Speeches, Interviews & Other Statements

Complete list of 8,000+ Thatcher statements & texts of many of them

1964 Jan 22 We
Margaret Thatcher

HC S 2R [Family Allowances and National Insurance Bill]

Document type:public statement
Document kind:House of Commons Speech
Venue:House of Commons
Source:Hansard HC [687/1181-1200]
Journalist:-
Editorial comments:2107-?2200.
Importance ranking:Major
Word count:6592
Themes:Autobiography (marriage and children), Taxation, Family, Social security and welfare, Women
1181

The Joint Parliamentary Secretary to the Ministry of Pensions and National Insurance (Mrs. Margaret Thatcher)

This, I think, has been one of the most enjoyable debates we have had on National Insurance for some time, and one which has contained a number of new ideas. A new book has been written, and whenever there is a major new work produced it is very quickly reflected in the debates in this House. I would start, therefore, by referring, in the first place, to these new ideas which have been produced.

The Bill itself is primarily a Bill about widows, and that was the reason for its being brought to the House at this time, but there are a number of people, as 1182the hon. Member for Pontypool (Mr. Abse) and my hon. Friends the Member for Carshalton (Captain W. Elliot) and the Member for Uxbridge (Mr. Curran) pointed out, who are in analogous positions and whose plight has been put forward in this debate.

I am referring to the new book entitled Fatherless Families. The speech which the hon. Member for Pontypool made was almost completely a precis of that book and of the reviews which have appeared upon it in many newspapers. I should like, therefore, to take the first opportunity of commenting upon it.

We have, as hon. Gentlemen have pointed out, various insurances within National Insurance and the Industrial Injuries Scheme for the fatherless child—for example, for the child who is completely orphaned, who has neither father nor mother, a guardian's allowance of 37s. 6d. We have provision for fatherless children who are the children of widows, and that is what we are mainly talking about today, and if the Bill goes through the mothers of such children will receive 37s. 6d. in respect of those children. The third insurance for children is for the children of the divorced woman whose former husband has died. If then he was supporting the child—and it is a very modest test of support—the mother of the child will get 37s. 6d. for the child.

Those are provisions insuring against some of the more normal insurance contingencies, such as the death of the father, something against which one can insure, but what we are being asked to do by some hon. Members is to insure against things which it is not possible to insure against. For example, it is not possible for a father to insure against things which it is within his control to bring about. One cannot have in an insurance scheme—National Insurance or industrial injuries—a father insuring against the possibility that he may desert his wife. One cannot have a father insuring against the possibility that he may have an illegitimate child.

Mr. Abse

Is the hon. Lady seriously putting forward the view that if, within his insurance stamp, there was cover in the event of the marriage breaking down, the fact that he was making that payment would make him more likely to commit adultery and desert his family? 1183Surely it is clearly an irrelevant issue. What the Parliamentary Secretary has put forward is quite fallacious, because it would not influence his personal conduct or his marriage one whit.

Mrs. Thatcher

I do not agree with the hon. Gentleman. It is not, in my understanding of insurance, possible to insure against things which one can bring about oneself, any more than it is possible to insure against setting fire to one's own house.

Mr. Abse

What about suicide?

Mrs. Thatcher

Under the National Insurance scheme we give benefit to a widow if her husband has committed suicide. That is an absolutely extreme case. It is much more unlikely that a man would take his life than that he would walk out on his wife, particularly as the suggestion is that there should be 50s. a week benefit for the child, because we might then well get the case where a family is suffering a certain amount of matrimonial difficulty and it would pay the mother handsomely if her husband walked out and deserted her. We sometimes get this under National Assistance as it is. One is constantly coming up against new aspects from individual cases.

I can well remember a National Assistance case, which I dealt with personally, where a man came to see me whose wife had walked out on him and left him. She had two children and the National Assistance Board was paying her nearly £11 a week because she was paying a high rent. We took the view that we had to relieve her need wherever she was. The man said to me, "If it had not been for National Assistance our marriage would have still have held together, because she would not have walked out unless she knew she would get a quick income from the Assistance Board".

