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Pensioners (Wales)

Volume 264: debated on Tuesday 24 October 1995

The text on this page has been created from Hansard archive content, it may contain typographical errors.

I have to announce that Madam Speaker has selected the amendment in the name of the Prime Minister.

7.13 pm

I beg to move,

That this House notes with concern the rapidly falling standard of living of people of pensionable age in Wales; calls upon the Government to uprate the state pension to one-third of average earnings for each pensioner immediately and, over a reasonable period, to link them to average earnings as opposed to price inflation figures; and further calls upon the Government to introduce a statutory disregard of capital resources for those in need of long-term social and nursing care, to make the well-being of this section of society a priority, and to cease to marginalise their interests and concerns in such a deplorable way.
I am pleased to be opening this important debate. Some weeks ago, I had the privilege of addressing several hundred pensioners at an all-Wales rally at Llandrindod Wells in Powys. It has since become known as the "Pensioners' Parliament for Wales". I must say that the standard of debate and discussion in that parliament is far higher than that in this Chamber.

The overwhelming impression that remained with me was of respect for that large percentage of the population—a body of people who, for so long, have felt marginalised by Government, presumably because the Government believe that they cannot fight back. That conference showed me that they most certainly have the ability, integrity and will to fight back. In opening this debate, I respectfully remind the Government that 20 per cent. of the population of Wales, numbering some 581,000 people, are of pensionable age. They are therefore a powerful constituency, and their case obviously deserves a full and fair hearing.

I must repeat something that I said in my address to the rally, which is that there are two widely held popular myths about people of pensionable age. The first is that they are powerless to fight back, and I have already dealt with that. The second is that, when people reach pensionable age, in some strange and inexplicable way their potential contribution to society suddenly diminishes. There is a saying in Welsh, "Yr hen a yr, yr ifanc a dybia." I shall write it down for Hansard, as I usually do. Translated, it means, the elderly know, but the young think that they know.

On a personal note, by profession I am a solicitor.

I am much obliged.

I am one of those at Westminster who has moved comfortably from one profession that is not held in unqualified esteem to another. When I served my articles of clerkship, effectively training to become a lawyer, I was articled to a highly respected solicitor who, even then, was of pensionable age. I should never have qualified as a solicitor without his expert guidance. That fact will remain with me for the rest of my working life. It is something for which I owe a debt of gratitude.

There is no doubt that matters affecting pensioners have not had due priority in the past 20 years. It is a disgrace that the Government appear to be so dismissive of the genuine and heartfelt concerns of such a large proportion of modern society, and it is more so when one considers the contribution that that section of society has made to our well-being. I am reminded of the bravery and valour of those who gave everything to defeat fascism and tyranny 50 years ago. They deserve better; Plaid Cymru and I are determined that they shall have better.

It is often said that one of the marks of a truly civilised society is the way in which it treats its elderly. On that basis, the situation in the British isles leaves a great deal to be desired.

From those general remarks, I shall move to the particular. Given the time allotted, I cannot hope to refer to all policy matters affecting pensioners. I am sure that one of the main areas of concern is the level of pensions and how they have lagged dramatically in real terms in the past few years.


The average weekly income figures are £71.51 for a single pensioner and £114.21 for a couple where the main source of income is state pension, and £185.49 and £224.41 respectively where it is not. I remind the House that the average income of pensioners in Wales is 12 per cent. lower than that for the whole of the United Kingdom. I will now give way to the hon. Member for Vale of Glamorgan, if he wishes to intervene—[HON. MEMBERS: "He is asleep."] Oh, he is asleep. Okay.

Under the present regime, benefit to pensioners increases with price rises, not earnings. As a consequence, pensioners who rely solely on state benefits will not share in any economic growth. Tens of thousands of pensioners in Wales are therefore set increasingly to fall behind and the gap, I am afraid, is set to widen.

Retirement pensions are inadequate. Although pensions have risen in line with price inflation, since 1980 they have fallen drastically behind average earnings.

I am listening with some care to the hon. Gentleman's argument and trying to follow it. What does he understand to be the definition of average earnings?

Order. I do not think that the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) is giving way again.

The hon. Gentleman asked a question; I gave him the answer.

Pensioners are increasingly dependent on means-tested benefits in the form of housing benefit and income support. In 1993, 15 per cent. of retirement pensioners in Wales were in receipt of income support. While pensions in Britain have failed to keep up with earnings, there are far more generous benefits for pensioners in other EC countries.

I understood the hon. Gentleman to say that average earnings in Wales were £97. Perhaps he could check his figures.

I think that my hon. Friend the Member for Gloucester (Mr. French) was referring to the definition of average earnings, which is a key factor in the hon. Gentleman's motion.

It is not my fault if the hon. Member for Gloucester is unable to ask a question. It is not for the Minister to cover up for people who cannot ask planted questions properly.

In July, Age Concern published a report as part of its "Short change" campaign entitled "Modest But Adequate". This showed that a single pensioner would need a minimum weekly net budget of £121.08 to ensure what it describes as a modest but adequate income. Using the same formula, a pensioner couple would need a minimum of £204.49. In contrast, the most recent Government figures show that single pensioners have a net median income of £86.30 while pensioner couples have a net median income of £162.90.

The statutory requirement on the Secretary of State to review the value of pensions annually was first incorporated in the Social Security Act 1973. Under that Act, he was given scope to consider a number of factors in setting new benefit rates, including the general standard of living and other matters thought to be relevant. That was amended by section 5 of the National Insurance Act 1974 under which he is required to estimate the general level of earnings and prices in such a manner as he thinks fit and to have regard either to earnings or prices depending on which he considers more advantageous to beneficiaries.

Since 1980, earnings have tended to rise considerably faster than prices. The breaking of the all-important link between uprating and earnings in 1980 is cause for major concern. If the link had been maintained, the basic pension would be significantly higher than it is. We want an end to the tinkering; we want a basic retirement pension of not less than one third of average earnings for each pensioner so that we can uprate at a glance and not leave pensioners lagging behind.

The Government's response will inevitably be that the cost would be astronomical: restoring the link with earnings could mean that employer and employee contributions would have to rise gradually from around 18 per cent. of gross wages to around 26 per cent. We do not say that that could happen overnight, but serious thought should be given to introducing it gradually. That is a sensible approach, which I hope that the Government might be able to follow.

Does the hon. Gentleman agree that increasing the basic pension as he wishes would reduce the scope for the Government to give special help to those who need it and act as a deterrent to people taking out private pensions? Does he accept that the average pension has increased by 50 per cent. since the Conservative Government came to office in 1979?

My point is that there are those who rely utterly on the state pension. I agree that they should be targeted, but currently they are not being targeted; they are being left behind. The point is simple. I do not disagree with the thrust of what the hon. Gentleman said, but those people are not being helped.

The rise needed to bring people up to the level to which I referred would not be greater than about 5 per cent. of GDP over the next 40 years. It is interesting that that rise would be no higher than the increase in Government expenditure over the three years from 1990 during the depths of the recession, when they increased public spending ahead of the general election. It is clearly not unaffordable. What is required is the political will to make it a reality.

Even so, were it to happen tomorrow it would be considerably less than the percentage of GDP spent in Italy, Scandinavia and France, to name but three countries.

Does the hon. Gentleman agree that one of the reasons that those countries are coming to Britain to see what we are doing is because their GDP-debt ratios will be disastrous in the year 2030?

I am not sure about that. I am trying to concentrate on the plight of pensioners in Wales. [Interruption.] Ministers may well laugh. To them, it is probably a laughing matter.

The jewel in the state crown was always the national health service. It was, at one time, the envy of the civilised world and it had its roots in Wales. The imposition of the internal market mechanisms has all but destroyed it.

In respect of the Minister's question, has the hon. Gentleman read the chapter headed "The Demographic Myth" in the book "The Age of Entitlement", in which it is made clear and argued with great precision and knowledge that the Government have used the myth of the demographic time bomb to cut pensions and exaggerated what will happen in the next century? It is interesting that the author of that book is the hon. Member for Havant (Mr. Willetts), a Government Whip.

I am obliged to the hon. Gentleman. I am sure that that was a valuable contribution to the debate.

The imposition of internal market mechanisms has destroyed the national health service. Purchasers and providers may well be reasonable in business generally, but the national health service is—and always has been—a service, not a business. Other people and I believe that the system is top-heavy with administrators on large salaries, often people who have no connection with medicine and health care. Those bureaucrats have been funded at the expense of nurses, junior doctors, technicians, auxiliaries and the like. All these men and women are at the sharp end of service delivery and health care. Their loyalty is beyond doubt, but even they are now under strain.

I am often angered when constituents attending my surgeries say that they have waited three or four years for hip replacement surgery, suffering bouts of extreme pain-and suffering in dignified silence, in the disgraceful knowledge that, if they had paid privately, it would all have been over in a matter of months.

All colleagues in the House will have had experience of the fact that people who can afford to buy private health care get treated while those who cannot stay on waiting lists for long periods. Will my hon. Friend, however, also apply himself to the difficulty facing pensioners and those with no private resources at the end of their treatment in NHS hospitals? They are immediately moved out, even though they are not fit to return home, and transferred to private nursing homes or private residential homes, sometimes against their will. They have no choice in the matter.

The responsibility that used to lie with the state to provide all health care for those in need is being eroded, while the requirement to pay for private nursing homes is taking over from the responsibility that the state once had.

My hon. Friend makes a valid point, to which I shall turn in detail later. I know that one of my constituents' biggest worries is where they are going next after hospital at a time when they are in dire need.

What kind of society can accept such a state of affairs? Like all Opposition Members, I want a return to a fully funded NHS that is truly free at the point of delivery and in which waiting lists are minimal. If that takes a penny or two on income tax and a rescheduling of priorities, so be it. We must grasp the nettle now, because figures show that there are ever more elderly people in our country. I take the point that the hon. Member for Newport, West (Mr. Flynn) made earlier—that there is a great deal of Government scaremongering going on. We must tackle it now.

Consultants who tell people that they will have to wait two years for an operation unless they undertake to pay privately and have it done in a month should be weeded out of the health service. If they want to do private surgery, let them do it—but not in NHS contract time. We must sweep all that away; the internal market created it. It is drastically destroying the service. I commend my party's extensive health policy document to hon. Members. Among other ideas, it would institute fully salaried doctors and consultants who would not work outside the NHS.

I am also concerned about a serious conflict of interest surrounding fundholding practices. Anyone with the slightest grasp of what is going on can see the conflict. That the Government are setting about dismantling the welfare state is, I am afraid, glaringly obvious. Poverty, especially among the elderly, is an increasingly serious problem, more so in the rural areas of Wales.

Would the hon. Gentleman agree that most rural practices that have adopted fundholding now regard it as a poisoned chalice that has forced a great deal of extra work on them, and that most fundholding doctors believe that it offers no fair advantage to any of their patients?

The hon. and learned Gentleman is on to an accurate point. I have heard the same from GPs in my constituency. I wonder what the future of fundholding in Wales is—no doubt it will become clearer in the next 18 months or so.

In 1979, 10 per cent. of elderly people of Wales lived on an income below half the average. Today, 25 per cent. of elderly people do. Professor Julian Le Grand of the London school of economics was reported as saying, in an article in The Guardian of 24 September, that things would be much worse without the welfare state:
"Welfare services are arguably the only bulwark against increasing poverty and ill health, social misery and perhaps social instability. The question is not whether we can afford to have a properly funded welfare state; it is whether we can afford not to".
In the same article, Andrew Dilnot, director of the Institute for Fiscal Studies, said:
"The issue is not really about affordability. In the literal sense these services can all be paid for. What is at stake is a political decision about whether to pay for them communally or individually. If we do it communally, through taxation, then we redistribute from the affluent to the less affluent. If we do it individually, then people get what they pay for. The better off will do better, but at the price of more inequality. It is really that simple a choice."
Instead of scrambling around looking for tax cuts to try and save their own political skin in 18 months' time, the Government—if they have any social conscience—should be looking for tax increases—certainly in the higher rates.

Is it not also true that, during the Conservative years since 1979, the gap between the rich and the poor has accelerated here faster than in any other country except New Zealand?

