Women’s State Pension Age Communication: PHSO Report

Baroness Humphreys Excerpts

Tuesday 17th December 2024 Lords Chamber

[Viscount Younger of Leckie (Con)]

My Lords, it looks like we have the graveyard slot this evening. I am very sorry indeed that the House is so empty for such an important and serious subject. In fact, it feels more like a bilateral session—or perhaps I should say trilateral, if we bear in mind the Liberal Democrats. However, I thank the Minister for repeating this Statement made earlier in the other place. On this side, we are acutely aware of the long-running campaign by the WASPI women. The decision made today by this new Government will be a great, and in some cases devastating, disappointment for them.

We understand the strength of feeling on this. The Minister will not need reminding that in March the previous Government responded to the long-awaited report by the ombudsman, the PHSO, and I recall repeating the Statement in this House. The House should be reminded that it took well over five years for the ombudsman to produce its final report—the result of an investigation spanning over 30 years. When the report came, as the Statement outlines, the ombudsman took the unusual step of laying the report in Parliament and asking Parliament to make decisions in respect of remedy, instead of making recommendations itself. So here we are today with the remedy made by this Government.

I say at the outset that we take considerable offence at the right honourable Secretary of State for Work and Pensions in the other place politicising this. She said this afternoon that her Government would make the decisions in reference to the WASPI matter when the previous Government were not prepared to make them. This is unbecoming, and the Minister knows full well that it is simply incorrect. Will she agree that when the PHSO report was published in March, any Government would have needed the time to reflect on it? The election, she will know, was called in June, and back in March we said we would provide a report to the House once we had considered the findings. Where are we now? Is that not exactly what this Government have done? Will the Minister acknowledge this?

In making the decision that

“there should be no scheme of financial compensation to 1950s-born women”,

the Government have repeated their long-playing record on their economic inheritance, as I heard in the other place earlier today. Can the Minister confirm how much of today’s decision—her Government dismissing the significance that the ombudsman placed on the delayed letters sent to the women—was based on this, and how much was based on the Government’s own analysis, from the PHSO report, that the case of the WASPI women was weak?

I am glad that the Government have taken responsibility for the events that occurred on the last Labour Government’s watch—namely, for the decisions made between 2005 and 2007. They led to a 28-month delay in sending out letters, which the ombudsman identified as maladministration. As I said earlier, while I am sure that the Government’s Statement today will be a disappointment to many WASPI women, I understand why they have taken this decision. As the Minister said, paying a flat compensation rate to all women at a cost of up to £10.5 billion would not be a fair or proportionate use of taxpayers’ money.

On lessons learned, can the Minister tell us more about the action plan that the Government are working on with the ombudsman? What are the timings, and will it be published? That would at least give some comfort to those involved. If the Chancellor deems that future economic circumstances allow it, will the Government rethink their policy? Is this a temporary decision made in respect of the WASPI women, or is there a plan at any stage in the future to look to a financial remedy? That is a very interesting point.

Have the Government made any assessment of the number of women whose cases are strong? If not, why not? Why have they decided not to pay compensation to this cohort at least? Can the Minister explain how they are going to communicate this devastating news to the WASPI women individually, estimated to be in excess of 3 million, beyond the Statement issued today? What actions will the Government take to support the women, including some necessary pastoral or mental health assistance? Is there a plan? Given that the Government have not agreed with the ombudsman and have overridden some of its views in the report, such as disagreeing with the importance attached to the non-arrival of the letters, how much confidence do they now have in the ombudsman?

In a letter from the Minister to all Peers received today, for which I give thanks, she writes:

“Even taking the difficult decisions we are faced with in government, we feel a deep sense of responsibility to ensure that every pensioner gets the security and dignity in retirement that they deserve”.


I say quite so, and warm words indeed, but does she really mean this? I have to contrast it with the Conservative’s support for pensioners—the action on the ground. This includes introducing and protecting the triple lock, which has seen the state pension increase by £3,700 since 2010, meaning that there are now 200,000 fewer pensioners living in absolute poverty. The Conservatives introduced pension reforms, ensuring that everyone is automatically enrolled in a workplace pension scheme. The Conservatives introduced the winter fuel payment, ensuring that no pensioner has to live in a freezing cold home.

I suspect the House will know where this is leading. This announcement is another blow—one of many that have hit pensioners since 4 July. Regarding the Government’s decision to cut the winter fuel allowance, can the Minister update us on the actual numbers of pensioners who have taken up pension credit, not just percentages? Is she comfortable with the current pension credit uptake numbers? How is this affecting the £1.6 billion announced and the expected saving for the Treasury resulting from the cut in the winter fuel allowance?

With these myriad questions, I look forward to the Minister’s responses on another very difficult day for the Government.

