Pensions Uprating (UK Pensioners Living Overseas)

Angela Rayner Excerpts

Wednesday 11th May 2016 Commons Chamber

[Angela Rayner (Ashton-under-Lyne) (Lab)]

I congratulate the hon. Members for Ross, Skye and Lochaber (Ian Blackford) and for Motherwell and Wishaw (Marion Fellows), and my hon. Friend the Member for Vauxhall (Kate Hoey) on securing the debate. I thank all hon. Members taking part in it. They have already made some significant contributions.

My party leader has spoken eloquently on this issue in the past, having previously served on the all-party group. Frozen pensions seem even more of a problem today in the context of the rich and wealthy hiding their money in overseas tax havens. Many of my constituents have grandparents and parents who answered our Governments’ calls after the war to come to rebuild our country. Many of those pensioners have been long-standing public servants and have even fought for our country. They have paid national insurance for many, if not all, of their working lives and played by the rules.

Since 1981, however, it has been the position that where a person is not “ordinarily resident” in the UK there is no entitlement to an annual increase in retirement pension. The Government recently reaffirmed this in the debate on 26 January where the Minister stated:

“As hon. Members will be aware, the state pension is payable worldwide, but upratings for people who are not ordinarily resident in Great Britain are generally restricted to people living in the European economic area, Switzerland, Gibraltar or countries with which there is a reciprocal agreement that provides for uprating.”—[Official Report, Second Delegated Legislation Committee, 26 January 2016; c. 4.]

Cost has been cited as a determining factor in continuing to freeze pensions, and the House of Commons Library puts that in the region of £500 million a year. However, the proposal of partial uprating has an estimated up-front cost of just £37 million—small in Government spending terms—and this option offers an affordable and expeditious policy alternative. I and my party are keen to review the research by the International Consortium of British Pensioners and the National Pensioners Convention that suggests a partial way forward that is cost neutral to the Exchequer. We want to be bold in our response, and also credible. Indeed, I am aware that the right hon. Member for West Dorset (Mr Letwin) has made a commitment to look into this proposal on behalf of the Government.

As somebody relatively new to this brief, I believe it is worth taking a fresh look at the current arrangements, as the logic is just not there. Arrangements have been made with some countries and not others. While one British pensioner in the USA gets an uprated pension, a pensioner in neighbouring Canada has theirs frozen. The Government should review the impact of this policy. Labour is calling for a full equalities and impact assessment of the freeze in overseas state pensions, as well as a country-by-country analysis of the number of people affected. I recently met the ICBP and the NPC, and we discussed the impact of the freeze in overseas state pensions. Many Members have spoken passionately about the individual impacts, such as in the case of Rita Young being kept away from her family, mentioned by the hon. Member for Ross, Skye and Lochaber.

The Government have told us half the story, but Ministers must be forthcoming about the impact of this policy. For example, the vast majority of those affected live in Canada or Australia, two countries where the pensions system is means-tested. The previous Pensions Minister said that, as a result, uprating the pensions of British citizens living in those countries would, in effect, mean a transfer to the Canadian and Australian exchequers, and the pensioners themselves would not necessarily be any better off. I would welcome further details from the Government about the number of British pensioners living in countries where the pensions system are not means-tested. I would be grateful if the Minister could give the House that information today or write to me. How many British pensioners live in countries where the pensions system is not means-tested, and by how much are they losing out? Echoing the request made earlier, have the countries in which they live approached the UK Government for a reciprocal agreement similar to that which we have with the United States, and if so, on what grounds were those agreements refused? Overall, will the Minister give us an estimate of the cost to the Exchequer of uprating for British pensioners living in countries where the pensions system is not means-tested?

I am keen to listen, learn and work with stakeholders such as the all-party parliamentary group to find a solution that is credible, affordable and fair. Members across the House will, like me, have received emails and correspondence from many overseas pensioners who will be watching this debate. I hope they take from it the message that Members from across this House value the contribution that they have made to our great country and will continue to work across parties to seek a fair way forward.

Draft Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2016

Angela Rayner Excerpts

Wednesday 16th March 2016 General Committees

[Angela Rayner (Ashton-under-Lyne) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Percy, and to face the Minister again. The name of the order just rolls off the tongue, doesn’t it?

