Guaranteed Minimum Pensions Increase Order 2009

My Lords, these are important orders and this is an important debate. A lot of the upratings are done on the basis of formulas. I am absolutely content that the Government are doing what they are required to do under the provisions of 1992 uprating legislation. I shall try to concentrate on two points. First, I am very nervous about the extent to which childless, in-work family incomes are not being looked after as much as have been those of other categories of households in the past five or so years. It is obvious that one cannot give priority to everything but, looking at some of the figures for the support levels available under the new upratings, which take effect for rest of the year from April 2009, I fear untoward effects on people in that category simply because they are not among the target groups, such as families with children and pensioner and/or low-income households, on which the Government have rightly concentrated and where a lot of progress has been made. Will the Minister say a word about the future plans for that? We have seen organisations such as the Joseph Rowntree Foundation quantify what levels of regular and ongoing annual uplifts in the benefits system are necessary to reach the Government’s own targets of 2010 and 2020 for child poverty. I hope that the upcoming Budget will give us some sight of the Government’s programme for meeting their target. The figures that the Rowntree foundation have produced are robust and a large sum of money, in the region of £4 billion, is involved, but its work indicates quite clearly that, where the Government have specifically targeted sums of money of that order through the benefit uprating system, the result is directly consequential and child poverty reduces as night follows day. The mechanism works, but we need the consistent, year-on-year commitment to try to deal with the problem if we are to get where the Government want to be in 2010 and 2020. A lot of work needs to be done to ensure that. Another increasing problem is emerging in these rather strange financial times. I have no idea what is going on in the long term and wonder whether anybody else has; it is really quite dire. The Minister will of course know that when people are tested for eligibility for means-tested benefits, there is under the established rules an imputed level of income from capital sums. The imputed level of interest is much higher than anything that my bank manager is likely to give me any time soon in these new, maybe temporary circumstances. It must be unfair that low-income pension householders, when applying for means-tested assistance to which they would be otherwise entitled, find that the department says, ““Well, the interest from that £1,500 you’ve got, multiplied by 5 per cent””—or whatever the going rate is for the imputed level of interest—““takes you over the limit and therefore you are denied access to the means-tested benefit””. That is perverse and unjust in these financial circumstances. If we are in these uncertain times for as long as we might be, the Government will need to revisit the capital imputation rules for eligibility to means-tested benefits. I hope that the Minister will put pressure on his departmental colleagues, particularly in the Treasury, to address some of these longer-term—2010 and 2020—problems in the upcoming Budget. If they do not, the targets will not be met, which will be in no one’s interest.