I beg to move,

I am also happy to speak in the presence of my right hon. Friend the Member for Fulham, West (Dr. Summerskill) who ably succeeded him at the Ministry, and I am pleased that we have with us the two Joint Parliamentary Secretaries to the Ministry largely concerned with what we are discussing here today. The hon. Member for Thirsk and Malton (Mr. Turton) has made a point of visiting insurance departments up and down the country, which shows his keenness, and the hon. and gallant Member for Norwood (Brigadier Smyth) and I have had so many contacts over the welfare of Service men that, although we are political enemies, I like to think that we are personal friends.

One of the remarkable features of the past two years has been the behaviour of Tory Ministers in charge of Socialist social services. They seem to get infected by the virtues of the welfare Ministries which they administer. Even the Minister of Education, after cutting down the schools building programme when she took office, has been converted to the necessity of stepping it up again, though rather late and not to a sufficient degree.

I have watched with joy, also, the mellowing of the Minister of Health in office, and I think that by the time he has heard the protests of all the hospital boards this Spring he, too, will join with those social Ministers who wage continual war against the Treasury—the Treasury which is benevolent to all forms of military expenditure but which closes whatever vestige of a heart it has got when it comes to increased expenditure on the social side of the country's welfare.

As for the Ministers of Pensions and National Insurance, whose Departments have now been merged, they have been enthusiasts for their jobs ever since they took over from us. I am not a cynic, I think they really like their work. I know there are dark forces in the Tory Party and among greedy financiers in the country who regard expenditure on the social services as a luxury to be endured only because otherwise the Tory Party would lose all its working-class support; but one can say of this group of Ministers that they became permeated, as the Fabians dreamed fondly once of permeating the old Tory Party, with the warm human excellence of the work of their Departments.

I hope that, as a result of this debate, hon. Members on both sides of the House will give encouragement and strength to the Minister of Pensions and National Insurance to fight the Treasury on behalf of the people entrusted to his care. And if my words can reach the Chancellor of the Exchequer, may I say that if he wants to emulate Disraeli by stealing the Whigs' clothes while they are bathing—that is, do a Socialist job of work whilst the Socialists are in Opposition—we on this side of the House will not object to it so far as the pensioners of this country are concerned.

I do not want to call attention to defects of administration or to anomalies in the working of social insurance. The Labour Government built well when it created the great social Departments of Health, Insurance and National Assistance on what had been there before 1946. There is nothing wrong with the general structure; indeed, it is fair to say that those of us who were afraid that the merging of the Ministry of Pensions with the Ministry of National Insurance would lead to some deterioration in their work, must confess today that our fears so far have been unjustified.

The experience of every hon. Member in the House in case work is the same. There are two great groups of State servants in assistance and in National Insurance doing their job, not as the old Bumbles of the past, but as welfare officers in every sense of the word. Therefore, this morning, I do not criticise the administration. The problem is much deeper. It is the question of the basic rate of insurance benefits. When we say that we have abolished poverty and want, the words "poverty" and "want" are relative terms. Those of us who spent our childhood and young manhood among real poverty know how far we have advanced. But if utter misery has gone, real hardship remains.

I should like to say a few words, first, about National Insurance. It is true that from the start we did not set out to make the benefits of National Insurance enough to provide anything bigger than subsistence. Indeed, it was hardly subsistence, because when we began in 1946 we found that at once we had to make parallel arrangements to retain and develop Public Assistance in 1948 renamed National Assistance—for people who were not entitled to the full benefits of National Insurance or who were unable to live even on those benefits.

One would imagine, therefore, that for quite a long time yet there will still be this twin pattern, insurance benefits on the one hand supplemented on the other in the worst cases and the non-insurance cases by National Assistance. We do not want to ladle out statutory benefits without limit to those who have large incomes and it is right that the State's first grant in aid should go to those who need it most. I should like to emphasise at this point, as has been done a thousand times, that there ought to be no stigma about a citizen going to the National Assistance Board. Yet there are still proud people, and my own mother would have been one of them, who are entitled to National Assistance, but who are too proud or too shy to go for it. Indeed, the Minister will confirm that thousands of these very worthy citizens have had to be searched out by the assistance officers.

National Assistance is part of our national life and its protection is for every decent citizen, just as every citizen is entitled to police protection. But having said that, it is also profoundly true to say that when more and more people find themselves going to the National Assistance Board we ought to be anxious about it. That is what is happening today.

The basic insurance pensions under National Insurance are declining in value and increasing the number of people whose standard of life is so low, that they qualify for further help from the National Assistance Board. National Assistance is meant to catch the people who slip through the net of National Insurance, but of 4 million old age pensioners 1,250,000 today slip through the net and, without National Assistance, would be suffering terribly.

The basis of Beveridge, the basis of the Labour Government's National Insurance Act, was that the benefit given as of right should be enough for subsistence. There are many arguments against means tests, on this side of the House warm and bitter human arguments. But not the least argument against the means test is the disincentive to thrift and independence if we make the insurance basic allowance less than subsistence and give a man subsistence only if he has no other means. Why should a man save his little nest egg if it is to be used against him when he goes before the National Assistance Board?

If we accept as a normal state of affairs that one in four have to prove need before they receive a pension equal to that provided in 1946, we move clean away from the basic principles laid down in the Beveridge Report and in the National Insurance Act. Similarly, it is right that side by side with basic war pensions there should be all the excellent pattern of supplementary aids, unemployability allowance and the like. This might be called the National Assistance side of war pensions.

In 1946, we tried to assess, as of right, certain payments for war disabilities. These basic pensions ought to move to meet any rise in the cost of living and without any means test. That is why I said that this debate is on fundamentals. That is why my Motion asks for the raising of the basic rates of pensions, old-age pensions, widows' pensions, ex-Service pensions, sickness and unemployment allowances.

I shall not go into the price index argument, or even the rate of the rise in the cost of living argument. I want to stick to facts that even the Government must accept. One is that the cost of living has risen since the basic pensions were fixed and has risen beyond any pension increases. I am willing to grant that the speed of the rise in the cost of living was less in 1952 than in 1950. We can argue some other day, in a party battle, why that was so; but it is true that since this Government took office the cost of living has risen. It is true that after raising it the Government have slowed down the speed at which it is rising. But it is up, and at a time when the fall in world prices justified us in assuming that it would go down.

Unless there are major policy changes the cost of living will rise further. It is a matter of fact, not of party politics, that reducing food subsidies raised the cost of living, that only part of the money saved by reducing the subsidies went to relieve the added burdens on the poorest people, and that not all the poorest people who had to face the rise in the price of food received Income Tax relief or increased allowances from the Government.

It may be that I am wrong and that the Government are really confident that there will be no further rise in the cost of living. It may be that during the last General Election when they said that they wanted to reduce the cost of living they meant that they wanted to raise it first and then stop the rise when they thought that it had gone far enough. The Housing Repairs and Rents Bill would suggest that they do not think that it has gone far enough.

What concerns the pensioner is what his pension could buy in 1946 and what it can buy now. Every fair-minded Member of this House must admit that the pensioner, old, widowed or disabled, is worse off than the original benefits intended that he or she should be. I am not a statistician and the yardstick that I use is one that is accepted by the Government. Hon. Members will find it referred to in the debate which is reported in c. 971 of the OFFICIAL REPORT for 8th February last. There I said, and the Government spokesman confirmed, that 45s. in 1946 would have to be raised to 64s. 6d. in 1953 to be worth the same purchasing power.

On that basis let us look at some of the 1946 allowances, what they are now and what they ought to be to have their 1946 value. The pension for a totally disabled ex-Service man was 45s. in 1946, it is now 55s. and it ought to be 64s. 6d. Retirement pension for a man was 26s. and his wife 16s., making a total of 42s. It is now 54s. and it ought to be 60s. Unemployment benefit for a married man was 42s. in 1946. It is now 54s. and ought to be 60s.

A widow's pension for the first three months was 36s., it is now 42s. 6d. and it ought to be 50s. A widow with one child had 43s. 6d., now it is 52s. 6d. and it ought to be 62s. 6d. These are examples of the way in which the basic pensions have fallen behind the rise in prices. Other hon. Members will deal with some of these in detail.

I have pleaded before for the disabled ex-Service man. I am glad to see in the House this morning some of their great champions on both sides of the House, like the hon. Member for Morecambe and Lonsdale (Sir I. Fraser) and my hon. Friend the Member for Brierley Hill (Mr. Simmons) who, I hope, will be able to call attention in detail to the needs of those men. I want to look a little further at the old age pension, the retirement pension and the widow's pension.

First, I say a word about the widows, especially the group known throughout the country in every Assistance office as "the 10s. widow"—the widow whose husband died too early for her to receive the new statutory insurance benefit. These widows get only the old 10s. pension, which was not increased when the other pensions were stepped up and out of that pension such a widow has to pay the National Insurance weekly contribution if she wants to qualify for retirement pension.

It is argued that these widows are not legally or actuarially entitled to full benefit. This argument is an obsolete relic of the one defect of the Beveridge scheme, a defect which parties on both sides of the House decided to put right—the caretaker Government in their White Paper and the Labour Government when they took office. Beveridge wanted the insurance scheme to come into operation gradually over 20 years so as to conform to sound insurance policy, but we did not agree with that part of the Report and brought into benefit, years ahead of time, people who had not contributed enough.

But we left these widows out and their case is, indeed, a hard one. We are inclined to think that once a widow has brought up her children to the age of 15 she can rush out and get a well-paid job, but many of them cannot. Reference has been made in the House before to the widow of the disabled ex-Service man who nurses him. While nursing him she is qualified for some benefit under the war pensions scheme, but the moment the husband dies she disappears from the scheme altogether.

Here is the budget of a widow who started her career as a widow in grave poverty. For the last five years before her husband died he was in hospital. A son was serving an apprenticeship, but apprentices get very little money. A daughter was in a grammar school and the son, the husband and devoted wife were making great sacrifices to keep her there, sacrifices comparable to any made by a middle-class home to keep a boy at public school. Then came the bereavement. Her total income is £4 4s. because she is doing part-time work.

Her budget is: rent, 17s. 3d.; insurance 2s. 6d.; heat light and gas, 15s.; milk, 4s. 6d.; bread, 4s. 6d.; clothing club, 8s.; fares to work, 2s. 6d.; papers, 3s.; wireless, 2s. 3d.; school meals, 3s. 9d.; hire purchase, 5s. 6d.; groceries, 36s. 9d.: total, £5 4s. 6d. She writes:

Another widow has three small children aged between five and 10 years. The grand total of her State income is £3 8s. 6d. Bringing up three children for Britain ought to be a full-time job, but she has to go out to do part-time work, for which she gets 33s. 6d. Her budget is: rent, 17s. 11d.; coal, 7s. 3d.; milk, 8s. 1½ d.; vegetables, 6s.; insurance, 1s. 5d.; National Insurance, 4s. 5d.; bread, 3s. 9d.: total £4 13s. 10½d. This, she says, leaves 8s. 1½d. for clothing and everything else for herself and three children.

This widow writes:

A flight sergeant was killed in the Shackleton air crash last November. His widow and child receive £3 2s. a week yet it costs £5 to £7 a week to keep a deprived child in a cottage home or institution under the Children Act. In the street next to mine lives a widow with four children. She keeps them by working as a night nurse in Southampton Hospital.

The budgets I have quoted reveal the main items of expenditure for poor families, food, clothing, rent, heat and light. Of these, food and coal, especially, are the items which have increased in price more than anything else. Any National Assistance officer will confirm that the first extra need of old folk and poor folk today is coal. We ought either to subsidise the price of coal generally for the community, or to include it, like rent, as one of the essential things as part of the pattern of National Assistance, especially as—like rent—it varies infinitely throughout the country. As my hon. Friend, the Member for Southampton, Itchen (Mr. Morley), has often pointed out, old folk in the South pay very much more for coal than those in the North of England.

I now turn to the problem of the old-age pensioner. Here is the budget of a 32s. 6d. single pensioner. She spends: rent, 8s. 11d.; gas, 1s. 9d.; electricity, 1s. 6d.; insurance, 1s.; window cleaner. 1s.; coal, 6s.: total, 20s. 2d., leaving l1s. 4d. for food and clothing. That, I know, is not true—incidentally, I wish that those who complain on behalf of pensioners would always give the public the true facts and not exaggerate the picture—for on top of her insurance pension her rent is paid and she receives a slight supplement.

But in Southampton recently two old sisters were found by the National Assistance officer to be living on their National Insurance pension and they had not been to the Assistance Board. Either they did not know about it, or they were frightened to go. A single old gentleman wrote to me yesterday and said he was not getting the whole of his rent met by National Assistance. I rather think that is a case which I must take up with the Minister because there must be some mistake. The point is that in 1946, as against the budget I have quoted, we would have given the old-age pensioner a basic pension of 26s., which is now 32s., and ought to be about 37s.

The National Federation of Old Age Pensioners challenges the whole basis of the Government's yardstick to measure the increase in the cost of living. There is a lot in what they say. They give a budget with which I will not weary the House in detail as everyone must have seen it, but I think it is unanswerable. It shows that the cost of necessities for a single old-age pensioner, totalling 18s. 0½d., in 1946, was 35s. 9½d. in 1953, or nearly double.

I had confirmation of these figures in my correspondence yesterday when an Isle of Wight grocer sent me a list of weekly household expenses of a single old-age pensioner, basing most of his figures on 55 years' experience as a general shopkeeper. The figure he gave for the essential requirements of an old-age pensioner was 34s. a week, exclusive of rent. He writes:

For a married couple the figures are as follows. Prior to 1948, National Insurance, 42s.; National Assistance, 35s.: 1948, National Insurance, 42s.; National Assistance, 40s: 1950, National Insurance, 43s. 6d.; National Assistance, 42s.: 1951, National Insurance, 50s.; National Assistance,50s. In that year they became equal. In 1952, National Insurance, 54s.; National Assistance, 59s. There is a case for stepping up National Assistance again. It goes to people who need it most. But the real significance of these figures is that the National Insurance scale has failed more and more to provide subsistence and National Assistance has more and more had to underwrite this failure, first for half-a-million people a year ago and now for a million-and-a-quarter.

When we started National Insurance we knew that it was not insurance for a lot of people. Many older people could not hope to qualify for all the benefits they were to receive. And so, in addition to the amount which the employers and employees and the State paid, there was a second State contribution. It was decided to make a block grant of £40 million, rising to £60 million a year in addition to the State contribution of 2s. per head. It was thought that the State would have to do this to meet the pensions of old people who had not paid in all their lives for their pensions, and also to meet 8 per cent. of unemployment among the workers of this country.

There has not been 8 per cent. unemployment, thanks to good government. Because there has not been anything like 8 per cent. unemployment, the Government contribution towards this eventuality piled up, and so in 1951 the State not only slashed down its own contribution of 2s. a person to, I think, 1s. 4d.—a cut of £15 million a year—but it also reduced its block grant to the fund by £24 million a year. I know that this may be called a book-keeping transaction. I know that ultimately, grant or no grant, each year the State will have to meet the liabilities on the fund, whatever those liabilities may be in the future.

People are living longer than they used to. We have to pay retirement pensions longer than we expected. If one goes to an old folks' club one finds that the members look like middle-aged people, and they are much more cheerful than middle-aged people. These clubs in my town have their own concert parties. The marriage rate among "Darbys and Joans" is terrific. All this means that the amount paid in retirement pensions rises year by year.

Against that, it is also true that more and more people are working after the age of 65. We want that, within reason. We do not want to drive people who are physically incapable to work after the age of 65. But it is good for this country that people should be working more and more after the age of 65. If we lump these three factors together, the low rate of unemployment and people working over the age of 65 as an off-set to the longer lives of older people, it means that the insurance fund itself could rightly expect from the State its original contribution and that the insurance benefits should rise without very much demand from the State.

What is the real difficulty? The root problem is, of course, the rise in the cost of living. Every pensions fund faces this. Teachers' pensions, civil servants' pensions, local government pensions, all are based on salaries which have gone up and, therefore, the pensions have gone up. But most contributors have been paying pensions on the old salaries, and so every private pensions fund has to meet liabilities not foreseen when the actuarial tables were drawn up. This does not hurt the private pensioner, because his pension is based on the salary which has risen. But the sufferers are those who retired on pensions based on salaries which were much less than what salaries have risen to today.

These unfortunate people have watched their pensions dwindle in value as prices rise. The Pensions (Increase) Acts have helped the hard cases, though they lag behind the poverty and hardship which comes to this group. But the great army of pensioners, the mass of the British people, are not lucky enough to have private pensions schemes. No matter when they retire, or what were their wages, they are in the same boat. And if the distressed group of professional men on pensions numbers thousands, the group I am talking about numbers millions.

I have no time to say anything about people living on other fixed incomes. I would refer the Minister and the House to the recent correspondence in the "Manchester Guardian." I have only time to mention the case of the Baptist minister living on £325 a year. The Christian Church in most denominations has, I suggest, become one of the employers of sweated labour. It is for the Christian Church to put its salary scales right.

But the root cause, as in pensions, is this impact on men with fixed incomes of a steady rise in the cost of living. Roughly speaking, two groups in this country have met this rise. The well-to-do people have gained in tax reliefs, increased dividends, and profits and added income, which more than offsets the price rises. Some organised workers, but by no means all of them, have gained wage increases which offset the rise in the cost of living. But millions of lower paid workers have not had a wage increase to offset that rise.

We talk of increased production. We cannot ask the mothers of England to increase the production of babies, thereby qualifying for a rise in their rate of weekly pay and after the pensioners it is the wives of the lower paid workers, mothers with large families, who are worst off because of cost of living rises. So side by side with the demand for increases in the basic pensions we ask the Government to make resolute war on rising prices. We on this side of the House think that that must be accompanied by some form of price control and profit control. A war on the rising cost of living is a war to protect the pensioners and the lowliest groups of the community.

We have an enormous problem facing us in the next 30 years. Britain is divided, roughly, into three groups. There is a large group of old people, a large group of young people, and a small group of middle-aged people. It is rather bad for the middle group. It will right itself in 30 years' time, when the small middle group will be carried by what we call at present "the infant bulge"; but we have to get through the next 30 years, and we have to shoulder our responsibilities to the pensioners.

Who are they? First, there are the old workers who never worked five days a week with an annual holiday. They Worked much harder and for lower wages. For millions of them that work was interrupted again and again by long spells of unemployment. They had not the chance of full living that this generation has, and they certainly had not the chance to build up savings. They are entitled to what we all admitted in this House was their right in 1946 when we fixed the first scale of insurance benefits.