The order reflects the view shared by the Government and the Opposition that the overriding purpose of auto-enrolment should be to ensure that people have sufficient retirement income savings. I do not intend to divide the Committee, but I will make some short but very important points and pose some questions that I hope the Minister will answer today.

Different groups, such as women, ethnic minorities and disabled people, experience differences in pension savings. In the debates on the orders in years when the earnings trigger was increased, concerns were expressed about the number of low-paid workers—disproportionately women—who were, in effect, excluded from the scope of auto-enrolment as a result. Having a relatively low income in retirement can be the result of lifelong disadvantage. When such disadvantage extends beyond a person’s working life, it can indicate particular vulnerabilities and the need for support and social policy intervention.

Automatic enrolment, which is intended to increase participation among those who are most likely to be under-pensioned and particularly the low-paid, should go some way towards increasing the level of private pension saving among those in under-pensioned groups. However, the way in which the auto-enrolment eligibility criteria are structured means that employed people from under-pensioned groups are less likely to be eligible for it. It would therefore be helpful to know from the Minister what his Department is doing to promote the voluntary opt-in arrangements for those who do not meet the minimum auto-enrolment thresholds, but who could benefit from saving, such as the self-employed or people with multiple lower-paid jobs.

According to the Pensions Policy Institute, removing the automatic enrolment qualifying earnings band entirely would have a greater positive impact on retirement income than increasing the minimum contribution level to 10% of qualifying earnings. What is the Minister’s view of that proposal?

It is important not only to ensure that people put something into their pots, but that they understand the choices they have to make. Those who are eligible for tax relief should not be made to search for the qualifying criteria; those should be clear to them before they are enrolled. That applies particularly to those on low incomes. It is not enough just to expect the 180,000 workers earning between £10,000 and £11,000 a year, and the small and micro employers that the Minister mentioned, to search the internet to check whether they have auto-enrolled into a workplace pension that uses a net pay tax relief arrangement. Such workers will not benefit from tax relief on their contributions. What will the Government do to inform those employers and workers to ensure that they get the best deal and the most value from their investments?

As we have a long day ahead of us, I shall make one final, overarching point. In many Committees like this, I have raised the issue of protection for savers. That has to be a crucial part of the auto-enrolment process. I remain concerned at the lack of action by the Government regarding protection for savers, particularly in relation to the master trusts that many small and micro employers choose as a vehicle for auto-enrolment.

As I noted last week, we have heard three different positions from three different Ministers. The Economic Secretary to the Treasury told us during a recent Public Bill Committee that legislation was imminent. The Minister for Pensions then told the Select Committee on Work and Pensions last week that legislation was urgently needed, but that she could not get parliamentary time from the Government. Finally, the Under-Secretary before us said at our last exchange in a Delegated Legislation Committee that the Government were still working out whether they should do anything and, if so, what. Frankly, neither the disagreements nor the dithering will inspire much confidence among the ordinary savers whose retirement security is potentially in danger, so will the Minister finally give us a definitive answer on the Government’s plans today?

Draft Occupational Pension Schemes (Scheme Administration) (Amendment) Regulations 2016

Angela Rayner Excerpts

Thursday 3rd March 2016 General Committees

[Angela Rayner (Ashton-under-Lyne) (Lab)]

It is a pleasure to face the Minister again under your chairmanship, Mr Bone. It is rather unfortunate that, as I think one of the Guardian columnists has said, as soon as people see “pensions” in the title of anything in the media today, they glaze over. However, I hope that the Minister will not glaze over during my contribution today, because although the Opposition will not oppose these measures, we want to touch on several important concerns that are related to these regulations.

To put the measure into context, employers have a choice about the kind of pension they make available for their employees, with some choosing to use schemes based on a trust with trustees. Others choose schemes provided by insurance companies, which result in contracts between the providers and the employees. Such schemes include personal pension schemes and stakeholder pension schemes, which employers use for auto-enrolment or otherwise make available to their employees. There is no board of trustees and no fiduciary duty to the scheme member.

The market for multi-employer schemes, known as master trusts, is relatively new and has undergone rapid expansion in the last couple of years. The major players have been open for business only since 2011 and barriers to entry have historically been low. While no official list of providers exists, Professional Pensions sought to compile a definitive list in August 2015 and identified 57, but there could be as many as 70 or even 80 master trust providers in the UK. Employers have to try to distinguish between many offerings of varying quality, and there are concerns across the sector about regulation and governance.

