14:55 - The House divided: - Ayes: 158 / Noes: 0 - Question accordingly agreed to.
Mhairi Black
It is noticeable, and a pity, how few Conservatives have turned out.
It is important to highlight that the Government did not send out a single letter to women. There was no official correspondence between the Government and the individuals affected, alerting them to the changes that were going to happen to them. Even the previous Pensions Minister, Steve Webb, recognised that not everybody knew that the changes had happened in the 1995 Act.
A response to a freedom of information request states that the Department eventually wrote to individuals affected and that
“Mail campaigns took place between 2009 and 2013.”
That is 14 years after the 1995 Act. Women were not personally notified by anybody official until 14 years after the changes came in. That is 14 fewer years that women have had to prepare and to try to make alternative arrangements.
The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on managing to secure this debate, which has attracted many Members on both sides of the House. I also commend all the colleagues who have taken the trouble to come here and speak today. I will try to address as many of their points as I can in the limited time available to me.
I should like to begin by reminding the House of the rationale for reforming the timetable. For our state pension system to function effectively, it has to be fair, affordable and sustainable. The changes made to the state pension age under the Pensions Act 2011 make an important contribution to achieving those aims. Gender equality is one of the main purposes of the changes to the state pension age. Under the previous system, women reaching state pension age in 2010 would spend on average 41% of their adult lives in receipt of the state pension. For men, the figure was only 31%, owing to the longer life expectancy and earlier state pension age of women.
It makes little sense for women to work to a pension age originally set in 1940 which does not reflect the employment opportunities open to them in a modern society. Changes were needed to take account of increased life expectancy and to ensure fairness for working-age people who would otherwise bear the cost of this longevity. Following sharp rises in life expectancy, the previous Government acted to address this and brought forward the timetable for rises in the state pension age. This was vital if we were to continue to meet the UK’s obligations under EU law to eliminate gender inequalities in social security provision and to ensure that the state pension remained affordable and sustainable. It is also important to look at the changes in the context of our wider pension reforms and what these mean for women.
Barbara Keeley
The Minister cannot have been listening to what I said earlier. A substantial proportion of what I said showed that that is not the case, although he and his colleagues are hiding behind that argument. We were not required to do that. Some EU countries are not equalising until 2040 or 2044, and some are maintaining a difference. Will he please stop hiding behind something that is not true?
Mr Vara
I will not give way. I am mindful of the limited time that I have, and I am keen to ensure that the proposer of the motion, the hon. Member for Paisley and Renfrewshire South, has time to make her concluding comments at the end of the debate.
The introduction of the new state pension will benefit many women who would have lost out under the current two-tier system, largely as a result of lower average earnings and part-time working. All those affected by the 2011 changes will reach pension age after the introduction of the new state pension. Around 650,000 women reaching state pension age in the first 10 years will receive an average of £8 per week more under the new state pension than they would have done under the previous system. The majority of households reaching state pension age up to 2030 will receive a higher total income over retirement under the new system.
The solution to ensuring that people have a comfortable later life is encouraging and enabling them to work longer. This benefits individuals through the social and financial rewards of employment, it benefits employers through the skills and experiences that older workers bring to the workplace, and it benefits the wider economy. Research by the National Institute of Economic and Social Research has shown that adding just one year to people’s working lives would add 1% to UK GDP per year.
Support is in place to provide extra help for people who cannot work owing to caring responsibilities, ill health or disability. Women affected would be eligible for the same in-work, out-of-work or disability benefits as men of their age, and carer’s allowance may be available, for which national insurance credits are awarded automatically. In 2011, credits were introduced to help adult family members looking after a child under 12 in order to assist the parents who were working, with these credits being able to count towards state pension entitlements.
Much has been made of the comments made by the previous Pensions Minister, Steve Webb, and it is important to recognise that even he was not seeking a restoration that would cost £30 billion. Indeed, he said that he was only looking for a 10% clawback. It is also worth remembering that he does recognise that the £1.1 billion concession that was made was generous. His exact words were:
“and we got £1 billion back in the end, and a billion quid is a serious amount of money.”
Nick Thomas-Symonds
I am grateful to the Minister for being so generous in giving way. He read out the quote about £1 billion being a “serious amount of money”, but he really should have quoted the whole sentence, which begins:
“this was a measure to save 30 billion quid over how many years, and we wanted 10% of that back to soften the blow”.
Steve Webb wanted £3 billion back but got only £1 billion.
Mr Vara
If the hon. Gentleman had taken the trouble to listen while he was preparing his question, he would know that that is what I said, except that I used different words. He might want to check the Hansard record tomorrow morning. In this place, it always helps to listen before speaking.
The Government listened to the concerns expressed during the passing of the 2011 Act, and shortened the delay that anyone would experience in claiming their state pension, relative to the 1995 timetable, to 18 months. That concession benefited almost a quarter of a million women, who would otherwise have experienced delays of up to two years. A similar number of men also benefited from a reduced increase. The concession was worth £1.1 billion in total, and as a result 81% of women affected will experience a delay of 12 months or less.
Mhairi Black
To me, the concessions that were given show that the Government recognise that the transition was not appropriate. Given that the wording of today’s motion is clear in asking the Government to reassess the transitional arrangements, will the Minister confirm that he will do so if the motion is passed, be it unanimously or with a vote—yes or no?
Mr Vara
I have only a short time left and I must press on.
As for people being aware of the 1995 changes, I should add that research carried out in 2004 by the Department for Work and Pensions found that 73% of people aged 45 to 54 were aware of the changes to women’s state pension age. It is regrettable that people have sought to put this on a political basis and have conveniently forgotten that after 1995 we had 13 years of Labour government. I have here a list of some 10 Labour Pensions Ministers who totally failed to do anything, yet Labour Members conveniently seek to put the blame on the things that have happened post-2010. The shadow Home Secretary made comments earlier, but he was a Labour Cabinet Minister, and the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson), who also made comments today, was also in the Labour Administration. He is a former Pensions Minister, yet he did nothing then.
Alan Johnson
Indeed, I was the Work and Pensions Secretary, but we introduced measures that did not include this anomaly—it was introduced in 2011.
Mr Vara
The right hon. Gentleman spoke earlier of being lobbied, but he took no action on that. Furthermore, big issues arise as to whether notice was given in respect of the changes in 1995, and when he was Work and Pensions Secretary he did nothing to make sure that those women were informed. All the blame has been put on Conservative Members.
I wind up simply by saying that this matter was debated thoroughly and properly in 2011. A concession was made then—by way of time period and financially—which was worth more than £1 billion, and it was thoroughly debated in both Houses of Parliament. I very much hope that I have put the Government’s position on the record. I simply say to some people that they, too, should learn to take responsibility, given that they were in government for 13 years. With that, I shall allow time for the hon. Member for Paisley and Renfrewshire South to speak.