Then there are the ex-Service men of two wars. I really ought to say three wars, because my experience, like that of many others, is to meet occasionally a veteran of the South African War. These men gave health, sight or limb for us. We set out for them in 1946 a basic scale of pension as a right. This basic scale has been seeped away, and it is a debt of honour that we should put it right again.

Then there are the widows. I admit that this is the most complicated problem of all, but I think that we ought to be more generous, whatever the complications, and especially to the wives who gave up their husbands and most of the happiness they had the right to expect when young men died in Africa, Burma or in Japanese prison camps—young men who believed that this country would take care of the wives and children left behind.

We can meet the bill for our poor citizens in only four ways. First, by devoting to the insurance benefits more of the taxpayers money; secondly, by wise and prudent use of the money that we raise in taxation; thirdly, by increased production; and fourthly, by asking, or insisting, that the strong and the able and the merely lucky should forgo some of their share of the national cake for those who need it most.

There is a fifth way which is that of increasing insurance contributions, and that is one which I hope the House will condemn. Equal contributions from rich and poor to the insurance fund are by no means equal in their incidence. Enough is being paid in this way already. If the House doubt that, let hon. Members think of the widow getting 10s. a week and having to pay the full insurance contribution out of it. I know the old argument. Probably the dividing line between us is in our attitude to the size of differentials needed to keep incentives in operation, and the fear of making people too secure.

Nobody who has any experience of the lives lived now by pensioners and others with low fixed incomes need fear that we are encouraging idleness. Nobody wants to live on the allowance that Britain can afford to give her poor citizens if it can be avoided and if there is any other way of living. Nobody dies, of hunger in Britain today, but many people are hungry. No one faces the poverty that many of us on these benches lived in and amongst when we were younger, but many are getting much poorer today. The bottom group—the bottom tenth of Britain—is having a hard time, and whatever the House can do to persuade the Government to take action it ought to do.

11.44 a.m.

I beg to second the Motion.

This Motion has been ably and persuasively moved by my hon. Friend and neighbour the hon. Member for Southampton, Test (Dr. King) with a wealth of relevant documentation. Over the past decade we have been living through a period of controlled inflation. It is perfectly true that the cost of living has not risen so steeply after the Second World War as it did after the First World War, because we financed the Second World War in a more sensible manner than the first. We raised more money in taxation and less by loan.

Nevertheless, it is generally recognised that the £ today is worth about 8s. in purchasing power as compared with the £ of 1938. A gently rising price level may be beneficial to considerable sections of the community. It benefits business men, to some extent at least, because when the price level is rising the entrepreneur sells the finished product at a higher price level than he pays for his raw material and consequently gets some windfall in the form of unexpected profits. That brings about an atmosphere of optimism in industry and leads to an expansion of industry.

Also, of course, the working classes, if they are well-organised, and live in a free community which permits strike action, are enabled by trade union action to catch up and in some cases slightly to exceed the rise in the cost of living. Also a gently rising price level, because it gives an optimistic and expansionist atmosphere to industry, helps in conjunction with other measures to maintain full employment. It also lessens the burden of the payment of the interest upon the national debt; so that a gentle inflation, so long as it is not too rapid and too extreme, may have its beneficial effects.

In fact, I believe that there have been eminent historians and economists who have said that the expansionist periods of history have been the inflationary periods and that the stagnant and decaying periods of history have been the deflationary periods. However, be that as it may, there is no doubt that a rising price level inflicts very great hardship upon people living upon fixed incomes, and especially upon old-age pensioners.

Those people are not able to take any collective action or any individual action to raise their pensions or their fixed incomes to meet the increase in the cost of living. They depend for the most part—almost entirely—upon action taken by the Government of the day.

In 1946, one of the first actions of the Labour Government, in the process of carrying through a silent revolution, was to increase old-age pensions. When we came into office in 1945 the old-age pension was 10s. a week for the single person and 20s. for the married couple. We raised that to 26s. for the single person and 42s. for the married couple. Since that time successive Governments of both parties have made successive increases, so that today the pension is 32s. 6d. for a single person and 55s. for the married couple.

However, since 1946 there has been a fairly considerable increase in the cost of living. I am not casting the blame for the increase on either political party or on either Government. The truth is that the cost of living has been rising since 1946 whatever Government may have happened to be in power. According to the official cost of living index, the rise in prices since 1947, when the new index figure started, has been 40 per cent. I believe that there was a slight increase in 1946, so the rise in the cost of living since the pensions were fixed at 26s. for a single person and 42s. for a married couple has been just over 40 per cent.

I do not think that anybody on either side of the House would dispute that figure. Therefore, to get pensions level with the purchasing value which they had in 1946, the 32s. 6d. pension for the single person ought now to be at least 37s. and the 55s. for the married couple ought now to be 60s. My calculation is that that increase would cost about £51 million, and that represents about a 4¼d. increase in Income Tax. Therefore, we could move the old-age pensions back to their original 1946 value by the addition of 4¼d. on the Income Tax.

I know that hon. Members opposite are very anxious that the Chancellor of the Exchequer in his forthcoming Budget should reduce Income Tax, but I think that even they, if they were given the chance of raising old-age pensions to an amount which would restore their 1946 value at the cost of raising Income Tax by 4¼d., would say with one voice "Give it to the old people first."

I do not think that it would quite meet the situation if we raised the 32s. 6d. to 37s. and the 55s. to 60s. because the increases in the cost of living index have not been uniform increases. Some items have increased more than others, and some items have to some extent been reduced. Items that have increased most are food and fuel which are precisely the two things upon which old-age pensioners are forced to spend the major portion of their income. In Southampton today coal is £7 4s. a ton, and old-age pensioners who come to see me say that their chief difficulty is in getting enough coal and milk. They say that they have to drink tea without milk and sit shivering by a fire which consists of half extinct embers. Therefore I think that we should have to raise the pension a little more than I have suggested, and probably the cost of raising it to a fair level would be about 6d. on Income Tax.

I hope that the Chancellor when he presents his Budget will give priority to an increase in old-age pensions. My right hon. Friend the Member for Ebbw Vale (Mr. Bevan), who from time to time delivers, apparently without effort, such brilliant phrases, said on one occasion that "The language of priorities is the religion of Socialism." The first priority for the Chancellor of the Exchequer in the forthcoming Budget must be to increase old-age pensions. Apart from the State old-age pensioners, there are a number of occupational pensioners, such as teachers, the police and so on.

The occupational pensioners, generally speaking, have made a contribution during the 40 years of their working life to their pensions. The contribution was generally about 5 per cent., and they expected when they made that contribution that they would receive in their pensions pounds of equal value to the pounds that they contributed. That is a fair assumption. But, in fact, the pounds which they are receiving in their pensions today are worth only half the value of the pounds which they contributed during their working days.

Take the case of a class teacher who retired in 1938. His pension on his maximum salary of £366 a year as it was, would be £183. On £183 in 1938, with a few savings, he could manage to jog along, but he certainly could not jog along on £183 today. What savings a class teacher had in 1938 have, I presume, long since disappeared. It is true that there have been three Pensions (Increase) Acts in 1944, 1947 and 1952. Both the major parties have sponsored these Pension (Increase) Acts, and both have realised that they have a moral obligation to give those pensioners some assistance to cushion the impact of the increased cost of living.

But suppose the class teacher who retired in 1938 on a pension of £183 has taken full advantage of these three Acts and that he has been below the ceiling on each occasion to get the major increase that these three Acts give. His pension of £183 becomes £277 if he is married and £248 if he is single, whereas to get the value of the purchasing power of £183 in 1938 he should now be receiving a pension of £410. Therefore, these Pensions (Increase) Acts, although they have been very beneficial—and I certainly welcome all three—have certainly not met the increase in the cost of living for these occupational pensioners.

I had put into my hand today as I was entering the Chamber a cri de coeur from the retired civil servants, in the form of a circular written by Mr. John Egan, Vice-chairman of the London branch of the Civil Servants Pensioners Alliance. Mr. John Egan says:

Now I come to a class of pensioners who have my very warmest sympathy, because I think they have the hardest deal of all the occupational pensioners.

Those are the retired railway servants who have been in the supervisory and administrative grades. Up to 1953 those pensioners had received no increase at all in their pre-war pensions. In March, 1953, we had an Adjournment debate. The Minister of Transport listened very sympathetically and he made a concession. He said that he would ask the Transport Commission to increase these pensions but that he was afraid the increase would have to be subject to a very low ceiling.

There has been an increase of £20 on the pre-war pension, subject to a very low ceiling. I am told that there are 34,000 of these retired railway pensioners. The Minister of Transport promised during that debate that at least 6,000 to 7,000 of these retired railway pensioners would benefit by the concessions that he would make. I am told that only 2,800 of the 34,000 pensioners actually got the benefit, because of the fact that the ceiling was so low, and that the increase varied in different cases from 30s to £20 a year. That is another case which the Minister who will reply to the debate might take up with his right hon. Friend the Minister of Pensions.

In this Motion, we also ask the Government to make every effort to reduce the cost of living, and I am well aware that that is a very difficult matter to achieve. After the First World War, a drastic reduction in the cost of living was secured by means of a drastic and brutal deflation in 1921. That brutal deflation certainly reduced the cost of living substantially, but it also created one and a half million unemployed, whom we had with us from 1921 to 1939. We do not want ever again to reduce the cost of living by that means.

Personally, if I had to choose between the two evils of high prices and mass unemployment, I should certainly choose high prices as the lesser of those two evils. I may be controverted by my hon. Friend the Member for Nottingham, South (Mr. Norman Smith), but pursuing the orthodox line of approach to this problem, if we do not reduce prices by the deflationary method, the only way in which we can reduce them is to increase production.

I hope the Ministers concerned will take all measures which they can take to increase production, which means having a greater proportion of capital investment in our industries in order that they may have more new and up-to-date machinery. I therefore hope that the Chancellor of the Exchequer will encourage that desirable development by increasing the initial allowances in his forthcoming Budget.

It also means greater skill on the part of management in industry. I remember that, when the Esso Refinery was being built at Fawley, I asked a friend who was working there how he got on with the Yankee bosses, and he said "We get on with the Yankee bosses very well. We all like them. When they want us to do anything, they do not tell us to do it, but take off their coats and show us the way to do it, and English bosses never do that." We want much more skilled management in our industry if we are to increase production, and we want not only more skill on the part of the managerial side but a greater willingness on their part to "muck in" with the workers and work alongside them.

In the United States of America, I understand that very often the best brains go into business. In this country, the best brains often go into the professions and the Civil Service. [ Interruption. ] On this side of the House, they go into Parliament, but, generally, we want to see more people with first-class brains in this country go into business and become administrators and organisers.

Next, we have got to get rid of waste. The party opposite, from what I can only say was a momentary aberration, encouraged waste by the denationalisation of road transport, and by setting up two rival organisations to deal with transport in this country. We not only want to have more machinery and better machinery in our industries and at the same time cut out waste, but we want to deal with monopolies and bring down monopoly prices, and I think that, over a period, if we can do these things—although my hon. Friend the Member for Nottingham, South will disagree with me—we shall succeed in reducing the cost of living.

:No.

I shall listen with great interest to the point of view of my hon. Friend if he is fortunate enough to catch Mr. Speaker's eye.

In conclusion, in "Challenge to Britain," we have said that we should take the first opportunity to revise old age pensions in accordance with the increase in the cost of living. Perhaps the Minister would like to take a leaf out of Disraeli's book and "dish the Whigs" by saying that he hopes his right hon. Friend the Chancellor of the Exchequer will announce in his forthcoming Budget speech an increase in pensions. That may not be a bad thing considered from the point of view of the effect upon the electoral fortunes of the Conservative Party at what we understand to be the forthcoming General Election.

I know that the Chancellor of the Exchequer will never have in mind such base considerations as the electoral results of such a policy, but the effect would not be at all bad for the Conservative Party if they increased the old age pension in the next Budget. In any case, it would be a good thing indeed for the pensioners themselves and a humane act, as well as one which would be generally approved by the people of all classes in this country.

12.7 p.m.

I want, first of all, to make an apology to the hon. Member for Southampton, Test (Dr. King), who moved this Motion, for not being here at the beginning of his speech, but he understands the reason why. I should also like to offer him my congratulations on his fine speech in opening the debate.

An occasion like this is one in which we all like to take part, because, on both sides of the House, we all want the same thing—that is, to help the old-age pensioners and people living on fixed incomes who are badly off through no fault of their own. I think that the only difference that we shall find between us in this debate is how that objective is to be brought about.

It is, of course, superficially attractive to tie pensions to the cost of living, so that, if the cost of living goes up by an appreciable amount, so do the pensions, but, of course, the difficulty there is that if, as we all hope will be the case, the cost of living comes down substantially, it is difficult also to bring down the pensions, and I think what the right hon. Gentleman the Member for Llanelly (Mr. J. Griffiths), who is sitting opposite, may have felt much the same way during his period of office, because he said at that time that it was undesirable and impracticable, and that a system like that would eventually break down.

No doubt someone will speak from the Front Opposition Bench in this debate, and it will be interesting to know whether that is still the view of the right hon Gentlemen on the Opposition Front Bench. It is still my view, though. because of a statement made in "Challenge To Britain," it looks as if that idea has come back again. I do not think it would work, although it is superficially attractive. It does not help the people who are on small, fixed incomes but only those genuinely on the present old-age pension.

The finances of a Welfare State will break down if we give public money to people regardless of whether they need it or not. That is why I was in favour of reducing food subsidies which went to everybody, those who wanted them and those who did not. That is why I have told my branch of the British Legion—I have been a member of the British Legion since it started—that to raise the basic pension for everybody would be a mistake and that we must help those who are in need. Very soon, everybody will be in receipt of the old age pension. I myself will get it some time. We must give adequate sums to those who are in need, whilst keeping the basic pension for those who do not really require it at a reasonable figure not as high as we give to those in need.

That brings me to the next question: How are we to do this? Should a separate body be set up to deal with old people? An answer is that both sides of the House have already established the National Assistance Board to deal with people whose incomes are inadequate. During the time of the Labour Government, from 1945 to 1951, any vestige that remained of the Poor Law was taken away. We all agree that the National Assistance Board works extremely well and that its officers are sympathetic and are doing an excellent job. We hear that from everybody. The trouble still is that certain people will not go to the Assistance Board, under the impression that it is some form of charity, while apparently the old age pension is not. I wish we could break that impression down.

I am wondering whether it would be possible to nominate certain people under the Assistance Board to look after old people only. We could call it "the old people's branch" perhaps. Their job would be to know all the old people in their districts, and to see that they were properly looked after and had adequate coal, money and other necessities. We should have to call them something different from the "National Assistance Board" perhaps "Old people's officers," or something of that kind. They could look after the old people in a way which does not seem possible at the moment by giving a basic level of pension.

I saw in "The Times" of 13th March that there had been a survey. I hope other hon. Members read the report. It was very interesting. The authors stressed the point that more people are needed to look after the old. They particularly said that some old people were in need of more coal and milk, although, on the whole, the old people seemed to be adequately fed and their homes adequately heated. If we could supply those things to old people who need them we should be doing an exceedingly useful thing.

What was the date of "The Times" report?

It was 13th March. This is the Oxford survey. Perhaps I shall get a copy of the report.

We must not exaggerate the problem. Perhaps the only people who can tell us whether old age pensioners are suffering from malnutrition are the British Medical Association. The last report said that in the past they had been 7 per cent. below what they call "the calorie intake" which was necessary, and that now the figure had moved up to 4 per cent. above. We know that figures can prove anything, but those figures seem to show that although the problem is with us not a large number of people are in or near the starvation level.

From where did the hon. Baronet get those last figures?

From the National Food Survey of 1953. I will get the actual quotation, but I do not think that what I say is inaccurate.

There is the other problem to be remembered, the aged, chronic sick, who often have no help at all, and among whom there is a tendency to malnutrition when they do not go into hospital because of shortage of beds.

We had an interesting debate on the subject not very long ago.

Another point I want to mention is that we cannot rely for information about nutrition upon the mere fact that there are people who do not take up then-rations. I have to make an admission; I do not take up my rations. I suppose I am counted as one of the old people who do not take up their rations. My reason is that I live in what is called a "catering establishment," and that my ration book is kept and ruled off in that place while the rations are taken up in a different way. There must be many other people who do not take up their rations for similar reasons, and not for the reason that they are starving.

Does not the catering establishment take up the rations for them?

No. As a matter of fact, I always keep the ration book and do the ruling-off myself. There must be many other people who do that, such as those who live in service flats and boarding houses. I am using this point partly as an example to show how difficult it is to prove by statistics whether old people are really badly off or not. The importance of the survey was that it was carried out at first-hand by people going round and asking the old people questions. The result was very illuminating. What would help everybody would be a reduction in the cost of living. It has been steady for a long time, and all of us now wish that we could bring it down.

In the meantime, I agree with what was said by the sponsors of the Motion and I have no intention of voting against it because I heartily agree with it. Nevertheless, there is a queue of people always waiting at the door of the Chancellor of the Exchequer's office before Budget Day. It includes Members of Parliament, war pensioners, teachers and all kinds of people, but I should say that at the head of the queue should be the old-age pensioners.

I believe a selective system of looking after these people is more desirable than a large, general rise. If possible, we could perhaps have a small rise at the present moment, but, in any case, as the population gets older we shall have to devise a scheme whereby old people who are really badly off are properly looked after, because, after all, they will have deserved well of their country in the past.

12.20 p.m.

I wish, first of all, to express my gratitude to my hon. Friend the Member for Southampton, Test (Dr. King) for expressing his pleasure at my presence this morning. I can tell him that the inconvenience I experienced has been amply made up for by the opportunity of listening to his very excellent speech. I also wish to congratulate him on using the opportunity afforded to him in the Ballot to ventilate this very important human problem. Many who are fortunate in the Ballot select problems which may appear to the average person to be more popular, but to select a subject such as this appears to me to reveal a profound interest in the lot of the old people and those in the lower income group. My hon. Friend must have spent a great deal of time and research in collecting all the information on which he based his speech.

Since 1951, and even before that date, the question of the hardships being experienced by people living on fixed incomes has become more acute every month, and almost every week. Numerous decent citizens have called the Government's attention to those hardships, and this week has been an outstanding one in that connection. When we opened our copy of "The Times" on Monday morning we found a very excellent letter on the question of retirement pensions, and on Monday afternoon a large number of Questions were addressed to the Minister of Pensions and National Insurance. We know the replies that we received to those Questions.

