House of Lords
Death of a Member: Lord Moran
The Lord Speaker (Baroness D'Souza)
My Lords, I regret to inform the House of the death of the noble Lord, Lord Moran, on 14 February. On behalf of the House, I extend our condolences to the noble Lord’s family and friends.
Courtesy Titles
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Deech
To ask Her Majesty’s Government what plans they have to promote equality in the use of courtesy titles.
Lord Wallace of Saltaire (LD)
My Lords, while the Government recognise the equality issues surrounding the use of courtesy titles, we have no plans to alter their use due to the complexity of the system and the likelihood of confusion arising from alteration to the long-standing custom and practice governing this matter.
Baroness Deech (CB)
I can assure the Minister that, having looked into the issue, it is not as difficult as he imagines and that there could be change. Does he not agree that equality has to start in this House and that the use of the title “Lady” by the wives of knights and noble Lords is discriminatory unless a title of some sort is also accorded to the husbands of noble Baronesses and dames? Either the title should be used only by those to whom it was awarded, or husbands and wives and partners have to be treated equally.
Lord Wallace of Saltaire
My Lords, I think the statement that equality must start in this House is one which will be received with surprise by a number of those outside. I thank the noble Baroness for encouraging me to read Debrett’s for the first time. Having read Debrett’s for the first time, I know this is a highly complex issue. I recognise that the use of courtesy titles and titles for the spouses of Peers—which are apparently legal titles, not courtesy titles—has grown up over the past 500 to 600 years. The rapid changes in the relationship between the sexes and in marriage over the past 50 years have, of course, left us with a number of anomalies, of which the Government are well aware, but we are not persuaded that it is urgent to adjust them now.
Lord Dholakia (LD)
My Lords, now that same-sex marriage is on the statute book and will be implemented before long, has the Minister given any serious thought to the award of knighthoods—or damehoods for that matter—to people who have entered into such relationships?
Lord Wallace of Saltaire
My Lords, that is taken care of within the Marriage (Same Sex Couples) Act 2013. I understand that exceptions have been made for this in that Act and in the earlier Marriage Act. The coalition Government and, I am sure, all parties are much concerned about the weakness of social mobility in Britain. I am not sure that we should spend too much time concerning ourselves with the subtle finesse of social stratification.
Lord Hunt of Kings Heath (Lab)
My Lords, that was a truly Conservative answer. The noble Lord has spent far too long on that Bench. My question is entirely relevant to the question of courtesy titles. Can the Minister confirm that the Government are intending to introduce yet another list of new Peers to your Lordships’ House? Can the noble Lord reassure me that that is not the case?
Lord Wallace of Saltaire
My Lords, I am not informed on the subject so I can neither assure nor reassure the noble Lord. I have asked some female colleagues in this House how much their husbands care about not having a title and a number of them have told me robustly that their husbands not only do not care but positively do not wish to have them. I am aware that a number of wives of Members of this House do not use their courtesy titles either.
Lord Trefgarne (Con)
My Lords, given that we changed the law of succession for the sovereign only last year, are there any plans to change the law of succession for hereditary peers rather than the question of courtesy titles?
Lord Wallace of Saltaire
My Lords, we spent some time on Fridays on a Private Member’s Bill on this very question. The House was some way from consensus on it the last time we debated it.
The Countess of Mar (CB)
My Lords, is the noble Lord aware that there is a precedent? In 1392 and 1408, when there were two Countesses of Mar in their own right, their husbands were made Earls for their lifetime on the basis that the women could not go to war or sit in Parliament. However, I have asked my husband and he said that he does not want to be Earl of Mar because he neither wants to go to war nor to sit in Parliament.
Lord Wallace of Saltaire
My Lords, I am very grateful for that remark. I was aware of that precedent and I am told there was another Scottish precedent, from the 16th century, in which the husband was refused the appropriate title.
Baroness Sharples (Con)
My Lords, is my noble friend aware that I have actually killed off three husbands so perhaps the question does not arise for me? Are there not much more important matters that the Government should be concerned with?
Lord Wallace of Saltaire
My Lords, when the Opposition Front Bench accused me of being Conservative it was precisely because I was saying that the Government think there are other more important things. I would have thought that the Opposition Front Bench might agree with that.
Baroness Howarth of Breckland (CB)
My Lords, I accept that there may be more important things to contend with at the moment, but this is a question of equality. I was concerned by the noble Lord’s reply that it was too complex. Does he remember that, at one time, it was too complex to give women the vote?
Lord Wallace of Saltaire
My Lords, the British constitution is extremely complex. If we attempted to redesign it on a rational basis this House would certainly not exist. Whether or not the monarchy would exist is another question. We live with odd elements of tradition and history that are part of the rich tapestry of the country. These do evolve. I doubt whether very many children of newly appointed life Peers now accept or use the title of “Honourable”. We are moving slowly and we adapt as we go on.
Baroness Gardner of Parkes (Con)
My Lords, is the Minister aware, having read Debrett’s, that the way we are constantly referred to in the press as “Lady Sue” someone or “Lady Joan” someone is totally incorrect? The woman’s Christian name is always printed with “Baroness Something”, but this does not apply to the men. By doing that, the press is elevating us and making us the daughters of someone with a much higher, hereditary, title.
Lord Wallace of Saltaire
My Lords, I am much better informed on that issue than I was a week ago. Perhaps I may have forgotten in a week or two’s time.
Lord Dubs (Lab)
My Lords, would it not be better to get rid of titles altogether?
Lord Wallace of Saltaire
The noble Lord might well say that; I could not possibly comment.
Drug Companies: Medical Trials
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Kennedy of Southwark
To ask Her Majesty’s Government what action they intend to take in respect of drug companies that withhold the results of medical trials.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, companies are legally required through the marketing authorisation application process to provide the relevant regulatory authority with all information for evaluation of a medicine. This includes clinical trial results which are both favourable and unfavourable. The Medicines and Healthcare products Regulatory Agency has powers to take action where particulars supporting an application are incorrect or where the company has failed to inform authorities of new information that would influence the evaluation of the benefits and risks of the product.
Lord Kennedy of Southwark (Lab)
My Lords, the number 1 risk on the Government’s national risk assessment for civil emergencies, ahead of both coastal flooding and a major terrorist incident, is that of pandemic influenza. Is the noble Lord concerned that Tamiflu, which is supplied for use in a flu epidemic, may not be as effective as was once thought? Is he concerned that many large-scale trials of Tamiflu have not been publicly reported?
Earl Howe
My Lords, during the course of last year, the Government gave detailed evidence to the Science and Technology Committee on the issue of data provision in respect of clinical trials. The committee made a number of helpful recommendations on the removal of barriers to transparency. In our formal response, we set out how we would work to achieve the aims of greater transparency. In the light of that response, the Government are looking into the recommendations of the PAC report on the stockpiling of Tamiflu and access to clinical trials data, published in January. We will give our formal response to the report next month.
Baroness Brinton (LD)
My Lords, evidence shows that the chances of a complete trial being published are roughly 50%. The recent EU clinical trials draft directive will require all trials to be registered before they start, and full results to be published within a year. However, the regulation will be applicable only to trials starting from this year. How do the Government plan to ensure that pharmaceutical companies will release medical records for drugs that were launched before 2014?
Earl Howe
My noble friend raises a topical question. The industry’s trade body, the Association of the British Pharmaceutical Industry made clear, in its code of practice in 2012, that companies are obliged to publish all clinical trial results within a year of marketing authorisation and publicly register new clinical trials within 21 days of the first patient being enrolled. That, of course, is a forward-looking exhortation, but we are encouraged by the fact that the industry is taking an increasingly responsible view in this area by publishing data voluntarily, as demonstrated by companies such as GSK, AstraZeneca and Johnson & Johnson. We want to encourage more companies to do the same.
Lord Walton of Detchant (CB)
The noble Earl has made very clear the legal background to the present situation. He is fully aware that if a drug that has been fully tested and shown to be highly effective, and NICE has recommended that it should be prescribed to patients, the authorities have the legal responsibility to prescribe it. If, on the other hand, NICE has been given evidence to indicate that a particular remedy is ineffective as a result of negative clinical trials, is it equally incumbent on health authorities to recommend that that drug should not be prescribed?
Lord Mawhinney (Con)
I compliment my noble friend on the full and comprehensive Answer that he gave to the Question, and on the reassurance that it contained. Do he and his colleagues think that perhaps the issue here is not the legal framework but the issue of transparency and ease of access to information? If they think that that has some merit, would they be willing to consider having a simplified summary of the legal position on the department’s website for easy access for those who are interested?
Earl Howe
I absolutely agree with my noble friend. The Government are committed to transparency in the area of clinical trials. Transparency is important for patients, the public, researchers and the NHS, and it can be achieved through ensuring trial registration and outcome publication, as well as making data available through the appropriate channels. I think that the new EU regulation will be extremely helpful in promoting transparency, and the availability of summaries of all trials and clinical study reports will be a part of that regulation. However, I take my noble friend’s point about a simple guide for the public and I will gladly consider it.
Lord West of Spithead (Lab)
My Lords, will the Minister confirm that the work put in hand by the previous Government to ensure that we had the capacity to produce sufficient quantities of drugs to counteract various types of bird flu, once it had been identified, has now been completed and that we are in a position to be able to do that?
Lord Hunt of Kings Heath (Lab)
My Lords, I come back to the question raised by the noble Baroness, Lady Brinton. Once a medicine goes off patent it can, through generic production, remain available to members of the public for many years. The evidence seems to be that trials that give a favourable verdict are twice as likely to be published as trials giving unfavourable results. Could the noble Earl focus a little more on whether the industry can be encouraged to produce evidence around those trials in relation to current medicines as well as future ones? I also refer noble Lords to my health interest in the register.
Earl Howe
My Lords, it is important to point out that the MHRA does not have evidence that there is systematic or large-scale withholding of data. However, it has investigated cases in the past where clinical trials and safety data were not properly reported. The Government believe that the proposals included in the new EU clinical trials regulation will, as I said, contribute to greater transparency in the area of clinical trials. It must be remembered that any company infringing even the current rules can lay itself open to some very severe penalties.
Health: Folic Acid
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Rooker
To ask Her Majesty’s Government, further to the answers by Earl Howe on 18 December 2013 (HL Deb, col 1261) and 21 January (HL Deb, col 567), what was the population sample of females of child-bearing age used in the National Diet and Nutrition Survey for folate status; and on what dates the survey data were collected.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
Blood samples for folate-status analysis were collected from more than 600 females of childbearing age—15 to 49 years—as part of a UK representative sample of adults and children in the National Diet and Nutrition Survey. Blood samples were collected over four years from 2008-09 until 2011-12.
Lord Rooker (Lab)
My Lords, will the Minister accept that those figures are much smaller than recent research samples such as the 50,000 people involved in the Lancet-published research last year and the 500,000 women in England over a 12-year period in the research published last week that showed that the quantity of folic supplements taken by them was actually falling, which is the current policy? Given that the UK has the highest rate of neurological defects in the whole of Europe—80% of which pregnancies are terminated—is it not time to make a decision, talk to industry, the medics and science and join the other 70 countries protecting women from those births?
Earl Howe
My Lords, I recognise that this is an extremely important decision for the Government to make, affecting many people’s lives. I do not accept the implication behind the noble Lord’s question that the numbers involved in the analysis were somehow statistically invalid. I am assured that they represent a valid statistical base. We welcome all robust new evidence around the issue of fortification, such as the study published last week by the Wolfson Institute, and I can assure the noble Lord that we will take a decision on this matter as soon as possible.
Lord Hunt of Kings Heath (Lab)
My Lords, could the noble Earl give a little more precision as to what “as soon as possible” actually means? He referred to the study produced by the Wolfson Institute last week. Is he aware of the comments of Sir Nicholas Wald of the Wolfson Institute that it will be a public health tragedy if this country does not follow the example of the many other countries that have introduced this in a mandatory way? Is it not time that the Government simply made a decision? Indeed, they are clearly briefing to the media that they are going to make a positive decision. Why do not they just come clean and say, “We’re going to do it”, and say which date it will start from?
Earl Howe
My Lords, as I have explained on earlier occasions, it is very important that we use the latest data to reach a robust and defensible view of the risks and benefits on this issue. We will take the new National Diet and Nutrition Survey data on folate status into account when we do reach a decision. As for the position taken in other countries, while a number of countries have introduced mandatory fortification of flour with folic acid, others notably have decided against it, including Ireland and New Zealand.
Lord Patel (CB)
My Lords, the single most effective public health measure, which would prevent the birth of babies with severe spina bifida and lifelong disability, would be 400 micrograms daily of folic acid. Why would we not do that as a public health measure, when all the scientific evidence is already there?
Earl Howe
My Lords, in recommending the fortification of flour with folic acid, the Scientific Advisory Committee on Nutrition also advised that action should be taken to reduce levels of voluntary fortification, which, as the noble Lord knows, is applied to a number of breakfast cereals, for example. That is no easy matter. It would be necessary to avoid folate levels exceeding recommended limits and to put action in train to achieve that. There are other conditions and advice attached to the SACN recommendation; it is not quite as straightforward in practice as the noble Lord might suggest, although I recognise that the recommendation from SACN is there.
Baroness Gardner of Parkes (Con)
My Lords, I am very disappointed by these answers today. I thought that this matter was signed and sealed when we heard my noble friend’s answers some weeks ago. In reply to my question, he just said that I was a bit premature in asking whether it could be put in brown bread as well as white. Really, the facts have been established that in order to have an overdose you would have to eat two or more full loaves of bread, and I think that the danger of any pregnant woman doing that is pretty small.
Earl Howe
My Lords, my noble friend always raises some extremely valid points and, of course, I take them. However, I would just gently point out that SACN is concerned about overdosing, which is why it urged that action should be taken to reduce levels of voluntary fortification. Mandatory fortification of a staple food is, I would suggest, a serious matter for the nation, and these decisions have to be reached in a robust and responsible way.
Baroness Symons of Vernham Dean (Lab)
My Lords, can the Minister tell us who is actually doing the assessment on the data that are available so far? The noble Earl finds himself in a difficult position as we revisit this question almost on a monthly basis. A number of us are at a total loss to know why he cannot tell us when a decision will be taken. Will the assessment be made in his department and, if not, where is the assessment going to be made so that Ministers are given the knowledge and data to make a decision on this question, which is long overdue?
Earl Howe
My Lords, the Scientific Advisory Committee on Nutrition is the body charged by government to advise Ministers, and the decision will be taken by Ministers. But we have thought it prudent and sensible to take into account the latest data on the folate status of the population. The information that SACN drew from is more than a decade old, and we do not think that that is a sensible basis on which to take a decision one way or the other. So we must wait for that evaluation.
The Countess of Mar (CB)
My Lords, does the Minister agree that there is an equal conundrum with adding fluoride to water? Her Majesty’s Government seem to be quite happy that fluoride should be added to water, yet there is a possibility of overdose if people have fluoride tablets, fluoride toothpaste and all sorts of other things. What is the difference between that and folates?
Baroness Brinton (LD)
My Lords, given that there is a delay in the Government’s decision, what is being done to ensure that young women are informed about the importance of having some supplements? Waiting until they are pregnant is clearly too late.
Earl Howe
My Lords, government advice on taking supplements is available to women through a number of channels, including Healthy Start, NHS Choices, Start4Life, The Young Woman’s Guide to Pregnancy and the Information Service for Parents. To improve maternity services for women, NICE has published a comprehensive suite of evidence-based clinical guidelines in this area.
Health: Meningitis B Vaccine
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Turnberg
To ask Her Majesty’s Government whether they plan to introduce a vaccine for meningitis B in children.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, the Joint Committee on Vaccination and Immunisation, the independent expert committee that advises the Government on immunisation matters, has not yet made a final recommendation about the use of the meningococcal B vaccine, Bexsero. The JCVI is due to report in March 2014, having reviewed additional evidence at its meeting earlier this month. We will respond to any JCVI recommendation as quickly as possible.
Lord Turnberg (Lab)
My Lords, I am grateful to the Minister for that response. Meningococcus B causes a very nasty form of meningitis. It affects about 1,000 cases a year, mostly in children. It kills about one in 10 and causes severe and lasting disability in one in three. It is no wonder that it is a parent’s worst nightmare. Yet the safe and licensed vaccine that can prevent most cases was turned down by the JCVI after what seems to have been rather a doubtful cost-benefit analysis. Will the Minister make sure that when the JCVI comes to look at it again, as it is doing, it uses a more relevant discount value for the quantity and quality of a child’s life; and that once the Government have received the committee’s advice, they will make a rapid decision to make the vaccine available?
Earl Howe
I can give the noble Lord an assurance on the latter point. We will take a decision as rapidly as we can once we receive the JCVI advice. I appreciate that the JCVI’s interim position statement will have been disappointing to many people. I know the noble Lord recognises that it is important that decisions about the introduction of new vaccines into the national immunisation programme take account of evidence of their effectiveness, safety and cost-effectiveness compared to other healthcare interventions. We need to wait and see what the JCVI’s final advice is. I am aware that it is looking at the cost-effectiveness methodology that is used for vaccines of this type.
Lord Avebury (LD)
My Lords, do the options now being developed by Public Health England at the request of the Government include a population-based evaluation of the meningitis B vaccination, taking into account the discounted lifetime cost to the public sector of supporting children who are disabled by the disease? Will my noble friend also explain why the Department of Health assumed that the carriage effects achieved with meningitis C do not read across to this variant of the disease?
Earl Howe
I can tell my noble friend that the JCVI has been considering both those issues: first, the possible need for a population-based evaluation of the MenB vaccine to address uncertainties in its effectiveness; and, secondly, what the possible effect of the MenB vaccine on the carriage of meningitis B bacteria might be. I say again that we need to wait for the JCVI’s final statement of advice to get clarity on either of those issues.
Lord Hunt of Kings Heath (Lab)
My Lords, of course I understand that we need to await the outcome of the Joint Committee’s further deliberations. However, following up the Question asked by my noble friend, if the committee sticks to the view that a vaccine would have a huge impact on an estimated 1,000 young people every year but still considers that that is not cost-effective, surely it calls into question the methodology that it is using. Will the noble Earl say a little more about how the Government can ensure that this methodology is put under full scrutiny?
Earl Howe
Last October, in recognition of concerns about the methodology currently used for assessing cost-effectiveness of vaccines, the JCVI agreed that a working group should be formed to consider two issues: first, how the impact of vaccination programmes to prevent rare diseases of high severity should be best assessed; and, secondly, whether there were aspects of cost-effectiveness in relation specifically to children that should be addressed. It is a complex issue both economically and, indeed, ethically. We should not expect a report from that group, once it has been established, until next year at the earliest.
Lord Patel (CB)
My Lords, the vaccines that my friend, the noble Lord, Lord Turnberg—he is a friend, at least as regards medical matters—talked about are developed through a new kind of science, which does not involve the use of eggs or any other animal material, and therefore is not only more effective but produces fewer side-effects, particularly in children. The vaccine that we are talking about is for a particular type of meningitis. The new vaccine may not be considered as cost-effective as a conventional vaccine. However, if you take into account clinical side-effects, the new vaccine may be considered cost-effective, so a different kind of assessment must be carried out that is based not just on conventional cost-effectiveness.
Baroness Masham of Ilton (CB)
My Lords, how do we compare with other European countries in giving children this vaccine?
Earl Howe
Our childhood immunisation programme generally bears comparison with any country in the world and is very extensive and very successful. However, the incidence and prevalence of meningitis B is higher than in many other countries, which is why there is such concern about it.
The Earl of Listowel (CB)
My Lords, will the Minister assure the House that, if this vaccine is accepted, the infrastructure will be in place to enable it to be administered swiftly to as many children as possible? Are health professionals trained and ready to administer the vaccine, if it is decided to accept it?
Pensions Bill
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
16:21 - Division on Amendment 1 - Ayes: 215 / Noes: 210 - Amendment 1 agreed.
17:43 - Division on Amendment 2 - Ayes: 202 / Noes: 237 - Amendment 2 disagreed.
“( ) Regulations may provide for circumstances in which a person may opt to have a year treated as a qualifying year if by aggregating income from two or more jobs, that person’s earnings are equal to or greater than the lower earnings level for that year.”
Baroness Hollis of Heigham (Lab)
I am grateful for the tolerance of the House in allowing me to delay speaking for a moment or two while noble Lords are leaving the Chamber. They are clearly underwhelmed by the issue that we are about to debate.
I strongly welcome the new state pension. Pensions are attached to the waged labour market. Only one job in four created since 2008 is, according to the Work Foundation, permanent; 1 million or more are zero-hours contracts with no certainty of any work at all. Hundreds of thousands of others are short-hours contracts and, along with other non-standard employment patterns such as term-time working, job sharing and so on, comprise 40% of all jobs—I repeat, 40%—as employers seek to match a flexible and irregular labour force to flexible and irregular demand.
Part-time work and flexible work may suit, and does suit, many women, students or older people on a pension. Those jobs are in cleaning, catering, domiciliary care—involving 150,000 people—hotel and retail, and are usually paid at around minimum wage level. Very many of those people will not be building a state pension. Our pension structure, both state and private, has not yet caught up. It is 10 or 15 years behind as the plates shift in the labour market.
This amendment, which is permissive, seeks to put a pension floor under workers who may work in several mini-jobs and put in quite long hours—30 or so a week—but who cannot, under rules set out decades ago, build themselves a new state pension. If they are in one job with sufficient pay they will build a state pension, but if they are in several jobs with identical pay they do not. If your Lordships agree today we can begin to do something about it.
Under Governments of both parties we have sought to credit people into the national insurance system for a state pension where, for good reason, people are not in waged work. They include mothers of young children, disabled people and carers. Universal credit, which I strongly support, will credit another 0.8 million people into national insurance, I understand.
So where are we? From 2016 you will need 35 years’ worth of credits or payments into the national insurance system to get a full state pension. If you are unemployed and on JSA, and later on UC, you are credited in for free. If you have a child under 12, are a grandparent caring for a child whose mother works or are on disability benefits or carer’s allowance, you are rightly credited in for free. Your Lordships have over the years been at the forefront of pressing all Governments to bring such groups rightly into the national insurance system. If you earn above the lower earnings limit, or LEL, at £5,700 a year you come into the national insurance system for free. If you earn more than £7,500 in a single job you come into the NI system but pay. If, however, you work 30 hours a week and earn £11,000 a year but in several, splintered jobs, you cannot add the pay together to get above the LEL. Come retirement, you do not have a decent state pension.
Hence this amendment. It seeks an entirely permissive way in which to future-proof our state pension structure for those in the new flexible economy who work in and combine mini-jobs, by allowing them to combine the earnings from several jobs for a pension if that takes them over the LEL at £5,700. In the past, perhaps 50,000 people, mostly women, were affected, especially in rural areas, as they stitched together a patchwork of cleaning, fruit picking, bar work and so on, and they relied instead on their husband through the married women’s dependency pension. That pension, which would have protected her, is being abolished. She—or you, or we—is on her own and will not get any state pension from her patchwork of mini-jobs. From now on she gets nothing at all. The reason is that the labour market has changed dramatically in the past decade or so with the growth of zero-hours and short-hours contracts.
Short-hours contracts guarantee part-time work for three, 13 or maybe 23 hours. Zero-hours contracts, however, do not guarantee you any hours at all. You may in practice work 10, 15 or more hours fairly regularly. Equally you could find at the beginning of your shift, 10 minutes before you are due to start work, that there is no work for you: you get no pay and go home. I understand that every Domino’s Pizza worker is on a zero-hours contract—ZHCs—as are hundreds of thousands of staff in McDonald’s, Boots, Burger King, Subway, Wetherspoon and Sports Direct. They work in food joints, call centres, customer services and domiciliary care; they are cooks, cleaners, drivers and waiters; they are agency workers—almost all of whom are on zero-hours contracts. Most are on, or on around, minimum wage. Far from this being a shrinking sector of the market, the number of such contracts is increasing rapidly and very many of those workers will not be building a new state pension.
Baroness Drake (Lab)
My Lords, a sustainable welfare system needs to be affordable, but it also has to be inclusive and responsive to the realities of the contemporary labour market. For a long time, the national insurance and state pension system has been exclusive, indeed unfair, in its application to a particular group of workers, mainly women—a community which the department estimates to be about 50,000 and consisting of people who undertake mini-jobs. Each job delivers earnings below the lower earnings limit of £5,668, the access point for the national insurance and state pension system, but there is no provision for people with these mini-jobs to aggregate their earnings in a way that would allow them to enter the national insurance system. For example, a woman with two part-time jobs, earning £100 a week from each, will not accrue national insurance and pension rights unless she is covered by some alternative crediting arrangements. Someone earning £110 from one job would accrue. Yet £100 equals about 16 hours on the national minimum wage, so a person with more than one such mini-job could be working a significant number of hours.
Mini-jobs may be driven by caring responsibilities, work availability and, more recently, the increasingly common phenomenon of the zero-hours contract. Some of these women could gain state pension through their husband’s entitlement, but from 2016 they will not be able to build up an entitlement through their spouse because the new single-tier pension allows women to accrue pensions only in their own right. My noble friend Lady Hollis demonstrated the example of women in households who no longer have young children and whose spouse’s income floats them off universal credit being locked out of the pension system. The Bill makes the default position of entitlement through their spouse for many women disappear, which gives the problem fresh urgency.
My noble friend Lady Hollis has long campaigned to have this unfairness addressed and lists the rebuttals she has faced over the years: that it is not reasonable to try to share employers’ national insurance across mini-jobs; that the women will not want to pay class 1 contributions; that there are not very many of them; that their situation is temporary; that they have time to make up missing years; and, if all else fails, that there is pensions credit.
However, the urgency and the scale of the problem have increased exponentially since my noble friend started her campaign and those rebuttals are no longer valid. A much larger number of people with mini-jobs are affected as a result of the growing use of zero and short-hours contracts, where workers have little or no control over the hours they may be offered in any one week. The Office for National Statistics estimates that 250,000 people worked on zero-hours contracts between October and December 2012. However, its survey relied on people understanding that they were on zero-hours contracts, and the ONS has conceded that that may well have resulted in the true figure being substantially understated and that it may be much higher. The ONS is now running a survey to,
“obtain robust data directly from employers”.
As my noble friend said, the Chartered Institute of Personnel and Development suggested that up to 1 million people—around 3% to 4% of workers in the UK—are on zero-hours contracts.
The zero-hour mini-job problem is now systemic in nature. According to the Government’s workplace employment relations survey, in 2011 23% of workplaces with 100 or more employees used zero-hours contracts. Surveys reveal sector concentrations too: 61% of domiciliary care workers in England were employed on zero-hours contracts; and Unite and others report a high incidence in low-paying sectors such as the docks, retail, catering and social care, and they are not restricted by age. These workers face weekly insecurity in hours and pay and many are not building up entitlement to national insurance benefits. The DWP and the Government will have to address a problem that now has scale, is systemic and does not interface with the national insurance system.
When launching his consultation on zero-hours contracts, the Secretary of State, Vince Cable, said:
“It is clear that they are much more widely used than we had previously thought”,
and further that:
“Our aim through this consultation is to find which options best prevent any abuse of zero hours contracts while maximising the opportunity and flexibility such contracts can present”.
This suggests he believes these contracts will be a widespread and sustained phenomenon. The noble Lord, Lord Freud, in his normal straightforward manner in Committee when responding to my noble friend Lord Browne, recognised the growing evidence of zero-hours contracts. He said that,
“the Government have estimated their costings and needs, on the basis that it is a tiny minority”,
and that this basis,
“will be undermined. He certainly makes me even more uneasy about the neglect of this group than I was before we discussed the issue today”.—[Official Report, 18/12/13; col. GC 332.]