Absolutely. It must be on the Government's agenda, for it has been going on year after year. Those who were less well off 10 years ago are considerably worse off today. The Government must be well aware of their plight, but they seek to do nothing about it.

I believe that the higher rates of income tax should be rescheduled so that the health service and other social priorities can be allocated the expenditure that they deserve.

Does my hon. Friend agree that the Government's fiscal and taxation policies have been directed to damaging elderly people? The shift from direct to indirect taxation has been particularly damaging to people on fixed incomes. The Government's imposition of VAT on fuel and the many other indirect taxes and VAT increases that they have brought in have hit people on fixed incomes in Wales—the unemployed and pensioners—like those in my constituency.

I agree. I hope to refer shortly to the problem of fuel and poverty. The effects of indirect taxation have been regressive for the elderly population.

Anything less than giving higher priority to the health service and ensuring an adequate service for the elderly and the rest of us is simply an abrogation of the Government's duty to the people whom they serve. The very notion of declining to treat a person because of his or her age fills me with disgust and rage. I hope that we will see no more of it, but I am afraid that there is a tendency to spend less on people the older they get—they are regarded as expendable. That is an obscene idea, but I fear that it is increasingly prevalent.

We also need to stem the tide of closures in NHS hospitals which has been created by the movement of funds from hospital care to community care. The Government must provide and ring-fence adequate funding for local primary health clinics within the community care programme, if it is to last. I also know of the worries about the funding of residential care and nursing homes—it is an important topic at the moment. I think particularly of the shortfall experienced by many residents between the payments met by income support and the fees charged by private homes. People going into private or voluntary homes since 1 April, when the community care changes were introduced, have their funding met in a different way and hence do not suffer shortfalls in exactly the same way. Sally Greengross, director general of Age Concern, recently said:
"It is wrong that a state-funded system should be forcing people to seek charitable help or make relatives feel obliged to pay for essential care; yet it is happening."
Continuing care and the responsibilities of the NHS are also of great concern. As we all know, if care is provided in the NHS sphere, it is free, and if it is arranged by the local social services department, the individual will be assessed on his or her ability to pay. Put simply, the NHS provides "health" care and social services "social" care, but very often that distinction is blurred and far from clear. I hope that people who are aware of the content of the debate know that they still have rights and that they can decline to move from an NHS bed if their case is valid. Too many people, when a consultant assesses them and says, "You're fit to go home," go home and think that the consultant must be right, because consultants are people in authority. People are cogs in the system, and the system, I believe, is wrong.

I have received a letter from a constituent of the Minister who will reply to the debate, the hon. Member for Clwyd, North-West (Mr. Richards). This gentleman represents Pensioners Voice in Clwyd. I do not know whether the Minister has received the letter. Doubtless he will not act on it anyway, but were he to act on it—possibly even read it—he would see that it contains many valid and reasonable concerns. I shall refer briefly to what Mr. Alan Roberts, BSc, says in his carefully written letter. He said that it is worrying that the change in policy on NHS provision of continuing health care has come about. He continues:
"The 1990 Welsh Office circular WHC(90)1, paragraph A5 in the Appendix gave the—

On a point of order, Madam Deputy Speaker. The hon. Gentleman is raising an issue of a letter that allegedly is from one of my constituents. He did not inform me before the debate that he was going to raise that issue.

I would not regard that as necessarily a point of order for the Chair, but it is perhaps the subject of an intervention.

I am delighted that the hon. Gentleman has invited me to intervene. Mr. Roberts is well known to me. He corresponds with me regularly. I see him regularly at my surgeries and I have discussed with him many issues relating to pensioners and other people since I became a Member of Parliament more than three and a half years ago. It would have been a courtesy if the hon. Gentleman had told me before the debate that he was going to raise an issue that one of my constituents, whom I know extremely well, had raised with him.

Did the hon. Gentleman have the courtesy to tell Mrs. Sally Greengross that he was going to mention her as well?

I am afraid that I slipped up there as well.

On an obvious point, and without delaying the House, I should like to say that Mr. Roberts represents a society, so that point is quickly dispatched, as points raised by the Minister usually are.

I shall quote three paragraphs from the letter by from Roberts, as they are rather important. He said:
"The 1990 Welsh Office circular WHC(90)1, para A5 in the Appendix gave the elderly chronic sick clear rights, including the right to refuse to be transferred to a nursing home if they did not wish to pay the fees.
Government Ministers"—
he refers to a certain written answer—
"made it abundantly clear that patients exercising this right, if they were adjudged to need continuous nursing care, would remain in the care of the NHS, whatever form that took."
He went on:
"These rights have now been cancelled in the Feb., 1995 circular WHC(95)7. In a letter to me, Mrs. B. J. Wilson, head of the Social Services Division at the Welsh Office, implied that only those patients requiring 'specialist' as opposed to 'general' nursing care in a nursing home will remain an NHS responsibility."
That is the change to which I referred.

Is the hon. Gentleman going to mention pensioners' fears about losing their home and inheritance, which were expressed in a pensioners' meeting that I had during the recess? I realise the difficulties that are involved in dealing with this issue; nevertheless, it is one of the most serious fears that is expressed to us time and again in every single pensioners' meeting.

The hon. Gentleman is quite right, and I shall conclude my speech later on that point. It is one of the most important in the whole debate. I agree with him on that.

Another live issue was raised by the hon. Member for Delyn (Mr. Hanson): fuel poverty and the problems that the elderly face. It is not known precisely how many people die from hypothermia each year, but excess winter mortality in the United Kingdom has ranged from 29,000 in 1986–87 to 55,000 in 1985–86, which is up to three times greater than that experienced in countries such as Germany and Sweden, where winters are even more severe but homes are warmer. The death rate in winter for those aged 60 to 69 is on average 12 per cent. higher than in the summer; this increases to 17 per cent. for those in their 70s and 26 per cent. for those aged 80 and over. It has been estimated that there are 8,000 excess deaths for every degree celsius that the winter is colder than average.

Older people are more likely to experience the circumstances that cause fuel poverty: low income, poor quality housing with little or no insulation, and reliance on expensive—often inefficient—heating systems. They are also likely to have greater need for heating than other groups because they spend more time at home. The general household survey in 1993 found that 31 per cent. of single, retired households mainly dependent on the state pension do not have central heating. "Cold Comfort", a national survey of 900 people over the age of 65 by the Age Concern institute of gerontology, published in February 1993, found that 26 per cent. had no loft insulation, compared to 10 per cent. of the general population. Some 18 per cent. compared to 6 per cent. did not have hot water tank insulation, and 64 per cent. compared to 60 per cent. had no double glazing.

I am an executive member of the all-party warm homes campaign, and there is a growing appreciation in the House of the fuel poverty issue. According to the World Health Organisation, the minimum bedroom temperature should be 21 deg C. A recent Age Concern survey showed last winter that 91 per cent. of pensioners fall below that level. Hypothermia is indeed a menace. I think that we need VAT to be zero-rated and not imposed in such a regressive manner. It is truly regressive because those on modest incomes spend a far higher proportion of their incomes just to keep warm than other people. I want to see a standard cold weather payment system over the whole winter, beginning on 1 October and ending on 31 March. That would be a great step forward, rather than tinkering with thermometers, as now seems to happen.

I also believe, as a matter of good sense, that we should extend the range of measures for home insulation, with mandatory council renovation grants for low-income elderly home owners whose heating systems are deficient, and an improved compensation package. The all-party group will meet tomorrow and throughout the year. We hope to enhance some of these thoughts and to push the debate further. The cold weather payment is inadequate and pathetic and in no way makes up for the deficiency.

Does the hon. Gentleman agree that, if the Government really wanted to be portrayed as caring, they could zero-rate insulation materials in the forthcoming Budget? Is it not completely ludicrous that VAT on insulation materials is 17.5 per cent. but only 8 per cent. on the fuel consumed?

I agree entirely, and I am sure that that would also create jobs. It is good common sense.

Much has been heard this year of the plight of war widows. There were significant improvements for war widows in the 1970s, but the situation should now be reconsidered urgently.

Another huge issue is law and order—the so-called battle for the streets. We all fondly recall the time when the front doors of houses in villages and towns were held open by a stone. Those days, alas, are gone, but we could realistically see them again. It is no use the Home Secretary talking about boot camps. What we really need is better financing for the police to enable them to extend community policing—by far the most effective but also the most expensive form of policing.

In that regard, I am sure that prevention is far better than cure. We need to prioritise spending on policing and on building good relations between youngsters and the police. We need to encourage young people to make their voice heard, to take pride in their localities and to play a full role in community life.

Time and again I hear, especially from the elderly, that the village bobby has gone and that they do not know to whom to turn. I do not wish to scaremonger, but even in a village such as Betws-y-coed in my constituency, the elderly are saying that it is risky to go out after dark. I remember that village when there was never any risk, despite the fact that it was on a main trunk road—the A5. There is much that can be done, and the Government should he doing it, to make the elderly in society more comfortable.

I want to see free or reduced cost travel on public transport for the elderly and I want it to be extended. Like many hon. Members, I have often been lobbied on the subject of television licences. Many of us have argued long and hard for an amendment to the Wireless Telegraphy (Television Licence Fees) (Amendment) Regulations 1995 and I am sure that the campaign will continue. There is a case for a free television licence for the elderly and the retired.

I also want to see the abolition of standing charges for gas, water and electricity for the elderly. Again, they are often disproportionately high in comparison with the actual values consumed—another point referred to by the hon. Member for Delyn (Mr. Hanson).

Some three years ago, I introduced a ten-minute Bill on water charges. It attempted to secure a water charges benefit for the elderly and two other classes of society. We need a change and that change is overdue. That matter was brought to my attention quite dramatically by a constituent of mine from Bala, an elderly lady who said that she had never been in debt in her life and that the prospect of gas and electricity bills and, in particular, spiralling water bills, was making her ill. She was visibly anxious and upset and, when I noted the details of her latest water rates demand, I saw that she was paying £5 per annum more than my household where two of us are wage earners—and we have two teenage children whom I am sure use a great deal more water than that elderly lady.

The truth is that there is no regard for the all-important factor of ability to pay, and that is iniquitous. Even the despised poll tax had some regard to that principle. The Government will undoubtedly say that that is nothing to do with them, but it was the Government who privatised the utilities—those bare necessities on which life depends. It is no use hiding behind the water companies. The Government should intervene, and I commend my Bill to the Minister for reconsideration.

The hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) referred to the elderly being deprived of their homes. That is a serious problem. It is estimated that some 40,000 family homes in the United Kingdom are sold each year just to meet the cost of care—note the use of the word "home" rather than house or property. People, in the autumn of their lives, are subjected to the ordeal of having their home—which they have worked hard to pay for—taken by the state which had guaranteed them state-funded care from the cradle to the grave. They are industrious people who have paid their dues in the form of taxes and national insurance and who were relying on the contract with the state. Now it has been decided to move the goalposts and, effectively, make them pay twice. That is disgraceful and cannot be justified.

The Government must reconsider urgently. I strongly suggest that the home be kept out of the equation altogether and that the £8,000 savings limit or capital threshold should be raised considerably. I have a figure of £20,000 in mind, but it should be at least doubled so that the elderly can live with dignity. I understand that that is a live issue in Cabinet and change is overdue. I hope that the Government will conclude that the current position is untenable and should be changed without delay.

How can the Government, who are actively considering the abolition of inheritance tax, not accede to that call for change? It is viewed by many people across the political spectrum as an absolute scandal, which I trust will shortly be addressed. If the Prime Minister's nest egg speech was anything other than empty rhetoric, we should see much-needed change shortly.

I have two outstanding points to make. First, the Government should reintroduce free eye testing and dental treatment for the elderly. They should also provide dental treatment for all in society. In my constituency, as elsewhere in Wales, there are areas with no dentists. The position is complex. Some steps have been taken, for which I give due credit, but more should be done. Greater emphasis needs to be placed on the matter. That is an acute problem in many areas in Wales.