[Baroness Humphreys (LD)]

My Lords, today will be a day of disappointment for many women. They will feel that this new Government, by ignoring the independent ombudsman’s recommendations, have turned their back on the millions of pension-age women who were wronged through no fault of their own. That has to be of concern.

Liberal Democrats have long backed calls for women born in the 1950s affected by the pension changes to receive proper compensation for the Government’s failure to properly notify them of the changes, and have long supported the ombudsman’s findings. Today’s announcement is a hammer-blow to these women, who have fought tirelessly for many years to be properly compensated. I appreciate that the Government have had to make difficult decisions, but have they chosen to ignore the PHSO’s recommendations because they disagree with the findings or because they do not want to find the money to rightly compensate these women?

The PHSO’s ruling in March recommended that some women should get a payout and an apology. Obviously today they have received an apology, but they will not receive a penny of compensation for the maladministration found by the PHSO. Will the Minister outline why the Government have chosen to accept one half of the recommendation but not the other?

One WASPI woman dies every 13 minutes while this appalling scandal continues. Today’s announcement will be devastating for the WASPI community, which has campaigned tirelessly to rectify the maladministration. Does the Minister really think that today’s announcement is a fair solution?

Finally, in her letter to us today, and in the Statement, the Minister promises that this Government will protect the pensions triple lock, so that the yearly state pension is forecast to increase by up to £1,900 by the end of this Parliament. I welcome this promise. The pensions triple lock was a Lib Dem policy adopted by the coalition Government and I am proud of it, but this will be advantageous to all pensioners, not merely the WASPI women. Sadly, it in no way compensates these women for their losses. My colleagues in the other place have promised that they will continue to press Ministers to give those affected the fair treatment they deserve.

[Baroness Sherlock (Lab)]

My Lords, I thank the ombudsman for the considerable work that went into producing this report. The issues it raises are complex and I am grateful that we have time to discuss them this evening, though I share with the noble Viscount the wish that we had more people here while we do it. I would always rather discuss these things with a wider audience.

I thank both noble Lords for their responses. Before I engage with the specific points that they raised, I want to say a few more words about the background to this. The noble Viscount began by, in essence, attacking my colleague the Secretary of State for politicising the issue and then went on to politicise it himself. Therefore, we can either do that—we can take it in turns to point at each other—or we can try to address the issues. I am going to try to do the latter.

We have been looking seriously into the issues raised since we came into office in July. That work has involved looking at what Parliament has said, examining the evidence submitted to the ombudsman, meeting the interim ombudsman and listening carefully to the views expressed by the women affected. We listened, we read, and we reflected before coming to a decision.

The most important thing, to start, is to be clear about what exactly the ombudsman investigated. The ombudsman did not investigate the decision, first taken in 1995, to equalise the state pension age for men and women. I know that many women have strong feelings about that change, particularly the decision taken by the former Government—the Conservative/Liberal Democrat coalition Government—in 2011 to accelerate the changes sharply, which made a significant difference to a number of women. That was a policy that Labour opposed at the time, but the policy was agreed by Parliament, maintained by subsequent Governments and upheld in the courts. It is not the issue at hand today.

What the ombudsman did investigate was how the change of the state pension age was communicated by DWP to the women affected. I can see a Whip on the opposite Benches shaking his head. That is literally what the ombudsman did; I invite him to read the report. The ombudsman concluded that between 1995, when the original decision was taken, and 2004, our communications,

“reflected the standards we would expect it to meet”.

However, it found that between 2005 and 2007, there was a 28-month delay in DWP sending out personalised letters to the women affected. The ombudsman found that that constituted maladministration by the department. It argued that that led to injustice and proposed that financial remedy should be paid to those affected.

The Government accept the ombudsman’s finding of maladministration. We are sorry for the 28-month delay in writing to the 1950s-born women and we are determined to learn lessons from this experience to ensure that it does not happen again. I will come back to that.

In response to the question from the noble Baroness, Lady Humphreys, the reason the Government accepted this in part is that maladministration is about the actions that were taken at the time when things went wrong. We recognise that those letters should have been sent 28 months earlier. They were not; we apologise for that and accept maladministration. Injustice and remedy are about the consequences of those actions. Where we diverge from the ombudsman is on the impact of that failure. That is why we accepted the finding of maladministration, but we are not able to agree with the ombudsman’s decision on the approach to injustice and remedy. That is because the ombudsman had assumed that receiving those letters earlier would have changed what the women knew and how they acted, despite evidence to the contrary.

Research has shown that letters are not an effective means of communicating state pension information in the great majority of cases. Research from 2017 found that only one in four people who got an unsolicited letter remembered receiving and reading it. That suggests that sending letters earlier, as the ombudsman suggested, would not have affected what most women knew and, therefore, the decisions that they took. In other words, while we accept there was unnecessary delay in sending letters to women, we do not accept that that delay led to injustice in the great majority of cases. Given that, with the research suggesting that 90% of 1950s-born women were aware of changes to the state pension age, we cannot justify financial remedy. Paying compensation to all 1950s-born women at the rate proposed by the ombudsman, as the Statement said, could cost as much as £10.5 billion. We cannot justify paying out such a significant sum of money—taxpayer money—when the great majority of 1950s-born women were aware of the changes and therefore experienced no injustice. Writing letters to those who were unaware would not have made a difference for most.