That is a case which has actually occurred and which came before me. We take the view that under National Assistance we have to relieve need where it occurs. I do not think that we can insure a person against something over which he has control.

Mr. Mitchison

I always understood that one could insure at Lloyds against 1184twins. If one can insure against two, why not against one?

Mrs. Thatcher

I can assure the hon. and learned Gentleman from personal experience that that is something over which one has no control. Alas, I did not insure myself, and my husband was furious. The main point is that one cannot insure against something which it is within one's power to bring about.

The hon. Member mentioned Beveridge on this. From other things that he said, I think that it must be quite a time since he read the Beveridge Report and that he did not check the quotations. If he has recently read the Report, he will know that this is not a new point. Beveridge himself considered it, and I will quote what Beveridge said. There are in Mrs. Wynn's book certain selected quotations and some very important points are left out.

The Beveridge Report says:

"Divorce, legal separation, desertion and voluntary separation may cause needs similar to those caused by widowhood. They differ from widowhood in two respects: that they may occur through the fault or with the consent of the wife, and that except where they occur through the fault of the wife they leave the husband's liability for maintenance unchanged."

I now come to something which is not quoted by Mrs. Wynn. I will continue with the Beveridge quotation:

"If they are regarded from the point of view of the husband, they may not appear to be insurable risks ...".

Beveridge went on:

"... a man cannot insure against events which occur only through his fault or with his consent, and if they occur through the fault or with the consent of the wife she should not have a claim to benefit."

Mrs. Wynn quotes the next bit:

"But from the point of view of the woman, loss of her maintenance as housewife without her consent and not through her fault, is one of the risks of marriage against which she should be insured; she should not depend on assistance. Recognition of housewives as a distinct insurance class, performing necessary service not for pay, implies that, if the marriage ends otherwise than by widowhood, she is entitled to the same provision as for widowhood, unless—"

Mrs. Wynn leaves this out:

"—the marriage maintenance has ended through her fault or voluntary action without just cause. That is to say, subject to the practical considerations mentioned in the note below she should get temporary separation benefit ... and guardian or training benefit where appropriate."
1185

The practical considerations mentioned in that note are:

"There will often be difficulty in determining responsibility for the break-up of the marriage. There will in cases of desertion be difficulty in establishing the fact or the permanence of desertion."

The hon. Member knows how invidious it is sometimes in cases in the courts to allocate the responsibility for the breakup of a marriage, and to ascertain in the magistrates' courts whether there has, in fact, been desertion and whether the desertion is permanent.

The note goes on:

"There will in all cases be the problem of alternative remedies open to the wife."

It goes on:

"It may for practical reasons be found necessary to limit the widow's insurance benefit to cases of formal separation, while making it clear that she can in all cases at need get assistance and that the Ministry of Social Security will then proceed against the husband for recoupment of its expenditure."

Beveridge gave, I think, a very much fairer picture of the problems involved than we have yet heard in this debate, and I think it is only fair to quote him very nearly in full when he was considering this problem. In fact, he could not come to a solution of it.

While I am referring to the book, I would point out that attention has been drawn to one of the big tables in it. I have not been through the table minutely, but I think that the hon. Gentleman will have noted that most of the insurance figures are out of date, because they refer to the period before the last general increase last May, which the House approved at an increased expenditure of £227 million a year. There is, however, a column in that table which would seem to indicate that widows' benefits are taxed as unearned income. I am authorised by the Treasury to say that that is false; they are, in fact, taxed as earned income. This is a fallacy which is often repeated, and I am, therefore, glad to be able to tell the House quite authoritatively that widows' benefits are taxed as earned income and not as unearned income.

That brings us to the provision made by the State for fatherless children outside the insurance provisions which I have already mentioned. The hon. Member was a little disparaging of the National Assistance Board. In fact, he 1186was more than disparaging of it; he was almost unkind about it. Those of us who have attended these debates in the House for some considerable time have the greatest admiration for the work done by the National Assistance Board, as the hon. Member for Wallsend (Mr. McKay) said.

