Hansard - United Kingdom Parliament

More documents

Recommendations

Info

87 Pensions Bill [Lords] 20 JUNE 2011 Pensions Bill [Lords] 88 Jonathan Evans: Hon. Members on both sides of the House will have received similar letters. The Labour party’s policy, as far as I understand it, is to begin the process in 2020. Therefore, those people would write similar letters—would they not?—if the policy adopted by the hon. Lady were pursued. Julie Elliott: That is absolutely right. The Labour party set out a similar policy of raising the pension age, but we would have done it by 2020, which would have allowed a considerable time for people to plan and to take that into account. The problem with the Government’s proposal is not raising the pensionable age, but doing so in such a short period. That is radically different from anything the Labour party proposed. The coalition agreement said that the state pension age would not rise sooner than 2016 for men and 2020 for women. The Bill breaks that coalition commitment. My constituents feel very angry and misled about that. Like many of the coalition’s ill-conceived policies, this is too much, too fast. 7.19 pm John Glen (Salisbury) (Con): I would like to open my remarks by reflecting on a tale of two 64-year-olds. My great-grandfather died in Salisbury in 1944. In the words of my grandmother, who is now 90, he was seen at the time as an old man. Next week, my father will turn 64. He will retire having done a manual job for 48 years, and with the expectation of perhaps living, as his father did, to 90 or 92. But we do not know, which goes to the heart of the problem faced by the Government: changing expectations of how long we will live and what to do about it versus the reality that decisions will have to be made with finite resources. I think that the Government have made an excellent start with this Bill, which addresses three interlocking issues. The first is our ageing population. Only a few weeks ago a lady came to my constituency surgery, sat down in front of me and asked whether I could help her. I said I would do what I could. I really thought it would be about an issue of care for herself or her aged husband, but in fact she wanted to talk about her 99-year-old mother. We have a ticking time bomb that, over the past two generations, Governments of all colours and parties and at all times failed properly to grasp. We cannot go on like that. Sheila Gilmore: Will the hon. Gentleman accept that it is a gross generalisation to say that this problem has been ignored? The Bill makes a relatively minor change compared with the major changes proposed in the Turner report and the last Pensions Bill. It is wrong to suggest that this has not been looked at. John Glen: I thank the hon. Lady for her intervention. I think I will address the thrust of her comments in a few minutes. The second issue is our active ageing population. Notwithstanding the remarks of the right hon. Member for Croydon North (Malcolm Wicks), who pointed out the differences in life expectancy between regions and socio-economic backgrounds, many people expect to lead an active retirement, which is why I welcome the proposal to remove the default retirement age. That will be important in allowing people to do more and to continue working if they wish. The third problem that the Bill addresses is the lack of saving. It has been said that 7 million people are not saving enough for retirement. The problem is the general sentiment that things will be all right on the night—people expect to be able to sell a property or make some money to put in a pension pot. The Government are facing up to these tough issues, and have realised that that is not a realistic proposition. I recognise that there is a gap between the long-term solution and the needs of those currently near the pensionable age, and many have acute concerns about what will happen—many Members have referred to the cohort of women who face a particularly tough time. All the indications are that the Government are prepared to acknowledge and address those concerns, and I am sure that my hon. Friend the pensions Minister will have an ingenious solution. However, I would like briefly to draw the House’s attention to a few specific issues. Despite the welcome introduction of the triple lock, it is clear that pensioners feel a great sense of vulnerability. They know that they have a reasonable expectation of living many years, and are anxious that at a time of low interest rates and little investment income their basic state pension should grow. I therefore welcome the Government’s proposal. I recognise that it will cost a lot of money and will take time to work out, but its general thrust is the right one. It has to be acknowledged that we have seen massive changes as a result of the increase in life expectancy over the past 50 or 60 years. Life expectancy at 65 has grown upwards of 10 to 15 years over the past two generations, and it would be helpful if the Government set out what we are aiming for. Notionally, we will have