With permission, Mr Speaker, I should like to make a statement about the British citizens detained at Guantanamo Bay.

Agreement with the United States Government on the return of five of the nine UK detainees was reached on Thursday last, 19 February. Although the House was in recess, I judged that it was only fair to the families of all nine detainees that they should be informed immediately. We therefore made every effort to contact the families and their parliamentary representatives, and I made a public announcement late on Thursday afternoon. I could not report to the House yesterday, as I had to attend a European Union General Affairs Council in Brussels.

The attacks of 11 September 2001 were the most appalling terrorist atrocity the world has ever seen. The terrorists killed more than 3,000 people, including 67 British citizens. In response to those attacks, a coalition of countries came together to launch a military campaign against al-Qaeda and its Taliban supporters to remove them from their strongholds in Afghanistan.

In those operations, thousands of individuals believed to be al-Qaeda or Taliban fighters, or their supporters, were detained by coalition forces. The vast majority of those individuals were released, but those who were deemed to pose a substantial risk of returning to the conflict—to date about 800—were sent by the United States to its naval base in Guantanamo Bay, there to be detained and to be questioned about their knowledge of al-Qaeda's activities. As a result, valuable information has been gained, which has helped to protect the international community from further al-Qaeda and related terrorist attacks.

The Government have been in frequent and regular contact with the United States authorities concerning the British detainees at Guantanamo Bay. From the outset, the British Government have sought to ensure their welfare and have actively encouraged the US Government to resolve the position of the British detainees. British officials have visited Guantanamo Bay six times. We have kept the detainees' families and Parliament informed of their circumstances and of other related developments.

In July 2003, two of the British detainees were designated by the United States authorities as eligible to stand trial by the United States military commissions established to prosecute the detainees. The British Government made it clear straight away that we had concerns about the military commission process. Consequently, the Prime Minister asked the Attorney-General to discuss with the United States authorities how the detainees, if prosecuted, could be assured of fair trials that met international standards.

The Attorney-General therefore held a number of discussions with the United States authorities about the future of the detainees. In parallel, the Prime Minister has talked to President Bush; I have discussed the matter on many occasions with US Secretary of State Colin Powell; and extensive discussions have been held between British and United States Government lawyers and officials.

Those discussions have involved many complex issues of law and security, which both Governments have had to consider carefully. Although the discussions have made significant progress, the Attorney-General's view was that the military commissions as presently constituted would not provide the process that we would afford British nationals.

Our discussions with the United States authorities are continuing. In the meantime, as I announced last Thursday, we agreed that five of the British detainees would return to the United Kingdom. The five are Rhuhel Ahmed, Tarek Dergoul, Jamal al-Harith, Asif lqbal and Shafiq Rasul. Those men will be flown home to the United Kingdom in the next few weeks. The House will understand that it would not be right to disclose the operational details at this stage. The police have, however, established links with the families so that they can be informed of developments.

The police have confirmed that, once the detainees are back in the United Kingdom, where there are grounds under the provisions of the legislation, the five men may be arrested under the Terrorism Act 2000 for questioning in connection with possible terrorist activity. Any subsequient action will be a matter for the police and the Crown Prosecution Service. It would therefore not be appropriate to comment further on their particular cases, but I should like to emphasise two points.

First, the police have said that they are investigating all the detainees thoroughly and individually, in the normal way, which includes considering the circumstances that led to the men's detention. Every necessary step, including prosecution if appropriate, will be taken to protect national security. Secondly, the detainees will be treated in the same way as anyone else suspected of committing a criminal offence and, obviously, in accordance with UK law. Our processes have built-in safeguards and are subject to independent scrutiny to ensure that all individuals are treated fairly and properly. Those processes include access to lawyers.

We shall continue our discussions with the United States authorities on the situation of the other four British detainees. They are Feroz Abbasi, Moazzam Begg, Richard Belmar and Martin Mubanga. There are a range of security and other issues that we and the Americans are considering in respect of those four men. As a result of our talks, US legal proceedings against Mr. Abbasi and Mr. Begg were suspended in July and the US said that the men would not be subject to the death penalty. That remains the case.

Our overall position remains that the detainees should be either tried in accordance with international standards or returned to the United Kingdom. We shall continue to work to resolve their positions, and I will, of course, keep the House informed.

The Government remain determined to work with our allies around the world to defeat the scourge of global terrorism. Terrorism seeks to deny the most basic of human rights—to life,to security and the right to go about our daily business free from threat and harm. We will continue resolutely to defend those rights through a robust and determined approach to combating terrorism and its networks of support wherever they are to be found.

May I start by thanking the Foreign Secretary for his statement and for early sight of it?

The Conservative party welcomes the fact that some progress has now been made— after two years—in resolving the prolonged incarceration of five of the nine British detainees held at Guantanamo Bay, but does the Foreign Secretary accept that his statement today raises as many questions as it answers?

Although we recognise the uniqueness of their interim status as unlawful combatants, we have consistently called for the British detainees to be subjected to due process, rather than being held in a legal limbo land. They should be either brought back to this country to face a fair trial, or if there is no evidence of wrongdoing against them, set free. Although we obviously assert that national security has the highest priority, we do not believe that to be inconsistent with a proper and timely assessment of each case and a consequent decision to prosecute or release.

Given the strength of the relationship between the British and US Governments, can the Foreign Secretary explain why it has taken nearly two years to get this far? Does he now accept that one of the reasons why that stalemate has taken so long to overcome has been the failure of the British Government to make a clear decision on how to treat the detainees in this country on their return? Can he tell us what the difference is between those who are to be released and those who are not? Does he believe that the four who will remain constitute a threat to national security, and how much longer is it likely to take until their future is resolved? Is it now likely that they will face trial before one of the military commissions that the US seems to favour? Given what the Foreign Secretary said about the advice that the Attorney-General has given, what will be the Government's response if that is the case?

The Home Secretary, in one of his now infamous preemptive judgments on innocence and guilt, informed the world's media that none of the five who are to be released

"represents a security threat to the British people."

Does the Foreign Secretary agree? Given that we are talking about individuals who more than two years ago left this country to go to Pakistan or Afghanistan—allegedly to explore the possibility of fighting alongside the Taliban and/or al-Qaeda against British interests—how does the Home Secretary know that they will now pose no such threat? If proceedings are to be brought against one or more of the released detainees in this country, how will the Home Secretary's comments help them to obtain a fair trial?

The Foreign Secretary said that on the detainees' return, the police and the Crown Prosecution Service would look at each case dispassionately to decide whether there was sufficient evidence to place a person on trial in this country. Will he confirm that evidence obtained from the detainees during their time in Camp Delta will be made available to the police and the CPS to help them to assess the case for a fair trial? Has he received any legal advice on admissibility and, if so, will he place a copy in the House of Commons Library? Will he confirm whether the Attorney-General has actively considered whether, if the evidence so provides, an action for treason could be brought against any of the released detainees? Will the Foreign Secretary say a little more about the circumstances in which the five will be held in the UK on their return? Will they be at liberty to return to their homes, or will they be held in custody—if so, on what basis?

We strongly support all measures to protect our national security, but this country rightly prides itself as a true champion of the rule of law and the rights of the individual. In the Government's continued handling of the nine Britons currently in Guantanamo Bay, the whole nation will rightly expect them to uphold those enduring British principles.

I rather got the impression that the hon. Gentleman was agreeing with the position taken by the British Government, but that he then had to invent several differences to nuance his position compared with ours. The context of the detentions was well illustrated by one word that he used: he said that the detainees' position was "unique". Let us be clear that 11 September 2001 was not only absolutely terrifying, but unique due to the nature of the threat that it posed and because it exposed western democracies and the whole of the civilised world to threats of a kind that we had never previously had or properly anticipated. That creates the context in which those people and the other detainees at Guantanamo Bay have been held.

The hon. Gentleman asks about the difference between those who are to be released and those who will remain in Guantanamo Bay. I do not wish to prejudice in any way the positions of either, except to say that there have been fewer difficulties with negotiations in respect of those who are to be released than of those who will be detained.

The hon. Gentleman asks whether the individuals will pose a security threat. That is a matter for the police, in the first instance, acting under powers that they have generally and also under powers that the House recently gave them through the Terrorism Act 2000, as amended. As I made clear in my statement, the police have it open to them to detain and interview the individuals when they arrive. There is a short time for which they may be detained at the behest of the police, and a longer period—up to a total of 14 days—if that is approved by the court on application. Any further question of proceedings will be a matter for the Crown Prosecution Service.

The hon. Gentleman asks about the admissibility of evidence. One does not need advice from the Attorney-General about rules on evidence in the British courts because they are available to anyone who cares to read them, and well understood. I did not ask for that advice, and neither did I receive it, because I did not need it.

The hon. Gentleman asked me about the hare that has been running about charges of treason against these individuals. As with any other charge against them, that is a matter for the Crown Prosecution Service, and I think in respect of treason it is also a matter for the Attorney-General. I merely place on record that I think the last time there was a successful prosecution for treason was getting on for 60 years ago, against Lord Haw Haw.

The Foreign Secretary is entitled to claim that his announcements today and last week are evidence of progress, but not a solution. So far, the Government have, with some success, put their trust in patient diplomacy, but I hope that the Foreign Secretary will not rule out rightful indignation if that becomes necessary, because if the situations were reversed and the United Kingdom proposed to deal with American citizens by way of military commissions, without due process, the outcry from the White House and from Capitol Hill would be prolonged and deafening, and rightly so.

The Foreign Secretary says that it is not appropriate to comment on individual cases, and as a matter of principle, of course he is correct. When the Home Secretary said that the five being released were no threat, did that represent the considered view of the Government? Even if the Foreign Secretary is unwilling—or perhaps, more correctly, unable—to answer that, does he accept that it raises very sharply this question: if they are no threat, why have they been incarcerated for so long?

Finally, if the United States Government persist in putting United Kingdom citizens on trial in circumstances unacceptable to the Foreign Secretary, the Prime Minister, the Attorney-General, Parliament and the British public, what then is the Government's solution?

First. I accept that we have made progress but have not resolved this matter. As I made clear, and as my right hon. Friend the Prime Minister has repeatedly made clear, we want those individuals to be subject to a trial that meets internationally accepted norms and standards, or we want them brought home. That applies to all nine, regardless of the allegations against them, and not just to the five.

The right hon. and learned Gentleman commented on patient diplomacy. I believe that that is the way to resolve these matters. The House is very alert, as it should be, to our standards of justice, as I have to say generally the Americans are, too, but we have to take account of the context in which the detentions took place. That context was that a terrorist organisation of a sophistication and ruthlessness never previously seen in our history, and without any political programme with which one could negotiate, decided effectively to start a war, not just against the United States, but against the whole of the civilised world. Although colleagues may not necessarily agree with the approach of the United States, it is understandable that it has taken the action that it has. Our discussions with the United States Government have borne fruit so far with progress, but not with a solution.

The right hon. and learned Gentleman asked about the remarks of my right hon. Friend the Home Secretary. I think that my right hon. Friend sought to clarify those remarks on the radio this morning, when he pointed out that he was talking about what in his judgment had been assessed so far as regards the past, and that he was not seeking to make a judgment about decisions by the prosecuting authorities or the police on the arrival of those concerned.

Finally, the right hon. and learned Gentleman asked what would happen if those people were put on trial under unacceptable conditions. I hope that we do not come to those circumstances, because we have made it clear that we believe that any British citizen—we believe this generally, but I am speaking now of our immediate responsibilities—should be tried only by internationally accepted standards and norms.

I very much welcome my right I hon. Friend's statement and his previous statement, and the efforts of the Attorney-General and the Prime Minister to ensure both a fair trial for, and the return of, British detainees, while guarding our national security.

