Finance (No. 4) Bill

Debate between Eilidh Whiteford and Stephen Williams

Thursday 19th April 2012 Commons Chamber

[Dr Whiteford]

I agree entirely. It is about not only rural and transport costs, but increases in VAT, cuts in fuel allowances and so forth. All these things have put a real squeeze on people living on fixed incomes, who have little opportunity to find money from any other source. These have not been easy financial times for those on fixed incomes, who have been the forgotten victims of the financial crisis. It is not fair to say that pensioners have got off lightly so far from the public spending squeeze—quite the reverse. In considering changes to age-related allowances, we need to understand that the granny tax will tighten the screw on people who have already had significantly to tighten their belts in recent times.

Those affected by this measure are all living on below-average incomes. Most will have paid tax throughout their working lives, and most thought they were doing the responsible thing by saving for their retirement. Crucially, they do not have the opportunity to find alternative sources of income. They are on fixed incomes and are living off savings.

[Stephen Williams (Bristol West) (LD)]

Will the hon. Lady give way?

[Dr Whiteford]

I was about to wind up, but I would be delighted to take an intervention.

[Stephen Williams]

The hon. Lady just said that this group of people are on below-average incomes. That might be true across the broad span of the population, which includes people in work on enormous salaries, but for pensioners, surely they are on way-above-average incomes.

[Dr Whiteford]

The hon. Member for Leeds West pointed out that nobody on an income of more than £25,500 a year will be affected by this measure. Frankly, with average earnings above that, I do think that most of those pensioners are living in what most people would consider to be quite modest circumstances, particularly when, as I have already argued, they have to pay much greater heating costs. Their lifestyles are not without particular burdens that they have to bear, and they do not have a chance to improve them.