Pensions Bill [HL]

Baroness Bakewell Excerpts

Tuesday 15th February 2011 Lords Chamber

[Baroness Bakewell]

My Lords, I want to contribute to this debate about the Pensions Bill from an entirely different angle. I have listened with fascination to, and taken note of, the forensic analysis of its clauses. I declare an interest; for almost two years, I was the government-appointed voice of older people. In that time I received hundreds of letters, and it is those voices that I bring with me to the Chamber. I regret to say that I did not have many letters of complaint from the judiciary.

The terrible news this morning from Health Service Ombudsman, Ann Abraham, which detailed the shocking treatment of old people in some national health hospitals, indicates the need for a total rethink of how we regard the old. We all know that populations are ageing. We should celebrate that fact as it is a major achievement in human development. Advances in medicine and hygiene, and the triumph of lifestyle changes such as the decline in smoking, have converged to make a major change in my life expectancy and that of everyone else. The human race is living longer. By 2050 the number of people around the planet over 65 will have doubled. This change is on a par with climate change, and will interact with climate change to shape the future of life on this planet.

Rather than see the phenomenon as a wretched burden on society, we should welcome the old as a major new resource: an extra generation fit enough to work longer and contribute to the economy that supports them, as well as a major market for new technologies and services that promote well-being, independence and social interaction. That is the good news.

The bad news, which today's report on old people's health endorses, is that we are far from seeing the old as valuable, often capable and willing to work, planning carefully for what they expect their retirement to bring, and deserving of the same dignity and respect as the rest of society. From now on, issues concerning the old—their employment, housing, social care and transport—will come for consideration before your Lordships again and again. The planning of pension provision is merely a very important and leading adjustment that all of us will have to make to these sensational changes.

It is important that we get the emphasis and the attitude right from the start. The default retirement age is already on the way out. If older people wish—and many do—they may stay in work for as long as they are able and needed. They will be needed. The economy cannot support a population most of whom spend one-third of their lives in state-supported retirement. Planning must be overarching. Let us consider the numbers. In May last year, nearly 12.5 million people were claiming state pensions. The UK spends 5 per cent of its GDP on pension benefits, which is less than most other countries in Europe.

The names of Lloyd George and Beveridge have bounced around the Chamber today. William Beveridge advised Lloyd George on the first old-age pensions. Your Lordships will remember that when later he advised on national insurance in 1942, he listed the then five great evils: want, disease, ignorance, squalor and idleness. Times have changed. If Beveridge were to come back and address issues facing the old, he might well suggest five new giant evils. I believe that they are poverty, isolation, discrimination, injustice and neglect. Three of those considerations converge in the provisions of this Bill: discrimination, poverty and injustice. We would do well to consider them closely, for they will occur again as we struggle to deal with the unprecedented social change that is upon us.

On discrimination, 25 years after the Equal Pay Act, whose intentions we now know have not been fully realised, I little thought to find women confronting a brand new form of discrimination. I thought that the public will had moved on and that the very suggestion that such a new discrimination could happen would be howled out of court. Yet such discrimination exists in accelerating the extended pension age to 66 by 2018 in the interests of righting another discrimination, which we acknowledge existed when women were allowed to retire at 60 and men had to wait until 65. That was discrimination and we are pleased to see it go, but not when another discrimination is brought in to make it possible.

We know why this arises, and it is very understandable. It arises because the trajectory of a woman’s life differs from that of a man’s. It almost cannot be otherwise. For the best of all possible reasons—reasons applauded by society—women who are now in their fifties took a break from their working/earning lives to bring up their children. Society applauds such a move. It required their making financial sacrifices at the time, but those sacrifices were made willingly and within their own capacity to plan and anticipate their family finances. The Bill penalises them for doing that. It confronts them with having to wait longer than they thought before they get their pension and with little time or resource to do so. It is not just women who recognise that as discriminatory.

The next great evil facing the old is poverty on a very wide scale. A higher proportion of women in the workforce have low-earning jobs. Pensioners from black and ethnic groups are more likely to be in poverty than white pensioners. Forty-nine per cent of Pakistani and Bangladeshi pensioners already live in poverty. Many women, as we have heard, struggle to do several jobs over the same schedule in order to provide for their families: their existing earnings are at a stretch. They may well be caring for both a younger generation—their own children—and an older one, their ageing parents. They are caught in a generational bind. Yet some of them—33,000, according to the Minister’s own figures—face the sudden prospect of needing to fund up to a two-year delay in their entitlement to a state pension. They must wonder how they are to do that and how that situation arose. There is no scope, no space, no time and no opportunity to earn a little more or to set even a little aside each week to ease that transition. They face the gentle but implacable squeeze of poverty. Up to 2.6 million women will be affected by the additional time they have to wait for their state pension.

The third evil is injustice. Many of the old are already seized by a fear of what lies ahead. They sense that they are getting a raw deal. I receive letters all the time in which the same phrases are used: “I have worked hard all my life. I have paid my taxes. I have cared for my family. I have taken hardly any holidays. And yet now I am to be hit by this pensions ruling. It just isn’t fair!”. There is widespread bitterness among many old people that the young have no idea and simply cannot imagine how anxious and distressed old people are at not being treated justly. There is alarm among them that many younger people think that the old have never had it so good and have lived lives of comfort and ease, while they struggle with changing financial pressures. But there are millions of older people who have led steady, responsible lives, caring for their families, honouring their communities, and they expect to be treated justly as society adjusts to the changing demographics.

As I said when I began, the old are increasing in number and they are alert, active, thoughtful and outspoken. They are looking to this Bill to help society to adjust to the changing demographics. They feel that they are in a van of social change and yet they are the victims of it. When making changes to the Bill, I ask the Minister to consider those injustices and discriminations against women and the poor.