parity between genders over the next 10 years, but what are we aiming for? Are we saying that everyone should have a right to expect a fixed number of pensionable years? Are we seeking to address the statistical evidence on demographics and regional differences, or should we recognise, building on the comments of the right hon. Member for Croydon North about the level of complexity and a complexity deficit, that we will not be able to make the pensions system sufficiently complex to address every one of those factors? We have to recognise that we need to do something, particularly about the 33,000 women who face this two-year delay, but it would help if we set out some broader principles. My generation—those under 40—will have to bear a much greater responsibility. I expect to work much longer, although I might have a different job from my father, who worked on the land. We need to send the message so that the next generation and those after know to put more into their pension pots and expect to retire later. My hon. Friend the Member for Gloucester (Richard Graham) has already mentioned the fact that 10 million people now living will live to 100. That is beyond the realistic expectations or assessments of most people today, but it will impose strains on public finances, health care costs and end-of-life care, which are the issues that we must address. We must not fail to consider my generation and those that come after because they do not seem to matter today. I welcome the changes to auto-enrolment, but I ask the Government to avoid unnecessary and bureaucratic changes for small business people, especially those in the tourism or retail sectors, where staff turnover is high. Too often justice is not done in the detail to the
89 Pensions Bill [Lords] 20 JUNE 2011 Pensions Bill [Lords] 90 headlines of Government. We need to ensure that small employers do not bear a disproportionate cost. The free eye tests, free prescriptions, free bus passes, free television licences for the over-75s and the free winter fuel payments, along with the Government’s commitment to solidify the £25 payment in bad weather, are welcomed by many. Certainly, they are welcomed by the poorest members of my constituency—in Bemerton Heath and the Friary, for example—who rely on the payments year in, year out. I hesitate to say it, however, but is it really fair for those earning more than, say, £50,000 a year in retirement to have that extra money? There is usually a snigger, a gasp and a “Well, we don’t really need it”. However, in the assessment of true fairness, what value accrues to the public purse from expenditure on those people? I welcome the Bill, which establishes the right direction, but there is still work to be done in certain areas, which I hope I have set out. No Government, past or present, will get everything right. I applaud the work of my hon. Friend the pensions Minister and wish him well as he unravels these complex issues and develops a pensions system fit, in all respects, for the nation we live in and the number of years we can expect to live. 7.29 pm Teresa Pearce (Erith and Thamesmead) (Lab): Like many Members, I have been inundated with e-mails and letters from women who will be affected by the acceleration in the state pension age. I declare an interest, in that I was born between 1953 and 1955, and will have to wait longer for my pension. Last month I held a 90-minute Westminster Hall debate in which I outlined my opposition to the Government’s plans. The arguments that I put forward then still hold. The Government’s proposals are unfair, because they target a group of women based on when they were born and give them too little time to plan. These are women who have done the right thing—they have paid their national insurance contributions and planned for their retirement—and they should not be penalised by a Government who are moving the goalposts at the last minute. The Government are threatening to undermine confidence in the pensions system and some of the more positive proposals in the Pensions Bill, such as auto-enrolment, that are designed to improve pension coverage. However, people may think, “If the goalposts are moved at the last minute, why bother? We may make our contributions now, but who’s to say that the money will be there at the end, when we expect it?” That is the opposite of the Government’s intentions for pension reform, but it is a distinct possibility. When I held my Adjournment debate, not a single Conservative MP spoke. I am encouraged that we have had such thoughtful and wide-ranging contributions from all parts of the House on this important issue today. I also hope that the opposition expressed in this debate will cause Ministers to pause and rethink their plans. My early-day motion on the issue has gathered 177 signatures from all political parties, so there is widespread support in the House for a rethink. I would like to touch on the Secretary of State’s comments in today’s media. He said that it would cost in the region of £10 billion to drop the accelerated