The elderly are put off going to the dentist because they believe that that will be expensive, they do not have the money to pay and they are worried about huge bills. Opticians tell me that they come across glaucoma and similar conditions more often now and more often at an advanced stage because people feel that they cannot afford to have their eyes tested. Such conditions can lead to blindness. The problem is becoming acute. Therefore, I ask the Government to reconsider the question of free eye testing and, in particular, free dentistry for the elderly in Wales.

Many pensioners in Wales are concerned about mobility. Efforts must be made to assist local government in the provision of cheaper public transport for the elderly.

If all this sounds like a continuous moan or, as the Secretary of State for National Heritage would have it, whingeing, I make no apology. It is simply impossible to discuss the current situation of pensioners in Wales without turning to a catalogue of real and serious complaints.

I trust that hon. Members on both sides of the House will agree when I say that it is high time that pensioners' concerns received due priority. My party intends to do just that, and I am sure that other Opposition parties will do likewise.

I want society's natural respect for the elderly to be translated into action. The younger generation owes much to today's senior citizens and it is about time that we set about paying off that debt of gratitude.

7.59 pm

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:

"welcomes the rise in pensioners' living standards throughout Wales and the rest of the UK since this Government took office; applauds the fact that pensioners' average incomes have increased by 51 per cent. in real terms since 1979, compared with only 5 per cent. between 1974 and 1979; welcomes the extra help, amounting to £1.2 billion per year above the rate of inflation since 1988, awarded through improvements to income-related benefits for pensioners; believes it is far better to target benefit resources on those in the most need; applauds the fact that this Government has provided a solid basis for income in retirement by maintaining its pledge to increase basic retirement pension at least in line with prices; and welcomes wholeheartedly the wider and substantial benefits delivered to pensioners by this Government's policies, particularly the control of inflation."
I am delighted to have the opportunity to discuss the position of pensioners in Wales. I assure the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) that I am no less concerned than he is about Welsh pensioners—indeed, about all pensioners. He was right to pay tribute to those who fought so bravely in the second world war to protect us all from fascism, as I know hon. Members on both sides of the House will agree.

At the beginning of his speech, the hon. Gentleman pointed out that he is a solicitor. As a lawyer, he will be acquainted with the well-known legal expression, "Do not let the facts get in the way of a good speech." I do not intend to start by commenting on whether it was a good speech—that is for others to judge—but he certainly did not let the facts get in the way.

Let us look first at the hon. Gentleman's central argument that pensioners' living standards are falling rapidly. That is just plain wrong. Pensioners' real incomes have risen by an average of 51 per cent. since 1979. Furthermore, when the hon. Gentleman referred to the average income of individuals—the earners—he referred to what is now £301 per week gross in Wales.

I should like to make some progress first.

No one listening to the remarks of the hon. Member for Meirionnydd Nant Conwy would have known that pensioners' real incomes have outpaced those of earners in Wales since 1979: pensioners' average real incomes have increased by 5 per cent. more.

The figure that I gave was £97.01, one third of £301. That is one fact on which I did not slip up.

The hon. Gentleman may be a little confused. The figure for average earnings in Wales is £301, not £97. The hon. Gentleman seemed to have a little difficulty with the question. Pensioners' real incomes in Wales have risen by more than those of earners. That is the point that undercuts the hon. Gentleman's entire argument about Welsh living standards.

In a moment.

The fact that there has been a guarantee of index linking of retirement pensions is important; but the overwhelmingly important issue is the way in which private provision has been encouraged, and has supplemented pensioners' real incomes. That is one of the great successes of the current Government.

Will the Minister disaggregate that figure, and reveal the effect on those who depend purely on state pensions?

The lowest amount that could be received by a pensioner couple on income support, with no private or occupational pensions, is just over £100 per week, excluding the cost of renting their homes. The difference is substantial. The Government's achievement has been to encourage private provision and occupational pensions: as a result, pensioners have improved their position. Meanwhile, their savings have retained their value. [Interruption.] The hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) makes his comments, but under Labour, pensioners' savings were ravaged by high inflation. The present Government have presided over the longest period of sustained low inflation since 1961.


Had it not been for that long period of low inflation, pensioners' savings would be nowhere near as strong as they are today, and their investment income would not be coming through.

Pensioners in the private sector are more secure than they were because of the reforms in the Pensions Act 1995, and spending on health and care services has risen rapidly. The hon. Gentleman was wrong to say that living standards had fallen; he was wrong to say that average earnings had exceeded the income of pensioners; and he was wrong to say that nothing had been done about heating. I shall deal with each of those issues shortly.

Does the Minister agree that, in 1995, pensioners who are dependent on their state pensions are relatively far poorer than those who have the advantage of private pension provision, and that the difference is greater than it has ever been?

The hon. and learned Gentleman makes a trite point. It is obvious that pensioners who take out private occupational pensions—the Government have encouraged them to do so, and 5.6 million more are doing so—are in a better position than those who do not.

In Wales, as in the rest of the United Kingdom, pensioners' average incomes have risen at today's prices. In 1979, the figure was £95.60 per week; in 1993—I am quoting real figures—it was £138.60. That is the latest information that we have. Across the United Kingdom and in Wales, pensioners' average incomes have risen; and, if housing costs are taken into account, the position is even stronger. The increase is explained by index linking of the retirement pension, by the impact of income support and by the Government's policy of encouraging occupational and personal pension provision. Retirement pensions have maintained the value that they had in line with inflation, and constitute an essential building block in retirement income.

Will my hon. Friend confirm that eight out of 10 pensioners have income from other sources—occupational pensions, savings or investments?

That is true. More than half the pensioners in Wales now receive occupational pensions, amounting on average to £74 per week. A substantial proportion—two thirds—now receive income from investment, averaging £37.40 per week. That improvement is the result of the Government's policies.

We should not forget that the approach of targeting help through income support means that the pensioners who are least able to make provision for themselves have a benefit that has been uprated ahead of inflation by £1.2 billion since 1988. As I have said, the lowest rate for a pensioner couple receiving income support is now more than £100 a week, and that couple's housing costs will also be met.

Occupational and personal pension provision has dramatically increased the incomes of pensioners in the United Kingdom and Wales. There are 5.6 million individual personal pension holders in the United Kingdom. That has not happened as a result of coincidence; it has happened as a result of low inflation, which has made saving worth while. As I have said, we have experienced the longest period of sustained low inflation since 1961. The encouragement of occupational and personal pensions, and low taxes for individuals, have enabled people to choose how to spend their incomes and to take out such pensions.

I thank the Minister for giving way at last. I just wanted to know whether he had any figures on the disposable income of pensioners in Wales and on the effect of VAT on fuel on that income.

It is right that the increases in relation to VAT on fuel were made across the board, but the effect on pensioners was mitigated by a substantial package of help, which was introduced, as the hon. Gentleman should know, in April 1994 for all pensioners, most disabled people and all people on income-related benefits. Fifteen million people benefit from that aid package. In 1994–95, the Government provided £420 million of extra help. That will rise to around £700 million extra during this financial year.

The Government are not in a position to dictate the charges that are made by various industries. Where possible, however, we try to influence the industry and, if necessary, increase or introduce grants to offset the costs. Value added tax is a broad-based tax: the supply of most goods and services is subject to VAT at the standard rate. This is the only sector where a lower rate applies. Standing charges are not part payment for supplies of domestic fuel and power-which would mean that they would be covered by the reduced rate-so they are taxed at 17.5 per cent.

The Government's policy on pensions has brought the prospect of increased prosperity to millions. We have more employer occupational pension schemes and more people taking responsibility for their retirement income. We have built a solid foundation of funded pension provision that is the envy of the rest of Europe, and we have done that through providing more choice and opportunity. That will remain the Government's policy. It is not "deplorable"—the word in the motion. It does not marginalise pensioners; it places their welfare at the heart of Government thinking.

The hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) raised the issue of health and care. We recognise the importance to older people of the care services provided by the national health service and by local authorities. We have been active in our reforms to ensure that the right services reach the right people at the right time. The patients charter has set exacting standards for the NHS in hospital and community services. That is shown in Wales by the rise in the workload of hospitals. The number of cases that are being dealt with by Welsh hospitals has increased dramatically year on year.

I hope that the Minister accepts that I am assisting him in this intervention to enable him to consider various matters, but does he not accept that, although there has been a substantial increase in the throughput of people dealt with in hospitals, there has also been a substantial increase in return visits by people because they have been sent home too early?

I do not accept that argument. The figures for new out-patients are up by 5 per cent. year on year—from 601,827 to 635,984. The figures on day cases are up from 204,398 to 238,696—an increase of 17 per cent. It is easy for the hon. Gentleman to make his point in the way that he does, but the statistics show a clear rise in the number of patients being treated.

The national health service is more focused than ever on providing primary health care. When I heard the hon. Member for Meirionnydd Nant Conwy criticising the arrangements in place for general practitioners and fundholding in particular, I thought that he was ignoring patients' interests. Patients now receive the sort of health checks that we all know about, and the sort of care that doctors provide as fundholders. That system is clearly providing new benefits. It puts GPs at the forefront of caring for their patients. It is nothing other than a direct benefit not only for pensioners, but for all patients.

As in the rest of the United Kingdom, people in Wales are living longer and staying healthier for longer. Thirty years ago, Her Majesty the Queen would send out a dozen telegrams a year to centenarians; this year I believe the figure is 3,000. That improvement in health care and in longevity is the result of the Government's health care policies and of the income that is being provided.

Likewise, if one considers community care, our policies mean that more people are receiving the care that they need in their own homes, in residential care or in nursing homes in their communities. Pensioners are now involved to a much greater extent in decisions about their own care, what they need and how it is delivered, and local community charters will further those improvements.

What would the Minister say if he had constituents, as I have in Bala and Dolgellau in my constituency, who cannot receive any assistance from a dentist within 50 or 60 miles? Is that delivery of primary health care? What will the Minister do to ensure that those people have treatment under the national health service?

As the hon. Gentleman will know, the family health services authorities in every part of the country can provide details of dentists who work on the national health service and I commend him to take that course. He seems to be suggesting another expensive pledge in what I describe as one of the most expensive wish lists that any country has had placed on it.

Often, there are misunderstandings in relation to the issue of charging for residential care. Local authorities are required to charge up to the full economic cost of residential care, depending on the individual's means. The charging rules are closely aligned with income support rules—both capital and income is taken into account by the local authority when assessing an individual's ability to pay. Capital includes property and savings; income includes most social security benefits, occupational pensions, trust income and earnings.

If the individual owns a home, the social services department will generally take its value into account when it considers capital assets, but it must ignore its value if one of the following people is still living there: a husband, a wife, a partner, a relative aged 60 or more, a relative under the age of 60 if the individual supports them, and a relative who is incapacitated. Social services may also ignore the value of the property in other circumstances, such as if the person who has been caring for the individual still lives there.

The Government's view has consistently been that people who can pay for residential care should be expected to do so, taking into account their ability to pay, but it is worth bearing in mind the rules that protect the position if someone remains in the home. It is only in circumstances where the home would otherwise be empty that it is taken into account in the calculation of residential care costs.

Residential and nursing homes set charges that represent the individual's on-going accommodation, food and care needs, just as if they were living in their own homes. It was never intended that individuals should be released entirely from the cost of their accommodation and upkeep.

In principle, it is right that people should look to their own resources before they look to the taxpayer to meet the cost of care. In that way, resources are targeted where they are most needed. The hon. Member for Meirionnydd Nant Conwy will know that there is a capital disregard in these cases, including the value of the home in certain circumstances such as those that I have outlined. The Government, however, keep those rules under constant review.

He will also know that we have recently announced an important change to the way in which occupational pension income is dealt with when assessing the means of another member of the couple who goes into residential care. From next April, spouses remaining at home will have an automatic entitlement to half the occupational pension when their husband or wife enters residential care, recognising their continuing financial need. Of course, there is a discretion in the local authority up to that time to deal with it in that way.

The Government's objective will always be to target help in the most effective way on the people who need it most. There has been much speculation in recent weeks. All I can say is that the matter is being reviewed. I have no announcement to make and no hints to drop. I suspect that if I had any hints, I would not be giving them to the hon. Member for Meirionnydd Nant Conwy—[Interruption.]That was not meant in a churlish spirit. The issues should remain under review and that is what is happening.