Mr. Abse

Would the hon. Lady explain in what way anything I said disparaged the National Assistance Board? All I said was that these women should be able to have assistance by way of right. Surely that is no reflection on the Board? I take exception to the suggestion that I in any way criticised the officials of the Board. We are aware that in every area they are doing a good job of work.

Mrs. Thatcher

The hon. Gentleman said that they would have to go begging to the Board. I thought that he used the word "shame". I distinctly remember that he said they would have to go begging to the Board. This does not help to get those who are in need of assistance to go to the Board. Quite the contrary. It might stop them when they would otherwise go very quickly.

The Board makes provision for all cases of need and does not distinguish, for the purpose of benefit, between the mother who is unmarried and the mother who is married. It relieves the need which is there, and that is quite right. The needs of the fatherless family are assessed in the same way as those of other people in need—by reference to the common scales of assistance set out in the regulations.

For example, the mother will receive £3 3s. 6d. a week, each child under 5, 19s. 6d. a week, each child over 5 but under 11, £1 3s. a week and each child over 11 but under 16, £1 8s. per week. Those over 16 can apply for assistance in their own right. To that is added a rent allowance and then there are fringe benefits, such as a pint of milk each day for each child under 5, cod liver oil and vitamins. The Board also gives people who have been on National Assistance quite a time special grants for the replacement of clothing, house-hold goods, etc.

Several hon. Members, including my hon. Friend the Member for Torrington (Mr. P. Browne) and the hon. Member 1187for Pontypool have commented on disregards. These have never been intended to bolster up the standard of living or income. The system is based on providing for all essential needs and for bringing a person's income up to a level at which those needs can be provided. The strictly logical way, therefore, would be to have no disregards at all, but that would not be practicable and would frustrate any voluntary organisation which wanted to give help.

If, for every 1s. one earned, one lost an extra 1s., one would not benefit at all by one's own efforts, so this is, therefore, a recognition that we need something so that people shall be able to help themselves a little without losing benefit and that other people, such as voluntary organisations, shall also be able to assist. If we were to have a separate disregard according to the number of children, this would mean that a woman with several dependent children would have exactly the same allowances from the Board as a woman who had, say, £6 or £7 extra, and that would not be right, at any rate under the Board's present terms of reference, which instruct it to make income up to a certain standard so that a woman can meet her commitments.

Where there is a maintenance order and the woman is regularly in receipt of National Assistance, she can submit that order to the Board, which may take over the collection of the maintenance and pay her a regular supplement. This often helps tremendously because maintenance has a way of being very erratic in reaching a deserted or separated wife.

Sir S. Summers

Does that mean that the Board will also assist in tracing the person due to make the maintenance?

Mrs. Thatcher

The Ministry itself does all it can to assist in tracing these people. It will supply the whereabouts of the husband to the clerk of the magistrates court or to the registrar of the High Court in order to enable maintenance proceedings to be brought. The trouble often is that we do not know the latest address. In some cases the Board will take criminal proceedings against a man who persistently and wilfully refuses to maintain his dependants. 1188

I am sorry to have to come back to the hon. Member for Pontypool, but I have nearly finished with him. He said words to the effect that people were beggared to go to the National Assistance Board and pointed out that in New Zealand, Australia and Denmark there are allowances for fatherless children.

I have said that in this country we have a certain amount of insurance and a great deal of National Assistance, so that everyone is looked after. I hope that the hon. Member for Pontypool will bear that in mind. In Australia, widows' pensions are payable subject to a means test on income and property and to residence and citizenship qualifications. Allowances for dependent children are payable to widowed mothers and for this purpose a widow includes a deserted wife, a divorcée, a woman whose husband has been in prison for at least six months, and a woman whose husband is in a mental hospital.

