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Baroness Hollis of Heigham: My Lords, I am sure that the noble Earl will understand if I insist on passing on that question.

Baroness Strange: My Lords, I thank all noble Lords who have supported me tonight; that is, my noble kinsman Lord Russell, the noble Lord, Lord Morris of Manchester, my noble friend Lord Freyberg, my noble friend Lady Park of Monmouth, my noble friend Lady Dean--there is nothing written in Erskine May about Cross-Benchers having noble friends, so I think that they can all be my noble friends--and my noble friends Lord Mackay of Ardbrecknish and Lady Buscombe, who supported me. I thank them very much indeed. What they said was very moving and made me feel quite tearful and a little bit like jumping on to the Floor and falling behind the Benches. I am not going to. It is quite clear to me, and I hope that it is also quite clear to my noble friend Lady Hollis, what the opinion of this House is. I am very greatly tempted to divide the House.

However, despite listening to my noble friend Lady Hollis, I feel a bit as if I were a kitten enmeshed in a ball of wool when one pension is called against another pension. I know exactly what I am talking about and I think probably that she does too. I should like to thank her very much for what she has said and for her promise to arrange a meeting with the MoD, with the ladies and me, preferably. We may therefore be able to put pressure on the MoD and explain the situation very clearly because we do feel that this is a great injustice. Perhaps the MoD may be able to see its way to putting the matter right. It would also help it a great deal with its recruitment. Having said that, I also think that it is rather late at night and I have apologies to make to the Captain of the Gentlemen at Arms, who was very persuasive. It is a long time since I caught the 6 o'clock train this morning from Dundee. Therefore, I shall return to fight another day. I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

Lord Morris of Manchester moved Amendment No. 52:


After Clause 18, insert the following new clause--

(“PART IIA
BENEFITS AND PENSIONS: DUTY OF SECRETARY OF STATE
SECRETARY OF STATE TO HAVE REGARD TO NECESSARY MINIMUM LEVEL OF INCOME

.--(1) When determining levels of social security benefits and pensions, the Secretary of State shall take into account the minimum level of income necessary to maintain good health and cover essential needs.

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(2) In considering the minimum level of income in subsection (1) above, the Secretary of State shall take into consideration the need to--
(a) combat social exclusion,
(b) maintain satisfactory standards of child development, and
(c) ensure respect for human dignity.
(3) The Secretary of State shall commission annual independent research on the minimum level of income needed to maintain good health and cover essential needs in subsection (1) and shall publish the results of such research.
(4) The Secretary of State shall also have regard to the results of such research commissioned under subsection (3) above when setting levels of other benefits as may be prescribed.").

The noble Lord said: My Lords, I beg to move. There is a notable difference between this occasion and the debate on the issue addressed by my amendment in Committee on 20th July. I then confided to your Lordships that I had not volunteered to move the amendment: my dear and noble friend Lady Castle had, as it were, volunteered for me. It was at her suggestion that I was asked to propose the amendment and I was very glad to do so.

Sadly, my noble friend could not be here for that debate. But she is with us now, much to my delight, only days after celebrating her 89th birthday, on which I know the House as a whole most warmly congratulates her.

Noble Lords: Hear, hear!

Lord Morris of Manchester: My Lords, I speak as a supporter of the Government's determination to eliminate poverty. It was unequivocally affirmed in their Green Paper on welfare reform in 1997, which included as one of its foremost success measures,


    “a guarantee of a decent income for all".

Recalling that guarantee in a recent letter of support for this amendment, Age Concern England told me:


    “We welcome the intention of providing a decent income for all, but question how it can be taken forward without any attempt to establish what is meant by 'decent'".

The National Children's Home (NCH) sees my amendment as providing the “missing link" in current social policy making:


    “Many individuals and organisations are working hard to support and make a reality of the Government's efforts to tackle social exclusion and improve public health",

they write,


    “but to try to do so without tackling the fundamental issue addressed by your amendment is to have one hand tied behind our backs".