In its evidence to the Select Committee on Work and Pensions’ current enquiry on auto-enrolment, the Association of British Insurers made the point that trust-based schemes, including master trusts, are not

“subject to the same stringent regulatory standards as contract-based schemes, which are regulated by the FCA.”

Instead, master trusts are supervised from a distance by the Pensions Regulator, which does not have the power to check how the pensions are sold or to shut down companies that fall short of basic standards. The Pensions Regulator highlighted the issue to the Work and Pensions Committee:

“94% of employers who chose a trust-based scheme opted for a master trust. Due to their scale, commercial purpose and design for use by multiple employers, master trusts represent different risks to members and consumer protection when compared to other occupational schemes. Unlike pension providers regulated by the FCA, the master trusts themselves are not authorised prior to market entry and the regulatory framework is not designed for similar levels of ongoing supervision. As a way of mitigating this risk, we introduced the master trust assurance (MTA) in May 2014, developed in partnership with the Institute of Chartered Accountants in England and Wales (ICAEW). However, it is a voluntary arrangement”.

Only five master trusts are part of the master trust assurance framework, meaning that they are independently audited.

Andrew Warwick-Thompson, executive director for regulatory policy at the Pensions Regulator, warned that some of the other schemes were too small and had no safeguards protecting their members. Alarmingly, he added:

“There is a risk of these schemes falling over; there is a risk that members might lose their money.”

He went on to warn that the lack of requirements for qualifications or assets meant that some master trusts

“may not be run by competent people”.

The so-called fit and proper person test appears to be even less stringent than that applied by the Football League. HMRC’s guidance suggests that it will automatically assume that anyone who applies is fit and proper. Perhaps the Minister will tell us whether the Government have any plans to change HMRC’s practice or guidance in that regard. Even when directors are qualified, providers do not always make it clear where the savings are invested and who owns the schemes.

The BBC programme, “The World Tonight”, also discovered that at least one master trust seemed to be providing misleading information online. The website, myworkplacepension.com, claims to have £50 million of pensions under management managed by the City firm, Old Mutual. When the BBC scrutinised the whereabouts of that money, myworkplacepension.com admitted it had no such assets. Subsequently, Old Mutual denied handling the company’s account and asked for its name to be removed from its publicity.

According to Companies House records, My WorkPlace Pension Ltd is 50% owned by Gavin McCloskey, who, with an associate, Anthony Okeke, was previously a director of a firm that sold sports fashion clothing. Incredibly, its trading name was Wide-Boys R Us.

[Simon Kirby (Brighton, Kemptown) (Con)]

Yeah! [Laughter.]

[Angela Rayner]

We may laugh, but it will hardly be amusing to someone who finds their employer has invested their pension with a dubious scheme and without safeguards. Alarmingly, the programme also cited one industry expert who suggested that only around 10 existing master trust schemes could be considered completely safe and reliable. There is a view, therefore, that strengthening the requirements to enter the market, such as with authorisation or licensing, should filter out the least desirable operators. We would like to know more about the regulatory framework within which the Minister envisages today’s regulations will sit.

This issue was raised by my hon. Friend the Member for Wolverhampton South West (Rob Marris), who, as shadow Financial Secretary to the Treasury, represented the Opposition during the Committee stage of the Bank of England and Financial Services Bill. The Economic Secretary to the Treasury responded that the Government would bring forward regulations as soon as practically possible. Can the Minister tell us today what discussions the Department for Work and Pensions has had with the Treasury about that legislation and give us an update? Perhaps he will tell us how such legislation relates to the comments of his colleague, the Minister of State for Pensions, in the press on 1 March. She complained that the Government would not give the Department parliamentary time for pensions legislation specifically in relation to master trusts. She said:

“We need legislation and have been bidding for a bill, a pensions bill but it has been refused. It was refused at the end of last year and it has still not happened…I am hoping we will get one because we can’t do anything properly without it.”

We seem to be in the extraordinary position of the Minister for Pensions admitting that she cannot do anything properly on this issue because she cannot get parliamentary time from her own Government, whose legislative agenda is hardly full. However, this seems to be flatly contradicted by the remarks of the Economic Secretary, so is the Treasury more up to date on pensions policy than the Minister for Pensions, or is that just where the power lies in this Government? Perhaps none of them knows what is going on.