A deserted wife or divorcée who has not taken reasonable action to obtain maintenance from her husband or former husband is not eligible for a widow's pension. The Australians, therefore, have nothing more than we have. In fact, it is all subject to a means test whereas we have at least some insurance provisions for the widow.

In New Zealand, widows' benefits, including allowances for dependent children, are available to widows and the wives of mental patients and to deserted wives provided that they have applied to the court for a maintenance order and subject to a means test on income and to residential qualifications. The New Zealand benefits, including those for widows, are all subject to a means test.

In Denmark, widows' benefits, including allowances for dependent children, are payable subject to a means test and to citizenship and residence requirements. Assistance provisions for other fatherless families are available subject to maintenance conditions on the other parent or putative father.

Apart from the above provisions, there do not appear to be any special allowances payable to fatherless children apart from any supplementary assistance arrangements details of which are not known. 1189

This has been confirmed verbally by Australia House, New Zealand House and the Danish Embassy. It is therefore, Quite misleading to say that Australia, New Zealand and Denmark have better provisions than we have. In fact, the boot is on the other foot.

Mr. Abse

Although clearly subject to a means test, is not the hon. Lady evidently saying that they have provision for separated wives? That was the point which Margaret Wynn was making and it is the point which I was trying to make. Even though subject to a means test, there is insurance provision for the separated wife.

Mrs. Thatcher

We have provision for a separated wife in National Assistance. Many countries would not be giving the separate provisions if they had, as we have, the very wide terms of reference of the Assistance Board to provide relief and help to make people's incomes up to a certain minimum regardless of where that need is, or whether it is a separated, or deserted wife, or widow, or old person. So much for some of the remarks on that book.

I now turn to some of the comments of the hon. and learned Member for Kettering (Mr. Mitchison), which were echoed by a number of hon. Members, about the provision connected with the age of 19. One of the questions has been why there should be a fixed limit at all and why it should not be until education of the child is completed, so long as the child is a dependant. At the same time, we are being asked not to make National Insurance provisions complicated, but to make them simple. Every demand which is made would introduce a new Amendment which would result in increasing the complexity of the Act. One of the reasons why we resisted changing the age of 18 was that throughout the Act 18 was the age at which a person became an adult. As a result of the Bill, we have introduced a complexity in that there are some times when a child is an adult at 18 and some times when it is not.

We have tried to keep the number of anomalies to a minimum. One of the qualifying conditions for widow's pension is that the widowed mother should be 50 when her child becomes what used to be 18 and is now 19. The widow with 1190one child, even when the child becomes independent, if he is less than the age of 19 and still lives at home with his mother although she is earning, will qualify for the widowed mother's personal allowance until that child reaches the age of 19 if the Bill goes through, against 18 at present.

If we were not to make that period end at a specified age but dependent upon the end of education, we think that it would put an almost intolerable burden on the child, who would be under very great pressure to continue education, regardless of whether he was a suitable subject or not, in order to qualify his mother for widow's benefit if the age of 50 was reached by the mother during the critical time. As it happens, at the moment the child's wishes in the matter are neither here nor there, as the allowance finishes at the age of 18 and will finish at the age of 19 if the Bill is passed. That is one of the main reasons for having a fixed age.

We also think that this prevents unfairness between one case and another. There used to be a provision when under a Labour Government the age was only 16, for using the date 31st July after the age of 16 had been reached. That led to much unfairness between one case and the next according to whether the age of 16 was reached shortly before or shortly after the 31st July. We decided to go to a particular age and first increased it to the eighteenth birthday and now, by the Bill, it will be increased to the nineteenth birthday.

Another point which has to be considered is that we keep the definition of "child" the same throughout family allowance and National Insurance dependency provisions. If we were to make it right up to the finish of education regardless of when that occurred, whether at 21, 22 or 23, the family allowance would continue in payment during that time and may well be paid to a number of people whose children were already in receipt of adequate sums from the State for continuing university education and who, in any case, were well able to cope with their children without additional help.