The hon. Member for Meirionnydd Nant Conwy suggests increasing the retirement pension. His motion calls for large increases in state pensions—immediate uprating to one third of average earnings followed by a restoration of the earnings link. I should like to commend the hon. Gentleman. At least he was open about it and revealed what his policies would be. I should also commend his decisiveness. At least he has plumped for a policy. The same cannot be said for others and it would be interesting to hear in due course how the matter is being resolved on the Labour Front Bench.

All serious commentators—including the World bank, the National Association of Pension Funds and the Institute of Fiscal Studies—have recognised that to increase the value of the state pension, which is paid regardless of income and goes to virtually all people over pension age in the United Kingdom and in Wales, is not a sensible use of taxpayers' money. It would cost more than £22 billion in 1996 to uprate the basic retirement pension to one third of average earnings. That is equivalent to 12p on standard rate income tax. Even at current rates, restoring the earnings link would cost £9.6 billion, or more than 6p on income tax.

Such an increase would mean an extra £15 a week for the average national insurance payer. Even if the cost were divided between the employer and the employee, the employee would make an extra payment of more than £8 per week. It is worth bearing it in mind that figures on income and expenditure for the United Kingdom, including Wales, show that the group who are hardest pressed are those aged between 30 and 50 who have greater commitments. Increasing taxation levels on them in that way would be not only ruinous, but extremely unfair to people on modest incomes who have an expectation of tax levels at approximately the present level.

In Wales, the balance between pensioners and active members of the work force is slightly lower than in the United Kingdom as a whole, so if Wales were to become an independent country—as the hon. Gentleman believes it should—the costs would be even higher than the very high figures that I have already outlined. Such a policy would be bad for the people of Wales and bad for those on modest incomes who are paying taxes and national insurance and I do not believe that it is what pensioners want. It would also have the effect of undercutting occupational pension schemes and personal pension provision—one of the successes of the Government's policy.

The issues put forward by the hon. Gentleman—and I shall go into them in a little more detail—are the policies of opposition; it is a wish list drawn up without regard to responsibility or cost.

Has the hon. Gentleman really thought of the consequences of requiring people across the United Kingdom—and indeed in Wales—to pay an extra 12p on income tax or £15 on national insurance? Where would he find the money? He has not thought it through seriously. He is pandering to the interests of a group that has a wish list of its own, but that is not how a Government can approach the matter. The hon. Gentleman should rethink the matter and perhaps he will.

Looking at the other side of the coin, increasing employers' national insurance contributions by some £7 or £8 per week—which would divide the cost—would put an intolerable burden on business. It would damage those businesses in Wales which are having economic success and providing jobs for people who need them. Again, the hon. Gentleman should consider the matters before making wild promises which pander to a populist instinct and are not responsible policies.

By contrast, the Government have thought the issues through. We are not in the business of making promises we cannot keep. We are in the business of looking to the future and taking some of the decisions that are often hard to make. They are not the easy decisions that parties can make in opposition.

One of the Government's successes has been to defuse the demographic time bomb. Across the world, Japan, Germany, Italy and France all have debt to GDP ratios at the year 2030 that are almost disastrous. The percentage figure for Japan is 290 to 315 per cent. of GDP; for Germany, 95 to 105 per cent.; for Italy, 125 to 145 per cent.; and for France, 90 to 105 per cent. of GDP.

It is instructive to read what the OECD said about Britain in its survey earlier this year:
"In the United Kingdom with the advantages of a good starting position and a public pension scheme that runs only a small deficit, net debt as a percentage of GDP falls to very low levels and by 2030 even turns into a small net asset position."
It continues:
"The assumption of unchanged policy for spending and taxes may well not be realistic, policies might tend to be less restrictive with the evolution of debt being less favourable."
I believe that the OECD is talking about the prospect—unlikely though it may be—that an opposition party might form a Government and do some of the disastrous things that the hon. Gentleman is suggesting.

At the moment, countries across Europe are looking at the way in which we have made state pension provision affordable and encouraged private and occupational pension schemes. It would be typical of the Opposition and the hon. Gentleman's party at a time when we have got it right in terms of affordability to say, "Let us throw it all away." That is what it amounts to—throwing away the advantages we have and the position described by an independent commentator, the OECD.

Our policy is to target resources on those who cannot help themselves and allow those who can the flexibility and freedom to make their own choices.

Turning for a moment to the Labour party, I said that the same could not be said of the official Opposition—that they had nailed their colours to the mast when it came to pension policy. The Labour party continues to keep its options open—or, alternatively, it is floundering in a sea of confusion.

At its party conference in 1993, the Labour party was looking forward to the end of means-testing for pensioners. But by 1995, apparently without changing step, we see the right hon. Member for Sedgefield (Mr. Blair) embracing the Commission for Social Justice's proposal for a scheme which effectively means-tests every pensioner in the country at retirement age. Not, of course, that we can be sure what retirement age would be under Labour, as the Labour party has committed itself to a flexible decade of retirement without explaining what the age range would be and the way in which it would be centred. If it means what we think it means, it amounts to reducing the retirement age for most people to the age of 60, at huge cost to the country—£12 billion.

It is right that we should hear from the Opposition spokesman about exactly what is Opposition policy. After all, an alternative option is that proposed by the hon. Member for Birkenhead (Mr. Field), who suggests that there should be an end to all means-testing, and compulsory private pensions for all. We would like to hear tonight exactly what is Labour party policy on pensions because people outside the Chamber might not have a clear idea. We certainly do not.

The hon. Member for Meirionnydd Nant Conwy attacked NHS health care. We have studied activity levels in hospitals in Wales. Is he seriously suggesting that trust hospitals are not more efficient than their predecessors? Is he seriously suggesting that general practitioners are not doing more for their patients and giving them extra health checks than they did in the past? Is he seriously denying all the improvements that have been made since 1979?

The hon. Gentleman also suggested that nothing has been done to meet the heating costs of pensioners, but a whole range of policies have been introduced. For example, only last year the home energy efficiency scheme more than doubled its expenditure from £35 million a year to £100 million a year, which has benefited 600,000 households. When the hon. Gentleman talks to pensioners in his constituency about insulation, surely he tells them about the Government scheme which would give them help.

The hon. Gentleman may say it is rubbish, but 600,000 householders have benefited from that scheme because the Government have provided help. The cold weather payment scheme has also been improved, which has helped pensioners, as does the package of help concerning VAT on fuel.

The hon. Member also raised the issue of law and order. He ignored the fact that the Government have increased the number of police officers by 16,000. He also ignored the measures that we introduced in the Criminal Justice and Public Order Act 1994, for example, increased penalties and further measures on DNA testing, to make it more difficult for criminals to get away with it. They will help in the battle against law and order. [HON. MEMBERS: "Law and order?"] I meant the battle against crime. Those measures will also help to ensure better law and order.

It is no coincidence that in each of the past two years we have seen a 5 per cent. fall in crime levels—the first time for 40 years.

That is not true. There has been a reduction in vehicle crime. Is the hon. Gentleman seriously suggesting that people do not report the theft of their motor cars? If they do not, they do not get their insurance money. Of course they report such crime.

There have been no changes to the methods of reporting crime in the past two years, yet criminal activity has fallen for the first time in 40 years, and at a faster rate than ever recorded. It is time the hon. Gentleman gave a little credit to the Government for that.

The hon. Gentleman raised a number of other issues, but I do not want to trespass on the good will of the House by dealing with each of them. My hon. Friend the Under-Secretary of State for Wales who will be winding-up will no doubt wish to deal with some of the outstanding issues.

The hon. Member for Meirionnydd Nant Conwy put forward a whole range of propositions as though they were fact, but the truth is that not one of them has stood up to close examination. The standard of living of pensioners is not falling; it is rising. The average earnings of individuals in society are being outpaced by increases in pensions. He should accept that the Government have a deep commitment to the well-being of pensioners. That commitment is a realistic one, unlike the Opposition's wish list.

When we took office in 1979, we inherited a society in which pensioner interests were marginalised. Under Labour, pensioner incomes went up by a little more than 5 per cent., but they have gone up by 51 per cent. under the Conservative Government. It was a society in which impoverishment and dependency was a reality for the pensioner. That was deplorable. That is not the case now. With the provision of personal and occupational pensions, the retirement pension has been protected as the foundation of retirement income. Inflation has been brought under control and it no longer robs pensioners of their savings. We have targeted income on the least well-off pensioners, and offered all pensioners more choice.

I believe that the Government's case is strong when they argue that pensioners have been protected by them and given new opportunities through freedom and choice.

8.34 pm

I congratulate the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) and his colleagues on giving us the opportunity to debate pensioners in Wales.

The Minister began his speech by complaining that the hon. Gentleman had certainly not let the facts get in the way of a good speech. I must say that the Minister has failed to let a good speech get in the way of the facts about what is happening to a significant percentage of pensioners in Wales.

The Minister treated us to an exegesis on the advantages of private pension schemes. I wholeheartedly agree that those advantages exist, and I even share his aspiration that in due course every pensioner should have a guaranteed and portable pension scheme with a private element included in it, but he cannot escape from the reality—the truth that we see, or at least Opposition Members see, every weekday and every weekend in Wales: that many Welsh pensioners, especially those in rural areas, live in real poverty. They do not have private pension schemes, and perhaps they are the historical remnant of people who will rely on the state pension.

I suggest to the Minister, however, that if they are an historical remnant, they will remain so for a long time to come, and the Government must pay proper attention to that. Many pensioners fall into the poverty trap that has been created by the income support limits in particular. For many old people, who have greater needs than younger people for heat, clothing and transport provided by others, the poverty trap can sometimes be a death trap.

The hon. and learned Gentleman sees before him a motion that calls for huge increases in public expenditure. Does he support it?

I am sure that the Minister will have taken the trouble to study the Liberal Democrat policy document entitled "The Age of Opportunity". I do not propose to weary the House by reading from it now, and I will hand the Minister the copy that I have in my hand. It deals with what is now called the "third age". We do not agree with everything in the motion, but it is certainly our view that the Government are failing to address the needs of the group I have just mentioned.

It is worth recalling the words of Lloyd-George in his celebrated speech on the 1908 Budget. He said:
"How we treat our old people is the crucial test of our national quality. A nation that lacks gratitude to those who have honestly worked for her in the past whilst they had the strength to do so, does not deserve a future, for she has lost her sense of justice and her instinct of mercy."
It behoves us to treat those words, albeit in the somewhat florid language of the turn of the century, as having some resonance in the public mind. They certainly have resonance in the minds of pensioners who complain to us constantly about their lot.

I invite the Government in particular to pay greater attention to the problems faced by pensioners who live alone. The percentage of elderly people living alone, many of whom are women because of the differing mortality rates of men and women, has risen from 35 per cent. in 1971 to 45 per cent. in 1991, when I believe it was last measured. I am sure that the whole House would commend the fact that that figure is evidence of more pensioners retaining their independence in their very old age and staying in their own homes. That is to be encouraged.

Indeed, I suggest to the Government that it is very good value for public money to keep pensioners in their own homes, because it is cheaper to provide domiciliary help for pensioners than to keep them in public or private sector care homes. More important, it enables pensioners such as my elderly mother, and no doubt the elderly mothers of a number of other hon. Members, to retain what they value most: their independence—sometimes their fierce independence.

State pension dependency, which is high in Wales, especially in rural Wales, is a threat to such independence. The Minister cited the figure of one third of pensioners in Wales being dependent on the state pension, but in rural areas such as my constituency and that of the hon. Member for Meirionnydd Nant Conwy the figure is more like 40 per cent.

The Minister's eloquent and entirely justifiable paean of praise for the private sector and what it can provide to those who have bought private pensions from insurance companies will resonate among pensioners with a dull thud. Indeed, even where, for example, farmers or small business people in rural areas have participated in private pension schemes, the contribution made by the schemes has been very small and may have made the difference only between ensuring that the pensioner had some extra support from the state and had no extra support from the state. It can often be the very thing that draws them into the poverty trap.

The problem is worse in Wales, where the percentage of people of pensionable age is higher. About 20 per cent. of the Welsh population are of pensionable age—almost 2 per cent. more than in England. In some areas, such as the constituency of the right hon. Member for Conwy (Sir W. Roberts)—I notice that he is present—the statistics suggest that 28 to 30 per cent. of the population are of pensionable age, so the problem is heightened in Wales.

