this, and many of them are not prepared to apply for what they regard as assistance.
The argument is also advanced that they have capital resources. Some of them do, but this group has suffered more than any other over the years from the ravages of inflation and I suggest that the way in which the Supplementary Benefits Commission treats capital needs some examination. If I understand the situation aright, the first £300 of capital is ignored, the next £500 is treated as if it brings an annual return of 10 per cent., and anything over that is treated as if it brings a return of 26 per cent. per annum on the capital. Many of the people in this group bought War Loan, which brings a return of about 3½ per cent., so it is nonsense to talk about their capital resources.
1950 There is an individual answer to this. I do not do this very often, but the other day I was reading Professor Titmuss' collection of essays, "Commitment to Welfare", where he argues strongly for an approach to social welfare on the basis of group needs, rather than individual needs, and the nature of the residual poverty in our society today is such that it is very susceptible to this approach. Professor Titmuss goes on to say that Socialist policies in social welfare should be pre-eminently about equality, freedom, and social integration, and on those grounds I should have thought that the Government would look more favourably than they have done hitherto on the arguments for the Bill.
I cannot overstate the impact that introducing the Bill has had. I have had a mass of correspondence from people who would benefit under it. One gets some idea of the deepness of their bitterness at the way in which they have been treated, particularly those who were not allowed to join initially, and the widows of those who were unaware of the choice made by their husbands, and of which they knew nothing until it was too late. From one lady I had the form which she received in 1939, which she had kept for 30 years, telling her of the decision that she could not be part of the scheme.
These people resent feeling outsiders. They feel particularly bitter this year when they see the way in which the Government have allowed their prices and incomes policy to become a manifest nonsense, and when it is clear that almost anybody can get an increase in income if he acts ruthlessly and toughly about it. They feel even more left out as a result of all this.
They have suffered from inflation more than anyone else, and their attitude is summed up by one person who wrote to me and said:Their voting power is negligible and they have no weapon with which to enforce their demands, and no argument except that, having done far more than their days' work they are left neglected and forgotten by a land which they have served well but which rewards the strong and ruthless rather than the deserving.These people waited with baited breath for the Government's much-vaunted pension scheme, and they are now utterly let down and despaired to find that it does nothing at all for them. What use 1951 is 1992 to those who would benefit under this Measure? Just before the last General Election the Prime Minister was asked in a broadcast whether a Labour Government would give pensions to the over-80s, and he said, "Yes, when the country can afford it". Is the Minister really going to say this afternoon that at a net cost of about £12 million the Government cannot afford to treat these people decently? It has become clear that the next Conservative Government will act in this matter. Nevertheless, because of the time-lag which there must inevitably be before the return of that Government, I hope that we can reach a decision today.
This afternoon, inevitably, we must have a relatively short debate, but this is a matter and an issue which has been debated for many hours over the years. All the arguments have been aired, and although this afternoon's debate must be relatively short, there can be no reason at all why we cannot reach a decision today and send the Bill to a Committee. It is therefore with much humility that I ask the House to give the Bill a Second Reading.
§ 2.48 p.m.
§ Mr. William Hamilton (Fife, West)
The hon. Member for Paddington, South (Mr. Scott) has a reputation for a liberal attitude to this and other questions. I think that he is one of the more humane Members on the other side of the House, but it makes us on this side of the House a bit sick to hear that humanity apparently began in 1964. This is the seventh Bill that we have had on this subject since 1964, but there was not one in the 13th years when the Tory Party formed the Government. On the contrary, the now official spokesman for education in the Tory Party, the hon. Lady the Member for Finchley (Mrs. Thatcher), went out of her way in 1962 to say that this could not be done under the existing National Insurance proposals. That was at a period of so-called prosperity, so why could not the Conservative Government do it then, just as the hon. Gentleman has asked why the Labour Government will not do it now? We had then had nearly 12 years of Tory Government. Mr. Harold Macmillan was going around saying that we had never had it so good.
§ Mr. Airey Neave (Abingdon)
It the hon. Gentleman aware that there is no record of the Labour Party in opposition having raised this matter or complained about it?
§ Mr. Hamilton
I am not saying that there is. I followed the hon. Gentleman in a previous debate on the same point. Neither he nor any of his hon. Friends when the Conservatives were in power between 1951 and 1964 introduced a Bill on this subject, and nor was any such Bill ever accepted by the Government. Let us not have such hypocrisy and humbug from right hon. and hon. Members opposite.
§ Mr. Geoffrey Wilson (Truro)
Is the hon. Gentleman aware that, until my hon. Friend the Member for Abingdon (Mr. Neave) introduced a similar Bill, the vast majority of us were unaware of the problem?
§ Mr. Hamilton
That is the point I am making. Hon. Members opposite were utterly ignorant of the poverty in the country when Mr. Harold Macmillan was going round saying that we had never had it so good. They were not aware of the existence of this minority, in fact, until they got their backsides on the Opposition benches, when their social consciences started to trouble them.
