Carers: Financial Support

Baroness Wheatcroft Excerpts

Tuesday 16th May 2023 Lords Chamber

[Viscount Younger of Leckie (Con)]

The right reverend Prelate makes a very good point, and that is certainly an element of what we are doing and looking at. As I said, the main point is that we very much recognise the importance of carers and their work. Indeed, Carers Week runs from 5 to 11 June this year. On respite care, the right reverend Prelate makes an important point.

[Baroness Wheatcroft (CB)]

My Lords, there are many young carers between 16 and 25 in full-time education—around 375,000—but they seem to get a particularly raw deal, in that they are not eligible for any state financial support and have to look to charities. Will the Minister take a look at their predicament?

[Viscount Younger of Leckie (Con)]

I am very aware that some carers are extremely young, and I say again that I recognise the role of unpaid carers. The carer’s allowance is not intended to be a replacement for a wage or a payment for caring services, so we cannot compare it to the national minimum wage or the national living wage, for example. The noble Baroness raises another important point that we should continue to look at.

Unemployment: Over-50s

Baroness Wheatcroft Excerpts

Tuesday 9th March 2021 Lords Chamber

[Baroness Stedman-Scott (Con)]

Kickstart for older workers: message received and understood. The UK Government are investing £2.5 billion in the national skills fund to aid the lifetime guarantee, we have a free online skills toolkit and the Chancellor’s announcement in July of his Plan for Jobs included an extra £17 million to support 32,000 more vocational training places.

[Baroness Wheatcroft (CB) [V]]

My Lords, a snapshot by the Institute for Fiscal Studies last year showed that one in four people on furlough were over 50. My concern is that many of those people will not go back into employment again—as we have heard, over-50s are harder to employ. Could we not profitably use the time when people are on furlough to retrain them for the jobs that will be available when we come out of the pandemic properly?

[Baroness Stedman-Scott (Con)]

I am pleased to be able to confirm to the House that, where an employee is on furlough, they can take part in training, volunteer for another employer or organisation or work for another employer if contractually allowed.

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

Baroness Wheatcroft Excerpts

Thursday 25th February 2021 Lords Chamber

[Baroness Wheatcroft (CB) [V]]

My Lords, as others have, I thank the Minister for introducing this SI in her characteristically clear, straightforward way. I declare my interest as set out in the register as the director of a financial services business.

We have to be grateful that auto-enrolment was introduced in 2012, that the scheme has prospered and that during this difficult period of Covid the Government have continued to support it. Getting people to save for their retirement is an imperative, and the sad thing is that so many will find themselves reaching retirement with only the tiniest of pension pots. Given the level at which auto-enrolment starts, it would be wrong to encourage people to believe that a happy retirement necessarily awaits.

It is absolutely the right thing to have kept the threshold where it is because something that has become apparent in the time of Covid is just how little of a cushion many people have, and therefore bringing the threshold down or altering it at all would have brought people closer to destitution. A report from the Joseph Rowntree Foundation at the end of last year found that, appallingly, the number of people in destitution during the previous year had risen by one-third. This meant that 2.4 million people, as the foundation says, were living in a position where they were unable to afford to meet their needs or those of their children. That is an appalling state for a country that is supposed to be a civilised leader in the western world.

People who were still in work found themselves having to go to food banks on an ever-increasing scale so it is crazy for us to believe that they could be saving for a pension. The problem is that so many people in our country work but do so on a very, very low wage. The problem is not with auto-enrolment—the scheme is good—but with the amount of money that people have to save.

Does the Minister have plans to do anything about the unfairness that is part of our capitalist system? I do not want to turn the capitalist system upside-down—far from it—but, as we come out of Covid, the fairness agenda will have to be addressed in a way that I do not see being done currently. I would be interested to hear the Minister’s views on that. I know she has a deep social conscience that will make her uncomfortable with the discrepancy in many businesses between those at the top and those at the bottom.

Setting the minimum wage where it is now means that many people who take dividends out of businesses are finding those dividends financed, in effect, by the taxpayer in the form of tax credits to those at the bottom of the company who simply cannot afford to live on what they are being paid. The working poor are a major problem in this country, and that problem will of course be exacerbated when they retire and have only their state pension to live on.