My constituent, Feroz Abbasi, will not be sent home. Can my right hon. Friend confirm that the reason is perceived risks to the public interest, based on intelligence reports? If that is the case, does my right hon. Friend accept that new powers available to the Government to protect people under the Terrorism Act 2000 and, indeed, the Anti-terrorism. Crime and Security Act 2001, mean that if Feroz Abbasi were on the street and put a foot wrong by association or sympathy, whether direct or indirect, with future or past terrorist acts through, for instance, a phone call or wearing a badge, he could immediately be arrested, charged and imprisoned? If he were released, he would be better off, as would the other detainees, writing his memoirs of Guantanamo Bay. That would be much more in his interest and that of al-Qaeda than posing a future risk to the British public.

I should like to applaud the assiduous way in which my hon. Friend has sought to represent the interests of his constituent and his family, who are understandably concerned about Mr. Abbasi's future. As I have already told the House, I am not going to offer views about the perceived risks posed by any of the individuals concerned because, by definition, that could have the effect of prejudicing future proceedings. As for new powers under terrorism legislation, the Terrorism Act 2000, which I introduced as Home Secretary, strengthened police powers, and legislation passed in 2001 by the Commons and the House of Lords has strengthened them further. However, to make a general point to my hon. Friend without specific reference to the detainees, those powers apply only where the police have evidence against individuals. It is the nature of terrorists, even more than ordinary criminals, to go to the most extensive lengths to avoid detection, not just at the point of committing acts of terrorism but prior to that by avoiding coming to the notice of the intelligence community. That is a basic challenge that the intelligence community and the police face in fighting terrorism.

My constituent, Martin Mubanga, is one, of the four remaining detainees in Guantanomo Bay, and I met his family last night. Is the Minister aware of their distress? They have had no information about why he was detained, they have received very few letters, and those that they have received have been censored. Indeed, they have received no information at all about his basic well-being since the Foreign Office visited in September, and their pain has been compounded by the welcome; homecoming of the initial five. Most damningly, perhaps, they told me that they find it easier to get information about their son's well-being and his case from the newspapers than from the Foreign Office, which is worrying. What are the Government doing to ensure that families such as Mr. Mubanga's receive basic information about their relatives' well-being? Can letters be transmitted to the family, and can basic information about why Mr. Mubanga was detained be made available to the family ahead of the newspapers?

Of course I understand the families' distress. As negotiations reached a final stage last Wednesday and Thursday, I was all too conscious of the fact that five sets of families and a wider group of relatives and friends would be very pleased about the announcement, but that four sets would be distressed. It was for that reason, among many others, that I ensured, as far as was humanly possible, that the families and the Members representing them were contacted before I made a public announcement.

I entirely resist the criticism that the hon. Lady made at the end of her remarks, when she sought to criticise either me, as the person responsible, or my officials. Foreign Office staff have made every effort to pass on in detail information to the families as soon as it arrives, and we will continue to do so. It has not been sufficient, but we have had more contact with our detainees than, as I understand it, any other Governments have had with their nationals who are detained.

The issue of letters is one of concern, and we will continue to take it up through the International Committee of the Red Cross. I am happy to meet the hon. Lady to discuss further what other measures we can take.

May I reiterate our thanks to the Foreign Secretary for his efforts to secure the release of the five detainees, three of whom are from my constituency? I thank him, too, for informing the families beforehand, as that was very much appreciated.

I welcome my right hon. Friend's comments that on their return the detainees will undergo a thorough police investigation and that any subsequent trial will conform with internationally accepted standards of justice. That is necessary both to reassure the public in this country and to give the detainees an opportunity to answer properly any charges against them.

My right hon. Friend will be aware, however, of the acute anxiety that the families have experienced over the past two years. They are obviously desperate to see their relatives again. Can he assure me that every effort will be made to keep the families informed at every stage of the proceedings, and that they will have the earliest possible access to their relatives, commensurate with national security?

I commend my hon. Friend for all his efforts on behalf of Mr. Ahmed, Mr. Iqbal and Mr. Rasul, who were resident in his constituency. He, too, has been careful and assiduous in his representation of those individuals, who are three of the five to be released. As I told the hon. Member for Brent, East (Sarah Teather), of course I understand the distress and anxiety of the families. It would be astonishing if they were not distressed and anxious about their loved ones in the circumstances. That is why we have made every effort to maintain welfare visits to the individuals and keep the families informed.

As for the future, there will be a period before the releases. I am sorry, but I cannot say exactly when they will take place. I said on Thursday, and it remains the case, that they will take place within a few weeks. Within that time scale, I hope that it is sooner rather than later. As information becomes available and we can release it, we will make it available to the families first.

I am sure that the right hon. Gentleman will accept that I am a long-term friend and admirer of the United States, a country with which I have close family ties. However, I regard the detention and treatment of the detainees in the Guantanamo Bay camp as a lamentable departure from the rule of law and wholly inconsistent with the fine traditions of the United States. Does the right hon. Gentleman accept that that view is widely shared in this country and, if he does, will he ensure that the United States Administration understand that and recognise the damage that they are doing to their reputation?

The right hon. and learned Gentleman's opinions on this matter are well known, and although such feelings are not nanimous—opinions differ greatly—I assure him that the United States Government are fully aware of the strength of opinion on the issue.

May I, too, pass on my thanks to the Foreign Secretary for the keen attention that he has given the matter over the past two years and his courtesy last week in making sure that the families and their Members of Parliament were informed? As he is aware, my constituent, Jamal al-Harith, is one of those who, happily, will be released, but I share concerns expressed by Members on both sides of the House about the events of the past two years and, indeed, the future facing the four who will not be released. Such action may be understandable in emotional terms, but it is not acceptable in terms of legal propriety. My constituent experienced a form of kidnap, and naturally the family were extremely unhappy about that.

I know that my right hon. Friend will not want to go into great detail, but there are issues about, for example, access to legal representatives, to the families, which is important, and perhaps to qualified medical staff. Can he assure me that those will be immediately available to individuals on their return to the United Kingdom?

I am grateful to my hon. Friend for his remarks about the way in which the matter has been handled. It is a difficult situation, and again I would like to put on record my appreciation for the way in which he has performed his duty in representing his constituent and his family.

My hon. Friend asked me about access to legal representation, the availability of qualified medical assistance and—a point that was also raised by my hon. Friend the Member for West Bromwich, West (Mr. Bailey)—access by families when they arrive here. The Terrorism Act 2000, as amended, provides powers to the police, where they have grounds for doing so, to detain terrorist suspects and to interview them for an initial period of two days, which can be extended, through successive applications to a court, to 14 days. However, as is absolutely right, subject to what is laid down in law, individuals have access to lawyers, as well as to their families. There are constraints on that, but they are the normal constraints for suspects who are suspected of any terrorist-related activity under the Terrorism Act, as amended.

On medical assistance, we shall make sure that that is available.

I am sure that the Foreign Secretary is aware that there is also concern in American legal circles about the treatment of people in Guantanamo Bay. Some feel a sense of rage that within great democracies that generally obey the rule of law, individuals can be locked up for two years, during which time the authorities have been unable to formulate charges or the basis of a trial that would sustain itself in front of what we recognise as proper legal process.

I understand the hon. Gentleman. We must appreciate, however, that the United States saw itself as literally in a war situation—as, indeed, did the rest of the civilised world. In such situations, people are detained without trial. We did that ourselves during the last world war. These matters are difficult and uncomfortable, but they occur where civilisations and countries feel themselves to be under great threat. That is simply a reality.

That said, we have made progress in respect of the detainees, five of whom are being transferred to the United Kingdom to be dealt with in accordance with the normal processes of the law. I can promise the hon. Gentleman and the House that we will continue our efforts satisfactorily to resolve the position of the other four, although I cannot say when that will happen.

While I welcome the extremely belated forthcoming release of these men, is it not a fact that the United States has no jurisdiction whatever by which to have detained them, or anybody else, in Guantanamo Bay; that it is utterly characteristic of the Bush regime to behave in any manner that suits it, regardless of international law; and that my right hon. Friends must not allow this Government to be tainted by association with such conduct?

I understand my right hon. Friend's remarks, but he will forgive me if, in the interests of what the right hon. and learned Member for North-East Fife (Sir Menzies Campbell) described as patient diplomacy, I do not fully subscribe to them.

As the Foreign Secretary rightly pointed out, nearly all the detainees were apprehended in the war zone, some were with armed groups, and some were actually putting at risk allied coalition soldiers. However, as the main coalition partner of the United States, surely this country could have been trusted to have the nine British detainees brought here in the first place. After all, in 1945 all French citizens fighting in German uniform, particularly those in SS units, were processed in France, not in Britain or America. There must be a lesson to be learned from that.

The hon. Gentleman echoes my point about war situations. However, what happened in France in 1945 took place after a war had finished. Let us be clear that so far as the United States is concerned—and us, too—this has been verging on a war situation with al-Qaeda and its related terrorist organisations. Let it not be forgotten that less than three months ago, at the end of November, both the British consulate general and the HSBC bank in Istanbul were bombed, with a severe: loss of life among British citizens and representatives, as well as Turkish citizens and others. That was a result of terrorism by al-Qaeda and its related organisations.

We are therefore in this very difficult, unique situation, and in such circumstances new measures are likely to be used. Our view is clear, and we have made it clear all the way through—it is that of course people should be detained in accordance with international law. The United States Government are clear in their own mind that there is a legal base for the detentions at Guantanamo Bay. Our position is also clear in that any trials that take place must take place in accordance with internationally accepted standards and norms.

Is my right hon. Friend aware that although the United States accepts that there is a legal position for these people to be in Guantanamo Bay, no other country in the world accepts that situation? It has created a new class of people captured on the battlefield-unlawful combatants—that is not recognised in any of the international agreements.

Does my right hon. Friend accept that while he may find the attitude of the United States understandable, many of us find it, if understandable, unacceptable? The Government must vigorously pursue this important matter. Although I welcome the release of the five prisoners, it has taken us two years to free people who have been held with no legal status, contrary to all the rules of international behaviour.

Of course I understand, to use the same verb, the very strong feelings of my hon. Friend on this issue and the fact that he does not accept the position as described by the United States Government. There is a great debate about the international legal basis for the detentions at Guantanamo Bay. I simply remind the House that the situation was not unusual: it was unique. Therefore, it is not surprising if the conventions and treaties that are the basis of much international law did not anticipate such circumstances.

I very much welcome the forthcoming repatriation of the five detainees in the next few weeks, which I suspect is to do with the possible involvement of the police and the Crown Prosecution Service. One has to say, however, that if they did have any relevant information or evidence, surely it would have been elicited from them by now. Will the Foreign Secretary redouble his efforts to ensure that the United States is aware of the concern on this side of the pond about the other four detainees and the need for them either to be charged, to be put before a properly constituted court recognising international standards of law, or to be released? It is a disgraceful situation, because these men have already served the equivalent of a four-year sentence without trial.

The United States Government are very well aware of the strength of feeling of the British people—although that varies—and of the different strains and strands of that opinion. I have discussed the matter on numerous occasions with United States Secretary of State Colin Powell and with many others inside the United States system. My right hon. Friend the Prime Minister has discussed the matter on several occasions with President Bush and the United States Government. It has been discussed at every level between Governments. The United States Government are aware of the feeling that exists, and I am sure that they will become more aware of if when the contents of this statement and my answers are drawn to their attention.

In order to keep a sense of balance, does my right hon. Friend agree that we should always bear in mind the shock that was felt throughout the whole of the United States—it was certainly not confined to President Bush and his circle—over the outrage on 9/11? On the Friday of that terrible week, I went to a huge demonstration in Philadelphia, where political views of all kinds were expressed over the terrible and wicked events that had occurred.

In welcoming what my right hon. Friend has said about the four detainees, is it not important for the United States to appreciate that those of us who do not minimise the dangers of terrorism, and who understand only too well the constant danger to all the democracies, remain very uneasy over the way in which these detainees, not only those who are British, are being held; and that domestic and international law should always be applied, even when it is dealing with those who are responsible for the most terrifying crimes against humanity?

