Pension Review: Phase 2
Debate between Baroness Sherlock and Lord Palmer of Childs Hill(1 month ago)
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Baroness Sherlock (Lab)
I fully accept that the noble Baroness may not be alone in this place in that declaration of interest. The ombudsman’s review is something to which the Government have already made their response. It was published yesterday, and I repeated a Statement in the House that was made by my right honourable friend the Secretary of State.
As noble Lords will be aware, the Government looked very carefully at the evidence that was provided to and by the ombudsman, and we concluded that while we accept the specific case of maladministration by allowing a 28-month delay in sending out personalised letters to women born in the 1950s, the Government could not accept that that created the impact the ombudsman had described and therefore could not accept the recommendation on injustice and remedy. I am also very aware of the widespread concern among many women who had hoped to retire at 60 and found that they could not, which is a mixture of the decision back in 1995 to equalise the state pension age and the decision of the coalition Government in 2011 to accelerate those changes. That was not a subject of the ombudsman’s review, and nor is it the subject of the pensions review.
Lord Palmer of Childs Hill (LD)
My Lords, the Minister talks about the two stages of the pensions review, which is very important. Can she confirm that the modelling by the Government Actuary—and I stress that—shows that the measures in stage 1 of the pensions review will, at best, only slightly improve member outcomes? Those are his words, not mine. Can she give me some reassurance that stage 2 will be given the priority it deserves? Can we get a timescale for when we will get to stage 2? I know the Minister cares about pensioners, and this review is necessary.
Baroness Sherlock (Lab)
I thank the noble Lord. We share that; we both care about pensioners. This Government are absolutely committed to making sure that outcomes for pensioners from private pension savings are as good as they can be. Both phases matter. It matters absolutely that we get the pensions market working properly the first time around. The noble Lord will be aware that measures have been announced for the pensions Bill, but there are live consultations on a range of measures that can enhance both growth for the UK and outcomes for savers.
It really matters. We want to end up, as our proposal suggests, with fewer, but better and bigger, pension schemes. All the international evidence suggests that consolidation and scale produce better results for savers. That, in the end, is what will drive private pension incomes. If we can get the market working well, we can try to get people saving as much into it as they need to.
State Pension: Age Increase
Debate between Baroness Sherlock and Lord Palmer of Childs Hill(2 months, 1 week ago)
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Baroness Sherlock (Lab)
My Lords, life expectancy is increasing, but the rate of increase is slowing. Built into the Pensions Act 2014 is a requirement on the Secretary of State periodically to review the state pension age, taking into account life expectancy and a range of other appropriate factors. There have already been two of those reviews. The next one has to happen by March 2029, I think. I have no doubt that the Secretary of State will take account of precisely those matters.
Lord Palmer of Childs Hill (LD)
My Lords, does the Minister agree that we do not want a repeat of the WASPI women scandal? We have been here before. If individuals are not properly informed about the change to their state pension age, will the Government consider introducing a clear appeals process or a safety net to ensure that no one is financially disadvantaged due to a lack of information? From past experience, we know that there will be many people who fall through the net, and we need to have an appeals process in place.
Baroness Sherlock (Lab)
My Lords, it is crucial that everybody gets to know their state pension age, but the reality is that there are a lot of different ways in which people do that. I already knew that my state pension age was increasing. A lot of that was simply from information in the news and on television. One of the ironies is that, when I was first briefed about this, I was told that the department had written to everybody in that age category. I said that I had no recollection of receiving such a letter, but I was assured that it had happened. Last weekend, I moved house and, when I opened a folder of unfiled papers, what was sitting on the top but a letter dated February 2018 telling me that my state pension age would be 66 and two-thirds. The point is that different people receive information differently. I am of an age where I get most of my information on my phone, from which I am rarely parted, and from news consumption. We have to use every possible means of communicating to make sure that people get the information out there.
Social Security Advisory Committee: Winter Fuel Payment
Debate between Baroness Sherlock and Lord Palmer of Childs Hill(2 months, 1 week ago)
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The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Sherlock) (Lab)
My Lords, I thank the noble Baroness for her question. I am sure she is aware that the Secretary of State has replied to the Social Security Advisory Committee and has placed a copy of that on GOV.UK. She has gone through all the points raised by the SSAC and responded to them in detail, so I commend that to the noble Baroness. If noble Lords would like to ask any questions, I am happy to respond to them specifically. The department has a good working relationship with the SSAC. We welcome its observations and comments, and we always listen to the points it makes. It will be no different on this occasion.