§ Mr. Fergus Montgomery (Brierley Hill)
The hon. Gentleman keeps parading Mr. Harold Macmillan before us, but at that time most people would admit that they had never had it so good. The point is that, during the present Government's term of office, the cost of living has risen so much that these people are suffering greatly.
§ Mr. Hamilton
When Mr. Harold Macmillan made his claim in the early 1960s, the Tories had been in power for 10 years. Inflation had resulted in a fall of 6s. in the value of the £ between 1951 and 1962. Yet Mr. Macmillan was making his claim that we had never had it so good. The group of people with whom hon. Members are so concerned now had suffered that kind of inflation over a period of 11 years, but there was not a cheep from any hon. Member opposite about the subject at that time.
§ Mr. Tim Fortescue (Liverpool, Garston)
The hon. Gentleman should turn his not inconsiderable eloquence and 1953 ability to the present and future and not to the past.
§ Mr. Hamilton
The hon. Gentleman wants to forget the past, and understandably so. The Opposition would like to forget their record in Government over 13 years and I am reminding them of it. One is constantly finding, when discussing poverty and the hardships of minorities, that it has suddenly dawned on hon. Members opposite that such minorities exist. But they also existed before 1964. Why did the Conservative Party do nothing about them then? The answer, given by the hon. Lady the Member for Finchley in 1962, was that the existing national insurance system was—as it still is—based on the contributory system. Whether we like it or not, that is the case, and we have to look at the national insurance system as it is today and as it will be even when the Government's new scheme comes in. The benefits will be related to contributions still.
Hon. Members opposite talk about the present system resulting in division. I could spend the rest of the debate going through the categories of people who, for one reason or another, have no pensions or national insurance benefits or who get reduced benefits because they have not been paying contributions or have not the contribution qualifications which entitle them to full pension.
Is this Bill now the official policy of the Tory Party? If it is, then presumably other groups of people who have not contributed are going to get free pensions. Are all those groups of people, who, for one reason or another have not contributed and will not contribute to the national insurance scheme, to be entitled automatically to pensions? We have a right to know, because, if they are not, then they will be entitled to say to the next Tory Government, if we get one, that if that Government are going to give pensions to the over-eighties in this group they should pay them also to the other groups who have not contributed. This proposal will be a breach of the principle that contributions lead to pensions, and obviously these others will set up their own pressure groups. I wonder how many Tory Members will then introduce Bills to provide pensions for these groups. I doubt whether there will be a single 1954 Bill—which shows the shallowness, hypocrisy and humbug of this whole exercise.
§ Mr. Terence L. Higgins (Worthing)
Will the hon. Gentleman, when in Opposition, propose to introduce such a Bill?
§ Mr. Hamilton
I have been campaigning for some of these minorities for a very long time and I hope that no one will accuse me of inhumanity towards them. What I object to is the hypocrisy of hon. Members opposite. The hon. Gentleman's question is hypothetical in any case because the present Government will still be the Government after the next election.
The Conservatives have suggested all along in successive debates that they are going to base their social insurance policy on selectivity. In other words, they are going to pay benefits based strictly on need. Some of the people in this group who are the subject of the Bill are, in fact, genteel old ladies of substance. Are hon. Members saying that they are going to weed out these old ladies and not allow them to get this pension they propose? Their policy is quite clear. They say that money is being wasted in social services. Is that not so? I hope that they will tell us.
Apparently they are not prepared to say now that money is being wasted on the social services, but they have said it before. They have said that, to eliminate the waste, they will pay benefits on need. That means selecting people, weeding out the wealthy from the less wealthy, and I am pointing out that some of the people concerned here are comfortably off, are relatively wealthy compared with others. Some are very wealthy compared with some of my constituents who are working.
The Tory Party is saying that it will indiscriminately give pensions to people who might be quite wealthy, thus increasing public expenditure by £16 million or £14 million, and it all adds up, while at the same time reducing taxation. The two just do not add up.
§ Mr. Hamilton
The Tory Party did not do it before. I will give an example. There was a report on conditions in primary schools just prior to the 1964 election. It was such a damning report that the then Tory Government prevented its publication until after the election. The condition of primary schools then is why we have such a damnable problem in education now. That is why the right hon. Gentleman the Shadow Chancellor of the Exchequer, when discussing public expenditure recently, went out of his way to say that the Tories would substantially increase expenditure on education.
Now the Tories are saying that they will increase expenditure on social insurance without contributions. We have had similar claims about other forms of public expenditure. I am saying that they cannot do these things and kid the people that they will reduce taxation.
I refer to a comment in the election manifesto of the Tory Party.
§ Mr. Hamilton
This is the 1966 manifesto and so it is up to date, unless policy has been altered. We shall find out after the return from Croydon on Monday what is to happen in the next election—I wonder whether we shall. It says:An entirely new social security strategy designed to concentrate better care with biggest benefits on those most in need …If that does not mean a test of need, I do not know what does. The Bill does not make a test of need. The only test is that of age.
To some extent, I agree with those who say that there may be a case for having some system of grading pensions according to age, because this group, with other groups, has needs which change in character as the group gets older. People of this age are more likely to need things, like home helps, meals and so on, than cash. This kind of assistance cannot be provided by a Private Members' Bill produced purely for party political purposes.