Another group is often forgotten by the Government: those who care—very often unpaid—for the very elderly. Research suggests that there are 340,000 unpaid carers in this country, of whom 80,000 work for more than 20 hours without receiving a penny.

The Government have, to their credit, supported a private Member's Bill that provides for the recognition of carers. That is all very well, but we should like to hear when they will come up with the money to give carers true recognition, which in principle they have accepted. They should do more than pay lip service to carers. Carers give very good value for money because they often save the Government having to spend money on keeping elderly people in care homes.

The 1991 census showed that social conditions are often lower in Wales. Pensioners are more likely to have unsatisfactory housing in Wales than in England. That creates special problems. It is a shocking fact that, in 1995, almost 3 per cent. of pensioners in Wales have no inside lavatory. That is not acceptable. Almost a quarter of pensioners have no form of controllable heating that can be set to their needs.

I say to Ministers, especially the Under-Secretary—the hon. Member for Clwyd, North-West (Mr. Richards), who will reply to the debate—that the way in which renovation schemes have operated in Wales, particularly in the past three or four years, has led to a great shortage of money to meet need where it is greatest. Are the Government satisfied with the way in which grants for home renovations have constantly run out? In my constituency, the waiting list is, I think, eight years. Will the Government do something to help pensioners who, for example, do not even have an inside lavatory?

Old age, after all, should surely be a time for freedom, enjoyment, relaxation and reflection, which those of us who are fortunate enough to meet elderly people during our work as Members of Parliament have passed to us—usually to our great profit. It saddens me that the stock in trade of many conversations with elderly people who have much wisdom to contribute to our discussions starts with complaints about having to survive—about living on the breadline. We owe our pensioners more than that.

One area in which pensioners have faced particular difficulty, despite many benign and hard-working local authorities in Wales, is community care. I spoke about that recently in a debate in the House on 2 March and I shall not repeat what I said. There is a £71 million shortfall in the funding of community care in Wales and it has been drawn to the attention of Ministers time and again. It would be nice if we were to hear a helpful reaction for a change.

The experience of, for example, Gwynedd county council—which was praised by the Audit Commission for its community care—is that to provide an acceptable standard, it must overspend. It has been faced with an overspend of more than £1.2 million. The lesson that one draws from that is that it seems that the Government quite rightly want excellent community care, but are not prepared to pay for it. It seems that they are speaking with a forked tongue on that issue.

The cost of care in care homes has already been raised. Some pensioners who leave hospital are being sold to the lowest bidder. They are either being sent to the cheapest care home that can be found, if they are well enough, or to the cheapest nursing home, if they are ill enough.

Although there are some excellent private sector care and nursing homes in Wales, there are also some awful examples. The system of inspection, scrutiny and accreditation is not good enough. People are suffering as a result, yet they are the people for whom we should have the most respect: the elderly.

There is the whole question of the way in which capital is removed from elderly people. Although the Minister gave us some slightly labyrinthine hints of a review—no doubt as part of the bread-and-circus politics which will start on 28 November and entertain us until we have a general election—the situation at the moment is unacceptable.

Is it really right that a pensioner should have to spend all their hard-earned, hard-saved capital down to £8,000? Would not it be fairer if the Government took a different view of that issue and recognised that those savings have played an important part in our national wealth and the sustaining of the economy? Should not the Government take the view that it would be better to raise the cap significantly than to abolish inheritance tax, just to grab a few middle-class votes at the general election? I can assure the Minister that the elderly people of this country, especially those honest, decent, respectable people who have modest capital, but not huge capital, would appreciate such a change of policy.

I ask the Under-Secretary of State for Wales, the hon. Member for Clwyd, North-West, to explain why there is discrimination against local authority care homes in terms of the way in which residents are charged. It goes like this. If one goes into one of Powys county council's very good care homes, one is charged significantly more for care than if one goes into the average private sector home situated in the part of Powys that I represent. I realise that this is because the charges are made on a real-cost basis. However, many of the private care homes—not all of them—provide a lower standard of service, there are fewer staff, there are fewer experienced staff, there are fewer shifts

The Parliamentary Under-Secretary of State for Trade and Industry
(Mr. Jonathan Evans)

indicated dissent.

indicated dissent.

I see two, perhaps two and a half Ministers on the Treasury Bench. What a lot of Ministers there are on the Treasury Bench at the moment shaking their heads. I issue an invitation for them to come to Montgomeryshire and to have a look. They should come and make the comparison. I see the Under-Secretary of State for Trade and Industry, the hon. Member for Brecon and Radnor (Mr. Evans), shaking his head. He may have criticisms of the county care homes in his constituency, but those criticisms would not apply in mine.

The fact is that people who go into county care homes are having to pay £30 or £40 a week more for being residents there and there can be only one reason for that. What could that reason be? The only reason can be that the Government want the county care homes to go into the private sector or into a trust arrangement that they can regard as the private sector, thus taking yet more of that important community function away from elected representatives. That view has been expressed to me by social workers and by councillors of no political persuasion—independent councillors, some of great experience. It has been expressed to me by councillors of political persuasion too and it is a widely held view. The Government should not run away from the reality of it.

The opportunity to debate policy on pensioners in Wales is welcome. I fear, however, that at the end of the debate, we shall not have made much progress in persuading the Government that pensioners deserve a better deal. I predict that pensioners will become a much more vocal force in this country than they are already. I predict that they will become a much more political force in this country than they are already. I predict that the Government will reap a sorry reward as a result.

8.52 pm

I am probably one of the best qualified to speak in this debate as I am a Welsh pensioner and I have been so since July this year. I have not been refused treatment by anybody in the national health service as yet and I am still working, as so many pensioners do in Wales and elsewhere. Perhaps that is just as well, as we are growing in numbers, as various hon. Members have said in this debate. We are aware of the danger of becoming an excessive burden on the working people of this country—the demographic time bomb to which my hon. Friend the Under-Secretary of State for Social Security, the hon. Member for Hertfordshire, North (Mr. Heald), referred.

I am glad that we have passed the Pensions Act 1995, which will equalise the state pension at age 65 for men and women, not in my time perhaps, but from 2010. That is a serious point. I am told that if the state pension ages were not changed, there would be just 2.2 working people per pensioner by 2030 compared with 3.3 now. The total number of pensioners will have risen from 10.5 million to 15.5 million. Those who have said that pensioners will become increasingly a political force are, I am sure, quite right, not just because I have just joined them.

Those figures are, of course, based on current projections; I am not sure that we have solved the problem completely. Projections can change, economic conditions can change and other factors, including the political situation, may change. All that may make it difficult for us to sustain our elderly people as we would wish. I was, however, delighted to hear my hon. Friend the Minister describe the situation that confronts this country in terms of the debt to gross domestic product ratio and to hear him say how much better the prospects are for the United Kingdom than for many other countries. I am also glad that we had last year's assurance from my right hon. Friend the Secretary of State for Social Security that the basic pension is there and rock solid, and that we have no intention of removing it now or in the foreseeable future.

Although more than eight in 10 pensioners now have income from other sources—an occupational pension, savings or investment—the state pension is still important for many people, as the hon. and learned Member for Montgomery (Mr. Carlile) stressed. The figures, of course, may be rather different in Wales. The answer is to target improvements in pensions and that too is very much part of Government policy, as is their commitment to protect the value of the pension against price rises.

During my 25 years in this House, I have known times when pensioners have really been up in arms and when the pensioners' voice was to be heard loud and clear. Those times were invariably the times of high inflation under the previous Labour Government, when pensioners saw the value of their savings being eroded. My only disappointment this evening is to have to record that Plaid

Cymru supported that Government. Successive Conservative Administrations have kept inflation low, and pensioners have undoubtedly benefited from that. I do not hear howls of complaint from pensioners or receive the flood of letters that one used to receive from pensioners in the days when inflation ran high.

As hon. Members have said, I have a high proportion of pensioners in my electorate. That does not mean, of course, that there are no concerns; some of the concerns expressed this evening are very real. There is concern in Gwynedd about community care and about the fact that the council appears to have exceeded its budget by more than £1 million. That is causing great concern to pensioners in my constituency. The £8,000 limit, too, causes concern, and one hopes that the Government will be able to do something about it in due course.

Yes, obviously we would like improvements; but not more than the country can afford. The real revelation this evening—I am glad that it has come out—is that if we were to follow the line proposed by the hon. Member for Meirionnydd Nant Conwy when he moved the motion, there would be a bill of about £22 billion, which would mean not a penny or two on income tax but as much as 12p extra.

I am conscious of the time, and of the fact that others wish to speak.

The Plaid Cymru motion calls for a direct link with earnings. I have heard that populist demagogic cry from the Labour and Liberal Benches from time to time over the years, but not recently. The Labour party, certainly, has changed its tack.

At the Labour party conference the Leader of the Opposition said that Labour was
"looking at ways for people to put together income from public and private sources to guarantee a minimum standard of living for our pensioners."
So far, so good. He continued:
"The aim of the policy is to remove the stigma of means testing for ever."
How on earth can one do that? I find the statement confusing, and I am sure that the Minister does too. How can one find out whether people have made prudent provision for retirement without some kind of means test?

Whatever the outcome, does that not mean that those who have made provision for their retirement will be penalised for their thrift? That is a sore point with pensioners even now. Those who have saved certainly do not like to see those who have not saved being treated as well as, if not better than they are, at the taxpayers's expense.

We must be careful what promises we make to pensioners. They know that policies have to be paid for, and will want to know the cost—as we have found out tonight the cost of the proposals of the hon. Member for Meirionnydd Nant Conwy—and whether it can be afforded. More than anything, pensioners want certainty.

As the Prime Minister's amendment says, pensioners' living standards have risen. Not only have their average incomes risen by 51 per cent. in real terms since 1979, but extra help has been given through improvements in income-related benefits. Pensioners now own more household goods than when Labour left office. For example, 78 per cent. of pensioner households now have central heating, compared with 46 per cent. in 1979. In 1979, 57 per cent. of pensioner households had a telephone, that all-important instrument for the elderly; in 1991, the proportion had risen to 93 per cent. That kind of thing can make all the difference in the world to pensioner families.

In my view there has been steady progress, and I am sure that it will continue while the Government remain in office. The great danger is that there may be a change of economic circumstances or—God forbid—political circumstances, which could affect pensioners' prospects very adversely. Whether we sit on the Front Benches or the Back Benches, we must see to it that that political change does not happen. If we are honest with the pensioners they will help to ensure our victory.

9.2 pm

What a pleasure it is to follow a genuine Welsh pensioner—the right hon. Member for Conwy (Sir W. Roberts)—and how we look forward to his retirement. He may go into a nursing home eventually, although I am sure that if he does we shall all visit him as it will probably be the one just down the Corridor, which is so handily placed for us.

In congratulating the right hon. Gentleman on having achieved pensioner status, I should like to correct him on one point. The decline in the number of people of working age relative to the number of pensioners is not nearly so dramatic as he suggested. Over the next 30 years it will be very modest—almost within the margins of statistical error. In Wales the figure will fall from 3 to 2.8, and in England from 3.3 to 3.2. Even the Minister, in his opening speech, confirmed that the big differential will occur only after the year 2021, when the people born in the baby boom after the second world war reach retirement age. That is the only difference between the parties on matters of fact, although there are many differences on matters of policy.

I add my congratulations to the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) on choosing the subject for the debate, which is a matter of great importance to all of us in Wales.

I am sorry, but I shall not give way, due to the shortage of time.

The founder of national insurance in this country, Lloyd George, was from Wales, as was the founder of the national health service, Nye Bevan. Matters of health and social care, pensions and provision for retirement were raised in the early years of this century by one of the great Welsh politicians, Lloyd George.

We are well aware that Wales will have two additional Members of Parliament following the next election, and the number of Members from Wales will be rising from 38 to 40. This is due not to a rise in the numbers of people of working age in Wales, but to an expansion in the pensioner population. The additional Members of Parliament are being provided in the counties of Dyfed and Clwyd, not in the industrial areas or in the capital city of Cardiff. The additional Members will be in those areas which are most attractive to people of retirement age who are moving to Wales in large numbers and surviving in Wales in greater numbers. As a result, Wales will get those two additional Members. That is pensioner power defined in a practical way for us as politicians.