The Reverend Paul Nicholson, of the Zacchaeus 2000 Trust, to whom I am deeply indebted for his unfailing help in preparing for this debate, entirely agrees. In a letter to my noble friend Lady Hollis dated 17th August, he wrote:


    “I share, admire and will work for the success of the Government's ambitious approach to tackling poverty".

But like countless others who have written to me since I raised the issue in Committee in July, he is concerned that the lack of fully researched minimum income standards makes any policy to eliminate poverty rudderless.

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In a long and fortunate parliamentary life, I have had many warm responses to legislative changes that I initiated; but never before have I had so many for moving a single amendment. Age Concern England, the NCH, Barnardo's, the NSPCC, Church Action on Poverty, the Low Pay Unit, the Maternity Alliance, the Association of Directors of Social Services and the UK Public Health Association are just some of the scores of admirable organisations that see this amendment as essential to combating social exclusion and protecting human dignity. They are, all of them, organisations that work much closer to social realities than most of us here and to which the Government should listen with attention and respect.

What also unites them is a deep and genuine concern that policy-making is blind if we fail clearly to state, in legislation as important as this Bill, the criteria that should inform any meaningful definition of a minimum acceptable standard of living. They express that concern not in the expectation of eliminating poverty overnight, but simply to ensure that an inevitably gradual approach to doing so is both well-conceived and “joined-up" in the sense of having weighed the implications of policy decisions for departments all across Whitehall.

Agreement on a meaningful definition of a minimum acceptable standard of living is all the more necessary because it is so widely and wrongly assumed that, as societies become more prosperous and irrespective of whether any minimum standard is set, wealth inexorably trickles down and poverty is reduced. Ours is a strong and prosperous economy, as my right honourable friend the Chancellor of the Exchequer told the Labour Party Conference at Bournemouth on 27th September. But my right honourable friend the Prime Minister said from the same rostrum the following day that we still have, on his estimate, 3 million children living in poverty. I rejoice in the Prime Minister's commitment to end that shaming comment on our strong and prosperous economy; and I am sure he will do so all the more quickly if we can now define what we mean in using such terms as “decent" in describing the “guaranteed income for all" to which we are pledged.

The myth that poverty disappears in prosperous societies, whether or not any minimum acceptable standard of living is set, is most graphically demonstrated by what has happened to Britain's poor since the link between social security benefits and the higher of average earnings or prices was broken by the then Conservative Government in 1980. From 1980 to 1998, average earnings in Britain increased by £115 a week at 1998 prices. Over the same period, the weekly income of a couple living on income support failed even to keep up with prices. Had it done so, their income support of £79 a week in 1998 would have been £5 higher. Thus while average annual earnings were £5,980 higher in 1998 than in 1980, the standard of living of couples on income support fell below even what it was in 1980.

The finding of a most helpful study by the Library of the House of Lords of the sums accruing to the Exchequer from breaking the link between earnings and social security benefits shows that they totalled

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#119.3 billion in the years from 1980-81 to 1996-97. That far exceeds Britain's total spending on social security benefits in the current year and represents a brutal switch of resources from the poor in our society to other and more fortunate people. Increased wealth from 1980 to 1997 in Britain created not a trickle but a flood; and its direction was up, not down.

Speaking in the House on 17th June, my noble friend Lady Hollis told your Lordships:


    “Under the previous Administration the rate of growth of the social security budget was 4 per cent over the previous Parliament. Under this Administration the rate of growth is 2 per cent".--[Official Report, 17/6/99; col. 416.]

Even the 2 per cent. growth is due primarily to the number of elderly people living longer and to bringing people who were unemployed back into work. And to put it mildly, the challenge of creating the socially just society to which we are committed is unlikely to be met by progressively cutting the rate of growth of social security spending achieved by an Administration who transferred to taxpayers £119.3 billion from people on social security.