§ Mr. A. P. Costain (Folkestone and Hythe)
Would not the hon. Gentleman agree that one of the greatest needs of this group is for heating and that one of the greatest cost increases has been that 1956 of heating, with a steep rise in the cost of coal?
§ Mr. Hamilton
We can all argue about increased costs. Increases have consistently occurred under all Governments since 1945 and no party can pretend to have the complete answer to the problem of inflation.
I am saying that there are groups in society—I see them in my constituency—including people between 80 and 90, such as those whom the Bill mentions, who, if asked whether they would prefer an increase of 10s. or £1 in their pensions or several physical comforts of one kind or another, would opt for the latter.
I want to refer to the principle of selectivity. At its conference in 1968, the Tory Party underlined what was said in the 1966 manifesto when it said that the next Conservative Government would concentrate available resources on those who needed them the most. That cannot be translated into a policy which can be squared with the Bill, because the Bill does not base pension on proven need. I can produce people in my constituency—no doubt other hon. Members can—who are under 80 and even under 60 and who have greater need than this group.
If one wants to base benefits on need, the machinery is already there in the form of the Supplementary Benefits Commission. There is not a better way, anyhow within the social security system, for basing benefits on proven need than the Supplementary Benefits Commission. Why it is assumed that we ought to treat this group, minority group though it be, differently than anybody else receiving supplementary benefits, I do not know.
§ Mr. Montgomery
The only sin of these people is that they were too old to join the scheme in 1948; they had no option.
§ Mr. Hamilton
Some had. Some could have voluntarily contributed before 1948 and chose not to do so. This is another category. In trying to have selectivity we should find out from among those people which of them could have voluntarily contributed before 1948 and did not. Are we to give them pensions too? This is not as simple a 1957 problem as hon. Gentlemen would have us believe. We all know in our constituencies that the old-age pension is inadequate, I would say grossly inadequate. It is far better than what it was when hon. Gentlemen opposite left office in 1964, but it is still inadequate.
That is the main reason why so many old-age pensioners are on supplementary benefit. Why should it be assumed that the needs of those people are any less urgent than the needs of this category about whom we are talking? They all have access to the Benefits Commission, they wall all be treated alike, they are all ensured of exactly the same standard. Why should it be assumed that the old lady in Bath or Bournemouth should be treated better than the old lady in West Fife? This campaign started on the South coast. [Interruption.] I am stating a fact, I am not making any adverse comment. It did not start in Fife, in the mining North. It is among the genteel old that it started.
§ Mr. Hamilton
The hon. Member is entitled to say that, I have said it before and I do not object to hon. Gentlemen giving me as good as I have given them. But they should not object when I seek to lay bare their own acts and to expose them as humbug and cant, in seeking to introduce this Measure for the seventh time in four or five years.
The cost of this Bill is to be a net £14 million. Whenever we discuss public expenditure we are entitled to ask whether that money could be better spent in other ways. I believe that there is a whole host of ways in which it could be better spent. If we look at the various areas of poverty in the country, or of deprivation of one kind or another I would go so far as to say that it would be better spent on nursery education and nursery schools. One of the most grossly under-privileged sections of our community is the under-fives. Let us not assume that the over-80s are the most deserving of our sympathy. There are those of us who think that the under-fives are more deserving and they have not got a vote at all.
§ Mr. Hamilton
Some of them have not. Most of them have not got the educational and home facilities to which they are entitled. Some of us who feel strongly on educational matters would give this category a higher priority than the group covered by the Bill. If there is £14 million of public expenditure going spare I say let us spend it on nursery education, because the group mentioned in the Bill can always fall back on supplementary benefits. I respect the hon. Gentleman's intentions in introducing this Bill, but I believe that he ought to think very carefully before pressing forward with such a Measure.
§ 3.10 p.m.
§ Mr. Paul Dean (Somerset, North)
I would like to apologise to you, Mr. Speaker, to the House and to my hon. Friend the Member for Paddington, South (Mr. Scott) for not being here during the early stages of the debate. I was detained on urgent business in another part of the House.
I do not wish to detain the House for long, but I do want, first, to refer to what I thought was the rather sour speech of the hon. Member for Fife, West (Mr. William Hamilton). I would like to congratulate my hon. Friend the Member for Paddington, South on bringing forward this immensely important piece of social reform.
The subject matter of this Bill has been debated many times in the House during recent years, but this is the first time that we are debating it since the appearance of another Bill which gave the Government the chance, if they chose to take it, to deal with the problem of the non-pensioner. I am, as always, an optimist, and I hope that the reason they did not deal with this problem in the Bill which is now upstairs is that they realised that my hon. Friend would give them the opportunity to do it today rather more speedily than they would have been able to do it had they introduced a Clause in their Bill in Committee.
It shows the Government's extraordinary sense of priorities when they introduce a major Measure of reform of our national insurance scheme, offering substantial increases in pensions to come into full operation 20 years' hence, with big increases in contributions in the meantime, and yet people who are entirely excluded from the scheme are left outside.