My hon. Friend puts his view in a balanced and measured way.

The Foreign Secretary should know from correspondence with me about the case of my constituent Mr. Bisher Al-Rawi who is detained in Guantanamo Bay. He had lived in the United Kingdom for 19 years, from when he was a child. His family are all British citizens but he holds an Iraqi passport. So far, the Foreign Office has refused to make any representations for Mr. Al-Rawi. Will the Foreign a Secretary reconsider that? Does he recall that Mr. Al-Rawi was not arrested as a combatant but detained while on a business trip to the Gambia? Given the unusual circumstances, is the Foreign Secretary prepared to meet me and the Al-Rawi family to ascertain how the UK Government could assist my constituent?

I am happy to see the hon. Gentleman. There are five individuals in Guantanamo Bay who are not British citizens but were British residents before their detention, and his constituent is one of them. Their legal position is difficult. We simply do not have a right in international law to make representations on behalf of those who are not British citizens. That is standard and accepted practice. [Interruption.] Well, that is the case. Although I understand the point that is being shouted at me from a sedentary position, I have outlined what happens to be the case. That standard is accepted in all diplomatic relations. However, some organisations, including the International Committee of the Red Cross and the United Nations High Commissioner for Refugees, may be able to help. I am willing to meet the hon. Gentleman and, following that meeting, to decide what further action we can take.

Extreme forms of terrorism pose a serious and complex problem to democratic societies. To impress on the United States the dangers of its Guantanamo Bay policy, will my right hon. Friend remind that country that, in the 1970s, as a good friend of this country, it warned us of the dangers of internment in Northern Ireland? It was right to warn us then and we are right to warn it now.

My hon. Friend makes an interesting and nice point.

A moment ago, the Foreign Secretary prayed in aid the internments that took place at the beginning of the second world war. They were subsequently widely held to have been a mistake both in the United States, where Japanese were detained, and the United Kingdom. I hope that the right hon. Gentleman keeps that point in mind when he talks to his American counterparts.

Have the Government assessed the effect of Guantanamo Bay on global public opinion and the damage that it does to the values that we are seeking to export? Will the Foreign Secretary state unequivocally that the Government consider Guantanamo Bay to be contrary to international law? What representations to that effect has he made to the United States Administration?

I made the point about internments in the second world war to remind the House that in war situations—and quasi-war situations—otherwise unacceptable and uncomfortable measures sometimes have to be taken. It is all very well for the hon. Gentleman to say that the internments in the second world war were later regarded as a mistake. That is true of their scale but not necessarily of everybody who was detained. However, I put that to one side. I simply wanted to bring out the point that we must better understand why the United States felt it necessary to take such action.

Let us be clear: the information that has been obtained from a good many detainees in Guantanamo Bay has helped to make the world a safer place—safer for us and our constituents as well as for the United States and those in other countries. That is the position.

Does my right hon. Friend agree that the detention of 2,000 prisoners for two years without trial cannot be justified or condoned in any circumstances? Does he also agree that the imprisonment for 14 months of three Afghan children, who were afterwards given one football each as a gesture, is a blatant violation of international law?

I am afraid that I have not had sight of the case of the detention of the three Afghan children. I am happy to follow it up with my hon. Friend.

On the wider question, it is obvious that the sentiment of the House is as stated. It is similar to that of the Government: individuals who are detained should either be brought to trial in accordance with internationally accepted standards or returned, in this case to the United Kingdom. We shall continue to follow that policy.

I congratulate my right hon. Friend and the Attorney-General on all their efforts behind the scenes to achieve the result so far. However, there is considerable disquiet about the four young lads from Tipton and separate arrests in my constituency under the Terrorism Act 2000. The majority sentiment—a view that I share—is that when offences have been committed, people have to account for them. However, given the disquiet, will my right hon. Friend talk to colleagues so that decisions can be made and resources allocated to enable the police and the prosecution authorities to fast-track those cases if there are to be proceedings under the Terrorism Act against the returnees and more generally?

I am grateful to my hon. and learned Friend for his thanks and I shall ensure that they are drawn to the attention of the Attorney-General, who has played an important part.

Of course, there will always be concern among those who are arrested under the Terrorism Act 2000 and their families about their nature of their arrests, but the Act was approved in the House four years ago on an all-party basis because of the emerging threat that we assessed. Prevention of terrorism legislation at the time was defective because it was only effective in protecting our communities against Irish terrorism, not the new forms of international terrorism. Individuals suspected of terrorism correctly have clear rights under the legislation.

I accept my hon. and learned Friend's point about resources. If the individuals come back and are subject to prosecution, it would be reasonable for their cases to be fast-tracked, given the lengthy detention that they have already had to endure. I will draw that suggestion to the Attorney-General's attention.

I beg to move,

That leave be given to bring in a Bill to prohibit the sale of high fat and high sugar content food in vending machines in schools.

I appreciate that I am not the only parliamentarian who is this week seeking to curb children's consumption in schools, but I hope to persuade the House that my proposals are well researched, evidence based and have widespread support. Indeed, the Bill has the support of the National Union of Teachers, the British Heart Foundation and the Royal College of Physicians and is the product of my conducting a lengthy investigation into obesity with the Select Committee on Health. Other countries have tried similar measures or variants on it.

Only last week, a joint working party of the Royal College of Physicians the Royal College of Paediatrics and Child Health and the Faculty of Public Health called for the

"replacement of sugar drinks and high-calorie snacks with healthy alternatives in schools"

and warned that

"failure to act now will have severe consequences for millions of individuals, for the nation's health and for the health service."

The can that I am now displaying is familiar to everyone since it is the most famous brand in the world. I am sure that all Members of Parliament know that its contents are carbonated water which contains sugar. However, I doubt whether hon. Members realise just how much sugar is in that can. Depending on whether we use American or British teaspoons, it contains seven to 10 teaspoons of sugar. We know that many children drink three or four such cans in the course of a day. What responsible parent would permit their child to take 28 teaspoonfuls of sugar in one day? Yet in our schools, children are given the means, the opportunity and the time to do just. that.

There is evidence that parents are worried about this. An ICM poll in The Guardian last year showed that 70 per cent. would support the banning of fizzy drink vending machines in schools. In an era in which parents and health professionals are increasingly worried about obesity and nutrition. junk food in schools is rapidly becoming an anachronism.

The past 20 years have seen a startling rise in the proportion of children 1 who are overweight or obese. Since 1982, the number of such children has more than doubled, and 10 per cent. of today's six-year-olds are obese. The chief medical officer for England has called childhood obesity a "public health time bomb". If present trends continue, at least one fifth of boys and one third of girls will be obese by 2020. According to experts, that is the conservative estimate.

Children who are overweight or obese tend to become overweight or obese adults, leading in the long run to high blood pressure and other health problems. Obese children are far more likely to develop type 2 diabetes. An American survey has shown that severely obese children have a 93 times greater chance than average of developing diabetes. A long-term study of 51 Canadians who were diagnosed with that type of diabetes before the age of 17 showed that by the age of 33, seven of them had died, three were on dialysis, one was blind, one had had a toe amputated and out of 56 pregnancies in those people, only 35 had resulted in live births. Those statistics should be sufficient to Show that childhood obesity must be taken very seriously.

I do not claim that vending machines in schools are the only, or even the primary, cause of the problem. The rise in childhood obesity clearly reflects broader changes in lifestyle and diet in our society. However, vending machines whose primary products are fizzy, sugary drinks, crisps and chocolate—which the Americans describe with the term "foodstuffs of no nutritional value"—are a clear example of how schools, and by extension the state, allow the problem to go unchecked and are seen to promote and encourage those products. The fact that we cannot do everything to solve the problem at once does not mean that we should do nothing.

I have just mentioned America. Several US states and school districts have proposed or passed legislation similar to this Bill. I hope that the problem of childhood obesity in Britain will not have to reach US proportions before we take such measures here. All over the world, people are considering such proposals. In Canada, from September this year Coca-Cola and Pepsi will remove all their fizzy drinks from vending machines in schools and replace them with healthier products. I am sure that they are doing that to pre-empt legislation. In this country, Coca-Cola has just announced that it will remove all advertising on its vending machines in schools. It is clearly worried about what the Government might do, and I hope that it has good reason to be.

The food and drink industry does not make sizeable profits from vending machines in schools, but those machines raise the profile and familiarity of the industry's products with children and adolescents. Children are already disproportionately targeted by advertisers of fatty, sugary and unhealthy foods. Indeed, 40 per cent. of all adverts shown to children on television are for those products. Whether such adverts should be banned is a matter for another day, but to allow those brands into our schools—to allow the work done in the classroom to be undone in the corridor—is to take a desire to avoid accusations of nanny statehood to a ridiculous extreme.

Banning junk food in school vending machines will not turn us overnight into a nation of superhuman children, bursting at the chance to win Olympic golds; if only things were so simple. However, it is a step that we can take. When I was at school, I was exposed to much old-style Welsh nonconformism. To paraphrase what I was told then, just because we have junk food sellers does not mean that we have to have junk food sellers in the temple. It is time to throw them out.

Question put and agreed to.

Bill ordered to be brought in by Mr. Jon Owen Jones, Mr. David Amess, Paul Flynn, John Austin, Ms Debra Shipley, Dr. Richard Taylor, Mr. Win Griffiths, Mr. Bob Blizzard, Mrs. Jackie Lawrence, David Taylor and Chris Ruane.

I beg to move,

That the draft Social Security Benefits Up-rating Order 2004, which was laid before this House on 4th February, be approved.

With this it will be convenient to discuss the following motion:

That the draft Guaranteed Minimum Pensions Increase Order 2004, which was laid before this House on 22nd January, be approved.

I am satisfied that the orders are compatible with the European convention on human rights.

On uprating, I can confirm that national insurance benefits will rise in line with the retail prices index, which is 2.8 per cent. Most income-related benefits will rise by the Rossi index—1.8 per cent.—in the normal way. That will add more than £2 billion of extra Government spending to help those in most need and to tackle poverty. Of the £1.2 billion extra for pensioners, £140 million is above price inflation, as is £180 million of the extra for children.

In 1997, we said that we would cut the costs of economic and social failure—and we have. Despite the downturn in the world economy, employment in the United Kingdom has continued to grow. We have more people in jobs than ever before and, for the first time in nearly half a century, the highest employment rate and lowest unemployment rate of the major industrialised countries.

Through our investment in the new deal and Jobcentre Plus, we have tackled the legacy of mass unemployment that we inherited from the Conservative Government, whose leader, when masterminding their employment strategy, increased unemployment by more than 1 million. Since 1997, we have increased the number of people in jobs by more than 1.5 million, and we have invested to tackle poverty the £5 billion that has been saved from the cost of unemployment.

Combining that amount with the savings from tackling benefit fraud and error—overpayments alone now cost £400 million less a year than was the case in 1997—we can ensure that more money is available to invest in services. Staff working for the Pension Service, the first ever dedicated service for pensioners in this country, have made more than 300,000 home visits and held more than 220,000 community-based surgeries. Our investment in Jobcentre Plus is helping to deliver the lowest unemployment in the G7. Each day, our offices receive 13,000 vacancies, conduct 36,000 work-focused interviews and help 4,700 people into jobs, including more than 400 lone parents and more than 120 incapacity benefit clients. So we are not only uprating benefits but upgrading the service that we are able to give to our clients.

Our tax and benefit measures, combined with our successful employment policies, are helping to get more parents into work. We have reversed the generation-long trend of rising child poverty, which more than doubled during the 18 years when the Conservatives were in power. Since 1997, we have reduced the number of children living in low-income households by more than 500,000, and we are determined to do more. From April, the child element of the child tax credit will rise by £180 to £1,625 a year equivalent to a weekly increase of £3.50. That will benefit 7.2 million children, including all families on income support and jobseeker's allowance.