Lord Morris of Handsworth (Lab)
My Lords, in supporting this amendment I am pleased to follow my noble friend Lady Hollis. I know that she has marshalled the arguments and found the evidence, which she has advanced with authority and passion. Nevertheless, in this debate I seek to reinforce two points that I feel strongly about. First, all the evidence tells us that many people will be adversely affected by not having national insurance credits, not only while they are in work but, most importantly for this Bill, when they move into retirement. Secondly, for too long we have known that this situation is occurring, but we have made the excuse that not many people are in mini-jobs. That argument no longer holds good. We are told that they are here today and gone tomorrow, so we have avoided tackling the problem.
We must remind ourselves that the economy is changing. It is more demanding and is now a truly 24/7 economy which has to be serviced, so those who are affected by the Government’s lack of effort to find a solution to the problem are hard-working people who deserve not just our praise, but our recognition that they, too, should enjoy the same rights and security as others. The answer we have received so far is that they are only part-timers, although it is recognised that many are earning less than the lower earnings limit. The evidence tell us that many are on low pay and that people have not just one mini-job, but two or even three of them under so-called variable contracts spread over five, six or seven days a week. More than that, although they are in work, they are insecure and many have no knowledge of what they will be expected to do next week or the week after. They suffer the inconvenience of not being able to plan their lives and look after their families. People in mini-jobs are doing what the Government have asked us all to do—to be flexible—but of course flexibility in this instance does not provide the security of universal credit or jobseeker’s arrangements. In fact, these people are being penalised for doing exactly what is required to maintain a stable and robust economy. In reality, this group of people should enjoy a system of deferred credits as they are making themselves ready for work for when the economy gathers momentum, as we all know it will.
I said earlier that we have not tackled this problem because we believe that not many workers are involved, but the numbers have been played down. The DWP states that 50,000 people are affected, and this figure has been widely cited by Ministers in both Houses. However, as my noble friend Lady Hollis set out so clearly in her evidence, that figure of 50,000 is a gross underestimate of the number of people in so-called mini-jobs. I suggest that anyone who doubts the number of people involved visits the interchange at Bank DLR at around 5 pm on any working day. Thousands of financial sector workers flow off the DLR only to be replaced by thousands of cleaners and maintenance workers flowing back to service the offices of Canary Wharf and elsewhere in east London. However, that is not the end of their day. Many return later at night to clean hotels and shops. This can be seen wherever there are offices, factories, shops and restaurants in the towns or cities of the United Kingdom. It is a universal pattern of work that has evolved in the past half decade.
I understand that it has been said that providing fairness to people in mini-jobs will add to the work and put considerable stress on employers, and that the computerised systems of government departments cannot cope with the strain. The technological strain is nothing compared with the mental strain and insecurity of the people who are trapped in these so-called mini-jobs. The DWP and HMRC can resolve this problem. All that is needed is some joined-up thinking. They can resolve it, because we are talking about the lives of thousands of people and about fairness. If they are not provided for today while at work, society will have the responsibility and duty to provide for them in retirement.
In seeking to tackle in-work poverty, the Government are rightly proud of raising the tax threshold incrementally to those earning £10,000. However, what is the point of seeking to tackle the scourge of in-work poverty through the tax threshold system by creating poverty in old age through the Pensions Bill? There is not much point at all. In the past, Ministers have argued that this problem of crediting people with multi-jobs may place a burden on employers. The price of not placing a burden on employers is the price of placing a burden on the whole of society in the years ahead, as some of these workers become pensioners. With part-time working and zero-hour contracts on the increase, this is a reasonable expectation for any civilised society to place on them.
In the lexicon of today’s employment pattern, we hear the language of “mobility”, “flexibility” and “creativity”, but for the economy to thrive and deliver its full potential, management too must break out of its silo mentality and be creative and flexible in its ideas, as it seeks to determine how a reward package can and should be made, to ensure that we provide not just for today’s but for tomorrow’s pensioners. At the very heart of this must be the transferability of national insurance credit. It is simple. All we need are the two major departments of state to sit down, have a conversation and, of course, seek knowledge based on the experience of the people who are at the receiving end of these mini-jobs.
I strongly believe that we should make policy on what is right and fair for the workers affected. By any logic, the Minister must admit that it cannot be right that someone can be unemployed and get a credit, but get nothing for having some type of work—so-called mini-jobs. These workers do not seek favours. On their behalf, I hope that this House will give them fairness.
Lord German (LD)
My Lords, the issues raised by this amendment are important, and I congratulate the noble Baroness, Lady Hollis, on her dedication to the issue over many years. She kindly told us in Committee how she was rebuffed by her own Government and today she repeated the argument that they used against her: one could not reasonably divvy up an employer’s national insurance—she used those words today again—if there were two or more such jobs. She further told us that women would not want to pay class 1 contributions. For that reason, this is an important issue. We are looking at people being able to contribute to their own pension and get the credits that they need to win a full pension in under 35 years.
Much of the discussion that noble Lords have heard today and in Committee has been about the way that people behave individually in response to the issues in front of them and about how people’s live are dealt with. The problem that we face is that there are no reliable statistics or evidence that show how individuals’ behaviour works. It is clearly possible—I heard it both in Committee and here today—to illustrate that in a way that works to the best of the argument that says that we need to move on this swiftly because there are so many people involved in a particular category. I do not mind people making contributions about the way people behave, will want to behave or are forced to behave, but I want to know how we can sort this problem out and do so in a realistic way that will result in a concrete outcome.
We are bound to hear more and more about zero-hours contracts. They are not a new phenomenon. Over the past 70 years, the notion of a job for life has all but disappeared. More and more people are spending time in self-employment, many people have more than one job and more people have part-time jobs. The single-tier pension itself is designed in such a way that an individual with a more varied work history will be able to build up their national insurance records to achieve the maximum state pension outcome, provided of course they get credited for their national insurance contributions.
The crucial issue, therefore, is whether universal credit will pick up and deal with this issue. I suspect that the answer given to the noble Baroness, Lady Hollis, when she raised this issue with her own Government, was that this is a very typically difficult issue for HMRC, given the range of information that it would require from every company in the land about who they employed and that it would have to combine the results and put them into a single file. That is of course precisely the process that is taking place, and will take place, through universal credit, which will pick up levels of flexible income including, by implication, that relating to zero-hours contracts. It is interesting that the lower earnings level, below which you do not have to pay or get credit for national insurance contributions, is £5,772 per annum at present. The Labour Force Survey figures show that those on zero-hours contracts work, on average, 20 hours a week at £9 an hour, which is enough to exceed the lower earnings limit. If the figures we have before us are to be believed, most people will be receiving enough income to receive the national insurance contribution.
The other issue about universal credit is that it will look very carefully at how it credits people and bring, as we have heard, another 800,000 people into the crediting system. For example, a single person without savings, earning below that £5,772 per annum level, will be eligible for universal credit and thereby eligible for the national insurance contribution. The question that I have to ask my noble friend is about the delivery of universal credit. In Committee, the Minister said it would be delivered in 2016-17 and the noble Baroness, Lady Hollis, said in 2019-20, although she hoped it might be earlier than that. I apologise if it was somebody else on her Benches but those are the sorts of span. If we believe my noble friend, and it is 2016-17, will this problem be dealt with from the outset by those who are then brought into the universal credit system? If that is the timetable, I ask noble Lords to consider how long it would take to put in the interim solution. In effect, what is being asked for is an interim solution between now and when universal credit comes in for a pensions system that comes into play in 2016.
What is the interim position? Do we need to ask HMRC to invent a system for itself? When the noble Baroness, Lady Hollis, asked the Labour Government for one in their time, they rejected it. I believe they said that it would be cumbersome and expensive. Do we need to have that in place or could we be reassured that, almost within the very short period of the implementation of the single-tier pension, universal credit will be in place in a sufficient and timely position so that the vast majority of people who are occupying two or more jobs that produce an income over a year of less than £5,772 at the current rates will be able to be credited? That is the key question.
Lord Forsyth of Drumlean (Con)
I did not participate in Committee but I am listening to my noble friend’s carefully constructed argument. Is not the point about this amendment that it is permissive? It simply provides the Government with an alternative; it does not oblige them to do anything. I cannot really understand why my noble friend is opposing the amendment while advancing that argument.
Lord German
It is because we have a response in place, which is the universal credit system. What matters more than anything is that the system is in place in time to capture the people who will be most affected by this in the implementation years, from 2016 onwards. That is the fundamental question and I await the answer in my noble friend’s response.
Lord Browne of Ladyton (Lab)
My Lords, I support my noble friend’s amendment—and, having listened to the contribution of the noble Lord, Lord German, I am delighted that I do not have to answer the questions that he posed. I suspect that the noble Lord who is the Minister for Welfare Reform had wanted to avoid having to give a date as to when the universal credit system will be functioning well enough to provide the sort of functionality that the noble Lord, Lord German, seems to think that the alternative to this amendment requires. I will listen carefully to the Minister’s response and write down any date that he gives us in relation to that. It is also a pleasure to follow my noble friend Lord Morris, who speaks with significant experience of, and great authority about, the workings of the modern labour market, and who has assisted us greatly in understanding the need for this amendment.
As my noble friend said, this issue was debated in the Commons and in Committee at some length. I have considered carefully the various government responses, as my noble friends Lady Hollis and Lady Drake clearly have. They are to be congratulated for having produced here what could be described as an elegant, permissive, statutory device that adds to the Minister’s armoury in his desire,
“to seize this issue head-on”.—[Official Report, 18/12/13; col. GC 328.]
He used that phrase in our debate when he expressed equal concern—the words are mine—as the rest of us about this issue. I believed, as did all those who were present debating the issue, that he shared our concerns. Indeed, in his contribution to the debate he indicated why he had come to that conclusion.
In support of the arguments that I set out in my own contribution in Grand Committee, I simply want to make three points today. First, the phenomenon of people working in two or more low-earning jobs is not a limited one. They are often on zero-hours contracts but certainly on short hours, with each job under the level at which national insurance contributions are made, and are therefore not building up a contributions record towards the state pension. Nor indeed is it a temporary phenomenon, as has been argued, often coming at the end of a working life. Nor is it an experience limited to rural communities, although it is very prevalent there.
Since I shared the content of my overheard conversation on the Transport for London overground train, I have consciously inquired of young people whom I meet in this city and back home in Scotland how many of them are working for more than one employer. For noble Lords who have not heard this short anecdote, I will repeat it. A few days before we debated this matter in Committee, I overheard a conversation among three young people on an overground train as I was making my way home from your Lordships’ House. It was very clear to me that they had all been working together in what I suppose we would call a mini-job and that they each had two other jobs.
What was significant about them was that two were graduates and the third certainly had a tertiary level of education. I found that surprising. I do not know why I found it surprising, but it caused me to inquire the same of other young people, and I have come to the view that this is the norm for thousands of young people in the first phase of their employed life, even for graduates. It is a significant feature of a flexible labour market and, along with zero-hours contracts, it is part of the reason that politicians, particularly Ministers, and employers celebrate its flexibility. Undoubtedly the number of people in this situation is growing, not declining.
The question of numbers leads me to repeat a point I made in Grand Committee, which has already been made by my noble friends. The Government assert that there are about 50,000 people in this category. I am not convinced by their estimate of the scale of the problem. That is based not on my experience but on evidence that has already been referred to. We await the outcome of the—I think still anticipated—BIS consultation on zero-hours contracts, which was promised in October and is due to report by the end of March, but I have not seen a lot of evidence of it. We should reflect on the fact that in the fourth quarter of 2012, the ONS estimated that there were 250,000 people on zero-hours contracts. However, a contemporaneous survey of employers by the CIPD estimated that in fact the figure was around 1 million.
As we have heard, the union Unite estimates that as many as 5.5 million people are employed on such contracts up and down the UK. Following the CIPD estimate, the ONS conceded that the Labour Force Survey, which is based on responses by individuals, more than likely understated the numbers. The ONS then announced, as my noble friends have told your Lordships’ House, that it would change the way it collected its data from autumn 2013,
“so as to obtain more robust data”.
The importance of this contradictory information is not that it goes directly to the heart of the estimate from the Government, but that clearly it must have informed the Government’s estimate. None of the estimates that the Government have for the scale of this problem is at all reliable. Therefore, your Lordships cannot be convinced that a strategy based on unreliable statistics is a reliable strategy.
Finally, the Government’s responses appear complacent. Steve Webb, the Pensions Minister, suggested in the Commons that there was only a tenuous link between having multiple jobs below the LEL and being unable to build up the required 35 years’ contributions, and referred to this problem as a temporary phenomenon. In our debates in Grand Committee, the Minister promised that universal credit would resolve the issue. The noble Lord, Lord German, has already gone through the pros and cons of that in some detail, and my noble friend Lady Hollis significantly undermined that argument by pointing out the categories of people who are in these jobs who would be denied universal credit in the first place and therefore the consequent crediting of national insurance contributions.
I say with respect to the noble Lord, Lord German, that that is the one point of our argument that he did not engage with. Even if universal credit is the answer for some of those people, it cannot be the answer for all people in this category, and in the absence of reliable statistics, it is not easy to see what proportion of people would benefit from a universal credit system that met the coincidence of engagement with the challenge that the noble Lord, Lord German, set out.
What do we need? We need an alternative. We can have no confidence that the approach of either the Pensions Minister or the noble Lord, Lord Freud, will be sufficient. If it is not, the net effect will not only be to deny access to the modern pension system to a significant number of people, most of whom will be the least well paid working people in our society. As the numbers grow—and they will—it will also, in the long term, severely undermine the pensions policy that is now agreed across your Lordships’ House, because it will increase the number of people who have to depend on means testing in retirement.
We support the amendment tabled by my noble friend. We want to make it clear that this is a solution for now, in the context of the Bill. We hope the amendment will be agreed and will become law. It will then be for the Government to take it away and for the Minister to seize the opportunity to use it to address the issue head-on.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, I thank the noble Baroness, Lady Hollis, for the amendment which gives an opportunity to debate again a most important issue which is close to her heart and with which I am sympathetic. Over the years we have had quite a few discussions on how the issue is best addressed.
Single-tier reforms strengthen the contributory principle and reduce disparities in outcomes between individuals. They are designed to fit with the working lives of today’s young people, who should find it much easier to plan for the future, counting on a full single-tier pension. At first glance, it may appear that the national insurance treatment of those in low-paying mini-jobs is at odds with these principles. However, I would like to explain why we think mini-jobs are not the problem they might seem to be and why, looking at how to adjust the national insurance system to combat this perceived problem, we may end up with solutions which create more problems and knock-on impacts than they solve.
The noble Baroness has been as assiduous as always in exploring all the sources to illustrate her case for change. Her central estimate was that 250,000 people would be affected. I continue to be confident in the department’s estimate of the number who—if we were to aggregate their earnings in the way proposed—would gain that extra qualifying year. That number is some 50,000 at any one time, which is fewer than one in 500 workers. This number makes perfect sense when you look at the opportunities the national insurance system provides for gaining state pension qualifying years. The entry point for workers is through the lower earnings limit, which is set at £109 a week. This is £40 below the primary threshold which is when national insurance starts to be paid. At the national minimum wage, this is just 18 hours a week for a year or six months of full-time work. There is also a comprehensive crediting system that recognises caring responsibilities and those unable to work.
The 50,000 figure is a snapshot from 2012-13 and individuals may gain a qualifying year in other years. In the single-tier system, full pension entitlement is achieved after someone has built up 35 qualifying years. People can therefore spend a third of their working lives outside the national insurance system and still gain the full single-tier amount. This was a deliberate part of our design, to recognise that people have increasingly varied careers and working lives, and yet can still reasonably count on a full single-tier pension in their retirement planning.
My noble friend Lord German inquired about the timetable for the introduction of universal credit. We are planning to pull that in for the bulk of people, virtually everyone, in 2016 and 2017. That would certainly include everyone in the workforce. The numbers beyond that are some of the people who are currently on ESA on a long-term basis in the support section.
If we were to take a similar snapshot to that of the 50,000 in 2012-13 but in 2017, we would find that individuals with the same characteristics may well be getting a credit through universal credit. This will bring at least a further 800,000 people into national insurance credits. For instance, the partner of the claimant or those on very low earnings—below the lower earnings limit—will be brought into universal credit because the Government believe that it should pay to work.
We have had a parallel discussion on zero hours, which has clearly been a source of concern around the Chamber today. There is concern at one level from the employment practices perspective. As noble Lords are fully aware, BIS is consulting on this issue. There is also a degree of uncertainty around the prevalence of this practice and whether it is increasing; as noble Lords have pointed out, the ONS is looking closely at evidence for this. However, we know that the proportion of women with two or more jobs is similar to the proportion of 10 years ago; in other words, around 5% of all workers. We are not talking about using the word “exponential”, which I have heard around the Chamber once or twice this afternoon. The number of women in full-time work rose in the past year by more than 270,000, and the number of women in two jobs actually decreased in that year by 25,000.
Clearly, when we look at zero-hours contracts, I need to make the point to the noble Baroness, Lady Drake, that I did not indicate in Committee, nor have I indicated, that the number of individuals on those contracts was small or in some way insignificant. However, the question at hand here is about access to the national insurance system and there is no evidence to suggest that being on this type of contract presents barriers to entering the national insurance system because of low pay.
Figures from the Labour Force Survey and the Chartered Institute of Personnel and Development—the CIPD—both show that those on zero-hour contracts work an average of around 20 hours a week, as my noble friend Lord German pointed out. This is enough to exceed the lower earnings limit even on the national minimum wage of £6.31 an hour. Data from the ONS suggest that the average wage for those on a zero-hours contract is nearer £200 a week. In response to the point of the noble Lord, Lord Morris, the Labour Market Statistics show that full-time employment in the year is up 408,000, and part-time employment has gone down by 12,000.
I understand that the amendment is permissive, and even without any evidence of a significant problem one might think it would be helpful to increase the Government’s options in this respect. However, it is simply not necessary, given the extensive regulation-making powers already available, to modify the crediting system. In response to my noble friend Lord Forsyth, it is hardly useful to have redundant legislation on the books.
This amendment would allow people to opt in to have their earnings aggregated. It is not clear that this can be achieved without requiring a very high evidence base. For instance, if we introduced a system where people could effectively send in the employee’s rate of national insurance, we introduce incentives for employers to play the system. Some will contrive to avoid employers’ national insurance but without disturbing their employees’ national insurance position. The noble Baroness, Lady Hollis, suggested that the employer need not pay national insurance. However, even if that were the case there is still a significant burden on the employer. We also could not verify the wages without disproportionate cost. This would incentivise people to underreport earnings to get into the system on the cheap.
Aggregating earnings would have significant consequences for employers, including those people who would not now consider themselves to be employers. Take, for instance, the position of a woman whose job it is to clean private houses for a few hours each day of the week. The nature of the work would mean that she is likely to be employed and could have a number of jobs with different households. Under aggregation, each of those households would need to operate a Pay As You Earn scheme. They would need to contact HMRC to open such a scheme. They would then need to obtain and familiarise themselves with payroll software and use it to report earnings under real-time information to HMRC every time they pay their cleaner.
In response to the question from the noble Lord, Lord Morris, on joined-up thinking between the DWP and HMRC, I am pleased to say that we are actually working—I suspect for the first time—in a very joined-up way to get the RTI system to work. However, we do not want to require employers who would otherwise not have to have a PAYE scheme to open one up on an ad hoc basis. The point discussed by the noble Baroness, Lady Hollis, which would allow people to class themselves as self-employed, seems slightly odd given the concern about job security that motivates the debate we have just had over zero-hours contracts. Blurring the line between employment and self-employment is a minefield from a tax policy perspective. It introduces incentives to create more mini-jobs and to play the system.
The processes required to capture and collate earnings from people in mini-jobs cannot be achieved by simply tweaking the system. Moving to the aggregation of earnings from mini-jobs can only sensibly be considered under the work on the operational integration of income tax and national insurance contributions announced at Budget 2011 by the Chancellor. As noble Lords will be aware, national insurance liability is calculated on a per job basis but income tax liability is aggregated across all sources of earnings so the issues are similar. The Government concluded that given the scale of the change that operational integration would entail and the amount of change that employers are already managing, including the introduction of real-time information, they would await further progress on these before moving forward on tax/national insurance integration.
In the short term, we are not complacent and are determined that people who do the right thing and work are treated fairly. Beyond a radical overhaul of state pensions in this part of the Bill, specifically to make it fit for today’s workers, I have described work that this Government have undertaken to expand crediting coverage for low earners through universal credit and improving monitoring of zero-hours contracts.
This amendment may be intended to place a marker to nudge the Government into taking action, but it comes without strong evidence of a problem and the type of action that it promotes is piecemeal tinkering, which could create perverse outcomes and new unfairnesses, especially in the tax and national insurance system. I hope that the noble Baroness will withdraw her amendment.
Baroness Hollis of Heigham
My Lords, first, I thank very much my noble friends Lady Drake and Lord Morris for their powerful and moving speeches. I thought that their contributions were extraordinarily impressive, and I am sure that they moved many people in this House.
I shall address first the comments of the noble Lord, Lord German, many of whose points were dealt with very effectively by my noble friend Lord Browne from the Front Bench. Basically, he ran two arguments. First, he said that most of the people concerned would be on UC, and he pressed the Minister instead on UC. Secondly, he commented on the problems for HMRC in combining possible jobs. On the first argument, on UC—and I am very much in favour of universal credit—we agree the statistics are that another 800,000 should come into the NI system as a result of crediting arrangements. That is great, but the point is that UC is income-based and that income is surprisingly low. No one has mentioned that today. For example, if you are a single person and you earn more than £4,000 a year in any job, well below the lower earnings limit, you are above the level for universal credit so you do not get credited in. If you are a married woman, your husband is in work and you have two children—I am aiming for a generic family, if you like—and if he is earning more than £12,000 a year, that family is not entitled to UC, apart from housing benefit. She may be earning £4,000 or £5,000, but that will not give her a credit through him. Those two groups of single people and married women, which my noble friend identified and I seek to identify, are both outside the reach of UC. What is worse—and neither the Minister nor the noble Lord, Lord German, mentioned this—is that it is happening at the same time as we are withdrawing the married woman’s dependency pension of 60% that she would have had as an alternative and could have relied on. That is what is new. If she cannot get into the pensions system through universal credit, she cannot get in at all, and that has been created and constructed by this Bill.
The noble Lord, Lord Freud, said that he was confident of his figures of 50,000 people, but he was equally confident about two years ago when we were debating welfare reform and the figures then were 20,000 or 25,000. They have doubled exponentially in the past two years or so, and they may go on to grow equally geometrically, as opposed to arithmetically, over the next few years. He says that his statistics are broadly in line, but I do not know about that. His statistics are based on labour force statistics offered by the ONS, which the ONS now says are unreliable; that therefore means that his statisticss are unreliable. My statistics of 250,000 are the best that I can do with all the evidence there is, overlaying different subsets. I accept that, but I am as confident as I can be on the evidence that exists that at least 250,000 people and maybe more—it is an increasing problem—are outside the national insurance system and will not be credited in either through UC or any caring responsibilities.
The noble Lord quoted average income. An average income is pulled upwards by the proportion of people who work in IT, for example, which is highly paid, or in further education, where they are paid piecemeal. The Chartered Institute of Personnel and Development—which the Minister quoted several times, although he did not quote this—says that 40% of the 1 million people who are employed work below 16 hours per week. We know that the majority of those are on, or on around, the minimum wage: for example, in jobs in domiciliary care, hotels, waiting, driving or security. A mean average is no use in this, because the figures are skewed hugely upwards by people in IT, who may be very well paid—perhaps at £50 per hour—and come within zero-hour contracts. We need to see how many people are below the LEL in one job and work in a second job that is also below the LEL, which together would bring them into the NI system from which they are currently excluded. I repeat: that figure is likely to be 250,000—nearly every single person and most married women.
The Minister says that it would produce all sorts of perversities and paradoxes. There is no greater perversity than the situation in which, if you are unemployed and on JSA, you are credited in for free national insurance, but if you work 30 hours a week in two 15-hour jobs, earn £11,000 and pay tax, you cannot get into the NI system and get no state pension. Which of those is the perversity? Do not work and you are in for free; or work as best you can, by putting jobs together, and you are outside the system. Is that right or decent? It is not. I would like to test the opinion of the House.
“( ) A person is not entitled to bereavement support payment and is exempt from work conditionality as specified in section 30(1A), if he or she has reached pensionable age.”
Baroness Hollis of Heigham
My Lords, I should like first to say a word about procedure. I am glad to see the noble Baroness, Lady Anelay, in her place; that is helpful. This is a paving amendment that the Public Bill Office assures me is appropriate. Amendment 21 in this group—and only Amendment 21—is consequential on Amendment 2. Therefore, any vote on the first amendment is, in the words of the Companion, also a vote on its directly consequential amendment—although it does not, of course, determine any other amendments in the group. If it were not directly consequential there would be no point in a paving amendment. As I have carefully taken the clerk’s advice on this, I hope that the Minister and the House will agree with my statements. If the Minister does not agree that Amendment 21 is consequential, perhaps he could indicate so now because I would not wish to waste the House’s time.
Baroness Hollis of Heigham
I am grateful to the noble Lord, as this allows us to have a substantive discussion on bereavement—which I know concerns many of your Lordships—in good time and not in the late hours this evening. I know that the Minister is sympathetic to the situation of distressed children and widowed parents. I hope that I can refer generally to widows, as there are three times as many women who are bereaved with children as men—and I know that the Minister means well by them. I hope that the House will agree that this is neither a party matter nor, as it is permissive, a cost matter, as the cost is almost too low to estimate.
This is a modest amendment that seeks to help widowed persons avoid additional pressure in the most stressful and distressing period of their lives. Three-fifths of bereaved parents are in work at the time of bereavement—virtually all fathers and around half or so of mothers. Most fathers with a terminally ill wife continue, or continued, to work. Most mothers, however, give up their jobs to care for their husband. Fathers would normally go back to work after a couple of weeks; indeed, they are often anxious to do so. Some mothers may feel able to do so as well, depending on the age of their children and the nature of their job. However, many widowed mothers were not in work, because they had younger children, or they had stopped working to become carers and—this is key—many mothers who were in work when their husband died drop out of work for some time while they support their children. If they return to work later, it may be to a different job, to one that is part-time or less demanding. Whereas work seems to be essential and continuous for fathers, it becomes secondary and broken for bereaved mothers.
The Government are reconstructing bereavement benefits, with more money paid as an up-front lump sum and less as a monthly payment—which, at £400 a month, will be paid only for 12 months and topped up by universal credit while the claimant is out of work. After 12 months, bereavement support payments stop and, if the parent does not return to work, she may draw her full income from UC. Being on UC normally entails work conditionality—entering or re-entering the labour market. The Minister has agreed—for which I am delighted—that for kinship carers, work conditionality associated with claiming UC should not apply for 12 months after they have taken on the care of children. But—and this is the point of my amendment—work conditionality for widowed parents, unlike for kinship carers, will kick in after six months, not 12 months, while they are still on bereavement benefit. That benefit runs for 12 months precisely because the Minister, in all decency—and I respect him for it—recognises that they need that support for 12 months. Surely work conditionality should be aligned with those 12 months.
The Minister said in Committee that he thought that six months’ relief from work conditionality while on bereavement allowance, if the claimant receives some UC top-up, was “generous”. I confess that that shocked me. It is generous only by comparison with the situation of someone who is not a bereaved spouse, and I think that that is not a proper comparison. If the mother has returned to work, or wants help to do so earlier than that—and some will—that is fine, but I do not think it right and decent to require her to attend work interviews and full work conditionality and job-hunting after six months, when she has grieving children who need her more than ever.
In Committee, the Minister justified this by saying that work conditionality after six months,
“is necessary to help them adjust and regain control of their lives”.—[Official Report, 15/1/14; col. GC 146.]