Particular reference was made to a case where benefit ceased to be paid 1191when the child reached the age of 18. I want to make clear that, as my hon. Friend the Member for Tynemouth (Dame Irene Ward) said, the Bill was conceived as a widows' Bill and that one of the main reasons for making this change was the beneficial effect for them, particularly for widowed mothers. We then had to consider repercussions on the rest of the scheme. We had to consider that unemployment and sickness beneficiaries would have to receive extra entitlement for children up to the age of 19.

Slightly different considerations may arise. All kinds of people nowadays draw unemployment as well as sickness benefit. There is the person who retires at 60 and is in an occupational scheme, but wants to continue a job after he retires and enjoy an increased standard of living until he is 65. He often goes to the employment exchange and may be in receipt of unemployment benefit for the full period of 19 months, yet he is in quite a comfortable position because of a very good occupational pension scheme. Often he has a child at university and will be benefiting from this provision as well as a widowed mother.

We considered the case of sickness benefit, which illustrates the point rather more cogently. Over 50 per cent. of the working population are now covered by sick pay schemes. Nevertheless, in many cases, when a man claims sickness benefit he will have full or part salary, or from a sick pay scheme full sick pay perhaps for himself and a dependent wife and children, and, if he has a boy at university, a State grant for maintenance and also the family allowance. In his case he will be receiving a salary with tax relief for the oldest child and he will be receiving full sickness benefit, none of which is liable for tax, and family allowance, which is liable for tax, in respect of a child which is probably receiving benefit under a full university grant.

We have to consider this type of case, and this is one reason why I told the hon. and learned Gentleman that this is the kind of case which can often be dealt with better by discretionary grant from the local authority, as it is by the present Bill. We shall be increasing the benefits 1192for all these people by increasing the age from 18 to 19 and thereby extending family allowances as well as the title to dependency provisions. We have to keep one kind of benefit in line with another in the scheme, and it was not possible to exclude, nor do I think it desirable to exclude, those on unemployment benefit or sickness benefit, because there are many hard cases, too. This is one reason why I said to the hon. Gentleman that perhaps if there is a hard case one can get the money to it better from a local authority.

The discretionary system often benefits people far more than a rigid insurance system. Where there is a discretion, often those people whose need is greatest get far more than they do under a rigid insurance system. But local authorities vary enormously one from another, and although there may be discretion to help a person, the standard of help given to the widow or the person with a dependent child at college varies very much. We therefore thought fit to deal with the bulk of the cases now by increasing the age limit from 18 to 19.

The hon. and learned Member, and a number of other hon. Members, referred to the earnings rule. The first point which arose was a question why we had chosen to make this change by legislation and not by reference to the National Insurance Advisory Committee. One of the main reasons was that if we wanted to get this through, as we hoped, by 30th March, there simply was not time to lay the matter before the National Insurance Advisory Committee. As the hon. and learned Member probably knows, we should have had to draft and lay regulations. These regulations would have had to be advertised and 28 days would have had to elapse. Representations would then have been received by the Advisory Committee, which would have had to consider them. The Committee would have to have one meeting and possibly a second meeting. It would then have made its recommendations to the Minister, who would have had to put them into effect by means of an affirmative Resolution, which, I believe, takes at any rate three weeks to get before the House.

Mr. Mitchison

Is not this why in Section 77 there is provision for the 1193Minister to certify that on account of urgency or any special reason regulations should come into operation without delay, and to put them into operation without delay?

Mrs. Thatcher

Why not put it in the Bill when we have a Bill before the House by which to do it? In addition, it is part of the provisions for widows, and we were anxious to draw attention to the fact that this is a widow's Bill and to make it quite clear that this is part of the provisions for widows.

I also point out that this is amending a Section of another Act. This is a view taken by lawyers and I therefore mention it to the hon. and learned Gentleman: the regulations would not merely have been amending regulations, but would have been amending a Section of an Act, and some lawyers I know take the view—including one very eminent lawyer who has put the view to me—that where we are amending an Act of Parliament we should do so by an Act.