If the Minister knows anything about his own Department’s legislative agenda, perhaps he would clarify whether we can expect a Bill and, if so, when. There are a number of questions about the regulatory framework on which it would also be helpful to hear his views.

[Chris Philp (Croydon South) (Con)]

With great respect to the hon. Lady, whose comments are interesting, we seem to have strayed a long way from the regulations before us. Does she plan to get back to the matter at hand in the near future?

--- Later in debate ---

[The Chair]

Order. If the hon. Lady had been out of order, I would have said so. I do not need any help from the hon. Gentleman, thank you.

[Angela Rayner]

I thank the hon. Gentleman for his comments. This is not just interesting; it is alarming for people with pension provision, who want to know that things are being done to ensure that their pensions are protected, so I will carry on.

It may be that some of these issues I am raising could be addressed in the legislation, but I hope the Minister can enlighten us. To start with an obvious point, master trusts are exactly that: trusts. A trustee board sounds friendlier than a governance committee, but there are no requirements for at least one third of the trustee board to be member nominated. Some voices in the sector are calling for a level as high as 50%. Will the Minister give us his view on that?

Master trusts are cheap to join. Currently, large master trusts are subsidising the installation costs from reserves, which gives them a competitive edge in the market. However, like credit cards, master trusts are for life, not just for their initial rates. Does the Minister believe there is any cause for concern there?

The regulations that apply to retail funds do not apply to master trusts, nor does the Financial Conduct Authority have jurisdiction over them. Given the Government’s pension freedoms agenda and the arrival of 1.3 million small and micro-employers, the traditional boundaries between institutional and retail are blurring. That brings us back to the question of who the appropriate regulator is. Are the Government considering giving the FCA regulatory powers or changing the powers of the Pensions Regulator, as the Minister with responsibility for pensions reform seemed to suggest in the media earlier this week?

Unlike insurance arrangements, master trusts are not subject to solvency II and do not even have to undergo the capital adequacy test needed to run an advisory firm. In theory, that makes them nimble and cheap to run, but in practice it means they have little margin for error. If the controls in the master trust assurance framework are not adopted, can the Minister assure us they are as safe as contract-based arrangements? If not, what steps will he take to protect members from failure?

Members of master trusts are not protected by the Financial Services Compensation Scheme or the Pension Protection Fund. Have the Government given any thought to changing that or providing another failure regime? As I said earlier, the Minister with responsibility for pensions reform suggested in the press this week that a compulsory insurance scheme is her preferred solution and that she wants to introduce one in a pensions Bill. Can the Minister confirm whether that was a statement of Government policy?

Similarly, master trusts are not subject to permitted links regulations, which restrict where insurers may invest. That gives master trusts more flexibility, but could make them an ideal vehicle for pension scams. What assurances can the Minister give us that the Government are dealing with that risk?

It has been suggested that employers could use master trusts to de-risk unwanted liabilities from defined contribution schemes. They are taken to be a safe haven for employers but, contrary to what employers may suppose, they cannot just offload their company’s pensioners into somebody else’s master trust and wash their hands of the liability. They remain a participating employer of the master trust for as long as their former members are in it. Is the Minister confident that this issue is being addressed? Master trusts may be being used for auto-enrolment, to de-risk existing schemes, or even as a template for collective DC, but they are not a universal solution and should surely be subject to the same scrutiny as other structures.

As a result of master trusts’ unusual structure, certain practical challenges have emerged with no easy solutions. Given the scale of the operations and the sheer number of employers and members involved, is it not uncommon for contributions to be paid late or in error, or not paid at all? However, the obligation to report late contributions is the same, as are the trustees’ legal obligations to chase up late payments. Is the Minister confident that those obligations are being fulfilled?

Some master trusts have no mechanism to bulk transfer-out members once they are in if the scheme does not perform as expected. Does that issue need regulatory action? The default fund for an employer may not be chosen by trustees who are familiar with their membership. Indeed, how can it be possible for a default fund to be appropriate for more than 1 million members from diverse industries, of different ages and with different earning capacities? In short, can one size fit all? I would welcome the Minister’s observations and any answers to how that fundamental question can be addressed.

Rapid growth in the last four years has been fuelled by a steadily increasing market of employers who need providers. That will likely dry up in 2018, once auto-enrolment has been rolled out fully. After that, only acquisition will fuel growth, and we can expect consolidation, which makes the question about size all the more important, while also raising concern at the other end of the market about any weaker performers who may be too small for safety while not presenting an appealing target for acquisition. In the battle for market space, both the contract providers and the master trusts are in danger of cutting corners and taking risks that will compromise scheme members.

