Queen’s Speech

Lord Fowler Excerpts

Wednesday 3rd June 2015 Lords Chamber

[Lord Fowler (Con)]

My Lords, I congratulate the right reverend Prelate on his speech and welcome my noble friend Lord Prior to the Front Bench. We very much look forward to his contributions.

In opening the debate on the gracious Speech, my noble friend Lady Bottomley was kind enough to recall a period when I ran a department that covered both health and social security. One result of that is that I have a certain trade union solidarity with the two Secretaries of State who now carry those responsibilities, particularly when it comes to public spending and the Secretary of State for Work and Pensions. If my experience is anything to go by, Cabinet discussions on public spending go something like this. Ministers in other departments unite in saying, “We must tackle this social spending, grasp the nettle, kill the sacred cows”, and, worst of all, “It is just a matter of presentation”, the implication being that people will rather enjoy having their benefits cut.

However, if you go forward a few weeks to discussing the actual savings to be made and you put forward proposals such as the abolition of the universal Christmas bonus and the death grant, which at that stage cost more to administer than to pay out, the reaction is, “No, no, no”—and that was just from the then Prime Minister. The poor old Secretary of State is left trying to find savings in a smaller and smaller pool, because it was already the rule that pensions and help for the retired could not be touched. That remains the case today. If we believe the reports that we have heard this week, we are now to be constrained by a pledge not to fundamentally tackle child benefit.

Benefits for the over 60s and over 65s, such as the cold weather allowance and bus passes, march on untouched. We cannot even put an age qualification such as 70 or 75 on the bus pass. I declare an interest in that those two age limits would exclude many but not me. So I am not going to lay into the Secretary of State, who has a difficult task, but I will just say this: to announce £12 billion of cuts without saying where they will fall is a perilous venture—I could put it more strongly. Certainly, in my day, the Government would not have got away with such an approach; Michael Foot would have been on to us in a moment.

More importantly, I challenge the assumption, as I did 30 years ago in my social security review, that the elderly are by definition those most in need. Some are, but some are certainly not. I am equally concerned about the position of poor families with children, hence my proposal for a family credit. My hope is that any reductions in spending should proceed from an analysis of need. We should also make as much progress as we can with universal credit, which I think is one of the great pluses of this Government.

Turning very briefly to health, a whole range of issues fill the newspapers daily, from cancer treatment to the promotion of better health, but above the individual issues is the crucial financial question of how all this can be afforded; we have touched on this in the debate. The Secretary of State says that for the immediate future, and with the extra resources going in, the National Health Service should be able to manage, and I believe him. What I am not convinced about is whether in the decades ahead we can go on in the same way, financing health predominantly from general taxation. We should be clear about the consequences of this protected policy. Inevitably, public spending in other areas will be reduced. The Treasury will have to look elsewhere for economies. It will have to look at reducing spending on the police and on defence—incidentally, reversing the priorities of the Thatcher years.

There may be no option but to follow that course, but before we settle on it we should look at the options of financing health. I emphasise that the present model may be best, but let us at least look at the other options and set them out. That does not commit us, the Government or anybody else to a particular course, but it allows a foundation to be built upon which we can base policy. For example, we should look at whether a separate health tax has some advantage in connecting the public more directly with the cost of health. We should look at some kind of health insurance along the lines of what is done in France or Germany and see whether that is practical. We should look at whether patient charges could make a greater contribution, and we should look at whether the private sector could make a meaningful contribution to the training of the health staff it uses.

Those are all difficult questions and there is only one time they can be properly addressed: at the beginning of a new Government with five years to go. I would favour a royal commission, which incidentally was a private proposal made to me by Lady Thatcher, but one that was demonstrably independent, working openly and relying on the skill of organisations such as the IFS and the King’s Fund. The aim would be to show the options, to inform not just the Government but the public. In my view, we have a once and for all opportunity to carry out such an investigation. Timing is everything and that timing is, frankly, now. We will not be forgiven if we ignore that opportunity.