I was shocked by that as well. From my experience, the exact opposite is true. If work conditionality kicks in at six months while the woman is still on bereavement benefits and she is not ready for it, she loses what little control she has in handling her family life. Instead, that power is transferred to the DWP—perhaps to a 23 year-old young man in a local benefit office who, I expect, will be well intentioned until the pressure of targets bears down on him. He is probably a young man without children and without any experience of bereavement. It is assumed that he knows better than she does what is best for her and her children in their grief. I hope that he asks his own mother for advice, because he probably will not have a clue.
I do not think that that is acceptable. We are turning this young man at the age of 23 into her parent and treating her as the child, denying her, as a parent, the ability to look after her children in the way she believes is best. This is a sort of cruel-to-be-kind, tough-love philosophy towards a grieving widow and severely distressed children. Tough love is perhaps fine for youngsters who are on JSA and do not want to get up in the morning, but we are bullying into seeking work a widow with children who is still numb with grief and hugely distressed. We really cannot have that.
In this paving amendment and the consequential amendment attached to it I am not arguing that a widow’s benefit should be increased, although personally I would support that. The amendment is not about more money; it is about allowing widows to decide what is best for them and their family in the immediate aftermath of bereavement. For me, the immediate aftermath is the first year during which all the anniversaries occur—Christmas, his birthday and the anniversary of his death. I know, as do many of your Lordships, that that first year is the hardest.
I ask your Lordships to put themselves in the widow’s place. Her husband’s death may have been sudden, due to an accident at work or in the car, and she is still traumatised by the shock, or he may have died after an illness such as a stroke or cancer and she is exhausted through caring for him. She is wiped out and her mental and physical health is pretty fragile. It is just at this time when, although she is exhausted herself, her children are distraught and most need her. Children I know who have experienced the death of a parent have regressed into bed-wetting, nightmares, broken sleep and school phobia. They have lots of mysterious tummy aches and frequent headaches, and they display challenging and clearly needy behaviour. Irrationally, they suffer anguish that in some way they were responsible for their father’s death. They feel guilty that they had never told the lost parent how much they loved him and are fearful that they may lose their mother as well.
Older children worry about their mother’s safety if she is late back, or they fear they may lose their home. They are profoundly upset a second time over at their mother’s grief. Stoically they try not to weep, as that makes it harder for her to cope. “He is not here to hug me”, said one young girl. They dream of him and experience severe depression. Children need their surviving parent to be physically available for them. They need the trust that exists between a child and his mother to discuss their father’s death. Emotional availability follows from that. In Committee, the noble Lord, Lord German, quoted very movingly from research into the effect of bereavement on children’s later lives, from delinquency to poor mental health and suicide risk, and the noble Baroness, Lady Finlay, mentioned cases of multiple deaths.
Every family is different, as is the work status of any bereaved parent, but this amendment, at no cost, permits the bereaved parent to decide what is appropriate for her and her family. We know that currently, bereaved parents do not take all the time off that they could from work. They do not exploit the system; they do not abuse it; they do not milk it. They want to work when they feel fit enough and their children are steady enough, but only they know that, not the DWP or the local benefit office. That is the point of having 12 months of bereavement payments. Insisting on work interviews and work conditionality at six months, or even leaving it to the discretion of 23 year-olds in local offices, adds stress to the suffering of the parent and distress to the pain of the child. We really should not do that.
The amendment would give widowed parents a breathing space from work conditionality alongside a bereavement payment while they rebuild their fractured lives. This House has always looked out for widows and children and I hope that it will do so again today. I beg to move.
Lord Freud
My Lords, the House may find it helpful to know that, although I do not agree that a change to conditionality in respect of only this specific group of amendments is appropriate, I am proposing to conduct a wider review into the circumstances where children could be in considerable distress and where it is clear that conditionality should not be applied. I am not attempting to curtail debate but it may be of advantage to the House to have that information in order that we may have a more informed debate on this group of amendments.
Baroness Finlay of Llandaff (CB)
My Lords, I have Amendments 18, 19 and 20 in this group. I am grateful to the Minister for informing us of his proposal to hold a review of the level at which conditionality is set in relation to considerable distress in bereaved children. I appreciate his concern and the time that he has spent with me and others in looking at the problems of bereaved children.
However, I must point out that bereaved children express emotions differently from adults. Indeed, the most distressed children often appear almost blunted to the death of the parent and are simply quiet, withdrawn and can even appear disinterested. I hope that there will be no attempt to assess an individual child’s distress because I can foresee the problem of some families blaming that child for not caring enough, and therefore blaming that child for somehow not falling into a group that could have had more benefit. Sadly, transference occurs in bereavement and sometimes bereaved parents project their anger at the death on to the way in which the bereaved child is behaving and are on a very short fuse with the child, which compounds that child’s isolation. These are complex situations and there are serious long-term sequelae.
When a parent dies the support that the state offers must be easy to understand. It must support the widowed parent in providing support to their grieving children. Noble Lords are well aware that the death of a parent places enormous pressure on the rest of the family. The surviving parent has to both provide stability to children and adjust to life as the sole carer and earner while dealing with their own grief as well as that of their children. Quite often they have had no time to begin to adjust to impending widowhood—for example, in any sudden death, whether it is through a road accident, manslaughter, murder, suicide or whatever—and yet their children’s need for stability following the death of a parent makes it vital that the surviving parent is available to them, is present and is able to respond to their needs, which may change almost from minute to minute, hour to hour.
Stopping payments after only one year will have a significant impact on family finances but the major disruptions include the widowed parent often having to increase their working hours to replace lost income, thereby being less available to the children at the time when they are most in need of support. Amendment 18 seeks to increase the period of time that the bereavement support payment is payable to at least three years or until the youngest child has reached the age of seven, whichever is the longest period.
Can the Minister clarify the cost analysis that underpins the decision to end bereavement support payment after only one year, because one year is much too short to address a family’s needs? Removing the payment at the first anniversary of the death adds an additional pressure on the family at a time that is already very emotionally difficult when they often relive the acute episode surrounding the bereavement. Many families report that the second and subsequent years following bereavement are even harder than the first because support from friends and family tends to disappear and children can experience late effects of dealing with grief and bereavement.
The current allowance is paid until the youngest child leaves full-time education. The proposal to reduce this to a period of just one year is a dramatic change. Data provided by the Childhood Bereavement Network suggest that only one family in 28—that is, 4%—claims for less than one year. Most families would therefore receive payments under this Bill for a much, much shorter time than they would under current arrangements, especially if the children are younger. In Committee I described the shortening of this period of time as cruel. A year is a very short time in the life of those bereaved, whether adult or child.
The current benefit is paid until children leave full-time education in recognition partly of the complex emotional needs of young children. Removing the payment when the dependent children are very young is particularly worrying. Pre-school children become very clingy when they realise that one parent is no longer around. They require stability and security. The grief of losing a parent is challenging enough without compounding the disruption caused by the stress of worsened financial hardship for the surviving parent with the premature ending of a bereavement support payment.
Amendment 19 seeks to clarify that the bereavement support payment will be payable to a widow who is pregnant at the time of her spouse’s death. Can the Minister confirm that when the spouse of a pregnant woman dies the allowance would be payable to her? Amendment 20 seeks to clarify what support would be offered in the tragic event of both parents dying. Can the Minister confirm that in the event that both parents die, the guardian of the surviving children under the age of 18 will be eligible for any bereavement support payment which would have been paid to a surviving parent had that parent not died, and that the guardian has six months in which to lodge the claim? Can the Minister also confirm that the changes to the bereavement support payment do not affect the guardian’s allowance? Finally, can the Minister confirm that changes to the bereavement support payment do not affect child benefit?
Lord Rix (CB)
My Lords, I cannot claim to be either a young widow or to have young children. My children are actually middle-aged but my wife died a year ago last week and I know perfectly well that a year is really not sufficient time to put to one side all the problems which arise from the death of a partner. I was married for 64 years and, both for my children—middle-aged as they may be—and for me, the grief continues. I know perfectly well that if you are a young widow with young children, to be asked to change your life or to look at the possibility of going into work after six months is absolutely absurd. I support both these amendments with all my heart.
The Earl of Listowel (CB)
My Lords, I am sure that the House will want to reach a conclusion on this debate as soon as possible, but as treasurer of the All-Party Parliamentary Group for Children I would like to express my strong support for Amendment 21, tabled by the noble Baroness, Lady Hollis. I also pay tribute to the Minister for the care with which he has clearly been considering this very sensitive matter. That does not surprise me given that his great-aunt, Anna Freud, set up the Hampstead War Nurseries towards the end of the Second World War. She dealt with children who had been separated from their parents and provided them with much needed care. She also made forensic observations of what happens when a child is separated from the parent, looking at the different sequelae of those changes. What she discovered was that while she could feed the children well and provide exercise so that they were healthier, the emotional damage done to them as a result of being separated from their parents was simply huge. The concern must be that if widowed parents are not well supported and given all necessary consideration they may emotionally withdraw from their children, with all the adverse consequences highlighted by the noble Lord, Lord German, in Grand Committee.
The Lord Bishop of Wakefield
My Lords, having been one of the signatories, along with 26 other Anglican bishops, to the letter that went to the Daily Mirror last week, I am loath to speak too much about amendments to government legislation. However, on this particular occasion, because bereavement support is such a notable part of our business and ministry, I am very bothered about the direction in which the legislation is going.
I should like to reinforce what was said earlier by the noble Baroness, Lady Hollis, about cost. It seems to me that it is not a question of cost but of how long support is given to people. What many clergy learn and what people often forget is that, as the noble Baroness said, it is not just the first three months which are difficult—the problems continue throughout the whole of the first year. More than that, it is a matter of showing support for people over the whole period of time that the emotional pain of bereavement continues to be very severe. The issue of supporting people financially has an impact on that emotional pain.
Speaking on behalf of a group of people who spend so much of their time trying to support those who have been bereaved and who need to understand how they can be helped, we might take good note of these amendments. They will not cost more money. They have been tabled simply to try to offer more support over a longer period of time—not only in the raw first year, but over the first three or four years, and particularly where young children are involved and the emotional impact is even greater.
Lord German
My Lords, these are delicate and sensitive issues. I pay tribute to the noble Baroness, Lady Hollis, for using her ingenuity to make sure that these issues are right at the forefront of our discussion on Report. The major issues have already been raised and were expressed from these Benches both at Second Reading and in Committee. The evidence I quoted from the research literature on these matters identifies absolutely clearly that one needs to be extremely careful when dealing with these very difficult times for families. Indeed, what we should recognise is that some people may be able to regain a sense of normality more rapidly than others. You cannot make a distinction or see clear lines between one family and another. It seems that this is very much about the circumstances in which people find themselves and how those positions are managed and handled. The issues raised by these amendments have to be a source of major concern to Members on these Benches, and as I say, they were raised earlier.
I am grateful to my noble friend Lord Freud for giving us an opportunity to discuss these matters in considerable detail between the Committee stage and today, and to help shape a Government response which adequately meets the concerns expressed. An adequate response from the Government has to satisfy the discussion we had in Committee and be highly relevant to the issues already raised today in this Chamber about these sensitive matters, particularly relationships within families. I want to see a process that meets the issues and was raised in that evidence. This is what I want to challenge and talk to my noble friend about.
Baroness Sherlock (Lab)
My Lords, I am not surprised, having sat through Committee, that this has been such a powerful debate. We have had some very important, moving and well informed speeches at all stages of the Bill touching on these subjects. I am very grateful to the noble Baroness, Lady Finlay, and to the noble Earl, Lord Listowel, for sharing their expertise in these areas, as well as to the noble Lord, Lord Rix, for being willing to share with us the experience of bereavement and its ongoing impact on one’s life at any age.
My noble friend Lady Hollis laid out the case very strongly at the outset. I am delighted that the Minister is interested in reviewing the impact on families with a distressed child and how that relates to conditionality in the future. It is an excellent commitment and I look forward to seeing the results of it. It is up to my noble friend Lady Hollis to make a judgment on this but I do not think that that in any way precludes the need for this amendment, which is about a very specific category of person—people who are bereaved and who may find themselves going on to claim universal credit but who would normally be expected to go out to work because they had children of school age. Both of those things are important.
I still have with me the very powerful speech made by the right reverend Prelate the Bishop of Derby at Second Reading, in which he laid out his experience of pastoral care for the bereaved, something reprised very effectively today by the right reverend Prelate the Bishop of Wakefield. I do not need to say very much more about why this matters. Many Members of this House have had experience of bereavement in one way or another and there can be few more important issues than how a country supports its citizens when the worst of all possible things happens to them.
The Government’s case throughout this debate has been that these bereavement reforms are not really about money. From 2016 to 2020, they estimate the changes will cost an extra £110 million, because they will protect payments under the current system, but that thereafter, in total, there will be small savings. The argument is that these are reforms not cuts. The Government have said throughout that they want to simplify the system and put resources where, in their view, they are most needed: as a short-term intervention to allow a bereaved spouse or civil partner to deal with the immediate costs of the death of a partner. If support is needed in the longer term, that is what universal credit is for.
Amendments 18 to 20, in the name of the noble Baroness, Lady Finlay, address the question of how long bereavement support should be paid for. In Committee, the noble Baroness laid out some very moving circumstances in which families could find themselves, clearly drawing on her own clinical experience. I know that the Minister expressed sympathy with what she said, and it may be that his review of distress will address that. I would be interested to see what he has to say when he comes to speak.
Amendments 2 and 21, in the name of my noble friend Lady Hollis, quite specifically seek to relax the work conditionality requirement for those in receipt of bereavement support payment. This is particularly important for widowed parents. There is a difference between those who do not want to work and those who would like to work, or go back to work, but who have been forced to recognise that the reality of the state that their children are in is such that they have to choose—of course they will choose their children and not work, unless they have literally no choice. Some parents will need a longer period, both to adjust to their own grief and shock and to deal with the grief and shock faced by their children.
It has already been pointed out that the regulations for universal credit mean that kinship carers are exempt from work conditionality for a year from the time that they assume the care of the child. This was agreed by the Minister—under the persuasive pressure of my noble friend Lady Drake and others—in recognition of the fact that adults need time to adjust to being, effectively, a single parent. Why should the same principle not apply to bereavement? I would be very interested if the Minister could answer one question about his review: does he intend to change the regulations to allow bereaved parents specifically to be exempt from conditionality? In Committee, he said that he was reviewing this and that he wanted to change the guidance given to decision-makers in jobcentres. But that is a very different question altogether. I can see why that might be the way forward for distress in general—after all, distress comes in very different forms and some judgment would have to be made about when the family was distressed. The awful thing about bereavement is that it is horribly clear: one is either bereaved or one is not, and I therefore do not think there is a need for the kind of flexibility that might be needed in other circumstances.
I also worry because I have heard many cases, as I am sure other noble Lords have, where young jobcentre officials, with the best of intentions, ended up making bad decisions because they did not properly understand what it was like to be a single parent trying to juggle more than one child and a part-time job. That person could of course simply say, “I am sorry but despite whatever you say, I am not going back to work because I have to prioritise my children”. If that happens, their benefits get sanctioned. They can appeal, but do we really want them to have to go through that six months after losing their husband, wife or civil partner? When 58% of appeals against sanctions on jobseeker’s allowance are successful, how much are we willing to bet the farm on the effectiveness of decisions by individuals in jobcentres? In my case, it would be not very much.
At Second Reading the noble Lord, Lord German, used words such as “harsh” and “cruel” to describe the decision to force widowed parents back to work after six months. I believe that he was right. He cited the research, which he touched on again today, showing that outcomes for children very much depend on the effectiveness of the remaining parent in coping. That is partly about their availability to children. All that this amendment from my noble friend Lady Hollis does is to ask that those widowed parents who need to claim universal credit alongside bereavement support payment to make ends meet should not be required to go back to work for 12 months. After all, the Government have decided to focus their support on that first 12 months, so surely they should be willing simply to stretch this for the same period.
I have heard it said that a year is too long: since employers do not offer bereavement leave for a year, why should the state? It is because employers cannot do that that so many parents end up giving up their jobs when they lose their spouse or civil partner. The combination of burdens is simply too much to cope with. Universal credit is meant to be the safety net for those very parents, and it must be here. This amendment specifically recognises that the Government are planning to recycle all the resources spent on bereavement to be able to create this new system. All it does is to give them the power to recycle that money in whatever way they want, such that that reform should include this small change—that for 12 months after losing one’s husband, wife or civil partner a parent should not be forced back to work.
We should be clear that a decent society will not put bereaved children in the position of having lost one parent only to find that the other is not able to give them the level of care that they need at this crucial time. Many people in this House will know that losing a parent in childhood is a life-changing event: one never gets over it. We cannot protect children from that horror but when it happens, please let us at least say that we will support the remaining parent as best we can. It is clear that this House does not think that the Government have got this part of the Bill right. Amendments 2 and 19 give them the means and the incentive to go away and get this right. I urge the Minister to accept them.
Lord Freud
My Lords, losing a spouse is one of the most tragic circumstances that a person will have to endure and, as such, it has been recognised since the outset of the welfare system that the bereaved need some financial assistance. Bereavement benefits form a crucial part of state support but limited reforms over the years have led to a complex system, which has not kept pace with changes in the benefit system or wider changes in society. This legislation will address this. With a simple payment structure focusing support on the period immediately after the bereavement and a single contribution condition, the new bereavement support payment will be far more easily understood and claimed. It will mean that more people will benefit, particularly younger widows.
A claim to the new bereavement support payment is made by the surviving spouse or civil partner. The noble Baroness, Lady Finlay, raised those extremely tragic cases where not only is there one bereavement but the surviving spouse dies shortly afterwards. She is of course right that there can be no expectation that a claim is made by the surviving spouse in such circumstances. I take this opportunity to make it absolutely clear that, as with the current benefits, there will be arrangements in place for claims to be made posthumously. Every year, the Department for Work and Pensions receives around 10 posthumous claims to bereavement benefits made on behalf of a bereaved spouse who has subsequently died. There are regulations to ensure that appropriate payment can be made in respect of these claims.
Baroness Hollis of Heigham
My Lords, the noble Lord has misrepresented both my amendment and my speech. I said that many parents would welcome it, but that the decision on at which point within that 12 months they returned to the labour market lay with them, not with the local benefit office.
Lord Freud
The point I am trying to make is that it is far better to recognise that individual responses to grief vary. As a number of noble Lords have said, grief often does not manifest in behavioural and emotional challenges until months or even years down the line, as a child matures. That is why, under universal credit, advisers have the flexibility to personalise requirements at any point, responding as circumstances arise. Where parents are facing difficulties with school, childcare arrangements or other extenuating circumstances, advisers can limit or even lift requirements.
I recognise that the application of that flexibility depends on the ability of those advisers. While I feel that our advisers are able, it is important to ensure that they have the best guidance and training to deal with such difficult cases. That is why we are currently working with experts in the field including the Childhood Bereavement Network, the Children’s Society, Cruse Bereavement Care, WAY and Gingerbread, to ensure that guidance and learning clearly articulate how advisers can identify and support parents in these circumstances, including the particular circumstances in which it would be inappropriate to apply conditionality. Our advisory services are also being repositioned as a profession with a clear career path, accredited learning and ongoing professional development. The learning programme will ensure that advisers have up-to-date skills to deal with any claimant interaction and support them in making relevant and appropriate decisions on an individual basis.
That is the standing position. I now move to the more specific response that I wish to make following our discussions in Grand Committee, particularly in answer to the points raised by the noble Baroness, Lady Finlay. I recognise that there are circumstances in which children could be in considerable distress and in which it is clear that conditionality should not be applied and flexibility is essential. I do not, however, see such cases as being limited to bereavement. There may be other circumstances in which children need additional care—for instance, where a family is fleeing domestic violence.
I assure the noble Baroness that we are not looking for a measure to define “distress”. Indeed, we need to establish exactly what the expression means; we are using it as a shorthand and there may be a much better way of capturing the concept, which is one of the things that a review should do. We are looking to identify specific circumstances in which we could expect a child to be distressed, and in which they will therefore have additional needs that need to be recognised. Claimants would need to demonstrate only the circumstances they are in, not the fact of distress, which is, as the noble Baroness has pointed out, extraordinarily difficult to establish.
I therefore want to conduct a review as quickly possible, in order to embed any new rules in the regime before we take new claims to universal credit from families. That is why I propose to undertake the review myself. I would like, in practice, to conclude that review by June or so. I will report back to the House following that. I am not quite sure of what form that will take but we will find the right form nearer the time.
Baroness Hollis of Heigham
I am sorry, but why? The noble Lord has already made the judgment on kinship parents. This is a permissive amendment, which he can draw on if needed. If he does not need it because of his review he does not need to deploy it. It is there as a safety net, so why is he asking the House to make it an either/or judgment?
Lord Freud
My Lords, this is not a permissive amendment. It makes a change to the conditionality regime for one element. If I need to look at how I do a review, I would have to look again at the specific context of doing this review.
Baroness Hollis of Heigham
I am sorry; I crave the indulgence of the House. Let me read the substance of Amendment 21:
“The Secretary of State may by regulation and within the overall budget for bereavement support payment exempt any widowed parent from work conditionality while in receipt of said payment”.
The Secretary of State “may” do that by regulation. As I said, the amendment is permissive. I am sorry that the noble Lord did not, perhaps, fully appreciate that.
Lord Freud
My Lords, let me make my point here. I will have to look again. As noble Lords know, a “may” in this context is a very substantial “may”. I will have to look again at the context in which I would want to do something such as this. I may very well want to do it, but I cannot make a commitment to have both at this stage. On that basis, I urge the noble Baroness to withdraw her amendment.
Baroness Hollis of Heigham
My Lords, I am still slightly baffled by the less than satisfactory response of the Minister. Let me first thank the noble Baroness, Lady Finlay, the noble Lord, Lord Rix, the noble Earl, Lord Listowel, the right reverend Prelate the Bishop of Wakefield and my noble friend Lady Sherlock for their very powerful and moving speeches on something that really matters: trying to protect and support widowed parents for the first 12 months of their bereavement. I welcome the Minister’s offer of a review on distress. However, what he has suggested is so wide that I rather doubt—although I would be pleased to be proven wrong—that he will be able to turn this into effective policy.
I give one tiny example, which I was thinking of as the Minister spoke. He was going to extend this to the distress of cohabiting parents when one of them dies. It is not too far fetched to suggest to the House a situation where a woman was with the father of her child or children in a cohabiting relationship but they then separated. She then had a period of perhaps five or seven years with someone else, to whom the children really connected and related. Then she moved on to a new boyfriend—a new stepfather—for perhaps the past year. Could the Minister tell me which of those three would have to die—forgive the language—for her to be entitled to bereavement benefit under the proposal of distress? Is it the recent stepfather, over whom the children are not especially distressed but the mother is highly distressed; the long-term stepfather, who has helped to bring them up, to whom the children were committed and over whom they are distressed while she is less so; or their natural father, who is giving them financial support and they see regularly? Which is it? I suspect one cannot do what the Minister seeks to do.
Lord Freud
My Lords, I am grateful to the noble Baroness for making the point for me. If we do these things piecemeal, we will not get the right answer. That is why my response to what the noble Baroness, Lady Finlay, said to me in Grand Committee was to think that we need to look at this comprehensively. We need to get this issue right across the piece and understand how to incorporate it as a whole into our conditionality regime. That is the response that I am looking to do, not to sort it out on the Floor of the House where we simply do not have enough information to do it properly at this stage.
Baroness Hollis of Heigham
My Lords, I make two points. First, we are not seeking to sort it out on the Floor of the House. I am seeking the consent of the House, if it is so minded to give it, to a permissive amendment, which does not commit the Government to anything they subsequently decide is inappropriate in the light of further research. The second point is that the Minister’s definition of distress is so wide that I genuinely believe, from my limited experience in Parliament, that he will find it very difficult indeed to turn it into deliverable policy. I am sure he is as aware as I am that it will end up depending on the discretion—he made this point himself—of local people in local benefits offices, such as the 23 year-old who will be interviewing the widowed parent. Is she numb? If so, does that mean she is coping or not caring sufficiently? Alternatively, is she voluble? Does that mean she is coping or not caring? He will have to peer into her soul and we should not go there.
The Minister says that he wants to help widowed parents to adjust, to,
“regain control of their lives”,
with tailored solutions. He is saying that the local benefits office, the 23 year-old, will decide. The 23-year old will turn her into his dependant, reliant on his judgment as to what she should do and what is best for her family. That is inappropriate and improper. You are making the adult back into a child and adding to her stress and distress. The Minister should not be going down that path. He will not be able to do it by clear policy; he will depend on discretion. Neither of those routes is satisfactory for a small and coherent group that we can easily define—that is, widowed parents with children following a bereavement.
The Minister is opposing a permissive amendment dealing with a small, specific group, which he can respond to exactly as he has already helped—and I am glad of it—kinship carers. He has allowed kinship carers 12 months off on work conditionality; he can do the same thing for this very specific group and make their work conditionality freedom align with the 12 months in which they are receiving bereavement benefit. After all, that is precisely why they have bereavement benefit in the first place. If they have it because they need support following their bereavement, at the same time they need the freedom from the additional pressure that the Minister’s work conditionality will ensure.
The Minister said that it was not quite either/or, but suggested that—
Lord Freud
My Lords, I just want to make the point that if you pick out particular groups and have legislation just for them, you end up with the kind of carbuncled benefit system that we are trying to escape from. I am determined to try to build a system that is coherent across the piece, and I want to look at all the situations to make sure that they are consistent.
Baroness Hollis of Heigham
My Lords, I understand the Minister’s support for grand schemes. We will see whether the grand scheme of universal credit, which I support, will deliver what he hopes that it does—and I hope it does. But here we are dealing with a situation in which we have kinship carers and widowed parents, and we may be talking subsequently about women experiencing distress in domestic abuse situations, and the Minister is trying to make something coherent. He is trying to fit them into one common mould, but he does not have to. He may come up with appropriate and different solutions for different groups because, as he himself said in his reply, every family is different and may need different help. This amendment would allow him to do precisely that.
The amendment does not cut across any review in any way, any more than his 12-month provision for kinship carers does. It seeks only to protect a small, identifiable and precise group from additional pressures of work conditionality at no cost at all and at a time when they and their children are most deeply distressed. I do not think that they should be put on the back burner for a review that may or may not deliver what I hope the House will think is the right path to take. If the review goes ahead and the Minister does not need the amendment, as it is permissive, he does not need to draw on it. If his review falters, which I think it will because he is asking too much of it, the amendment would give protection to some of the most vulnerable people in our country at the time of their deepest grief.
It is very simple. The amendment is permissive but says that we recognise the situation of widows and widowed parents and will give them, under the new system, one year of bereavement benefits and payments. This amendment asks for that one year, which we recognise is the period of most grief and distress, and that we should also not apply the pressure of work conditionality. This House has always looked out for widows and children, and I am asking the House to do it again today. The amendment is permissive and cost-free, and the Minister can build on it if he wishes to do the review. It is just a small safety net of help for grieving children and their grieving parent. I beg your Lordships to protect them tonight. I wish to test the opinion of the House.
Ukraine, Syria and Iran
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Wallace of Saltaire (LD)
My Lords, with permission I will repeat a Statement that the Foreign Secretary is making to the House of Commons.
“Mr Speaker, with permission I will make a Statement on the situation in Ukraine and Syria and relations with Iran.
Last week more than 80 people were killed and 600 injured during the worst bloodshed in Ukraine since the fall of communism. It was the culmination of unrest that began in November when President Yanukovych announced that the Government would not sign an EU association agreement. The House will join me in sending condolences to the families of those who died or were injured.