On almost every day since there have been Press reports about people who have this matter under consideration. To my mind, one of the most amazing features in this connection is that people who are comparatively well-off are now showing an interest in the hardships being experienced by those in the lower income groups, in which, of course, the old-age pensioner is undoubtedly included. Only this morning there is a Press report to the effect that a committee of Conservative Members is gravely concerned about these hardships. That suggests to me that this is not a party question, but one of great human interest. It is a great human problem which will become intensified as the days go by.

I do not propose to argue about the cost of living at the moment, but I just mention these facts in order to prove to the House that there is a strong feeling among decent-minded citizens throughout the country that something should be done for these unfortunate people whose incomes have remained static for a number of years. Only yesterday, one London newspaper came out with a headline in big type which stated:

I would mention, incidentally, that I got across the Minister on the Industrial Injuries Bill. However, I have forgiven him for what he said, and if he will respond to the appeal that will be made to him from both sides of the House today, I will forget the incident. We all say things in the heat of the moment, and it may be that in the heat of the moment he used the expression to which I made some very strong objections. I wish to tell him this morning what a leading newspaper said about his replies to the Questions put to him asking for some improvement in the basic old-age pensions. I do not want him to think-that I am being vindictive. It is not in my nature to be that. I may be straight and a little blunt in expressing myself, but I am not vindictive.

The newspaper said:

Will the hon. Gentleman give us the source of that information—the name of the newspaper?

That information comes, as I know the hon. Gentleman will surmise, from the "Daily Herald."

A great deal has been said about the cost of living and its effect upon the lower income groups. We have been told on several occasions that the cost of living has not increased, that it has remained static. If there has been any alteration, it has been about 2 points. When I talk to old folks about 2 points, I am reminded of the story of the old collier who, when I told him of an improvement in his wages to the extent of a decimal point, said: "Ah, but I am not concerned about decimal points. What I want to know is, can we spend 'em?" It does not mean anything to the old-age pensioners when we talk about the cost of living going up only 2 points.

I want to indicate the effect of the increase in the cost of food. I have here a chart showing the prices in January, 1951, and in January, 1954. Those are very important years. It gives the rise in prices of eight or nine commodities. I shall not wearry the House with a large number of them, but I think it is important to give the prices of the essential foods. In January, 1951, the cost of 10 loaves was 4s. 7d. and in January, 1954, it was 6s. 3d. In January, 1951, the cost of 18 pints of milk was 7s. 6d. and in 1954 it was 10s. 6d. Eggs have remained at the same price of 3s. 6d. per dozen. Twelve pounds of potatoes in 1951 cost 1s. 9d. and 2s. 6d. in 1954.

Will the hon. Gentleman say what chart he is quoting from?

I am quoting from the Co-operative Wholesale Society chart. In January, 1951, flour, 2 lb., cost 6d. and in January, 1954, 1s. 1½d. Butter, four rations, 1951, 2s., 1954, 2s. 6d. Margarine, four rations, 1951, 10d., 1954, 1s. l1d. Sugar, 1951, 1s. 0½d., 1954. 1s. 9½d. Cheese, four rations, 1951, 7d., 1954, 1s. 7½d. Bacon, 1951, 2s. 7d., 1954, 4s. Cooking fat, 1951, 6d., 1954, l0d. Meat, 1951, 4s., 1954, 8s. 8d. Coffee, 1/2 1b 1951, 1s. 10d., 1954, 2s. 9d. Tea, ½ lb., 1951, 1s. 8d., 1954, 2s. 5. Tea is an essential commodity for the old folk. The total cost of these commodities in 1951 was £1 12s. 10½d., and in 1954, £2 10s. 4½d.

Another striking piece of evidence which enforces the arguments put forward from this side is to be found in the Government's own figures of the number of people who since 1951 have had to seek assistance from the National Assistance Board. I know that the Joint Parliamentary Secretary will agree that when I led a deputation a few months ago to his Department, he told us that he was gravely concerned with the rapid increase in the number of people who were having to seek assistance from the National Assistance Board. I think that these figures prove that there has been some rise in the cost of living and that more people are being compelled by economic circumstances to seek assistance from the National Assistance Board.

As my hon. Friend the Member for Test said, it is not the administrative side that is wrong. They are doing a grand job of work. They are assisting in every conceivable way, but they are tied hand and foot and cannot go as far as they would like. Time and again I have had discussions on these matters. I have met the National Assistance Board investigating officers and they have said, "I wish we could go further, but we cannot. We are charged with the responsibility of adhering to the regulations." It would be very helpful if there could be a little more elasticity in the regulations.

I remember my right hon. Friend the Member for Llanelly (Mr. J. Griffiths) telling us that the National Assistance Board officers would be afforded great discretionary powers. They have to a degree tried to use these powers, but there are a number of cases which they cannot help as much as they would like.

It is not my intention to weary the House with a large number of figures, but I think that the figures which I shall give prove conclusively that there is a growing number of hardship cases. On the 27th March, 1951, there were 1,383,734 people who had to go to the National Assistance Board. On the 26th January, 1954, the latest available date for which I can obtain figures, there were 1,781,879 people who had to seek National Assistance.

It is a fact that the increase in the numbers on National Assistance in 1953 was the smallest increase for any one year since the 1948 Act came into force.

If I could give the hon. Gentleman the figures all along the line it would help him considerably. I have given the number of people applying to the National Assistance Board in 1951 and the number of people applying for assistance in 1954. If he will take the trouble to look at the National Assistance Board's statistical returns, he will find the figures given month after month, and he will also find that during the period 1951 to 1954 there was only one quarter when the figures went down.

Ought it not to be put on record today that there are more old-age pensioners seeking National Assistance than ever before in the history of the country?

I am much obliged to my hon. Friend. I was going to mention that. Never in the history of this country have so many people had to seek assistance from the National Assistance Board. That is conclusive evidence that people are becoming worse and worse off.

There is another interesting point which I want to put to the Joint Parlia- mentary Secretary. I have taken the trouble to look up how the income groups, higher and lower, spend their incomes. In the income group £13 and upwards, in which the percentage of persons is 6·6, and the average size of family three, the average weekly outlay on food per family is £3 13s. 3d. Not more than 28 per cent. of the income was spent on food. In the income group £8 to £13, in which the percentage of persons is 26·5 and the average size of family three and a half, the average weekly outlay on food per family is £3 10s. 10d., which is between 27 per cent. and 44 per cent. of income spent on food.

In the income group £4 10s. to £8, in which the percentage of persons is 49·6 and the average size of family three and a half, the average weekly outlay on food per family is £3 3s. 7d., which is between 39 per cent. and 70 per cent. of income spent on food. In the income group with less than £4 10s., in which the percentage of persons is 14·6 and the average size of family is three persons, the average weekly outlay on food is £2 13s., which represents not less than 58·5 per cent. of income spent on food.

I now come to the old-age pensioners. The percentage of persons in this group is 2·7, and the average size of family is one and a half. The average weekly outlay on food per family is £1 4s. d., which represents not less than 53·5 per cent. of income spent on food.

It is evident from the table, which is a reliable one, that the poorer people spend a higher proportion of their income upon food than the richer people do. Moreover, there are twice as many people in the lower income groups as in the groups with an income of more than £8. These figures reveal that what is essential for the old people is that they should have sufficient money to buy food, coal and light. Our old folks do not want Daimler cars or mink coats; all they want is sufficient to give them a decent standard of living.

All Government Departments charged with the responsibility of looking after these poorer people should get together over the problem. Where there is a will there is a way. As my hon. Friend the Member for Test said, they will have to knock hard at the Treasury door. I have said before, and I have not altered the attitude which I took many years ago, that the Treasury are the niggers in the woodpile. If we can break down their hard-heartedness and their habit of watching Government finances at the expense of our poorer people, we shall have done a good thing.

I ascertained the amount of money that we have remitted to our Colonies. I am not complaining about it. However, I found that about £611 million of debt has been written off by Great Britain. If we could have spent that money here to help the poorer people, it would have been a good thing.

To me, life is a wonderful thing. It is wonderful to live, to stand on this fair earth beneath the radiant heaven, possessed of the gift of human life, with its great possibilities, lofty ideals and noble aspirations, which are that all men and women who have given of their best to industry and commerce shall have an opportunity to live the highest attainable life in mind, body and spirit, which they cannot do unless their economic conditions are raised to the highest possible standard.

12.45 p.m.

I am sure that all hon. Members and many people outside will welcome the opportunity taken by the hon. Member for Southampton, Test (Dr. King) to bring this matter forward for discussion. I very much appreciate the sympathetic, human and kindly spirit, and, to a very large extent, the non-party spirit, in which the debate has proceeded.

After a devastating and costly war a nation cannot expect to be as rich as it would have been had the war not occurred, or, possibly, even as rich as it was before the war. Consequently, our total pool of wealth out of which all the good things that we should like to see done can be done must be expected to be smaller and more precarious. It therefore follows that Governments of any party for some years after such an event as the last war cannot, in the nature of things, do all that they would wish to do, and must make up their minds what they can do first and what they ought to do first.

This is a general debate, and I know that many hon. Members on both sides of the House wish to speak. If all of us speak about everything that is in our minds and hearts our speeches will be too long. It will perhaps be understood if I confine myself primarily to one subject that is in our thoughts today. Because I have the honour to be the President of the British Legion, I wish to confine myself to the position of war pensioners.

I would first point out that the British Legion is composed of men and women of all classes, grades and income groups within the community. It is composed of the old, the poor and the sick, and, therefore, it is mindful of the needs of all persons and realises that any Chancellor at any time must give proper consideration to the needs of the old, the sick and the poor.

I shall try to convince the House and, I hope, the Government that there are reasons why this is an appropriate time for some major adjustments to be made in war pensions. I shall try to do so without going into too much detail. Since the war, successive Governments have added substantial sums to the annual war pensions bill mainly by increasing special allowances. In 1946, the basic rate was raised by 5s. by the Government at that time; in 1952, the Government raised the basic rate by 10s.; and throughout that period there have been continuing improvements in the special allowances.

I place it on record that the special allowances, to which all parties have made valuable contributions, have very greatly improved the position of those who are disabled in the most serious degree. I am not prepared to say that all cases are yet adequately dealt with, but it is, nevertheless, a fact that very great improvement has been brought about. Such cases represent an important element among our disabled ex-Service men, but they number about only 50,000. The number receiving all the special allowances last year was 400 or 500, and the number receiving one or more of them was probably a few thousands.

Now we come to the difficulty in which the country finds itself and to which I ask the House to give its attention. Ninety-four per cent, of all our pensioners are now receiving, by way of total compensation from the Ministry of Pensions, a sum of money which buys less today than ever it did in the last 30 years.

War widows have to go to the National Assistance, and there are many civilians' widows who get more from National Assistance than the war widows get from the Ministry of Pensions. In addition, there are some widows of persons who have rendered long service and who have died from natural causes who receive larger pensions than the widows of those who died in the war.

These facts seem to me to require looking at, and that is what I propose to do very briefly. The nation will say to itself, "How can we measure what we owe today to these people?" and I will venture to put before the House a measure by which that can be done. If we compare the period between the wars and now it will be found that the wages, salaries and the cost of commodities generally, broadly speaking, have risen two-and-a-quarter times. I want the House to bear that figure, two-and-a-quarter, in mind.

If we are looking for a base upon which to make a calculation it will, naturally, have to be a most substantial and longstanding base. It is a fact that the 100 per cent. disabled private soldier has received 40s. a week for as long a period as 27 years, from 1919 to 1946. That is a long time for a figure to remain stable in spite of the ups and downs of the cost of living, and my friends and I take that figure as a good, well-established and sound basis from which to start.

Having found a figure we have then to choose a year. What did that figure buy in a particular year? Then we have to think of it in terms of the figure that is necessary to buy the same goods and services today. We have, in fact, chosen the year 1938 for our calculations. It is not the best year for us; it is not the worst year for us. If we had chosen 1932 we could have asked for a much larger sum than we are asking for. If we had chosen some other year out of the 27 it might have been the other way round. But we chose 1938 because it is a year at the end of a long period of peace, and just before the advent of the Second World War upset economic affairs and all other calculations. Then we must choose a yardstick or what is called an index.

What index did we choose? We chose the consumers' goods and services index. A previous Minister of Pensions once spoke of that as though it were a personal invention of myself and my friends in the British Legion. That is not so. The consumers' goods and services index is a most respectable yardstick used by the Treasury to judge the alterations in the value of the purchasing power of the £, and it is used every year by the Treasury in producing its annual survey. Moreover, it has been used by members of this House in making certain calculations, of which everyone will be aware, in the last few months. It is a respectable index.

I will not deny that there is another index which could be used. I call it the Boer War index, because it was based upon commodities in common use among poor people in 1904, just after the conclusion of the Boer War. It may interest the House to know that in the list of commodities which poor people were supposed to need in those times no toilet requisites were included. I suppose they did not shave or brush their hair, or if they did it was not presumed to cost them anything. There was no beer in it, though I think that beer was cheap enough then. There were only potatoes and no other vegetables. If people lived on potatoes only they must have become introspective or whatever the right hon. Lady the Member for Fulham, West (Dr. Summerskill) would advise me is the proper thing to say.

Not on potatoes only.

Potatoes only without any green vegetables. There were no prams in this index. I suppose the poor people carried their babies on their backs. There were no books. If any Minister is prepared to argue that calculations should be made on an index so out-of-date as that index, which has already been rejected by both Governments, I should be very surprised. But it is only by reference to such out-of-date calculations that we can show that the figures at present in issue to disabled ex-Service men are anything like what they ought to be on the cost of living scales.

If we apply the base that I have mentioned of 40s. and the date I have chosen of 1938 to the consumers' goods and services index to the ex-Service men's war pensions it will be found that the 55s. which they are now receiving ought to be 90s. I am told that this is unrealistic. It is not unrealistic in so far as its purchasing power is concerned. We do not consider it unrealistic in the capacity of the nation to meet this debt. Many of my friends in the British Legion would call it a debt of honour, because they feel that promises are involved, and that Parliament ought to see that they are kept.

If it is said that this is a high figure to consider, may I, in a minute or two, call in evidence an extrinsic, outside, impartial witness, which shows what some other people think are proper amounts in this respect? I am calling in evidence a settlement made in a court of law quite recently. A fireman went with two other firemen into a burning house. They were all warned by someone inside the house that there were oxygen cylinders inside and they had better be careful. Notwithstanding that, they entered the house and, in putting out the fire, they were blown up. Three of them were most grieviously injured, two in the highest degree and the third in a very severe degree.

I will take one of those cases, not the officer but one of the rank and file, for my illustration. He was a man of 43. He had three children and he was disabled in the highest degree. He gets the industrial compensation and allowances appropriate to his disability, which are comparable with the amounts of the ordinary war pension. But, in addition to that, he gets £15,000 compensation through the courts, and if that is translated into a Post Office annuity, and if allowance is made for Income Tax, which he will have to pay, it will mean that today he is receiving over £18 a week. In other words, he is getting three times as much as the war pensioner similarly disabled would get, and the compensation found by the court, taken by itself, is twice as much.

So as not to mislead the House, or to make the House feel that I have not thought about these subjects, there was, of course, negligence in this matter and it may be thought that this vitiates my argument. I do not bring forward this case to denigrate the fireman—on the contrary I praise him for his gallantry and wish him the best of luck—nor do I ignore the implication of negligence; my point is that, if there is an argument between the British Legion and the Treasury as to what is the right amount and what scale it should be based upon, I call the attention of the Treasury to the fact that an independent settlement, made under the aegis of a court, places the situation of a man who has been totally disabled at the high rates I have mentioned. I am not saying that they are right or wrong; I am saying that they are very high by comparison with what is done for the ex-Service man, and that we ought to take into account this outside and separate and independent judgment.

In case there is any misunderstanding about this among my colleagues, may I say that it is known that N.C.Os. and officers receive differential rates of pensions and that these differentials of a few shillings a week extra for corporals, sergeants, warrant officers, and so on, have been an established part of our pensions code for a long time. The British Legion is not asking that a proportionate rise, comparable with that given to the private, shall be given to the N.C.Os. and officers. On the contrary, it is asking that the same flat rate rise which is given to the private soldier shall be given in the case of N.C.Os. and officers.

I know the House will understand, so I need do no more than mention it, that when we talk about a rise to 90s. that is a rise in the basic rate of war pension received by men disabled in the highest degree. Only a very few thousands get that rate, or the rise indicated by that rate. The majority get 80 per cent., 70 per cent., 60 per cent., 40 per cent., and so on, of that amount.

To have all the facts in our minds I should add that the total cost of the proposal which we have asked Her Majesty's Government to consider, and which we put before previous Governments, would be between £24½ million and £28½ million. I earnestly hope that the House and the Government may feel that this is one of those claims which has been outstanding long enough and that it ought now to be met. I shall conclude by mentioning three reasons why it seems to me that thoughtful people in all walks of life may be disposed to allow a claim of this kind to have priority.

The first claim is that the men concerned are dying out. Half the pensioners are from the First World War and half from the second. Those from the first war, together with a few from the Second World War, are dying off and last year 15,000 of them died. Therefore, any increase that is made in the war pensions bill, so far as the nation is concerned, will rapidly run off during the next few years. Secondly, these are a limited, definable class and so it is administratively easy to do what is asked.

Thirdly, the basic rate of war pension benefits all pro rata. It adds to that element of their pension which they have as of right and not at the discretion of any Minister. It is in line with the long-established policy of not making the war pensions dependent upon earnings or unemployment or the other hazards of life, but of retaining it simply as a measure of the extent to which the person has been reduced below normal by comparison with ordinary people in the conduct of daily life.

Half our pensioners are getting older and to them disabilities are not so easy to bear as they were. They have been handicapped in the race of life, and though some may have succeeded magnificently and a great many of them work and take a part in life which we admire, the fact remains that in their work and in their play, by day and by night, they are handicapped, they suffer from pain, and this gets worse as they get older.

Lastly, Sir, it has been a long tradition in our country, supported by successive Parliaments until more recently, that soldiers, sailors and airmen are admired and loved by the people, especially when they are going to war. We ought not lightly to refuse to call them to mind and to see that they are properly looked after when they come back from war.

1.6 p.m.

I am glad to have the privilege of following the hon. Member for Morecambe and Lonsdale (Sir I. Fraser), speaking, as he does, as President of the British Legion. I shall not follow the hon. Gentleman into statistics because I want to put the simple case which is summed up by saying that the war pensioner, in common with other pensioners, is hit by the rise in prices and therefore is entitled to consideration from the Chancellor of the Exchequer in framing his Budget proposals.

