Social Security

I think the hon. Gentleman will be good enough to recognise that I have given way quite a bit, including to him. I turn now to whether the operating changes relate to people and families living in poverty and severe poverty. According to a paper issued last year by the Institute for Fiscal Studies, relative poverty in the United Kingdom rose in 2005-06—an increase of 400,000 before housing costs and 600,000 after housing costs are taken into account. The institute says:"““The rise in relative poverty is a direct consequence of the relatively low growth in low incomes between 2004-05 and 2005-06.””" Will the Minister give us his view on that and tell us where these benefit upratings fit into the general picture? There are important questions about not only relative poverty but severe poverty—that is, people living on 40 per cent. of contemporary median income. Again according to the IFS, the risk of severe poverty increased between the years 1996-97 and 2005-06. Will the Minister tell us where these benefit upratings fit into the picture, and is he prepared to give us any forecast on severe poverty? Strange as it may seem when one is talking about relative poverty and severe poverty, many of those in receipt of these benefit upratings will be subject to a fairly heavy burden of taxation—or what will be so for them. According to one survey, the poorest fifth of households pay a higher proportion of their income in taxes than any other group. Obviously, quite a lot of that will be accounted for by indirect taxation, but can the Minister give us any idea of how many of those in receipt of these upratings are paying direct taxation—that is, income tax or national insurance contributions? The underlying aim must be, wherever possible, to move people from the benefits system into work and to reduce the number of people subject to the upratings in the order. Let us take one example. Certain parts of the order increase payments to those in receipt of long-term incapacity benefits. I have already given the House the statistics on long-term incapacity benefits, which are striking. More than 55 per cent. of incapacity benefit claimants have been in receipt of incapacity benefits for more than five years and, under this Government, those on incapacity benefit for more than two years are more likely to die or retire than to get a job. There are also, strangely, several hundred thousand people under the age of 35 claiming incapacity benefit—500,000 altogether, including some who are very young. Will the Minister share with us any views he has on the incidence of long-term incapacity benefit claimants and draw the connection between getting at least some of those people off incapacity benefit and reducing the annual expenditure on benefits? In considering by how much expenditure on uprating can be reduced in future, will the Minister take into account the evidence that many people in receipt of these benefits, including incapacity benefit and the benefits uprated under the order, want to work and are being let down by the system as currently constructed? In a written reply to me last July, the national statistician told me that more than 2 million of the economically inactive want a job. That figure must include many of those in receipt of the uprated benefits under the order. Taking into account all those on out-of-work benefits, we estimate that nearly 5 million people are on such benefits, including many subject to the order—such as 2.6 million people claiming incapacity benefit, which is being uprated, and 837,000 people on jobseeker's allowance, which is likewise being uprated. Against that rather dismal background, can the Minister give us a sense of where he sees expenditure on these benefits going in future? Does he expect as much to be spent on these benefits in years to come because of the sheer number of people claiming? I appreciate that the order is an annual exercise, but it is not a model of simplicity, and the explanatory memorandum is not exactly forthcoming. It tells us what is happening in a very broad sense but gives us little insight into the details in respect of individual benefits. For example, how easy is it for a pensioner to find out what effects article 6(10) has on his or her entitlements under the Social Security Contributions and Benefits Act 1992 or the Pension Schemes Act 1993? In an attempt to scrutinise Government proposals such as this, the Social Security Advisory Committee asked the Minister's Department to provide what it called a complexity impact statement. It is salutary to read what the committee—the expert body charged with looking at the social security system and all such uprating orders—says in its most recent report. It says:"““We noted in our last report that these statements had told us little about either how the Department's guidelines on simplification have been applied in each case or about the impact statements that have been made subsequently. We have found this lack of exposure of the process frustrating and on the basis of the limited information that has been offered to us, we have been unable to judge whether any substantial progress is being made””." In short, these and other measures coming from the Department are too complicated for a complexity impact statement. If that is how the distinguished members of the Social Security Advisory Committee found things, what must they be like for the recipient who wants to find out more about their entitlements under orders such as this? To put it as the committee diplomatically did, there is a substantial barrier to full customer engagement. That is a good description of the way this Government so often operate.