1959 The problem dates from 1948 when the then Government introduced the Beveridge reform of our social insurance arrangements. The point about this category of people with whom my hon. Friend's Bill deals is that they were debarred by the 1946 Bill from contributing to the then national insurance scheme and thereby building up entitlement to pension. It may well be said that the reason they were left outside is that they were over retirement age and, therefore, by definition, could not be brought into a scheme which involved contributions for retirement before the age of retirement.
I concede that at that time there may have been some weight in the agument, although it should, even then, have been possible to foresee that this problem would build up and would become more acute. There have been many increases in the retirement pension since the 1946 Bill was introduced and those increases have been paid for, to an overwhelming extent, not by the contributions which those people have made, but by the contributions being made by present contributors, by the present working population and by present taxpayers.
The hon. Member for Fife, West says that these people are no more deserving of attention than other categories. If existing pensioners had paid fully for their pensions, I would accept his argument and say that there was no case for the Bill. But, in fact, as we know perfectly well, the existing generation of pensioners have not paid for their pensions through their contributions. The overwhelming proportion of the pension which present pensioners are getting is not met from the contributions which they made. This is the sense of unfairness and injustice which non-pensioners feel.
§ Mr. Dean
The hon. Gentleman is looking at the past. What matters is the future. I do not disguise for a moment that Governments of all parties have neglected this problem, and if it will make the hon. Gentleman feel any happier I will concede that to him.
But what non-pensioners want to know is what the House of Commons will do today when it has the opportunity to put 1960 right something which perhaps should have been dealt with before. It is easy for those of us who have become Members recently to say that; we did not carry the responsibility at the time. But, whatever the past may be, there is no doubt that the argument gets infinitely stronger as pensions are increased, as they probably should be increased, from the contributions made by the present working population and the present generation of taxpayers.
The hon. Member for Fife, West also said that one cannot show effectively that these people are most in need. What one can show conclusively by looking at the figures is that the higher the age of retirement pensioners, the bigger the proportion of those who are in receipt of supplementary benefit. That shows fairly conclusively that it is not only belated justice to these non-pensioners, but it also fits in effectively with the policy, which we on this side advocate, of concentrating resources on those who are most in need.
It is for that reason that we say—and we are committed to seeing—that the non-pensioners, those who were not able to join the scheme in 1948, should get a pension as of right under the national insurance scheme. I hope that, in replying, the Minister of State will take this opportunity to ensure that that is done, and done speedily.
§ 3.16 p.m.
§ The Minister of State, Department of Health and Social Security (Mr. David Ennals)
It might be for the convenience of the House if I intervene at this stage and deal with a number of the important points which have arisen. Although I am not advising the House to accept the Bill, I welcome the opportunity of the debate on the problems of old people in our society. I very much agree with the point made by my hon. Friend the Member for Fife, West (Mr. William Hamilton) concerning his own sense of compassion, which I acknowledge for a number of different reasons.
The very fact that there are so many still living today in the particular age group that the hon. Member for Paddington, South (Mr. Scott) is concerned with is an indication of great change, of the fact that people are living much longer and of an improvement in general standards of life and general standards 1961 of health, for which all of us must feel pride and take credit because this reflects upon the success of the National Health Service and the Welfare State in general.
Of course, there is a responsibility upon all of us as a society to care for this increasing proportion of society who have reached retirement age. We know that the figures are steadily going up. I would guess that in a little over 10 years' time, we may have perhaps 9½ million people who will have passed retirement age. This imposes on the whole of society a heavy responsibility.
The hon. Member for Somerset, North (Mr. Dean) made some interesting points about whether those who are older need greater financial assistance than the younger old-aged. From the sort of evidence that I have, I do not think that the case is proved that a person of 75 or 80 necessarily needs more cash. They may need much more care, but whether they need more cash I would not like to be certain. My right hon. Friend has certainly not closed his mind to the prospect that there may be such a case.
We must look at the proposal which has been made by the hon. Member for Paddington, South, and those of his predecessors who have introduced similar Bills in the past, within the context of the general condition of old people. This, again, is a point on which I much agree with my hon. Friend the Member for Fife, West. Cash is, of course, important, but it is by no means the only factor in determining the quality of life of elderly people. Most people, perhaps, above all, in their older years, want independence.
If I may pay a compliment to the noble Lord the Member for Hertford (Lord Balniel), who speaks on these matters and who took part in a recent Conservative Party political broadcast, on which I congratulate him on his rôle as a commentator—he has a considerable future rule in that category even if not elsewhere—one thing that came out of his interesting interviews was the sense of pride and independence of elderly people. We need, therefore, to look at the question of cash within this broader context.
It would be a great pity if the welfare of older people were to become, in the months leading up to a General Elec- 1962 tion, a sort of issue to be kicked around as if they were involved in an auction sale between the political parties. The Leader of the Opposition, very recently, has made a number of speeches and broadcasts on the subject of old people, as if somehow the conscience of the nation in these matters was vested in the Conservative Party. A newspaper cutting of his most recent speech says:Help for the aged by the Tory Party".I did not think that this will cut much ice, particularly after the intervention by the hon. Member for Truro (Mr. Geoffrey Wilson), pointing out that when the Conservatives were in office they did not realise the nature of the problem.
