Pensions Bill

Lord Stoneham of Droxford Excerpts

Monday 13th January 2014 Grand Committee

[Lord Stoneham of Droxford (LD)]

I was not going to intervene, but there is not as much difference between the two sides of the Committee on this, as earlier contributions seemed to suggest. I certainly thought that the remarks of the noble Baroness, Lady Drake, were right down the line and I was sympathetic to them. Nobody is suggesting that the Labour Government were wrong to start the debate on early retirement. Everybody knows that life expectancy is improving and there are great complexities with inequalities. I would question whether the inequalities have necessarily got worse. I will come to that in a moment, but there is also the issue of overriding affordability.

One of the problems of extended life expectancy is that it almost certainly results in higher social care costs—and, as we know, higher pension costs. We all want to see better pensions, and you cannot often have both a lower retirement age and better pensions. It has to be recognised that you have to get a balance. We have all seen the extra costs that this Government have put into pensions through the triple lock. We want to see that continue into the next Government as well, but that will add to the overriding costs.

I question the inequality issue. As someone who worked in the mining industry when there were 250,000 people working in it, having seen the consequences of early retirement on a lot of those communities and the effect that it is already having on inequalities and lifetime expectancy, I would expect to see some improvement, as we have moved away from older, heavy industries. Another argument was about boring jobs—and boring jobs in the health service. The boring jobs of my generation were in the car assembly industry. With improved technology, anybody organising cleaning jobs should certainly know that that is one of the most important jobs in the health service. It should be respected and there should be pride in it, and there are ways and means of managing that.

That takes me to my further point. You have to have a uniform state pension age and it has to be an average. There will be difficulties with certain occupations, but those have to be respected. We already have some occupational pension schemes that have a lower retirement age because of the consequences of people working in those sectors.

My final point is on the categories that we are using here and the factors that will be included in any review. Those will change over the next 20 years. You could put in the proportion of people smoking or having bad diets as factors that should be looked at specifically. In fact, there is a whole variety of factors and I do not think that the Government are saying in the Bill that there will not be a variety of factors considered in these reviews. We all have an interest in reducing the health inequalities that arise in terms of life expectancy. Under the Government’s proposals, these factors will be taken into account, but we are giving people a recognition that this will be done formally, as part of a set procedure, whenever this is looked at every six or seven years. This will give some certainty as we go forward. I doubt whether the differences between us are really very big.