For 27 years the disabled man was on a basic pension of 40s. a week. In 1939 the basic pension of the incoming soldier in the new war was fixed at lower than the 40s., at 32s. 6d. In 1946 the basic pension was increased to 45s. in recognition of the increase in prices, and in 1952 to 55s. Surely it is not extravagant for us to ask that the basic pension should again be increased from 55s. in view of the increased prices which we are having to pay?

We should emphasise that the war disability pension is granted to compensate those who receive it for suffering and loss of amenity. It has no relation to wages in the outside market. It ought to be made a criminal offence for any employer, when fixing wages, to take into account the pension received by a disabled man. That ought to be made perfectly clear. Again, the amenities enjoyed by people today are much greater than in 1919, and therefore we have a right to ask that the disabled man should not be kept to the standard of amenity enjoyed in 1919 but should share the greater amenities of today with everyone else.

To the simple request for an increase in the basic pensions to compensate for rising prices there should be added a plea for special consideration for the very badly disabled and the ageing disabled. I shall not say that the ex-Service man today generally speaking is not considerably better off than he was at the end of the First World War. I had the privilege of being at the Ministry of Pensions for just over two years, and I know the general human concern for the well-being and welfare of pensioners that permeates the whole of that Department.

I remember as Parliamentary Secretary being told one day by a fellow Member that there were a couple of ex-Service men busking outside the hotel where he stayed. He said that it was a disgrace that ex-Service men wearing medals should be playing a banjo and singing outside an hotel because of the economic position in which they found themselves. I asked the welfare department to find out something about these men. A representative of that department found the men and told them that if they were in difficulties there were welfare offices in London where they could go and have their cases fully considered. If they were not receiving the right amount of disability pension or supplementary allowances to which they were entitled the matter would be put right.

He told them that he thought it was not good for the morale and well-being of ex-Service men generally that they should be doing that kind of thing. They never went to the welfare office and never went back to the same spot where they had been busking. Probably they were not ex-Service men at all but were wearing the medals to excite public sympathy. There is no ex-Service man today who needs to live on his basic pension. The ex-Service man who has a disability so great that he needs extra assistance can obtain it under the existing scheme.

The French have what they call a grande blessé rate of compensation for men with serious multiple injuries. It should be emphasised that in this country a man who has lost two legs receives 100 per cent. pension but a man who has lost two legs and two arms receives no more than that 100 per cent. It is true that that man often receives supple-mentaries to compensate him to a certain extent but he does not receive real compensation for the mutilation which he has suffered. There is a case for special consideration for those who are suffering in this way from a normal 100 per cent. incapacity plus what perhaps one could call another 150 per cent. incapacity. There are now in this country 303,525 1914–18 war disabled pensioners and 209,000 of these have a disability of 50 per cent. or over. Their average age is 64.

This brings me to my plea for the ageing pensioners. I can speak with most experience from the point of view of the aged limbless ex-Service man, but the same thing applies to a degree to all our ageing pensioners. War disabilities have made them more vulnerable to the ills that age is heir to. Their powers of resistance has been weakened by years of incapacity and suffering. A man who has worn an artificial leg for 35 years or more—and I have worn one for 35 years—finds it a greater burden at 64 than he did at 27 years of age. He tires more easily than he did when he was first fitted with the limb.

One has to convince the medical chappies, and they are very difficult to convince as a rule because they have certain fixed ideas, but I am perfectly convinced that a man who is wearing an artificial leg is putting so great a strain on the paired leg that that leg is bound to deteriorate. On the advice of the medical division the Ministry always turns down the idea that that is so, and the limbless man has to continue to be compensated by a fixed pension computed by means of a tape measure. There is a very strong case for an extra allowance for an ageing ex-Service man of over 55 years of age because of the disability that he suffers on top of his actual war disability as a result of the weakening of his powers of resistance. Such men have a claim to early consideration of their special needs.

I want to be perfectly fair to this and the previous Government and to emphasise once again that no disabled man need be living on the basic pension. Many live on the basic pension plus supplementation.

Could the hon. Member enlighten us on that point? As far as I understand, there are 60,000 or 70,000 men suffering from 60, 70 or 80 per cent. disability who receive only the appropriate basic rate and no supplementary allowance at all. They may have unemployment benefit until that runs out, but after that there is nothing else. They are therefore living on their basic pension unless they go to the National Assistance Board.

I think that the record of the Ministry of Pensions and National Insurance will show that the majority of these men are in employment. That is due to their own resolution and determination to work despite their disability, and the splendid rehabilitation carried out by the Ministry in conjunction with the Ministry of Labour and National Service. They have overcome their difficulties to such a degree that they are now at work, but if they are unable to work, owing to something in addition to their war disability, they are entitled to income from other social services which cater for them. Broadly speaking, though it is possible for exceptions to be quoted, it is right to say that with the system of supplementary allowances which has been very strongly developed since 1945 no ex-Service man needs to live purely on his basic pension.

To reply to the point raised by my hon. Friend the Member for Morecambe and Lonsdale (Sir I. Fraser), and to bear out what the hon. Member for Brierley Hill (Mr. Simmons) has just said, we do not know of any case of a pensioner having to live on his basic pension alone. 'We would be very glad to know of one if any hon. Member can produce a case for us.

I am very glad of that intervention. When I was at the Ministry my Minister on several occasions made a public challenge through the Press to anyone who could produce such a case and bring it to his notice. As far as I remember, only two cases were produced. Both were investigated and it was found that they were due to the men's own ignorance of the provisions that were available to them. The cases were put right straightaway.

According to figures that I have for last December, the present 35s. a week unemployability supplement was then worth 31s. 6d. Therefore, the cost of living has had its impact on both basic pensions and supplementations. I protest against some of the extravagant claims that the Press are making and the way they are handling the claim of the British Legion. I do not blame the British Legion, but I blame the sensational Press. I saw an article some time ago in the "Daily Sketch," which did not even get the figure right. It asked:

The Chancellor is well versed in figures and statistics, and we want to send the Minister to him with a moderate and factual case. We shall not do any good by exaggerating our claim, nor our case.

I contend that there is a good, sound, solid case for the increase of the basic rate of pension to maintain pace with increased costs. That matter, I suggest, has to be worked out by the Departments which are used to dealing with figures and statistics.

I wonder what the hon. Member would say about this. From his point of view I know it is an imaginary position, but it is important. Suppose that prices had not increased and general incomes, other than ex-Service pensions, had all gone up, would he not still say there was a case for an increase in the basic pension?

I think it would be a difficult case to establish, but I go back to what I said earlier, that the disabled man is entitled to the same standard of amenities as the general community. I think that covers the point raised by the hon. Member.

The war pension issue has been lifted out of the arena of party politics, and we want to keep it out of that arena. Members of all parties are agreed that the war disabled should be compensated for rising prices by an increase in the basic rate to meet those rising prices. I emphasise the point made by the hon. Member for Morecambe and Lonsdale.

War pensioners are a dwindling number, especially the limbless of the First World War; in the five years from 1948 to 1952, they were reduced by 3,689. I am glad to give those figures because, in a previous speech, I said that they were being reduced at the rate of 1,000 a year and I find from figures supplied by the Minister that I exaggerated the figure. There were about 40,000 fewer 1914–18 pensioners drawing pensions in 1952 than in 1948. I am not assuming that they are all dead, but, as they were 1914–18 men, I should think that very probable. In the three years ending March, 1952, expenditure by the Ministry of Pensions declined by £6,140,000. This decline took place in spite of the increase in the basic rate and in spite of the other improvements made by the Ministry of Pensions.

These facts ought to convince the Chancellor. I know that the Minister and the Parliamentary Secretary, in dealing with war pensions, will not need any convincing. They know the case; it is the Chancellor we have to convince. My hon. Friend the Member for Ince (Mr. T. Brown) was rather emphatic in his strictures on the Treasury and, to a great extent, I agree with him that the Treasury is the nigger in the woodpile, especially as Departments like the War Office, and all the Defence Departments, can get what they want. We can pay for the fighting of war, but, when it comes to the human damage done by war, the Treasury consider that that is another story.

I do not want to get heated. This is an important matter. We have not to threaten the Chancellor, nor brow beat him, nor mislead him, but we have to convince him. I think these facts ought to convince the Chancellor that it would cost practically nothing to do justice to this small number of men that is dwindling every year. If he would say to the Ministry of Pensions and National Insurance that there is to be no reduction in its expenditure on war pensions compared with the past three or four years, I think the Ministry could meet the demands of the dwindling number of men concerned.

I claim that we must give the ex-Service man special consideration because he made special sacrifices. He left home and family for foreign fields at inadequate pay—a "bob" a day in 1914. These men made sacrifices and generous promises were made concerning the future of them and their dependants. In the last war, despite what was said about the equal danger for soldier and civilian, those in the Forces in general suffered extra anxiety and discomfort.

We are living in an era of planning and tidyness. We like to see things tidy and to plan things nicely. When we do so we sometimes lose the human touch and overlook human considerations. I want to guard against the tendency to lump the war disabled with all other social security recipients. I think that is a mistake. Their case is different. They went out as young men to fight in an old man's war. They only ask for recognition of their services by just and equitable adjustment of their pensions to meet present economic and social trends.

1.28 p.m.

I wish to say how grateful I am to the hon. Member for Southampton, Test (Dr. King) for putting down this interesting subject for discussion. I wish to support what he said about the "10s. widow." I have interviewed a considerable number of them and I never understood their case until I heard it made by the hon. Member. I hope something will be done about it.

We listened to many other examples of hardship related by the hon. Member and other hon. Members, but there is a section of the community for whom I am particularly sorry and about whom no one says anything. That are the poor old folk who live on a few pounds a week which they receive from annuities, fixed interest preference shares, life insurance policies, and so on, which have lost much of the value which it was thought they would have when they were purchased. These old people are too proud to apply for any assistance, or even to let their friends know that they are starving. In some cases they have not been able to buy clothes for many years.

No reduction in Income Tax is of any benefit to them, because very few of them pay Income Tax. They have no powerful association to fight for them and no one to take any interest in them at all. The only way they can be helped is by bringing down the cost of living. Unfortunately, every increase gained by organised bodies of workers makes it more difficult for the cost of living to be reduced and for this type of person to be helped.

Like all other hon. Members, I am in sympathy with the old-age pensioners, but the rate of pension for them in Northern Ireland is a matter for the Northern Ireland Parliament, which, of course, keeps in step with whatever rate is fixed by the Government of Great Britain, so that I do not propose to say anything about old-age pensioners this afternoon. I feel very strongly that if any increase is made, priority should be given to the war disabled men who have made such sacrifices for us and the country, and also for the war widows, and I shall confine my remarks to two cases of hardship concerning them.

There is one class of widow that most appeals to the sympathy of us all. I refer to the widows of war pensioners who died before 3rd September, 1939. Briefly, the position is that widows of men whose marriage took place after their late husband was wounded, or removed from duty on account of invaliding disability, are not eligible for pension if death occurred before 3rd September, 1939. This was known as the post-injury marriage bar. Where death took place after this date the pension is paid if death can be proved to be due to war service.

The decision to pay pensions irrespective of the date of marriage was made towards the end of the late war with retrospective effect from 3rd September, 1939, to cover recent cases which might be effected. Consequently, all the widows whose husbands died prior to 3rd September are still left out in the cold although the Government have admitted the justice of their case by doing away with the regulations in the recent war cases.

The British Legion has made many representations on their behalf but these representations have been rejected on the ground that there are real difficulties in sorting out at this late date the evidence which would be required to deal with these cases if the date bar was abolished. Neither I nor anyone else can say how many of these people may be affected. Although it has been proved in many other cases that widows are singularly tenacious of life, time must to a considerable extent have brought about its own remedy. I hope, however, that the Minister will consider the abolition of this bar and will try to do belated justice to women in poor circumstances whose husbands undoubtedly have died as the result of war disability.

There is another class of pensioner which causes considerable trouble to officials and voluntary workers in the British Legion. There is no doubt that the provision of National Insurance, however defective it may be in some respects, has helped to camouflage some of the harder cases, but this is not satisfactory from the point of view of ex-Service men. The British Legion finds that in many cases it is distasteful to men who have a legitimate claim on the country to have to make application for this form of help.

Many will not do so and prefer to carry on with their limited resources.

An official of the British Legion told me recently that in Belfast he had to deal with 20 cases of war disabled men who lived on a small estate. He found that 30 per cent. were heavily in debt and required financial assistance. Of course, it cannot be assumed that therefore 30 per cent. of all war pensioners are in the same sort of position, but from inquiries I have made, both in this country and in Northern Ireland, I have no doubt that there are a number of very sad cases which are worthy of special consideration. The increase in the basic rate would obviate a lot of the requests which have to be made for National Assistance, and while the country might have to pay out a little more on the one hand, the taxpayers might get it back on the other.

Yesterday, I heard the Minister of Pensions and National Insurance speaking outside this House and, if I heard him correctly, he said there were now 980 offices where war disabled people could obtain advice and assistance, compared with the 80 offices which existed under the old system. I hope that the Minister will make it clear to those very worthy but misguided people who think otherwise, that in these days there is nothing shameful in applying for National Assistance when it is necessary.

1.36 p.m.

The speech of the hon. Member for Belfast, East (Mr. McKibbin) conformed in one important respect to the general tone of this debate, in that he dealt entirely with symptoms rather than with causes. But he rendered a great service to the House and made an important contribution to the debate in calling attention to the plight of a class of people in receipt of fixed incomes, about whom very little is said. He referred to annuitants and people of that sort, and I endorse what he said.

The hon. Member for Southampton, Test (Dr. King), who has undoubtedly performed a great service by raising this question, threw his net very wide. He called attention to the hardships suffered by those living on pensions and other fixed incomes. Much has been said about the Service pensioners, still more about old-age pensioners and widows, and the hon. Member for Belfast, East brought in annuitants. At this stage I wish to declare my interest, because soon I might be one of the people whom my hon. Friend mentioned in his reference to people living on other fixed incomes.

I was never a business man. All my working life before I came to this House I was a salaried employee. But I was always a practitioner of the virtue of thrift. I made provision, even on the smallest of incomes, and that provision increased as I got older and my income increased. Samuel Smiles himself had nothing on me. I was very careful in handling my savings and my little investments—such as they were. I always avoided the kind of investment which anybody with any common sense at all could see would be bound to depreciate, as time went on, owing to the steady fall in the value of money.

Nevertheless, at the age of 64 it is with some little dismay that I contemplate the possibility that I might have to retire in the near future, because the income which I have provided for myself by the exercise of immense thrift and, if I may say so, of no inconsiderable soundness of judgment would have been ample for the needs of my wife and myself, but for the rise in the cost of living and the rise in prices which has taken place in recent years.

I thought that my hon. Friend the Member for Itchen (Mr. Morley) performed a notable service in this debate when he pointed out that it appeared as if we had to choose on the one hand between full employment and high prices, and on the other low prices with plenty of unemployment, the kind of thing which prevailed in the period before the war. That is precisely the dilemma of the capitalist system, to the destruction of which I consecrated my life 47 years ago this May. We are living in what is at least an 80 per cent. free capitalist economy. It is of the nature of a free capitalist economy that, if we are to have full employment, we must have high prices; and we can only have cheap living if we are content that great numbers of people shall be out of work.

The reason for that lies in the very basic characteristic of the capitalist system itself. The motive of free economy is profit. Profit depends upon prices. If we have something to sell, it is the seller who fixes prices in accordance with the conditions of competition or lack of it, scarcity or abundance, that are the background to the business. In fixing prices no capitalist is concerned merely to say, "I will get back what I have spent, plus a reasonable profit." That is not the criterion, and nobody knows it better than hon. Members opposite.

The criterion under capitalism is that the price of anything shall be what it will fetch. It is axiomatic that in a condition of full employment money is plentiful be cause employment is full. There is plenty of money about and prices tend to be high because prices are determined not by—

I am not quite sure to what the hon. Member is addressing himself, but it seems to me that he is speaking to his Amendment and not to the Motion. He cannot discuss his Amendment because that has not been selected.

With great respect, Mr. Deputy-Speaker, I was not speaking to the Amendment. I noticed that when you did me the honour to call me you did not call my Amendment. I am speaking to the Motion of my hon. Friend the Member for Test who calls attention to:

Moreover, there is another important factor in the high prices which are the cause of the hardship suffered by the pensioners, by the fixed income people, by the ex-Service men and the others. It stands to reason that if we are to have an economy in which the supply of money is steadily increased from year to year, then the dice are loaded in favour of an increase in prices. It is essentially true to say that the system of free enterprise under modern technological conditions cannot carry on, it would break down, unless there were a steady increase in the total quantity of money in circulation.

I do not intend to make the mistake of wearying the House with figures about the two kinds of money which circulate. If I write a cheque and I pay somebody else, that is one sort of money; and if I put my hand into my pocket for a coin or a note, that is another sort of money. These two kinds of money added together have been increasing ever since the Second World War. As a matter of fact, with only two small interruptions, the total amount of money has been increasing ever since the First World War. The first interruption was in 1922, when we had a slump of massive dimensions. The second interruption in the increase in the amount of money was in 1931, when again we had widespread unemployment. With the exception of those two interludes, the amount of money has been increasing constantly ever since the First World War. In the last seven years the amount of money circulating in the country has increased at the rate of £195 million per annum, 84 per cent. of which—£165 million—has been put into circulation by the banks, with no authority from anybody but themselves.

What is the use of coming to this House and talking about the hardships which old-age pensioners have in fact suffered since the enactment of the Beveridge principle in 1947, and talking about the hardship suffered by the recipients of war pensions, about the hardships that I should suffer if I lost my seat at the next election—which I shall not; what is the use of talking about all these hardships, all of which are due entirely to rising prices, when the conditions under which we run our country not only entail 80 per cent. free enterprise, but also involve a steady, constant addition to the amount of money circulating, of the order of 3 per cent. per annum?

It is very significant that the capitalist system can survive only so long as the amount of money in circulation is being constantly inflated. That is why the price of mutton is what it is, when in the 14th century one could buy a whole sheep for 4d.

I want to make certain suggestions which would really help the Government if they were willing to apply them, and there is no reason why they should not. I should like to make a suggestion whereby they really could arrest the increase in the cost of living. They could not arrest the increase by discontinuing this process of steadily inflating the amount of money—that is to say bank deposits plus currency. That is certain. The two occasions on which we have tried to do that since the First World War—1922 and 1931—prove that, if we try that move, we get ourselves landed in formidable depression and a slump of the first order.