On Thursday I attended the emergency meeting of the EU Foreign Affairs Council, which agreed sanctions on those responsible for the violence, as well as assistance to promote political dialogue and help for the injured.
On Friday President Yanukovych and the opposition signed an agreement, also supported by the whole European Union, and I pay tribute to my French, Polish and German colleagues for their efforts to bring this about. But events have moved rapidly since then, including the departure of President Yanukovych from Kyiv and the removal of guards from government buildings.
On Saturday the Ukrainian Parliament, the Rada, voted to restore the 2004 constitution, to release Yulia Tymoshenko, and to impeach the President. He has said that he will not step down, but it is clear that his authority is no longer widely accepted. A number of members of the previous Government have been dismissed and appointments made in a new unity Government. Rada Speaker Turchynov has been appointed acting President until early elections on 25 May.
Ukraine now has a pressing need for constitutional reform, improvements to its political culture, free elections, an end to pervasive corruption and the building of a stable political structure. We look to the new Government to create the conditions for such change and, in a spirit of reconciliation, to ensure accountability for human rights violations.
For our part, the international community must work with the new Government to discourage further violence and agree international financial support. Ukraine’s financial situation is very serious and, without outside assistance, may not be sustainable. An economic crisis in Ukraine would be a grave threat to the country’s stability and have damaging wider consequences.
I discussed this work with the German and Polish Foreign Ministers over the weekend and spoke to Foreign Minister Lavrov of Russia earlier this afternoon. The Prime Minister has spoken to President Putin, Chancellor Merkel and Prime Minister Tusk, and the Chancellor discussed Ukraine with G20 Finance Ministers in Australia. Later today I will go to Washington to discuss this and other issues with Secretary Kerry.
While in Washington I will hold talks with the International Monetary Fund, which is best placed to provide financial support and technical advice in Ukraine. Such support could be provided quickly once requested by the new Government. It requires a stable and legitimate Government to be in place and a commitment to the reforms necessary to produce economic stability. International financial support cannot be provided without conditions and clarity that it will be put to proper use.
The noble Baroness, Lady Ashton, is visiting Kyiv today and I will visit shortly. Our fundamental interest is democracy, human rights and the rule of law in Ukraine. This is not about a choice for Ukraine between Russia and the EU; it is about setting the country on a democratic path for the future. We want the people of Ukraine to be free to determine their own future, which is what we also seek for the people of Syria.
On Saturday the United Nations Security Council adopted Resolution 2139 on Syrian humanitarian assistance, which the United Kingdom called for and co-sponsored. This is the first resolution adopted by the Security Council on the humanitarian crisis since the start of the conflict three years ago and it was agreed unanimously. It demands an immediate end to the violence, the lifting of the sieges of besieged areas and the unimpeded delivery of humanitarian aid including, importantly, across borders where necessary. It authorises the UN to work with civil society to deliver aid to the whole of Syria. It condemns terrorist attacks, demands the implementation of the Geneva communiqué leading to a political transition, and says that this transition should include the full participation of women.
The passing of this resolution is an important achievement, but it will make a practical difference only if it is implemented in full. We will now work with the United Nations and our partners to try to ensure that the regime’s stranglehold on starving people is broken.
The UK continues to set an example to the world on humanitarian assistance. Our contribution to the Syrian people now stands at £600 million: £241 million allocated for humanitarian assistance inside Syria; £265 million to support refugees in Jordan, Lebanon, Turkey, Iraq and Egypt; and £94 million of allocations that are currently being finalised. We have pressed for other countries to do more, including at the Kuwait conference on 15 January that resulted in more than $2.2 billion in new pledges.
The Security Council resolution is a chink of light in an otherwise bleak and deteriorating situation. An estimated 5,000 Syrians are dying every month. Nearly 250,000 people remain trapped in areas under siege. The bombardment of civilian areas with barrel bombs continues unabated and there are reports of attacks with cluster munitions as well. An inquiry led by distinguished British experts reported on the photos of the bodies of around 11,000 tortured and executed Syrian detainees. Some 2.5 million Syrians are refugees in the region, 75% of them women and children. The UN expects 4 million refugees or more by the end of this year.
Against this horrifying backdrop we continue to seek a negotiated settlement to end the conflict. But there is no sign of the Assad regime having any willingness whatever to negotiate the political transition demanded by the United Nations Security Council.
The second round of Geneva II negotiations ended on 15 February without agreement on future talks. UN and Arab League envoy Lakhdar Brahimi had proposed an agenda for a third round of talks focusing on violence and terrorism—the regime’s stated priority—and a transitional governing body, in parallel. The regime refused this. As a result the talks were suspended, with Mr Brahimi clearly laying responsibility for this at the regime’s door.
The National Coalition, by contrast, approached the negotiations constructively and in good faith. It published a statement of principles for the transitional governing body, stating that it would enable the Syrian people to decide their own future and protect the rights and freedoms of all Syrians. Those supporting the regime side, including the Russian and Iranian Governments, need to do far more to press the regime to take the process seriously and to reach a political settlement, as we have done with the opposition.
We will continue our support for the National Coalition and for civil society within Syria. We are providing £2.1 million for Syrian civil defence teams to help local communities deal with attacks, and improve the capability of local councils to save the lives of those injured and alleviate humanitarian suffering. This includes training, which is now under way, a communications campaign, and £700,000 of civil defence equipment. This includes personal radios, rescue tools, protective firefighting clothing, fire extinguishers, stretchers and individual medical kits.
The UK is also proposing a £2 million package of training, technical assistance and equipment support to build the capacity of the Free Syrian Police, working with the United States and Denmark. I have laid before Parliament a minute to approve £910,000-worth of equipment, including communications equipment, uniforms and vehicles for the Free Syrian Police. We also intend to make a contribution to the Syria Recovery Trust Fund, established by the UAE and Germany, which will focus on healthcare, water supply, energy supply and food security; and we are working with the Supreme Military Council to agree the best way of restarting our non-lethal support, which we halted temporarily in December.
The regime’s foot-dragging is also clear on the removal of chemical weapons from Syria. According to the Organisation for the Prevention of Chemical Weapons, only 11% of Syria’s declared chemical stockpile has so far been removed, and the regime has missed the 5 February deadline for removing all chemicals. This has delayed the destruction operation by months and puts the 30 June final destruction deadline in jeopardy. This slow rate of progress is clearly unacceptable. The UN Secretary-General and the OPCW have made it clear that Syria has all the necessary equipment to enable the movement of the chemicals. The OPCW’s director-general is pressing the Syrians to accept a plan that would see the removal of all Syrian chemicals in a considerably shorter period, enabling the 30 June deadline to be met.
Turning to Iran, the first step agreement with Iran came into force on 20 January and continues to be implemented. The E3+3 and Iran met last week to start negotiations on a comprehensive agreement aimed at ensuring that Iran’s nuclear programme is, and always will be, exclusively peaceful. The talks were constructive. The E3+3 and Iran agreed on the issues that need to be resolved as part of a comprehensive agreement; and in broad terms on the approach to negotiations for the coming months. The next round of talks will be in mid-March in Vienna. The E3+3 and Iran plan to meet monthly in order to make swift progress on the issues that need to be resolved in the ambitious timeframe we agreed under the November Geneva deal of implementation starting within a year.
The House should be under no illusion that the challenges here remain very considerable. A comprehensive solution must address all proliferation concerns related to Iran’s nuclear programme. To that end, existing sanctions remain intact and we will continue to enforce them robustly.
We continue to expand our bilateral engagement with Iran. Indeed, Iran’s non-resident chargé d’affaires is visiting the UK today. Last Thursday, we and Iran brought the protecting power arrangements to an end. This is a sign of increasing confidence that we can conduct bilateral business directly between capitals rather than through intermediaries. I thank the Governments of Sweden and Oman for acting as protecting powers since the closure of our embassy, and for their strong friendship and support for the UK. We will continue step by step with these improvements in our bilateral relations providing they remain reciprocal. We are, for example, working together on ways to make it easier for Iranians and British citizens to obtain consular and visa services.
On all these issues we will maintain intensive diplomatic activity in the days ahead and I will continue to keep the House informed on our work with other nations—whether it be in Europe, the Middle East or the prevention of nuclear proliferation—to ensure a more peaceful and stable world”.
My Lords, that concludes the Statement.
Lord Triesman (Lab)
My Lords, I thank the noble Lord, Lord Wallace of Saltaire, for repeating the Statement made in the other place, and the Foreign Secretary for providing an advance copy of it to the shadow Foreign Secretary, which I have read and which was of great assistance in preparing for our discussion this afternoon.
The events in the Ukraine demonstrate just how dangerous a moment this is. The deaths of more than 80 people and injuries to many hundreds more is ample demonstration of the personal cost to the population of a country eager for democratic change. I join the Government in expressing our condolences to the families of those who have been killed and our profound hopes for the recovery of those who have been injured.
It is far from clear what will happen next. I can see that there are deep differences in the Ukraine between those who want a modern European identity and those turning back towards a Russian, indeed, even, I think it is fair to say, Soviet-style identity. I do not accept, and fear the consequences of, the pejorative name-calling that we have seen in recent weeks. There may be a small number of nationalist extremists in the group who overthrew Mr Yanukovych, but I see no evidence at all that warrants the denunciation of the opposition by Yanukovych’s supporters or, indeed, by the Russian state media, in terms of an uprising of fascism in the country, as they have described it. Using the language of 1941 may be useful to opponents of change but bears no relationship to the real events of today.
What is needed today is systematic constitutional reform. What are needed are democratic institutions supported by popular elections to those institutions. What is needed is a willingness to determine democratically the balances between the different peoples in different parts of the country and the platform for reconciliation that only they can construct. What is decidedly not needed is any Russian statement about the potential need for what it has called “fraternal intervention”. That very phrase has a history, not least from the Czechoslovakian intervention of 1968. It is fundamentally unhelpful to hear that language because it leaves serious ambiguities as to what might happen next. No military intervention would be tolerable, and President Obama is surely right: Ukraine is not a piece on a Cold War chessboard. I assume that Her Majesty’s Government agree with this when they say that this is not a matter of choice between the European Union and Russia for the people of the Ukraine. It is essential that Mr Lavrov understands the goals of greater democracy in that country and a new generation potentially taking up the mantle. The global consequences of any military intervention are unthinkable. Ukraine is, whatever its financial difficulties—to which I must return in a moment—after the European part of Russia, the largest nation in Europe. It is rich in agriculture and many other resources, and in its culture. It stands at a key strategic frontier. Nothing could make a fraught situation worse than if there were to be some form of military intervention.
I make one other observation after talking with Ukrainian diplomats in the past couple of days. For the most part, they have said that they want to turn towards Europe and the EU. These are matters of choice for them, not me, but that is what they have expressed. They see it as a great economic opportunity, which sadly they need greatly, but just as much as a bulwark against corruption and a foundation for a reliable system of rule of law. However, you will find that if you speak to them they also think that the United Kingdom has far too little or possibly even nothing to add to the argument that they want to advance. They will tell you, without much diplomatic small talk, that the United Kingdom’s attitude to Europe is, at best, one of weak co-operation with that body that they aspire to join. At worst, the attitude is one of somewhat bloody-minded hostility likely to be seized on by those who are hostile, for nationalistic reasons, to a Ukrainian future that is more closely bound with Europe. Those diplomats take this matter seriously. Least of all can they understand—and they made this point to me with some strength—how the main party of government here in the United Kingdom left the centre-right Christian Democrat bloc, to which many Ukrainians see themselves as fairly naturally aligned, to gravitate towards a more extreme right alignment that they abhor and think is a risk to their country. That risk is being seized upon by the Russians.
Today the House will want to know what the United Kingdom can contribute to a peaceful outcome. I suggest that it could start by appointing a dedicated special envoy. This is a problem that is not going to go away overnight and will need to be addressed over a period of time. Ukraine’s economy is, as we have heard in the Statement, despite the fundamentals that should augur well, close to being wrecked. Is Russia still willing to contribute the financial support that it has hitherto offered to the Yanukovyck regime, or has that offer been withdrawn? I hope that the Minister will be in a position to tell us.
What contribution does the Foreign Secretary believe the IMF could provide? Two months ago he dismissed the idea advanced by my right honourable friend Douglas Alexander. Yesterday the Foreign Secretary agreed with the idea. Do the Government regret that the past months have drifted by, with the Ukraine drifting towards calamity? Of course conditions would have been needed at all stages, but how is the work on the conditions to be conducted in good time in order to have the impact that we now need it to have—it is plainly needed—yet avoid the mistakes, because the conditions are also about those, made by the Orange Revolution in 2004?
Will the Foreign Secretary call for the renewal of negotiations on the EU association agreement? In doing so, will he emphasise, as he will need to, the United Kingdom’s continuing support for the European Union, so that it is understood to be, in our view, a positive benefit? The Foreign Secretary has been talking to Mr Lavrov, as was said in the Statement, and I sincerely welcome it. Will he make these kinds of proposals to Foreign Minister Lavrov? Will he seek Mr Lavrov’s guarantee that Russia will not encourage south-eastern Ukraine to break away from Ukraine as a whole?
On Syria, we, too, welcome United Nations Security Council Resolution 2139. The position in that country, as the Foreign Secretary says, is grotesque and horrifying. He is quite right. Nevertheless, the humanitarian appeal is in desperate straits. We have called for a new donor conference to build funds that are desperately needed. Will the noble Lord, Lord Wallace, back this call this afternoon? What proposals do the Government have to encourage the regime’s supporters, especially Russia and Iran, to press Syria for a political settlement? There is every reason to think, as the Statement says, that the Syrian regime is not addressing the negotiations with any degree of seriousness. Assad is not serious. What are the Government’s objections to establishing a Syria contact group to encourage negotiations? As the Statement says, the current position is—I use the word used by the Foreign Secretary—“unacceptable”, whether we are talking about the use of chemical weapons or their decommissioning, or indeed anything else that the Syrians were expected to do as a result of the discussions that had begun.
On Iran, I repeat the congratulations offered to the noble Baroness, Lady Ashton. She probably feels burdened by congratulations these days but, goodness knows, nobody deserves them more. We welcome the framework agreement in Vienna last week. It is helpful and, I suspect, constructive in a limited way. Progress, however, is dependent on Iran sticking to the agreements it made last November. The number of centrifuges is reportedly still in excess of 10,000. A far lower limit was set in November. What steps do Her Majesty’s Government advocate to bring Iran into line with the deal that it itself has agreed? How will the Government here review the sanctions regime? I make none of these final points in order to be negative about what can be achieved or, indeed, about what has been achieved, but I know that these are conditions in which, if pressure is not continued in the right direction, the opportunities for backsliding are profound, and the dangers that come with them are still more profound.
I ask these questions out of sympathy, not hostility, for the objectives that have been expressed in the Statement, but the House will want to know the answers.
Lord Wallace of Saltaire
My Lords, I thank the noble Lord for his support for the Government’s approach. Perhaps I may simply say that the British Government do not presume that they do anything on their own in any of these circumstances. On Iran, we are working as part of the E3+3, which, as the noble Lord said, the noble Baroness, Lady Ashton, chairs so well. We are working on Syria with the Syrian core group, which consists of European countries, the United States and a number of Arab countries. The group continues to meet regularly as a means of pulling together those most concerned about the future of Syria. As the noble Lord said, the Foreign Secretary talks to his opposite number in Russia on a very regular basis. On Ukraine, we gave active support to the Polish, German and French Foreign Ministers in their efforts to help in Kiev. The Poles, after all, have a common border with Ukraine—and, to some extent, a common history—and we are part of a group of European countries that are of course actively engaged. However, in none of these, whatever Ukrainian diplomats may think, do we think that we operate separately from our partners and allies in Europe, across the Atlantic and across the Middle East.
In terms of asking the Russians not to do anything to encourage parts of Ukraine to split off, Crimea may in some ways be more of an immediate danger than south-east Ukraine. It may be one of the impacts of what has been shown on Ukrainian television in the past two or three days—in terms of the depths of personal corruption of the Yanukovych regime—that eastern Ukraine will be less prepared to resist the changes than it might otherwise have been. The Yanukovych regime, which was most strongly supported in the Donetsk region, as the noble Lord knows, has been more thoroughly discredited than we anticipated three or four days ago. Of course, what is happening in Ukraine is moving very rapidly and it is unclear what will emerge. We are working with others; I take the noble Lord’s point about whether we intend to appoint a special UK envoy, but I suspect that my right honourable friend the Foreign Secretary would say that we are working with others—we are part of the international community on this—and we intend to go on working with them.
In terms of the compliment made to the noble Baroness, Lady Ashton, we should also recognise that, of the women doing extremely valuable work in international diplomacy at present, the noble Baroness, Lady Amos, is also doing a certain amount of very valuable and quite dangerous work in humanitarian assistance to Syria. We should be proud of the extent to which British women—Members of this House—are attempting to assist in these very difficult and, to a considerable extent, interconnected conflicts.
Certainly, a number of Governments, including our own, have said that the Vilnius association agreement remains on the table for Ukraine, but I again stress that we are not trying to make Ukrainians make a definitive choice between joining the European Union and leaving the Russians behind or the reverse. Clearly we have to find a solution through which Ukraine can adopt a more open form of government and a much stronger sense of the rule of law, begin to rebuild its very battered economy and restructure its enormous debts to a range of other countries. That, however, requires a new Government to emerge and we and others will do all we can, as we move towards the presidential elections now set for May, to assist the interim Government in moving in those directions.
Baroness Falkner of Margravine (LD)
My Lords, I say to my noble friend that I am extremely relieved to hear that the Foreign Secretary is travelling to Washington to have discussions with the US Administration but, more importantly, to have discussions with the International Monetary Fund. Can he tell the House how much leverage we have with the IMF? We know, of course, of its exasperation that €300 billion was expended on very necessary eurozone bailouts but that only €610 million was pledged to Ukraine before the crisis started in November. Perhaps there has been a lack of urgency on the part of the IMF-EU relationship with Ukraine that has led us to where we are now.
I also congratulate the Foreign Secretary on the very measured tone that he has taken in terms of Russia. We need to co-operate with Russia and Ukraine and we also need Russia on Syria. However, on Syria—I do not wish to detain the House, I will be brief—surely we need to be tougher with Russia because we have wasted, some might say, two opportunities now in Geneva without seeing any progress whatever. To what extent might we help the Free Syrian Army to gain access to weapons so that it can defend wives and children?
Lord Wallace of Saltaire
On Russia and Syria, I remind the noble Baroness that the resolution passed on Saturday in the UN Security Council was passed unanimously. This demonstrates, to an extent, that the Russians are beginning to lose patience with the regime, which is bombing, starving and besieging its own people throughout much of the country. That is at least some step forward. Of course we engage with the Russians as actively as we can on these and a number of other subjects.
On the question of help to the Syrian National Council and the moderate opposition in terms of weapons, the Government take the position that the House of Commons showed its unwillingness to provide military support in Syria and that we will not change our policy on that until we have brought that issue back to the Commons. That may happen at some time but, at present, we are providing non-lethal assistance to the Syrian opposition and will continue to do so.
Lord Jay of Ewelme (CB)
My Lords, first, I welcome what the Minister has said about the moves to re-establish normal diplomatic relations with Iran. The more difficult and more complex our relationships are with countries, the more important it is to have a well plugged-in embassy in place and I hope very much that we will have normal diplomatic relations with Iran as soon as may be.
Secondly, and this echoes what the noble Baroness, Lady Falkner, was saying, it seems that the link between these three countries—Ukraine, Syria and Iran—is the role of Russia. I was glad to hear that the Foreign Secretary has spoken to Mr Lavrov this morning. Will the Minister confirm that the strengthening of our engagement with Russia, both bilaterally and through the EU and other international organisations to which we belong, should now be a real priority for our foreign policy?
Lord Wallace of Saltaire
My Lords, I am well aware from many conversations with the Foreign Secretary that he has been working extremely hard over the past six months and more to engage the Russians on a wide range of issues; as the noble Lord will know from long experience, this is not always easy. It has been something that we have needed to do. Whether one calls the negotiating group on Iran the E3+3 or the P5+1, some of the members of that group are easier to work with than others but we do try to hold them all together.
On the current question, as I said in the Statement, we are moving forward gradually and proportionately and looking for reciprocal gestures and, so far, so relatively good. As the noble Lord will know, the current regime in Iran is complex and one always has to be aware that there are other aspects of the regime from the ones to whom we are talking.
Lord Howe of Aberavon (Con)
I wish to say only a few words and to concentrate on Ukraine in this context, because it is an unusual subject for us to be considering and it is in a very serious condition. I am glad also to be here in the presence of the noble Baroness, Lady Williams of Crosby, as very shortly after Ukraine began emerging from the regional history the two of us were invited to form part of a multinational advisory group in Ukraine, helping it to develop its nationhood. At different stages we had the privilege of meeting both Yanukovych and Tymoshenko. It is very important to hear that our Government are supporting Ukraine with its problems at present; it certainly needs it.
I remember that when the two of us went down for the first time into Independence Square it was full of people, and we could not help noticing the statue of Stalin covered over with posters on behalf of the Pope. I remember that it was Stalin who said:
“The Pope! How many divisions has he got?”.
It shows, in a way, the extent of the divisions between the two groups in those early years of Ukraine’s growing independence. Having met both Yanukovych and Tymoshenko, one realises that they are both figures of some substance and figures facing real problems without all that much background and without assistance. It is important that we recognise the significance of Ukraine as an independent country of some real substance in the future, and I am delighted that Her Majesty’s Government are already doing so to that effect. It deserves it and I am sure that we can give some real help.
Lord Wallace of Saltaire
I thank the noble and learned Lord for all those comments, with which I agree.
Lord Hurd of Westwell (Con)
My Lords, has my noble friend seen some rather disturbing press reports today about rows and ructions within the group of Syrians who are opposed to the Assad regime? This has happened before and it may happen again, but how does my noble friend assess the cohesion of the anti-Assad forces in Syria?
Lord Wallace of Saltaire
That is a very difficult question to answer in some ways because, as the noble Lord well knows, there is a very large variety of fighting groups. Indeed, in north-eastern Syria in the past week or two the moderate forces in the opposition have been fighting radical jihadis to expel them from ground otherwise occupied by the opposition. However, my experience of the Geneva II talks so far is that the representatives of the Syrian National Council have been more coherent and more constructive than some had predicted in advance. We are doing all we can to support the Syrian National Council in being an inclusive body, including Kurdish and Christian representatives, women and so on, and in strengthening its links with the moderate fighting forces on the ground. Of course, the picture remains extremely unclear. It is currently very difficult to get around inside Syria for obvious reasons, but we are a little more confident than we were that there is a reasonable opposition willing to work for a transition regime, through which we and others can work.
Lord Ahmad of Wimbledon (Con)
I think that we should hear from the noble Lord, Lord Wills, because he has been trying to get in for a while.
Lord Wills
I am very grateful and my question is brief. The Minister will be aware of reports that there has been a significant flight of capital from Ukraine in recent weeks. What steps are Her Majesty’s Government taking to ensure that assets that have been corruptly acquired in Ukraine are not being laundered in this country?
Lord Wallace of Saltaire
My Lords, that is a question that I have asked myself inside government. We are concerned about the movement of funds whose origins are not entirely clear. I am assured that the Government are monitoring these movements, but of course it is a matter of concern.
Lord Elystan-Morgan
My Lords, it is utterly laudable and understandable that the United Kingdom and the other countries of the European Union should commit themselves to substantial economic aid for Ukraine. However, will the Government give an unreserved commitment to abjure every temptation to try to involve Ukraine in any militaristic alliance or allegiance with western European countries, bearing in mind that the chief port of Ukraine, Sevastopol, is the base of the Russian Black Sea fleet and that such a militaristic course, though tempting on the face of it, would be utter insanity?
Lord Wallace of Saltaire
My Lords, I have seen the base of the Russian Black Sea fleet in Sevastopol with the Ukrainian Black Sea fleet, such as it is, not far away. I recall that someone for whom I used to work, Admiral Sir James Eberle, was invited in the early 1990s to advise the Russians and the Ukrainians on how the Black Sea fleet should be divided between the two. His recommendation was that the best thing was to scrap the entire fleet. Unfortunately, the advice was not taken.
The Lord Bishop of Wakefield
My Lords, perhaps I may focus my question on Ukraine. It seems to me that there are some senses—not exactly repetitions—in which we are seeing replayed some of the things that were not resolved in the early 1990s with the collapse of the Soviet Union. I remember that at that time I was working at Lambeth as the archbishop’s foreign secretary, as it were, and on one occasion the telephone was brought to me in the bath. There was a call from the gatekeeper telling me that Mr Gorbachev was in captivity in the Crimea and he thought that I ought to know so that I could do something about it. Some very good and quite low-key, and low-cost, initiatives were taken by Her Majesty’s Government at that time to support the development of democracy in the various republics that resulted from the collapse of the Soviet Union, including Ukraine. Can we be reassured that, once things become a little more stable, those sorts of initiatives might be looked at again? I am suggesting not carbon copies but that sort of thing.
My other point is that only the churches never recognised the division of Europe. The Conference of European Churches always worked across Europe. There are very serious divisions in the churches in the Ukraine, often reflecting some of the fragmentations that exist in the country as a whole. Again, that is another area where Her Majesty’s Government might work with others to see how one moves towards a more democratic situation.
Lord Wallace of Saltaire
My Lords, I continue to learn how close church links can be across national boundaries. I was in Armenia some months ago and was met by a very chatty archbishop, who seemed to know almost every bishop I had ever met in this country. However, we all know that the Orthodox Church in and across the former Soviet Union is a very complex and divided entity, and not all its branches are committed to anything that we would recognise as a liberal approach to organised religion. Sadly, the different branches of the church in Ukraine represent that rather well.
Baroness Williams of Crosby (LD)
My Lords, along with the noble and learned Lord, Lord Howe, I had the honour to be one of those who advised the Ukrainian republic at the moment of its independence from Russia, and I have kept closely in touch with it ever since. I begin by saying—I shall not be long—that the noble Lord, Lord Triesman, is absolutely right in indicating that the way in which Ukraine has been desperately trying to find security and, not least, to strengthen its relationships with the EU is an astonishing statement of trust in the EU. Perhaps it is time that we recognised that rather more than we sometimes do. It is a statement of belief in the future of a united Europe.
Perhaps I may ask one question of a practical kind. Outside the realm of governmental relations, how far does the Minister believe that in relations on a cultural level, on a religious level—indeed, with the appointment of Pope Francis possibly much more easily than in the past—and, not least, on an educational level we could establish a much stronger and more helpful relationship with Ukraine than we have done without putting at risk its relationship with Russia? I fully agree with the noble Lord, Lord Elystan-Morgan, that that relationship should not be made into a military one. I believe that there is much ground here for extensive and helpful relations between this country and what I hope will, before long, be the emerging democracy of Ukraine.
Lord Wallace of Saltaire
My Lords, I did not answer the question from the noble Lord, Lord Elystan-Morgan, about military alliances. Across what the EU has called the “eastern neighbourhood”, we are aware that some countries—for example, Georgia—have a stated ambition to join NATO, and that is another delicate set of issues with which we will all have to deal. I have to say to the noble Baroness, Lady Williams, that I think I beat her to help the new Ukrainian Government. The John F Kennedy School of Government asked for a Wallace to go to a conference in Kiev in December 1991. I found it almost surreal talking to a newly independent Government about the attributes of statehood that they suddenly found themselves having. I know that the noble Baroness, with the rest of the Kennedy school and others, then took over a much more detailed programme.
We are, of course, entirely open to cultural and educational relations. We very much want to work with Ukraine. I have no doubt that the British Council and others will wish to be engaged in as much assistance to Ukraine as possible—in particular, helping it to develop a much clearer concept of the rule of law and of the importance of law in every aspect of the economy, society and government.