Some 750,000 people now have social fund loans from the Benefits Agency. The average weekly repayment is £7, but repayments of £12 per week are not uncommon. They require the unemployed to fund emergencies out of inadequate incomes, thus forcing them into more unpayable debt. The stress that causes is bad for families and bad for society. The suicide rate among the poor is four times that of professional workers. The divorce rate is also four times higher and life expectancy is five years lower.

In March 1999, the Treasury showed that 4 million children were living in poverty in 1995--three times the number 20 years ago--and that two out of every five children are born poor. The British Medical Association reports that poor families in the UK now include some of the unhealthiest children in the developed world. Only Albania has a higher proportion of dangerously underweight babies than Britain.

A survey by the European Anti-Poverty Network showed that the UK had 32 per cent of children living in poor households in 1993 when defining poverty as half the average income--the worst in Europe. Nations which set minimum income standards recorded half or less than half that rate: among them the Netherlands with 16 per cent, Belgium 15 per cent and France 12 per cent. Denmark was the lowest at 5 per cent.

When people apply for income support the Benefits Agency undertakes a means inquiry and then notifies applicants whether or not they are entitled to it. If they are entitled the Agency's letter tells them:


    “ ... how much money the law says you need to live on each week".

If they are not entitled the letter says:


    “You have more money coming in than the law says you need to live on".

Yet there is no list, quantification or costing by Government of need. The law “says" but the law does not “know" because need is not defined. It is a

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remarkably misleading letter in the absence of any official and empirical research into essential needs to enable the setting of minimum income standards.

We are sadly behind international practice in not setting minimum income standards. Among other countries, they are set in Australia, Finland, Germany, New Zealand, Norway, Sweden and the United States. A range of methods are used which differ in their attention to specific measures of need. In Finland, Germany, Norway and Sweden, one use of minimum income standards is to set an income floor below which courts cannot enforce debt repayments, fines and attachment of earnings. They reschedule them. But in England and Wales there is no income floor below which the poor cannot be imprisoned to keep up with local taxes or child maintenance imposed on fathers by the CSA.

Charles Dickens wrote:


    “Annual income £20, annual expenditure nineteen pounds nineteen and six, result happiness.


    Annual income £20, annual expenditure £20 and sixpence, result misery".

More visibly now than then the misery is shared by us all in highly expensive poverty-related ill health, crime, debt and educational under-achievement. While no estimates are available of poverty-related costs to public funds, they are clearly enormous and need urgently to be addressed and reduced. For therein lies the answer to those who fear that minimum living standards cost more. In fact the absence of such standards already costs far, far more than public accounts ever disclose.

It clearly is irrational that, while aiming to eliminate child poverty in 20 years, we have no official estimate of the minimum incomes required for essential needs and to promote good health among pregnant women and children. Yet the methodology to provide us with the information needed to set standards is available. It was pioneered by the Family Budget Unit at King's College, London.

This is a hugely supported and necessary amendment to the Bill. If my noble friend feels that its drafting could be improved, I shall be content to discuss this with her between now and Third Reading; and indeed, to respond positively to any suggestion she may have for accepting at least the principle of what is proposed in an amendment which its supporters see as supportive of the Government's own objectives: indeed essential to their achievement. What possible objection can there be to discussing the principle of my amendment with, among other trustees and advisers of the Family Budget Unit, Chris Pond MP, Archy Kirkwood MP, Jim Lester and Professors Jonathan Bradshaw and David Piachaud? I beg to move.

Midnight

Earl Russell: My Lords, earlier this afternoon I was thinking about the underlying issues behind this amendment. I remembered a school physics lesson. The teacher was asking us to define a yard, and immediately batted back all the definitions such as “three feet" on the grounds that they were simply tautological and

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circular. He was just about to launch into his extremely technical definition in terms of energy when an historian at the back of the room put up his hand and said, “Sir, wasn't it the length of King Henry II's arm?"