At the other end of the scale, I endorse what the noble Lord, Lord Bourne, said when he asked the Government what they were doing to make more people aware of the importance of saving for their retirement. Although of course I have every sympathy for those who are not in a position to save for their retirement, I also believe that those who can save should, and that they should save not only on their behalf but on behalf of their children. Can the Minister tell me in particular what steps the Government are taking to promote the junior SIPP scheme—the junior pension—to which people could contribute small amounts from the birth date of their children and which would multiply over time to provide a decent pension?

Covid-19: Youth Unemployment

Baroness Wheatcroft Excerpts

Tuesday 2nd February 2021 Lords Chamber

[Baroness Stedman-Scott (Con)]

The noble Lord is right to point out the level of unemployment among young people and graduates; I take no argument with that. But he asks when the Government will recognise this: we are working flat out to ensure that young people get the help they need to get a meaningful job and the skills they need to compete effectively in the job market. I can assure the noble Lord and the whole House that we are working at pace to achieve this.

[Baroness Wheatcroft (CB) [V]]

My Lords, one thing that has become apparent during Covid is that initiatives work best when they are local rather than national. Needs for skills and therefore for training are also often local rather national. For instance, the noble Baroness, Lady Janke, referred to the creative industries. In this country film production is thriving in Yorkshire, while Leamington Spa is the capital of video games. So can the Minister reassure me that local authorities will have much more say in what training schemes are made available and how they will be funded locally?

[Baroness Stedman-Scott (Con)]

My noble friend raises a number of relevant points. As I have said, we are working with local authorities and businesses. There is absolute mileage in all my noble friend says about things being done locally, because people know one another best in their local community. My strapline for all that we are doing is “To be known nationally but felt locally”.

Pension Protection Fund (Moratorium and Arrangements and Reconstructions for Companies in Financial Difficulty) (Amendment and Revocation) Regulations 2020

Baroness Wheatcroft Excerpts

Wednesday 21st October 2020 Lords Chamber

[Baroness Wheatcroft (Non-Afl) [V]]

My Lords, I welcome the regulations and thank the noble Baroness for introducing them. It is right that they are now extended to cover co-operatives, friendly societies and other community purpose efforts. There will be many more occasions on which we need these regulations. I share the concerns of the noble Lord, Lord Loomba, that the PPF, which is doing a brilliant job so far, will come under increasing strain. As others have said, I would appreciate a reassurance that the PPF has not only the funds but the staffing to cope with the increased demands that are bound to be made on it as more and more companies, community organisations and co-operatives are hit by the difficulties and effects caused by Covid.

More broadly, when companies and organisations start to negotiate a moratorium and then a restructuring, there is always a need for trade-offs, as the noble Baroness, Lady Drake, suggested. My concern is that the trustees in many of those organisations are not sufficiently of a calibre to properly negotiate holding the line against owners and directors of businesses, who tend to drive for a solution that will benefit them and not the pension fund. I should therefore be grateful if the Minister reassured me on what we were doing to enhance the calibre of such trustees. Their responsibilities are great but their training is not.

Pension Protection Fund (Moratorium and Arrangements and Reconstructions for Companies in Financial Difficulty) Regulations 2020

Baroness Wheatcroft Excerpts

Monday 14th September 2020 Grand Committee

[Baroness Wheatcroft (Non-Afl) [V]]

My Lords, I thank the Minister for the way in which she introduced the regulations and for the time she made available to talk to those of us who were interested. She is always keen to be helpful and it is much appreciated.

Obviously, these regulations are needed, and as quickly as possible, but there are issues. I associate myself with the questions raised, particularly by the noble Baronesses, Lady Drake and Lady Altmann. All were interesting questions that deserve answer. I will then specifically query the possibility of companies going through a moratorium and restructuring being obliged to continue paying into deficit reduction funds. My understanding is that, during a moratorium or reconstruction, the obligation to pay staff remains and therefore the obligation to continue paying their pension contributions remains. However, there seems to be a question mark over payments into deficit reduction. I would be grateful if the Minister could give some clarity on that.

Secondly, can the Minister give clarity on the issue that was certainly highlighted during the Bernard Matthews fiasco a couple of years ago? During the course of a reconstruction, what must be termed quite risky—and extremely expensive—lending was taken on to preserve the company, and the result was certainly to disadvantage the pension fund. Will that still be possible under these regulations? In addition, when a company is going through a reconstruction, what is the significance of a floating charge to the pension fund? Does that floating charge continue to take priority?