Baroness Symons of Vernham Dean
My Lords, on Syria, in discussing UNSCR 2139, the Minister made the point that it was passed unanimously, which is very much to be welcomed. However, did the British Government press for it to be a chapter 7 resolution? As the Statement rightly said, the passing of the resolution is an important achievement but it will only make a practical difference if it is implemented in full. As it is not a chapter 7 resolution, what sanctions can be invoked if the siege of the 240,000 people continues; if there continue to be 5,000 deaths every month in Syria; and if the chemical weapons are not dismantled by 30 June this year? Without a chapter 7 resolution, is there really nothing very much that the UN will be able to do?
Lord Wallace of Saltaire
My Lords, we are doing our best to carry the P5 with us as we go. That is an important part of where we are going. It is extremely important that we got the first resolution on Syria for some time agreed unanimously by all participants. That is a significant step forward and we should not underrate it.
I agree that the situation is appalling. I am told that somewhere between 300,000 and 500,000 people are trapped in Aleppo at the moment. Part of the expectation of what will happen is that there may be another surge of refugees across the frontiers in the next six months if some of these sieges are lifted, as, of course, we very much hope they will be.
The fact that this is not a chapter 7 resolution does not necessarily mean that attitudes—including the Russian attitude and, perhaps with it, the Chinese attitude—will evolve. The behaviour of the regime in killing and starving its own people is losing the sympathy of the whole international community.
Lord Alton of Liverpool (CB)
My Lords, the Minister answered the noble Baroness, Lady Symons, by talking about the role which the United Nations Security Council might play in the future. One of the things we should be doing is looking at the role of the International Criminal Court and the ability of the Security Council to make a referral—not least because Ban Ki-Moon only this week said that unspeakable suffering was being experienced by the children in Syria, with some 10,000 of those killed so far being children. In the Foreign Secretary’s Statement we heard about the barrel bombs that are continuing to rain down on Aleppo; the sieges being undertaken in places such as Homs, where people are being starved to death; and, in previous times, the use of Sarin gas and the fact that only 11% of chemical weapons have been removed thus far. Surely it is time for us to start thinking about collecting the evidence against those who have been responsible for these deeds, whether they come from extremist militant groups or the regime, to ensure that one day they will face their day of trial.
Lord Wallace of Saltaire
My Lords, a number of groups, both governmental and non-governmental, are collecting evidence of atrocities in Syria as we go forward. We are committed to a transition regime rather than a destruction regime because we are well aware of the lessons of Iraq where, under American leadership, most of the institutions of Saddam Hussein’s state were dismantled, leaving us with an ungoverned and ungovernable country. We are also very clear that in any transition there is no place for the core members of the Assad regime, and that is what we intend to negotiate through the Geneva II talks.
Pensions Bill
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
“Pension statement
(1) The Secretary of State may by regulation introduce arrangements for the periodic notification to individuals of their entitlement to request a pension statement.
(2) Such regulations shall not require the provision of such notification before a person has reached the age of 45 nor, subject to subsection (3) below, more frequently than once every five years.
(3) Such regulations shall require notification of entitlement to receive a pension statement in the penultimate year before a person reaches state pension age.”
Baroness Hollis of Heigham (Lab)
My Lords, like others, I am delighted that we are introducing a new state pension, based on 35 years of contributions, which will help to float older people off poverty and encourage savings. However, if that is to happen, people have to know where they stand as they go along, especially women who may have acquired credits and young people on short hours-contracts, on which we voted earlier today. They need to know how reliably their state pension entitlement is building up and whether they need to take any action to make good shortfalls.
It seems obvious, does it not, that if we want people to build a pension they must know how they are doing, how far they have got and what they may get? We expect this from the private sector. Most of us get not only yearly but six-monthly statements about our ISAs, for example, and how they and we are doing. Usually—not always—it encourages us to save more. We all agree that we need transparency about charges and better information and guidance about our financial choices. The Government set up a money advice service to help people do precisely that.
Along with my noble friend Lord McKenzie, who regrettably cannot be in his place today, I was again taken aback in Committee to learn that there will be no such service and support in the field of state pensions. On the biggest investment a person may have—their pension—which, for many people, will be worth more than their home, they are working blind. People will be working and contributing, or not, and claiming credits to which they are entitled, or not, without any information and guidance to help them until shortly before they retire, when it may be far too late to change the hours of their job or claim a carer’s credit which might have brought them safely into the NI system.
How many women in their 40s and 50s with teenage children know that if they work 16 hours a week at minimum wage they will not usually be building a state pension, but at 18 hours a week they will? How many women know that by caring for elderly relatives for 20 hours a week they could, and should, get a carer’s credit? Not many, yet it is one of the most important things they need to know. How many women even know that they will not get a married woman’s dependant pension from 2016 on? Very few, I suspect. We do not and will not tell them, unless they have the wit to ask, until it is almost too late to do much about it. It is absurd and shameful. The DWP’s refusal to provide a level of service is unacceptable. None of us would accept this from the private sector. Indeed, the private sector would probably be pursued and prosecuted if it behaved like we do.
What is the Government’s position? They will respond to a query, which is likely to come from the alert, educated and informed, but they will not bother to trouble those who most need advice, information and guidance. Those who do not inquire and those who leave it too late are most likely to retire with a pension shortfall. Who are the people who are most likely to retire with a shortfall and who will not know until it is too late? What a surprise—women, I fear.
In Committee, the DWP quoted the cost of providing annual statements as a deterrent—a cost which, none the less, we expect the private sector rightly to bear. I therefore suggest that we consider the “nudge” theory: that if we cannot afford to provide annual, or even five-yearly, individual statements, at the very least DWP sends out periodically a standard letter, in bright bold print, two paragraphs only—I offer a draft— saying for example:
“You are able to draw your state pension at 65. To get a full state pension you need by 65 to have made 35 years of contributions into the National Insurance Fund which pays out your pension. Pension contributions may come from your job or you may be receiving free contributions credited towards your pension if, for example, you have children under 12, you are a carer, you are on universal credit, you are disabled or in other circumstances”.
Paragraph 2 would say:
“You may want to find out how many years contribution you have already built up. If so, please contact us either by phoning us on “x” or online at “y”. If as a result you think you may not have made enough contributions by the time you reach 65, we can send you a leaflet which tells you what steps you can take to build a full pension”.
I offer this template letter to the Government as a possible way forward. One standard letter—a nudge—telling people what they may wish to know, in bold print, going out to everybody at five-yearly intervals from the age of 45. It is a nudge for people to find out where they stand and if necessary to do something about it, to help people to help themselves. Otherwise why bother with a Pensions Bill—one that is more generous and certainly one that I support—if we do not want or seek to encourage people to build a full state pension at the end of it? Why bother? It must make sense to nudge people. I beg to move.
Baroness Turner of Camden (Lab)
I support my noble friend Lady Hollis on this amendment. I am sorry that the noble Lord, Lord McKenzie, is not here to second it, The Government have had a long-term policy—they kept telling us about it at every stage of this Bill—of being in favour of people saving for themselves in addition to having the pensions provided in the Bill. They expect people to save for themselves and they regard the pensions provisions that they are making as a kind of platform from which people can then make savings for themselves.
How are people to save for themselves if they do not have the necessary information about what their entitlement is? The amendment addresses the entitlement to a pension statement and notification of entitlement to a statement. All that is very necessary if people are to make sensible arrangements for their retirement. I am amazed to think that the Government may not accept this amendment. I hope however that they will because it is in line with their own thinking on the Bill. They want people to save. How do they expect people to save if they do not know what their entitlement is? They have an obligation to tell them what it is. Certainly it happens in the private sector; I belong to a private pension scheme and I get a regular statement as to what my entitlements are. Why can that not be the case for people who are receiving state benefits?
Baroness Sherlock (Lab)
My Lords, my noble friend Lady Hollis has raised some significant questions and I look forward to hearing the Minister’s answers. This amendment follows an ultimately rather unsatisfactory discussion we had in Committee during which my noble friends Lord McKenzie and Lady Hollis, along with the noble Baroness, Lady Greengross, and others tried valiantly to get the Minister to explain exactly when somebody would receive a communication from DWP to warn them that the state pension they would get in future would not be the same as what they might have expected. I went back and reread the record. I think the answer we got was that they would get a statement if or when they asked for it and then normally only digitally. The Minister kindly arranged for officials to explain their communications strategy to Peers, and I am genuinely grateful for that. However I think it is fair to say that the exercise did not entirely allay our fears or perhaps fill out all the gaps in our knowledge. I hope the Minister is looking forward to finding a consultancy fee for my noble friend Lady Hollis for her contribution to what will doubtless be the next mailshot from the department.
In Committee I raised comments that had been made during the Select Committee inquiry and elsewhere from quite a wide variety of bodies about this subject. It is worth highlighting a couple. Citizens Advice has been stressing that considerable complexity inevitably remains in the system because of the transitional provisions. It says that,
“a sustained communications programme could improve outcomes, manage expectations, minimise misinformation, promote action on NI contributions, and support personal saving for retirement”.
That last point is one made by my noble friend Lady Turner. The Association of British Insurers had also stressed that adequate communication was essential because it was important that people did not feel unclear about how much they would receive, and it should be clear that they would need to save. That is a crucial drive behind all of these reforms and the Labour reforms that preceded them. People need to understand what they are going to get to make sure they save enough for their retirement.
The Select Committee certainly found that there was a lot of confusion out there. Many people thought that from now everybody would get £144 a week instead of the current state pension. Many people thought that all means-testing would disappear and that if they would have got more than £144 now that they would lose that in future. The committee stressed how important it was that people have full information about their future entitlement.
I reiterate three simple questions which I raised in Committee; they did not get answered at the time but I think the Minister has had an opportunity since then to reflect on them. First, how and when do the Government propose to contact people to tell them of the changes to their entitlement? Secondly, at what point will the Government contact people who have previously requested and received a pension statement to warn them that it may no longer be accurate? Finally, in setting up a communications campaign on this new scheme, what outcomes are the Government seeking and how will they measure them? I look forward to the Minister’s reply.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, the single-tier pension reforms are designed to simplify the current state pension system, to make it easier for people to understand what they will get from the state in retirement. More so than for other reforms, therefore, communication is critical to success, so I certainly share the interest that noble Lords have shown in this issue. Effective communication requires both the right message and the right channel for delivering that message. This forms the basis for our communication strategy to support these reforms, a summary of which I circulated to noble Lords this morning and which will be placed in the Library.
We will deliver a phased approach to our communications, building from Royal Assent towards the implementation of the reforms and beyond. This will allow us to provide accurate and up-to-date information as quickly as possible before we issue more tailored communications through a range of channels to reach all our audience groups.
State pension statements will remain a key communication with future pensioners and will be an important vehicle for helping individuals understand how they are affected by the reforms. The introduction of these reforms gives us the opportunity to radically transform the way we currently provide this statement service. Our ultimate vision is to provide an online system that is integrated with HMRC’s national insurance data, enabling people to access this information at a time to suit them and in a way that allows them to model the impact of gaining further qualifying years.
In Committee I said that we would provide statements that reflect the single-tier rules once we have the new IT in place and individuals’ NI contribution records are complete up to and including the 2015-16 tax year. Prior to April 2016 our plan was to continue to provide statements based on the current rules accompanied by additional information on the single-tier changes to those affected by the reforms. However, we believe there is trade-off in terms of providing information we have available based on current system amounts while trying to minimise the distribution of information that is potentially misleading or simply begs further questions. Noble Lords may wish to note that we are therefore currently reviewing the information we can provide to customers prior to April 2016 to ensure that it is as accurate and helpful as possible. We will make a decision on this by the end of March when we will make our plans more widely known through discussions with our stakeholders and within our broader communication materials.
The noble Baroness, Lady Sherlock, asked when we might contact previous recipients who will be affected by the changes. We will consider this to be part of the process. It is important to note that our data retention rules mean that our statement IT systems hold only a limited number of historic requests going back a maximum of 18 months, and therefore we cannot contact all previous statement recipients. The statements make it clear that the estimates they provide are based on the current rules and may change if individual circumstances alter or the law changes.
Baroness Hollis of Heigham
My Lords, I should like to thank my noble friends Lady Turner and Lady Sherlock for their contributions. I understand that the Minister is as committed as could reasonably be expected to trying to ensure that people are aware of and fully knowledgeable about their entitlements. I accept and absolutely understand that there is considerable virtue in having an evidence-based policy by building it up on the results of research into the most effective lines of communication. I also agree that a variety of responses may be wanted, including press, mailings and online, but I have to say that I would worry if it was largely dependent on online information, given what we know about many people’s recalcitrance over using online facilities as UC is rolled out. It may be that it is a generational thing and that over the next decade to 20 years the recalcitrance begins to disappear, particularly if places such as Norfolk end up actually having access to broadband.
My difficulty is that the Minister has a policy premised on the fact that those who know that they do not know will make the inquiry. The problem is around those who do not know that they do not know, and I am not confident that he has in place a strategy to make them aware of it. In the past, the people who were most vulnerable would have been married women who had been in and out of the labour market according to their caring responsibilities. They had a very straightforward safety net by the fact that they could have 60% of the husband’s pension as a baseline, and only if their own contributions exceeded that, as increasingly they have begun to do, would they draw on their own contributions. That is no longer the case. So the 60% married women’s pension is being withdrawn without, as far as I can see, ensuring that those women know, first, that they are losing what they would have counted on in the past and which is common knowledge, and secondly, what other benefits—or credits, I should say—they may be entitled to claim because that information is not being sent out to them in lieu.
I think that the Minister has a problem here. We are on the same side and I fully accept that he wants to make sure that people are aware of this, but I do not think he really understands what happens when the safety net of the married women’s dependency pension which has existed for 50-odd years is pulled away and women are told that they are on their own. He does not actually know, understand or appreciate what it may be like to find the headspace, resources and capacity to change behaviour in order to build up a pension. I am sure that this is not a gender point, but I really do not think that the Minister understands where women like that may be coming from. In the past, as the Minister will know, we had deficiency notices under NIRS 2. They told you whether you had incomplete NI records. When the computer, on which the Minister is relying so heavily, toppled over in the late 1990s or thereabouts and we could not get it back on its feet for several years, we increasingly lengthened the period during which someone could buy back their NICs or make contributions accordingly to cover the lack of deficiency notices. We were willing to do it then for everybody on an annual basis, as far as I recall, before the computer toppled over, yet the Minister is reluctant to go back to that. I understand the point about mailings and so on, but at the very least I press the Minister to identify in his research the at-risk group. For my money, the at-risk group are women, particularly married women, who had relied on the 60% married women’s pension, who were perhaps unaware in the past of the credits they could have claimed, including carer’s credits, and they are not on the list.
I would like some assurance from the Minister—it could just be a nod if he likes—that the at-risk group in particular can be identified. At 65 or 66, they could find themselves on their own with an incomplete state pension and it is too late to do anything about it because we have failed to keep nudging them. If the Minister could give me that assurance, I would be content.
Lord Freud
I would be very comfortable giving the noble Baroness that assurance. Clearly, a generalised mailing out is exactly what we are concerned about. The evidence is that people will get official-looking letters which they do not look at. We have to find a way of getting to the most vulnerable groups, who may take a Rumsfeldian attitude—they do not know what they do not know—and we have to find a way through that. Therefore, I can give the noble Baroness that assurance. I think we are basically agreed around this Chamber about the need to get the communication right, but we need to do the research. There is no point in us making it up without that knowledge.
Baroness Hollis of Heigham
With those assurances, I am content to withdraw the amendment.
Lord Freud
“( ) Where regulations under section 22(5ZA) of the Contributions and Benefits Act have the effect that a person is credited, on or after 6 April 2016, with earnings or contributions for a tax year starting before that date, the earnings or contributions are to be treated for the purposes of calculating the rate under this paragraph as having been credited before 6 April 2016.”
Lord Freud
My Lords, in Committee, the noble Baroness, Lady Dean, spoke movingly of the case of a service wife. Her husband, a commanding officer, was stationed in Belize. Travelling abroad with him meant she sacrificed a successful legal career in the UK, but she also gave up the ability to build up her state pension. It gives me great pleasure today to be able to present a means to redress this situation. I need to acknowledge, alongside the contributions of the noble Baroness, Lady Dean, those of the noble Lords, Lord McKenzie and Lord Browne, and I particularly thank the noble Baroness, Lady Hollis, for her forensic analysis of this issue and her persistence in seeking a remedy for this group.
This amendment signals our determination to act. It places a duty on the Secretary of State to make regulations to allow service spouses and civil partners, due to reach state pension age from 6 April 2016, to apply for national insurance credits for periods during which they accompanied their partner on a posting outside the UK. The regulations will make provision to allow credits for periods between 1975-76 and 2010. This will ensure that, even in the rare circumstances that someone has spent their entire working life accompanying their spouse abroad, they will still be able to build the 35-year contribution record needed for the full single tier.
This builds on this Government’s commitment, set out in the Armed Forces covenant, to remove disadvantages that the Armed Forces community may face in comparison to other citizens, and to recognise sacrifices made. We continue to work on the finer details of the scheme, which will be set out in regulations. This will include the manner in which applications will need to be made and the precise start date. From information supplied by the Ministry of Defence, we estimate that up to 20,000 individuals could have a higher single tier pension from these credits.
Key to the impact of these amendments will be how effectively they are communicated. We recognise the importance of alerting people to the scheme to maximise take-up, and this will be incorporated into our wider single tier communications strategy. The MoD also anticipates using the ex-service communities’ charitable network and the Service Personnel and Veterans Agency communication channels. This amendment is also grouped with a small number of technical, tidying-up amendments to Schedules 1 and 12. These are all consequential on either Amendment 9 or provisions elsewhere in the Bill.
In summary, those who support our armed services abroad should not be penalised. The prospective earnings credit introduced in 2010 helped to ensure that single- tier pensioners in the circumstances I have discussed could build entitlement to state pension for years after 2010, but not before. These amendments address this and ensure that people who have accompanied their spouse or civil partner on overseas postings are not unjustifiably disadvantaged. I beg to move.
Baroness Hollis of Heigham
I will just say a couple of sentences. I am very pleased indeed that the Government are building on the work of the last Labour Government in recognising the particular obligations that go with the military covenant and ensuring that the spouses of service personnel are not disadvantaged when it comes to a full state pension. I welcome this and am very glad that the department and the Minister have been able to meet the concerns raised in Committee.
Lord Browne of Ladyton (Lab)
My Lords, we welcome the Government’s amendment, which requires the introduction of regulations to provide for spouses and civil partners of service personnel to gain national insurance credits for periods spent on accompanied assignments prior to 2010. As my noble friend has just said, these provisions build on the reforms of the last Labour Government, who allowed credits to begin from 2010. I thank the Minister for the generosity of his remarks about my noble friends Lady Dean and Lord McKenzie and, indeed, his recognition of my own small contribution to this outcome.
However, it would be remiss of me if I did not express from these Benches that we are in no doubt who is entitled to the greater credit for this amendment being tabled. It is my noble friend Lady Hollis who is the heroine of the hour. There is no question that the Government have acted because she raised the issue so effectively in an amendment in Grand Committee. Before she did so—and I am sure that the Minister will confirm this—the Government’s position was an honourable one, but, as expressed on page 33 of the document The Armed Forces Covenant: Today and Tomorrow, they stated:
“At present the Government has no plans to make further adjustments to the tax and benefits system for Service personnel and their families but will keep this issue under review”.
The Minister indicated in Grand Committee that he would review it and his officials have kept us all informed of that review going on and it is to his credit that it has resulted in this outcome.
The Government deserve significant credit for responding in the way they have done and now at least we can say in relation to this issue that there is no disadvantage and that members of the Armed Forces community have access to the same benefits as any other UK citizen. As the Minister has said, the challenge now is to ensure that, of those potential 20,000 beneficiaries, the maximum number benefit from this opportunity. The current figures for applications for the 2010 credits are disappointing. Either the MoD now needs to build a process for credits to be automated, or it needs to improve its engagement with its own personnel, to inform people of the availability of the credits and to facilitate and encourage take-up.
I accept that the other government amendments are consequential and uncontroversial and we welcome them also.
“( ) The weekly rate is not to be increased under subsection (1) if a person has opted to receive a lump sum.
( ) The amount of any lump sum to which a person who has deferred entitlement to a state pension shall be set out in regulations.”
Baroness Hollis of Heigham
My Lords, we move to a new subject: deferred pension and how it may be taken, whether as income or lump sum. Over the past 15 years, most pensioners have for the first time been lifted out of poverty. In 1997 nearly half of pensioners were below the poverty line. It is now about one in seven: 14%, compared to nearly 50%. Pensions have risen three times faster than earnings, pension credit has topped up their income and now, we are pleased to say, pensioners are no more likely to be poor than any other group in society.
With pension credit for most future pensioners being absorbed into the new, more generous state pension, together with the guarantee of the triple lock, that journey out of poverty continues. Pensioners’ incomes, especially for those with no occupational pension, will be stronger and more stable than ever before. It is good news and I am delighted. I congratulate the Government on it, I really do.
We know, in any case, that most pensioners are very careful and spend up to their income and no more. They cope and they avoid debt like the devil. However, the growing problem is that those pensioners dependent on the state system, who may in future have a more adequate state pension, are also less and less likely to go into retirement with some modest savings as a cushion against rainy days or as a resource to meet lumpy expenditure. Currently, 21% of pensioners—one in five—have no savings whatever; 37%, more than a third, have less than £3,000 in savings; and half have less than £8,000. If the Minister gives us any mean averages, they are frankly a waste of time, as they were in a previous debate about hours.
Pensioners face soaring quarterly energy bills—I imagine other noble Lords, like me, have been slightly shocked in the past week or two to receive an energy bill rather larger than anticipated. The roof may need substantial work, especially after the gales, and may not be fully covered by insurance. Washing machines and boilers pack up. If they live in rural Norfolk, they may need to replace their old car with another, otherwise they are effectively housebound. They may have an outstanding mortgage and want to pay it off. What do the one in five who have no savings at all do when they are hit by a large utility bill? What do the more than one in three who have savings of less than £3,000 do when one of them dies and they face funeral bills?
We have, understandably, concentrated on building up pensioners’ incomes, and rightly so. However, we have largely ignored the issue of accessible pensioner savings for those of modest income. You can always turn capital into income—you just draw it down as you need it for that energy bill—but it is very hard to suddenly find £400 or more to pay the winter quarter energy bill from state pension income alone if you have no savings on which to draw. In other words, pensioners need savings, just as we all do, and too often they do not have any.
We recognised this when we did the deal with what was then Age Concern as we introduced pension credit in, I think, about 2002. The first £10,000 of savings would be disregarded for pension credit, although thereafter there was a high notional tariff rate. We recognised this need for savings when my noble friend Lord McKenzie made means-testing far more light-touch as pensioners became older. That is why, incidentally, I am seriously bothered about the new class 3A contributions, which encourage pensioners to use up capital to buy a year of S2P, taking an unwise gamble on their life expectancy, increasing their income by a bit but heavily reducing their capital. That is very unwise.
Above all, we recognised this when, back in 2005, we allowed pensioners who had deferred drawing their state pension to take that saved-up pension either as an income addition to their future pension—which is what most did—or as a lump sum to give them some savings. The Government propose to abolish the choice of taking that saved-up pension as a lump sum; it will be available to people only as an addition to the state pension. They are removing the choice of a savings sum from future pensioners. Currently, of the 1.2 million who defer their pensions, 63,000 take the lump sum, which was, on average, just under £14,000. In future, that option will be scrapped. Why? The Minister for Pensions, Steve Webb, is absolutely clear that he is doing it to “simplify the system”. It is not about costs at all, he says, just about simplicity. What is so difficult to understand about a lump sum of your two years or so deferred pension? It is complex, the Minister says, because DWP needs a 64-page leaflet to explain the choice. The Minister in your Lordships’ House, the noble Lord, Lord Freud, says the same.
As the Minister would expect, I have that 64-page leaflet. It is well written—well done to the DWP—simple to understand and straightforward. I have worked through it. I calculate that if, in the name of simplicity, you removed the choice of a lump sum and allowed only an increase in the pension, you would remove precisely 11 pages in total—I will give him the references if he wishes—so that the 64 pages would come down to 53. The rest of the pamphlet would remain unchanged apart from occasionally deleting the words “or lump sum” from, for example: what happens when I die, if I get divorced or if I am widowed; can I combine them; what if I live abroad; what are the effects on my benefits or on my tax; where can I find out more; what organisations may help me; and so on. That is what the 53 pages are largely about. All that applies to any deferred state pension, whether it is taken as an increment or as a lump sum—the argument of simplicity does not wash at all. It is a complete myth, and if anybody worked through that pamphlet, they would see it for themselves. I am confident that the Minister has worked through that pamphlet and I am therefore confident that he will agree with my assertion that it removes only 11 pages out of 64 in the name of simplicity, thus denying choice to people who want to exercise that choice. Taking out that choice in the name of alleged simplicity is, frankly, laughable—it is absurd. I have never seen such a trivial justification. It takes 11 out of 64 pages and thereby denies the choice of a savings lump sum to 65,000 people. I presume the Minister thinks people can understand 53 pages but that 64 pages is just too much. Really? Because he thinks, without any evidence, that they cannot manage those extra 11 pages, he will take the decision out of their hands and make it himself. He knows better than pensioners what they should do with their money. He cannot trust people who have been working and scrimping for 50 years not to waste any savings—their money—that they may accrue.
Mind you, if you have a private occupational pension and get a 25% lump sum tax-free, that is fine. You can do what you want with it. If you simply defer your S2P element, your additional pension, for two years you can take that as a lump sum. The Minister will not tell you how to spend that either. However, on a state pension, he is taking away the possibility of a lump sum—your money—that you have saved for, because, frankly, he does not trust you with it and is calling it simplicity if he takes 11 pages out of a 64-page pamphlet.
Some people, after two years’ deferral, may want that £14,000 of their money rather than the alternative of £14 a week. I would. They would be better off taking the £14 per week instead of a lump sum only if they live, I calculate, a further 20 years until they are aged 87. Those without savings are also poorer and least likely even to reach 80, let alone 87. Who are we talking about? They may be husbands working longer until their younger wife also reaches state pension age. They may both work longer, and one takes the income and the other the lump sum. They may have a somewhat impaired life expectancy; perhaps one is a smoker and they want the lump sum up front just in case that person does not survive to 87. The unspent portion of the lump sum can be inherited by the surviving spouse and would help cushion her—but if taken as increased income it dies with him.
We rightly spend hours trying to encourage people of working age to work longer. We rightly spend hours trying to get them to save. We know we need to build a savings culture. In a low-paid job, perhaps the only way they may be able to build savings is to defer their state pensions for a year or two, work a bit longer and take it as a lump sum. That may subsequently save them needing to get loans at huge interest rates because they have a lumpy bill, perhaps an energy bill, to meet. It allows them to make choices, which each one of us in this House takes for granted. Having just that extra margin in savings means that they can decide to help a grandchild, buy a washing machine that works, replace the carpet, celebrate a golden wedding anniversary, turn up the heating when it freezes or give a donation to their local church. They cannot do that out of income. They need savings. It is their choice, not ours. Pensioners, as they enter pension age, are moral adults and we should respect that and respect them. They have earned the right to that choice and we—and the Government—have absolutely no right at all to take that choice away. I beg to move.
Baroness Sherlock
My Lords, although we gave this a fairly good airing in Committee, I confess that I do not yet feel that I properly understand the nature of the Government’s objections to the taking of lump sums. My noble friend Lady Hollis explained her case for this, and there is no doubt that we have a crisis of savings in this country. Too many people do not have a safety net for a rainy day, and British households generally do not have enough money in savings. That amount has been falling in recent years—unsurprisingly, given the pressures on the cost of living. The case made by my noble friend about why people might need access to a lump sum deserves an answer from the Minister. She described when and why the option was introduced and what people might use it for.
