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Pensions-Related Benefit

Volume 403: debated on Monday 14 April 2003

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5.

If he will make a statement on the level of pensions-related benefit take-up. [108709]

The numbers receiving the minimum income guarantee have risen steadily by 170,000 since 2000, which is encouraging. We shall continue to streamline the claiming process to encourage pensioners to take up their entitlement.

As my hon. Friend the Under-Secretary has just said, we will write to all pensioners about the pension credit. I hope that, in a spirit of generosity, the hon. Gentleman will join us in our efforts by urging his constituents to claim what is rightfully theirs.

I thank the Minister for her response. She will be aware that £1.5 billion of pensioner benefits are not currently claimed and that the increase in the take-up of the minimum income guarantee in 2000—01 was just 1 per cent. She will also be aware that the Government's target for pension credit is just 3 million out of 3.8 million pensioners. Does she agree with the Public Accounts Committee that the Government's target lacks ambition? If she does, what does she intend to do about that poverty of ambition? Why should Members believe that the measures that the Government will introduce this time to increase take-up will be any more effective than the measures that they have introduced in the past?

I gather from that succession of questions that the hon. Gentleman and his party are against the pension credit. In that sense, he must explain why he is in favour of taking an average of £400 off half of all pensioner households before the next election.

We will make sure that we encourage all pensioners to claim their entitlement. We are doing more than any Government ever have by writing to each pensioner and by making it simpler to claim. Indeed, pension credit will be able to be claimed by making a simple telephone call. It would help us all if the Opposition parties, whatever their feelings about future pensions policy in this regard, stopped putting people off claiming the credit by saying that it is means-testing when it is not.

Is my hon. Friend aware that, in the two recent take-up campaigns in South Tyneside, almost 350 pensioners were identified as not receiving the proper entitlement? That represented a loss of income to the borough of hundreds of thousands of pounds. The success of the campaigns was put down purely and simply to home visits. Will my hon. Friend congratulate the campaigns on their success, which were supported by her Department, and devote more money to home visits so that we can make sure that pensioners get what they are entitled to?

My hon. Friend is right. In fact, almost 150,000 people have received an entitlement of approximately £20 a week extra as a result of our take-up campaign. That must be good.

My hon. Friend is also right to say that home visits can make a difference. In that regard, the local service element of the Pension Service will be able to ensure that more vulnerable pensioners who otherwise might not take up the credit will have an opportunity to do so. We are putting more resources and efforts into the local service as we move forward to the better service for pensioners that the Pension Service will represent.

May I ask the Minister one specific question about these pension-related benefits? Will she assure Britain's 11 million pensioners that any changes to the main inflation index along the lines proposed by the Chancellor in his Budget last week will not affect the annual uprating of pensions and other benefits?

The hon. Gentleman will have to arrange for his Front-Bench colleagues to ask the Chancellor that question, because he knows very well that I am not in charge of making any such arrangements—the Chancellor is. He needs to ask his questions to the right Minister, as I am sure he knows.

This is a question about the uprating of pension-related benefits. It is a very important question, because the Chancellor proposes to change the index from the retail prices index to the harmonised index of consumer prices—HICP— which is apparently called "hiccup" for short. HICP tends to be lower than the RPI. If the Chancellor decides to change to that measure, he could cut the value of the uprating for millions of pensioners. Will the Minister give an assurance that the value of the uprating of pension-related benefits will not be reduced if the Chancellor changes his measure of inflation?

The Chancellor said that he was considering making such a change and, as he does so, he will no doubt examine carefully the impact that it might have on pensioners and upratings. The hon. Gentleman must make his representations to the Chancellor, but I can say that since this Government came into office, pensioner income has increased by 20 per cent. That is what I call a proper uprating.