That's the conclusion being drawn by veteran pensioners' campaigner Jack Jones in the light of the proposed new Pension Credit and extension of the Minimum Income Guarantee (MIG).

"The logical conclusion of this government's pensions policy would be to create a growing number of pensioners dependent on means-tested benefits" he says.

Even Pensions Minister Jeff Rooker has admitted in a written parliamentary answer that within two years - by 2003 - an additional 1. 1 million pensioners will rely on the MIG.

"It is widely accepted that when combined with the new Pension Credit proposal, a total of 5.5 million pensioners face means testing in one form or another."

Jack welcomes recent increases in the basic state pension, but is urging the government to address the dilemma of not giving large across-the-board increases because everyone would get them, including the wealthy, by adopting a simple remedy: "Use the tax system to ensure that those who can afford it pay more"

He says that the National Insurance system and universal state pension are two key elements of the welfare state and have been attacked over the years by both Conservative and Labour governments.

The Tories, he says, slashed the link with earnings and encouraged people to take out Private pensions.

And since 1997, the Labour government has tackled the problem of pensioner poverty by increasing means tested benefits and gimmicks.

'The basic state pension is a fundamental part of our welfare system and the NI contribution method is the cheapest to administer. Means testing remains the most cumbersome and administratively bureaucratic way of tackling financial hardship in retirement.

'Means tested benefits fail to reach some of the very people they are supposed to help" he says, highlighting the 500,000 pensioners who are entitled to receive MIG but do not do so.

He underlines his case by pointing out that the cost of re-establishing the NI Principle is not prohibitive, with a reported surplus of £10.5 billion in the NI fund and expectation of this rising to £12.2 billion by 2003.

"A recent report from the Government Actuary also states that the link with earnings could in fact be restored without any increase in contributions until 2007/8.

He admits that in the longer term the Actuary's report warns that the NI rates 
would have to increase from just over 20 per cent now to just under 30 per cent by 2060/61.

But such an increase, he says, should be viewed in the light of the expected increases in the standard of living over the next 60 years which would result in real earnings growth of 1.5 per cent per annum. "Even with higher contribution rates, real net income would still be significantly higher in 2060 than it is now."

He adds: "The provision for retirement is as much the responsibility of the community as a whole as it is of the individual and a society in which one quarter of the population spend the last 20 years or more of their lives in or on the borders of poverty is a society that has renounced that responsibility, We cannot allow or afford that to happen."