Mr. Mitchison

No doubt that is so, but the hon. Lady's Ministry has twice done the same thing by regulations. Every time it has been done before it has been done by regulations. Why not do it again?

Mrs. Thatcher

We have had the power to do it by regulations only since 1956. There have been analogous cases where we could have done things by regulation, but if we have legislation before the House we have sometimes put the changes into the Bill.

The hon. and learned Gentleman also talked about the amounts. Sometimes the amounts are raised only by reference to the increases in average earnings. Thus the amounts are raised so as to make the limit at which the earnings rule operates realistic. There is another type of change, which is a definite advance in the earnings rule. Last time it appeared to be an increase to keep the value of the limit where it was in real terms, but again that has not always been the case. In April, 1959, and March, 1960, the earnings limit for widowed mothers was raised within that year from 80s. to 100s. That was a similar increase to what this now is. It is a definite advance in the direction of relieving a greater amount of earnings. 1194

One or two of my hon. Friends have asked for really up-to-date figures on the cost of abolishing the earnings rule. My hon. Friend the Member for Torrington said that he did not believe the figure of £100 million. My hon. Friend the Member for Uxbridge has expressed a similar view on other occasions. I have got a really red-hot figure——

Hon. Members

Hear, hear.

Mrs. Thatcher

I am very glad that I am not wearing a red dress today.

To continue, I have a bang up-to-the-minute figure, and it is £110 million, based on the earnings limit in the Bill and upon the rates of benefit now paid. Although the earnings limits have been raised, the rates of benefit payable have been increased. The largest part of this figure would consist of paying pensions to those who are at present deferring retirement. The figure for abolishing the rule for widows and widowed mothers is £6 million, assuming that the Bill becomes law.

The hon. and learned Gentleman and other hon. Members made some points about the averaging of earnings. This point was dealt with by the National Insurance Advisory Committee in 1956, and it reported on it at some length. It came to the conclusion that the disadvantages of such a system would outweigh the advantages. The Committee pointed out that, on the average, some pensioners would be worse off. In cases where the person has kept just below the current earnings limit and then suddenly gets a bonus, if that bonus is averaged it will clearly affect the amount of benefit for a large number of weeks. If it is not averaged and stays for only one week, it will affect the benefit for only the following week.

The Committee also explained that at the end of the averaging period when adjustments came to be made a pensioner might be left for a time with neither pension nor earnings. This could not be dealt with week by week. It would have to be averaged in retrospect over a year, in which time the pensioner might have been paid more pension on the average than the averaging would warrant, and just at the time when he had stopped work and his earnings had 1195gone right down he might have his pension benefit withdrawn because of his past earnings, and, as the Committee pointed out, be left with neither pension nor earnings.

I was grateful to my hon. Friend the Member for Action (Mr. Holland) for referring to the subject of increments. If the earnings rule were abolished for retirement pensioners, many pensioners who now manage to increment their basic pensions by deferring retirement—and thereby manage to incur for themselves a pension of up to about 30s. a week more than the basic pension—would not be able to do so. The increments provision of the National Insurance Scheme is an important one which assists people rapidly to increase their weekly incomes by deferring their retirement.

A number of comparisons have been made between the Industrial Injuries Scheme, the War Pensions Scheme and the National Insurance Scheme. The hon. Lady the Member for Lanarkshire, North (Miss Herbison) referred to some comments which were made in 1963. She was probably referring to one or two of the early White Papers on social insurance consequent on the publication of the Beveridge Report. Some of her references might even have been from speeches which I made. As to the case for a separate industrial injuries benefit fund, either there is a case for making separate provision for disablement or injury due to a special cause or there is not. Parliament has hitherto taken the view that there is a special case for having special provisions, over and above the ordinary sickness benefits, for these cases.

