John Robertson (Glasgow, Anniesland): Thank you, Mr. Amess. I am delighted to have secured a debate on an issue that does not just affect my constituents but those of every hon. Member.

People of pensionable age make up 18 per cent. of the UK’s population. My constituency of Glasgow Anniesland has one of the highest concentrations in Europe- 31.5 per cent. of the electorate are in that bracket. It is very important for me to ensure that an issue that affects such a large number of my constituents is recognised and addressed by the Government. There is no doubt that the policy initiatives introduced by the Government have made a huge impact on improving the lives of our pensioners. We have spent a great deal of money on pensioners-an extra £6 billion a year in real terms-as a result of the policies that we have introduced since 1997. In fact, we are now spending three times more than an earnings link since 1998 would have given pensioners.

Between 1979 and 1997 the gap between the richest and the poorest pensioners widened beyond belief. The top fifth saw their incomes rise by 80 per cent. above inflation, but the incomes of the poorest fifth rose by only 34 per cent.-less than half as much. I am very pleased that the Government have focused on pensioner poverty as an immediate priority. Indeed, measures such as free eye tests, the winter fuel allowance and free television licences for the over 75s have applied to all pensioners regardless of income. However, measures such as the increases in the basic pension and the introduction of the minimum income guarantee have ensured that it is the poorest pensioners who have benefited most.

This year’s Budget pledged that whatever the rate of inflation, the basic state pension will increase by at least £100 a year every year, and this year it is rising by even more than that: £156 a year for single pensioners and nearly £250 for couples. In fact, the average pensioner will be £7.75 a week better off as a direct result of the tax and benefit changes announced in this year’s Budget. All in all, with the minimum income guarantee, the new pension credit and the new pensioner tax allowances, the average pensioner household is now £1,150 better off even after inflation than in 1997.

From next year, 5 million pensioners will gain from the new pension credit-on average by £8 a week or £400 a year more per household. For the poorest single pensioner, extra help will guarantee a minimum income of £98.15 this year and at least £100 next year. By absorbing the minimum income guarantee, it will underpin the incomes of people aged 60 and over so that they need not live on less than £100 a week, or £154 a week for pensioner couples.

There will also be a higher guaranteed income for those who are severely disabled, and for carers. I take a big interest in that subject, and I more than welcome that move. The pension credit will also reward pensioners for saving. We no longer want a security system that penalises pensioners with modest occupational pensions or savings. We no longer want millions of pensioners living on low or moderate incomes, who struggled to put money aside for their retirement, only to find they were little or no better off than people who had saved nothing. The credit will benefit half of all pensioner households, topping up the state pension with a cash reward, and ensure that pensioners with small occupational pensions or modest savings will no longer face losing a pound in their benefit for every pound of pension or other savings they have built up. Crucially, it will abolish the intrusive weekly means test. From age 65 most awards will instead be set for five years, and pensioners will have to report only significant changes in their circumstances.

The pension credit will be delivered through the new Pension Service as part of our plans to make it far easier for pensioners to claim all their entitlements. At the point of retirement, we will be able to work out how much pension credit pensioners are entitled to, at the same time as working out their basic state pension. We will then normally need to reassess their award only every five years, unless they tell us that their income has fallen.

Since April, the Benefits Agency ceased to exist and all work relating to pensions-for pensioners today and in future-became the responsibility of the Pension Service. There will be one point of contact for pensioners where pension entitlement and arranging payment can be worked out. Pensioners will need to give information only once and will not be left to find their way through the system. I welcome the measures, but I think that we could do more.

Life expectancy at birth has increased dramatically during the past hundred years. In 1910, for example, a man could expect to live until the age of 48, which means I would now have been dead for two years. Born today, he could expect to live until at least 75. Likewise, a woman born in 1910 had a life expectancy of 52 years, whereas today she can expect to live until at least 80. By 2020, there will be 50 per cent. more pensioners than there were in 1990 and a smaller workforce to support them.

As the population ages, we find it more difficult to support and protect our elderly. Recent figures show that fewer pensioners were in poverty last year than for the previous decade. Some 21 per cent. of pensioner couples now have incomes after housing costs of less than 60 per cent. of the median income, which is down from 27 per cent. 10 years ago and equates to well over 1 million fewer pensioners than in 1997. Those are encouraging signs that we are reversing the trend in the number of pensioners on relatively low incomes, and clearly show that we are moving in the right direction. Although I take heart from those figures, I do not believe that it is acceptable for anyone who has contributed all their working life to find themselves in poverty in retirement.

I congratulate the Government on the work that has been done so far, but I should like to make one or two suggestions about what we need to do now. I mentioned earlier that I welcomed the introduction of free television licences for those over 75, but I should like us to go a step further by lowering the qualifying age to 65. The most recent estimates put the cost of doing that at £714 million. It is a lot of money, but when one considers that annual spending on education and skills increased by £12.8 billion in the comprehensive spending review, it is not much. It is absolutely right that we invest in our children, but we must also look after our pensioners. When a person reaches 65, television is no longer a mere luxury, but a necessity.