The noble Baroness raised questions of housing benefits and costings. Final costings for the changes were certified and published by the OBR at the Autumn Budget and take account of any behavioural responses and the estimated number of people claiming pension credit in the upcoming years. I stress that if more people who are entitled to it claim pension credit, that is a good thing. It means that those people will get approaching £4,000 a year rather than or in addition to the winter fuel payment.
On the question of housing benefit, the judgment was made not to make housing benefit in itself a qualifying benefit, because it is based not only on financial circumstances but the amount of rent. As the noble Baroness will understand only too well, households that get housing benefit can go higher up the income distribution than those that get pension credit. That can be true even if they get the maximum, because of the way earned income is treated. We also have to take account of fairness between those who are renting and those who are paying mortgages. I presume that is why, when the previous Government did cost of living payments, they did not choose housing benefit as a qualifying benefit. I imagine it was for the same reasons.
Lord Palmer of Childs Hill (LD)
My Lords, following the Minister’s reply, the Social Security Advisory Committee recommended that the Government consider bringing forward an urgent amendment to the regulations which would, for this year only, very modestly passport those in receipt of the full rate of pensioner housing benefit on to winter fuel payments. It is a very modest request. Will the Government take that advice?
Baroness Sherlock (Lab)
My Lords, I think I have answered the point about housing benefit and explained why the Government took the decision we did. However, we are determined to do everything we can, so we are directly contacting approximately 120,000 pensioner households that may be eligible for pension credit, to encourage them to make a claim. We are also writing to all pensioners to make sure they are aware of the changes coming forward and to link them to where they can claim pension credit if they are entitled to it.
Health-related Benefit Claims
Debate between Baroness Sherlock and Lord Palmer of Childs Hill(2 months, 2 weeks ago)
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Lord Palmer of Childs Hill (LD)
My Lords, does the Minister believe that the reason for health-related benefits claims is the state of the health service, including people’s access to their GP for a face-to-face appointment? If we do not deal with that, we will not deal with health-related benefits. What are the Government doing to pursue those aims?
Baroness Sherlock (Lab)
My Lords, the noble Lord points out another of the contributory factors. A complex web of things brings people to this point. As far as we understand it, a number of contributory factors are driving the rise in health-related benefits. Disability has gone up in prevalence over the last 25 years, including a rise in mental health issues. Also, longer NHS waiting lists are thought to increase claims for benefits before people are treated, because they are waiting longer, and potentially after they are treated, because they have poorer outcomes as a result of problems in the National Health Service.
This Government are absolutely committed to fixing our NHS. We have seen record investments, and the plans that came out in the Budget mean that we are absolutely committed both to engaging directly in supporting the NHS and to tackling some of these problems. As part of “Get Britain Working”, we will have trailblazer areas across England and Wales bringing together health, employment and skills services. In three of those areas, money will go to the NHS to develop evidence on how the health system can prevent ill-health-related economic activity. We are going to sort this.
Pension Credit
Debate between Baroness Sherlock and Lord Palmer of Childs Hill(2 months, 2 weeks ago)
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Baroness Sherlock (Lab)
My Lords, on that final point, which, obviously, I cannot let go, the poorest pensioners are protected because those on pension credit will still have access to the winter fuel payment.
On the bulk of the noble Baroness’s question, we continue to operate good service levels. Around 500 additional staff have now been brought in to support processing during the recent surge in pension credit claims. Processing times may increase; we have advised customers who apply that it could take nine weeks to process their claims. However, anyone who applies before the deadline of 21 December can have their application backdated, which means not only that they will get winter fuel payments but that they may well get pension credit on top of that.
Lord Palmer of Childs Hill (LD)
My Lords, I compliment the Minister on the work being done to make people claim pension credit they should have claimed before, in order to try to make up for the rather strange removal of the winter fuel allowance. Can she tell the House when—if we have not reached this point already—the amount of pension credit that was not being claimed before is going to exceed the amount notionally saved from the winter fuel allowance? If that point has not yet been reached, when will it be reached?
Baroness Sherlock (Lab)
My Lords, I was so with the noble Lord for the first 20 seconds—all the way. I am grateful for his congratulations to the department, and I shall take them back to my colleagues, who are doing a brilliant job on this front. We have written to around 12 million pensioners about the change to the winter fuel allowance, so a lot of work has been done out there to encourage people to apply—and it is having an effect. We have seen a 152% increase in pension credit claims received by the DWP in the eight weeks following the announcement on the winter fuel payment compared to the eight weeks before, and that will be updated towards the end of the month.
On the costs at the end, obviously, a lot of these claims have to be processed and we will not know for some time down the road. However, it is very clear that the DWP wants everybody who is eligible to do so to claim pension credit. As I have said before, if we end up with more people claiming the money to which they are entitled, that is a good thing. Pensioners deserve the money to which they are entitled.