Given that DC scheme members should be the beneficial owners of their assets, the Government have left too many pension futures in doubt without a clear plan to deal with the issues. On top of that, we are in a situation in which no scheme member can know the true costs. How much someone pays to invest has a huge impact on the net returns they receive when they retire. Indeed, some analyses suggest that, after costs, only a small minority of managers actually deliver any value at all, and just 25 out of more than 200 fund houses have signed up to a statement of principles, introduced by the Investment Association, that included a commitment to put the interests of clients ahead of their own.

The Government, the IA and the FCA have been talking about transparency for some time, but when can we expect action? What steps are the Government taking to protect the security and fiduciary interests of scheme members in both master trusts and contract-based schemes? Does the Minister agree that DC schemes should have boards of trustees in which scheme member representatives should be in the majority and that they should be chosen by the scheme members themselves? That would be one way to give scheme members assurances that their money and their assets were being looked after in their interests. That is vital to the people who are listening to this.

In contract-based DC schemes, there are no requirements for trustees to act in the fiduciary interests of members, and in his recent written answers the Minister fell short of pledging any action to rectify this. Given the history of financial services scandals, is that not one way in which we could prevent the abuse of scheme members’ money? The Government have also failed to legislate for cost transparency for pension scheme members. In DC schemes, all costs are borne by the individual member. Will the Minister encourage the Investment Association to provide the data sets needed for transparency and say where he stands on new legislation?

Finally, as a former Unison shop steward in local government, I note that the Minister’s colleagues in the Department for Communities and Local Government have moved to require scale and cost transparency in the local government pension scheme, so will the Department for Work and Pensions act to provide the same protection for other savers? The measure before us today is technical, and we do not intend to oppose it, but the wider context of these regulations is of far greater concern. I hope the Minister can address those concerns for us all now.

--- Later in debate ---

[Mr Vara]

My right hon. Friend makes a good point, and I did intend to touch briefly on the governance of master trusts and fit and proper individuals. The hon. Member for Ashton-under-Lyne spoke at length about master trusts and raised several concerns, so I assure her that master trusts already have to meet a number of governance requirements under the current law. A voluntary master trust assurance framework has been developed by the Institute of Chartered Accountants in England and Wales in partnership with the Pensions Regulator. It is designed to help trustees to assess the quality of their scheme against an industry-wide quality benchmark. It also helps employers to find a well run pension scheme that can be used to comply with their automatic enrolment duties. The Department for Work and Pensions and the Pensions Regulator are exploring whether additional protections would be appropriate for the future regulation of this part of the market.

Well run master trusts can and do offer good deals for consumers and employers, and we are keen that the market develops in the right way. We are aware that potential issues have been suggested and we are working with the Pensions Regulator to ensure that the right protection is in place. Once the measures are firmed up, we will inform the public.

[Angela Rayner]

Does the Minister know how many master trusts have signed up to the voluntary arrangement and how many are yet to do so?

[Mr Vara]

I do not have a specific figure to hand. The hon. Lady suggested a number of figures, but I want to be careful before I commit myself to any specific number—[Interruption]—although it is my understanding that it may be five. That is my present assumption.

The Government agree that it is important that members’ interests are represented and their views considered. Requirements from April 2015 ensure that independent governance committees and multi-employer scheme boards have arrangements in place to ensure that members’ views are directly represented. Annual chair statements must also include the details of those arrangements. As for contributions paid, the Pensions Regulator works with the industry to monitor the ongoing payment of contributions.

I am grateful for Members’ contributions this morning. The regulations that we have put forward will improve the management of the pensions industry generally. Good governance is fundamental in securing good outcomes for members, and the regulations will help ensure that schemes are well run in members’ interests.

Question put and agreed to.

Transitional State Pension Arrangements for Women

Angela Rayner Excerpts

Wednesday 24th February 2016 Commons Chamber

[Angela Rayner (Ashton-under-Lyne) (Lab)]

It is absolutely great to follow the excellent speech made by the hon. Member for Foyle (Mark Durkan).