However, having gone carefully over the record and the correspondence since, I did not get answers to some of the questions which I put to the Minister in Committee. Those answers would help me because I would like to understand two things. First, are the Government confident that they have worked through who will be affected by this, what the impact will be and what the alternatives are? Secondly, can they explain clearly why they are doing it? On the first point—and I did ask this—we know that 75% of those who are deferring are women, but do we know why?
My noble friend suggested in Committee that those people are waiting until their partner retires to claim their pensions. Have the Government been able to confirm whether that is why they are deferring, or are they deferring because they are still working and have not saved enough to feel able to retire? What do we know about the wealth of those who are deferring their pensions? These questions matter because they would go to the points made by my noble friend Lady Hollis about whether people without savings are going to end up accessing other forms of credit, which we would not want them to do as they may be problematic.
Most of all, I would like to understand what the Government’s objection is. We have had a few arguments made: the argument of simplicity was made and has been pretty well dispatched, so I will not revisit it. Another argument raised was that significant numbers of people deferring and claiming a lump sum are living overseas. However, we know from the data given to us that more than three-quarters of those people are living in the UK, so that is probably not the issue. Is it the administrative burden? Perhaps the Minister could tell us whether it is that or simply the cost.
If it is the cost, I understand that. If the Government’s argument is that the costs are significant, the House, I am sure, will listen carefully. However, it would be helpful at this point if the Minister could simply come out and say whether he would like to do this but cannot afford it or whether the Government think for some reason that it is a bad idea, in which case my noble friend Lady Hollis has laid down a strong challenge which the Minister really should answer.
Lord Freud
My Lords, in designing the single-tier reforms our overriding aim has been to deliver a flat-rate pension above the basic level of the means test without increasing spending, and to do so in a way that recognises people’s contributions under the current system. This is not easy to do and it involves difficult trade-offs. Some elements of the transition necessarily generate costs in the early years, particularly the “better of” calculation, which means that people with low amounts of additional state pension, such as carers, receive a boost. There is also the fact that those with high amounts of additional state pension, which take them over the full amount of the single-tier pension, are able to keep the surplus as a protected payment. Nevertheless, we have been able to stay within 1% of projected expenditure until 2040, which is fair to current pensioners and to future taxpayers.
In answer to the blunt question of the noble Baroness, Lady Sherlock, removal of the lump sum option for those who defer their state pension has played a key role in flattening expenditure. The early-year savings that this delivers have been ploughed back into the single-tier design. We are, however, still keen to preserve some flexibility for single-tier pensioners who, by choice or accident, claim after they reach state pension age, so people will still be able to build up an increase to their state pension that is paid on top of their single-tier entitlement for the rest of their lives. As discussed in Grand Committee, there remains the option of backdating a claim for a single-tier pension. By backdating their claim to a state pension, someone who has delayed claiming for whatever reason—either unintentionally or as part of a planned retirement—will be able to get up to 12 months’ arrears when they make their claim for a pension. This would provide someone who has qualified for the maximum weekly amount of £144 with arrears of almost £7,500 at 2012-13 prices.
Baroness Hollis of Heigham
Can the Minister help me with a technical point? With arrears, is the assumption that interest will be paid on the deferred money?
Lord Freud
What happens is that the amount is repegged to the year in which it is taken. If, for instance, someone’s delay in claiming exceeded a year, they would get an increment on top of the single-tier entitlement.
Baroness Hollis of Heigham
I am sorry but I still do not understand. This is a very simple point. At the end of the year in which you have not drawn your pension, do you get the equivalent of a return on capital—in other words, an interest payment—over and beyond the direct addition of 12 months of state pension?
Lord Freud
No, you do not get interest on arrears, but let me take the example of someone who delays claiming the maximum amount for two years and wants to backdate their claim for the 12 months. If we take the £144 example, they would get an increment of around £7.50 to £8 a week, depending on the value of the uprating, which would be added to their weekly entitlement. It would also include the calculation of arrears due to them for the backdated period. That would boost the overall arrears payment to more than £8,000, so that is the mechanism through which the delay works.
On the question from the noble Baroness, Lady Sherlock, about why women in particular are deferring, one of the main reasons is that women have a lower state pension age than men, although of course the reasons will vary with individual circumstances. I am loath to go too deeply into the simplicity argument because we will have a row which will go on for ever. However, to conflate complexity with the number of extra pages in a particular pamphlet is, bluntly, a somewhat bizarre argument. The difficulty for individuals is in making the decision on what option is best for them in the longer term and what is best for their surviving spouse.
Lord Freud
I must confess that I have not counted up the pages or gone through it in detail. I suspect that I have gone through it but I cannot remember it and have not done the counting job on pages that clearly I should have. I knew that I should not have said this. However, I am not going to back down and I will stay with my “bizarre” comment.
Baroness Hollis of Heigham
Is this evidence-based policy? The Minister has not read it but it is “bizarre”.
Lord Freud
My Lords, I am most grateful for having a superb staff, some of whom have not only read the document but written it, so I am confident in the statement that I have just made.
The removal of the lump sum is not because we do not trust people; in fact, it is quite the opposite. We believe that people can make savings decisions for themselves. If they can afford not to claim the state pension, they can choose to save it.
Let me go to the figures on pensioner capital. We do not recognise the figures quoted by the noble Baroness. The figures I can quote—which are not averages, which I know the noble Baroness would scorn—are that almost three-quarters of the pensioner population already have more than £5,000 in capital, and more than half of all pensioners have more than £12,500 in net wealth.
Baroness Hollis of Heigham
The Minister challenges my figures. Is that households or individual pensioners?
Lord Freud
I am not sure why that was the point precisely, but those are the figures I have. The proposed amendment would allow for regulations to introduce a lump-sum payment into the new scheme. That would bring costs forward and would undermine the cost neutrality of the single-tier package, as well as the simplification.
Bringing costs forward may sound like a technical concern, but the timing of expenditure is vital. Without making offsetting savings elsewhere in the single-tier package, Governments in the early years of single tier would be forced to divert more spending towards the state pension system than under the current scheme, which means more government borrowing for future generations to shoulder, or less to spend on today’s priorities. We simply do not believe it is right to make this trade-off to enhance the personal financial management options for a relatively small group of people who do not need to draw the income from their state pension and are therefore able to exercise their option to defer.
We understand that a one-off payment can help people build up capital, and the backdating option can provide flexibility in this respect. However, we question whether there is a widespread problem of low capital for those in retirement. Introducing a lump sum would require us to make alternative savings from elsewhere in the single-tier package, most likely by reducing coverage. We simply cannot agree to that, and so I urge the noble Baroness to withdraw her amendment.
Baroness Hollis of Heigham
My Lords, that was a very interesting reply. I only wish we were in Committee so we could show up more of the thinness of the Minister’s reply. For somebody who is so evidence-based—which is something I greatly respect about the Minister—he was dismissing it rather wildly out of hand.
The Minister pushed the argument that this is about cost and said that this removal played a key role in “containing expenditure”. That is very interesting. I had a discussion with his right honourable friend something like three weeks ago on precisely this point. He assured me most emphatically and vigorously—I am sure he would confirm the conversation, and there were witnesses—that this had nothing to do with cost but was only about simplicity. May I at least suggest that the Minister talks to his right honourable friend and agrees a common line on this? At the moment, one says it is all about cost and the other says it is nothing to do with cost but is all about simplicity. I suspect that the Minister in our House is probably correct about the cost argument, but that is not the position presented by the Minister responsible for pensions, who assured me emphatically to the contrary.
As to the point about simplicity, frankly, it is absurd. I checked my pages again. Pages 11 to 17 are a table showing the cost value of a lump sum compared with increments, and pages 26 to 29 are on taxing the lump sum. That makes 11 pages in total, and probably only three of those, on taxing the lump sum, would be regarded as any form of challenge beyond a reading age of seven and a quarter—so the Minister’s argument about simplicity is frankly absurd, patronising, condescending, lacking evidence and without any factual basis whatever. Frankly, we expect rather better from the Minister.
As for pensioner savings, as I suspected, the difference between us is that my figures are based on individuals, and I stand by them, and his figures are based on households, which does not help the argument very much. He seems to think that 64,000 people denied a lump sum is such a small number that we do not need to bother about them. It is three times the number of service spouses, if I remember correctly, that he is going to help through the military covenant, and no one said they were too small a number to bother about—yet the figure for a lump sum possibility which is three times larger is too trivial to be worth troubling ourselves with.
Frankly, I do not think the Minister believes a word of his argument. I think he does believe his argument about cost, but I do not think he believes anything else about it. He knows and understands that pensioners need savings. He knows that this may be a way for those who take this lump sum to exercise that choice. He knows that it is not difficult to understand. It could not be simpler. Do you want to take this two years’ worth of pension as a lump sum or do you want to add it on? If you are taking away the increment, that would be complicated to explain. A lump sum is the easier and simpler of the two options, and that is the one the Minister is taking away, to the pain of the individual who I calculate will reach their cross-over point—I asked the Minister for this figure, but it has never come to me—at about 87: I stand to be corrected if the Minister thinks I am wrong.
We are left with backdating—fine. All I can hope, and I am sure others do as well, is that we will keep up the pressure on Ministers to ensure that people are aware that they can take their pension lump sum in arrears, as a form of saving, after 12 months and get £7,500 or £8,000 for that sum, which will still keep them below any risk that other benefits, if they are necessary, including housing benefit, will be lost.
I am disappointed by the Minister’s reply, and I think that the Minister is disappointed by the Minister’s reply. He knows that it does not stand up to a scrap of scrutiny—not one scrap—but there is nothing much we are going to do about it at this time of night, so I beg leave to withdraw the amendment.
UK National Action Plan on Women, Peace and Security
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Prosser
To ask Her Majesty’s Government what progress they have made on the development of the UK National Action Plan on Women, Peace and Security.
Baroness Prosser (Lab)
My Lords, it is with great pleasure that I stand to introduce this Question for Short Debate on women, peace and security, but not because the subject is a pleasing one. No, I am pleased because the more we debate these matters, the more we place our commitments and concerns on the record, the more likely it is that women in areas of conflict, who desperately need our voices and our support, will grow in confidence themselves and will feel stronger and more able to fight off the degradations and humiliations all too frequently suffered.
I can also express my pleasure at the work currently being done by our Government. The UK leads on the women, peace and security agenda in the UN Security Council, which is a very practical demonstration of commitment to this issue. During the period of our leadership two further Security Council resolutions have been agreed. Security Council Resolution 2106 notes that rape and other forms of sexual violence in armed conflict are war crimes and calls upon member states to comply with their obligations by investigating and prosecuting those who are subject to their jurisdiction who are responsible for such crimes. Further, the resolution recognises the need for accurate information and monitoring and, importantly, calls for further deployment of women protection advisers. A second resolution, UN Security Council Resolution 2122, unanimously agreed in October 2013, looks at the UN’s own responsibilities by, for example, strengthening the Security Council’s commitment to deliver this agenda by ensuring UN departments provide effective reporting and increase women’s participation in conflict resolution and peacebuilding processes. It also reiterates the Security Council’s decision to hold a high-level review of UNSCR 1325 in 2015.
I am also particularly pleased by the Government’s commitment to the elimination of rape as a weapon of war, as demonstrated by the Preventing Sexual Violence Initiative. In November 2013, when announcing the global PSVI summit, William Hague said:
“We intend it to be the largest summit ever staged on this issue. We want to bring the world to a point of no return, creating irreversible momentum towards ending warzone rape and sexual violence worldwide”.
These are, indeed, welcome words.
We welcome the positive moves taking place which we are all pleased about and which give us confidence on behalf of our sisters around the world. Now here comes the “but”. With any such complicated initiative with far-reaching implications, both across and between Governments, nationally and globally, there will always be room for improvement, both by better co-ordination and clearer resourcing. This is, therefore, a two-stage process with immediate and longer-term objectives. The need to focus, in the first instance, on keeping women and girls safe is absolutely understood. However, this is a problem based on power and women and girls will not be safe while they remain powerless. Plans which build on women’s involvement and participation in the decision-making processes in their neighbourhoods, regions and countries will contribute towards shifting the power away from men and towards women and will help to bring about the cultural shifts which are so badly needed.
The national action plan and the review document published in October 2013 both recognise this argument and there is government commitment to putting women’s participation at the heart of the new national action plan. What is meant by participation? I would argue that participation must be seen in its deepest and widest sense: at local, regional and national level; in policy development around access to education, healthcare, employment, finance, et cetera; in the drafting of relevant legislation; in constitutional change and in access to democratic processes which enable women to become involved in all levels of public life. I am not always a fan of quota systems but they can kick-start a change to traditionally biased bodies and the need for the presence of women throughout society is so great that quotas would be essential. Will the Minister confirm that Her Majesty’s Government’s negotiation and mediation teams will be at least 30% female, in line with agreed best practice guidelines?
We also need to see meaningful and robust consultation with in-country women’s organisations. That way, national action plans can best be developed and implemented and progress monitored to ensure the delivery of the NAP objectives. This work must also ensure that women’s NGOs are invited to participate in official meetings, particularly when those meetings are attended by Ministers or other decision-makers, where local voices can well make the decisions taken more relevant and more easily implemented. Involvement of local women’s organisations also informs and guides priorities; changes to so-called social norms can best be led by these organisations. Continued efforts need to be made to build on the in-country workshops which so helpfully informed the 2012 national action plan review and which should set the template for the development of the 2014-17 national action plan.
Turning to the question of funding, there needs to be the political will to allocate ring-fenced resources for this particular work, and there needs to be exemplar interdepartmental co-operation to make sure we get the biggest bang for our buck. Although significant sums have been allocated to various programmes, some run by DfID, some by the FCO and others through the MoD, there have never been any dedicated or ring-fenced moneys allocated to the national action plan. This can cause uncertainty and can also lead to a less than strategic approach. For example, women, peace and security criteria have been included in Strengthening Alliances and Partnerships within the Conflict Pool as part of the Building Stability Overseas strategy but it does not ring-fence funding for thematic priorities such as women, peace and security. Also, the Conflict Pool does not have a centrally driven approach and, although local influences are invaluable, an overarching strategy must surely be key to achieving the best delivery outcomes. With this in mind, how will DfID, the MoD and the FCO be sure that posts are implementing projects and that they are aligned to the principles of the NAP?
In summary, much good work has been and is being done. I have tried to capture the need to shift our emphasis away from dealing with the results of powerlessness towards enabling women to drive the agenda by knowledge, education, participation and influence. We need to ensure that the funding strategy enables local decision-making which fits into the overall strategy of the national action plan and that all departments involved in this project are taking an integrated approach. Successful outcomes will change women’s lives and, in turn, will provide security to the lives of all in areas that for so long have suffered conflict and a lack of security.
Lord Wallace of Saltaire (LD)
My Lords, this is a rather tightly timed debate and the right reverend Prelate the Bishop of Wakefield has asked if he might speak in the gap. It would, therefore, be a help if all noble Lords could complete their speeches well before “6” comes up on the clock.
Baroness Jenkin of Kennington (Con)
My Lords, having flown overnight from a different time zone, I was rather tempted to scratch from today’s debate and I now feel a bit guilty that I did not. However, as I was just discussing with the noble Baroness, Lady Prosser, in the Prince’s Chamber, these matters are so crucial that, although we seem to debate them regularly, it is important for the rest of the world to know how much we in this Chamber care and worry about our sisters across the world. I am grateful for the opportunity to participate in this debate and thank the noble Baroness for so ably introducing it.
I will start by going back to basics with a reminder of what the NAP actually is. The UK national action plan provides a framework to ensure that the provisions of UNSCR 1325 and associated resolutions are incorporated into the Government’s work on violent conflict. The creation of a new UK cross-government plan provides an opportunity to outline how UNSCR 1325 can be integrated into wider defence, diplomacy and development measures, and adopted in armed conflict and post-conflict situations. It helps the Government to identify priorities, determine responsibilities and develop measurements against which progress can be measured at the national level.
Why do we need such a plan? The horrendous impact of conflict on women around the world has long been underestimated and, in many cases, brushed under the carpet. More than half of armed conflicts reignite within a decade of peace. At the heart of this problem lie flawed peacebuilding efforts which have often excluded 50% of the affected population: women. Over the past 50 years, the nature of conflict has changed; almost all modern conflicts are intra-state, although external dynamics still influence conflict realities. This means that it is more dangerous than ever to be a civilian in today’s conflicts.
As wars shift from the battlefields to communities, civilians now suffer more than ever. In World War I, approximately 10% of all deaths were of non-combatants; in Iraq, since 2003, civilians account for around 90% of all fatalities. These changes have impacted enormously on women and modern peacebuilding and security agendas must address this challenge. As Major General Patrick Cammaert—I hope I have pronounced that correctly—former military adviser to the UN Secretary-General, famously stated:
“It is now more dangerous to be a woman than to be a soldier in modern conflict”.
I do not suppose I will be the only person using that quote today. It is time for the UK and the international community to recognise this and move forward to an era where women are free from impunity. The UN Security Council’s renewed determination to bring women into the centre of all efforts to resolve conflict and promote peace is to be welcomed. The goal is not merely to ensure that women have seats at the table of all conflict resolutions, but also to ensure that communities and societies as a whole can benefit from their expertise and knowledge.
I welcome and acknowledge the UK Government’s commitment to this issue, particularly the Foreign Secretary’s passion to achieve greater justice for women and girls. As he said at the launch of the “No Women, No Peace” campaign, no lasting peace can be achieved after conflict unless the needs of women are met. This means not only justice for the victims of crimes of war, but their active involvement in creating a society in which their rights are respected and their voices are heard.
In the short time available I am sure that others will speak in detail about the importance of June’s conference, where the updated NAP will be launched. I look forward to hearing from others with expertise on the subject.
Credit is also due to Ban Ki-moon for leading the way. He confirmed at the end of last year that women must be involved at every stage of efforts to reassert the rule of law and to rebuild societies through transitional justice.
“Their needs for security and justice must be addressed. Their voices must be heard. Their rights must be protected”,
he said, urging the council to deal with the full range of women’s rights violations during conflict. He is leading by example by appointing more women to senior positions throughout the UN. For the first time in history, five UN peacekeeping operations are led by women: in South Sudan, Liberia, Cyprus, Haiti and Côte d’Ivoire. He has also appointed the UN’s first woman lead mediator in a peace process: Mary Robinson, the UN special envoy for the Great Lakes region of Africa.
While that is much to be welcomed, it is important to look beyond the top leadership positions. We need to examine where women are in the overall architecture of peacekeeping missions. Those in middle-ranking positions are just as critical because they are the ones who directly interact with the local populations who are directly affected by the conflicts.
I am going to cut most of the rest of this so as to give the right reverend Prelate a fair whack. I will say only that the only way to combat the dire threat to women across the world is to include them in peace processes. Without their input, no peace will ever be lasting.
Baroness Falkner of Margravine (LD)
My Lords, I thank the noble Baroness, Lady Prosser, for securing this debate. I declare an interest as vice-chair of the All-Party Group on UN Women. In doing so, I immediately seek an assurance from my noble friend as to whether the All-Party Group on UN Women will be involved in the London conference in June 2014.
This has been a proactive Government in pursuing this agenda. Looking back over the 14-year period, the past three have probably been the most proactive that we have seen, the credit for which must of course go to the Foreign Secretary, who has taken such a personal stand and has championed this; and to my honourable friend in the other place, the ministerial champion for tackling violence against women overseas, Lynne Featherstone.
There has been a great deal of progress. We achieved a declaration on the issue for the first time at the G8 last year. Also last year, we had an inclusion in the Commonwealth Heads of Government Meeting communiqué. I know well how difficult it is to get the 54 countries of the Commonwealth to come to any sort of consensus, so that was really quite a remarkable achievement. Nevertheless, these fine steps along the road of progress have not necessarily been followed by much action. I will give my noble friend some evidence for this.
Of the core group of the G8 member states, a significant one, involved in ongoing conflicts in the Caucasus, is Russia, which has not adopted a national action plan. In the Commonwealth, the evidence leads to even greater pessimism. Of the 54 countries of the Commonwealth, only eight have adopted national action plans to date. Three were among the old Commonwealth—Australia, Canada and the United Kingdom—so I think that one would expect that. However, the five remaining nations, of the new Commonwealth—Ghana, Nigeria, Rwanda, Sierra Leone and Uganda—which signed up to these norms represent a counsel of despair. We know well that countries of the new Commonwealth, predominantly in Africa and south Asia, have very poor records of violence against women. Yes, we have come far but we still have a long way to go.
Particularly instructive about the absence of sign-up to national action plans is south Asia, as a region. Of the five countries in south Asia, four—India, Pakistan, Bangladesh and Sri Lanka—have persistent, ongoing and long conflicts, yet not a single one of them has signed up to their commitments in this regard. Moreover, not a single country in the Middle East or north African region has signed up: not one Arab state is represented in the list of 43 countries that have developed national action plans. We might have made some progress, but we have done so within what I would describe as the “usual suspects”, rather than among those where the need is greatest. Looking at the extent of conflict in the Middle East now, our failure to achieve any progress there is significant. I ask my noble friend whether Her Majesty’s Government will now—having got this far, through its leverage as a UN Security Council member, its role in funding UN Women as extensively as it does and having such a fantastic Conflict Pool—contemplate some form of conditionality in the aid and assistance they give to some of these countries, to pressure and leverage them to move forward and to prioritise action against violence against women.
Finally, I turn to the role of civil society and cross-learning, upon which both the UN Secretary-General in his report and, indeed, we, have put quite a lot of emphasis. It is not clear to me how much of our funding supports cross-learning. As an example, I draw the House’s attention to a Zambian programme supported by Oxfam, called “I Care About Her”. The programme is an illustration of where they have given up on trying to educate men through the conventional methodologies—the church, educational programmes, leaflets and so on—and have decided to educate men in a rather different way: by asking them which women were important in their lives. The answer came back quite clearly that men in Zambia considered mothers, sisters and daughters to be the important women in their lives, not their wives. The greater extent of the violence against women was against wives. The re-education focused on showing that the women who were the subjects of violence were somebody else’s mother, daughter or sister. It has been a hugely successful programme, and Oxfam should be commended for it. I hope my noble friend will be able to tell us if they are funding cross-learning of that sort from one country to another.
In conclusion, I very much welcome this new United Kingdom national action plan which is to be developed and implemented through 2014 to 2017. While achieving a great deal across our own Whitehall departmental functions, the UK should also use its lead to influence, to cajole and, if necessary, to push this issue across other parts of the world. That will be the demonstration of its leadership.
Baroness Hodgson of Abinger (Con)
My Lords, I thank the noble Baroness, Lady Prosser, for securing this debate. I know that she has a long history of support for UN Security Council Resolution 1325. I am glad that in this debate we have the opportunity to highlight the important issues while Her Majesty’s Government are in the process of developing the next UK national action plan. I declare my interests as the chair of the advisory board of GAPS and a member of the steering board of the Foreign Secretary’s PSVI initiative.
The UK is a world leader in setting the women, peace and security agenda and played a crucial role in ensuring that UNSCR 1325 ever came into being. This resolution addresses both the impact of conflict on women, and the vital role that women do and should play in conflict prevention, conflict resolution and sustainable peace. This includes women’s role in preventing conflict, preventing violence against women, protection of women, and women’s social, economic and political participation. The new UK NAP provides a key opportunity for the UK to commit to an ambitious plan to take this forward.
Women’s participation in peace processes is a key element of UNSCR 1325, yet almost 14 years after its adoption there is still little progress in this area. Over the past 25 years only one in 40 peace signatories has been a woman, and only 12 out of 585 peace accords have referred to women’s needs. Therefore, I pay enormous tribute to our Foreign Secretary for speaking out so strongly about including Syrian women at the Geneva II peace process and his groundbreaking work through the Preventing Sexual Violence Initiative that is making a huge impact with leaders around the world.
The next two years are key for women, peace and security both domestically and internationally, with the preventing sexual violence summit in June, the NATO summit in September, international drawdown of NATO troops from Afghanistan, the post-2015 framework, and the 15th anniversary of UN Resolution 1325 in October 2015. This new NAP gives an excellent opportunity for Her Majesty’s Government to consolidate and bring their women, peace and security agenda under one framework, maximising opportunities to ensure that women are at the heart of conflict prevention, peacebuilding and recovery.
Domestically, government co-ordination is central to enable the UK to meet its international women, peace and security commitments. To guarantee consistency of policy, the Government need a more joined-up approach to ensuring that all departmental policies and initiatives stem from the NAP, including policies relating to violence against women and girls, the PSVI and DfID’s call to action on violence against women and girls in emergencies.
Stronger mechanisms to mainstream gender and women, peace and security internally within departments need to be established, and gender training needs to be mandatory for some jobs in the UK and overseas. The Ministry of Defence has not yet developed distinct policies and training in line with UN Resolution 1325, and when the UK trains other national armed forces, all training should include women, peace and security. The PSVI summit in June will provide a good opportunity for the MoD to announce developments in this area, and for it to display its commitment to the women, peace and security agenda and preventing sexual violence on a global stage. At a country level, commitments to women, peace and security need to be reflected in FCO country business plans and DfID operational plans, and those commitments should be outlined in the new NAP.
As has already been mentioned, there is concern that the NAP has no dedicated funding. Neither do the Government currently use any systems to monitor their funding on this. For example, we know that the UK has women, peace and security programmes in many conflict-affected countries but we do not know how the UK prioritises this in its funding, and the use of the OECD gender marker would enable this.
As has already been mentioned, in-country consultation through talking to women and girls at grass roots is essential to ensure that the UK’s NAP and women, peace and security priorities reflect the needs of women and girls in conflict-affected and fragile environments. The new NAP should contain a plan for ongoing consultations in its focus countries. Most importantly, the NAP should acknowledge the role of local women’s rights organisations in prevention of conflict and violence against women, and their contribution to peacebuilding. Thus the NAP should commit to ensuring women’s civil society organisations have access to necessary funding including for campaigning and advocacy. This will transform their role and status so that they can fully participate in their community and national peacebuilding.
Monitoring and evaluation of the NAP is also important and the new NAP indicators should demonstrate impact, rather than just output, to enable identification of where its programming, systems and policies are effective, and where changes are required. The annual NAP report to Parliament is key and I hope that my noble friend the Minister can confirm that this will continue under the new NAP.
I am pleased to understand that Afghanistan remains a focus country, as women’s rights there was one of the reasons for our engagement, and we must not allow the gains that have been made for women there to roll back. The NAP provides an opportunity for the Government to demonstrate commitment to women’s rights in Afghanistan and support to Afghan women who so desperately need it. It is also essential that women from Afghanistan are included in the NATO summit in September so that their views are heard and that security for women in Afghanistan is not forgotten as NATO withdraws.
In conclusion, I congratulate the Government on all that they are doing on the women, peace and security agenda. This NAP is an excellent opportunity to push forward this work and to demonstrate the UK’s strong commitment, through funding programmes and ways of working, to ensure women truly are at the heart of conflict prevention, peacebuilding and recovery.
Baroness Kinnock of Holyhead (Lab)
My Lords, there is actually currently no dedicated funding for the NAP. The UN Secretary-General has called for 15% of peacebuilding funding to be allocated to women, peace and security. However, when the NAP was discussed in the other place, the Minister, Mark Simmonds, refused to make such a commitment, saying that the Government do not want to be restricted to any percentage amount. In view of this, will the Minister tell the House how we can be confident that women, peace and security is integrated into all funding in conflict-affected countries, and how funding is likely to be monitored, such as through a gender marker? Further, could we have clarification on whether the conflict, stability and security fund will include a focus on women, peace and security? Can we have an assurance that women’s protection and participation and the prevention of violence against women and girls will ensure that women, peace and security is a priority for the fund?
