Oral Answers to Questions

John Robertson Excerpts

Monday 19th July 2010 Commons Chamber

[Chris Grayling]

My hon. Friend is right, and it is clearly an absurd situation when work does not pay. We have to make changes, and my right hon. Friend the Secretary of State is leading an effort to address that problem. In this country we have to ensure that work pays, and that we do everything possible to help people off benefit dependency and back into the workplace.

[John Robertson (Glasgow North West) (Lab)]

3. What assessment he has made of the likely effect on pensioners of his proposed changes to the welfare system.

[The Minister of State, Department for Work and Pensions (Steve Webb)]

Since the general election a number of changes have been announced to benefits and pensions. The most significant for pensioners was our decision, after 30 years of decline in the pension’s real value, to restore the earnings link with the basic state pension.

[John Robertson]

I thank the Minister for his answer, but he is well aware that the earnings link will not help pensioners as of January, when they start to pay their increased VAT. That increase amounts to almost £8 billion over the life of a Parliament, so when will the hon. Gentleman stick by his party’s promise during the general election campaign to fight any VAT rise? What will he do to protect those elderly people who, through no fault of their own, will be left with enormous debts, thanks to this Government?

[Steve Webb]

I am not sure whether the hon. Gentleman is aware that the Office for Budget Responsibility estimates that the country’s structural deficit is now more than £12 billion larger than it was thought to be at the election. I do not know where he would have got that £12 billion from. As for pensioners, not only will we ensure that we restore the earnings link, but in April 2011 the full value of the cash increase in the state pension will go through to the poorest pensioners on pension credit.