In looking at the provision, cash payments must be seen in their broadest context. I will deal with these other considerations since special priority has been given to them in recent Tory Party publicity.
It is extremely important that people in their old age should be able to live in some degree of independence, and there has been greatly increased provision of housing for elderly people since 1964. During the last few years a quarter of all houses provided by local authorities have been suitable for the elderly. Then, to take warden supervised dwellings, in 1965 there were only 63,000 elderly people with this kind of independent provision. On the present showing, by 1971 there will be 160,000—almost three times as many. In 1964, there were 1,652 old people's homes. The number has now risen to 2,146.
In regard to the meals on wheels service, which has been mentioned by the Leader of the Opposition, the number of meals provided in people's homes and elsewhere have gone up from 5.5 million in 1964 to a figure of 12.6 million in 1968, an increase of well over 100 per cent. If we look at the way in which these are taken into clubs by local authorities and private voluntary organisations, the figures have gone up from less than 1 million in 1964 to very nearly 6 million in 1968. This is a tribute to the voluntary organisations as well as to local authorities.
The number of home helps has increased from 282,000 in 1964 to 354,000 in 1968. Therefore, in each of these areas that make a direct impact on the 1963 problem of the oldest people who need a greater degree of social care and welfare provision there have over recent years been very substantial strides forward. If we compare the record of general welfare provision by local authorities, in 1963–64, the figure amounted to £33 million and in 1968–69 it had increased to £57 million. The real increase in these last five years has run at about 7 per cent. This increase in annual growth is reflected as going on into the future.
Although nobody on either side of the House could conceivably be complacent about the provision which we as a society have to give to elderly people, the very record of my right hon. Friends and the plans which they have made for the future show that we are by no means satisfied. We are determined to proceed with this matter.
This brings me to look at the partciular points in the Bill and to the speech of the hon. Gentleman who moved the Second Reading. One inevitably looks at cash payments from two different points of view. One is in regard to contributory pensions for those who have made contributions to national insurance, and the other is the non-contributory pensions for those who have not contributed to national insurance. This is a simple dividing line. Once the distinction is blurred, it destroys the whole concept of the insurance principle.
Frankly, I am staggered by the arguments of hon. Gentlemen opposite. The insurance principle was the position always taken on the Conservative benches when they were in power.
One hon. Member chided us because we had not sought to change this division between contributory and noncontributory pensions. We have not done so, because we accept the insurance principle—as did the Opposition, until, suddenly, they found themselves in the wilderness. Then there is this revolutionary change, they stand all their previous arguments on their heads and the country is expected to take it all seriously.
The Opposition always took that line even when they were making poorer provision for those who had contributed to national insurance and for those who had not and who were receiving national assistance. Since we have come to power 1964 we have made substantial improvements in both types of pension. We have made considerable improvements in national insurance—only in November last came the third increase in the general level of national insurance. In the new Bill, to which particular reference has been made, pensions are to be uprated every two years, and increased provision is made for those who are not on pension, and with whom this present Measure is concerned.
The attendance allowance will be made available to those who are in such great need that they require virtually constant supervision. This allowance is not limited to children and those in middle age. A substantial proportion of the new attendance allowance, which hon. Members opposite have welcomed, will go to people who are so old that they need constant attention. That allowance will be administered not only under national superannuation but correspondingly also under supplementary benefits.
The Government's provision for noncontributory pensions, the improvement in the level of the supplementary benefit scale rate and improvements made by way of much more generous disregarding of savings have been especially helpful. For some of those of whom we are talking, who may well have had private resources, because they chose not to resort to public funds, there is improved allowance for investment and savings.
These improvements, together with increases in family allowances and the introduction of the earnings-related supplement to sickness and unemployment benefit, are all part of the general improvement that has affected those who are in poverty and, I believe, totally belie the recent allegation by the Child Poverty Action Group that, somehow or other, there is now a greater degree of poverty in Britain than there Was five years ago. I do not think that anyone except some academics would believe that.
The issue raised by the Bill—the provision made for elderly non-pensioners—has, as we know, been debated many times before, but it is evident that there is still a great deal of misunderstanding about the extent of the non-pensioner group. It is estimated that there are now about 120,000 people who were 1965 not able to become insured under the present national insurance scheme when it began in July, 1948, because they were then already over the minimum pensionable age—65 for a man and 60 for a woman—and were not insured under earlier schemes of contributory insurance. But this is the total number of present "non-pensioners" who were over pension age in 1948.
My Department does not hold the necessary information about these people individually so that this or any other Government could distinguish between those who were not previously insured because they were excepted or exempt from insurance under the old schemes, and, on the other hand, those who had an opportunity to become insured declined it or who let their insurance lapse. It is doubtful whether the detailed information needed to make that kind of distinction between individual cases is available from any source whatever. When hon. Members opposite say that their special concern is to help those people whose exclusion from the old insurance schemes deprived them of the opportunity to become insured under the present scheme, I must tell them that it is extremely unlikely that that distinction could be made.