I want to concentrate on a matter which is of huge importance to Wales and on which the Minister touched in his opening speech. Many pensioners in Wales are developing a fear of losing their homes in their old age because the British Government are acting as a state repossession agency and are seen as more evil than many of the worst banks and building societies which have been involved in the repossession scandal of the past few years. The moral persuasion with which the Government could lean on those banks and building societies to reduce the pressure to repossess would be much greater if they themselves were not engaged in mass repossession through the social security system.

It is not clear at this point whether the hon. Gentleman is speaking for or against the motion.

That is a singularly pointless intervention which is unworthy of any reply whatsoever and is a total waste of parliamentary time.

Is the Minister in favour of any amendment to the capital disregard rules, as has been speculated on? That is what most pensioners in Wales want to know, but the Minister did not answer that point. I understand the parliamentary convention that prevented him from doing so, but I want to tell him why that matter is such a burning issue with pensioners in Wales.

The Government have a totemic faith in the virtues of home ownership, but they did not need to tell us in Wales about that—we had that feeling about home ownership long before Lady Thatcher started talking about it. The present Prime Minister has talked about wealth cascading down through the generations, but it is people's fear and anxiety about the possible repossession of their homes when they become elderly and have to go into community care rather than wealth that is cascading down through the generations in Wales.

What do the Government intend to do to reduce the problem that they have created through the way in which they introduced the provisions relating to nursing and residential care homes, which have ballooned in number in this country over the past few years? The measures mean that £8,000 is the maximum capital that a resident of such a home is allowed to have.

I spoke this morning to Mrs. Marjorie Williams, whose mother is in an old people's home in Cardiff, having gone into full-time care in December 1992. As she had worked until she was 65 and her husband—who had been a miner in the valleys—had a miner's pension, she had some capital saved. Having run down that capital until it reached £3,000 in July this year, the Department of Social Security then told Mrs. Williams that it was time to put her mother's house on the market. That has now been done, and the house has been on the market for the past three months because Mrs. Williams' mother's savings had dropped to the £3,000 that people are allowed to keep to cover their funeral expenses.

My constituent said that if the house was sold it might fetch between £22,000 and £25,000—the typical price for a miner's terraced house. Her mother would then have to pay back the income support that she has been receiving to cover nursing home costs between July this year and whenever the house is sold. I suppose that the money thus raised will cover the next two and a half years or so: with nursing home fees at £300 to £400 per week, £25,000 does not go very far.

What really brought the problem home to me was when my constituent told me that her mother still thought that she was in a national health service and free health care system. My constituent did not dare tell her mother that she was in a private nursing home for which she had to pay or that the house was on the market because the belief that one day she would go back to her own home had kept the old lady going while she was in nursing care. That is the tragedy of it.

We live in a society in which daughters have to protect their elderly mothers in nursing homes from the knowledge, first, that they are in private nursing homes and, secondly, that their house is having to be sold to pay for the care. Elderly people who have scrimped and saved to build up their savings and pay for their house with a mortgage over 20 to 25 years, having paid for their house through the building society, then find that the Government take it off them in a mere three or four years. Rather than wealth cascading through the generations, it is being taken away from people.

My constituent said that her mother would be very upset if she knew that her house was on the market. That made me think what an odd society we lived in. The Prime Minister is on record as saying that he wants to see wealth cascading through the generations. The Government are obsessed with trumpeting the virtues of home ownership with almost religious fervour. They have to resolve the problem. I appreciate that the Minister cannot give us too many details tonight as the issue may come up in the Budget, but it sounds as though an almighty battle is going on between the Department of Social Security and the Department of Health.

One scheme that is proposed is for nursing care costs—£100 out of the typical £400 fee—to be met by the state, but for residents to meet the accommodation costs. In that case, people would still have to sell their houses, but the money might last for five years in the nursing home rather than two and a half. Alternatively, the £8,000 capital disregard may be doubled to £16,000 or trebled to £24,000. Something must be done to solve the problem. Either the Government must stop pushing out propaganda about wealth cascading through the generations or they must solve the problem that anxiety and fear instead of wealth are cascading through the generations.

The pensioners of Wales find that the Government's propaganda is contradicted by their daily experience when they require permanent, long-term care in a nursing or residential home. Chronic care is in chronic crisis. The Government are acting as repossessors. That is destroying the belief in home ownership that people in Wales always had. It makes people feel that when they buy a house they are probably not buying something permanent. They can keep the house only if they are lucky enough not to require long-term community care. That puts the frail elderly into a state of acute anxiety which makes their illness even worse.

The Minister said that many of us felt that we owed a debt of gratitude to all the elderly people who sacrificed so much during the second world war to keep Europe, the world and certainly Britain free from fascism, Nazism, and so on. That touches a raw nerve with many pensioners in Wales, who look at the level of pension enjoyed by people in Germany now and wonder who really won the war and who won the peace. They do not think that they are getting a square deal.

9.13 pm

May I first draw the attention of the House to the sparse attendance on the Opposition Benches today. To be fair, the Liberal attendance is 100 per cent., and the Plaid Cymru attendance is fairly substantial. Labour attendance is poor for such an important debate, on an issue about which the Labour party is fond of weeping crocodile tears.

I am sure that the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) spoke with sincerity, but unfortunately he spoke as a member of a party that is never likely to gain power, and his wish list could therefore be extremely long. He wanted free or reduced rate travel, free television licences, and free eye testing and dental treatment for pensioners. Surely it is better to ensure that they have a decent pension and the freedom to decide how to spend their money, like the rest of us.

The hon. Member for Newport, West (Mr. Flynn) rubbished the Government's claim that demographic changes will lead to a large increase in the number of pensioners next century. All the evidence points in that direction, and it is totally unrealistic for any Government to bury their head in the sand and fail to acknowledge that reality.

The hon. Member for Delyn (Mr. Hanson) referred to value added tax on fuel, and was supported by the hon. Member for Meirionnydd Nant Conwy, who referred to the warm home campaign. The Government have been to the fore on that issue, in making grants for insulation available to all pensioners. I did not hear Opposition Members giving the Government credit for that.

It was suggested that we should introduce zero rating for insulation materials—on the face of it, an appealing idea. The difficulty is that it would certainly be hard to define. Some items would be included, and others unfairly excluded. On the whole, I believe that we should, as far as possible, have a standard rate of VAT, when it is applied at all, and that the minimum number of items should be exempt.

The Government approach has been to increase state pensions in line with prices and to encourage private pensions. Opposition Members have not given the Government's successes due credit during the debate. It is fair to say that about 80 per cent. of pensioners will now have some form of income over and above the state pension. Surely that is a marvellous achievement. It has enabled the Government to give selective help to those pensioners who need it most. As my hon. Friend the Minister pointed out, the average pensioner is 51 per cent. better off than when the Conservatives came to power.

I shall mention a few statistics on the ownership of goods to illustrate the way in which pensioners have become better off under the Conservatives. In 1979, only 57 per cent. of pensioner households had a telephone. Now, the figure is 93 per cent. In 1979, only 46 per cent. had central heating; now, it is 78 per cent. In 1979, 88 per cent. of pensioner households had a refrigerator; now, it is 99 per cent. Those are impressive statistics.

The Conservatives believe in giving priority to those who need it most. We believe that means tests are appropriate where necessary. It was interesting to hear the Leader of the Opposition standing on his head on this issue when he said at the Labour party conference, first, that he opposed means testing, but at the same time that he would ensure that everyone had a basic minimum pension.

The importance of private pensions lies not only in the fact that they encourage people to provide for themselves, which is surely a good thing, but also in the fact that they stimulate industry, in that pension funds are able to invest heavily, and have made a major contribution to growth in the economy.

The average occupational pension is well over £70 a week, and, for those who are retiring now, it is around £95 per week. That shows the success of the introduction of such pensions.

I shall deal briefly with one of my favourite subjects—Europe. A study commissioned by the Department of Social Security, published in March 1993, considered various countries in the European Union. It is interesting that, in seven out of nine cases, the United Kingdom came ahead of Germany when purchasing power parity is taken into account. Does that not show that the Opposition are whipping up false concerns by constantly arguing that pensioners in Europe are better off than our pensioners?

I firmly oppose the motion, and support the amendment.

9.15 pm

I believe that being a pensioner in Wales should not be viewed as a negative state. People's retirements should be filled with leisure and enjoyment and truly become their golden years. Those golden years should be filled with opportunities to enjoy more leisure time, and ways in which to enjoy more interesting and independent lives.

Unfortunately, pensioners in Wales face a bleak future. Their golden years have been transformed from a comfortable retirement to a basic struggle to make ends meet. More than half a million pensioners in Wales have had their dreams of comfortable retirement squashed. They are forced to regard living with their basic needs met as an unattainable dream. Talk of private pensions rings hollow to them. Some are prevented from receiving state benefits because they have small, inadequate works pensions.

Pensioners want to have their fundamental requirements met—basic items such as health care, decent living conditions, and enough money to afford heating and a decent diet. Under the Government, those needs are not being met. Pensioners find themselves freezing in fuel poverty, unable to afford to heat their homes. Their low incomes, coupled with poor housing and inefficient heating systems, make the elderly prime candidates for hypothermia.

As has been mentioned, mortality rates among the elderly sky-rocket each and every winter, as hypothermia claims more and more elderly pensioners. Over 8,000 deaths can be attributed to every degree by which the winter temperature drops below average. That situation is not helped by increases in VAT on fuel.

Under the Tory Government, pensioners are often forced into housing that is unfit for human habitation or in a state of serious disrepair. Elderly pensioners make up over two thirds of those eligible for grants for living in unfit houses—and the grants are not forthcoming. In Wales, more than 29,000 pensioners live in unfit homes, and almost 11,000 live in houses that either lack—or have shared—basic facilities such as showers, baths and toilets. The Conservative Government have failed to deal with those dire problems, which are punishing the elderly.

Old age is not a disease, but pensioners face health problems without much support. The Tories have designed a health care system that is unresponsive to the needs of pensioners, even though one in 10 will suffer from dementia and a shocking 25 per cent. will suffer fractures as a result of osteoporosis. The Tory Government have done little to ensure that care remains adequate.

The call for health care and a decent standard of living is not a call for frivolous luxuries, but a plaintive plea for the basic necessities of life. Under the Government, the dream of pensioners' golden years still exists, but it is not a dream of a fulfilling, productive, fruitful and happy life: it is of decent housing, health care and attempting to stay warm rather than the continuing nightmare of making ends meet.

The Government will ask what can be done. Labour's last manifesto included a modest but costed promise to increase pensions by £8 for a couple and £5 for a single pensioner. Not much, perhaps, but it was a promise. A Labour Government would help the plight of pensioners in other ways, not only with money. We would introduce measures to help restore the NHS, reduce the fear of crime and improve housing.

Finally, although I congratulate the Welsh National party on choosing this important subject, the pensioners of Wales should realise that that party cannot do anything for them; it cannot deliver. Only the Labour party can replace the Tory Government and start to put right the wrongs suffered by our pensioners in Wales.

9.23 pm

The amendment in the name of the Prime Minister and others is an affront to pensioners everywhere. With the smug complacency that we have come to expect of the Tory party, it seeks to gloss over the real plight of pensioners in Wales—pensioners who, for the past dozen years, have watched the value of their pensions fall, their savings dwindle, and the cost of just staying alive increase all the time. People who have worked all their lives are struggling to live a reasonable life, confronted as they are by a Government who, when they find it difficult to make ends meet, simply say that these people should have provided better for themselves when they were working.

The Minister talked about disposable income, a matter on which the Government can speak with some authority. They put VAT on fuel and helped to dispose of a lot more income belonging to pensioners and others than they would otherwise have spent.

The Prime Minister's amendment invites the House to applaud the Government for providing
"a solid basis for income in retirement".

