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Mr. Webb: I am grateful to the hon. Gentleman for those comments. He is right. I should acknowledge his parentage of that idea—I do not always manage to do so. As an impressionable early twenty-something, I studied

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one of his pamphlets for a little bedtime reading. It was called "The Age of Entitlement", and seemed like a good idea at the time, although the Conservatives never adopted it with any gusto, but I welcome the hon. Gentleman's reconversion. Perhaps that will give us the basis for consensus on both sides of the House. One of the things that has bedevilled pensions policy is the constant to-ing and fro-ing and the ripping up of previous promises. If we can find a basis for agreement—I know that some Labour Members are sympathetic on that point—it would be a step in the right direction.

I have been greatly heartened by the careful attention accorded to Liberal Democrat proposals as an alternative to those of the Government. The serious scrutiny that they have been given reflects our position as a Government in waiting, so I very much welcome that attention. We assure the House that we shall not oppose the regulations, but we feel that the measure on hospital downrating is a grudging concession made to deal with what was going to be a rebellion in this place. The Government had the money to go further; they should have had the grace to go further.

8.21 pm

Vernon Coaker (Gedling): I have a few comments on the uprating statement and want to draw attention to a few points. When we consider the amount of spending proposed under the orders, it is extraordinary that the Chamber is not packed. Furthermore, these are social security orders, so whatever the rights and wrongs of the proposed measures, when we consider the thousands and thousands of people in each of our constituencies who are affected by the scale, uprating and receipt of benefits, the debate is hugely important.

Something must be happening to me because this is the third debate on this subject that I have attended and I actually enjoy them. The reason is that although there are differences between the Opposition and the Government and indeed between the Opposition parties, we none the less hold careful, intelligent debates—as we have just heard—on the fundamental issues that affect us.

Although I do not agree with everything that was said by the hon. Members for Northavon (Mr. Webb) and for Havant (Mr. Willetts), there are aspects with which I agree and which challenge us all. If we were all to be honest, I suspect that Opposition Members would say that some of the Government's views challenge them to reconsider their position. I make these points because we need to remember how fundamental this subject is and that our debate is important.

I want to make a couple of points about the minimum income guarantee for pensioners. Whatever the furore about the rate of the basic state pension—which, as we have heard, is to be uprated again in April—I know that the minimum income guarantee has meant that about 2,000 pensioners in my constituency have received a considerable addition to their income.

When we talk to people about the minimum income guarantee and pensions, for obvious reasons they do not put up their hands and say "I get the minimum income guarantee and what the Government have done means a significant increase in my income". In each and every one of our constituencies, a considerable number of pensioners will have benefited from the introduction of the minimum income guarantee. The hon. Member for Northavon was right to draw attention to the problem with

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take-up. However, if we can ensure that people take it up when they meet the rules—the capital savings rules have been relaxed—a single person will receive £98.15 and a couple will receive £149.70 from next April, which is a considerable improvement on the income that they would have had before the minimum income guarantee existed.

We can debate the difference between means-testing and targeting, but the word "means-testing" has a particular connotation for the pensioner age group. In a few years, when people who are now in their 50s and 60s become pensioners, it may not have the same connotation. However, the continual discussion in the House about means-testing being bad does not help to encourage people to claim means-tested benefits. It merely reinforces people's feeling that those on means-tested benefits have something wrong with them, are not the sort of people to whom others will look up, and have failed. Although the hon. Member for Northavon mocks his own oratorical skills, I was not saying that he was speaking passionately about the evils of means-testing all over the country. However, he consistently points out that means-testing is wrong, which, I believe, impacts on the number of people who claim the minimum income guarantee.

Through the minimum income guarantee, the Government have targeted support on thousands of the poorest pensioners in our constituencies. We can debate the basic state pension and take-up, but the Government deserve a great deal of credit for not taking the easy option of putting a few pounds on the basic state pension for everyone. Instead, the minimum income guarantee has added a considerable amount by targeting help on the poorest pensioners in the community, many of whom are older pensioners who do not have an occupational pension, or are older women. Far from being critical of the Government for doing that, we should credit them with a great deal of courage for saying that their policy will be to try to ensure that money goes to the poorest pensioners in our community. Through targeting, we can ensure that those pensioners receive a considerable amount of money. Of course, the problem of take-up remains, and hon. Members will need to continue to raise that issue.

The pension credit, to which my right hon. Friend the Secretary of State referred, was designed to tackle one of the real problems of the minimum income guarantee—a small amount of savings, a small income or a modest occupational pension might take people just above the level at which they could receive the minimum income guarantee. That caused a considerable feeling of injustice and unfairness. The hon. Member for Havant mentioned the genuine concern about occupational and private pensions. In discussing reform, a judgment must be made on pensions and social security uprating. The Government have said that their policy is to target resources on the poorest pensioners through the minimum income guarantee—Opposition Members will say that that is flawed—and that the next group that they shall try to help is those pensioners who feel left out because of the minimum income guarantee rules, on whom they will target resources through the pension credit.

Mr. David Heath (Somerton and Frome): The hon. Gentleman is making a careful and sensible speech, and I agree with much of it. Given that hon. Members on both sides of the House share some of the same objectives, our argument centres on the delivery system. At what point will the hon. Gentleman accept that we are not delivering

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the benefit to the poorest pensioners? At what point will he accept that an alternative delivery system might achieve the same objective more effectively and efficiently so that we reach the pensioners whom we want to support?

Vernon Coaker: The hon. Gentleman makes a fair point. I do not think that we have reached that stage. In general, the policy has been effective for a considerable number of pensioners in our constituencies. It is clear that there is a problem with take-up, but that does not mean that the policy has failed. The problem is the way in which we talk about means-testing—to be frank, it is sometimes used for political reasons as an easy way to attack the Government—and how it is perceived. That does not help the take-up of the minimum income guarantee. The targeting of resources to ensure that the poorest members of our community are supported does not have the same stigma attached to it and commands much greater support.

Ms Buck: I share the concerns of hon. Members about take-up and we need to address that problem. However, there is evidence—anecdotal in my experience—that a substantial number of the people who could claim for income-based benefits are eligible for only small amounts. The case remains to be proven that a large number, let alone all, of the people who are missing out on the minimum income guarantee or the working families tax credit would be entitled to a substantial amount or all of the sum that would make up the difference. We have to weigh that up. Many people are on the margins of a claim that would not necessarily give them a large amount of additional income.

Vernon Coaker: My hon. Friend's intervention needs no comment from me: she proves the standard of the debate by making an important and fair point that is probably true. However, it is difficult to ascertain how many people do not take up the minimum income guarantee for that reason.

I am pleased that the Government have announced a change to the rule on the downrating of benefits when people are in hospital. Many hon. Members have been contacted by people who think that it is unfair that their benefits are reduced when they are in hospital for longer than six weeks. I am pleased that the Government have increased that to 13 weeks. A constituent who was in Nottingham City hospital recently contacted me about that. I am sure that all hon. Members have similar constituency examples.

We often talk about the minimum income guarantee in terms of pensioners and the take-up of benefit, but the attendance allowance is one of the most important benefits for pensioners. In my experience, not everyone is fully cognisant of the fact that it is possible to claim attendance allowance to cover care needs. The higher rate for that will be £56.25 from next week and it enables people to get help so that they are looked after in their own homes. I cannot stress how crucial that allowance is for pensioners.

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