Incidentally, and by the way, the post Second World War history of the United States proves the same thing. In 1949 they tried to arrest the increase in the volume of money, and they had four million unemployed. The same thing is happening now. It is no use—

This part of the hon. Gentleman's argument is clearly addressed to the Amendment.

Very well. It is no use my asking the Government to do that. I should like the Government to do some other things. I put it to you, Mr. Deputy-Speaker, that the duty of any Government, whichever party is on the benches opposite, is to try to remove the cause of these pensions and fixed incomes being inadequate, and especially is it the duty of the party opposite because many of the fixed income people are their supporters. They are the black-coated, respectable, middle-class people who live in the suburbs and vote Conservative, and whose wages do not go up and down by trade union agreement.

I should have thought that those on the Government Front Bench would have done what they could to preserve the purchasing power of money by putting a stop to these causes which lead to the hardships of people on fixed incomes. The obvious thing to do is to stop people charging too much for goods. There is a pretty good way of doing that. Why not put a stop to the practice of resale price maintenance? The shopkeepers have to conform in respect of many commodities to the—

The hon. Gentleman is now discussing the last item in his Amendment.

As a reasonable Member of Parliament, I want to put it to you, Mr. Deputy-Speaker, as a reasonable Deputy-Speaker, that it is quite impossible to debate a Motion of the kind moved by my hon. Friend the Member for Test which deals with an evil brought about by rising prices and which concludes by asking Her Majesty's Government to increase the value of money by preventing prices from rising without making suggestions. How can one speak to this Amendment without making suggestions—

The hon. Member cannot speak to the Amendment because the Amendment has not been selected. A reasonable Deputy-Speaker is bound not to select it.

I beg your pardon, Mr. Deputy-Speaker. How can one speak to that Motion without making suggestions whereby Her Majesty's Government can carry out the suggestion which my hon. Friend the Member for Test quite sensibly makes in the last three lines of his Motion?

As long as the hon. Member discusses them in general terms and not in the specific terms of his Amendment, which has not been selected, he will keep himself in order.

I am obliged. I shall be most scrupulously careful to keep myself in order on the general terms by saying that Her Majesty's Government should handle this business of the increasing quantity of money in such a way that it does not cause prices to rise, that Her Majesty's Government should handle the existence of a free economy in such a way that the practitioners of business shall not be permitted artificially to compel prices to rise. I think it is reasonable, therefore, that I should suggest very briefly that if they prevent manufacturers and wholesalers from imposing resale price maintenance on retailers, they will be doing a good job of work, and I shall say no more about that.

I suggest that if we must have new money—and, of course, we must increase the quantity of money as the population and productivity go up—they should bring it into existence as a subsidy to the consumers of the basic necessities of life. In that way, we shall not get inflationary effects, and I will say no more about that.

Every hon. Member who has spoken in this debate has made an important contribution to the subject under discussion, including my hon. Friend the Member for Test who raised the topic, and my hon. Friend the Member for Itchen who pointed out that the benefits of the Welfare State are taken away by rising prices and that we are, therefore, confronted with the dilemma either of full employment plus high prices or unemployment plus low prices.

The hon. Member for Lewisham, North (Sir A. Hudson) made a most useful contribution to the debate because he pointed out—and it needs to be said—that the party on this side of the House, rightly or wrongly—and I hope rightly—is committed to restoring the 1947 purchasing power of retirement pensions and other national insurance benefits. Unless the Labour Party is prepared to carry out that pledge, and knows how it is going to implement it, the Labour Party is doing something very wrong indeed. I have enough confidence in my leaders to believe that they have worked it all out and know just how they are going to do it.

You, Mr. Deputy-Speaker, have made possibly the greatest contribution of all to this debate, because you have pointed out how difficult it is for hon. Members, no matter to which party they belong, to point to the real cause of these troubles, namely the capitalist financial system which appears to be away up, above and beyond criticism from hon. Members on the back benches.

1.54 p.m.

Traditionally, this is a back benchers' day and, therefore, I can assure my hon. Friends that I intend to intervene in the debate only very briefly. I must apologise to my hon. Friend the Member for Nottingham, South (Mr. Norman Smith) for not following him into the realms of high finance.

We are this afternoon discussing a subject which is not new. It has been raised at Question time lately. We have heard the Minister of Food, the Minister of Pensions and National Insurance, and, occasionally, the Chancellor of the Exchequer defending the rising prices of essential foods in this country, and refuting the suggestion that those on fixed incomes are enduring a hardship which is quite uncalled for today.

When these Ministers are under fire they generally try to defend themselves with that very fragile shield, the Interim Index of Retail Prices. I presume that they convince themselves that all is well, but I think that my hon. Friends will agree that in the last few months we have never been convinced that there is not hardship involved in having to live on those very low fixed incomes.

On a Friday we can discuss these matters in a calmer atmosphere, and I hope that this time reason and compassion will prevail. I should congratulate my hon. Friends the Members for Southampton, Test (Dr. King) and Itchen (Mr. Morley). I was impressed by their moderate language and by the detailed consideration which they had given to the whole question. I do not think it is disputed that if food subsidies are removed from certain basic foods, the prices will go up, and I think that in the light of what has happened—the agitation on this score, the industrial unrest and the demands for increased wages—had the Chancellor of the Exchequer foreseen all this he might have modified his policy.

Indeed, after one year of the present Government's policy, "The Times Annual Financial and Commercial Review," which I understand is greatly respected by businessmen, statisticians and economists, said: are suffering. When this is stated from these benches week after week, Ministers always refute it.

I want to submit the latest evidence. We all appreciate the sympathy of the hon. Member for Lewisham, North in these matters and the fact that he is prepared to give his Friday up to a debate of this nature. I fear that he glossed over that report of 13th March—the very latest evidence that I want to bring to the notice of the Parliamentary Secretary—of a survey carried out by 11 North Oxfordshire villages of those people over 65 years of age who live alone.

The report is made by Dr. G. Scott, the Chairman of the Oxfordshire Association for the Care of Old People. I might say that I do not know Dr. Scott personally. I do not think he has any political affiliation with the party to which we on this side of the House belong, and I claim to know most of the doctors in this country who sympathise with our way of thinking. Therefore, I do not think that this doctor is biased.

This report was made last week. I have no intention of omitting anything that he said which hon. Members opposite may feel supports the Government. According to "The Times" he said:

Dr. Scott paid

I think the hon. Gentleman perhaps sought to minimise what my hon. Friend was saying, but Dr. Scott also said that there were also numbers of old-age pensioners who are still not applying for National Assistance.

What are his recommendations? After this survey, which was not confined to a small area of Oxfordshire, he said:

When I read this, I was mindful of the fact that, on occasions, I have asked the Parliamentary Secretary to the Ministry of Food what he proposed to do about the diminishing consumption of milk in this country, and I was rather shocked, recalling his previous attempts to extol the importance of milk for young and old, when he said to me, about ten days ago, that people are not drinking milk because there is an alternative. It does not seem to me that Dr. Scott, in this report, has suggested that there is any alternative to milk for the old-age pensioner.

On this question of alternatives, which my hon. Friends have raised week after week concerning the failure to take up rations, we are always met with the retort that the reason why people are not taking up their rations is because there are alternatives. I would remind the House of the answer given to me on 24th February, when I was almost sorry for the Minister of Food, who found himself in an embarrassing position. My hon. Friend the Member for West Ham, North (Mr. Lewis) asked him why millions of rations of bacon, butter, margarine, cooking fat and cheese were not taken up, and the Minister of Food replied:

Then, of course, the Minister rather feebly rests his case on the index, and Ministers have used the index as a yardstick, although I think they know perfectly well that it is far from perfect. If it is so perfect, why, then, has the Minister of Labour asked 20,000 households to record their family budgets? This happened only last year. If this yardstick, about which we are told every week, has not failed, or if they felt that it need not be questioned, why have 20,000 households to record their family budgets, and why are these budgets being examined by experts with a view to presenting an index which will be more truly representative of modern family spending?

Ministers have no right to be dogmatic on this subject until they can apply a genuine test. It was last week, I think, that a Member of the Government admitted that the prices of food had gone up, though the hon. Lady said that it was the fault of the housewife for failing to extract extra housekeeping money from her husband subsequent to the reduction in the Income Tax last year. Really, this is a very frivolous approach to the matter. I understand that it is seriously contended by right hon. Gentlemen opposite that the increase in the food prices were offset by tax reductions, and I would therefore ask the Parliamentary Secretary whether he will tell us what tax alleviation the old-age pensioner secured.

Would the right hon. Lady develop the subject of the increased cost of fuel, because it is very important? People are told, whether they believe it or not, that the increased prices of fuel are due to nationalisation.

The hon. Lady and I agree about equal pay, but I do not think we shall ever agree about nationalisation. If she had been present earlier, she would have heard one of her hon. Friends complaining that the price of coal was about £7 per ton, while others of her hon. Friends have pleaded for fuel to be supplied more cheaply to old-age pensioners or to be made available to them in some other way.

I now want to say a word or two on the expectation of life. It is now a favourite arithmetical exercise of the economists and statisticians to calculate for years ahead the increasing proportion of old-age pensioners to workers, and who make the most gloomy prognostications. The fact that the expectation of life is increasing should be a matter for rejoicing. We should be proud that science has made this possible, and should so arrange the economy of the country to take account of it. Old age, with its associated loneliness and feebleness, is surely hard enough to bear without the knowledge that the increasing years impose a financial burden on the community.

Although one of my hon. Friends hopes to be able to develop this point, I should like to say that it is to the great credit of many people that the lives of the aged have been improved immeasurably in the last few years by the provision of clubs, hospitals, meals on wheels, and so on, but none of these things can replace the extra financial help of which many people are urgently in need. That is the responsibility of the Chancellor of the Exchequer, and I suggest that his duty is clear.

There are two weeks before he makes his Budget statement, and I should like to say to him that the first charge on the Revenue of the country in the forthcoming Budget must be to give the old-age pensioners and all those who live on fixed pensions and benefits administered by the Ministry of Pensions and National Insurance an increase which will make the purchasing power of their pensions equivalent to that which they enjoyed in 1946.

That is quite clear, and I do not think the Parliamentary Secretary can go away under any misapprehension as to our attitude. We ask that the purchasing power of these people should be made equivalent to the purchasing power of their pensions in 1946, and I would add that the Chancellor should allow nothing to take precedence over this, for these are the people who are in the greatest need.

2.10 p.m.

I had better explain my presence at this Box. I remember that on 3rd March the Economic Secretary to the Treasury explained that he was replying to the debate because the Chancellor of the Exchequer had gone behind purdah. Now we are within a fortnight of the Budget, and both the Economic Secretary and the Financial Secretary to the Treasury have retired behind that screen. I am left alone to explain the position until the Budget comes.

Today's debate is, indeed, a continuation of the debate of 3rd March. We then talked in broad terms of productivity and the economic situation. Today's speeches have brought the matter right down to the homes of the people, and to the effects of productivity on the homes and our economic situation. I congratulate the hon. Member for Southampton, Test (Dr. King) on his good fortune in the Ballot, on his choice of subject and, principally, on the way in which he presented his case. His speech was cogent, clear and not unduly contentious.

Indeed, there has been little contention in the debate, except possibly a little from the right hon. Lady the Member for Fulham, West (Dr. Summerskill), but it is expected of her. I sympathise with her, because I know that she is in training for some verbal fisticuffs at the next Election, and she has got to do it. On a Friday afternoon we forgive her anything in that direction. I listened to all the speeches both from behind me and from the opposite benches, and they were for the most part non-party and co-operative, such as those from my hon. Friend the Member for Morecambe and Lonsdale (Sir I. Fraser) and my hon. Friend the Member for Lewisham, North (Sir A. Hudson).

The Motion does not merely deal with one particular class of pensioner but with the broad problem of people who are living on small, fixed incomes from whatever source. It is valuable that the House should express an opinion on that problem, recognising that the standard of living of those people is intimately dependent upon the productivity of this nation. If wages or dividends are increased beyond the amount of extra production in a nation, those who are living on small, fixed incomes will have the disadvantage and will suffer. It is essential that we should all make that fact abundantly clear at the present day.

I go further and say that if, when there is increased productivity, the whole of the increase is absorbed in wages and dividends, everybody living on a small fixed income or pension will be at a disadvantage as compared with the producers. We have to remember that pensioners are past producers, who helped to increase our production. They saved, in the hope and expectation that their savings would be sufficient for them in the days to come, but two world wars have shattered those illusions. Their savings can no longer fulfil the purpose for which they were designed. Therefore, the Government, Her Majesty's Opposition, organised employers and organised labour have a duty to discharge to the people who live on small fixed incomes, and the best way to discharge it is to see that money keeps its full value.

We recognised that, before the last General Election in our policy document. Let me remind the House of what "Britain Strong and Free" said on this subject:

I have talked on the subject of those living on small fixed incomes, but speeches have been made on the problem of the war pensioner, especially by my hon. Friend the Member for Morecambe and Lonsdale, my hon. Friend the Member for Belfast, East (Mr. McKibbin), and the hon. Member for Brierley Hill (Mr. Simmons) to whose contribution I listened with interest and with a very great deal of agreement. It is the view of Her Majesty's Government, and I am sure of the whole House, that the country owes a special obligation to these pensioners and their dependants to secure them from the hardships imposed by the loss of purchasing power of their pensions.

We can be justly proud of the valuable work that has been done in recent years in welfare, rehabilitation and finding jobs for the war disabled. We gave a specific pledge at the last Election that the hardest needs would be met first, and it was in fulfilment of that pledge that in 1952, at a time of financial stringency, we made the greatest increase in the basic rate that has ever been made in the history of war pensions. Together with increases in allowances it amounted to more than £10 million a year. We are far from complacent about the position.

On that score, and not so much in view of anything which has been said in the debate but in view of some of the correspondence that has appeared in newspapers and of some speeches that have been made, I want to emphasise that the 55s. for 100 per cent. disablement is not a rate of pension on which anyone is expected to live. The single man totally disabled, and unemployable because of his war disablement, receives the basic pension of 55s. plus unemploy-ability supplement of 35s., making an income of 90s. If he is so badly disabled as to need constant attendance he can get as much as £3 per week, making £7 10s. per week for a single man and £8 l1s. 6d. for a married man without children. The severely disabled man who is unable to find any employment must excite our greatest sympathy as the man who is suffering unequalled hardship, as distinguished from the man who is in work, and has a compensatory benefit as his wages rise.

All these matters are under continuous review. The best I can do today is to repeat the pledge that was given by my hon. and gallant Friend the Joint Parliamentary Secretary, in the debate on 8th February, which, I believe, was initiated by the hon. Member for Test. He said:

In the last two Budgets, my right hon. Friend the Chancellor of the Exchequer has directed his policy towards helping those in the small fixed-income group, so far as he can, by increasing the personal allowance and by dealing with the age relief grants so that those who now have total incomes of not more than £600 count the whole of their investment income as eligible for the earned-income relief of two-ninths.

My right hon. Friend also introduced a special relief for those living on small fixed incomes whether under the age of 65 or not, and where their total income does not exceed £250 a year they also receive the benefit of the two-ninths income relief. That, of course, helps those who pay tax.

As has been said by one hon. Member in this debate, we also have to consider the problem of those who are below the Income Tax level. In her remarks, the hon. Lady the Member for Fulham, West referred to the cost-of-living position and said that she expected that I would refer to the index. Surely, we should not say anything that might make people doubt the validity of the cost-of-living index. I thought that some of her remarks might have the effect of spreading such a doubt, and I think that is very unfortunate.

The hon. Gentleman must not be so self-righteous in this matter. He must remember that the Minister of Labour himself has cast a doubt on the cost-of-living index, and that he is now examining certain budgets with a view to presenting another index. The hon. Gentleman must not be so priggish.

The hon. Lady is not priggish so much as ignorant of how the cost-of-living index works. It was originated by her own Government, and the advisory committee on that matter is in constant session. Every month prices are examined in order that the accuracy of the index may be maintained. I thought that we were all proud of the fact that the advisory committee is not a party committee. On it are representatives of the workers and representatives of the employers. Also on it are statisticians, who are constantly examining the position with a view to bringing the index up to date.

The index shows that whereas in the 20 months from February, 1950, to October, 1951, the all-items index had risen by 13 per cent, and the food items by 18 per cent., in the last 20 months the rise has been 1½ per cent. on the all-items index and just below 2 per cent. on the food index. That, I should have thought, was a matter for considerable congratulation among all parties, and especially among those who are anxious to see steadied the living costs of those on small fixed incomes. Our policy is directed to securing that the rise in the cost of living should be checked and that pries should eventually be brought down.

I see that the right hon. Member for South Shields (Mr. Ede) is present. I well remember taking part in a similar debate to this in 1950, when the right hon. Gentleman was the Home Secretary and he told us:

Without entering into the question of the accuracy or otherwise of the cost-of-living index, I would point out to the hon. Gentleman that the Ministry are now entering the stage of the quinquennial review.

Will he convey to his right hon. Friend a suggestion to which he might give consideration—because it is one of great importance—which is that, accepting that the general cost-of-living index is of correct validity for the whole of the country, it is not valid for the old-age pensioners and people living on fixed incomes because it does not truly reflect the increase in the cost of living within the narrow confines in which those people have to live?

I suggest that the National Advisory Committee or some other body might look at the problem. It is one which ought to be examined, because there is a genuine feeling that the cost-of-living index is not a true reflection of increased prices so far as old-age pensioners are concerned.

I think it is absolutely clear that the cost-of-living index gives the average position. It is based on a weightage of, broadly speaking, 40 per cent. on food. Although the hon. Member for Ince (Mr. T. Brown) explained to us today how one section of the community spends a good deal less than that percentage on food, he said that old-age pensioners spend as much as 70 per cent. of their income on food.

I apologise to the hon. Gentleman for intervening, but he did, without giving notice, refer to something which I said. I would point out to him that that speech was delivered on 7th November, 1950, at a time when we were just beginning to feel the impact of the war in Korea and when prices throughout the world were rising. He will see that my reference to the inability to prevent prices rising and to prevent an increase in the cost of living was related to world conditions. The position was, of course, that we actually prevented the full impact of the rise in world prices falling upon the people of this country, whereas now, when world prices are falling, the best that this Government can say is that prices here have not risen.