Child Poverty: Benefit Cap
Debate between Baroness Sherlock and Lord Palmer of Childs Hill(3 months ago)
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Baroness Sherlock (Lab)
My Lords, the Secretary of State is currently in the process of reviewing the levels of social security benefits that are uprated annually, and a statement will be made in due course. When the benefit cap was introduced by the coalition Government in 2013, the legislation required that it be reviewed every five years. The next review is due by November 2027. However, I hear my noble friend’s comments about the challenges facing many families in poverty. The child poverty task force, which is getting to work already, is determined to use all available levers to drive forward short-term and long-term actions across government to reduce child poverty. It is taking evidence from families, activists, local government and people across the country, and I will make sure that her comments are conveyed to it.
Lord Palmer of Childs Hill (LD)
My Lords, I welcome the Minister’s comments about the child poverty task force, but it is an urgent question and this idea is putting things into the long grass. We want to hear from the Minister how quickly this group will report and produce some action to stop children living in poverty in this country.
Baroness Sherlock (Lab)
My Lords, as I said, the child poverty task force has already started urgent work to address this, and it will publish a child poverty strategy in the spring. Given that the Government have not been in place for very long, looking across the whole of government to produce a strategy by spring reflects a real sense of urgency.
Pension Credit
Debate between Baroness Sherlock and Lord Palmer of Childs Hill(4 months, 2 weeks ago)
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Baroness Sherlock (Lab)
My Lords, the pressures were such that some of the money had to be found in this financial year, because a series of expenditure gaps came to light in this financial year. We have already cut other capital programmes, and departments are absorbing pressures. This was a cut that could be made in-year, so it was added to it.
I am sorry to say that this is not the last difficult decision this Government are going to be forced to make, but we will try to target things appropriately. I think most Members of the House would agree that something like a winter fuel payment should not be going to the roughly quarter of pensioners who have a million pounds in assets; it should not be going to those who can manage. What we should be doing is trying to target the money at those who need it most, and that is what we set out to do.
Lord Palmer of Childs Hill (LD)
My Lords, the Minister has talked about encouraging people who are entitled to pension credit to claim it. Does she agree that they do not claim it for reasons of pride, or perhaps because they are unable to cope with the system? How are the Government going to encourage this large number of people to claim pension credit, because if they do not, they will not have the winter fuel allowance? I have doubts that people will actually claim it to any great degree.
Baroness Sherlock (Lab)
The noble Lord makes an important point and I am grateful to him for doing so. Certainly, a significant number of pensioners do claim pension credit—1.4 million have managed to claim and do get it as a result. So, our job is to get the next surge of people to do that. DWP has a big campaign on: we had a week of action last week, and we work with partners such as charities and local authorities to go out and promote the campaign. From next week, we are running a national marketing campaign on a range of channels, including national print and radio. We will be targeting people of pension age but also friends and family, who can encourage them to apply. It can be tough, but sometimes we need to make people understand that there is lots of help out there. They can call the department free of charge and get charities to help them. If people are really stuck, we have a DWP home visiting team, which will visit the vulnerable and help them make a claim. So I urge all noble Lords: by all means let us have the fight in here, but please put the word out and let us get people to claim what they are entitled to.
European Social Charter
Debate between Baroness Sherlock and Lord Palmer of Childs Hill(4 months, 2 weeks ago)
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Baroness Sherlock (Lab)
My Lords, in a sense we have indicated our support for the contents of the revised charter by signing it. Deciding to ratify it is a decision to be bound by its provisions, so it makes sense to be able even to consider ratification only at the point at which the Government have been able to do an assessment and conclude that domestic law and practice will be compliant with it.
Lord Palmer of Childs Hill (LD)
My Lords, as I understand the Minister’s reply, the Government want to ratify the treaty only when and if there are adequate resources. On the basis of adequate resources, can she say what steps her department has taken to maximise the take up of pension credit by all those entitled to it?
Baroness Sherlock (Lab)
Nice try. Just to clarify, I should say that I was not talking about resources in terms of ratification. To ratify a treaty is to agree to be bound by its provisions. If UK domestic law and practice will not meet those provisions, the UK cannot ratify a treaty only to find that it would be instantly in breach of it. That is what this is about; it is not about resources. However, on the question of pension credit, we are in the middle of a week of action in which the Department for Work and Pensions is working with local authorities and other partners to encourage pensioners across the country to apply for pension credit. We are developing new plans to go further through the winter. We want everybody who is entitled to it to get pension credit, and will be out there working to make sure that they do.