Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2021

Baroness McIntosh of Pickering Excerpts

Thursday 25th February 2021 Lords Chamber

[Baroness McIntosh of Pickering (Con) [V]]

My Lords, I am delighted to follow the noble Lord, Lord Hain, and thank him for his part in introducing auto-enrolment. I join others in welcoming the order and congratulate the Minister on bringing this forward. With her, I also celebrate what we have achieved so far with the auto-enrolment scheme. I have a couple of questions.

My first concern relates to the impact on small businesses of the increase set out in paragraph 12.2 of the Explanatory Memorandum, which states:

“Due to the changes, private-sector employers will pay an estimated £5 million more in employer pension contributions in 2021/22 than they would have done had the thresholds been uprated in line with earnings.”

Can my noble friend say what the impact of the crisis will be on SMEs? How have the Government borne in mind the impact of Covid-19 on the performance of many companies, particularly small and medium-sized companies, during the ongoing pandemic?

I would also like to raise the plight of women workers, particularly exacerbated in the circumstances of Covid, and their ability to save for pensions. Women are now required to work until 66 years of age, yet the pandemic has removed many of these women from employment opportunities and placed them at greater risk of vulnerability, catching infection and being seriously ill from it due to age. Many may be shielding older or younger relatives and have caring responsibilities. That is one issue facing older women who are not yet of retirement age or who are unable to afford to retire and continue to work, but the job opportunities are not there.

Within this category of women I would like to look at women of all ages, and actually all workers, who may have more than one job. We are told that each job is treated separately for the purposes of auto-enrolment pensions. Some jobs will sign a person up to pay into a pension automatically; others will not. We are told an individual can pay into more than one pension, but charges will apply. It may be that you pay two sets of charges if you have contributions to two separate pensions. Have my noble friend and her department had the opportunity to look at this category of women who are caught out in this regard? It would be ideal if people were in full-time positions, but many do not have the opportunity and have to work part-time in more than one or two positions just to make ends meet. Many in this category, women and men, may be reliant on temporary and zero-hour contracts.

It is notable that the Office for National Statistics confirmed there has been an 11% increase in unemployment in women over the age of 65 who have not chosen to take a pension or perhaps do not have one. I would be delighted if, in response to my remarks and questions, my noble friend could write to me if she is unable to answer them today. I will be supporting the order, but I have these concerns.