State Pension Reform

Andy Sawford Excerpts

Monday 14th January 2013 Commons Chamber

[Steve Webb]

I am grateful. Carers receive the carer’s allowance, and there are other sorts of carer’s credits. Carers will thus end up with credits for the full £144—or whatever the final rate ends up being—so this has the potential to be a significant benefit to them. The hon. Lady is absolutely right that it is all very well for us to talk about simplicity, but people need to experience simplicity. That is why the White Paper provides an example of a pension statement. It is a single piece of paper saying, “You have built this amount up; if you do this many more years, you will get the full pension.” Everybody will know the rate: it will be a standard figure, and much harder for future Governments to tinker with.

[Andy Sawford (Corby) (Lab/Co-op)]

I have been contacted by my constituent, Mrs Slater. She is a widow, aged 59. She tells me she was informed on her husband’s death that she would benefit from his working life and national insurance contributions. She is now concerned that a flat rate will mean that his hard work will no longer be counted when she retires. Will Mrs Slater will be better off or worse off under these proposals?

[Steve Webb]

I am grateful to the hon. Gentleman, because I understand the concern that any change creates for people. In 2017, I assure him, we will work out people’s pension rights under our new system— 35 years for the full £144, with deductions knocked off for past periods of contracting out—and if that figure amounts to less than the rights someone has already built up, they will start from the higher one. We will honour the past. People will not build up new rights under those sorts of arrangements, but those they already have will be honoured.