Building on these measures, I announced in December how we would judge longer-term progress towards our ambition to eliminate child poverty altogether. The new measure recognises that poverty is about more than money. We will strive to eliminate material deprivation entirely, but we are also firmly committed to keeping up the drive to increase the incomes of the poorest children right through to 2020. Let us remember that in 1997, the Tories left us bottom of the European child poverty league table. As a result of the measures this government have introduced, the UK has already moved four places up that table, and we are committed to go further so that we move beyond the EU average to be among the very best in Europe.

What of the Conservatives? We need to know whether they share our ambition that no child should be left behind, or whether they plan to repeat their performance of the 18 long years during which child poverty more than doubled.

On pensions, we are taking action to tackle pensioner poverty, boost security and provide people with more choice about when they retire. This year the basic state pension—the foundation of pensioners' incomes—will rise by a further £2.1 5 a week. That is £111.80 a year, which more than meets our guarantee that future rises will be at least £100 a year for single pensioners.

On pension increases, can my right hon. Friend make a comparison in monetary terms and percentage-wise between 1997 and now so that the House can get a good idea of the increases since then? How do they compare with the record of the previous Conservative Government?

The truth is that the Conservatives increased the real value of the state pension only once. That was at the time when they put VAT on fuel. If ever there was a case of giving with one hand while taking away with the other that was it. In total, the real increase in the state pension since we came to office is now more than £5 a week for a single pensioner and more than £8 a week for a couple.

The Minister has moved on from his laudable aim of ending child poverty by 2020 to talk about pensioners. Is it his aim to end pensioner poverty, and if so, by when?

We have already set out our ambition to erode and remove those aspects of pensioner poverty that we inherited from the Conservatives, and we are making enormous progress in that endeavour, thanks to increases in the real value of the basic state pension and to the introduction of pension credit, the impact of which I shall come to in a moment. The hon. Gentleman will know from the statistics that we have already cut the pensioner poverty that we inherited by some 60 per cent. in absolute terms. Even in relative terms, at a time when median incomes have been growing quite rapidly—so this is quite a demanding test—more than 500,000 pensioners have moved out of relative poverty. Of course we are committed to driving that forward.

The Secretary of State is telling us how the Government wish to treat pensioners and about their laudable aim in that regard. Can he tell us how many pensioners were threatened with prison sentences under the previous Government —[HON. MEMBERS:"Hundreds."] How many does he anticipate being threatened with prison sentences for not paying their council tax under this Government?

My hon. Friends suggest that hundreds, if not thousands, of pensioners were threatened with prison when the hon. Gentleman s party imposed the poll tax on them. If he is alluding to recent reports in the press, I am sure that he will understand that I am not at liberty to go into the individual circumstances of any recipient of pensions or benefits, no matter how much publicity those circumstances have received. I can assure him, however, that in that particular case, as in others, every endeavour is being made to ensure that the pensioner in question receives in full the entitlements that are her due. If some reports are to be believed, that has clearly not yet happened, for whatever reason. I am sure that the hon. Gentleman would agree with me—I see him nodding—that pensioners should gain their pension credit, their council tar benefit and their housing benefit whenever they are entitled to do so.

Without my going into that individual case in any more depth than the Minister for Local and Regional Government already has, if it is right, as has been suggested, that that pensioner would not have had to pay any council tax, or would have had help with it, through council tax benefit, does not that underline the massive failure of council tax benefit having the lowest take-up of any means-tested benefit, and the underlying problem of the growth in mean-tested benefits under this Government?

I have already said how important it is that all pensioners and others get the help to which they are entitled. This time last year, Opposition Front Benchers questioned us about the work of the local Pension Service, asking whether people who needed a home visit would be able to get one. They have gone quiet on that now. There have been 300,000 home visits, and more than 220,000 surgeries. Never has so much effort gone in to raising the take-up of people's entitlements. When the Conservatives were in Government, they seemed to operate an effective target of keeping take-up as low as possible. There is a big contrast between that and the effective that we are putting in and the impact that they are having.

We have recognised that more needs to be done to improve the take-up of council tax benefit. That is why an information and advertising campaign is due to start shortly, as well as the extra advice being given through the local Pension Service. Thanks to the introduction of pension credit, 1.9 million pensioners are receiving help with housing benefit and council tax benefit for the first time, or getting significantly more than they were before. We recognise that more needs to be done, but we are making good progress.

The case to which my right hon. Friend referred, which has received so much publicity, needs to be spelled out in a bit more detail so as to alert people to the need to read more carefully what is in their newspapers. The story sounded largely untrue when I saw the figures involved, and it transpires that the lady involved is withholding her council tax because of an objection to certain aspects of the European Union. She has been supported in that by the United Kingdom Independence party, which has involved Max Clifford in handling the publicity. She is also receiving £10,000 from the Daily Mail for her story. Had the story in the press that she was receiving only £312 a month been true, she would clearly have been receiving less pension than she was entitled to, and would also not have had to pay any council tax anyway. So nearly all that story was untrue—

Order. The hon. Gentleman is an experienced Member of the House. This is becoming a statement rather than a question.

I, like the rest of the House, got the thrust of what my hon. Friend was saying. I am not in a position to comment on some of the alleged aspects of the circumstances that he has drawn to our attention, but what 1 said previously still stands. Notwithstanding all that, and whoever is representing or supporting that pensioner, she is entitled—like anyone else—to the entitlements that are properly her due.

The Secretary of State said that he would not comment in detail on that case. We have just heard the hon. Member for Ealing. Acton and Shepherd's Bush (Mr. Soley) claim that that woman has received £10,000 from the Daily Mail and that she is employing Max Clifford. The hon. Gentleman made a variety of allegations about an individual pensioner facing a problem with her council tax. Does the Secretary of State agree that it is most regrettable that those remarks have been made about an individual who, as far as we understand it, is wrestling with council tax demands that she finds it difficult to meet?

I wonder whether it is wise for the hon. Gentleman to repeat the circumstances that he said should not be aired in the House, and whether the deputy Chief Whip of the Conservative party should have raised the matter in the first place. It would be best to get back to pension credit and its uprating.

On a point of order, Mr. Deputy Speaker. I am sorry to intervene, but I must make it clear that what I said was not in any way a criticism of the pensioner, because she wanted it to be known that her objection was to paying towards an aspect of the European Union. That is the issue.

That is not sufficiently a point of order for me to comment on the matter. The hon. Gentleman has put his point on the record.

Further to that point of order, Mr. Deputy Speaker. I ask you to invite the Secretary of State to reflect on the words that he has just used, and on the fact that I talked about pensioners in general. I never mentioned a specific pensioner. It was the Secretary of State who referred to individuals.

That was no more a point of order than that of the hon. Member for Ealing, Acton and Shepherd's Bush (Mr. Soley). It is on the record, however.

I have taken careful note of what the hon. Gentleman has said, Mr. Deputy Speaker, and I am confirmed even more in my judgment that it would be wise to get on with the more general subject of the uprating of pension credit.

In April, in keeping with the Government's earnings link for poorer pensioners, the guarantee will rise again by more than £3 a week so that no pensioner need live on less than £105 a week and no couple on less than £160 a week. Already, more than 2.6 million people receive pension credit, with an average household award of £43.50 a week. That number is growing with every passing day. It is worth reminding the House that the poorest pensioners were expected to live on just £68.80 a week in 1997, and under this Government they will get an extra £36 every week. From April, the Government will spend £9 billion extra on pensioners as a result of measures introduced since 1997. That is almost £6 billion more than if we had just linked the basic state pension to earnings.

Our policies have not only been more generous than the earnings link, but also more progressive £7 of every £10 of pension credit goes to helping women, many of whom have been penalised by a basic pension that short-changed them on the time taken out of work to bring up children. With the introduction of pension credit, almost 1.9 million pensioner households will qualify for more help, or qualify for help for the first time, with their council tax or rent.

The poorest are gaining more under our plans. Those who urge us to scrap pension credit and use the funds to increase the basic pension must realise that their plans would cut the incomes of poorer pensioners by £30 every week. The progress that we are making stands in stark contrast to the Opposition's approach. Our approach is fair and fiscally prudent. Theirs is unaffordable, unsustainable and, above all, unfair.

We will also give people more choice about when they retire, by giving a much better deal to those who choose to take their state pension late. For the first time, people will be given the chance to build up a lump sum by deferring their state pension. I can tell the House today that that will be calculated using an interest rate at least two percentage points above base rate, which would mean 6 per cent. today. Therefore, from next year, a woman with just the basic state pension of £77 a week could start building up a lump sum worth £8,500 if she kept working at 60 and drew her pension just two years later, or a lump sum of £23,000 if she put off retiring until 65.

Most people have higher state pensions than that thanks to the state earnings-related pension scheme and the state second pension, and could therefore build up even bigger sums. On average, men retire with £100 in state pensions, which would allow a man working until 70 to build up a lump sum of more than £30,000, or for a couple, a lump sum of more than £48,000. In the past, lump sums have been the preserve of the fortunate minority with good occupational pensions. These proposals make them an option for everyone. As well as the lump sum, our reforms will offer those who take their pensions late the alternative of a pension for life that is very significantly higher. Someone working an extra five years with typical weekly state pension entitlement of £100 will be able to increase that to £152, with inflation additions on top. The whole thrust of the proposals is therefore to give people new and attractive options to work beyond 65 when they want to.

Will the Secretary of State clarify whether the lump sums that he has just described will be taken into account if pensioners claim means-tested benefits, or whether they will be wholly disregarded?

As we have made clear, the principle behind the policy is that people will not be disadvantaged throngh taking the lump sum rather than the increment. The detail by which we will do that on pension credit will be set out in due course, just as the detail of how we will meet the goal on taxation will be set out by my right hon. Friend the Chancellor of the Exchequer. I hope that the hon. Gentleman and his party, and other parties in the House, will see the merit of these proposals in extending the opportunity of genuine, worthwhile choice to people, and in giving a much fairer deal to those who choose to defer taking their state pension. I emphasise choice—that is what this must be about. Together with our plans to stamp out age discrimination and to allow people to work part time while drawing a pension, these initiatives will encourage many people to work into later life, and all of us will benefit from their contribution.

I stress, however, that working beyond 65 must remain a matter of choice. It is not something that can be forced on the least well off. We therefore reject calls to put up the state pension age. Instead, we want to give everyone the choice to boost their pension by working for longer when it suits them to do so.

The measures before the House will benefit a large number of children, parents and pensioners. They carry forward our reform of the welfare state and our mission to tackle all forms of poverty. Through investment and reform, getting record numbers into jobs and tackling fraud, we are able to target extra resources for children and pensioners who need help most. The orders help us build a Britain that fulfils potential, opens up opportunity and tackles poverty, and I commend them to the House.

I am sorry to take away some of the drama from this potentially very significant debate, but let me begin by assuring the Secretary of State that it is not the Opposition's intention to vote against the proposed uprating of benefits. We all still remember the year when the Liberal Democrats did that, trying to deprive their constituents of any increase in their benefits, and we will not make that mistake. Of course, we welcome the uprating that is being proposed, but I want to ask the Secretary of State some specific questions about what he has just said.

First, the Secretary of State talked about poverty and the Government's proposals on child poverty. Is he at all embarrassed, however, by the evidence from the Government's own report, "Opportunity for all: fifth annual report", of the incredible stability in the number of people facing persistent low incomes? Between 1994 and 1997, 16 per cent. of children in low-income families faced persistent low incomes, defined as being below 60 per cent. of median income in three of the past four years. Between 1998 and 2001, the figure was also 16 per cent.

Sadly, there is similar evidence relating to people of working age. Between 1994 and 1997, 7 per cent. of working-age people living in low-income households faced persistent low incomes; the figure was also 7 per cent. in 1998 to 2001.