On leadership and participation, UN Resolution 1325 makes it very clear that there must be women’s participation and leadership in domestic and international peace, security and justice issues. The facts are, however, that since 2010 only one in five ambassadors has been a woman; there has been very little representation of women in leadership positions in the Armed Forces and MoD; and there are no women as chairs or deputy chairs of the Cabinet committee. Against that rather discouraging background, how does the Minister consider that in the new NAP the issue of women’s leadership in the UK will be addressed? In addition, how will we fulfil commitments made to UN Resolution 1325? Women’s participation must feature as a priority across diplomatic, military and development policy and programmes, and must include women at grass-roots level. We need an assurance that this approach will be rigorously pursued. We need to know what has been done to incorporate women, peace and security and UN Resolution 1325 into the MoD. It seems to me that specific and dedicated women, peace and security doctrine, including training for armed forces and staff, should be incorporated into training of other national forces. I hope that we will, this evening, have a reassurance that this will be a commitment under the new NAP.
On co-ordination, I remain concerned that we need, under the new NAP, to see all the WPS initiatives, including DfID’s various activities and the Preventing Sexual Violence Initiative, brought together under a broader women, peace and security agenda rather than being distinct policies led by different government departments. It would surely also be an improvement if the precise roles of the violence against women and girls champion, Lynne Featherstone in DfID, and the FCO lead on the NAP, Mark Simmonds MP, were to be included in the NAP, including the funding attached to each post. This would surely improve co-ordination between departments and bring some much-needed coherence to the process.
Addressing the root causes of violence against women and girls obviously has to be an essential element of efforts to build peace and stability. Is not it essential now to focus on those root causes—namely, gender inequality and discriminatory social norms?
I remain concerned about the murder and abuse of Afghan women human rights defenders and seek an assurance from the Minister that the recent high-profile killings are being raised forcefully with the authorities and that these brave women are being protected. In March last year, the DfID Secretary of State made violence against women and girls in Afghanistan a strategic priority. As we know, since then, things have become considerably worse for Afghan women and their rights. Eleven months after the statement, the Secretary of State is yet to announce what this priority will look like and how it compares with the financial commitment made to the other two strategic priorities for Afghanistan. Can the Minister therefore confirm that violence against women and girls will be a strategic priority in the new DfID operational plan for Afghanistan from 2015 and that women will be properly consulted in the development of the strategic priority?
As Syria is likely to be a focus in the next NAP period, can the Minister tell us how Syrian women’s future participation in the design, implementation and programming will be managed, prioritised and made more meaningful? It is surely time that the role of women in conflict prevention, peacebuilding and recovery is recognised, and is not the new NAP an opportunity to do exactly that?
Baroness Tonge (Ind LD)
My Lords, I, too, congratulate the noble Baroness on introducing this debate, looking forward as it does to the publication of the new action plan. Of course, I am very pleased that the UK is leading on this issue, but I want to widen the debate a little. We talk constantly of the empowerment of women, which is a very noble debate, but empowerment is hindered by two main factors. The power of men, of course, is the number one factor and very important. I remember in South Sudan years ago being asked to talk to the women of a certain area about their problems and possible ways of engaging them in decision-making. It took me all morning to persuade the men that we did not want them present at the discussions. A compromise was eventually reached in the end and the men encircled us, but at a distance where I thought that if we talked quietly they would not hear our conversation. I hope the women did not get beaten that evening, but they probably did.
The other factor holding women back is our own physiology. Women cannot be empowered if they have too many children and too much work to do. They have not the time to sit on councils and engage in decision-making at any level. As chair of the All-Party Parliamentary Group on Population, Development and Reproductive Health, I must impress on Ministers over and again that the most useful intervention that we can make to empower women is to ensure that family planning supplies are available to control their fertility voluntarily. Some 220 million women are still without access to contraceptive supplies, with 250,000 women dying in childbirth and millions more suffering chronic ill heath and injury as a result of there being no healthcare when their babies are born. There is no empowerment for them or for the women raped in conflict with no access to emergency contraception or safe abortion in conflict situations, even though humanitarian law and the Geneva conventions decree that it should be available. No empowerment either for the girls who leave education at puberty to be married and start having babies far too early for their immature bodies. Empowerment is but a dream. Therefore, engagement in any of these decision-making processes is impossible.
Look at our own history. Our less well-off grandmothers took little part in society or decision-making, even if they had accessed higher education, because of the burdens of unplanned pregnancies. Contraception freely available will also help to prevent overpopulation and diminishing resources, especially water. There is more and more evidence showing this. This is another and major cause of conflict—the battle for scarce resources. Too many youths in particular, with little hope of jobs, are fighting for scanty food and water, which means more conflict, more suffering for women and less chance of their empowerment.
This Government have made huge progress in reproductive health rights, maternal health, family planning and safe abortion provision, in particular, in the past three years, and I thank them and commend them for that. But I am concerned about this action plan, and I hope that, when it is published, it will keep up this momentum and acknowledge the importance of these issues if we are ever to give women a share in decision-making and contribute to peace and security in future.
The Lord Bishop of Wakefield
My Lords, I, too, congratulate the noble Baroness, Lady Prosser, on securing this debate. I reassure noble Lords that I am not speaking simply to bring a modicum of gender balance to the Chamber.
Many years ago now, when we were living in the East Midlands, my wife was a volunteer at a women’s refuge. She was scrupulous in maintaining confidentiality about those who used the refuge. None the less, on occasion, she would return home shocked and distressed at the violence that women had experienced, even here in our own country. It was a phenomenon that did not relate to just one stratum of society.
More widely, my own experience internationally as the Archbishop of Canterbury’s International Secretary in the 1990s and, more recently, with the international links that I have nurtured since being a diocesan bishop, I have been appalled by many of the stories of violence and abuse of women across the world. From widespread genital mutilation in Ethiopia to violence against women employed in gold-mining ventures by unscrupulous individuals in Tanzania, the stories continued to be manifold. Also included was violence against women in the terrible civil war at the end of the Mengistu regime in Ethiopia.
The churches have played a key part in addressing all these horrors, particularly the issue of genital mutilation. In the continuing conflicts in both the Central African Republic and the Democratic Republic of the Congo, each tells its own horrific tale.
I was fortunate enough to secure a debate in this Chamber last March on just this subject. In that debate I paid tribute to the Secretary of State for Foreign and Commonwealth Affairs for his very important initiative on sexual violence in conflict, which has already been mentioned on a number of occasions. As we all know, the first National Action Plan on Women, Peace and Security finished last year. Noble Lords have already heard, most notably from the noble Baroness, Lady Thornton, of the patchiness of plans across different nations on women, peace and security. As plans advance for the next stage of the national action plan, I ask Her Majesty's Government: will they conduct in-country consultations with civil society organisations, including faith leaders and churches, in each of the priority countries, before the development of the next UK national action plan?
Baroness Thornton (Lab)
My Lords, I congratulate my noble friend Lady Prosser on this debate and, indeed, all the speakers across the House, who, as usual, spoke with passion and expertise about this subject. I also thank Womankind and the Library for the excellent briefings they produced.
Hardly a week goes by without reports of the effect of conflict on women and children, whether it is in Syria, Sri Lanka or Afghanistan. As this debate reflects and as all the speakers have said, the world faces dealing with the normalisation of rape and sexual violence in conflict and, too, the disproportionate impact the conflict is having on women and children. Yet the irony is that women always offer the best hope for building lasting peace in any conflict situation.
Women’s voices should be heard not only because they are the victims of war; their active participation in peace efforts is essential, because they are the most effective peacebuilders. As men take up arms, women hold communities together in times of war. That makes them stronger and better equipped to play a key role in securing real peace. As the noble Baroness, Lady Jenkin, said, Ban Ki-moon is to be congratulated on his recognition of the importance of women. As my noble friend Lady Kinnock pointed out, the importance of women is at all levels.
Peacebuilding involves not just political leaders, but all of civil society, including women. I think we would all agree that without their full support and participation, no peace agreement can succeed in the long run. We know from our own experience that women leaders can often be successful in what seem to be intractable situations; we can point to the work of the noble Baroness, Lady Ashton, in Europe and Iran.
The three-year review is very important indeed. I intend to spend most of the rest of my time listing questions that were in the briefings that we have been given and which have not necessarily been mentioned by other participants in the debate.
The right reverend Prelate was quite right in his question about the importance of consultation with civil society organisations. I, too, seek reassurance about that and on whether the Government are incorporating commitments to ongoing engagement and consultation with civil society organisations, particularly those to do with women’s rights, into the UK NAP to monitor and review its implementation and impact.
On capacity, co-ordination and consistency, will the Government seek a more joined-up reporting approach by departments in the new NAP? How will the Government ensure that desk officers, posts, country offices and the military use the new UK NAP content as guiding principles of their work? Will the new UK NAP link women, peace and security into the wider conflict and human rights work undertaken by the Government? Will there be commitments in the new NAP on how the UK will implement women, peace and security principles within its own security and justice systems, including the police and the military?
The MoD has already been mentioned by other speakers. Will it train UK forces on gender and incorporate WPS in efforts on security sector reform? Will the MoD appoint a gender adviser to take forward its work on WPS? Will it ensure that it includes WPS components when it trains other military organisations?
How will the Government measure the impact of their participation work? How will they work with and support local women’s rights organisations to support their capacity and participation? How will the Government ensure that women make up at least 30% of all negotiation and mediation teams in line with best practice guidelines? Finally, will the UK develop a roster of women whom it can nominate for peace negotiations?
Baroness Northover (LD)
My Lords, I, too, thank the noble Baroness, Lady Prosser, for securing this important debate and for her tireless work in this area. I thank her and other speakers for the tributes they paid to the Government on the work that has been done, and note the comments about progress that is yet to come.
The noble Baroness, Lady Prosser, is right to say that the powerlessness of women is at the root of this problem, which is why the education of women, ensuring that they are independent, have bank accounts and participate at all levels of society is key. As she said that, I found myself thinking about groups that I met in India over the past few days. I could see that DfID’s support for women and girls was transformational, but also how far we have to go. It is in the light of this that we need to assess what is happening in terms of women, peace and security.
We firmly share the view so powerfully expressed in this debate that women must be at the heart of peace and security. They are central to efforts to prevent violent conflict overseas and to build strong societies yet too often, as speakers have said, women and girls are excluded from peace processes and continue to be especially vulnerable to violence, with dreadful consequences.
The UN estimates that at least one out of every three women around the world has been beaten, coerced into sex, or otherwise abused in their lifetime. Although women and children represent 90% of casualties of conflict, only 8% of participants in peace negotiations have been women. Of nearly 600 peace agreements signed between 1990 and 2010, only 16% contained references to women. Looking more widely, women are too often marginalised in society generally. For example, they account for only 21% of parliamentarians globally, and would not be at that level but for quotas.
There is international consensus on what needs to be done. The UN Security Council set this out in 2000, in its Resolution 1325, and in the six resolutions since mentioned by the noble Baroness, Lady Prosser. The council called for action under four pillars: women’s participation in building peace; preventing conflict and preventing violence against women and girls; protecting them; and making them central to the provision of humanitarian relief and a society’s recovery from conflict.
The UK can be pleased with how far we have come across government to put women and girls at the centre of policy. As my noble friend Lady Jenkin mentioned, my right honourable friend the Foreign Secretary is leading an international effort to shatter a culture of impunity for sexual violence in conflict, building global momentum and taking practical action on the ground, including deploying experts to help in countries ranging from the DRC to Syria, and from Bosnia to Mali. The Global Summit to End Sexual Violence in Conflict, to which noble Lords referred, will take place in June, and 140 countries, international organisations and members of civil society will come together to discuss and agree what more we can do to tackle these terrible crimes. I will take back my noble friend Lady Falkner’s suggestion about the All-Party Group on UN Women.
My noble friend Lady Falkner flagged up those countries that do not have national action plans. I assure her that we are working bilaterally with such countries on security and justice reform, preventing violence against women and girls, empowerment, and tackling violence against women and girls in humanitarian settings. We are certainly encouraging those various countries to take that forward.
The noble Baroness, Lady Kinnock, mentioned Syrian women’s participation, and she will have noted that my right honourable friend the Foreign Secretary has been urging that women are included in the discussions on Syria’s future, and we will continue to do so.
The Department for International Development, as many noble Lords will know, works very hard to try to prevent violence against women and girls. Its strategic vision for girls and women promotes women and girls’ health and rights, and their access to economic resources and education—very much building upon the ideas that the noble Baroness, Lady Prosser, outlined. It builds women’s political and civil participation and puts women’s and girls’ needs at the centre of our humanitarian response. It makes the policy arguments, including at the UN Commission on the Status of Women and in the debate about what follows the 2015 millennium development goals. Noble Lords will know that the United Kingdom is pushing hard for a stand-alone goal on gender. My honourable friend Lynne Featherstone is the Government’s champion on tackling violence against women and girls, and has led groundbreaking work in this area, including on tackling FGM.
A number of noble Lords mentioned the Ministry of Defence. Its goals cover personnel, training and operations, as noble Lords will know. It regularly reviews the employability of women in the Armed Forces and aims to ensure that gender is understood in all that the MoD does. The noble Baronesses, Lady Kinnock and Lady Thornton, flagged up this area in particular. The MoD constantly reviews training and includes sexual violence scenarios in pre-deployment. Operational planning for new theatres will take into consideration tackling sexual violence. NATO has carried out a lot of work towards integrating UN Security Council Resolution 1325 and gender perspectives into its command structure. This is a template that the Ministry of Defence can apply. We are also looking at the example set by Canada in terms of training overseas, and are seeking to see whether that can be brought into the way in which we do things through the Ministry of Defence. In terms of senior leadership, which the noble Baroness, Lady Kinnock, mentioned, we have, according to this note here, two female air vice-marshals in the Ministry of Defence, so we are making some progress but are acutely aware of the challenges that the MoD faces. I am sure that her comments will be taken note of.
Action at home is equally important, whether through the Home Office’s work to end violence against women and girls or the Government’s agenda to see women play a greater role in public life. We want women to represent half of new public appointees by the end of this Parliament, and we have reached a figure of 45%.
The noble Baroness, Lady Prosser, raised the subject of quotas and whether negotiation and mediation teams will be at least 30% female. The Government are reluctant to set a specific figure on women’s representation, but we are pushing hard to improve numbers. I am sure that this will be kept under review.
The UN Security Council calls for member states to deliver on all four pillars through national action plans. The UK adopted its first such plan in 2006 and we will soon, as noble Lords mentioned, launch our third plan, for the next three years. My noble friend Lady Hodgson is right that this needs to be strategic and joined up across government for it to have its best effect. I read with enormous interest the independent review of the previous national action plan, which makes this point very clearly.
The challenge for the next plan is to bring together all the work that we do—we recognise that—and to ensure that we deliver both globally and on the ground and test our plans against what those in this field are saying to us. We will bring under one framework our work on the Preventing Sexual Violence Initiative, the strategic vision for girls and women and the call to action on protecting women in emergencies, as well as our work at the UN Security Council and at the Commission on the Status of Women. I hope that this reassures noble Lords, including the noble Baroness, Lady Kinnock, that that is the approach that we are taking. My noble friend Lady Hodgson asked about the review of the national action plan and whether it will continue to be reviewed annually and reported to Parliament. We will continue to report annually on this, as well as to hold frequent meetings about it.
We are also learning from what appears to be working. DfID has a fund of, I think, £25 million—I do not have the exact figure in front of me—which is a research and innovation fund. My noble friend Lady Falkner asked about what we were learning; that fund is seeking to analyse what works and, therefore, what should be taken forward further. We are seeking to bring all this together; I think that that is vital. We will deliver multilaterally, through the United Nations, NATO and the European Union and now also in partnership with the African Union. We will put in place stringent monitoring and evaluation to assess the impact and outcomes of our actions and to capture the changes that our national action plan will make for girls and women on the ground. We will integrate women, peace and security issues into the work of the new Conflict, Stability and Security Fund. I hope that that reassures the noble Baroness, Lady Kinnock.
I can reassure the noble Baroness, Lady Prosser, that there will be central guidance from the fund on women, peace and security, although our conclusion is that a ring-fenced allocation would in fact encourage programme designers to take a compartmentalised approach to women. We think that it is extremely important, as that review indicates, to look at this strategically and make sure that it runs right through all the various programmes, but I understand people’s concern and the necessity to make sure that is does indeed run though every programme.
We will also be consulting both in the UK and on the ground and we take very seriously the Associate Parliamentary Group on Women, Peace and Security and Gender Action for Peace and Security. They were instrumental in delivering a successful workshop at our embassy in Kabul in December and will remain invaluable as we plan and carry out more workshops before April. We continue to be very engaged as far as the position of women in Afghanistan is concerned.
As we prepare to adopt and implement a new national action plan, we can be proud of what we have achieved but we recognise that we have much more to do and that we need impact that helps to shift general attitudes in society, protects women and girls and secures a better place for them in delivering peace and security. What lies behind all this, as noble Lords have made clear, is gender inequality. They are right that addressing this is fundamental to ensuring that women and girls are at the heart of all that we do, everywhere and in everything.
Lord Wallace of Saltaire (LD)
My Lords, we began this debate by having 62 minutes for a 60-minute debate, including the intervention in the gap. Thanks to the immense self-discipline of speakers—in particular, that of the opposition final speaker—we have now ended with three minutes to spare. Therefore, I beg to move that the House do adjourn during pleasure until 8.47 pm.
Pensions Bill
(10 years, 9 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, I am aware that the noble Lord, Lord McKenzie, cannot be present today for personal reasons. Given the circumstances, I should be happy to have further discussions with him about his Amendment 7.
Baroness Sherlock (Lab)
My Lords, I know that my noble friend would wish to bring back his amendment at Third Reading. Would that be okay with the Minister?
Lord Freud
“In section 1 (outline of contributory system), in subsection (1)(a), after “this Act” insert “or any other Act”.
In section 13 (Class 3 contributions), in subsection (2), omit “contribution”.
After section 19A insert—
“19B Extended meaning of “benefit” etc in Part 1
In this Part references to “benefit” or “contributory benefit” include benefit under Part 1 of the Pensions Act 2014.””
“(5ZB) Regulations under subsection (5ZA) must provide for crediting a person with such contributions as may be specified in respect of periods on or after 6 April 1975 during which the person was—
(a) a spouse or civil partner of a member of Her Majesty’s forces,(b) accompanying the member on an assignment outside the United Kingdom, and(c) not of a description specified in the regulations.”
“In section 122(1) (interpretation), in the definition of “benefit”, after paragraph (c) insert—
“(For the meaning of “benefit” in Part 1, see also section 19B)”.”
Lord Whitty
“( ) The power conferred by subsection (2) on employers to amend occupational pension schemes does not override the powers and duties of Trustees of such schemes nor any duty to consult members of such schemes and their representatives in accordance with the terms of such schemes.”
Lord Whitty (Lab)
My Lords, with Clause 24 and Schedule 14 we deal with the impact of the ending of contracting out on existing occupational, or work-based, pension schemes. The impact is pretty severe, being up to 5% of the income of those schemes. The Government have provided some measures in Schedule 14 and Clause 24 that allow employers effectively either to increase the contributions of employees but not of employers or to cut back on the benefits of those schemes. I do not approve of that way of dealing with the situation for either the public or the private sectors. Of course, ending contracting out impacts on both sectors. Although Clause 24 is primarily about the private sector, there are a couple of related questions on the public sector that I should like to put to the Minister.
I declare an interest as a vice-president of the Local Government Association and as a long-term member of the GMB. I am therefore particularly concerned about the local government scheme but other public sector schemes are also affected. In Committee the Minister indicated that he was prepared to have discussions with the LGA—and, presumably, parallel discussions with other public sector employers—to consider how the loss to its funds could be made up.
I understand that a meeting took place on 14 January and that the noble Lord, Lord German, was present at that meeting and may be able to elucidate. However, from the note of the meeting that I have seen, I am not clear as to the Government’s position on follow-up to that meeting in relation to the Local Government Pension Scheme. Of course, the Local Government Pension Scheme affects a large number of employers, not only local authorities but others in the public, private and third sectors. It is therefore important that some understanding of the stability of those schemes in future public expenditure allocations is established. It would be useful to hear of any progress on that or parallel fronts, so can the Minister update us on progress?
As to some of the schemes which are now in the private sector, Amendment 14 goes some way to meeting the concerns expressed on behalf of the post-privatisation schemes where guarantees were given that there would not be any diminution in the benefits from such schemes at the point of privatisation. So anyone who was in a scheme before that point should have been covered. I welcome that. However, I have a concern about the definition of “protected person”. The amendment refers to it being defined in regulations, whereas the schemes to which the Government have referred in their statements on electricity, railways, nuclear decommissioning and coal do not cover all the people who were given guarantees post-privatisation. For example, the guarantees for gas workers were written into the deeds of the scheme but were nevertheless promises backed by the Government. I should therefore like to know how far into the area of protected persons the regulations are likely to go. If the noble Lord wishes to write to me on that front I would be grateful but, in any case, out of equity, it ought to be addressed in the same way for every group of workers affected during that period of major privatisation of the utilities and other nationalised industries.
Of course, the Government have provided in Clause 24 and Schedule 14 a way out for others who are in private sector schemes. The way out is hugely detrimental to the members of those schemes in that it gives the right of override to employers—not to the scheme—to alter the terms of that scheme in order to make up the effects of the ending of contracting out, which can be up to a 5% deficit in such schemes. As the Bill stands, that ability to override is without reference to trustees, without invoking any consultation with members and without negotiations with trade unions or other worker representatives. Amendment 11 seeks to ensure that the rights of trustees are protected and that their legal responsibilities are recognised; that the trustees will be involved in any alteration of the scheme; and that consultation will be conducted in accordance with the terms of the scheme. Amendment 13, tabled by my noble friend Lady Turner, goes further and requires a ballot of members of such schemes. Unless we do that, we are seriously undermining the whole system of trusteeship of private sector occupational schemes.
I hope that the Minister will be able to tell me that Amendment 12 is unnecessary because it is in the existing law. I hope that is the case but the terms of Clause 24 and Schedule 14 which allow for override and alteration are extremely wide. It should have been the law and it was generally accepted that it was the law post the Maxwell scandal and the reforms that led to the requirement that schemes could not at any point retrospectively change the accrued benefit of members up to that point. In other words, the scheme could be altered subsequently but anything accrued up to the point of change could not be retrospectively downgraded. Amendment 12 seeks to ensure clearly that this is the case.
We need clarity from the Government on this and we need their vision for the future of occupational work-based schemes because there is a contradiction in the Government’s position. On the one hand, we are engaged in a system of auto-enrolment to increase the coverage for workers who hitherto have been outside occupational schemes, and in principle we welcome all that. On the other hand, the effects of the Bill, without mitigation of the kind I am suggesting in Amendments 11 and 12, will undermine and even destroy the viability of many existing schemes. It is not just the final salary schemes that we are talking about here, or career average schemes or simply defined benefit schemes. It will also apply to or have implications for all occupational pension schemes, partly because of the financial effect but also because the viability of pension schemes depends not only on the funding arrangements and the rigour with which those schemes are managed, but on the mutuality between the members, the employers and the funders under which those schemes are set up. That is reflected in the trustee arrangements; expectations are based on that mutuality continuing and on that trustee protection. If that goes, then members’ and potential members’ trust in such schemes goes too. We need to hear clearly from the Government what their intentions are for this sector.
If trust goes, then the level of opt-out from such schemes will increase. Pension schemes will be seen as non-viable. Some pension schemes will fail and the workers and the employers who have hitherto seen their pension contributions as part of deferred pay may no longer regard them in that light. Therefore, pressure might grow for them to be paid immediately. Pension schemes are the most effective form of savings but they will not appear that way if trust in such schemes disappears. That is bad for future pensioners but it is also bad for the economy if that element of relatively automatic saving is undermined. To maintain the trust, the role of trustees is vital. I would therefore like the Government to accept Amendment 11 and to indicate that the role of trustees, and therefore the trust in such schemes, would be maintained. That is not to say that alterations could not be made, but they would be made through the way in which the role of the trustees and the consultation is laid down in such schemes.
At a minimum, I hope that the Government can accept Amendment 11, confirm my understanding that Amendment 12 is indeed the law as it stands and clarify the situation of protected persons in the post-privatisation schemes. I would also like them at least to consider accepting the amendment tabled by my noble friend Lady Turner, which would delete Schedule 14 entirely, because the idea behind this whole way of overriding long-standing schemes is pernicious. Amendment 11 gives a way of doing it in effect, but doing it by consent, which is far preferable and will preserve a very significant part of the remuneration package and savings structure of the country. I beg to move.
Baroness Turner of Camden (Lab)
My Lords, in this section of the Bill employers are given a new power to change the provisions of a scheme in order to cover the NI costs to which they will be subjected. They may apparently do so without having to seek the agreement of staff or their unions. As my noble friend has pointed out, this is an overriding power to which a number of us objected at earlier stages when discussing the Bill. Schedule 11 sets out the provisions in some detail.
At Second Reading I referred to the development of what we now call defined benefit schemes, and what used to be called final salary schemes, as a result of which generations of pensioners have enjoyed excellent retirement provision. There was a move some years ago to change such schemes to money purchase schemes or schemes with less generous protection. Where the workforce was strong enough, probably with active union involvement, such schemes have been maintained. There is now, as a result of this Bill, concern among those who have not yet reached retirement age that these schemes will not continue and that employers will utilise the provisions in Schedule 11 to undermine or change them. Hence my amendment, which stipulates that an employer may not change these benefits without the agreement of the current scheme members, which under my amendment could be ascertained through a poll. I hope that the Government will agree that it is reasonable for the members of the scheme to have the final say. If an employer wants to change the existing arrangements, it must be by negotiation with the staff and their representatives and by agreement. Again, I hope the Government will agree that that is reasonable. If they do not, I would like to oppose the whole clause and the schedule.
I want to make another point about so-called protected persons. This was raised during earlier discussions and referred to again by my noble friend today. The Government have agreed in principle that individuals who were members of schemes when their employing companies were being denationalised would retain their pension provision. I believe the assurance is that where this protection has been agreed by statute, it will continue. I welcome that, and would like to see an endorsement of the point by the Minister. There are others who believe that they are covered not by statute but because their own private scheme gives them cover. Because of a change of ownership that might happen, they are concerned about their position in the future. Their position is not protected by statute, only by their own scheme. These people have concerns about what might happen to their DB scheme. My amendment would provide some cover because of the necessity to get the agreement of scheme members to any changes to benefit.
I wait with interest to hear what the Minister has to say to this, and in particular what he will say about his own Amendment 14, which looks like a tentative step in our direction. I hope that it is more than a tentative step and that he is undertaking to do something of the kind that we have been campaigning for and would like to see in the Bill before it leaves this House. I support the amendments already spoken to.
Lord Browne of Ladyton (Lab)
My Lords, it is a pleasure to follow my noble friends Lady Turner and Lord Whitty, who have robustly set out a fundamental challenge to Clause 24 and Schedule 13, which I think the Minister is required to engage with. Would the noble Lord and the Pensions Minister argue that the loss of the rebate, without some consequential provisions, would lead to the closure of defined benefit schemes? In short, my noble friends argue that this is where it will lead, even with the override which is designed to prevent their loss. There is a fundamental difference which deserves to be addressed in the way specifically asked for by my noble friend Lord Whitty. I am sure that the Minister will be conscious of that.
On the issue of protected persons, I welcome the Government’s concession, set out in Amendment 14, confirming that they will honour the specific undertaking given to the members of these schemes to encourage them to accept privatisation of the industries for which they worked. That is exactly why this undertaking was given to them. It has been promised for some time. Belated it may be in its delivery, but it is none the less welcome and it will be a relief to the 60,000 or more members of those identifiable schemes who have been awaiting this decision.