I am reminded of that story when I think of how benefit levels have come to be what they are. They have come to be what they are by a process of historical accident followed by regular uprating strictly in line with prices or earnings, as the case may be.

There is no reason, over a period of this length, why the elements in an essential budget necessary to maintain good health should remain in exactly the same proportion. Indeed, to take one obvious example, bus fares have gone up far out of line with all the rest of inflation. That is why, when the National Consumer Council considered the cost of shopping for food in rural Wales, it found that it came in 20 per cent above the figures indicated by the RPI. That is one of the reasons why rural poverty in Britain today is a serious problem.

I was talking to someone at our party conference from Somerset--not exactly one of the dark corners of the land--who had to pay £6 in bus fares for her and her child every time she went to sign on. The Acheson report drew attention to food deserts. They are areas where prices are extremely relevant to the cost of an adequate diet. So it would make sense, at this distance of time, to conduct research which reassesses the provisions necessary to the maintenance of good health and works out whether the purely historic or accidental way in which benefit levels have been set is right.

This is a modest amendment. It does not call for a return to the earnings link; it does not call for the expenditure of £119 million; it does not even call for any immediate increase in benefit. It calls on the Secretary of State to commission annual independent research on the minimum level of income needed to maintain good health. It then calls on him to have regard to that research in setting benefit levels in future. It would allow a good deal for phasing were it to be found that the benefit levels were too low.

Since the early 1990s there has been a growing chorus of research indicating that benefit levels are too low. There was the National Children's Home research of 1993; the National Consumer Council's survey, Your Food: Whose Choice?; the Medical Research Council's research on low birth rate.

Low birth rate is clearly correlated to diet. The Minister will undoubtedly say that it is also correlated to smoking, and I shall anticipate her in that. But if she argues that that is not an answer to what I am saying now, I would point out that those things can both be true independently of each other and to be concerned about one is no reason for saying that one should not be concerned about the other. Low birth rate is also correlated to reduced intelligence in the child. So the disadvantages are passed on from generation to generation.

That sharply underlines the point being made by the noble Lord, Lord Morris of Manchester, about the costs of poverty. The costs to public funds may be considerable. I was glad also that he touched on the

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point of the number of other countries which have found it necessary and practical to fix a minimum level. I never understand why all sorts of elementary social provisions are perfectly possible for large numbers of other countries whose civil services are not conspicuously better than ours, but as soon as we come within these shores the technical difficulties become overwhelming. It is high time something was done to address that problem.

Clearly in Committee we did not strike a sympathetic chord when we introduced this issue. I do not have the quotation here. My recollection is that the Minister accused us of “poverty of aspiration". If that is a misquotation I shall apologise. But I hold a letter that the Minister wrote to the Reverend Paul Nicholson in reply to his letter of 22nd July. She said:


    “the Government's approach to tackling poverty is much more ambitious than simply to raise benefit rates".

That sounds a little like Winnie the Pooh when he was asked whether he wanted honey or condensed milk on his bread. He said, “Both please"; but in order not to seem greedy he added, “But don't bother about the bread".

I fully accept that raising benefit levels alone is not a solution to the problem of poverty: that needs jobs and wages. I believe that that is common ground between us. I am arguing that it is very difficult, even if you create the jobs, to take serious steps to alleviate poverty. The Acheson Report found that if benefit levels are low enough they can be incompatible with good health because people not in good health--we shall deal with that on Wednesday when we discuss incapacity benefit--are not very good at getting jobs and not always very good at keeping jobs when they have them. Therefore, if benefit levels are actually harming our health, they are seriously harming the attempt to get more people into work.

Therefore, whatever the Minister may say about the Government's ambitions being higher, if those ambitions do not include the problem of benefit levels they will not succeed. The Minister may say--in fact, I strongly suspect that she will; although I think that she will be a little cautious in how she words it--that I am being alarmist about the problem of benefit levels at present. That is perhaps so. However, if it is, the independent research will show that it is indeed so. I should have thought that the Treasury would be rather relieved to find that out.


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