The noble Viscount, Lord Younger, asked whether we had assessed how many women’s cases were strong. The answer is that we have not, for the reasons set out in the Statement. It is the same question, in essence, as whether we could create a targeted compensation scheme to compensate only those affected. Of course, we looked carefully at that possibility, but we concluded that such a scheme is impossible to deliver in a way that is fair and represents value for money. In fact, the ombudsman itself pointed out the challenges in doing that, as the noble Viscount will know, since I know he has read the report. It took the ombudsman, as it pointed out, nearly six years to investigate six cases.

To set up a scheme whereby the DWP would have to consider the detailed personal circumstances of as many as 3.5 million women born in the 1950s would take thousands of staff many years. In fact, we estimated that if we received claims from 60% of that 3.5 million, running a bespoke scheme would require 10 times as many staff as currently administer the state pension for all 12 million pensioners. That is the scale and the impact on the everyday running of the department.

Even more crucially, it would require us to make subjective judgments about whether giving each affected individual different information at different times would have led to different decisions and what the consequences would have been. Those are inherently difficult to consider, never mind prove, and it would be impossible to verify the claims for a scheme where someone self-certifies that they have suffered injustice. As a result, because we do not agree with the ombudsman’s approach to injustice, because 90% of 1950s-born women were aware of the changes and because it would be impossible to set up a bespoke scheme that would be fair, reliable and value for money, we cannot justify paying compensation.

I think it is worth dwelling for just a moment on the fact that this is not about the state pension age because I think that is one of the biggest challenges. We understand that that is difficult, but that decision was made in 1995 and has been settled, and I think nobody is arguing for reopening that.

The noble Viscount asked about learning lessons. The DWP is committed to learning lessons from the ombudsman’s findings so that we can deliver the best possible services in future. This case highlights just how important it is to get communication with our citizens right. We have already taken steps to make this better. We regularly engage with stakeholders and customer representatives, not just in general, but to test and provide feedback on many of the communication materials that we put out.

However, as the Secretary of State said, there is more to be done. The action plan is something that we are going to work on with the ombudsman. We will report on that in due course, and I will keep the noble Viscount informed as that work develops. We are determined to work with the ombudsman to develop an action plan identifying and addressing all the lessons this experience offers. We are continually developing our policy on communicating state pension age changes, rooted in our commitment to give clear and sufficient notice of any changes to those affected.

The noble Viscount quoted in my comment in the letter I sent to all Peers earlier today that

“even taking the difficult decisions we are faced with in government, we feel a deep sense of responsibility to ensure that every pensioner gets the security and dignity in retirement they deserve”.

I will allow myself one little bit of politics here. It is that, despite the very large hole in the finances that the previous Government left, we have none the less managed to find the money to maintain the triple lock, which will involve spending £31 billion, with the result that the new state pension and the basic state pension will go up by 4.1% next April, and in the case of the new state pension, the full yearly rate by the end of the Parliament is likely to be £1,900 higher.

The decision today does not mean that we do not understand that some women are facing financial hardship. The noble Viscount asked me for figures about pension credit. I can tell him that 150,000 people applied for pension credit in the 16 weeks following the announcement. Of those 42,000—I think, from memory, and I will write to him if I am wrong—had a successful claim. We know that at the very least there are those extra numbers of people, significantly more than there would have been in the comparable period previously, who are already getting pension credit and there may be many more. People have until 21 December to apply. Those cases that are in before that deadline will get processed and in due course those who succeed will get not only get the winter fuel payment, which is what the noble Viscount brought up, but all the benefits of pension credit itself and all the passported benefits that it brings with it.

This was a difficult decision to make. There were other questions. The noble Baroness, Lady Humphreys, asked whether we just disagree or whether it is about money. I hope I have answered that. I have set out the arguments. The noble Baroness may or may not disagree with them, but I have tried to set out the reasoning the Government did. We tried throughout this to follow the evidence. That is all that a Government can do when faced with a report such as this. We went through it incredibly carefully. It is evidence that the noble Viscount will be very familiar with. Since he was doing my job before me, he will have had it rather longer than I have. We spent the past six months going through it in detail. We have considered the evidence, and we have made what we believe is the right decision. That does not mean it was not a difficult decision, and I recognise that it will be a disappointing one for many 1950s women. It is not a reflection on their campaigning or anything else, but we feel that, despite that, it was the right decision, for the reasons I set out, and I hope that the House can accept that.