At best, I conclude that those who drafted that are out of touch; at worst it is a cynical display of contempt for the elderly. The amendment is insensitive to the plight of 500,000 people in Wales who are of pensionable age. I regularly see elderly people at my surgery. They are discovering that, far from old age being a time when they should be able to enjoy the fruits of their lives' labours, they face a desperate plight.

One pensioner who came to my surgery had a problem paying for his wife's funeral. The benefits system was unable and unwilling to help. He was a former service man; I pay tribute to the organisations for former service men who came to his rescue and paid the undertaker's bill—while the country he served in the war abandoned him to his plight.

A group of pensioner constituents of mine live in bungalows on a mountain at Markham, in the north of my constituency. They are desperately trying to persuade their landlord, Islwyn borough council, to change their central heating system from electricity to gas, because they cannot afford to keep warm. According to the Swalec report, the average tenant in those bungalows pays £500 a year, or £10 a week, for heating. To achieve that average, some tenants must be paying £244 and others £753. I have seen tenants' bills of £250 a quarter, or £20 a week.

Much of the housing stock in Wales is pre-war and lacking in basic amenities. Councils such as mine have done well to pay for housing improvements, but such funding in no way matches the need, and it will take a great many years to improve the housing stock.

Many houses in my area were built by the National Coal Board on the exposed sides of valleys. They catch the worst of the weather, and many of them are occupied by an aging population. That fact should be recognised, as should the needs of the elderly people who live in some of the poorest accommodation in Wales.

Life under the Tories is difficult for many pensioners, and it is very far from the description in the amendment. The problem of providing for old age will not go away or diminish. In my constituency, 15 per cent. of the population are over 65. Figures published in the Islwyn health plan last year forecast that that number will increase to half the population by the year 2026. By the year 2006, just over 10 years away, the proportion of people in my constituency over the age of 75 will be the highest in Gwent.

The Government should be preparing schemes and services to cater for this growing population of elderly people. The health plan, however, revealed a terrible lack of provision. We have no hospital in Islwyn. In 1993–94, 33,000 visits were made by my constituents, many of them pensioners, to the nearest general hospital, 15 miles away at Newport. We desperately need a neighbourhood health unit.

What about care in the community, as many of my constituents ask? To be frank, the resources available in no way match the expectations raised by the Government when they introduced it. Many old people who looked to care in the community to provide some insurance so that they could continue to live independently in their own homes have been sadly disillusioned.

Without the support of local authority services such as meals on wheels, and the various voluntary organisations, many old people would have no lifeline to the outside world whatever. I paint a grim picture, because it is grim for so many people living in Wales at the present time. Many elderly people live on the edge of poverty, in a society that appears to think that old age is a crime. The old folk of Wales, as the Government will learn, are made of sterner stuff. They will fight back. They will not be denied their chance to enjoy their autumn years in dignity and contentment.

The message to the Government is clear: "Ignore the pensioners at your peril." Let us have no more of the "Alice in Wonderland" approach that we see in the Government's amendment. If the Conservative party is not prepared to do something about the plight of the pensioners, they should move over for a Government who will.

9.30 pm

This has been a very interesting debate and I would like to thank hon. Members, from both sides of the House, who have made such a valuable contribution to it. I thank all those who have made cogent points in the debate, and hope that the Minister and his colleagues will take a number of them on board.

I have to say, however, that the Minister and, perhaps, the hon. Member for Vale of Glamorgan (Mr. Sweeney) are the only people tonight who have given the Government a clean bill of health. Even the right hon. Member for Conwy (Sir W. Roberts), in his usual way, gave some credit to the Government, but he said that there was a little bit more that they could do. He acknowledged two quite serious issues that affect pensioners in Wales: the concerns on community care, which I hope the Government will address, and the capital threshold for contributions towards residential care. We heard from the Minister that that is being considered elsewhere in the Government, and I hope that, when an announcement is eventually made, pensioners will benefit from it.

My hon. Friend the Member for Meirionnydd Nant Conwy (Mr. Llwyd) made a thoughtful and passionate speech, and he will certainly go down tonight as being on the side of the pensioners, as the pensioners' friend.

The Minister's response was extremely complacent. He seemed to give the impression that all pensioners in Wales were happy with the Government's policies. It is strange, then, that 75 per cent. of the people of Wales do not vote for the Conservatives. It seems to me that they know where their political priorities lie. I believe that the support for the Conservative party in Wales will fall dramatically at the next election, partly as a result of its policies towards pensioners.

I found it most surprising that the Minister chided my hon. Friend for pandering to the wishes of people who had a long wish list. He said that the Government were not in the business of making promises that they could not keep. What has happened during the past three years? Promise after promise, not only to the pensioners but the people of Wales, has been broken. Why are the Government now 30 percentage points behind in the opinion polls? Is it because they have kept their promises, or is it because they have broken them? The result will be quite clear at the next election. The promises made have simply not been kept.

The Minister also chided my hon. Friend for failing to understand the niceties of one or two of the points made by Conservative Members. He fell into the same trap, because a very good point was put to him by the hon. and learned Member for Montgomery (Mr. Carlile) about the differential between those on state pensions and those on private pensions. The gap between the two has risen. The Minister made the point that people on state pensions are worse off than people with private pensions and occupational pensions, but our point is that the gap between the two has also risen. The inequality has also risen. Those at the bottom of the pile are much worse off in relation to others than they have been at any time since the second world war.

The Minister said that the Government have responded to the concerns of those who have high fuel bills, particularly the elderly and the disabled, and that much help has been given to meet their needs, but he failed to point out that assistance towards heating costs was made on the basis of average bills. We must accept that the elderly and the disabled have higher than average bills and they have to pay more in order to keep warm during the winter months. The high mortality rate among people over 60 and, in particular, those over 80, is highlighted by the fact that many feel that they cannot afford the heating necessary to sustain them.

Apart from one or two points acknowledged by the Minister, particularly concerning the capital disregard, his response was extremely complacent. The Government have sought to create an image of the elderly as a group of people who have grown in wealth and independence under the Conservatives and who exercise an element of choice which they never had before. That is not the case in Wales.

There are three categories of pensioners. The top 20 per cent. is the category about which the Minister spoke. They are the people who can exercise choice, who had the wealth during their working lives to provide for their pensions. But 80 per cent. of pensioners in Wales have degrees of difficulty, some so extreme that they fall into the poverty trap.

In Wales, 40 per cent. of pensioners have capital assets in their home and some form of occupational pension. For the vast majority, that occupational pension is not particularly large, but it is too large for them to have any state benefits in addition to their pension. Therefore, they lose the benefits that others may have and they are in danger of losing their homes if they want to go into residential or nursing homes.

The right hon. Member for Conwy said that he was not receiving the same number of letters from pensioners as he was 20 years ago. I have not been in the House as long as he has, but I know that there are genuine and deep-seated concerns among the pensioners of Wales about the loss of their homes to pay for residential care. Their homes have been taken away from them and many pensioners in Wales believe that that is wrong. It is morally wrong. People should not be in danger of losing their homes if they have to look after themselves in residential and nursing homes. That is a moral issue which the Government must address. If that requires more resources, the Government must meet the challenge head on.

The other group of pensioners, the bottom 40 per cent., comprises those who live on state benefits. I fully support the point made by the hon. and learned Member for Montgomery. Pensioners in that group are found particularly in rural areas, where they have special concerns in addition to those of pensioners living in urban areas. The value of their pensions has dropped dramatically in recent years. The inequalities that are built into the system for those who have not been able, through force of circumstance, to have private pensions places them in a particularly bad position.

The Government must not say simply say that all those with private pensions are better off. Of course they are better off. But what about the bottom 40 per cent? What help will the Government give them? Shall we allow them to fall into greater inequality, or will the Government acknowledge that they have a moral responsibility to those people? Does one say that because an elderly pensioner on state benefit has not had the opportunity to obtain a private pension he should fall further behind? The value of the state pension is constantly eroded. The Government have failed to address people's concerns in tonight's debate.

We must also accept a few salient points about the position of pensioners in society in Wales. First, elderly people are over-represented among low-income groups. Secondly, dependence on state benefits in that category has increased in recent years. Income falls with increasing age; women—an issue that the Government have not addressed—and especially the large number of single elderly women, are more likely to be living on lower and dwindling incomes. The value of occupational pensions often dwindles over the years, although in the first few years it may constitute an important addition to recipients' incomes.

There are growing inequalities among the Welsh pensioner population owing to a real terms shortfall in the value of their pensions. There are growing inequalities in incomes, and—as others have pointed out—in the provision of housing. Because pensioners often live in houses that are not properly insulated, their running costs are substantially higher than those of others, and because they tend to live in large properties, often alone, their heating bills are high.

There is also inequality in the provision of care. One of the reasons why pensioners in Wales are now in difficulties is the blurring of the distinction between social and health care. The Government know full well that the more pensioners and disabled people can be transferred to the social sector, the more the NHS will be excused from paying the bill. The Minister said that more people were being treated in hospitals, and that is true; but, as every hon. Member knows, many elderly pensioners are being sent home far too early. Pensioners are having to return to hospital because the care is not available at home.

Health care that was provided in elderly people's homes by district nurses free of charge, on the NHS, must now be provided by home carers. Who is paying the bill? Pensioners, who cannot afford it. The Government are transferring responsibility from the state to pensioners who cannot afford it in the first place. Is that the priority that the Government are giving to dealing with the elderly population in Wales? Those are certainly not the principles of Lloyd George or Aneurin Bevan; they are the principles of the Conservative right, which believes that tax cuts are more important than the health of pensioners in Wales.

When community care was introduced, we were told that it created real choices for people: it meant that they could live in their own homes for much longer. The problem was that the Government underestimated, considerably, the number of people who would decide to go for that costly option. A clear choice is now unavoidable: the Government must either recognise the under-provision and provide more from their own resources or make pensioners pay more. What will happen? Pensioners will pay more. Local authority budgets cannot sustain the demand, and unless the Government are prepared to recognise that, the elderly population will pay more and more for social care.

If the Government have any credibility left in this regard, they must accept the real concerns of pensioners. They must accept that the people of Wales, including pensioners, believe that they have failed the test. At least all Opposition parties have had an opportunity to present their point of view tonight; we await the Minister's response with interest.

9.43 pm

It is my privilege to respond to a debate on such an important issue.

Conservative Members subscribe to the maxim "Age commands respect", and we respect the elderly people of this country—not least because, some 50 years ago, their generation secured freedom for us and the rest of the western world. They bequeathed to us what we have today. We respect them also for their independence. They were brought up to believe in the work ethic, to stand on their own two feet and to help their fellow man. They are a generation who are entitled to be told the truth, the whole truth and nothing but the truth.

I am afraid that all they have heard from the Opposition parties today are lies, damned lies and statistics—politicians on the Opposition Benches promising the earth without ever acknowledging that such promises would cost the earth and so cannot be fulfilled. It is a cruel deceit on a grand scale to make claims and promises that not only cannot be delivered but politicians know they will never be in a position to attempt to deliver. Opposition Members have today shown their total disrespect for the pensioners of Wales.

Do Opposition Members seriously believe that our parents' generation will be fooled by a list of empty promises? They forget that this is the generation that was tricked by the Attlee Government in 1945 into believing that socialism would deliver prosperity. It did not and it never will, so they will not be tricked today by Plaid Cymru or by new Labour: Conservative Members will see to that.

The motion that we are debating, and I notice that the hon. Member for Cardiff, West (Mr. Morgan) is already shaking his head—I am fascinated—[Interruption.] He failed to say, when speaking in a debate on a specific motion, whether he was for or against the motion. Now is he for or against it?

Given a choice between the motion and the Government's rebuttal of it, the motion is far superior to that rebuttal. What worries me about the Government's rebuttal is that the Minister's Department does not appear to have contributed to it. The Plaid Cymru motion contains not only references to pension issues, properly the province of the Department of Social Security, but matters related to long-term nursing care and social care, which are his responsibility. In the rebuttal, however, there is no mention of those aspects. I do not even know why he is winding up for the Government.

I am most grateful to the hon. Gentleman for signifying on behalf of his party that he is for the motion and, therefore, that he is for the spending implications that go with it, which amount to some tens of billions of pounds. Conservative Members will return to that issue time and again.