I wholeheartedly supported the introduction of the winter fuel allowance, and the increases since then have been welcome. However, it is time to go further. Although there has been a drop in excess winter deaths, more people die in the UK than in any other European countries as a direct result of the cold. Winter is often a precarious time for older people. Research shows that the poorest pensioners tend to live in housing with the most inefficient heating and insulation: those who can least afford a high heating bill must pay most to keep their homes really warm. When a household needs to spend more than 10 per cent. of its income on energy, it is considered to be fuel poor.

The energy efficiency of the home is another key indicator. The energy efficiency rating of a home is measured by the standard assessment procedure or SAP, which has a scale from 1 for highly inefficient to 100 for highly efficient. The most recent figures showed that lone pensioners living in the private sector had an average SAP rating of 11, which compares with the national average of 35. New buildings are required to have an SAP of 70. We can see why those pensioners have to pay most for their heating.

Some 77 per cent. of single pensioners and 43 per cent. of couples are still fuel poor. It is estimated that fuel poor households still spend between £700 and £800 a year less than they should to achieve adequate warmth. I would suggest that, as a further step to eradicating fuel poverty, we look at increasing the winter fuel allowance to £250. I completely accept that the existing £200 payment was not even an option under the Tories, but we need to find ways of further eradicating fuel poverty. The cost to the Exchequer could perhaps be offset by the £1 billion that fuel poverty costs the NHS every year.

I welcome the home energy efficiency scheme, HEES-plus, which is aimed at people over 60 who receive an income-related benefit-the minimum income guarantee, council tax benefit or housing benefit. Government figures show that from 1990 to 2000, between 39,000 and 77,000 people did not claim the income support to which they were entitled. That does not entirely convince me that those who should claim HEES-plus will do so. If it is not claimed, it will not go far enough toward combating fuel poverty.

That brings me to my next point. One third of all benefits are now means-tested, but for pensioners the figure is almost 60 per cent. There is some evidence to show that the take-up of means-tested benefits by pensioners is low and, furthermore, that it is lower than when money was given directly to them through the higher basic state pension, which is targeted according to age. The key question, one that I hope the Minister will address, is how we continue to target our poorest pensioners. That requires a degree of means-tested benefits while ensuring that take-up is at a desirable level.

I wish that we could do away with means-testing, but unless someone can come up with a better way of assessing those who have least, I fear that it will be around for as long as we have poverty.

Annabelle Ewing (Perth): Will the hon. Gentleman give way?

John Robertson : Can the hon. Lady please wait? We must give the Minister time to answer, and I still have a little of my speech to go.

According to the Government’s figures, between 300,000 and 750,000 pensioners who are entitled to MIG have not taken it up. Take-up is low because many elderly pensioners are baffled by the forms and the complexity involved in trying to claim. I appreciate that we have shortened the MIG claim form from 40 to 10 pages, but at that age, even 10 pages is too long. I hope that the aims to do even better under the pension credit scheme will come to fruition.

Means-testing presents pensioners with particular difficulties. The complexity of the forms is not the only problem. Research shows that 3 million pensioners throughout the UK are not claiming the full range of benefits to which they are entitled. According to research carried out by Prudential, 43 per cent. of pensioners surveyed said that they did not realise that they were eligible for certain benefits, 23 per cent. did not even know that a benefit to which they were entitled existed and 18 per cent. were put off by red tape.

The research showed that 18 per cent. of Scottish pensioners were likely to reject means-tested benefits, compared with a UK average of 10 per cent. Increased means-testing, therefore, is disproportionate in its effect on Scottish pensioners. A factor that I have not yet mentioned is that pensioners are often put off means-tested benefits because they are proud never to have claimed any form of income support during their working lives and do not want to start in their retirement. We need something better.

We could look at the language used in naming additional benefits. Words such as “benefit”, “support” and “allowance” all conjure up an image of some form of income support or charity, as elderly people sometimes think of it. We must look at more positive words such as “entitlement”. The name “pension credit” is a step in the right direction, but even that could be improved. We should examine how we can promote the range of benefits and advice available to pensioners, to maximise take-up. I certainly hope that the new Pension Service will be more effective in that way.

I shall consider the new proposals that deal with the ways in which pensions will be paid from now on. There are plans to scrap the traditional pension book and replace it with a bank card, and to pay pensions into bank accounts. Although I understand the reasoning behind those proposals, I have concerns. Many elderly people do not have bank accounts, for various reasons. They may not understand them or they may be uncertain about new technology. Above all, there is no substitute at that age for meeting and dealing with a real person. Pensioners like to have cash to hand, but I fear that having to withdraw it from a hole in the wall will not reassure them that their money is safe.

I again congratulate the Government on all the work that they have done to help pensioners. They have introduced policies that would never have been introduced under previous Governments. Above all, we are on the right track to eradicating pensioner poverty and improving pensioners’ lives. However, I reiterate that I would like further steps to be taken. I am talking about free television licences for the over-65s, an increase in the winter fuel allowance, less means testing, more assistance for pensioners in finding their way around the system, and real people to deal with pensioners face to face, rather than new technology.

I have raised a number of issues and made suggestions about the way forward. I look forward to my hon. Friend the Minister’s reply.

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