Why do the much-vaunted increases in benefit expenditure, and all the other measures described by the Secretary of State, seem to be having no impact on one of the things that the right hon. Gentleman says that he cares about, and which the Government have set as one of their objectives —the elimination of the persistent poverty in which people are currently trapped? This is the fifth annual report on poverty, but as yet there is no sign of any movement whatever. Conservative Members would like to hear from Ministers—instead of the usual propaganda—an honest explanation of why they are apparently not moving out of persistent poverty those who have been stuck in that position for far too long.

I can offer the Secretary of State a possible explanation. Many of the benefits for families have been lost to his budget, and are now pact of the Chancellor's tax credits. We find ourselves in an odd position: the structure of the tax credits for families does not match the measurement of poverty that the Secretary of State's Department used for the purposes of this document.

Given the definition of poverty with which we are saddled, if everyone in the country became a millionaire tomorrow the proportion of people in poverty would be the same as it is now. Can the hon. Gentleman exercise one of his many brains and suggest a better definition that would reflect the real situation?

I am not sure whether that follows, but I agree that if everyone had an extra £1 million, the proportion of people with below 60 per cent. of median income would remain the same. I am happy to accept the general, conventional assumption that that is the relevant measurement. There are many others—there are relative measures, absolute measures, measures that change over time and measures that do not—but the central measurement that the Government set when they first identified their child poverty target was 60 per cent. of median income. We will not allow Ministers to get away with changing the target: they should be judged in terms of that 60 per cent. measurement.

In what was perhaps a fruitless endeavour, I was trying to take the House through the finer points of equivalence scales in the measurement of poverty. This, in my view, is one of the problems faced by the Secretary of State. I am pleased to observe Ministers' rapt attention. The measurement of poverty used in the document reflects changes in family structure. If, for example, a household contains two adults rather than one, the income that it will need to achieve a given standard of living will be greater than that of a household containing one adult. Similarly, a household containing three children will need a greater income than a household containing only one. Equivalence scales are needed for the measurement of poverty. However, the structure of the child tax credit introduced by the Chancellor does not match the pattern of equivalent scales used by the DWP to measure poverty. The Chancellor is not using instruments that can tackle poverty as the Government measure it in their annual report.

I hesitate to interrupt the hon. Gentleman's lecture, but as he will have noted from our December publication on the measurement of child poverty, it has been proposed that we move to the OECD's basis for the equivalent scale. Does he agree with that, and what does he expect its impact to be?

I am happy for the Government to adjust their equivalence scales in line with international standards, provided that the Secretary of State undertakes to urge on the Chancellor that the structure of child tax credit, and the other tax credits he has introduced, also reflect more clearly the way in which all Members understand poverty and its effects on households with different structures.

One of the main reasons for the failure of the Chancellor's measures to reduce poverty is the fact that the Chancellor takes no account, in his structure of child tax credit, of the second adult in a household that contains a couple. Two adults receive no more child tax credit than one. When the Secretary of State for Work and Pensions measures poverty, he naturally expects a family containing two adults to need a higher gross income in order to achieve a given living standard than a family containing only one adult. Will he tell the Chancellor that his tax credit should reflect more accurately the way in which all of us here measure poverty? I should welcome an intervention from him if he wishes to respond.

If that change is not made, the Chancellor will not be able to meet his own child poverty objectives because he will be using instruments that do not reflect the way in which the Secretary of State's Department measures poverty. I should have thought that the Secretary of State would be able to stand up for the measurement that he has deployed for the past five years.

Get on with it!

I hope that the Secretary of State will indeed get on with it, and offer us some assurance. If he does not, he will not be able to abolish child poverty and the Chancellor's instruments will not achieve his objective.

The fact that the Secretary of State does not wish to intervene suggests to me that he knows there is a problem, but is not willing to assure the House that he will raise it with the Treasury and the Chancellor so that something can be done.

rose

We are fortunate enough to have with us the author of a valuable book on the whole subject of poverty and the measurement of child poverty. I should welcome an intervention from him.

I shall scrap the rather partisan intervention that I had planned and suddenly become statesmanlike.

The English translation of what the hon. Gentleman has just said is that the war on lone parents is back on. He says that the tax credit system does not provide extra money for the second adult in a two-parent family, and that the Chancellor should give more to two-parent families than to one-parent families; but he has also made an important point about persistent child poverty. I genuinely do not know the answer to this question: is persistent child poverty, which is the most worrying sort, more concentrated among one-parent families? If so, would not his proposed system give less priority to the severe and persistent poverty faced by children in one-parent families?

It is true that the problem of persistent poverty is more concentrated among lone-parent households. But it is also true that although lone parents are more likely to be poor, in absolute terms a majority of the 3 million-plus poor families are headed by couples. One of the Chancellor's problems is that his child tax credit is extremely harsh on families headed by couples. That is why he is making so little progress with his child poverty target.

May I return the discussion from its present academic level to a level that actually means something to people in communities? If the hon. Gentleman accepts, as he did in replying to the hon. Member for Northavon (Mr. Webb), that the problems for lone parents are more severe, how can he imagine for a moment that the Conservative party's commitment to abolishing the new deal for lone parents can do anything other than make that poverty worse?

I am pleased that the Secretary of State has mentioned that, because it gives me an opportunity to move from the measurement of child poverty to a second subject that I wanted to raise with him: the performance of the new deal and, more widely, the problem of economic inactivity. This is one of the paradoxes of the current Government. We remember all the arguments about the problem of worklessness when they were in opposition; there has been very little progress in reducing the number of workless households since 1997. We remember being accused of taking people off unemployment benefits and putting them on to disability benefits—but what do we see now? We see an increasing number of people on disability benefits and an increasing number claiming incapacity benefit. I have seen the figures

The hon. Gentleman should check his figures. If he does so, he will find that the inflow of people receiving incapacity benefit has fallen by a quarter since 1997.

The Secretary of State has made a serious mistake in raising this issue. The big problem that we face is people being trapped on incapacity benefit for longer and longer periods, and that is happening because the Secretary of State changed the rules in order to means-test incapacity benefit. As a result, if someone leaves incapacity benefit under the old rules, holds down a job for a while and goes back on to incapacity benefit, they do so on the new, means-tested basis. His changes have created a new obstacle to people leaving incapacity benefit because they are afraid that they will return to it on that new basis. We warned about that at the time, and I am afraid that the figures have borne out that warning.

How will the Conservatives' plan to abolish all new deals help people on incapacity benefit to get back into work?

I regard the new deal for disabled people as one of the more effective new deals. We have not said that we will abolish the new deal for disabled people. However, the Government's welfare-to-work programmes simply have not delivered what the rhetoric claims. Indeed, as recently as a few days ago, yet another report showed exactly how ineffective they are. The Policy Studies Institute's evaluation of work-focused interviews for lone parents showed that less than 1 percent. of lone parents taking part in that scheme had exited income support as a result of doing so. Page 12 of the report states that

"the introduction of Lone Parent Work Focused Interviews brought about no detectable change in exit rates from IS"—

income support—

"for eligible new or repeat claimants".

The Department for Work and Pensions' evaluations of new deal projects and compulsory interviews regularly show that many such interventions have minuscule, and occasionally even negative, effects. However, instead of learning the lessons and redesigning his policies, the Secretary of State endlessly repeats the same rhetoric. He ought to discuss with the House why, for example, many of these compulsory interview processes are simply not getting lone parents into work and improving their performance. That would be a valuable debate, in which we would be very happy to participate.

Perhaps I might ask the Secretary of State about a third issue—housing benefit. I have some sympathy with the aim of reforming housing benefit. I shall watch with interest the results of the pilot projects that have already been launched. However, it is a pity that we have heard so little from Ministers about how those pilots are going, and I should be very grateful if the Minister for Work could say something in his wind-up about the envisaged future shape of housing benefit reform. I also wonder whether he has anything to add to what we have heard, for at least the past two years, about the piloting of schemes for standard payments. Housing benefit is crying out for reform and it is time that the Government gave us a progress report on their thinking on the subject.

I invite the Minister for Work to tell us a little about the state of Child Support Agency work. We have read reports of continuing problems with the new computer system; indeed, it was even claimed—I am not sure whether the claim was based on an accurate interpretation of what the Secretary of State said to the Select Committee—that the Government had encountered such problems with it that they might have to abandon it entirely. Will the Minister say how well the system is working and whether there is any prospect of transferring the existing case load to the new computers? We need to know whether that it feasible, and whether the Government are still committed to doing so.

I also want to ask the Secretary of State about pensions and pensioners. We are proposing to increase the value of the basic state pension because we do not want to live in a country in which more than half of all pensioners are dependent on means-tested benefits. The evidence of the low take-up of means-tested benefits shows that most people remain uncomfortable about claiming such benefits, however much the Secretary of State's Department spends on advertising them. The take-up of means-tested benefits is still shockingly low. Indeed, the Secretary of State hat had the honesty to admit that council tax benefit take-up is too low, and that he wants to raise it. The take-up rate for the old minimum income guarantee was just over 70 per cent. This is not good enough. It is extremely risky for the Government to put increasing weight on means-tested benefits to try to help poor people, given that the evidence shows that it is very difficult to increase take-up, despite Ministers' best efforts.

We are proposing to help take pensioners off means-tested benefits by increasing the value of the basic state pension. That would tackle a widespread grievance among pensioners and provide a solid basis for the savings industry to sell its products to future generations of pensioners. The industry says that it cannot encourage people to save because many are worried about being caught out on means tested benefits when they retire. Our proposal would offer a better deal for pensioners, and it would provide a better way of encouraging people to save for the future.

Is the hon. Gentleman therefore telling the House that he would simply take money away from the poorest pensioners in order to redistribute it to the better-off ones?

I am happy to reassure the hon. Gentleman that I am not saying that at all. We have no wish to abolish the pension credit—I think that the Secretary of State used that expression, although he did not attribute that wish to a particular person—but we propose to replace it over time with the state pension as it increases in value. No pensioners will lose as a result of our policies, and the poorest pensioners, who are not claiming the means-tested benefits that they are entitled to, will manifestly gain from our policies. It is very important that they get the help that they are currently not receiving.

Is the hon. Gentleman therefore saying that under his proposal, the pension credit would be frozen, the poorest and middle-ranking pensioners would get no uprating, and that that money would be spread among those who are not getting pension credit?

We are not proposing to make any changes to the pension credit. We are simply proposing to increase the value of the basic state pension in line with earnings, which would gradually ensure that an increasing number of pensioners became free from means-tested benefits.

There is a crucial point on which I have previously asked the Secretary of State for clarification, and the intervention of the hon. Member for Waveney (Mr. Blizzard) gives me another opportunity to do so. It would be extremely helpful, particularly for pensioners and those who represent them, if we knew whether the Secretary of State-assuming that there is a third Labour term and he is re-elected to office-intends to increase the value of the pension credit by earnings or by prices. When we know the answer to that question, we can put further flesh on our proposals for pensioners. But the Secretary of State has never told this House that he is committed to increasing the pension credit by earnings in the next Parliament. Again, I invite him to the Dispatch Box, should he wish to give that assurance today. He seems unable to give it, and our assurance in respect of an earnings link for all pensioners and the basic state pension is a manifest improvement on anything that pensioners have received through the previous proposals of either of the two main parties.

The Secretary of State has again failed to take the opportunity to tell us that he is going to increase the pension credit by earnings in the next Parliament. If he will not do so, it is absolutely clear—[Interruption.] A Labour Member shouts "cop-out" from a sedentary position, but the cop-out is the Secretary of State's. The cop-out is that of a Government who still will not tell us what their intentions are for the pension credit in the next Parliament. However, we have set out our proposals for the basic state pension.