It is logical that if one takes the view that disablement arising from an industrial cause should give title to a special benefit, one should also take the view that the death risk from an industrial cause should give title to preferential benefit. That, as I understand it, is the view that has been taken. Justification for this was given in the White Paper "Social Insurance, Part II, Workman's Compensation, Proposals for an Industrial Injuries Insurance Scheme", Cmd. 6551, September 1944.

Mr. Mitchison

We respect, the hon. Lady has misunderstood the point. We 1196agree that those in receipt of industrial injury benefits have had better treatment. We do not disapprove of that. What is the logic of having an earnings rule in the National Insurance Act and not having one in the Industrial Injuries Act? It is nothing to do with the amount of benefit. If the rule is right in one case it is surely right in the other; or if it is wrong in one case, is it not wrong in the other?

Mrs. Thatcher

I cannot agree with the hon. and learned Gentleman. It depends on the principles of the insurance applying to the two different schemes. National Insurance is based on the concept of absence of earnings and one is insuring against being unable to support oneself by one's own efforts. The Industrial Injuries Scheme is based on entirely different concepts, partly due to historical reasons, and it has an element of compensation in it, as the hon. and learned Gentleman knows.

The hon. and learned Gentleman asked where the logic was in having something applying to one scheme and not to another. I cannot see the logic of choosing one feature from one scheme and saying that because an industrial injury widow is treated better from the point of view of earnings, one should abolish the earnings rule for widowed mothers in the National Insurance Scheme. If one is going to compare one scheme with another, one should not merely accept one feature but compare the benefits at every stage.

If one asks why an industrial insurance widow should do better from the point of view of earnings, why should she have a preferential rate of benefit of 7s. 6d. over the National Insurance widow? The hon. and learned Gentleman is driving at ultimately having the same provision for widows, regardless of whether widowhood resulted from industrial injury or otherwise.

If hon. Members opposite want to abolish the death benefit provisions of industrial insurance I am sure that, if they talked the matter over with my right hon. Friend, they would see that it would go a long way to making his administrative task simpler. In the meantime, it would be absurd to attempt to justify the existence of a scheme and to 1197justify its differences—its preferential rate—and then to complain of the very preferences which that scheme gives.

Miss Herbison

The hon. Lady is now being completely illogical. In the first instance, the woman widowed by industrial injury gets a higher weekly benefit, and I do not think that a single Member on this side of the House makes any objection to that. That widow gets the higher benefit because she comes under a completely different scheme. Our one objection is that the one widow has an earnings rule applied to her and the other has not. For the Joint Parliamentary Secretary to suggest that the abolition of the earnings rule in the one scheme means making both schemes completely alike is just nonsense.

Mrs. Thatcher

Nevertheless, we would have a number of hon. Members pointing to the difference in treatment between two widows living next door to each other, one drawing the industrial injury widow's benefit and the other the widow's benefit and the other the widow's benefit under the National Insurance Scheme. That is one of the things that those who do not appreciate the two schemes often call an anomaly.

Miss Herbison

The hon. Lady is now basing her case differently, by saying that if she allows the earnings rule to disappear for the ordinary widow, someone, or some party, will say we should abolish the other. She is not giving any valid reason at all for not abolishing the earnings rule for the widow who is receiving her money through National Insurance—none at all.

Mrs. Thatcher

I think it quite illo-illogical to take one feature of the one scheme and, because that is different, to say that it must apply to the National Insurance scheme.

A number of hon. Members, particularly the hon. Member for Mansfield (Mr. B. Taylor) referred to the 20s. widow under the Industrial Injuries Scheme, something for which there is no counterpart in the scheme. The case of this category of widow has been referred to the Industrial Injuries Advisory Council. The reference was made on 3rd January, 1964, in the following terms: 1198

"To review the provisions governing death benefits for adult dependants under the National Insurance Industrial Injuries Act, 1946, other than the provisions relating to the higher rate of widows' pension under Section 19(3), and to report."

We shall receive that report in due course.