More generally, since we are heading into a period where corporate collapses could, sadly, happen at far greater a rate than that to which we are used, as other noble Lords have pointed out, does the PPF have the manpower to monitor the situations in so many companies and to keep on top of the situation?

My final question is an overarching one about the ability and the independence of trustees. Much of the thinking behind these regulations seems to imply that, faced with choosing between the longest period of saving the company and looking after the interests of pensioners, the trustees, despite having a duty to pensioners, may well move towards safeguarding, as far as possible, the future of the company and its investors. That seems to highlight a potential failing in the system which has long been a matter of interest.

Pension Schemes Bill [HL]

Baroness Wheatcroft Excerpts

2nd reading (Hansard): House of Lords
Tuesday 1st November 2016 Lords Chamber

[Baroness Wheatcroft (Con)]

My Lords, I welcome the Bill and declare my interest as the director of a savings business. Pensions are the main savings for millions of people in this country, but the savings level is still woefully low. People are looking towards a retirement that will leave them impoverished, and many are unaware of just what lies ahead. A private pension pot would need to contain around £181,000 now to provide an income of £10,000 in retirement for someone who is currently 30. That is beyond the dreams of most people. However, this is why auto-enrolment is so positive.

Young people need to save and they need to start saving as early as possible, but pensions are not often high on their list of priorities, so auto-enrolment is a real force for good. However, if those schemes in auto-enrolment should hit problems—just as when any pension fund hits disaster—it will destroy confidence in the entire industry. Therefore, I welcome the Bill as a necessary step to safeguard the master trust. I also share with others the concern that we have reached this stage without putting in place some of the protections that are now included in this very worthwhile Bill.

There is much still to be discussed, however. It is obviously right to have various hurdles that master trusts must now jump to get through the authorisation process. I share the interest of the noble Lord, Lord Stoneham, in what will constitute a fit and proper person to be a trustee of one of these organisations. Is it to be left to the Pensions Regulator to determine case by case or will guidelines be laid down, covering, for instance, experience and track record? Being a trustee of a pension fund or a master trust is a hugely responsible job, and we need to be sure that people are not just stereotypical but fit and proper for the task that they will be taking on.

There are other things that the regulator could—and, I believe, should—take account of. It is all very well that one of the authorisation criteria is that the master trust should be financially viable but the idea of having a minimum capital requirement seems perfectly sensible. My noble friends Lord Naseby and Lady Altmann both referred to that. As I said, it seems very sensible and could easily be done.

Many believe that the Pensions Regulator is already overemployed and understaffed. If it is to cope with the raft of new work coming its way, it is imperative that it has the people to do that job, and I hope we can ensure that that is the case. I also hope that the regulator will be able to push some of these master trusts towards consolidation, because it is important that the people who put their savings into master trust schemes have access to the widest possible range of investments. Only by coming together in consolidated organisations will the trusts be able to take advantage of the big infrastructure opportunities. For many years now we have talked about pension funds investing in infrastructure but it has not happened. However, I believe we are on the cusp of a real change, where pension funds will put their money into housing schemes and other infrastructure projects—schemes the country needs now more than ever—and investors will benefit from the sensible, long-term match between liabilities and income, which infrastructure can develop. However, a small master trust will be unable to access those sorts of opportunities.

I warm to the calls that we have heard from some lobbyists and other quarters for master trusts to have obligations that go beyond the five stipulated criteria. I think they should have to make much more information available to those who invest in a pension scheme. It is imperative that we get a newly invigorated investment climate in this country. Traditional institutional investors have, on the whole, shown themselves to be pitifully uninterested in where their money goes and in the long term. If pension fund investors were told more about the investment policies of the fund that they were putting their money into—about the stocks and the other investments that the fund was investing in—I think we could encourage a much more positive attitude towards long-term investment, which we undoubtedly need in this country.

At the very least, I should like to see annual meetings at which those pension fund investors can, if they wish, feel involved. The noble Lord, Lord Stoneham, talked about new technology and how digital can enable everybody, wherever they live, to take part in webinars and attend annual meetings, even if they are there only virtually and not in person. I would like to see master trusts obliged to open up their proceedings in that way. Transparency is the watchword for us all now, and the more transparent they can become, the better.