It follows that even if my right hon. Friend were able to accept this as the right way of helping those among the very elderly non-pensioner group who may genuinely feel a sense of grievance—and I know that the hon. Member is right when he says that some do feel a sense or grievance about this matter—it could not be done unless such pensions were mete payable for the whole group of 120,000 elderly non-pensioners, including those who had an opportunity to become insured or to remain insured and did not take it.
The hon. Member said that pensions payable on this basis would cost about £16 million a year after taking into account the savings on supplementary benefits already in payment to this group. I agree with his figures; in fact he got them from me. But that could not be the end of it, and I cannot accept his suggestion that somehow we can draw a dividing line there without creating a great sense of hardship and grievance among others. If he says that there are some of this group who feel a sense of grievance, I reply that the measures 1966 which he has proposed, if they were to stand on their own, would create a great deal of grievance among many other people in our society.
Once the principle of paying national insurance pensions to non-contributors who had declined an opportunity to become insured were admitted, there would be a case, which I think would be unanswerable in logic, for paying pensions on the same basis to a much larger group of people who have failed to qualify for retirement pension. That group, which we estimate to number about 180,000, consists of people who, though insured under the present scheme, and therefore contributors, failed for one reason or another to pay sufficient contributions to qualify for pension—and many of them, possibly constituents of my hon. Friend the Member for Fife, West, did so because they could not afford to pay the contributions.
If the hon. Member's case were to be conceded for that group of people who had never paid a contribution and it then left a larger group of people still not entitled to a pension even though they had contributed—but not enough—either we should have a great sense of grievance by many who perhaps have a small income supplemented by the Supplementary Benefits Commission or both tasks would have to be tackled. And if we were to tackle the second task and pay retirement pensions to people in this group, it would increase the total cost of any concession to £37 million, net of savings on supplementary benefits—and the greater part of the cost would be a continuing commitment, because some of these people are younger pensioners.
The argument may have been made that somehow there ought to be special care for those who are very old, but I do not think we decide that a pension should be due to people purely because of their age. There are certainly people, possibly 65, 70, 75 or 77 years old, who do not come into the hon. Member's category but whose needs may nevertheless be just as great as those of the other group. My hon. Friend was right when he said that the hon. Member's criterion was purely that of age, with no other consideration at all.
Although this group are not reached by the insurance scheme, I completely reject the suggestion that people who 1967 have failed to qualify for a national insurance retirement pension, whatever the reason, are excluded from our social security arrangements. There is provision, it is selective, it helps most those with least resources, and in this way it can be seen to be fair, not only to those who benefit, but also to those who meet the cost.
The plain fact is that none of these old people need be without an adequate income. This is the side of the story that successive hon. Members opposite when moving Bills have failed to accept. There exists now the Supplementary Benefits Commission, which since 1966 has established that a supplementary pension is not a form of charity; it is not something for which people have to go on bended knee. It is a right. This is one of the proudest achievements—I will not say "of this Government", but of Parliament.
We went through long generations when there were large sections of society who almost had to crawl, who had to collect the crumbs because they were in hardship. My right hon. Friend the Member for Lanarkshire, North (Miss Herbison), who was then Minister of Pensions and National Insurance, said that society has itself completely accepted that every member of society who has a modest income has an entitlement.
The hon. Gentleman says that some of those of whom he is thinking perhaps do not fully understand their entitlement. We have done all we can, and we will go on doing all we can. I wish that hon. Members opposite would do all that they can. Instead of making a great political fuss and saying to these people, "What you ought to have is a national insurance pension but these people on the other side of the House are denying it to you", hon. Members opposite, who know of people who have a modest income, whether they be over 60, over 75, or whatever, should encourage them to exercise the right that this Government have provided for all citizens. Once it is said that these people are in a different category, and are in some way distinguished from others who are in need in our society, the concept of right which was written into the 1966 Act is undermined.
1968 The hon. Member for Paddington, South said that the insurance principle had gone by the board, that pensions were largely paid for from taxation. It is true that there is a considerable taxation element within our national insurance. And the whole of supplementary benefit is paid for from taxation. This emphasises the right that these people have.
It is not that these people have consciously turned their backs on the Supplementary Benefits Commission. We estimate that there are about 60,000 old people who were over pension age in 1948, and who have no retirement pension, but who have a supplementary pension. So about one-half of the 120,000 "non-pensioners" in fact receive a pension from my Department.
Therefore, let us not blur the issue or confuse the public by saying that we are denying a pension to any one of these 120,000 people who may be in need. The question is—do we provide a national insurance pension to sit on top of whatever else might be their source of income?
Of course there are a substantial proportion of these people, as there are in any other group in society, who have substantial resources. What sense does it make—it seems to me that I am presenting arguments I normally hear from the other side—if there is a certain sum of capital available, consciously to give a pension, regardless of need, to some who we know are not in need?
In 1966 there was a great leap forward. There are since 1966 well over 400,000 more old people receiving a supplementary pension than were receiving national assistance only three years ago.