Once again, a number of comments have been made about the 10s. pension, and my hon. Friend the Member for Torrington spoke very succinctly. I would point out to those who are not always with us in these debates that the vast majority of these 10s. payments have come into existence since 1948, and are still coming into existence. During the last five years there have been 35,000 new cases, so it cannot be said that all these are people who have been receiving 10s. a week ever since pre-1948.

Of those in receipt of this payment, 84,000 are under the age of 60, many of them being those who did not qualify for full National Insurance benefit, either because they were over 50 when they were widowed or were under 50 when their children grew up. Most of them will qualify for full retirement pensions in the ordinary way. Another 27,000 are over 60, and a great many of these, also will qualify for retirement pensions when they retire. Only about 11,000 of them are over 65. A considerable number of these are on National Assistance, and it would not benefit many of them if their pensions were increased.

The hon. Member for Feltham (Mr. Hunter) suggested that 30s. would restore the 1948 value. It would require 7s. 5d. to restore the 1948 value. Many comments have been made about an election and the Bill. Whenever we have a National Insurance Bill someone opposite always asks, "When is the General Election?" If hon. Members opposite go on saying it long enough they are bound to get an answer some day. I would point out that there have been improvements in benefits for widows every single year under the Conservative Government from the year 1955 and I propose to go through them.

In 1955, there was a general increase in benefit rates. Personal benefits were increased from 32s. 6d. to 40s. Benefits to all children were increased from 10s. 6d. to 11s. 6d., and the benefit to the first child from 2s. 6d. to 3s. 6d. There were several improvements in 1956. The allowance for the children of widowed mothers 1199was increased by 5s. from 11s. 6d. to 16s. 6d., and from 3s. 6d. to 8s. 6d. for the subsequent child. Again in that year the widowed mother's personal allowance was introduced to help widowed mothers to maintain the home for adolescent children who left school.

The 10-year marriage rule was replaced by the three-year rule. The pension age limit was raised from 40 years to 50 years. The benefit rule for widow's pension and widowed mother's allowance was relaxed by the introduction of the 20s, band with proportionate deductions. In 1957, there was the introduction of arrangements to enable widows not entitled to long-term benefits to qualify for sickness and unemployment benefit irrespective of the insurance record. This arrangement also applied to the 10s. widow and was a valuable concession.

Miss Herbison

The hon. Lady has had a considerable time to reply and all I want her to give the House and the country for each year when these increases were made are the increases made in contributions. This is a bit of propaganda. We want the whole story, including the increases in the contributions and the money which the Government are getting from the swindle of the graduated pensions scheme.

Mrs. Thatcher

The hon. Lady tries to interrupt me when I have only two minutes left to reply and I am giving the facts of what the Government have done.

In 1958, there was a general rate increase. The personal benefit rate was increased from 40s. to 50s. and all the children's allowances were increased. In 12001959, the earnings limits were raised, and again in 1960. In 1961, there was a general benefit rate increase. The allowance for widows' children was increased by 5s. to £1 5s. for the first child and 17s. for each subsequent child. In 1962, there was the implementation of the provision whereby certain widows were able to receive half the rate of increment of the husband's insurance.

In 1963, there was a general rate increase. Personal benefit was increased to 67s. 6d. The allowance for widows' children was increased by 5s., and 26s. of the widowed mothers' allowance was exempted from the earnings rule and the earnings limit was increased. In 1964, the allowance for children is to be increased to 37s. 6d. for each child, including the family allowance, and the earnings limit raised to £7 for widowed mothers and £5 for widows. I have left out a number of extra things.

Miss Herbison

What about the contributions?

Mrs. Thatcher

As the hon. Lady knows, contributions for widow's benefit, sickness and unemployment benefit and retirement pensions are not separated and are, therefore, not comparable with the figures which I have given. In spite of the noisy reception, I hope that the House will welcome the Bill and will assist us in its speedy passage so that the widows can receive the benefit.

Question put and agreed to.

Bill accordingly read a Second time.

Bill Committed to a Committee of the whole House.—[Mr. Peel.]

Committee Tomorrow.