timetable, and that he would therefore stick to his plans. The Bill’s regulatory impact assessment says that the proposal will save no money before 2016, by which time the Chancellor says that he will have balanced the books. I am therefore unsure what the Secretary of State means. Is this about deficit reduction, or is it about fairness and equality? I would like to touch on some issues that have already been covered and put some further questions to the Minister. What assessment has his Department made of the proposal’s effect on the number of unpaid carers and child minders in the UK? The accelerated timetable means that many people who would have taken up caring for relatives or provided child care when they retired, in order that the next generation could join the work force, will not be able to do so because they will be at work for another two years. That will have an important social policy impact. What assessment has the Department made of the proposal’s effect on volunteering and the Government’s big society agenda? People who have retired are not inactive; they volunteer at libraries, charity shops and lunch clubs. They also act as school governors and provide much needed care in our communities. If they are kept in the labour market for longer, they will be less able to volunteer in those ways. I am also deeply concerned about unemployment among the over-50s. It is not easy for the women affected by the proposal to get another job or increase their hours to fill the two-year gap if they find themselves out of work, especially at such short notice. I receive many letters from constituents in their 50s who are willing to take any kind of work, but who are finding it impossible to get a job. It is not easy for people to return to the labour market once they have left. It is also becoming increasingly difficult to hang on to a job in later years. If women are expected to work longer, there needs to be work for them to do. That is particularly important given the current economic situation and the rise in unemployment. In looking for work, those women may well be competing against their own grandchildren in the labour market. What projections and costings have the Government made for how many women affected by the proposal will have to claim employment-related benefits? Many women will not have enough savings to fall back on, particularly those who have been employed in low-paid work or who have taken time out to have children or act as carers. Will the Minister outline the measures that the Government plan to introduce to help them work longer? Will he comment on how women who are not in work are meant to balance their finances in the two-year gap, given that they will be eligible for jobseeker’s allowance for only six months if they have savings or will not be eligible at all—this is my understanding—if they have a small occupational pension? I was going to mention some of the class issues affecting people’s life expectancy, but my right hon. Friend the Member for Croydon North (Malcolm Wicks), who is no longer in his place, went into that in great detail, and much better than I could. I would therefore like to end by asking the Minister about auto-enrolment and NEST—the national employment savings trust—which I broadly support. The three-month waiting period will mean that 500,000 fewer people will be automatically enrolled in a pension scheme. It is my understanding that workers will be able to opt in during that three-month period and receive the employer contribution, but people
Page 1 and 2: Monday Volume 530 20 June 2011 No.
Page 3 and 4: HER MAJESTY’S GOVERNMENT MEMBERS
Page 5 and 6: HER MAJESTY’S GOVERNMENT—cont.
Page 7: THE SPEAKER—The Rt Hon. John Berc
Page 10 and 11: 3 Oral Answers 20 JUNE 2011 Oral An
Page 12 and 13: 7 Oral Answers 20 JUNE 2011 Oral An
Page 14 and 15: 11 Oral Answers 20 JUNE 2011 Oral A
Page 20 and 21: 23 20 JUNE 2011 Eurozone (Contingen
Page 22 and 23: 27 Eurozone (Contingency Plans) 20
Page 28 and 29: 39 Points of Order 20 JUNE 2011 Poi
Page 30 and 31: 43 Pensions Bill [Lords] 20 JUNE 20
Page 76 and 77: 135 20 JUNE 2011 Private Gary Barlo
Page 78 and 79: 139 Private Gary Barlow 20 JUNE 201
Page 81: 1WS Written Ministerial Statements
Page 85 and 86: 1W Written Answers 20 JUNE 2011 Wri
Page 91 and 92: 13W Written Answers 20 JUNE 2011 Wr
Page 103 and 104:
37W Written Answers 20 JUNE 2011 Wr
Page 105 and 106:
Page 107 and 108:
Page 109 and 110:
Page 111 and 112:
Page 113 and 114:
Page 115 and 116:
Page 117 and 118:
Page 119 and 120:
Page 121 and 122:
Page 123 and 124:
Page 125 and 126:
Page 127 and 128:
Page 129 and 130:
Page 131 and 132:
Page 133 and 134:
Page 135 and 136:
101W Written Answers 20 JUNE 2011 W
Page 137 and 138:
Page 139 and 140:
Page 141 and 142:
Page 143 and 144:
Page 145 and 146:
Page 147 and 148:
Page 149:
Page 152 and 153:
Col. No. COMMUNITIES AND LOCAL GOVE
Page 154 and 155:
Members who wish to have the Daily
show all

Hansard - United Kingdom Parliament

Create successful ePaper yourself

Delete template?

Save as template?