§ Mr. Ennals
The hon. Gentleman shows how little he understands this. He is wrong. The real purchasing power of the supplementary pension is just over 20 per cent. above what it was when we came into power in 1964. So it is not a question of rises in the cost of living.
Two things have happened. As we have raised the level of supplementary benefits to a more generous level, more people have become entitled. Also, there has been a flow of people who were previously in need, but who did not use national assistance and who, because they 1969 have accepted the principle of entitlement, have come forward. I appeal to the House and to any others who have influence with the public, where they know of an old person in need, to urge such a person to go to an office of the Supplementary Benefits Commission and see in what way he can be helped. We take a generous, understanding, human approach to these problems, and I can assure any people in difficulty that they will find a sympathetic response.
I believe that there is a change in attitude. I believe that the views expressed by the hon. Member, and "hearheared" by some of his hon. Friends, are old-fashioned. They have not seen what has taken place. They still think that supplementary benefits are like the old national assistance. We have to educate them before some of them can educate their constituents.
Looking at all those elderly people over pension age who do not receive a retirement pension and who are receiving a supplementary pension, the average amount of their drawing each week, taking into account the increases last November, is now in the region of £5 11s. This gives them a higher income than they would receive if, instead, their income came from a retirement pension at the full standard rate. They are, therefore, getting from the Supplementary Benefits Commission a higher entitlement than they would have if hon. Members had succeeded in providing a flat-rate £5 pension to all those in need.
It is demonstrably false to say that any group of elderly people is left out of our social security provisions. As has been said, the Bill is not based on need. It is based purely on age. Of course, some of these people also have benefited from a number of other significant measures which have been taken by the Government—the raising of age relief for income tax from £360 single and £57.5 married in 1964, up to £425 and £680 respectively in 1969; Acts for which we gave authority to enable local authorities to provide concessionary fares for elderly people; the 1966 Rating Act, which now gives benefit to about 900,000 people on modest incomes, and this must include again many of those for whom the hon. Gentleman is concerned.
The Conservative Party is traditionally the party of selectivity. My hon. Friend the Member for Fife, West reminded us 1970 that there have been constant repetitions in election addresses and in statement after statement, sometimes attacking my right hon. Friend and myself, and the argument has always been that we should use the resources which the taxpayers and contributors provide to meet those who are in greatest need.
I wonder why it is that the Conservative Party should now totally drop its arguments in this respect. Why should Conservatives, of all people, argue not only for a national insurance pension for those who have not contributed, but urge us to give them one regardless of what may be quite a substantial income in the case of many of those who would benefit if the hon. Gentleman got his Bill through? Surely if additional public funds are available, they should be used at this stage to raise the level of supplementary benefits as was rightly done in November.
I believe that the Conservative Party's attitude to public expenditure is utterly irresponsible. We are constantly hearing from one Opposition Front Bench spokesman or another demands for higher expenditure. We see them in debate after debate urging us to do more of this, that and the other. This Bill is is a good example.
They are urging a substantial degree of public expenditure upon us. At the same time, in general, they call for a slash in public expenditure. Those two attitudes do not match up. Neither is it consistent to argue, as they constantly do, that we should spend more on one thing and another but that, if they were in power, they would be able to bring about substantial tax cuts. They cannot expect to fool the country with that sort of argument.
§ Mr. Ennals
I shall be interested to see two things. One, we shall shortly produce ourselves the list of new items of expenditure in the home and overseas fields. Second, I should then like to be able to compare these figures with the Opposition's claims when they tell us what forms of public expenditure will 1971 be cut. It is only when they come down to specifics that we can see what the effect of their cuts would be on some of the public services, for which we feel a great sense of responsibility.
The Conservatives are building up a monumental bill for new expenditure and, at the same time, are promising tax cuts. I certainly absolve the hon. Gentleman the Member for Paddington, South—and he may think I am over-kind—from the charge that he has introduced the Bill for political purposes. But I cannot absolve many of his right hon. and hon. Friends. I believe that they are picking on an issue which they feel will have electoral advantage regardless of the principles on which it is based.
In conclusion, I say that not only is the group of people in question not excluded from the social security provisions made by this Government, but that this Government, in their new Bill, and in other ways, will constantly, as we have already done, expand our rôle of assisting people in need whatever their age and background. I am proud of my Government's record in this respect.
§ 3.47 p.m.
§ Mr. W. Howie (Luton)
This is an uncomfortable kind of debate to be holding in the House. It is uncomfortable because hon. Members on both sides have quite substantial records for supporting the wider expansion of social security benefits of all kinds. Sometimes, in the heat of polemics, we accuse each other of stinginess. In election campaigns one side says that the other would do no better. But in a very real sense hon. Members as a whole have an admirable record in this matter.
For that reason, I think it worth while to have a brief look at the history of the Bill. It has been said today, as it was said in debates over the last several years, that this Measure to provide an unearned pension to a certain limited category of very old retired people has seemed important to hon. Members opposite only in fairly recent times. As I recall it, a Bill of this nature appeared before us first in 1965, and on that occasion it did not go very far. It was not even debated properly.