That is a very interesting explanation. I was not making any party capital out of the right hon. Gentleman's speech, but was merely explaining the difference between 1951 and today. I would mention that in that same speech the right hon. Gentleman went on to say:

"We recognise that it is impossible in this world, divided as it is at present, to anticipate that there will be any reduction in the cost of living."—[OFFICIAL REPORT, 7th November, 1950; Vol. 480, c. 820.]

Prices have become so stable that for the last year the cost-of-living index has not moved, which is a matter for congratulation.

Except that at the present time world prices are falling.

It would appear that since he left the Home Office the right hon. Gentleman has not been observing what has been happening in world food prices. Had he read "The Times" two days ago, he would have seen that the wholesale prices of food have risen successively in the United States during the last six months, and had he listened to the debate on 3rd March he would have heard my hon. Friend the Economic Secretary explain the level of food prices in most of the countries of Europe. He said that some had gone up, and others had gone down.

It is not true to say that prices generally are falling all the world over. What we can say is that we have moved away from a period of great inflation, for whatever cause. We believe that to be due to the official policy of my right hon. Friend the Chancellor of the Exchequer, but it being a Friday afternoon, I will allow the right hon. Gentleman to make any other suggestion for it. We have moved from a period of high inflation to one of price stability, and that is of great importance for those of whom we are thinking in this debate.

That brings me to the beginning of the Motion, the first part of which states: delivered at Ayr on 16th May, 1947. He said:

I am sorry to disappoint the hon. Gentleman. I might say that the explanation was that great minds think alike. I did not take it from the Prime Minister's speech. Both of us took it from "Some Fifty Years of Socialist Teaching."

The words were so strangely alike that I thought the inspiration was from the same source.

It was because we believed that, that when we came into power in 1952 one of the earliest steps which we took was to ask the National Assistance Board to consider the level of National Assistance allowances, and we accepted their recommendation. So, in June, 1952, the National Assistance allowances were raised to a level of 35s. plus rent for a single person and 59s. plus rent for a married couple. This is the most generous rate of National Assistance that has ever been given in this country. I want that to be recognised by the whole House.

If we compare these scales with the 1946 scales and weight the latter upwards to give effect to the subsequent changes in purchasing power, we find that the present scales show, for a single person, an advantage of 7s. a week, and for a married person an advantage of 10s. a week over the 1946 scales. That is a very important factor.

The 1946 scales of assistance were under the old assistance Acts. The new assistance rates under the new Act did not come into operation until after 1948. The insurance benefits became operative in 1946 and the new Act applied to old age pensioners the assistance which was given under the old Act. We brought in the new assistance in 1948. It was not only that the scales were changed, but we also substantially changed the disregard.

The comparison is with 1946. I can give the 1948 ones later, but I think it is important to establish that fact. This Motion goes on, quite rightly, to state that there has been a large increase in the number of people going on to National Assistance since National Assistance started. It is true that there has been an increase of 750,000 from 1948 to the end of last year. If we analyse that figure of 750,000, we find that a 450,000 increase occurred in the years of inflation 1949, 1950 and 1951. That leaves a figure of 300,000.

We find that in the year 1952, when the scales were put up much more generously than they had been in the past an extra 200,000 came on to National Assistance. In fact, the increase last year was only 95,000, which was a lower rate of increase than in any year since 1948. Those are the facts which I want the House to recognise, because I do not think when they have been observed that hon. Members will be quite so concerned about the increase in the general total of those on National Assistance.

What I think is of considerable concern is that an increasing proportion of those on retirement pension have to have recourse to National Assistance for supplementation of their pensions. I think that the truest figure I can give is best expressed in terms of the household. The number of retirement pension households which had to have recourse to National Assistance at the end of last year were 21·9 per cent. That was an increase of 3 per cent. over the previous year, which shows a considerable increase.

Why is there that increase of those in receipt of retirement pension going on to National Assistance? First, I think that we must remember, as the right hon. Member for Fulham, West pointed out, that we are becoming an ageing population. We have 500,000 more in the age groups of what I call the pension age than there were five years ago. In addition, whereas the retirement pension has been adjusted to the July, 1948, level of purchasing power, the National Assistance scales have been adjusted to the 1946 level of purchasing power.

The Government fully realise that factors stressed in the intervention of the right hon. Member for Llanelly (Mr. J. Griffiths) must undoubtedly have had some effect, and that the effect would be to make it more likely now that more of those on retirement pensions would have to supplement their pensions with National Assistance than in 1946. The fact which, I am afraid, we have to realise is that the period of inflation in the years 1949 to 1951 depleted a great amount of the savings of these older pensioners.

That, I think, is particularly true of the older section in this group. I have not the figures later than 1952 with which to illustrate this argument, because the later figures are not yet available, but to me it is depressing to find that in November, 1952, one-fifth of the old people on assistance were over 80 years of age and in fact three-quarters of them were over 70. When we realise that the pension ages about which I am talking are 60 for women and 65 for men, that gives figures which make one appreciate that it was the period of inflation which brought many of these people, very reluctantly and unwillingly, to National Assistance.

The other factor that we must take into consideration—it is a very important one—is that the number of pensioners at present receiving incremented pensions is only a very small element of the total, but the position will slowly change. In the September quarter last year more than 11 per cent, of the men awarded retirement pensions, and more than 7 per cent, of the women, were awarded pensions which had been incremented with the full 10 increments. In the case of men nearly 30 per cent, of the total, and in the case of women more than 20 per cent., were awarded pensions incremented with more than four increments. That tendency will, happily, grow. It is a slow process, but it means that there will be married men with their wives getting pensions up to the full total of 79s. per week, and single men and single women getting pensions of 47s. 6d. per week.

The right hon. Lady the Member for Fulham, West and my hon. Friend the Member for Lewisham, North drew attention to the Oxford Survey. I must admit that I have read only the Press reports of the survey, and have not yet read the survey in detail. However, I am informed by those who have read the survey in full that it does not present quite the picture which was depicted by the right hon. Lady. She talked about the survey advocating a system of free or cheap coal.

I am told that that is not quite what the survey recommended. It merely said that it was thought that the coal ration for persons over 70 should be increased. It also said that nearly all the persons who were examined drank milk in considerable quantity, but it did not say that it would be a good idea to have a system of free milk. What the survey was actually pointing out, as was stated by my hon. Friend the Member for Lewisham, North, was that to those who have examined the condition of old people loneliness is one of the most worrying factors.

May I interrupt the hon. Gentleman?

Might I just finish this? When I have presented the case, the right hon. Lady can interrupt.

It is on the point about my not having correctly represented the survey. I read verbatim from the report. I have now sent the verbatim report to the OFFICIAL REPORT reporters.

The question is whether one is reading from the report itself or from a report of the report. I admit that I have not read the survey. I am quoting from those who have read the report and from my memory of what I read in newspaper reports.

I quoted the survey verbatim, so my information is probably better than that of the hon. Gentleman.

That may be. We will see when we read it. The survey found only seven cases of people who needed assistance and had not got it. Of those, four persons actually had resources which would have enabled them to continue without assistance for some time, although those resources came into the disregards. Therefore, I do not think any of us need be very perturbed about the Oxford Survey. What we are undoubtedly concerned about—

It is all very well for the hon. Gentleman to say that we need not be perturbed about the survey. Had he not better read it first?

I have now been handed a report of the report. If I hand it to the right hon. Lady, perhaps she will point out where it is suggested that the old-age pensioners should have free coal and free milk.

The Joint Parliamentary Secretary has just passed me the "Oxford Times." I was quoting from "The Times" of London, which we all recognise as a fairly responsible newspaper.

On a point of order. Might I ask for your help, Mr. Speaker? Would you be good enough to tell the Joint Parliamentary Secretary and my right hon. Friend the Member for Fulham, West (Dr. Summerskill) that they can do their reading in their own time, and thus enable us to get on with the debate?

I apologise to the House for having made such a long intervention.

We are now getting to the period of the review. This is the year when we shall be reviewing the position of all those who come under the National Insurance Scheme. Within a fortnight, the Government Actuary will start his review of the finances of the scheme. It is hoped that the report of the Government Actuary will be available before the end of this year.

Meanwhile, my right hon. Friend has already begun his review of the working of the National Insurance scheme. In reply to a Question put to him by the right hon. Lady yesterday, he explained how he had begun the review and how he had referred many questions to the National Insurance Advisory Committee, and he mentioned the three latest questions which he has referred to it. His final duty will be to review the rates of benefit, which he will do immediately he receives the report of the Government Actuary. My right hon. Friend wants to make it absolutely clear that he fully recognises his obligations, and he gives the House the assurance that he intends to carry them out without delay.

My advice from the Government Front Bench is that the Motion is one which the House should accept. It is carrying out the principles on which my party, and, I believe, the Labour Party is based. With the stimulus that it gives us at the end, it is one which the Government recognise and intend to carry out. It is indeed our aim that, should the finances and the economics of the country permit, the level of benefits and pensions should be restored without delay to the level which they had when the National Insurance Scheme was introduced.

2.49 p.m.

I envy the hon. Member for Southampton, Test (Dr. King) his good fortune in the Ballot. The whole House has appreciated the opportunity he has given to discuss these very important, very human and very urgent problems. I am extremely glad that the Joint Parliamentary Secretary has ended his remarks in the terms which he used. I feel that in such circumstances we shall be able to make real progress in dealing adequately with the problems which the Motion poses.

The first point that I want to make relates to what was said by my hon. Friend the Member for Morecambe and Lonsdale (Sir I. Fraser) and others about the war disabled and their dependants. This is a very difficult problem indeed. I consider it to be absolutely urgent and vital that no disabled man or his widow should in any circumstances whatever require to have recourse to National Assistance. Whatever is done by a grateful country for these men and their dependants should be done straightforwardly, and no one should have to go to the National Assistance Board to supplement to the scale which is the accepted minimum scale for all sections of the community. I do not want to go through all these, but I can quite see certain problems involved in carrying out that policy, which I think should be carried out, but I hope the Government will take steps to see that action is taken at any rate to meet these minimum demands.

The next point I want to make is that it seems to me that the people covered by the terms of the Motion really fall into three categories. They are the old-age pensioners without resources who go to the National Assistance Board for supplementation; secondly, those who are living either on small pensions from the State or from a private employer, or on small annuities or possibly on small investment incomes, incomes so small that they do not pay Income Tax but whose resources are such that they do not get additional supplementation from the National Assistance Board; and thirdly, there is the small income group which has a tiny income but which still remains liable to Income Tax.

If I may deal with the last section of the community first, I would say this to the Chancellor of the Exchequer. Even if all the Treasury Ministers are in purdah, perhaps the Parliamentary Secretary to the Ministry of Pensions will be able to convey to the Chancellor my view, which I am sure will be shared by all other Members of the House, that in the Budget he should carry on with the concessions that he made last year, and which have been referred to by the Parliamentary Secretary, and ought to free from Income Tax liability all those of the age of 65 or the earlier year of 60 if it is considered desirable, who are single people and whose incomes do not reach a level of over £250 per annum, and in respect of married couples people whose incomes do not rise above £400 per annum.

If this were done it would be a real stimulus to saving, and it would also deal with a section of the community which provided for their old age in a pre-war world, but which has now got to live in a post-war world on a pre-war income. I think it is urgent that something should be done to help these folk, because not only have they got all these difficulties to contend with in the circumstances of life today, but they are really too old to get any benefit from the improved standard of life which has emerged in the post-war world.

There is an obligation on us to see that something is done to help them in the very difficult circumstances in which they find themselves. I would not say anything more about that section of the community at the moment, but I hope that the Chancellor of the Exchequer will see his way to give them some help. I was very glad to hear the terms in which the Parliamentary Secretary spoke of their contribution to the development of the country as a whole.

The second category is a very difficult category to deal with because it is not subject to any Income Tax liability, neither can it be helped by the National Assistance Board. I want to put this as a general argument. Those who live in any of the three categories to which I have referred have to pay additional sums of money for some of the essentials of life. If they buy coal and they have a small limited income, it has to be bought in small quantities. Therefore, they pay more for those small quantities than if they are able to order it up to the full amount of the ration.

Every year when I hear the Minister of Fuel and Power begging people to lay in stocks during the summer months, I feel very sorry for those people who cannot find the necessary money to stock up, and, indeed, in many instances they have not got the facilities for stocking. With the development of flats it often adds to the complications.

Not only has an increased price to be paid for coal, but if they get their gas or electricity through the meter system they pay more for it than if they had a quarterly or half-yearly account. The gas and electricity boards are always informing us that if the meter system were abolished and quarterly accounts substituted there would be financial benefit to the individual as a result. What it amounts to is that the old-age pensioner and the people living on small incomes who have to find a shilling for the slot for their gas and electricity are being charged more than people who have larger incomes and can afford to have quarterly accounts. That is an aspect of the situation which ought to be taken into account.

When in a supplementary question I raised this question of coal with the Minister of Fuel and Power, he promised he would look into it. I got a little encouragement from that, but when the answer came it was to the effect that there was nothing he could do about people who bought in small quantities because the difficulty arose out of the variety of merchants and all the administrative difficulties about which we hear so much when we are dealing with these important problems.

I can see some difficulty arising on this matter of coal, because of the merchant organisation. It is probably quite a difficult matter, but I think something might be done about gas and electricity. There is no doubt in my opinion—and I am sure it is reinforced by everybody who has made a contribution to this debate today—that the greatest problem of the small income groups is adequate heating and also, I might add, adequate clothing. It is not easy to buy warm clothing on a small income, and that is another aspect of this whole problem. I think something might be done about the price of gas and electricity. I also hope that something can be done about providing milk on a cheap basis for these sections of the community.

That brings me back to saying something about the second category of people above the National Assistance level who are not liable to Income Tax. The only way beyond the points which I have made whereby these people can be helped is perhaps through suitable and adequate housing. I was very glad to see the other day a letter in "The Times"—as everybody has quoted "The Times" today I do not see why I should not follow suit—signed by Mr. P. Gilchrist Thompson, who lives at Shipbourne, near Tonbridge in Kent. He described a most interesting scheme which might be considered over a wide field by local authorities. Mr. Thompson wrote: much to examine the problems of the small income groups, to look at this aspect of the situation to see whether we cannot do more to provide houses for these people. It would eliminate the loneliness which is such a feature of the life of this section of the community, and it would enable the social services under the aegis of the various local authorities to look after the interests of these old people more easily.

My own local authority, the county borough of Tynemouth, has built two attractive hostels in the centre of a developing housing estate in order to give a community life to these old people. It has been a great success and two Ministers have expressed the greatest approval and appreciation of the scheme, which has also proved that the administrative costs are low compared with finding Part III accommodation. I was glad when my hon. Friend the Member for Lewisham, North (Sir A. Hudson) referred to the possibility of setting up a special committee charged with the responsibility of looking after old people and I urge that on the Joint Parliamentary Secretary for consideration.

Now one word about the final group of old-age pensioners. My hon. Friend has made it plain that this Conservative Government, after the quinquennial review of the National Insurance Fund, intend to meet their obligations. In the meantime, however, all sorts of problems are arising which need to be considered. For instance, it is time that all old-age pensioners ceased to pay prescription charges, irrespective of whether they draw National Assistance or not.

I believe that it was the hon. Member for Southampton, Itchen (Mr. Morley) who suggested that all of us would put the needs of the elderly as a first priority in the Budget. Every single man and woman who pays Income Tax receives £10 tax relief on stamps paid in respect of National Insurance contributions. That costs the Treasury something like £34 million per annum, a considerable sum. If the working community, and that includes all of us, are really interested in having some additional money made available to increase the National Assistance scale or to help these elderly people in some way I see no reason why the House should not press the Chancellor to withdraw that Income Tax concession from those who are earning money and place that sum at the disposal of the appropriate Government Departments for the use of these small income groups.

We should be making a very real contribution towards solving the difficulties of old-age pensioners if that were done, without additional cost to the Treasury. If the £34 million allowance were withdrawn, the people who are not paying Income Tax because their incomes fall below the tax level would not be penalised, and I am sure that the people who pay tax would not mind if this additional benefit went to that section of the community which is least fitted to face the problems of modern life. I make that suggestion to the Joint Parliamentary Secretary.

The Joint Parliamentary Secretary rightly said that it is of equal importance to the small income groups as to anyone else that we should have economic and financial stability in this country. I emphasise that if the financial position of the nation is insecure, disaster falls more heavily on the smaller income groups than it does on those who have more money to meet the blow. I would remind the House that when our financial position became extremely rocky in 1949 and the late Sir Stafford Cripps was forced to devalue the £, he was forced to put up the cost of living not only for those who could take the burden but for every section of the community. That made a very real difference to the unfortunate position of those who were living on small incomes generally and to old-age pensioners. In order to economise he did not come forward with a straightforward plan to cut the food subsidies. He put on a ceiling which he subsequently lowered but which had exactly the same effect as the cut made in the food subsidies in 1952 by the present Chancellor.

When I intervened in the speech of the right hon. Lady the Member for Fulham, West (Dr. Summerskill) with regard to the increased cost of coal, I thought that I heard an hon. Member opposite ask whether I wanted cheap miners. I do not. I come from a mining area and I think that we as a nation had our coal too cheaply in the old days. Neither do I want cheap agricultural workers. They are also entitled to a fair wage, in the same way as the farmer is entitled to a fair reward for his efforts. It is no good trying to use the political argument of food and ignoring the political argument of coal. That is the mistake which hon. Members opposite made in these debates. They always talk about the cost of food but forget to put forward the cost of heating by coal, electricity, gas and so on, which is a very important matter.

Scrutiny of the last available cost of living index shows that, apart from food, the cost of fuel, lighting and transport—which are all nationalized—have continued to rise, whereas items like clothing, household durables and so on have gone down in price. A great deal has been said about the methods of running our economy under the Conservative Government. When we are discussing the problem of the cost of living, it is very important to bear in mind that free enterprise has produced reductions, whereas the prices of things provided by the nationalised industries have continued to rise. [HON. MEMBERS: "No."] Indeed, that is so. I am coming to the end of my speech and I know that hon. Members opposite do not like it, but it is just as well to bear that in mind, because it happens to be true. [HON. MEMBERS: "No."] I think it very important that this should be on record.

I was delighted to find that, in answer to a supplementary question asked by the hon. Member who was Financial Secretary to the Treasury under the Labour Government, the Minister of National Insurance said on 8th March, 1954:

3.14 p.m.

I wish to support the Motion moved by my hon. Friend the Member for Southampton, Test (Dr. King). I should like to add my tribute to him for the admirable speech he made on behalf of old people and those with fixed incomes.

