Question to the Department for Work and Pensions:

To ask His Majesty's Government what steps they are taking in response to the findings of PwC’s Youth Employment Index regarding the role of long-term sickness in driving youth economic inactivity.

Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)

Long-term sickness continues to be the most common reason for economic inactivity in the working age population. Good work is generally good for health and wellbeing, so we want everyone to get work and get on in work, whoever they are and wherever they live. Backed by £240 million investment, the Get Britain Working White Paper launched in November 2024 is driving forward approaches to tackling economic inactivity.

Young disabled people and young people with health conditions are a diverse group so access to the right work and health support, in the right place, at the right time, is key. We therefore have a range of specialist initiatives to support individuals to stay in work and get back into work, including those that join up employment and health systems. Existing measures include support from Work Coaches and Disability Employment Advisers in Jobcentres and Access to Work grants, as well as joining up health and employment support around the individual through Employment Advisors in NHS Talking Therapies, Individual Placement and Support in Primary Care and WorkWell.

Additionally, the Youth Guarantee and Pathways to Work will guarantee specialist support for young people with long-term health conditions and disabled young people. We have announced an £820 million funding package for the Youth Guarantee to overhaul support and give a generation of young people a brighter future.

We set out our plan for the “Pathways to Work Guarantee” in our Pathways to Work Green Paper and we are building towards our guaranteed offer of personalised work, health and skills support for disabled people and those with health conditions on out of work benefits. The guarantee is backed by £1 billion a year of new, additional funding by the end of the decade. We anticipate the guarantee, once fully rolled out, will include: a support conversation to identify next steps, one-to-one caseworker support, periodic engagement, and an offer of specialist long-term work health and skills support.

In recognition of employers’ vital role in addressing health-related economic activity, we appointed Sir Charlie Mayfield to lead the independent Keep Britain Working Review. The Report was published on 5 November. In partnership with DBT and DHSC, we are immediately launching Vanguards to test new employer-led approaches to support individuals to stay in work and develop a Healthy Workplace Standard, putting Sir Charlie’s key recommendations into action from day one.  Additionally, the JWHD has developed a digital information service for employers, continues to oversee the Disability Confident Scheme, and continues to increase access to Occupational Health.

The NHS 10 Year Health Plan, published in July, stated our intention to break down barriers to opportunity by delivering the holistic support that people need to access and thrive in employment by ensuring a better health service for everyone, regardless of condition or service area. It outlines how the neighbourhood health service will join up support from across the work, health and skills systems to help address the multiple complex challenges that often stop people finding and staying in work.

Additionally, Alan Milburn will author an independent report to tackle the persistently high numbers of young people out of work, education and training. The report will examine why increasing numbers of young people are falling out of work or education before their careers have begun, with a particular focus on the impact of mental health conditions and disability. It will make recommendations for policy response to help young people with health conditions access work, training or education, ensuring they are supported to thrive and are not sidelined. It will complement the Timms Review by focusing specifically on the links between youth mental health, economic inactivity and the benefit system.

Question to the Department for Work and Pensions:

To ask His Majesty's Government what steps they are taking to improve labour market transitions for graduates and strengthen the capacity of the economy to absorb new labour market entrants.

Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)

Economic growth is the Government’s first mission: creating good jobs, raising living standards and improving public services. We are committed to ensuring that there is a vibrant and diverse labour market in the UK which offers good jobs for graduates and new labour market entrants. As part of our plan to Get Britain Working, we committed to reforming our public employment service through building a Jobs and Careers Service and as set out to the House of Commons on 8 December 2025, the Work and Pensions Secretary announced the expansion of our Youth Guarantee.

The Post-16 Education and Skills White Paper, published in October 2025, outlined our plan to deliver the skilled workforce our economy needs and provides graduate focused reforms that will ensure graduates have pathways into priority sectors with real labour market demand. The reforms include more flexible opportunities for graduates to retrain or upskill, more provision for blended learning and employer aligned courses and regionally expanded training aligned to priority sectors, delivered through Skills England and Strategic Authorities. Graduates in areas like digital, engineering, defence, and construction will benefit from more tailored pathways and employer partnerships.

Question to the Department for Work and Pensions:

To ask His Majesty's Government what plans they have, if any, to introduce additional pension protections to recognise periods of unpaid childcare, to mitigate the long-term pension disparities faced by women arising from maternity leave and reduced earnings.

Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)

The new State Pension, introduced in 2016, addresses historically poorer outcomes for women, low earners and self-employed people. This means, on average, women on the new State Pension are receiving almost £20 more per week than those on the pre-2016 system. That is around 98% of the amount received by men (the average for women under the pre-2016 system is 86%).

There are a wide range of National Insurance credits available to support a diverse range of people to build up entitlement to a State Pension, including credits linked to the provision of care for children (under 12).

Automatic Enrolment has succeeded in transforming workplace pension participation rates, in particular for women. We have seen participation rates amongst eligible women in the private sector now equal with those for men.

However, significant gaps remain, both in terms of pension participation and wealth. That is why we revived the Pension Commission, to consider what is required in the long term to deliver a pensions framework that is stronger, fairer and more sustainable. This will include exploring how to improve retirement outcomes, including for women, and those on the lowest incomes and at the greatest risk of poverty or under-saving.

Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the gendered impact of the changes to salary sacrifice pension arrangements announced in the Budget 2025, particularly in relation to women who experience career interruptions due to maternity leave or caring responsibilities.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

A Tax Information and Impact Note (TIIN) was published alongside the introduction of the Bill containing the changes to pensions salary sacrifice. The TIIN sets out the impact on employees and employers and is available here: https://www.gov.uk/government/publications/salary-sacrifice-reform-for-pension-contributions-effective-from-6-april-2029/salary-sacrifice-reform-for-pension-contributions

As set out in the TIIN, men are more likely to be using pensions salary sacrifice than women – 59% of pensions salary sacrifice users are men.

The cap protects 65% of women using salary sacrifice for their pensions contributions, compared to 50% of men.

Question to the HM Treasury:

To ask His Majesty's Government what analysis they have undertaken of the extent to which the £2,000 cap on national insurance-free salary sacrifice contributions will exacerbate the existing disparity in pension accrual experienced by mothers.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

A Tax Information and Impact Note (TIIN) was published alongside the introduction of the Bill containing the changes to pensions salary sacrifice. The TIIN sets out the impact on employees and employers and is available here: https://www.gov.uk/government/publications/salary-sacrifice-reform-for-pension-contributions-effective-from-6-april-2029/salary-sacrifice-reform-for-pension-contributions

As set out in the TIIN, men are more likely to be using pensions salary sacrifice than women – 59% of pensions salary sacrifice users are men.

The cap protects 65% of women using salary sacrifice for their pensions contributions, compared to 50% of men.

Question to the HM Treasury:

To ask His Majesty's Government what consideration they have given to the impact of salary sacrifice reform on the gender pension gap.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

A Tax Information and Impact Note (TIIN) was published alongside the introduction of the Bill containing the changes to pensions salary sacrifice. The TIIN sets out the impact on employees and employers and is available here: https://www.gov.uk/government/publications/salary-sacrifice-reform-for-pension-contributions-effective-from-6-april-2029/salary-sacrifice-reform-for-pension-contributions

As set out in the TIIN, men are more likely to be using pensions salary sacrifice than women – 59% of pensions salary sacrifice users are men.

The cap protects 65% of women using salary sacrifice for their pensions contributions, compared to 50% of men.