Since then, this idea of an unearned retirement pension has been handed along the Opposition back benches from 1972 one hon. Member to another. Regularly, over the years, someone lucky in the Ballot has brought out the same Bill and given us the opportunity to make the same speeches as we made the previous year and the one before, and hon. Members opposite have made the same speeches and appeals. On each occasion, the Minister has put the whole matter into perspective.
After the brilliant speech of my right hon. Friend the Secretary of State for Social Services last year, when the arguments for this Measure were finally and utterly demolished, I am amazed that it should appear again this year. Presumably, my hon. Friend the Minister of State, having demolished the arguments once again, will be faced next spring with another Bill of the same kind coming from yet another hon. Gentleman opposite. [Interruption.] Does the hon. Member for Worthing (Mr. Higgins) wish to say something?
§ Mr. Higgins
As there was a filibuster on this matter in the first instance, and as the issue has been debated on several occasions, is it not highly desirable that we come to a conclusion this afternoon?
§ Mr. Howie
The hon. Gentleman knows that I have a feeling of friendship for him, and that I am interested in what he says, but he has been a Member of Parliament long enough to know what a filibuster is and that we cannot have a filibuster on a Bill which does not come up for proper debate. So he was wrong there, and untypically trying to make a clever point. Because it was untypical of him, he got it wrong.
As I say, I find this an uncomfortable sort of debate. [HON. MEMBERS: "Hear, hear."] I grant that to hon. Members opposite, because the House has an enviable record in social security matters. It always has had and, no doubt, always will. It is uncomfortable, therefore, to appear to be turning down a good case, to appear to be stingy when we might be open-handed. But this is 1973 only a superficially attractive case, though it is made more uncomfortable for mar y of us because, as the Bill has been handed along the back benches opposite to one hon. Member after another each successive year, it always seems to fall into the hands of the most reasonable and attractive hon. Members opposite, the ones whom we on this side like more than the others.
That is certainly true of the hon. Gentleman the Member for Paddington, South (Mr. Scott). He knows that I have as much respect for him as I have for the hon. Member for Worthing. I have said it not only here, but in public. [Laughter]
§ Mr. Howie
I am trying to get back to the Bill, Mr. Speaker, but my thoughts were momentarily drowned by the noise coming from the benches opposite.
I was saying that I respect the motives of the hon. Member for Paddington, South in bringing the Bill forward. As the Opposition are often accused of making politics on matters of this kind, it is important that we should record our respect for the motives of hon. Members opposite, whatever may be said in some of their speeches.
I come now to the provisions of the Bill which make it awkward to support. [HON. M EMBERS: "Hear, hear."] However worthy the motives behind it, one cannot escape the fact that the Bill impinges upon the whole insurance principle. I have always been a little reluctant to praise the insurance principle too strongly, because I think it is fair to say that never, since social security and pension matters came up for consideration in Parliament about 60 years ago, has a true insurance principle been involved in the system. The insurance contribution has always been regarded rather as something in the nature of paying the membership subscription of a club, and that by paying that subscription a person did not so much insure himself as buy the right to security cover in the form of unemployment, pension, or sickness benefit in due course, when required.
As has often been said, while the insurance contribution has not been true insurance it has been a central factor in 1974 our whole method of financing social security. We have always accepted—and this is so in the Government's new Measure—that social security should be financed largely on the "pay-as-you-go" method. That is the foundation of our system of social security. There is no disagreement between the two sides of the House on that. Those who are working pay taxes, and those who are retired receive the benefits. This is a reasonable way of running a pension system, and there has been no argument between us about that, until today apparently.
If there is a pay-as-you-go system for financing social security benefits, it is essential that people pay. A number of people involved in the Bill opted out. Not all of them did so, because many were excluded from the scheme for reasons beyond their control. A number, however, chose not to enter the scheme, and by so doing they more than forfeited their right to a pension at a later date. It was reasonable for them to opt out, and it was in their control so to do, but they did something else. By opting out of the pay-as-you-go system, not only did they sacrifice their right to a pension later, but they opted out of supporting those who were pensioners at that time. They did not undertake the responsibility while they were working of paying contributions and thereby contributing to the support of people who were retired.
Having opted out of paying their share of the pay-as-you-go system, they cannot now, at this late stage, opt in. Having opted out, they must remain out.
§ Mr. Howie
It is wrong for those who opted out of paying their contributions to expect to be able to opt in at this late stage. It is the more remarkable that the Bill should come at a time when the Opposition, after trying for many years, have managed to convert many hon. Members on this side of the House to the idea of selectivity in social security. Certainly, some of my hon. Friends believe in the total idea of a full flat rate benefit and many other of my hon. Friends—
§ Mr. Cranley Onslow (Woking)
On a point of order, Mr. Speaker. Since it is clear that the argument is becoming 1975 repetitious, and that the subject of the Bill has been debated many times, will you reconsider your decision not to accept a Motion for the Closure?
§ Mr. Speaker
I have already ruled on that and I am not prepared to reconsider my refusal to grant a Closure. If the hon. Gentleman reads a recent Friday debate, he will see that exactly the same situation arose then.
§ It being Four o'clock, the debate stood adjourned.