Social Security

That would be a fine objective to aim for. As the Minister said earlier, the Government have—for good, persuasive reasons—concentrated on those whom they perceive to be the poorest pensioners. The great problem is, however, that the people on whom they have concentrated are not the poorest pensioners. The poorest pensioners are not those who are claiming pension credit and income support to bring them up to at least the minimum income guarantee; the poorest pensioners of all are those who are not claiming the allowances to which they are entitled. They are the ones who need to be targeted now. We should be aiming to provide a universal benefit that is as popular as child benefit—which is taken up by 99 per cent. of those who are eligible—and has no stigma attached to it. Sadly, however, we are not getting nearer to achieving that goal; we are getting further away. Any proposals for increases in benefits must take account of their affordability, as the Minister has rightly said. The cost of pensions and other contributory benefits falls on the national insurance scheme, and the Government Actuary's report shows that, once again, the fund is in extremely good shape. It is expected to end this financial year with a balance of £46 billion. Because the fund has no borrowing powers, the Government Actuary recommends that the year-end balance should be enough to meet two months' expenditure, but £46 billion is enough to meet eight months' expenditure. By the end of next year, the balance is expected to reach £57 billion, which will be enough to cover nearly 10 months' expenditure. The fund has been accumulating ever-increasing balances over the past 15 years, and this is set to continue. The Government Actuary's projection shows the balance trebling by 2013 to £115 billion, the equivalent of more than 16 months' expenditure. The process has continued under this Government. We started off with a balance of £500 million, and the amount has simply accumulated. It is often suggested by campaigning bodies such as the splendid National Pensioners Convention that, instead of building up these massive surpluses, the money should be used to meet part of the cost of an improvement in the state pension. That is a very persuasive argument. There is a standard response, which I have seen in numerous letters from Ministers over the years. They say:"““The National Insurance Fund is run on a pay-as-you-go basis. When there is a surplus, it is invested in gilts. If the surplus was used to increase benefits, the Government would need to raise the equivalent through other means such as raising taxes.””" That is a key revelation. In other words, the Government are deliberately collecting more money in national insurance contributions than is needed to pay benefits, and using the surplus for purposes which, however worthy they might be, have nothing to do with national insurance. This is a genuine stealth tax. I am sorry to have to use that term, as it has been vastly overused, and misused, by the Opposition. In the short term, this might be a convenient arrangement for the Government, but in the longer term, it can only undermine confidence in the whole national insurance system. Moreover, if national insurance contributions are regarded as just another form of taxation, the Government are open to the serious objection that the rich do not pay their fair share. They pay only 1 per cent. of their earnings over £670 a week, compared with the standard employee's contribution of 11 per cent. Personally, I pay nil per cent., because I am in the position, having passed retirement age, of not having to pay national insurance contributions. I have raised this matter with Chancellors in the past, and I would suggest to the Minister that, if the Government are looking for a way of raising money fairly painlessly, they could ask people who work after retirement age to continue to pay national insurance contributions. They can certainly afford to pay them, and there would be a great deal of justice if those fortunate enough to work after retirement age did so. That would raise £2 billion, and I believe that that is what should happen. At the moment, however, we have a situation that is leading to serious injustices in the system. I come back to the fact that I look forward to saying with pride at the next election what a marvellous job the Government have done over the last 10 years. As the motto of one of the schools in my constituency says, ““Nid da lle gellir gwell””—there is no good that cannot be improved upon. We have yet to reach perfection in the system, so I hope that the Minister will take account of what have hopefully been my many constructive suggestions.