I honestly believe that this section of the community is having a harder struggle to live than it has had for the past 20 years. I well remember the scales of benefit of the old-age pensioner before the war. They were 10s. a week. In my county, Durham, most of them had to seek Public Assistance. I was a member of the county Public Assistance committee and in those days before the war we allowed 30s. 9d. a week for a couple on Public Assistance with a 5s. addition for rent.

This scale operated from 1934 onwards until the war years. If we compare that rate of benefit with the rate of National Assistance today, which, I admit, is higher than the old-age pension, and if we take into account pre-war prices, we find that old-age pensioners of 20 years ago were better off under that old, hated Poor Law system. The scale of 30s. 9d. before the war was better than the 59s. at present received by a person under National Assistance.

If we compare the present wage rates we get a much gloomier picture, because, relatively speaking, the position of old-age pensioners has worsened considerably. Before the war the average wage rate was £2 4s. and now it is £7 5s., so that wage rates have advanced by about 300 per cent. On the other hand, comparing present day figures with the old Poor Law system, which catered for nearly all the old-age pensioners before the war, we find that their subsistence allowance has increased by only about 100 per cent.

I feel that the old-age pensioners and people with small fixed incomes have been forgotten by the present Government, and that the day will surely come when those people will remember how this Government have let them down. I was a member of the Labour Party during the Labour Government of 1951. I admit that prices rose considerably in the last 12 months of that Administration, but I believe that most people appreciated that that was due to the tremendous jump in prices consequent upon the Korean war. Most people accepted that no one Government could control world prices, and to that extent the Labour Government were not to blame for those rising prices.

Today, those conditions do not apply. They have not applied since the end of 1951, because world prices have been falling since then. I am convinced that if the present Government had passed on the benefits of lower world prices there would have been a reduction in the cost of living and no need for the wage demands of the past two years. Furthermore, it would have kept down the cost of living and the people in the lower income groups would be enjoying a higher standard of living, instead of being condemned to the dire poverty which they are now enduring.

I believe that the Government have made the position much worse by the reduction of food subsidies and the abolition of price control. People did not expect them to do that. There were prominent Tory speakers who, before the Election, gave pledges that they would not touch the food subsidies. The same speakers did say, however, that they would reduce the cost of living, and there is no doubt that many people supported the Tory Party because of those specific pledges.

We on this side of the House know that the present Government were pledged to take certain steps to reduce the cost of living. I remember right hon. Gentlemen opposite saying that they would reduce the crippling burden of taxation, that they would take away bulk buying, dispense with an enormous number of civil servants and put them back into productive industry, and in that way prices would be reduced. The Government have been in power for two-and-a-half years, but we have not had the desired result. Prices are higher than they were before the General Election. To say the least, the Government ought to feel ashamed that they mislead the electorate, especially the old-age pensioners, at the last Election.

To some extent, trade unionists have been able to offset the rise in prices brought about by the policy of the Government. They have the ability to get higher wages, but the pensioners have no possible chance to increase their benefits unless there is a favourable response by the Government to their appeals. They have been the innocent victims of Tory broken pledges. They will remember that their position has been considerably worsened by the action of the Government.

I wish to make a few comments about the cost-of-living index figures which the Parliamentary Secretary mentioned. The argument is put forward that prices have not risen to an appreciable extent during the past 18 months. We can all agree that over a period of many years up to 1947 the index figures were completely out of date. In 1947 the Labour Government introduced the new Index of Retail Prices. This worked reasonably well because at the same time the Labour Government maintained control over prices, in addition to food subsidies and the rationing of commodities.

This position was maintained in an endeavour to keep fair shares for all, and it worked fairly well; but with the advent of the present Government the situation changed completely and there has been a free-for-all policy. Prices have been decontrolled, food subsidies reduced, and so on. Up to two-and-a-half years ago a responsible trade union official could quote the cost of living figures when submitting a wage application. Such figures could be quoted to justify an application for an increase. Of course, there are other factors such as productivity, but, in the main, it is the cost of living which justifies an application.

If we take the Ministry of Labour figures from September, 1952, to the present, we find that the cost of living has gone up by four points. When the worker or the old-age pensioner tells his wife that the cost of living has not risen she can tell him that he must be silly to believe such a story. We all know the effect which the reductions in me food subsidies has had on food prices. Other prices may remain static or they may go up or down, but the full extent of the influence of food prices is not reflected in the index on which we have So work.

There has been a change in food prices which has brought about a change in the spending habits of the people. Until February, 1952, the weight of food in the index was 348 in the 1,000 points. That weighting has been increased to 399 out of 1,000, which is roughly 40 per cent. If we analyse the position we find that wage earners whose basic rate is 125s. spend £2 10s.—or 40 per cent, of a basic rate—on food. If we try to buy food costing only £2 10s., we do not get very far towards feeding the average family. I have been told that the amount spent by the average family on food at present is somewhere in the region of £4 a week, or 55 per cent. of the family income.

Is that figure on the basis of purchasing exactly the same quantities as they did previously, or on the basis of feeding their families very much better?

I do not know exactly what the hon. Gentleman is getting at. I am trying to analyse the cost of living which is a matter of great importance to the majority of working-class people who cannot understand why the cost of living is going up all the time—

It is not.

whereas they are told by this Government that it is not rising.

I should like to draw attention to the change in spending habits of people brought about by necessity. Let me give the following illustration to show how personal spending has changed from the first quarter of 1952 to the first quarter of 1953. In the first quarter of 1952 £755 million was spent on food as compared with £847 million in 1953.

For rent and rates the difference is £179 million and £190 million, an increase of £11 million. For travel to and from work the difference is £84 million as against £89 million, an increase of £5 million. On fuel, it was £130 million as against £137 million, an increase of £7 million. That is expenditure with which people in the lower income groups are obliged to contend.

Expenditure on entertainments went down from £49 million to £43 million, tobacco from £109 million to £95 million and drink from £187 million to £186 million. These changes have taken place because food must, of necessity, come first, and poor people have to pay more for their food, with the result that they do not have enough to spend on other things. I submit that those on low fixed incomes have been debarred from the vital necessities because of the high cost of food, and I hope that the Chancellor will give them a fair deal when he produces his next Budget.

3.28 p.m.

The hon. Member for Southampton, Test (Dr. King) introduced this Motion in a speech which, but for a party thrust early on, was dispassionate and objective and set the tone for the whole debate. I do not think that our debate has been the worse for the fact that party thrusts have been few and far between. I think the hon. Gentleman was fully matched by his hon. Friend the Member for Southampton, Itchen (Mr. Morley) in a speech of much the same quality.

I referred to an early party thrust by the hon. Gentleman, and I wish to follow that note for a moment, though I do not want to spoil the non-party atmosphere which we have had today. At the start of his speech the hon. Member for Test congratulated my hon. Friends the Joint Parliamentary Secretaries who, he said, were Tory Ministers efficiently administering Socialist social services.

Anyone who reads that sentence tomorrow in the OFFICIAL REPORT might get the impression that social services in this country started in 1945, and I think that for the sake of the record we should recall Lord Shaftesbury. Benjamin Disraeli has been referred to today as having "dished the Whigs," but he did quite a few things besides "dishing" the Whigs. Neville Chamberlain himself was associated with such a proposal as we are discussing today, though under a different name.

I do not want to go on with such instances, but I do feel that, for the sake of the record, I should make that clear. The right hon. Member for Llanelly (Mr. J. Griffiths), the right hon. Lady the Member for Fulham, West (Dr. Summerskill) and Members of all parties have contributed to these social services, and the only thing to which I have taken exception was the impression that might be given that they only started in 1945, which is not the case.

The debate as a whole has naturally revolved almost entirely round Govern- ment pensions, but my hon. Friend the Member for Tynemouth (Miss Ward) drew attention to the fact that there are quite a large number of other people living on fixed incomes, such as annuitants who purchase annuities by means of the savings of useful and thrifty lives and being able to invest those savings, and no kind of monetary grant by a Government can possibly bring assistance to these people. How any Chancellor of the Exchequer can look upon these other kinds of fixed incomes, whether annuities or not, and say they should be classified as unearned income, I really do not know, because I know of no incomes which have been more hardly earned.

The point which has been rather overlooked in the debate today is that inflation has been going on ever since money was devised to take the place of goods. The producers of goods and the providers of services which are urgently needed by the rest of the community can always protect themselves against inflation by the threat, which they may put into action at any time, of preventing the production of their goods or withholding their services. The pensioner and the annuitant have no such remedy, and they are the persons who suffer most from both.

The hon. Member for Itchen posed a rather knotty question, which I thought was a non sequitur. He said that surely, if hon. Members on this side of the House had to choose between taking £51 million off the standard rate of Income Tax and giving £51 million to the old-age pensioners, he had no doubt that we should agree to give the £51 million to the old-age pensioners. I think that is a complete non sequitur, because it seems to me quite futile to give an extra £51 million to the old-age pensioners if the result of doing it will be such inflation that the existing pensions, with the addition of that £51 million, buy less than the existing pension at the present time.

How can the giving of £51 million to old-age pensioners be more inflationary than giving £51 million to taxpayers?

I simply say that it was a non sequitur, and I still think that is true, because if that £51 million were to be given to the taxpayer, and if it was used, as the hon. Gentleman himself would like it to be used, on the purchase of new plant and equipment and more modern machinery—[ Interruption ]. Some of the hon. Gentleman's hon. Friends do not support him, but it is his own argument which I am following up, and I say that that process will result in cheapening the cost of production and in lowering the cost of living, with a resultant benefit to the old-age pensioners and everybody else, whether they pay Income Tax or not. That was the hon. Gentleman's own argument, with which I entirely agree.

Only two things can be done to alleviate the hard lot of the old-age pensioner and the other recipients of fixed incomes. It is obvious that from time to time the Government of the day must revise the rates which are paid to the old-age pensioners, but I do not envy the Minister who has to make the decision whether or not the time has come to revise those rates. Obviously, if the old-age pension and other pension rates are tied to the cost-of-living index we shall have so much inflationary pressure that we shall not have a reduction in the cost of living at all. It is the difficulty of arriving from time to time at periodical finality, which is the old military phrase. Obviously there must be a time when the rates will have to be reviewed.

The other remedy, which applies not only to the person in receipt of Government pensions, but to annuitants and recipients of small dividends, is the increased productivity to which reference has been made. The way in which that can be stimulated is by reduction in the rate of direct taxation. It is a matter of historic fact that between the wars the cost of production and the cost of living fell. The hon. Member for Itchen, in a wise as well as a difficult question, seemed to acknowledge that fact when he asked, "Have we to choose between low prices and unemployment or high prices and full employment?" I do not think that choice has necessarily to be made.

In the last 20 years our knowledge of the circumstances which have led to unemployment and of the financial policies which have to be followed to combat unemployment, has increased very considerably. I do not see why there should not be an increase in productivity with its corresponding reduction in the cost of living without that deflationary pressure which led to drastic unemployment between the wars. The old saying about wages chasing prices in a vicious spiral has not been true over the last 300 or 400 years. What has happened has been two twirls up, and one twirl back. Otherwise the standard of living of the people of this country could not have increased over the last 200 or 300 years as in point of fact it has. If we wish to make sure that that spiral is not vicious we must increase productivity for the benefit of all. When I see claims made by workers for a 15 per cent, increase in wages I very much wish that we could have a cry instead for a 15 per cent. increase in the production of goods and services, because it would do far more good to all concerned.

How should we ensure that the workers got their fair share of the 15 per cent. increase in production?

I thought that was the job of the trade unions, which their history shows they have done extremely well. I am sure that the hon. Gentleman would not decry the efforts of his friends in the trade union movement. I hope we shall soon cease to talk about "the two sides of industry." Although there are two sides in this House there is in industry only one side, the producing side. We need in this country, as in the United States, to co-operate in making the industrial cake as large as possible so that those concerned can go and get the largest share to which they are entitled. That is the way it can be done in this country, and has been done in the United States.

I enjoyed the speech of the hon. Members for Test and Itchen, and the other speeches which have been made. The lot of the fixed income recipient is undoubtedly a hard one, and the key to that problem is not in the hands of the old-age pensioners themselves, but in the hands of those who have not reached pensionable age, those who, to use that old-fashioned word, work and who produce goods and services. If we in this country were prepared to work as hard in 1954 as were our grandfathers in 1904, we should not be having this debate today, because, instead of rising, the cost of living would be falling.

3.40 p.m.

I am sure that every hon. Member will agree that we have had a most interesting and important debate. As the Parliamentary Secretary said, it is a valuable thing that this House should express an opinion on this problem. I think we are all ready to congratulate my hon. Friend the Member for Southampton, Test (Dr. King), not only on the fact that when he had the good fortune to come out first in the Ballot he selected this subject, but also on the very excellent way in which he put forward his case this morning in a very powerful speech.

I also wish to congratulate my hon. Friend the Member for Southampton, Itchen (Mr. Morley) who seconded the Motion. The speeches to which we have listened today have covered every aspect of this problem, and I believe that every type of pensioner and person living on a fixed income has been mentioned. Indeed, my hon. Friend the Member for Itchen managed to bring in that much abused section of the community, the teachers. He also managed to include the former railway employees who are having a rather raw deal in this matter.

A number of hon. Members made very powerful speeches on behalf of the disabled ex-Service man. They included the hon. Member for Morecambe and Lonsdale (Sir I. Fraser), my hon. Friend the Member for Brierley Hill (Mr. Simmons), the hon. Member for Belfast, East (Mr. McKibbin) and the hon. Member for Tynemouth (Miss Ward). I think everyone will agree that if there is one section of the community which deserves our sympathetic consideration more than any other it is that of the war-disabled. I am sure that every hon. Member is anxious that everything that can possibly be done for these men should be done.

The subject which we are debating today rather lends itself to party political propaganda, but it is very noticeable that there has been very little of that in the speeches to which we have listened. That fact was commented upon, and, indeed, the Parliamentary Secretary went so far as to say that the only person guilty of it was my right hon. Friend the Member for Fulham, East (Dr. Summerskill). Of course, he forgot to mention the ill- informed intervention made by his hon. Friend the Member for Tynemouth.

On the subject of the scoring of party points, I do not think that the Parliamentary Secretary did badly himself. He made a political speech, and some of the figures he gave rather fascinated me. I do not know where he unearthed them. I have stopped paying much attention to figures quoted by the Government Front Bench since the time when in one week we had four different figures concerning the increase in the cost of living from four different Ministers.

This is a subject, of course, on which it would be easy to score party points, but there is a general concensus of opinion that here is a very serious problem, and one from which we cannot run away. As I have said, this debate has covered practically every aspect of the problem, and if I concentrate on the question of the old-age pensioners it is not because I am not interested in or concerned about the other matters, but simply for the sake of speed in making my point and because I believe that if the case for the old-age pensioner is met, we shall thereby have made the case for the other pensioners.

No one has suggested that the present Government have not done anything for the old-age pensioners and for other pensioners. To suggest that would not be true; it would be demonstrably untrue. But we are now faced with a different set of circumstances. New circumstances have overtaken us, and what was done in the past is not sufficient at the present time. I think that it might be helpful to look back briefly to what has taken place since the Report of the Beveridge Committee.

The Beveridge Committee recommended that over a period of 20 years pensions should be raised from 10s. to 26s. I do not think that the Beveridge Committee anticipated that world prices would rise to the extent that they have done. Of course, the Beveridge Committee was concerned in having a system which was actuarially sound, the idea being that we take out what we have put in. But surely we have left that idea entirely. However desirable it may be, we have been compelled to abandon it because of the increase in the cost of living.

One of the greatest pleasures in living at the present time is that we have a better social conscience than the world has ever known before. I do not think that there would be more than an odd person in the country who would take up the attitude of an hon. Member who, when the pensions were first placed at 5s., said that it would sap the moral fibre of the nation.

So we are all interested in the problem and look to its solution. The Labour Government did not wait for 20 years but put up the old-age pension immediately to 26s. I take it that hon. Members opposite will give us credit for what we have done, just as I have given credit to the Tory Government for what they have done. The pension was again increased to 30s. The present Government increased the old-age pension to 32s. But I think that there are two points which we must remember about this. There had been an increase in the cost of living since the previous increase, and any increase made by the present Government only rectified the position. That increase was immediately followed by cuts in the food subsidies, which took back with the right hand part of what had been given with the left.

There has been a further steep increase in the cost of living. It is no use saying that the cost of living has been stationary in the last few months, even if we could persuade the old-age pensioners to believe it. I think we must agree that it is time the cost of living became stationary or began to go down, but the problem goes further back than the last few months. As I have said, it goes back to the time of the last increase. Surely there is no argument about the increase since the last adjustment was made.

We cannot have a clearer picture of this than that given by the Financial Secretary to the Treasury in answer to a Question by the hon. Member for Goole (Mr. G. Jeger) on 11th February of last year when he said that to restore food prices to the level ruling in October, 1951, it would be necessary to raise the cost of the food subsidies to between £700 million and £800 million per year. Obviously, that is the complete answer to any argument that the cost of living has not gone up.

rose —

I am sorry, but I cannot give way. The hon. Gentleman has not been present during the debate.

The position is also indicated by the increased numbers, as the Motion says, who are on National Assistance. In answer to my hon. Friend the Member for Oldham, West (Mr. Hale), the Joint Parliamentary Secretary, on Wednesday of this week, gave the figures of old-age pensioners who are on National Assistance as 1,095,000, an increase of 230,000 over October, 1951. The number actually receiving National Assistance is more than that. At first, I thought that this was just one of those Front Bench figures again, but I decided that the 1,250,000 referred to the whole range of people on National Assistance and the other figure to old-age pensioners.

The 1,250,000 refers to men and their wives. The 1,095,000 refers to actual households. I tried to make that clear in my speech. I do not want there to be any misunderstanding about it.

I accept those figures. I am glad to find that there is unanimity in the Department about them.

I want, in passing, to pay a tribute to the National Assistance officers for the excellent work that they do, and particularly to the local officers for the very humane way in which they carry out their duties. As has been—it was first pointed out by the hon. Member for Lewisham, North (Sir A. Hudson)—not all the people who need National Assistance are going to the National Assistance officers, and the plight of such people must be very serious indeed.

This is in spite of the fact that hon. Members on both sides of the House have done their best to explain to the people that National Assistance is something which is there as a right and is not charity. However, memory of Public Assistance and the means test dies very hard. I hope that further efforts will be made to convince all that, if they are in need, National Assistance is there to help them and that they ought to make use of it.