Does my hon. Friend agree that one of the problems—it is particularly apparent in my constituency—is that many of the people who are entitled to benefits do not claim them because they have no experience of doing so? Many of those who are in the most deprived state are widows who have no experience of claiming benefits. Not only are they intimidated by the paperwork that they must complete—it is very intimidating, as anyone who examines it will see—they are too proud to claim and feel that they should not do so. However, others who have claimed various benefits virtually throughout their lives find it much easier to do so. It is that first group who often constitute the very poorest in our society.

My hon. Friend is absolutely right. Although I do not have the figures to hand, this is an important aspect of the council tax problem with which the Government are wrestling. The evidence of the take-up of council tax benefit among owner-occupiers—they have probably not been on income support or the minimum income guarantee in the past—is, from memory, about 30 per cent. I would be happy if Ministers want to intervene to correct me, but the take-up is very low among people who have not previously claimed any means-tested benefits. That is why there is such a problem with council tax at the moment.

Do not the Government send out mixed messages when they say that they are trying to target help on the most vulnerable rather than give general increases, yet they have granted a general increase in heating allowances to every pensioner irrespective of income and a free TV licence to people over 75? They cannot argue both ways and claim that they are targeting help on the most vulnerable when they give out extra benefits across the board.

My hon. Friend makes a good point. As I hear the different arguments from Ministers about why the winter fuel allowance is right for everyone; why older pensioners who tended to be poorer should be helped by a free TV licence for over-75s; and why means-tested benefits are also important, I detect completely different arguments in different contexts for different benefits.

For the sake of clarity, is the hon. Gentleman seriously proposing that a Conservative Administration would have no means-tested benefits?

Conservatives are realists. I am a realist and I know that there will always be some means-testing. What we object to is the Chancellor of the Exchequer putting more and more people on means tests, when that should be a necessary but modest part of the benefits system. Means-testing should not be a central part of the Government's policy for tackling poverty and improving living standards. Under the present Government, what has happened—contrary to what the Chancellor said in opposition—is that we have become increasingly dependent on means-tested benefits as the Government's way of trying to help people, but they are simply not working. With more than half of all our pensioners on means-tested benefits, this is not the sort of country in which I wish to live.

rose—

rose—

I have already accepted two interventions from the hon. Member for Waveney, so I give way to the hon. Member for Cardiff, West (Kevin Brennan).

If I understand correctly, the Conservative party proposes to reduce the proportion of gross domestic product spent by central Government, and in doing so to ring-fence the amount spent on education and health. So how will the hon. Gentleman pay for his pension funds?

My right hon. Friend the shadow Chancellor made it clear in his authoritative statement the other day that his public expenditure proposals include our plan to increase the value of the basic state pension in line with earnings rather than prices. We have set out a very carefully costed programme to be financed by a combination of offsetting savings in means-tested benefits, which will gradually be displaced, and the abolition of the now deals, particularly for young people, which are not helping. What we are proposing is a much better system than the one it will replace.

In reminding the House: of what the shadow Chancellor said, will the hon. Gentleman also remind us that he said that in order to pay for the policy, a Conservative Government would have to take some "painful" decisions. Perhaps the hon. Gentleman could tell us precisely who would suffer that pain? On the new deal, can he explain the arithmetic whereby moneys are released to pay for the policy when the independent evidence shows that the new deal for young people alone saves the Exchequer s significant amount?

The research to which the Minister refers was an extremely sloppy piece of work. [HON. MEMBERS: "Why?"] It was sloppy because it took the receipts from the windfall tax, put them all into a bank account and counted the interest earned on the unspent windfall tax receipts as one of the ways by which the Exchequer benefited from the new deal. That was a ludicrous way of assessing whether the scheme would help young people into work. That is why it is a sloppy piece of research.

We know from the National Audit Office that about 8,000 young people have been helped into work by the new deal for young people—a tiny figure in comparison with the figures that Ministers use. The new deal for young people has not been a good use of public money because most of the young people who got into work would have got into work anyway and they were doing so before the new deal came along. The fallacy of the Labour party is the claim that everyone who got into work since the arrival of the new deal for young people did so because of it. As I said, young people were getting jobs before that:80 per cent. of young people were leaving benefits and getting into work before the arrival of the new deal for young people. That is why it is a bad deal.

rose—

I have given way several times to the hon. Gentleman and I want to move on to my final point, which is another question for the Minister for Work to deal with when he winds up the debate.

I have read the document before us, and I was rather surprised by what has happened to the administration costs of the national insurance fund. Will the Minister explain why the accounts before us—provided by the Government Actuary 's Department—reveal

"a large increase in the administration casts: the final costs for 2002–03 were almost 40 per cent. higher than the provisional estimate given to us by Inland Revenue al this time last year and the current 2003–04 provisional estimate is 40 per cent. higher than that."?

Given that we are all committed to reducing the overhead costs of Government, and that Conservative Members are serious about reducing them, can the Minister explain why the Government Actuary has been caught out by two successive 40 per cent. increases in administration costs? I greatly look forward to the Minister's response and I hope that he will tackle the points that I have made in my contribution to today's debate.

This is an annual ritual in which social security nerds get together and speak to each other in a language that no one else in the country understands. I feel that I have to contribute for the sake of tradition.

I have a few minor quibbles against Government policy, but I am certainly against the policy of Conservative Members, who constantly amaze us with their brass neck after years of ravaging the social security system, cutting the benefits of the poorest people and 17 continuous years of salami cuts to the basic pension. I believe that we can say to the country that the Labour Government have, provided the best period ever for social security benefits and imaginative changes, and that for pensioners this has been the best period in recent history, in which benefits have increased by substantial amounts.

One of my regrets about the basic state pension—I raise the old chestnut again—is the link to earnings. If the uprating had been linked to earnings, the basic state pension for a single person would be 40 per cent. higher and for a couple 65 per cent. higher than now. It is a shame that we did not do so over a period in which the Government have engineered low interest rates and a steady economy, because we could have taken on the role of linking the basic pension to earnings with very little effect on the finances.

The hon. Member for Havant (Mr. Willetts) outlined the Conservatives' policy, which seems to be to link the basic pension to earnings. I believe that that is an admirable aim, for which many hon. Members on both sides of the House have asked over many years, but the downside is that the increase in the means-tested minimum would be at the level of prices. That is an extraordinary position, and for us old lags in the business it is so reminiscent of what happened throughout the 1980s when the link was broken. It would be a return to the Thatcher Government policy of allowing pensioners on income support to fall further behind the income levels of working people each year.

Getting people off means-tested benefits is a fine aim. We all want that to happen, but the Opposition proposals would make recipients of means-tested benefits relatively poorer, year by year. That is entirely morally indefensible. The hon. Member for Havant (Mr. Willetts) has presented a programme that would be aimed at that group of poorest pensioners. It is a cynical move: the Opposition want to grab a headline by saying that they would restore the link, but they do not make it clear that the other side of the coin is that they would cut what means-tested pensioners receive. People must not be taken in by what the Opposition say on this issue.

Another old favourite topic is the state of the national insurance fund. Its administrative costs might have increased for many reasons, but the fund is one of the Government's most successful enterprises, despite this year's seemingly disastrous news. It continues to be very profitable, even though income from contributions in the current year is expected to be £31.4 billion less than the Government Actuary estimated a year ago. That may be a surprising figure, but even so the fund's income is expected to exceed expenditure by a healthy £35 million. The balance in hand at the end of the year will be nearly £27.3 billion—three times the minimum working balance recommended by the Government Actuary.

To put it another way, the fund is supposed to operate on a pay-as-you-go basis, but it has an unneeded balance of some £18 billion—money that contributors have paid to meet the current costs of benefits, but which has not been used for that purpose. A written answer from my right hon. Friend the Paymaster General on 6 February showed that the whole of that £18 billion unneeded surplus had built up since 1997.

What will happen in the coming year, 2004–05? The Government Actuary's estimates show an increase of 5.6 per cent. in the fund's income, but an increase of only 3 per cent. in its expenditure. That produces another massive surplus of £32.4 billion. By the end of the year, the accumulated balance will be £1 billion more than the Government Actuary recommends.

It is often suggested that that is not real money, and that the fund does not really exist. It certainly does exist, however: nothing could be further from the truth than to suggest that it exists in some sort of parallel financial universe. The fund does exist, and an account of its investments is presented annually to Parliament. Those investments could be realised at any time if the money were needed for the payment of pensions or other benefits.

Although the fund exists, the Treasury treats it as an undifferentiated source of Government revenue. It is obvious that, in fixing benefit rates for the coming year, no account has been taken of the almost £20 billion needlessly held in the fund, although those who contributed the money assumed that it would be used for that purpose. Neither has any account been taken of the annual loss of £2 billion suffered by the fund as a result of reductions in employers' contributions to compensate them for the climate change levy and other "green" taxes.

That sum of money is rapidly becoming forgotten. I raised the matter in the Select Committee with one of the Treasury Ministers. I said that the climate change levy and other environmental taxes are being paid by the national insurance fund, through the reduced contributions for employers. Although those taxes are necessary and beneficial, why on earth should pensioners—the major beneficiaries of the national insurance fund—be the main payers? The fact that they are doing so is extraordinary, and a distortion of the fund's proper use.

In another written answer on 6 February, my right hon. Friend the Paymaster General said:

"The UK national insurance scheme operates on the "pay-as-you-go" principle so that the contributions paid by people of working age fund the benefits of people who are currently claiming benefit."—[Official Report, 6 February 2004; Vol. 417, c. 1082W.]

That is true, as far as it goes, but it would have been more accurate to say that part of the contribution income is used to fund the benefit, and that the rest is used to help the Chancellor meet his fiscal targets. That is a long way from the original purpose of the national insurance fund, which was introduced by the last Liberal Government—some time ago.

Introducing his pre-Budget report on 10 December, my right hon. Friend the Chancellor of the Exchequer referred to the cost of restoring the earnings link. He said that

"to revert to the pre-1980 position—an earnings link with pensions—would, by the end of the period"—

that is, by 2050—

"raise deficits by 3 per cent a year just to cover this one item, with the long-term sustainability of the public finances undermined."— [Official Report, 10 December 2003; Vol. 415,c. 1063.]

Few people will be neurotic about the possibility of our finances being undermined by 2050. There was no mention of the fact that the basic pension is an insurance benefit, financed by contributions to the national insurance fund. If contributors are prepared to meet the cost from year to year, the sustainability of the public finances will be entirely unaffected.

What we really need is a radical review of the financing and control of the whole national insurance system, so that contributions can be seen to be used for the traditional purposes stated throughout the fund's history. In that way, account could be taken of all the principles on which the fund was based.

A paper entitled "Better Pensions" from the think-tank, Catalyst, proposed the establishment of a national insurance commission consisting largely of representatives of contributors and pensioners. Such a commission would provide a very good starting point for reform of the system.

The question of means testing has been raised already, and will probably run throughout the debate. We are told that it is no longer the means testing of old, and that we now have a new and cuddly version. That is fine, and there is some truth in that statement. People no longer have to supply details of their income on a week-to-week basis, which is a welcome change. We should also pay tribute to the unprecedentedly energetic and resourceful work of the pension services in tracing all those people who are entitled to means-tested benefits. However, the great condemnation of such benefits is that a huge number of people do not claim them.

My right hon. Friend the Secretary of State rightly referred to the poorest pensioners, but the poorest of all are those who are entitled to means-tested benefits but do not claim them. The problem has persisted under all Governments. The Government's target is to get at least 3 million households on pension credit by 2006. That will be an enormous undertaking, given that the number of pension credit households was little more than two thirds of the target figure. Ambitious as the target is, it would still leave 1.4 million pensioners not receiving the credit to which they are entitled.

It is not true that we have solved the take-up problem. We must do a great deal better in that respect, and I look forward to what my hon. Friend the Minister for Work has to say when he responds to the debate.

