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6.55 pm
Mr. Oliver Letwin (West Dorset): The debate has been extremely interesting, and many hon. Members have made interesting contributions. If I may single out one, the contribution of the hon. Member for Birmingham, Edgbaston (Ms Stuart) made me think in a way that I had not thought previously about the vital question of the age at which a single mother should be considered best suited to an opportunity for work, and the age at which a single mother is better thought of as being at home. That is a critical matter that needs to be addressed.
The debate as a whole has demonstrated what the Chairman of the Select Committee, the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) said a moment ago: there is an opportunity for a remarkable cross-party consensus. Many of the contributions from both sides have shown that.
I must make an admission that may lead to my achieving a severe black mark with my Whips. Most of what I understand and believe about the social security system comes from a long acquaintance with the works of the Minister for Welfare Reform, who is by any account the most profound analyst of what went wrong with our social security system, and who has produced in his work--gradually evolving, not a constant pattern across time--the most coherent explanation of the direction in which we as a country might move to remove the twin evils that he identifies: the evil of a system that inclines people towards vice rather than virtue, and the evil of a system that inclines people towards dependency rather than self-help.
That is now the common currency of political debate, across the political spectrum. That in itself constitutes a remarkable achievement, but, beyond that, the right hon. Gentleman has proposed in his various works an amalgam of measures which, taken together, constitute a radical revision of the basis of social security provision in this country.
We are all familiar with the elements, and I do not intend to bore the House by reciting each one, but they include the elimination of means tests, the elimination of SERPS, the creation of a properly funded pension scheme for all, the creation of some form of savings account that carries one through a lifetime, and the redirection of social security towards incentives to build rather than to destroy families.
Those are elements which, as my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) has illustrated admirably in a set of speeches, could command support from all parts of the House. There is therefore a golden, and in the post-war period perhaps a unique, opportunity for the reform of the system--a reform on which the economy and probably the social cohesion of this country over the next 50 or 100 years heavily depends. That is no light matter.
It is a matter of profound regret to me--I hope that this does not sound too pious--that there are so few of us in the Chamber debating an issue of the deepest social and economic significance.
We have a golden opportunity before us, and I fear that this opportunity is binary. It is remarkable in that respect. In most areas of government it is possible to reform in a patchwork manner, with one element or another being changed gradually, but that is not so with social security. In many other areas, a favourable circle exists, which means that a reform can be introduced that is beneficial for a secondary reason, while saving money in the short term. As I have said, that is not so with social security.
To achieve the reforms that the Minister of State so admirably set out that could command cross-party support, two things must be accepted by the Government. First, there is the need for the whole to be considered on a global basis, so that there might be radical action. Secondly, there must be the acceptance that, in the short term, some elements will involve extra expenditure, and certainly will not save money. These are critical elements that my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley) began to admit in his tenure of office. Alas, we see the signs of these critical elements being rejected, by, one suspects, the Treasury.
As soon as these two elements--the drive to radicalism and the acceptance of some short-term costs--are lost sight of, we are no longer in the territory of radical reform that will command cross-party support--the revision of a system that currently distorts the economy within society. On the contrary, we fall back, surprisingly, on no change whatsoever. We may tamper with a particular element that, in the absence of radicalism as directed to the whole, and in the absence of a willingness to spend some money in the early stages, will achieve nothing.
I wish briefly to allude to one element of that--earned income tax credit. I suspect that many Members on both sides of the House would have a great deal to say in favour of a radical system of earned income tax credit. Many of us believe that that is at the root of trying to resolve elements of the poverty and unemployment traps.
However, if the system of earned income tax credit, by a process of attrition and by the removal of elements of radicalism, is watered down into a working family tax credit, with opt-outs and arrangements for ticks in the box and a re-amalgamation with social security to solve the wallet-purse problem, so that the system becomes unrecognisably different from--that is, entirely similar to--the family credit system, we are left with no change.
It may be argued that that is not the worst thing that a Government can do--create no change. If the system were a working system and the Labour Government were merely trying to put their stamp on a working system, there would be nothing to which we could object.
However, the Minister of State has correctly analysed that the social security system does not work now in social or economic terms. To make changes that are not changes because they change nothing about the way in which people behave, because the Treasury has intervened and removed radicalism and the willingness to spend money up front, so as to end up with the same creaking system but with some further patchwork
and, I fear, some further complexity--not integration and radicalism but disintegration and lack of radicalism--is a terrible and tragic waste.
Alas, here we are in a Chamber that is almost desolate, with a Minister of great importance but not the Secretary of State. For reasons we understand, the Minister of State is not present at the moment. We sit in the absence of Treasury Ministers, the Minister without Portfolio and many others. That being so, I hope that, by making these remarks, I shall not suddenly transform the Government's attitude.
However, I hope that the Minister, who we know from experience in Committee is especially clear- minded, will take back the message that has been adequately conveyed in many other speeches, and especially admirably by my hon. Friend the Member for Chingford and Woodford Green. Let the Minister take back the message that there are Members on both sides of the House who have the good will, if necessary, to enable the Department of Social Security to carry forward a genuinely radical programme.
Mr. Steve Webb (Northavon):
I must admit that, as a new Member, I was rather taken aback when the Minister of State said at the beginning of the debate that the custom of the House on days such as this was not to talk about the orders before it. That rather threw me, as I had prepared a speech about the orders. With the indulgence of the House, I shall make a brief, fleeting reference to them.
I have in my hand a small, gummed, perforated piece of paper. It is a humble first-class stamp. Yet this stamp is more valuable than one of the social security benefits that we are talking about. My hon. Friend the Member for Winchester (Mr. Oaten) rather gave the game away, but I forgive him.
On page 14 of the order we find listed under the heading "Non-contributory Periodical Benefits" a description that reads:
The rate of benefit of 25p will be the same in 1998 as it was in 1997. Indeed, it will be the same as it was in October 1972, when it was last increased. It will be recalled that those were the days when five shillings really were five shillings. The benefit is paid to about 2.4 million pensioners, at an annual cost to the Exchequer of about £30 million gross.
"Age addition (to a pension of any category".
The rate of benefit is 25p. I was about to say that it was the smallest social security benefit in the system. It dawned on me, however, that in terms of weekly amount there is a smaller one.
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