Another reason why I consider that the case is made out is the non-take-up of rations. The hon. Member for Lewisham, North seemed to think that that was no indication at all because of the fact that he lived in an establishment where catering was provided and so did not take up his own rations. There may be odd cases like that of the hon. Member.

I am not alone in that.

I should like to quote some figures given by the Ministry for the week ending 28th November, 1953. The number of bacon rations not taken up was 7,100,000. I do not think that the hon. Member will suggest that there are 7,100,000 persons in the position that he is in.

They might have been Jewish persons.

The other rations not taken up were: butter, 1,900,000; margarine, 8,200,000; cooking fat, 5,900,000; and cheese, 13,500,000. That is a clear indication if we remember—[ Interruption ]. I wish the hon. Member for Croydon, East (Sir H. Williams) would not interrupt.

I merely said that that was gross and misleading. That is all.

I wonder whether the hon. Member knows the Spanish proverb:

"En boca cerrada no entra moscas."

I speak only Welsh.

Then perhaps the hon. Member would like to know the meaning of the proverb. It is, "Flies do not enter a closed mouth."

I believe that the position which I have indicated is even more serious, because a number of people are getting more than their rations. Therefore, the number doing without rations is even greater than that indicated by the figures which I have given.

I wish to say a word or two about the Interim Index of Retail Prices. The Joint Parliamentary Secretary said that we should not say anything which would make people doubt the validity of the figures. I shall not argue against the index at all. It is the best measuring yard which has yet been devised for the average person, if such a person exists. But the pattern of spending varies with different income groups and obviously amongst the poorest food takes a much higher proportion of the income than it does with others.

If we look at the items in the Interim Index of Retail Prices we find that these occur: Food, rent and rates, clothing, food and light, household durable goods, miscellaneous goods, services, alcoholic drink, and tobacco. It is quite obvious from these items that it is food, fuel, light, rent and rates which are the most important items in the index. When it is suggested that the old-age pensioner is spending only 40 per cent, on food, it will be seen he is not doing so well, as 40 per cent. of 32s. 6d. comes to only 13s.

Time is getting on, but I should like to call attention to certain figures which are different from those given by the Parliamentary Secretary. I have worked out according to Government publications that the overall increase since October, 1951, has been 11 points, for food 16·1, for rents and rates 9·9, a slight reduction in clothing, an increase of 21 in fuel, a slight reduction in household, durable goods, an increase in miscellaneous goods, an increase in services and a very slight variation in alcohol and tobacco.

On this very important question I have had many letters from old-age pensioners, as I am sure other hon. Members have had, and I should like to quote one sentence from one of them:

We here can do two things. We can reduce the cost of living, which requires Government action, or we can increase the amount of the pensions. We cannot expect today to be told that there is going to be extra money for old-age pensioners in the Budget. But if there is money available I hope he will make it available for those who are in the greatest need, pensioners of every kind. I have had to cut short my remarks, but I hope that this Motion will be accepted in the way in which it is drawn by every Member of this House.

rose in his place and claimed to move, "That the Question be now put."

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

Question put accordingly, and agreed to.

Resolved,

That this House, believing that one of the high purposes of a Government ought to be to establish an adequate minimum standard of living for its poorest citizens, expresses concern at the increasing numbers of those living on pensions and other low fixed incomes who have to apply for National Assistance in order to avoid grave hardship; and urges Her Majesty's Government to increase the level of such pensions and incomes where possible, and, at the same time, to safeguard and enhance their value by making every effort to reduce the cost of living.

I wish to detain the House to consider a matter of deep human importance, the question of the British unmarried mothers of children fathered by American Service men.

I raise this question for three reasons. First, because there are increasing numbers of young women and their children suffering unnecessary injustice and hardship. Secondly, because in matters of this kind responsibility, at least financial, should be divided equitably between the man and woman involved. Thirdly, because I am sure that our American allies are eager to help, and could help, to remedy this injustice.

Information about the number of women involved is difficult to obtain, but if the testimony of the correspondence received by some of us is anything to go by, it is true that an increasing number of women are involved in hardship and in serious obligations which in many cases they cannot meet. Further than that, as a result of inquiries, I have discovered that in respect of one American camp alone, which I shall not name, a Church of England Organisation dealing with some of these unfortunate women reports that so far this year 69 cases have been brought to its attention. And that is only one organisation. There are other organisations, such as Roman Catholic and Free Church and, in addition, there must be young women who do not give information to any organisation but have their child secretly. Beyond that, we must take into account a proportion of tragic abortions.

What I have said is sufficient to remind us of the seriousness of the present state of affairs. The difficulty is that although affiliation orders are granted against American Service men, and can be operative as long as they are in this country, directly the man concerned leaves, the order is no longer operative. I have evidence to prove that in many cases American Service men involved in paternity cases have deliberately found a means by which they can be returned to their country. Once they are back there, no obligation rests upon them except that of a purely moral character. Unfortunately, it is only too true that, although there is a moral obligation, in few instances is it fulfilled.

I am informed by one organisation dealing with this problem that it knows of only one case where any kind of endeavour was made to meet the need of the unfortunate girl left behind with her child, and in that case only a lump sum of £50 was offered. In an increasing number of cases the men return to America, they no longer have any legal obligation, they bury their sense of moral obligation, and the girl is left here to bear what. I think, is a triple burden.

I know that this is no new problem and that it obtained during the war. Wherever men from overseas settle down here in encampments for even a short period this human and ancient problem is bound to arise. It is, of course, as great with regard to our young men overseas. Incidentally, it is rather significant to realise that according to a statement by the West German Government, on 12th March, about 94,000 illegitimate children were left in the West German area as a result of liaisons between German women and non-German troops. It is the fact that Aphrodite and Mars are frequently found in irregular liaison.

When men are away from home and family attachments they tend to become reckless and irresponsible. That applies not only or particularly to American Service men, but to all Service men everywhere to a greater or less degree. I do not want it to be assumed that I am attacking Americans in general or American Service men in particular. I am only applying this to a number of them, though a significant number.

The young woman who is involved in this problem has to meet a triple burden which is not imposed upon the man. She has not only the physical strain, to which a man has not to submit, but always maternity is of far greater significance to a woman than paternity can be to a man. In the one case it is fundamental, comprehensive, and permanent and in the other incidental and transitory. That is in the nature of things. In that sense the woman alone bears a particular burden.

Secondly, there is the emotional distress involved. The attachment which she has formed for the man is not often of a transitory or superficial character. The letters that I have received are poignant in the extreme in revealing how deeply attached a woman can be to a man who has had contact with her, physical and otherwise, but who goes away and leaves her. Men do not appreciate the deep wounds that they inflict upon a woman's heart by these experiences. She suffers emotional distress and a feeling that she has been let down or, to use an old-fashioned phrase, that she has been betrayed. She has to go on enduring that.

Thirdly, there is the financial burden. I do not believe that one should compel a man and woman who have formed a liaison to marry. That is something that they have to decide for themselves. Indeed, compulsory marriage often does the worst possible service to those involved. But that does not alter the fact that apart from every endeavour by the man to avoid imposing emotional distress upon the woman for whom he has formed a temporary or deep attachment, there should be a sense of financial obligation. I urge most strongly that there should be a full appreciation of the financial strain on the woman and, indeed, her family and the British State, for the child has to be maintained.

Fourthly, there is the sense of resentment and bitterness that sometimes circulates in the mind and soul of the women involved and which does not make for the greatest sense of friendship and amity between the people of this country and people overseas. This tragic recklessness has that effect, and I want to see British and American peoples increasingly getting to understand each other. A state of good will is imperative to our nations.

What can be done in these circumstances? I am very glad that opportunities exist now for affiliation orders to be taken out against a man while he is in this country. Therefore, he is under a legal obligation to contribute towards the support of his child. When he goes back to America he does not contribute. I suggest that the military authorities should be approached in the first place with a view to a deduction being made from his pay so that at least while he is in this country, and quite apart from his own decision to do so, as I hope that he would decide voluntarily, that amount is deducted. I suggest, further, that is it not impossible for the same military authorities to continue to make the deduction if and when the man returns to his own country. That would go some way towards helping in this situation.

I also urge that it should be possible for the military authorities to secure agreement on the part of their Government to hold the man responsible by American law for whatever obligation he has contracted in this country. I should like to see regard for non-human contracts in regard to duties, but particularly in regard to these human contracts and human indebtedness.

I therefore ask the Minister whether that line could be explored and to see whether the American Government could take over responsibility so that, when the man leaves the fighting forces, in America he will still be held under legal obligation to the American Government, which, in turn, can be associated with our Government, to see that some financial provision is made for the child the man has begotten. I do not believe American responsibility is impossible. Everything should be done to explore the possibility to remove what might be a very deep sense of bitterness and resentment in this country, which is by no means confined to those directly involved.

Implicitly, this raises a much larger question, into which I shall not go now. If we could secure an arrangement such as I have described it might lead to an international arrangement on the same principles. The problem is a vast one and will remain increasingly so because troops are not confined to a particular area, but will be increasingly found in other lands by agreement with the Governments in whose territory they are situated. If between ourselves and the American Government we can set an example by making some arrangement such as I have described, it could be not only an important contribution to Anglo-American good will but would help to meet the human need of a large number of women in this country.

4.12 p.m.

I am glad that my hon. Friend the Member for Leyton (Mr. Sorensen) has raised this question, if only to allow the Government an opportunity to try to make the position much clearer than so far they have made it in answers to Questions raised in this House. I am very sorry that we have not time this afternoon to have a full debate on this matter, because the unsatisfactoriness of the position could hardly be exaggerated.

I think that the only error my hon. Friend made in his speech, perhaps innocently, was when he suggested that when a British court makes an affiliation order against an American Service man it is enforceable. That is our problem and the problem arises because, as matters stand at the moment, it is not enforceable.

I think it is about to be made enforceable.

That is what I am hoping, but, judging from the answer of the Home Secretary the other day, I am not at all sure about that. I hope the Under-Secretary will make quite clear what is the position.

I am sure that my hon. Friends must agree that the point was not made clear in the answers given to Questions we have put to the Home Secretary. In the most recent reply he gave, the Home Secretary, referring to the Regulation under the Visiting Forces Act and, I presume, referring to the future, said:

We all know it is not enforceable when he returns to the United States. But let me cite a definite case. I know of a case where a British court has made an order enforceable against, one would presume, an American Service man in this country. The American airman concerned made several payments of a few pounds and then he ceased to pay and the matter was put into the hands of solicitors. When the solicitors approached the American authorities, and here I am quoting from authoritative American sources, this is the reply they received:

I would ask the Under-Secretary of State to try to answer these points and make clear what the position is today in cases in which affiliation orders have already been made in Britain. Can he tell the House that as a result of negotiations he has had with the American authorities they are now to be enforceable?

Will he also tell us what is the position when the American offenders are transferred to the United States? I do not think I am exaggerating—certainly not consciously—when I say that I believe it is the experience of those who have concerned themselves in these matters that they find when such cases are raised that the American authorities, conveniently or otherwise, find it possible to get the American soldier out of the country. In which case not a further penny piece is paid to these unfortunate women.

I think the whole country is concerned, not so much perhaps with the mothers or even the fathers of these children, but we have the right to be concerned about the children and in their interests this matter should be decided quickly.

4.19 p.m.

I do not intend to detain the House for very long, because I wish to give the Under-Secretary of State an opportunity to reply. When the Secretary of State for the Home Department made a statement in the House last week on this subject I asked whether, in the event of an affiliation order being made and the man concerned subsequently leaving the country, the American: authorities were prepared to enforce the: order. The right hon. and learned Gentleman said that as the law stood today it did not allow of any enforcement.

I wish to put it to the Under-Secretary that this question should be approached entirely differently. For the first time we have in Britain a foreign army in peacetime. I think it fair to say that the British people have welcomed the American Service men with the greatest hospitality. Indeed, they have been asked to invite American Service men into their homes. Are there to be privileges enjoyed without obligations? My hon. Friend the Member for Leyton talked about the recklessness which one would expect during a war. Certainly, but there is no war on at the moment. We do not expect a reckless attitude in peace-time.

Furthermore, I should like to know for how long this is to continue. If the American Army is to be here indefinitely, is it to be allowed—I do not think that this is too strong a term—to abuse our hospitality? As a former Minister of National Insurance, I am conscious of the fact that if a girl has a baby and finally obtains an affiliation order but subsequently that order is not observed.

she must have recourse to the National Assistance Board.

Thus the people who must bear the burden of these thousands of illegitimate children are the members of the British public, through the National Assistance Board. The British taxpayer will be called upon to support this burden. I should say that if this is to go on indefinitely the taxpayers are entitled to protest. This, therefore, is the time for the Government to reconsider the whole position.

4.21 p.m.

I hope to be able to answer the questions which have been put to me. First, I should like to say a few words about the size of the problem to which the hon. Member for Leyton (Mr. Sorensen) referred. The size seems to have been grossly exaggerated, and the exaggeration seems to have resulted from an article in the "Washington Post," which spoke of a figure of 70,000 British unmarried mothers' children by United States Service men.

I did not quote that figure.

I want to quote that figure myself to say that, as far as I am aware, it is completely inaccurate. Indeed, the author of the article has since admitted that the figure was without any foundation whatever.

I have consulted the American authorities, both at the Embassy and the Service authorities here, and I should like to express my thanks to them for the help they have given and the search they made in order to satisfy the House and to put the position before the country. The position, as I understand it, is that altogether the American authorities in this country have received some 1,200 inquiries—a very different figure from the 70,000 unmarried mothers—some of which have probably been duplicated because perhaps the same inquiry has been sent to the Service Departments and to the Embassy from the same woman.

They have had 1,200 inquiries from unmarried mothers who wish to get in touch with the fathers of their children with a view to maintenance. It is known that at least 300 of these women have since married American Service men. About 100 cases are believed to be outstanding; that is to say, no marriage has been contracted, no maintenance has been paid and efforts are still being made to effect a settlement.

This leaves about 800 cases which I understand have either been disposed of by a maintenance settlement, sometimes as a result of a court order being complied with, and sometimes as a result of an arrangement directly made between the two parties, or the inquiries have been dropped altogether by the mothers. I need hardly add that in any outstanding cases where hardship can be shown the National Assistance Board is available and has, I understand, on occasion made grants towards assisting these women. I have not got the figures because that would involve consulting all the local authorities and all the National Assistance Boards throughout the country.

I should add that the figures I have given represent those cases which have been the subject of inquiries through the American authorities in this country. There may well be other cases unknown to the American authorities or to the British authorities where mothers have applied for help direct to the men concerned either with or without satisfaction.

I should like to say a few words about the affiliation order procedure. Since 1942 American Service men in this country have shared the immunity from enforcement proceedings in British courts which is conferred upon British Service men by Sections 144 and 145 of the Army Act. This immunity from enforcement proceedings will continue until the Visiting Forces Act comes into force, that is to say, that no American Service man can at present be committed to prison in this country for failure to comply with an affiliation order, just as in the same way no British Service man can be so imprisoned.

Furthermore, between 1942 and 1949 the American authorities were able to pay allowances on behalf of illegitimate children, but that right was removed from them by a Congressional Order in 1949, and since 1949 the American Army authorities have been unable to pay allowances from the pay of American Service men. Further, the American Service authorities have not had the power since 1950 to take disciplinary action where an American Service man refuses to comply with an affiliation order.

Since then, I frankly admit, the position has been unsatisfactory both as regards American Service men in this country and American Service men when they have left this country. It is, however, only fair to say that the American armed forces have always done their best to use persuasion on the men concerned, and it is also fair to say that their inability to take disciplinary action in these matters and likewise their inability to make deductions from pay conforms fully and entirely to the practice of our own Service authorities as regards British troops serving in foreign countries.

Or in the Colonies.

Indeed, where deductions from pay are concerned, the American Service authorities are unable to make such deductions in respect of paternity decrees issued in America.

Let me deal with the position which will arise when the House has approved, as I trust it will, the Orders in Council laid yesterday by the Home Secretary which will bring into force the Visiting Forces Act, 1952. As the Home Secretary said on 11th March, when the Act comes into force the existing legislation will be revoked. A new situation will arise, and I think the House will agree there will be a much more satisfactory position.

The position will then be that an affiliation order made by a British court against a member of a visiting force will be enforceable by committal to prison—this is the answer to one of the questions that I was asked—in the last resort by the ordinary processes of the law. I am sure, however, that we all hope that payment will be secured without having recourse to these proceedings, and I am sure that we and the American Service authorities over here will keep in very close touch and co-operation on this matter.

I believe that any existing affiliation orders will become enforceable under this new legislation in the same way as orders made after the Act. I believe that is the case, but of course the decision in particular cases must inevitably be a matter for the courts. I cannot anticipate the courts' decisions, but I believe that under the law as it will then stand existing orders will be enforceable in the same way as future orders. As my right hon. Friend made clear, these provisions will apply within the territories within which Parliament can legislate, which will of course include the Colonies, as laid down in the Act.

Let me deal finally with the position of the American Service man once he has left this country. Once he has left this country he is in exactly the same position, so far as the arm of the British law is concerned, as any other foreigner or, for that matter, any other British subject who goes abroad and defaults on an affiliation order. Our domestic legislation cannot provide for the enforcement of laws and decrees in the courts. Thus the provision in relation to their enforcement overseas is unaltered and unalterable.

Why unalterable?

Because we are dealing with other people's territory, and it is unalterable by the Visiting Forces Act or by any other legislation which the British Parliament may care to pass. We are, however, discussing with the United States authorities the question of compliance with affiliation orders by Americans who leave this country. There is this additional point which I would put to the House. The United States Veterans Administration have power in approved cases to make pay allotments on behalf of illegitimate children from ex-Service men's education and disability grants.

The House must realise that, whatever arrangements we may be able to come to with the United States authorities, and with the best will in the world, they would have absolutely no legal power under their own law over an American Service man once he had left the American armed forces, and, in that respect, they would be in the same position as any other foreigner and outside any disciplinary action.

But have they no power on the American Service man while he is in America?

That is the position which we are discussing with the United States authorities, and we hope we may be able to make some arrangement about it.

The hon. Member for Leyton asked me about some kind of reciprocal agreement or convention. The objection to a multilateral convention is that we should have to accept in our courts orders made for enforcement by the courts of the member States which are signatories to the convention. That is a posi- tion which I do not think this Parliament could accept, and, at the moment, the position is that no affiliation orders are accepted in British courts against any British Service man—

The Question having been proposed after Four o'Clock, and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at Twenty-nine Minutes to Five o'Clock.