I turn now to the savings disincentive. The prospect of more than half the pensioner population being entitled to pension credit, not just in the short term but for the foreseeable future, poses a more fundamental problem. Those in receipt of the credit will find that its value is reduced by 40p for every £1 of income that they receive from an occupational or stakeholder pension. What sort of message will that convey to people of working age who are wondering about saving more for their retirement?

The problem is a growing one. I wonder whether those who push pension policies acknowledge that and make it clear that that is what will happen. As long as means-tested benefits exist, it will be hard to avoid the twin problems presented by low take-up and the incentive to spend rather than to save. However, we can stop the problem from spiralling out of control by keeping the gap between universal and means-tested benefits as narrow as possible, or at least by preventing it from widening. The simplest way to achieve that is to restore the earnings link, so that the basic pension rises in line with the means-tested minimum. That is a familiar plea in the House, but it is always valid.

I invite the hon. Gentleman, who might have more success than I did, to ask the Secretary of State whether the value of means-tested benefits for pensioners will rise in line with earnings in the next Parliament, if the Government are re-elected.

I am touched by the hon. Gentleman's faith in my ability to persuade the Government. For about five years, I got up at an ungodly hour to table early-day motion I, urging that the link between the basic pension and earnings should be restored. Despite all my endeavours and those of the 100 or so fellow Members who signed those early-day motions, I failed so to persuade the Government. It is dishonest of the Conservatives to propose a programme that clearly would relatively reduce the income of the poorest pensioners. They suggest that the basic pension should be increased by earnings, which is fine, but increasing the means-tested pension only by prices would guarantee an increase in the disparity of incomes between better-off pensioners and the poorest pensioners.

If the Government cannot state their policy today, we must not gaze into a crystal ball but study their record, which is one of fairness, generosity and innovative policies that, as a pensioner of some four years' standing, I know people of my age greatly appreciate.

This annual debate affords the House the opportunity, which the Secretary of State and the spokesperson for the Conservative party took, to examine in detail benefit rates throughout the social security system and to reflect on Government strategy. I propose to follow them in doing so, but first I want to don my anorak—having been goaded by the hon. Member for Havant (Mr. Willetts)—and refer to article 20(3) of the regulations, which is obviously a contentious subsection:

"In regulation 16(3)(a)(k) (applicable amounts) '20 per cent.' remains unchanged."

The explanatory notes state, in the context of housing benefits for pensioners:

"Article 30(3) sets the percentage by which benefit is reduced after a period in hospital".

There is a corresponding section about council tax benefit.

Will the Minister explain the Government's thinking? Following pressure from others and us, there have been some welcome concessions on benefits for people in hospital, but are such people able to pay council tax any more than those living at home? Why should anything in the regulations cut council tax support for pensioners just because they are ill? Their other bills will continue. When will that provision cut in, and what effect will it have? Do the Government have any plans to review that arrangement? I cannot see any justification for reducing that support. I give the Minister notice of that detailed point, so that he will have a chance to respond.

The Secretary of State referred to the proposal to defer a lump sum for five years, which is an interesting notion. I have no problem with the idea of new options, but I must admit to some concerns. The hon. Member for Havant queried whether that money will be disregarded for the purposes of pension credit—one of two key questions. I was dismayed that the Secretary of State was unclear, saying that the principle is that the recipient will be no better but no worse off. What will that mean in practice? A man of 65 needs to know unambiguously whether the lump sum will count towards pension credit. If it does, that will change the entire calculation and it will become excruciatingly difficult. Although a 6 per cent. gross allowance might be achieved by deferring, which would probably be subject to tax, would the individual lose all future entitlement to pension credit, or lose it only until they had run down some of their capital stock? Some existing capital stock from another source might count, whereas new capital would not. Unless that scheme is implemented simply, pensioners might be asked to make complicated calculations. The Government's record on simple implementation is not particularly strong.

I understand that that proposal has been associated with the Pensions Bill, but I am not sure whether it requires legislation. I hope that the Government will soon be a good deal clearer on how that provision will work. Presumably the typical £100 that rolls up would be taxable, so one supposes that the lump sum also would be taxable. Would it be taxable only at the basic rate—the rate at which it would probably have been taxed when it accrued—or, because the £100 would grow into a socking great sum that would take someone way into the higher rate band, would there be some special tax rate? Would a person at the age of 65 be offered £26,000, or whatever the sum is at age 70, or £26,000 gross, which turns out to be £20,000 net? If so, the individual might have achieved the same return by putting their pension into an ISA. The Government talk about simplicity in pensions but are creating something that is not nearly as simple as has been suggested.

Although some of the Government's ideas are not bad, they have been grossly overspun. The option of going without a pension for five years is not one that the masses will go for. The people to whom the Government want the scheme to appeal will predominantly be part-time workers. I do not believe that the Government have in mind people who work full time until age 70. People in good full-time jobs and on high incomes are probably well placed to sort themselves out anyway.

The Secretary of State mentioned women. The suggestion that women on modest part-time earnings would defer their pension for two or five years is farfetched and fanciful. I hope that the Secretary of State will not oversell the proposal. We do not have a problem with people being offered new choices, provided that they are simple and will not place them at risk of making the wrong decision. I hope that the Minister will not pretend that the proposal is some sort of revolution, because most people cannot afford to do other than take their pension as soon as it becomes available.

The main national insurance benefits for non-pensioners are linked to the retail prices index, excluding housing costs—and because of real increases in rents and housing costs, the rate is lower than inflation. The money spent on schemes such as the contributory jobseeker's allowance is now pathetically small—60p per week for under-25s and 80p per week for over-25s. An unemployed 25-year-old with a good contributions record receives £55.65 a week, whereas average earnings must be approaching £400 or £500 a week. When such allowances were created, they were meant to serve as earnings-replacement benefits. If they continue to be linked to a low measure of inflation year after year, their potential for serving as earnings-replacement benefits must have disappeared long ago. Do the Government plan to permit such allowances to wither, dwindle and become an anachronism, because they cost a lot to administer—money that could be spent helping unemployed people who need support. The Government have an interest in permitting such benefits to wither, but is any systematic policy in place to re-examine the role of benefits, rather than let them die from natural causes?

The age addition for the over-80s remains at 25p. It has stayed at that level for nearly a quarter of a century. Five shillings was once a lot of money, but it is not today. There is a fundamental difference between the Government and us over the potential for using that money to reach the most needy pensioners. There is some common ground between the official Opposition and us in respect of persons who do not receive pension credit, the majority of whom are elderly pensioners. The Government have missed the opportunity to do something with the age addition, rather than let it wither. The length of the regulations is testimony to the complexity of the entire system, which contains all sorts of bits and pieces that do not do what they were originally designed to do but that nobody will sort out. One occasionally wishes that, instead of producing the same document setting the figure at 1.8 per cent. practically every year, someone would take a strategic look at the system rather than let it drift on with bits falling into disrepair. The social security system is like a house that nobody has lived in for many years—things are gathering dust because they have always been there.

I want briefly to raise three strategic issues. First, we have not touched on the transfer responsibility for poor families with children from the social security system to the tax credits system. When I first saw the regulation, I rang the Library and asked whether there had been a typing mistake because the rate for children is £42.27, which is a strange number that looks a bit odd. It became apparent that the figure is not actually a social security rate; it is a tax credit rate per year converted into a weekly amount.

Whereas last year's transition from supporting families through the social security system to supporting them with tax credits was a mess, at least the people covered by that system were generally workers who had some other source of income. This April, people who are wholly dependent on the social security system will transfer to the Inland Revenue's clutches. Most of their money will come from tax credits rather than from social security, and it is vital that the process is right. When the Department for Work and Pensions says on day one, "You are not our responsibility any more. We will give the amount for the adult, but it is over to the Revenue", the Revenue must not say, "We will get it right in July." Such families cannot be put in that position.

I asked the Paymaster General for information on the transition, and she promised the House a statement, which we have not yet heard. It is nearly March and the transition occurs in April. What is going on? Why have we heard nothing from the Government about how the transition will happen? Are low-paid families on income support confident that support for their children will seamlessly—that adverb is not often used in the context of the tax credit system—continue the day after the DWP pulls out? I hope that the Minister for Work can reassure us that he is actively ensuring that such people, for whom his Department is currently responsible, will have their welfare protected and that the transition is already being properly planned. The people involved with the dreaded computer systems that lie behind the transition say that they are behind schedule on the testing, and one's heart sinks at the prospect of the mayhem that might arise.

I entirely agree with the hon. Gentleman's concerns. Does he agree that although we have been told that the new system is seamless, unemployed families will find themselves dealing with two different agencies and trying to receive money from two completely different sources? It is absurd to regard the transition as simplifying the system for adults who will continue to receive benefits or for children who will need help from the Inland Revenue or tax credits.

I sympathise with that point, because I have tried to help constituents to sort out their child tax credits. The system has been running for nine or 10 months only, and my constituents raise concerns such as "My partner changed hours in July" and "I did some overtime in October". Such reporting and record keeping will be part of daily life for families across the land. Again, I am worried that the Inland Revenue is not geared up to act quickly. For all the failings of the benefit system. it was pretty good at responding quickly to emergencies. The Revenue must adopt that culture, and it must adopt it quickly. I am seriously concerned about the matter. Although it will by and large be the Treasury's problem after April, 1 hope that the DWP is throwing its weight 'around behind the scenes because I fear the worst. I am not scaremongering because last year we saw what can happen when the system goes wrong. The people affected last year had some income, but the folk whom we are discussing are wholly dependent on this money, so I hope that lessons have been learned.

Secondly, the hon. Members for Havant and for Newport, West (Paul Flynn) touched on the national insurance fund, and I want to pursue the issue of the report on the regulations. Appendix 7 compares the out-turn for 2003–04 with the estimate made one year ago. The hon. Member for Havant raised the issue of administration costs, which I want to pursue. One year ago, it was forecast that it would cost about £1 billion to administer the national insurance system, but the out-turn is £1.75 billion. In one year, the estimated cost of administration has gone up by £750 million, and a footnote lists two sources for that increase.

There has been a to-ing and fro-ing of funds between the national insurance system and the rest of the DWP. How can one work out how much it costs the DWP to administer its bit of the national insurance system? One must stick one's finger in the air and pick a figure, so the grey area surrounding that figure and the possible end of year adjustments is understandable.

The second reason is interesting:

"a one-off payment was made to the Welfare Modernisation Fund."

That sounds suspicious, so I tabled a written question to find out the size of the payment. The explanatory note does not state the size of the payments, which seems odd given that we are discussing £750 million. It would be reasonable to break that figure down, but that has not happened. The written answer was not helpful, apart from giving me a slight sense that the Department sees the national insurance fund as a cash cow, which is the point made by the hon. Member for Newport, West.

The DWP cannot get rid of the blessed money because it does not want to put it into national insurance benefits, but it can have £750 million for departmental running costs, which is a clever trick if one can pull it off. Once again, the House's scrutiny of the expenditure of such vast sums of money is pathetic, and I take as much responsibility for that as anyone else. I hope that the Minister will tell us more about the £750,000 in his winding-up speech because it is not small change—one could build the dome for such a sum. What is the scrutiny process? I hesitate to say that £750 million has been pilfered from the national insurance fund, but there has been sleight of hand at the very least.

Thirdly, I shall discuss take-up. The benefits are great for people who get them, but they are less great for those who do not. We have heard that council tax benefit is the least well taken-up means-tested benefit—I used to make that kind of comment at dinner parties just to keep the conversation going, but now it is received wisdom. More than 1 million pensioners are not claiming their council tax benefit.

The hon. Member for Bournemouth, West (Sir John Butterfill), who chairs the all-party group on occupational pensions, is no longer in his place, but he pointed out a particular issue for owner-occupiers in an earlier intervention. Three quarters of the pensioners who do not take up their council tax benefit are owner-occupiers. Because they have reached the age to draw their pensions—perhaps they draw a bit of company pension as well-they are not used to claiming benefits and do not think that it has anything to do with them.