My noble friend Lord Whitty raised an interesting question about whether this concession can be made to apply in some form to gas workers who have a similar undertaking, but which was enshrined in a different way. I would be interested in what the Minister says about that.
Were my noble friend Lord Whitty’s Amendment 11 enacted it would ensure that:
“The power conferred … on employers to amend occupational pension schemes does not override the powers and duties of Trustees of such schemes nor any duty to consult members of such schemes and their representatives”.
To the extent that this amendment requires consultation with trustees, we support it. We had an extensive debate on these issues in Grand Committee and I made clear then that our position is one of broad agreement with the change to a single-tier pension and the aim of introducing simplicity into the state pension system. We also accepted that this required an end to contracting out. However, we agreed with the arguments put forward in Committee by my noble friend Lady Drake that statutory overrides are strong measures and should be used with care in all cases, at the very least requiring an employer to consult pension trustees before exercising the power to amend a pension scheme.
It would be to the benefit of understanding the Government’s position if the Minister would make clear in his response why the Government had set their face against consultation with trustees, especially when it is preserved in the statutory requirement to consult scheme members. It surely cannot be the case that the different approach to these forms of consultation is that consultation with trustees would be meaningful, but that consultation with individual members would be anything but—indeed it would be pointless. Like my noble friend Lord Whitty, I hope that the Minister’s response to Amendment 12 will be that it is unnecessary. It is my view that this is an expression of the current state of the law.
Finally, my noble friend raised an interesting point about public sector pensions, from his knowledge of the understandings that appear to have been implied by the meeting with the LGA. We would all be interested to know when further follow-up can be expected.
Lord Freud
My Lords, under the current system it is possible for defined benefit schemes to contract out of the additional state pension, giving up entitlement for additional state pension in return for a broadly similar occupational pension and payment of a lower national insurance rate for both employer and employee. When single tier is introduced, there will no longer be an additional state pension for defined benefit schemes to contract out of. Employers with such schemes will therefore no longer receive a national insurance rebate in respect of contracted-out members.
Employers will need to find ways to recoup the costs that the loss of the rebate brings. Unless they are able to do that, many employers will be forced to close their schemes. Clearly, members are not served by their pension schemes closing and the Government are committed to supporting the continuation of defined benefit pension provision. To that end, we are providing a statutory override to allow private sector employers to make limited changes to their schemes to adjust for the additional cost due to the end of contracting out. This is part of our wider state pension reforms. The majority of contracted-out workers in the private sector who reach state pension age in the first two decades of single tier will get enough extra state pension to offset the increase in national insurance they will pay over the rest of their working lives and any potential adjustments to their occupational pension schemes.
Noble Lords have made clear their concerns that the override is not abused by employers and that trustees and members are properly consulted about any changes. I fully recognise those concerns. The override allows for limited changes to future accruals and/or future contributions where the scheme rules would otherwise prevent that. I make it absolutely clear that the override does not permit the employer to ignore other rules about how the scheme operates. For example, it does not mean that an employer can avoid notifying trustees or members of a change, or refuse to carry out a consultation, if scheme rules would require this. Indeed, existing legislation requires that members are consulted on any significant rule changes before they are made. In response to the query from the noble Lord, Lord Whitty, that will remain the case. In addition, we have every reason to believe that employers will want to engage with trustees about how best to respond to the end of contracting out and believe it is in their best interest to do so.
Schedule 14 provides important safeguards, such as limits on the use of the override to prevent an employer from making changes beyond those necessary to recoup their increase in national insurance contributions, the need for an actuary to certify the changes and protection for members’ accrued rights. We will put further safeguards in regulations—for example, to ensure that the employer cannot create their own assumptions for the purposes of the calculation but must draw on existing assumptions used by the scheme.
Amendment 11 concerns protection for trustee powers and duties. As I have said, the override does not prevent the scheme operating normally. The only powers or duties that the override applies to—and therefore that the amendment would protect—are those that require trustee consent to changes or provide that only trustees can change scheme rules. Where these powers stay in place, they would make the override unusable, which in turn could encourage employers to close their scheme. Amendment 11 also seeks to ensure that the statutory override does not trump any duty to consult scheme members and their representatives. Such an amendment is unnecessary as scheme rules and existing legislation requiring member and representative consultation are not affected by the override.
The Government recognise that a trustee’s fiduciary duty to the scheme’s members may put them in a difficult position if they are required to agree scheme changes that, at face value, are detrimental to the member. However, the statutory override does not prevent the employer from engaging with the trustees on any scheme changes they are considering. It is in the employer’s interest to engage with trustees on proposed changes. Trustees are responsible for administering the pension scheme. All schemes need lead time before any changes can take place, to allow for IT systems to be updated and changes to the title deed to be made.
Part of Amendment 12 seeks to protect current members’ accrued rights. The Government absolutely agree that any accrued rights should be protected and preserved, and I reassure the noble Lord, Lord Whitty, and other noble Lords that the Bill already provides such protection by way of paragraph 3 of Schedule 14. This refers to the protection of “subsisting rights”—the term used in pension legislation—for both scheme members and their survivors.
Amendment 12 would also remove the stipulation that changes made in respect of future members have to correspond to changes made in respect of current members. It is important to remember that the override will enable employers to offset the additional cost of national insurance that arises from April 2016. The amendment would broaden the override. An employer could set different contribution rates or different rates of accrual for current and future members. I do not believe that that would be right. The increased national insurance costs to the employer from 2016 will be the same for both groups of members, and the Bill as drafted ensures that the override reflects that.
Lord German (LD)
Will my noble friend allow me a moment’s intervention? I was present at that meeting, and I found it very interesting to have a representative of HMRC there. One of the principal conclusions I drew from that meeting was that there was an agreement between the LGA and HMRC that they would examine up front any arrangement for the distribution of additional funds from HMRC to local government pension funds, and would get the process sorted out in advance so that if money became available the method of distribution would be quick and would help them in their procedure. Can my noble friend confirm my understanding that HMRC is onside with this?
Lord Freud
My noble friend is probably way ahead of everyone in this Chamber at this moment on this matter, but I think I can simply answer yes to his understanding. As he says, whereas final decisions tend to get taken at a relatively late moment, if the processes are well organised, that matters less and they can be effectively activated.
The ending of contracting out is an inevitable consequence of the state pension reforms. We want to manage this as smoothly as possible and to minimise impacts on employers, schemes and individuals. I have set out why the override is necessary and why the amendments tabled by the noble Baroness and the noble Lord would make the override unworkable. Amendment 11 would in many cases allow trustees to block changes to the scheme and would increase the risk that employers would simply close their schemes. That is why I urge the noble Lord to withdraw his amendment.
Lord Whitty
My Lords, I thank the Minister for that. There is quite a lot in there which has cheered me up slightly—not everything, but bits of it. I am grateful for this update on the LGA position. We will watch this space. I am interested to see that there are other sectors that could be involved in that. I welcome the Minister’s statement in relation to the consultation of members of the scheme. I think I am quoting him correctly that the override does not affect the duty to consult, that the Government support the continuation of DB schemes and that the rules of such schemes on consultation are not affected by the override.
That deals with the consultation with members of the scheme, but it does not effectively deal with the trustee position, and the role of the trustees is very important in the future of the schemes and in future faith in them. The Minister said that trustees are bound to consult; yes, they are possibly bound to consult. The override clearly applies in his mind, and I presume the intention of the override is that in those schemes that require trustee consent, the employer, using Clause 24 and Schedule 14, can override the need for that consent. That seems a pretty fundamental alternation in the role of trustees. I hope that, even at this late stage, the Government would reconsider that position.
I am grateful for the Minister’s view on accrued rights and the fact that Amendment 12 is not, therefore, needed. I am less grateful for his indication that “protected workers” will not apply to those who are protected on the word of the Government of the day but not actually embedded in statute. This applies principally to the gas workers and I suspect I will be in correspondence with him about that.
The central point of this group of amendments is that, in this clause, the Government have, effectively, overridden the governance structure of work-based occupational schemes by attacking the very fundamentals of trusteeship. That is a mistake. Over the years, many changes have been made at the behest of employers and with the agreement of trustees. Some of these were detrimental to future members because of the financial position of the scheme or legislative changes. Trustees are unlikely to be unable to recognise the need for such changes, but to override and delete trustee consent is a very serious step which the Government should be much more hesitant about taking. However, for the moment, I beg leave to withdraw the amendment and thank the Minister for some of his other remarks.
Lord Freud
“(4) The power may not be used—
(a) to make amendments that apply to a member who is a protected person in relation to a scheme, or(b) to amend a public service pension scheme or a scheme of a description specified in regulations under this paragraph.(5) Regulations must define what is meant by a protected person in relation to a scheme for the purposes of subsection (4)(a).”
Baroness Turner of Camden
Baroness Turner of Camden
My Lords, this is a short amendment dealing with the section of the Bill that allows for the periodic review of rules about pensionable age. When I read it, I was concerned that there was nothing at all about the type of work people undertook before they retired. At Second Reading, I said that there were many people who were quite happy to go on working past normal retirement age but it depends on the kind of job you do, whether you are well paid, whether your job has authority, whether you enjoy your job and so on. However, there are many people who do work that is very necessary if the rest of us are to lead reasonably comfortable lives, such as people who work in construction and other industries where there is strenuous activity and, sometimes, danger. It is not a good idea to have elderly people in this kind of work.
It is too late in the day to make a long statement about this, but if there is to be a review of retirement ages it must be understood that people do very different types of work and it is not a good idea to think that one size fits all. I hope the Government will realise that in a periodic review of retirement ages it is sensible also to take on board the kind of work being looked at and the sort of people who are expected to do it. If they do not, it will not be very popular and may lead to problems in the future. You do not want future problems in a pensions Bill, so I suggest the Government think very seriously about this. I quite like Amendment 17, which is also concerned with a review of how retirement age is judged and brings a range of representatives of parties, including trade unions, into consultation, which is also very sensible. In the mean time, I beg to move.
Baroness Sherlock
My Lords, in speaking to Amendment 16, I shall also speak to Amendment 17 in my name and that of my noble friend Lord Browne. We on these Benches agree with the principle of raising the state pension age to reflect longevity. We accept the need for periodic reviews of the state pension age. Where we differ from the Government is on how best to do that.
Fixing the state pension age is never easy. There is always an issue of fairness at stake. Having a careful, evidence-based review before taking any future decisions on changes to the state pension age is a crucial element of ensuring fairness between generations. However, sometimes fairness requires a consideration of difference, particularly differences in longevity and health. The Government are setting considerable store by actuarial information on average life expectancy. However, while average life expectancy tells us something—mostly quite a lot about medical advances and their ability to keep us alive for longer—it does not tell us very much about our health in retirement or differential mortality rates.
We heard a great deal of evidence in Committee to inform our debate, and I certainly will not rehearse it all here, noble Lords will be relieved to hear. However, maybe the headlines are worth briefly restating. People are living longer, but the proportion of years in full health is not keeping track at the same rate. We have significant inequalities in health within the UK, and significant variations in mortality as a result. There are clear socioeconomic differences. There is a class divide, as managerial and professional classes live longer than manual workers by 3.8 years for women and 3.1 years for men. There is a clear geographical divide.
There is then the effect of this differential life expectancy on state retirement incomes, with the irony that those living the shortest lives post-retirement—the poorest and least skilled workers—will receive less in state pension than their better-off counterparts, but they may well have contributed for longer as a result of having spent less time in education.
If we want people to save for retirement, they need to trust the Government, to trust Parliament and to believe that their pensions are safe in our hands. The public need to know that they will not be at the mercy of political expediency, and that they will be protected from any adjustments that need to be made by ensuring that they are not made too quickly. Rather than simply being a matter for the Secretary of State, as the Bill proposes, we need a genuinely independent panel which has the kind of cross-party and independent representation that will reassure the public and give confidence to parliamentarians from across the spectrum. Our amendment proposes simply that the review body should include representatives of the opposition parties and of the Cross Benches of this House to ensure that Parliament as a whole is at the heart of this process. It would also include representatives of trade unions, who are themselves the representatives of those who are spending their ever-longer working lives saving for retirement. This broader representation will give people confidence that a wide range of views will be heard. I urge the Minister to accept it.
Lord Freud
My Lords, as your Lordships know, the purpose of the review of state pension age is to inform the Government. The reports from the Government Actuary and the independently led review, which will feed into the review, should collect and analyse the latest data, and give the Government of the day the information they need to make what will always be a difficult and contentious decision.
We are all keen that the Secretary of State receives a report that is impartial. Because we are requiring that all reports compiled as part of the review are published and all future changes to state pension age continue to go through primary legislation, any proposal based on a report that is not impartial, credible and comprehensive will quickly fall apart when scrutinised by stakeholders and both Houses of Parliament.
Turning first to the substance of the amendment tabled by the noble Baroness, Lady Sherlock, and the noble Lord, Lord Browne, if one thing is apparent it is that there is no clear consensus on who should sit on the review, what they should look at, or how they should collect the necessary evidence. We have been clear in Grand Committee and in the other place that this Government’s vision of the review is one similar to the independent review of public service pensions. That review was run by the noble Lord, Lord Hutton, a member of the opposition Benches and an expert in his field. It was transparent, comprehensive, independent and established a consensus.
Noble Lords will also be aware that the Pensions Commission, set up by the previous Government, had three commissioners from the areas of business, trade unionism and academia: not a single politician or Cross-Bencher. That commission gained support through comprehensive and open debate about the issues and trade-offs, rather than being based on the inherent characteristics of the commissioners’ backgrounds.
In short, the amendment tabled by the noble Baroness, Lady Sherlock, and the noble Lord, Lord Browne, would preclude these two successful models. It would result in a body of at least six individuals from stakeholder groups, the other place and this House. It would not necessarily have the expertise to review the relevant data and would effectively create a mini parliamentary process before the parliamentary process proper. We do not think that is the right way to run a review designed to inform the Government. In the Bill as currently drafted there is nothing to prevent a future Government running the review in whatever way they think best. That is a key point underpinning our approach to the review—getting future Governments to take active ownership of and responsibility for all aspects of the review, instead of just going through the motions.
Turning to the factors to be considered as part of any review, I must note that in response to the recommendation made by the noble Baronesses, Lady Turner and Lady Sherlock, we do not have the data regarding the relationship between specific occupations or types of work and life expectancy and healthy life expectancy. Beginning to collect such data would be both burdensome and, I imagine, for some professions simply impossible. More generally, we do not think it is necessary to specify any factors to be considered in legislation. We have already consulted stakeholders on what factors they think are important, and stated the factors we expect to be considered in the White Paper. The Opposition are worried that by not specifying the factors in legislation, future reviews simply will not consider important variables. However, what kind of support would such a review generate?
We want to encourage all interested parties to feed in their thoughts and contributions to better involve them. Specifying factors in the Bill could send out the message that we have already thought of everything important, and that future Governments do not need to consider additional factors as they are not set out in primary legislation. Such an approach could lead to a tick-box mentality, with Governments simply going through the motions instead of taking a proper, considered approach to each review. My point is illustrated by the fact that another factor has been added to the Opposition’s amendment since its predecessor was tabled only a month or so ago. Other noble Lords have also previously suggested additional factors, including life expectancy of the lowest income decile, prevalence of smoking and quality of diet. This demonstrates that the determination of relevant factors should take place after a thorough and extensive consideration and on an iterative basis for each review.
I turn now to the review’s remit. We believe that the Government should maintain control of this to keep it focused on the task at hand. There is nothing in the Bill to prevent the Secretary of State of the day updating the remit of the review, and we—or, more importantly, stakeholders—would fully expect him or her to do just this if new and compelling factors were identified during the course of the review.
The amendment of the noble Baroness, Lady Sherlock, also requires evidence to be gathered in public sessions. Although there is nothing in the Bill to prevent some evidence being taken orally—rather as Select Committees do—noble Lords will be aware that the nature of the analysis around state pension age, such as the myriad tables, charts and graphs, does not lend itself well to public sessions. Underpinning our approach is the idea that each Government will fully own and be responsible for the review. Setting out membership and factors to be considered restricts rather than increases that responsibility. It would instead limit the scope of reviews and reduce engagement by stakeholders. I therefore urge the noble Baroness to withdraw her amendment.
Baroness Turner of Camden
I thank the Minister for his response. It does not surprise me, but, on the other hand, I still think that the type of work that people do is very important. There are, of course, already industries in this country in which there are different ages of retirement for different types of work. It is not unusual for that to happen; indeed, it is quite a common practice, if an industry is particularly stressful or difficult, for there to be a lower retirement age for that kind of work. It is not an unusual state of affairs but one that is highly regarded where it applies—and people accept it. They think, “Oh well, that sort of work is very tough, but at least you go a bit early for it. You don’t have to stay and work there—after a certain time you can go”.
My husband, who was a pilot in the war, tried to stay in the Air Force because they were recruiting people to fly civil aircraft when the war ended. He tried to get into civil aircraft because he was a pilot, with decorations, but he was disappointed to find that he could not do so. He wanted to get into the civil air force because they had an early retirement age; he thought that he could retire at 50 and start becoming a full-time artist, which is what he had always wanted to do. But he did not manage to do that. I give that as an example, because the age of retirement was different than for general people. So it is not an unusual situation.
I still think that it is quite sensible to have a provision under which it is possible for a review to take seriously into account the type of work that is involved. However, I note what the Minister has said this evening and I shall study it with interest. In the mean time, I beg leave to withdraw the amendment.
“Assessed income period: indefinite period
Notwithstanding sections 28 and 29 above, any recipient of pension credit may from the age of 75 years have his or her assessed income period set for an indefinite period.”
Baroness Hollis of Heigham
My Lords, pensioners usually have stable incomes, especially compared to those who work, and they do not fluctuate by much. At the moment, existing pensioners on pension credit have their income and thus their eligibility assessed every five years at 65, 70 and 75. Thereafter, no further means-testing is required, although people need to report the death of a spouse or when they move into residential care. The Government are proposing to replace this light-touch system with annual means-testing every year until death, with the modest exemption of those currently already over 75, for whom means-testing has been suspended. All future pensioners will have annual means-testing until they die, which means that they will means-test, for example, a frail, 90 year-old widow.
In Committee, we argued that we would retain the current system of five-year assessments of income for pension credit eligibility and the suspension of means-testing after 75, both of which the Minister wishes to replace with annual means-testing. The Minister was not sympathetic; he tried to suggest to my noble friend Lady Sherlock that the new system would be simpler, whereas on any ordinary understanding of the word it is becoming more complicated. Eventually, he fell back on the necessity of making these savings—all £65 million or so extracted from some of the poorest people in the country.
This amendment is modest and targeted. It would permit the Government to means-test pensioners annually, as they propose to do, until the recipient is aged 75, and from then on as now those means tests would be suspended. Why this proposal? My concerns are threefold. First, the proposed changes will discourage pensioners from claiming pension credit. Secondly, it is profoundly unfair. Thirdly, it is not worth the relatively small savings that may follow.
Baroness Sherlock
My Lords, in Committee the Minister came under sustained pressure on this matter from my noble friends Lady Hollis and Lord McKenzie, among others, and I am sure that he did not expect to emerge unscathed from Report. Many noble Lords pressed the Minister in Committee to try to understand what the consequences of this increase in means-testing would be. In particular, they were concerned about what would happen to those older pensioners who inadvertently, or perhaps negligently, fail to report changes of circumstances.
The Minister could not assuage our fears in Committee but wrote to us subsequently. That was helpful as it made clear what would happen. The letter he sent to us, dated 20 January, noted that claimants of any age who commit benefit fraud can be prosecuted. However, it also says:
“DWP may offer an Administrative Penalty as an alternative to prosecution. That penalty is 50% of the overpayment with a minimum value penalty of £350 and a maximum of £2000”.
When a claimant makes an error resulting in an overpayment, the letter explains that,
“a DWP decision maker will consider the full circumstances of the individual case … taking into account the reasons that led to the error”.
The letter then referred us to the guidance for decision-makers. I read this guidance so that noble Lords would not have to, and that is an hour of my life that I will not get back, so anyone who feels that he would like to buy me a drink at any point to say thank you is most welcome to do so. However, having done so, I then discovered the following. Incidentally, CPen means civil penalty and DM means decision-maker. The guidance states:
“Before imposing the CPen, the DM must establish that the claimant
1. has acted negligently and
2. has failed to take any reasonable steps to correct the error that led to the overpayment”.
I accept that the word “negligently” implies something serious. However, on the “Meaning of ‘negligently’”, the guidance continues:
“DMs should note that negligently should be taken to mean acting carelessly, not paying sufficient attention to the task in hand, or disregarding the importance of what is required to be done in relation to the claim or an award”.
In other words, that is a pretty low bar.
A number of noble Lords expressed concerns—as has been done very clearly by my noble friend just now—about what happens to pensioners who might struggle to keep the paperwork together or report every relevant change. The letter from the Minister said that robust safeguards are in place to ensure that matters such as mental capacity are considered. However, the guidance also makes clear that misrepresentation can involve simply leaving a section blank, perhaps because someone cannot figure out how to fill it in at that point and forgets to go back and do so later. The guidance also states at paragraphs 09206-7 that a claimant cannot avoid responsibility for misrepresentation just on the grounds that they claim they did not know what they were doing. It states:
“Non-responsibility is limited to those who are blind, illiterate or do not fully understand a particular form they have signed. Poor education, illness or inborn incapacity alone is not sufficient to show non-responsibility. People are expected to take reasonable steps to understand what they sign”.
This is exactly the sort of reason why so many pensioners dread means-testing and do not claim benefits to which they are entitled. If the Minister does not want to accept this amendment tonight, I plead with him to do one thing. Will he please take this guidance away urgently and have it revised before this legislation ever is introduced, so that pensioners are not expected to follow these kinds of rules?
Lord Freud
My Lords, assessed income periods were introduced by the noble Baroness, Lady Hollis, during the passage of the State Pension Credit Act 2002. At that time it was assumed that income and capital for those above pensionable age remained relatively stable and it therefore made good sense to relax reporting requirements, both for the individual and the department in terms of running costs. This was still the case in 2007 when the Government of the day introduced indefinite assessed income periods for those aged 80 or over.
The noble Baroness said just now that income and capital do not fluctuate by much. We have now tested those assumptions, analysed around 100,000 cases and come to the conclusion that there is actually a greater degree of volatility in people’s financial circumstances than she and the department had anticipated at the relevant times. In some cases, assessed income periods have allowed people to continue to receive pension credit following a change in their circumstances when they would not have been entitled to it had they made a new claim at that point. The evidence means that we have had to think again about the viability of the policy and have concluded that AIPs should be abolished. Ultimately, if we were to allow AIPs to continue, the taxpayer would be providing support to people who no longer need it. It would mean retaining a system in which we can only apply changes to retirement provision that would increase an award but cannot take account of windfalls that would otherwise see a reduction in or loss of benefit.
Let me be clear, we are not changing entitlement rules. We are changing the reporting system so that people’s benefit entitlement reflects their circumstances at the time. To that end, we are looking to simplify the reporting requirements so that we are able to support those who need it most and best target our benefit expenditure. I am of course mindful that by changing reporting requirements some people may find it more difficult to adjust, particularly those of the most advanced years who may have the greatest difficulty in contacting us. This is why existing indefinite assessed income periods in place prior to 2016 will continue.
For those new recipients, or those on fixed-term AIPs, we will have the opportunity to explain clearly what does and does not need to be reported at the point of claim or when their existing claim is reviewed. I stress that pension credit is already designed in such a way as to minimise reporting requirements. For example, changes to capital only need to be reported if their total amount exceeds £10,000. Currently, only 12% of people on pension credit have capital above that level. People would need to report new income streams, but we will continue to take into account annual increases in pensions automatically, based on what people tell us. We will also encourage people to tell us if their capital falls below £10,000 or if any income stops, to ensure that we capture beneficial changes.
Baroness Hollis of Heigham
When the Minister says that there is no evidence, does that mean that he has sought evidence and there is not any, or does it mean that he simply does not know, or what? Has he evidence to prove that there is no deterrent effect? I suspect that the answer is no.
Lord Freud
Take-up of pension credit guarantee credit, which is aimed at the poorest pensioners, is already high at 82%. However, I think that it would be better if I offered to write to the noble Baroness on the exact nature of the evidence which I do or do not have. Actually, I do not need to write because I can tell her that her second supposition is correct. We do not have any evidence either way. With that covered, I ask her to withdraw the amendment.
Baroness Hollis of Heigham
My Lords, I am not going to pretend that I am not disappointed with the Minister’s reply. I thought that he showed a degree of sympathy and understanding in Committee, particularly of the plight of older pensioners in their late 70s or their 80s, or perhaps older still, who are getting increasingly frail and confused. I thought he understood that. That is why in this amendment I dropped the idea of periodic assessments and simply suggested that, while the Minister does what he thinks is appropriate or is required to do on this in terms of having annual means-testing until the age of 75, at least from 75 onwards he could abandon the annual means-testing system.
I really do not think that the Minister has addressed the issue. He said, first, that he thinks that the savings would be reduced by 30%. I suspect that that is a slightly arbitrary figure, arrived at by dividing the number of years and the percentage of savings, but it takes no account whatever of the fact that means-testing will already have excluded pensioners at an earlier stage. I suspect that at least half his savings will come from the fact that pensioners do not claim what they are entitled to, rather than them not getting what they otherwise would by having annual means-testing.
The Minister said that if those under 75 were annually means-tested but those over 75 were not, that would give rise to appeals and disputes. What evidence does he have for that? After all, we have had periodic means-testing since 2008. How many appeals have there been from people under the age of 75 against the “no further means-testing at 75” rule, and what has been the result of those appeals? I shall give way to the Minister. He ran that argument, so I presume that he has some statistics for us.
Lord Freud
I shall have to supply the statistics separately and will do so in writing.
Baroness Hollis of Heigham
My Lords, forgive me, but trying to persuade the House that this would generate appeals and disputes and not presenting to noble Lords what is already a firm basis of evidence from the existing situation does not seem acceptable. I rather doubt that the Minister has more than a couple of handfuls of cases but we will see when he digs out his statistics. I just do not think that it is a valid argument and I have not had a shred of evidence from him or the Box to support it, although I have plenty of anecdotal evidence to the contrary.
However, my deepest concern—and it is one that I do not think the Minister has addressed—is just how profoundly unfair this is. I am baffled that he does not seem to accept that argument. He is quite deliberately building means-testing out of the new state pension, and I welcome that wholeheartedly. However, every reason he adduces for building it out of the new state pension applies equally for not continuing to means test after 75. Every argument that supports the new state pension works to support the amendment and not continuing means-testing after 75. If means-testing is so innocent, why get rid of it in the new state pension? The Minister knows, as we all know, on the basis of good and effective DWP research, that means-testing is loathed by pensioners and they do not take up the benefits they are entitled to. That is what the Minister is counting on for his savings and it is profoundly unfair.
Pensioners slightly younger are built out of means-testing because the whole lot of pension credit has been thrown out of their new state pension. One day older and they are not only going to be means-tested but means-tested annually until the day they die, until they are 90. That is shameful. The Minister is widening the gap between younger pensioners, who will be much better off and with no means-testing, and the pensioners who will be staying with the old system, who are already older and poorer and who will have a lower pension and face means-testing. He is widening the disparity rather than narrowing it.
That is not good enough. It is not decent. The Minister is profoundly wrong on this but, given the lateness of the hour, obviously I will not seek the opinion of the House at this time of night. I will withdraw the amendment but with a heavy heart because it is profoundly wrong to widen the gap between older and younger pensioners at a time when we are trying to build means-testing out of the system and the Minister is reinforcing it back in again. I beg leave to withdraw the amendment.