I welcome the cap on exit charges. Clearly, people have been grateful for the pension freedoms they have been given and they have been relatively sensible in how they have used them. We have not seen pension raiders driving around in Lamborghinis, as we were told would happen. People are taking out the money to do sensible things—often to pay down a mortgage—and we should make sure that the charges for doing so are kept to a reasonable level.

However, there are a couple of other things to which the Minister referred but which are not in the Bill and which I would like to see. One is the central advice system. Another bout of consultation is all very well but people need advice on pensions and savings—they are not clear where to go for it—and we should make that single source of advice available as quickly as possible.

I would also hope that a Bill called the Pension Schemes Bill could move a little further into defined benefit schemes. I know the Minister told us that the Government were looking further and that more would be forthcoming, but given what has happened in defined benefit schemes recently, would it not be possible to look at the role of the pension fund trustee, not just in master trusts but in defined benefit schemes? They got more power in 2013 to ask for information in the case of takeovers, but could we not impose on pension fund trustees whose underlying business is subject to a takeover an obligation to get independent legal and financial advice before agreeing to let that deal go through?

State Pension

Baroness Wheatcroft Excerpts

Thursday 28th April 2016 Lords Chamber

Asked by

[Baroness Wheatcroft]

To ask Her Majesty’s Government how many people they expect to benefit from the new state pension, and what will be the average increase per person.

[The Minister of State, Department for Work and Pensions (Baroness Altmann) (Con)]

My Lords, by 2030 the new state pension will result in higher state pension payments for 6 million future pensioners, who will receive on average £10 a week more state pension, with 3 million women receiving on average £11 a week more and 3 million men receiving £9 a week more.

[Baroness Wheatcroft (Con)]

I thank my noble friend the Minister for those encouraging numbers. The old system was complicated and confusing, and many people were left uncertain of what their income would be in retirement. Does my noble friend think that the new system, which is not just higher but clearer, might encourage more people to save for their retirement?

[Baroness Altmann]

My noble friend is absolutely right. The aim of the new state pension is that people will have a much clearer idea of how much they can get from the state pension without extensive means testing so that it is clear and safe for them to save as they can on top of it.

Benefit Cap

Baroness Wheatcroft Excerpts

Wednesday 2nd July 2014 Lords Chamber

[Lord Freud]

Well, my Lords, my job at the Dispatch Box is to answer questions from all Peers. I hope that I have established a track record in answering questions with as much properly sourced information as I possibly can.

[Baroness Wheatcroft (Con)]

Very often, those who are out of work are suffering from other problems as well, often drink or drug addiction or a very poor education. Can the Minister say what is being done to help with those issues?

[Lord Freud]

One of the things that we are doing is reforming the whole of the welfare system in order to find out the barriers to going to work that people have and helping to address them. In the particular case of the introduction of the benefit cap, we had an enormous initiative to work with those individuals through Jobcentre Plus. We wrote to them, talked to them and provided intensive employment support. We worked with local authorities to help them with budgeting, housing and childcare. In this particular case we worked hard, and that seems to be an effective set of interventions.

Youth Unemployment

Baroness Wheatcroft Excerpts

Monday 7th April 2014 Lords Chamber

[Lord Freud]

There is a great deal of confusion about long-term youth unemployment. The actual figures, rather than the fantasy figures made up on the opposite Benches, show that before the coalition came to power long-term youth unemployment had doubled. Since then, that increase has slowed and the figure has now started to fall—it was down 38,000 this quarter and 59,000 this past year—and the long-term count has fallen for the 12th consecutive month. Those are the unemployment figures. One of the sources of the confusion is the JSA claimant count for long-term youth unemployment. The reason for that confusion is that the previous Government hid long-term unemployment by introducing training allowances, which took people off. So those figures are distorted. The right figures, which show the underlying position, are the ILO unemployment figures which I have just given.

[Baroness Wheatcroft (Con)]

My Lords, I recently visited the Hammersmith Jobcentre Plus. I recommend it to all noble Lords, and not only if they are looking for jobs. It was a delight to see that under one roof one could get help with housing, drug and education problems as well as with jobs—and, of course, the first three are important in finding jobs. Does the Minister agree that this holistic approach is paying dividends?