We are now seeing the political consequences of people not claiming the council tax benefit to which they are entitled. More than 1 million pensioners find it so hard to pay their council tax that the system puts something in place to support them, but they do not receive the help. The political point is that pensioners who claim their council tax benefit once are insulated from any future increase in council tax, which is slightly odd. In other words, the system works out what people can afford to chip in regardless of actual council tax— for example, the system might say that someone can contribute £5 a week regardless of increases in council tax. If council tax goes on rising at a far greater rate than inflation, all those people will be insulated. There is a huge political reward for the Government if they can get such people on council tax benefit.

Every year I ask the Government why they do not use the income information that they already collect? Hundreds of thousands of pensioners supply the Government with every single bit of information that the Government need to work out council tax benefit because they are claiming pension credit or housing benefit. That does not apply to owner-occupiers, but it still includes more than 333,000 people. Every year, I am told that there is a pilot, scheme or advertising campaign. We heard about another advertising campaign this afternoon—whoopee! The Government have not addressed the structural problem for seven years. I know that there have beets pilots, but I simply cannot understand why the Government are not just doing it. What is the problem? Will the Minister tell us why the Government do not regard a claim for pension credit as a claim for council tax benefit? Why do they not regard a claim for housing benefit as a claim for council tax benefit? If they did so, at least 333,000 pensioners would get the money to which they are entitled. The matter is not difficult and I do not understand the problem.

The system is fiendishly complicated and is becoming more so with every passing year. Any hon. Member who understands the child tax credit and working tax credit systems deserves enormous credit. The people who need the system most are not being helped because it is so complicated and they do not make claims. The transition from one scheme to another could leave far too many people in the lurch. The benefits may be all very well for those who receive them, but far too many people fail to receive them.

I wish to make two brief points and one slightly longer one. First, I agree with my hon. Friend the Member for Newport, West (Paul Flynn), who made the point in an intervention that the definition of poverty needs to be refined. It is absurd that an increase in the number of millionaires leads to an increase in the percentage of people in poverty without anybody getting any worse off. That is a statistical problem that needs to be addressed.

My second point is addressed to the hon. Member for Havant (Mr. Willetts). The sentiment was expressed more eloquently in this House many years ago, but we do not need to look in a crystal ball to see what the Tory party would do: we need only look in the history books. Of course, the Tories cut the link with earnings for pensioners, and thus did more to keep pensioners in poverty than any other party in the 20th century. That is not anything to be proud of.

My third point concerns the fear of poverty and the presentation of it in the press, and it is related to the intervention I made earlier about the lady who was allegedly about to go to prison because she could not afford to pay the council tax. I thought that that story was wrong as soon as I saw it, because the press claimed that she received only £312 a month in pension. I do not know who her MP is and I make no criticism, because we can all let things slip by, but my immediate reaction was that if she had been my constituent I would have tried to find out why she was receiving so little when she would be entitled to at least £400 a month, if not more. In any event, she should probably not pay the council tax or should receive a significant rebate, unless she had substantial savings.

Editors and sub-editors should know, given that many junior reporters will know, that someone on such a low income would normally get benefits. In other words, someone should have recognised that the story was seriously wrong. The hon. Member for Havant appeared to misunderstand me—and if he consults Hansard, he will see why—when he suggested that I was criticising the lady involved. In fact, in some ways, I made her point for her. She objected to the use of her council tax to fund a part of the European Union regional government structure. I make no criticism either of the United Kingdom Independence party or of Max Clifford. All three co-operated on a legitimate campaigning point, although the lady was unwise to say that she would go to prison for the cause.

I do, however, strongly object to the press using the story to present the lady as being in poverty, and that is related to my wider point about the fear of poverty among pensioners. One result of the story was that people sent cheques to the local authority to pay the lady's council tax bill—I do not know what the local authority will do with the cheques that were paid anonymously—but she was trying to make a political point. She said that she was prepared to go to jail because she objected to one aspect—or perhaps the whole—of the European Union, but she was not making a point about poverty

I remember that in 1997, when this Government were elected, some0 pensioners—especially women who had not paid any contributions during their working life —received only some £60 a week. That quickly went up to more than £90 a week and then to more than £100 a week, but—as ever with means-tested benefits—the problem was getting the message over. Some people did not receive the full amount and it was necessary to draw their entitlement to their attention. That is why I think the newspapers could have made a good story out of the lady's example. They could have said, "Look: pensioners who are getting only this amount need to put in a claim, either for council tax rebate or exemption, or for the increased pension that they are owed." The newspapers did not do that, and that was unfair of them.

Paul Dacre, the editor of the Daily Mail, who was very keen on the story, awarded himself £80 million a couple of years ago and presumably does not have to worry too much about paying the council tax. He will probably also accept his state pension in the normal way. I would have been more impressed if he had used his power, knowledge, position and influence to draw to the attention of pensioners their entitlement to those allowances. That would have been a good story and one that the papers could have been proud of.

Pensioners are not a timid group as a whole, but there are some timid people among them. However, the fear of the means test is no longer the main issue. It has a terrible reputation from the period of mass unemployment in the 1930s, but it no longer holds the same terrors. I do not claim that it is easy or has no problems associated with it, because it has, but I have noticed that pensioners who are entitled to council tax rebates or exemptions do not claim them. They assume that they have to pay the council tax whatever their income. The headlines in the press said that the lady in question had to pay or go to jail, so it is not surprising that some pensioners are fooled into believing that if they do not pay they will go to jail. It is irresponsible of the press to use such stories to scare people. We should have no illusions about it: that is what they are trying to do. I do not mind the press making political points, but they should not use vulnerable people to do so.

My ministerial colleagues are doing a good job on pension and benefit issues, but we must get over to people—the hon. Member for Northavon (Mr. Webb) also made this point—the fact that council tax exemptions and benefits are available. It is important to get that across to pensioners, because they are most affected by it. The newspapers could help in doing that. If they had used the story last week to get the message over, there would be many people feeling more comfortable and being slightly better off as a result. Instead, a person who set out on a road out of principle has had it turned into something else and, at the same time, others will have been made fearful about the dangers of going to prison if they do not pay their council tax.

It is a pleasure to be able to take part in this short but high-quality debate on the uprating orders. We have heard some interesting contributions—not least, the one from the hon. Member for Ealing, Acton and Shepherd's Bush (Mr. Soley). I always think of his constituency as including part of Hammersmith, having been chairman of the Hammersmith Conservatives many years ago and failing miserably to unseat him, to his no doubt considerable relief.

We started the debate with an orgy of self-congratulation from the Secretary of State about the benefits situation. As the debate has worn on, however, some of the gilt has come off the gingerbread. The Government now spend £125 billion a year on benefits and tax credits. Are they spending all that wisely, sensibly and effectively? Certainly not.

I turn first to the issue of means-tested benefits, especially council tax benefits, as that subject arises naturally from the previous speech. We know that council tax benefits have the lowest take-up rate and we know the reasons. I shall not repeat the good points that have already been made about that aspect of the debate. We also know the problems that have been caused by the recent shift in grant allocation from the south of the country to the north and midlands. We have also had endless debate about the case of the elderly lady, and I shall not dwell on it at any greater length. The hon. Member for Ealing, Acton and Shepherd's Bush has made his points.

As the Secretary of State recognised, however, there is a major problem in getting to claim that particular means-tested benefit. Within that problem is the even bigger problem of owner-occupiers; the hon. Member for Northavon (Mr Webb) touched on that important point. All too often in recent times, retired owner-occupiers, with major difficulties in making ends meet, have been faced with gigantic increases in their council tax and are either unable or unwilling to claim council tax benefit—in many cases, simply from ignorance that it even exists or that it would apply to them if they asked for it. I welcome the Government's publicity campaign, but that very campaign underlines the immutable problem with all means-tested benefits: there will always be a lack of take-up of those benefits, no matter how much any Government spend on advertising, television or writing to people

In my constituency last year, there was a 38 per cent. increase in the council tax element generated by Eastbourne borough council—the fourth highest in the country. The hon. Member for Northavon would be disappointed if I did not remind the House that Eastbourne is a Liberal Democrat-controlled authority. Locally, the Liberal Democrats are running their "Ax the tax" campaign, which is rather like a serial killer pleading, "Please stop me before I do it again". However, in reality the fact remains that many vulnerable elderly people, who have limited resources and have great problems in making ends meet, do not claim their full entitlement.

I shall return to means-tested benefits in a moment, but first I want to touch on the issue of economic inactivity on which there was some dispute between the Secretary of State and my hon. Friend the Member for Havant (Mr. Willetts). There is a growing and worrying problem, which David Smith set out well in an article in The Sunday Times only a couple of days ago. He said that, yes, the headline figures for employment look pretty good, on the face of it. Indeed, only the other day, the Minister for Work, who will be winding up the debate, was quick to issue a press release taking credit for what seemed to be relatively rosy figures, but as the article in The Sunday Times says—

Will the hon. Gentleman give way?

Yes, although I should have liked to finish my point.

I am grateful to the hon. Gentleman for giving way in mid sentence, but it is important that he inform the House of two things. First, the press release was issued in response to the monthly labour market figures published not by my Department but by the Office for National Statistics. Every month from time immemorial, every Minister who has had my responsibilities has issued a press release on those figures, although they have not always been able to welcome the good news that I have been able to welcome so consistently. Secondly, the hon Gentleman should have informed the House of the fact that I drew attention in that very press release to inactivity. Indeed, I have done so in almost every public statement that I have made as Minister for Work.

That is a helpful intervention. I was certainly not criticising the Minister for putting out a press release; that is one of the things that Ministers do. On the Minister's second point, I am delighted that the penny has begun to drop for Ministers and the Department and that they realise that there is a massive hidden problem—

rose—

May I get to the end of this sentence? [Interruption.] Very well, I give way.

I do not know where the hon. Gentleman has been over the life of the Labour Government, but, if he does not already have them, I shall send him the documents we have published on the development of our policies to tackle inactivity. He must surely know about the "Pathways to Work" Green Paper, published about two year, ago, and about the pilots which have already taken place, and which will be taking place shortly across 10 per cent. of the country.

In a sense, this argument is the wrong way round. The Minister was obviously so incensed by some of the comments made by my hon. Friend the Member for Havant and endorsed by The Sunday Times that he took the trouble of writing to my hon. Friend on 9 February to complain about the figures on which my hon. Friend has been relying, which I shall cite in a moment. The Minister cannot have it both ways. He cannot agree with what I have yet to say on the subject on the one hand while on the other violently disagreeing—albeit with his usual courtesy—with my hon. Friend in writing earlier this; month. Or are there two Ministers of the same name prowling the corridors of the Department for Work and Pensions? [Interruption.] The Minister says that he can have it both ways. Perhaps he can—at least for the next 15 months.

May I now make the point with which the Minister so violently disagreed before I could make it? The Sunday Times article states:

"A record 7.85m people of working age are economically inactive, 2.lm of whom say they want a job."

David Smith draws particular attention to men aged between 25 and 35—a point that my hon. Friend the Member for Havant has made more than once. One would expect that in any given scenario that would be the age group of young men who were most likely to reach full employment, yet the article notes:

"employment in this age group has dropped by nearly a quarter of a million to 3.4m over the past two years."

There are various possible explanations for that. My hon. Friend has talked about the "lost generation" of more than 1 million young people without jobs or proper education and training. That throws into stark contrast the headline figures comparing our rates of youth unemployment with those in countries such as Germany—[Interruption.] I can see that the Minister is gearing himself up for another intervention.

The youth unemployment rate in Britain is actually 12.3 per cent. compared with 10 per cent. in Germany. Is this a convenient moment for me to give way to the Minister?

No, carry on.