The motion suggests that pensioners' interests are marginalized—[Interruption.] Does the hon. Gentleman wish to intervene again?

Those interests would be marginalised as an independent Wales—which the nationalists advocate—would be marginalised under the policies of Opposition Members, but not under this Government. We instead have shown our commitment to pensioners through real measures of real benefit, but it is not only about pensioners' income, as my hon. Friend the Under-Secretary for Social Security made clear.

We want older people to continue to live full lives and to play as full a part as possible in society and we have created a climate in which they can do so, with a high-quality national health service and with the emphasis we have placed on community care and meeting housing needs. Over the years, my predecessors and I have met representatives of pensioners in Wales many times. We respect their perspective and views. We have sought actively to find out about their concerns and worries and our policies reflect that.

I was intrigued that the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) was interested in pensioners. I carried out some research into the extent of that interest and I discovered that, in the past 12 months, the hon. Gentleman's interest in pensioners extended to one entire parliamentary question.

The hon. Member for Meirionnydd Nant Conwy referred to my constituent, Mr. Alan Roberts, without having told me that he would do so, so I should like to take up one or two of the points that he raised. As the hon. Gentleman already knows, I correspond and speak with Mr. Roberts frequently and regularly.

The national health service and local authorities have played different but complementary roles since the inception of the welfare state. To address the specific point that the hon. Gentleman raised, the guidance that we issued in February reiterates the responsibilities of the NHS to provide continuing health care for those who need it, whether in hospital, in nursing homes, in residential care homes or in their own homes. The guidance does not signify a change in policy; it offers a practical national framework which clarifies the long-standing responsibilities of the NHS. I must say to the hon. Gentleman, who is not paying attention, that the guidance has been welcomed by a range of key interests in the health service, in local authorities and in the voluntary sector.

The hon. Gentleman raised the issue of concessionary fares. I am trying to address issues that he has raised and he does not seem to be paying attention; I wish that he would. All local authorities in Wales have schemes for pensioners, ranging from fare reductions of one third or half to free travel. Some authorities also have schemes for cheap travel on the railway as an alternative to concessionary bus fares. Local authorities are in the best position to decide what schemes are appropriate for their area.

In addition to all the other super high spending proposals that the hon. Gentleman made in his speech, he referred to free television licences for pensioners. That particular scheme would cost £700 million a year across the United Kingdom. That is in addition to the £22 billion linking state pensions with average earnings to which my hon. Friend the Under-Secretary of State for Social Security, the hon. Member for Hertfordshire, North (Mr. Heald), referred earlier. If we aggregate that as we go along, the sum approaches £23 billion. The Labour party is in favour of that and the hon. Member for Cardiff, West says that he now supports the motion.

There is one issue which the hon. Gentleman raised that I wish he had not raised, but I cannot allow it to pass. He spoke about pensioners having given everything to defeat fascism. I need hardly remind him that, when Britain was preparing for war, the founding fathers of his party attacked and burnt a RAF station on the Lleyn peninsula, so the hon. Gentleman need not pretend that the history of his party, which he and his supporters revere, is as clean, clear or supportive of British policies in the second world war as he would wish it to be.

No. The hon. and learned Gentleman has had all the time I intend to give him and he has had his say.

I now wish to refer the hon. Member for Meirionnydd Nant Conwy to his party's so-called white paper on health, which was published in December. I understand that there was a public meeting on 10 January that health service professionals were invited to attend. I would love to know from the hon. Gentleman how many health service professionals, if any, attended.

The white paper referred to an awful lot of high-spending proposals, which, naturally, the hon. Gentleman, or the person who wrote it, did not cost. Fortunately, I was in a position to assess those costs, so I should like to run through one or two of the proposals that the hon. Gentleman has published.

The hon. Gentleman's white paper argued that there should be "wholly free" nursing home care. My estimate is that that would cost about £140 million a year. That white paper proposed that GP fundholding should be abolished and that all GPs and dentists should be salaried—the hon. Gentleman repeated that pledge in his speech. Apart from driving GPs and dentists out of the NHS, and probably out of the country, the cost of acquiring those practices would be about £100 million. That white paper also advocated the abolition of prescription charges, even though about 90 per cent. of people in many parts of Wales are exempt from them. That proposal would cost another £17 million, so that is another quarter of a billion pounds to add to the aggregate.

That white paper also contained some other multi-million pound proposals which were totally uncosted, and which were even beyond my capability to cost. It proposed that there should be a new tier of health authorities to come beneath an elected Welsh Parliament, a health Ministry, principal health and social care authorities, health and social care authorities and, finally, hospital boards. Those five tiers of bureaucracy would lean down on our NHS and cost the earth—I cannot possibly assess how much.

The hon. Gentleman's white paper also suggested that junior doctors should work eight hours a day, 48 hours a week, which is an expensive item. It also called for the provision of extended community hospitals. I should love to cost that one, but, unfortunately, that white paper does not say how many extended community hospitals there should be.

The hon. Gentleman's white paper also suggested that community health specialists should receive new priority and increased funding—again, that was uncosted. The increase in the provision of services as a result of overlaps between health and social policy and health and housing policy also has serious cost implications to which the nationalists did not refer at all.

The joke of it all is that the proposals would be funded from 9 per cent. of the gross domestic product of Wales. The hon. Gentleman and his party have suggested that all those extra funding demands would be met by that 9 per cent. of GDP—they cannot even do their arithmetic. We already spend 9 per cent. of Welsh GDP on the health services and an extra 1 per cent. on social services. None of the wacky schemes in the white paper could possibly be funded out of that 9 per cent. of GDP. The required percentage of GDP would be even higher than that, so to the £23 billion I guess we could probably add between another £500 million and £700 million. It does not matter any longer because it is all the same as cricket scores, is it not?

Opposition Members continually call for an independent Wales. Today, for a change, they called for a better deal for Welsh pensioners. But today has given us an insight into what life in Wales, with its own Parliament, would be like if Plaid Cymru had its way. It would be a case of spending as though there were no tomorrow—the taxes to pay for that would guarantee no tomorrow. There would be bureaucrats from Benllech to Bridgend. There would be interference in people's lives: restriction of choice and curtailment of individual freedoms.

We would have an economy so burdened with taxation, regulation and government that business men would be queuing up to cross the Severn bridge—and, going that way, it would be free. Wales would witness a brain drain on an unprecedented scale. All this mayhem through the medium of Welsh—llongyfarchiadau. But for the pensioners of Wales, there would be no escape. For them, Plaid Cymru's solution would be final.

What of new Labour? That one-man band, without the—

Question, That the Question be now put, put and agreed to.

Question put accordingly, That the original words stand part of the Question:—

The House divided: Ayes 25,Noes 129.

Division No. 223]

[9.59 pm


Ashdown, Rt Hon PaddyKirkwood, Archy
Ashton.JoeLlwyd, Elfyn
Beith, Rt Hon A JLynne, Ms Liz
Campbell, Menzies (Fife NE)McCrea, The Reverend William
Carlile, Alexander (Montgomery)Maddock, Diana
Cunningham, RoseannaMichie, Mrs Ray (Argyll & Bute)
Rendel, David
Dafie, CynogSimpson, Alan
Davies, Chris (L'Boro & S'worth)Skinner, Dennis
Foster, Don (Bath)Taylor, Rt Hon John D (Strgfd)
Harvey, NickTyler, Paul
Johnston, Sir Russell
Jones, Ieuan Wyn (Ynys Môn)

Tellers for the Ayes:

Jones, Nigel (Cheltenham)

Mr. Dafydd Wigley and Mrs. Margaret Ewing.

Kennedy, Charles (Ross,C&S)


Ainsworth, Peter (East Surrey)Fabricant, Michael
Alexander, RichardFishburn, Dudley
Amess, DavidForman, Nigel
Ancram, MichaelFox, Dr Liam (Woodspring)
Arnold, Jacques (Gravesham)Fox, Sir Marcus (Shipley)
Arnold, Sir Thomas (Hazel Grv)Fry, Sir Peter
Atkins, Rt Hon RobertGallie, Phil
Atkinson, Peter (Hexham)Gardiner, Sir George
Baker, Nicholas (North Dorset)Gillan, Cheryl
Baldry, TonyGoodlad, Rt Hon Alastair
Bates, MichaelGreenway, Harry (Ealing N)
Bellingham, HenryGriffiths, Peter (Portsmouth, N)
Bonsor, Sir NicholasHague, Rt Hon William
Booth, HartleyHanley, Rt Hon Jeremy
Boswell, TimHawksley, Warren
Bottomley, Peter (Eltham)Heald, Oliver
Bowis, JohnHendry, Charles
Brandreth, GylesHicks, Robert
Brazier, JulianHughes, Robert G (Harrow W)
Bright, Sir GrahamHunt, Rt Hon David (Wirral W)
Browning, Mrs AngelaHunt, Sir John (Ravensbourne)
Burns, SimonHunter, Andrew
Burt, AlistairHurd, Rt Hon Douglas
Butler, PeterJenkin, Bernard
Carrington, MatthewJohnson Smith, Sir Geoffrey
Carttiss, MichaelJones, Gwilym (Cardiff N)
Chapman, Sir SydneyKellett-Bowman, Dame Elaine
Clarke, Rt Hon Kenneth (Ru'clif)King, Rt Hon Tom
Clifton-Brown, GeoffreyKirkhope, Timothy
Conway, DerekKnapman, Roger
Coombs, Simon (Swindon)Knight, Rt Hon Greg (Derby N)
Cran, JamesKynoch, George (Kincardine)
Day, StephenLait, Mrs Jacqui
Devlin, TimLegg, Barry
Dover, DenLidington, David
Duncan, AlanLilley, Rt Hon Peter
Elletson, HaroldLloyd, Rt Hon Sir Peter (Fareham)
Emery, Rt Hon Sir PeterMacKay, Andrew
Evans, Jonathan (Brecon)McLoughlin, Patrick
Evans, Roger (Monmouth)Maitland, Lady Olga

Malone, GeraldStanley, Rt Hon Sir John
Mans, KeithStern, Michael
Martin, David (Portsmouth S)Streeter, Gary
Mawhinney, Rt Hon Dr BrianSweeney, Walter
Merchant, PiersTaylor, John M (Solihull)
Mitchell, Andrew (Gedling)Thomason, Roy
Neubert, Sir MichaelThompson, Sir Donald (C'er V)
Nicholls, PatrickThornton, Sir Malcolm
Nicholson, David (Taunton)Thurnham, Peter
Oppenheim, PhillipTownend, John (Bridlington)
Pickles, EricTownsend, Cyril D (Bexl'yh'th)
Porter, David (Waveney)Twinn, Dr Ian
Walker, Bill (N Tayside)
Powell, William (Corby)Waller, Gary
Redwood, Rt Hon JohnWardle, Charles (Bexhill)
Richards, RodWaterson, Nigel
Riddick, GrahamWells, Bowen
Roberts, Rt Hon Sir WynWhitney, Ray
Robertson, Raymond (Ab'd'n S)Whittingdale, John
Robinson, Mark (Somerton)Wilkinson, John
Shepherd, Colin (Hereford)Willetts, David
Sims, RogerWinterton, Mrs Ann (Congleton)
Skeet Sir TrevorWinterton, Nicholas (Macc'f'ld)
Speed, Sir Keith
Spink, Dr Robert

Tellers for the Noes:

Sproat, Iain

Mr. Timothy Wood and Mr. Richard Ottaway.

Squire, Robin (Hornchurch)

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments), and agreed to.

MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.


That this House welcomes the rise in pensioners' living standards throughout Wales and the rest of the UK since this Government took office; applauds the fact that pensioners' average incomes have increased by 51 per cent. in real terms since 1979, compared with only 5 per cent. between 1974 and 1979; welcomes the extra help, amounting to —1.2 billion per year above the rate of inflation since 1988, awarded through improvements to income-related benefits for pensioners; believes it is far better to target benefit resources on those in the most need; applauds the fact that this Government has provided a solid basis for income in retirement by maintaining its pledge to increase basic retirement pension at least in line with prices; and welcomes wholeheartedly the wider and substantial benefits delivered to pensioners by this Government's policies, particularly the control of inflation.