Enormous interest has been expressed in this issue by Members on both sides of the House, not least thanks to the sterling work of the WASPI campaigners and the 154,000 people who signed their petition. As the Minister knows, there was standing room only during the Westminster Hall debate on the subject—it was the first Westminster Hall debate in which I took part as the shadow Minister—because the subject was of significance to all Members. We heard from many about the women who feel ill-prepared and short-changed by the failure to communicate and to deliver full transitional arrangements.

Members have made some excellent points today, illustrating the stark reality that is faced by the many women who are trying to plan for their retirement in the context of these changes. Members in all parts of the House made passionate speeches on behalf of their constituents. I particularly thank my hon. Friends the Members for Denton and Reddish (Andrew Gwynne) and for Worsley and Eccles South (Barbara Keeley), and the hon. Member for Paisley and Renfrewshire North (Gavin Newlands). I also thank the hon. Member for East Worthing and Shoreham (Tim Loughton). There has been cross-party support for the WASPI women, and understanding of the difficulties that they face.

I know that it is sometimes difficult for Conservative Members to speak out against the Government, and I give particular credit to those who have done so: the hon. Members for Mid Bedfordshire (Nadine Dorries), for Blackpool North and Cleveleys (Paul Maynard), for Salisbury (John Glen), and for East Worthing and Shoreham. I know that it is difficult to make passionate speeches of that kind, and I thank those Members for their contributions.

I would say this to the Tories—I am sorry, the Members opposite—[Hon. Members: “They are the Tories.”] That is what we call them locally. I am being nice when I call them the Members opposite. I am referring to the hon. Members for Gloucester (Richard Graham), for Bexhill and Battle (Huw Merriman), for Weaver Vale (Graham Evans), and for Sherwood (Mark Spencer). This is not a question of racing back to the 1950s, and it is not about the 1995 changes. I say to Members, “Please read the motion.” We have offered options, and I have asked the Minister many times to give me costings for transitional arrangements. I urge Members to examine their consciences, to take account of the passionate debate that we have had, and to vote in favour of the motion.

Let me briefly mention my hon. Friends the Members for Warrington North (Helen Jones) and for Washington and Sunderland West (Mrs Hodgson), my hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds)—who is apparently a great feminist, although not as much of one as I am—[Interruption.] All right, I am sorry: perhaps he is. Let me also mention my hon. Friends the Members for Scunthorpe (Nic Dakin), for Swansea East (Carolyn Harris), for Burnley (Julie Cooper), for Ealing Central and Acton (Dr Huq), and for Heywood and Middleton (Liz McInnes). Others who spoke in support of the motion were the hon. Members for Arfon (Hywel Williams), for Paisley and Renfrewshire North, for North Ayrshire and Arran (Patricia Gibson), and for Kilmarnock and Loudoun (Alan Brown). I am so relieved that I got all those constituencies right! That, not the Minister, kept me awake at night.

Despite the views that were expressed by Members in all parts of the House, however, the Secretary of State has still refused to consider transitional protections for these women. Of course, hindsight is a wonderful thing, but it is crucial that we learn from the mistakes of the past and act accordingly. We know that the Minister’s predecessor had hoped that about a tenth of the direct savings of £3 billion would be put aside for transitional arrangements. The option that was eventually put forward as a concession—the 18-month cap—cost about a third of that. So we have a missing £2 billion, which has gone to the Treasury along with the rest of the savings. There are different options for transitional protection, and many Members on both sides of the House have suggested them today, but the Government have again failed to respond.

[Sir Peter Bottomley]

The hon. Lady has referred to the £1.1 billion, which brought the extension down from two years to 18 months and, we are told, dealt with 81% of the women affected. So only 20% roughly are left at 18 months and the cost would be up to £200 million. Can we put it to Government that that £200 million would have bought the loyalty of the rest of us this evening, but will not if they do not do that?

[Angela Rayner]

I thank the hon. Gentleman for his intervention. I hope that the Minister will answer that question. Just over £1 billion was put in. According to my research, over half of that was for men.

This is not the first time that Labour Members have asked the Government to consider these changes. As I have said, I would like to see and hear what the Government have done to look at transitional arrangements. We have had many debates in the House on the matter and, as Members have rightly said, this issue crosses party lines.

People watching this debate today are incredibly proud of where I have come from. I was a home help and many women who pushed me into coming into the House of Commons will be watching the debate and are affected by the changes. When I stood for Parliament, I was asked, “What is your proudest moment?” I would say it is delivering equal pay and standing up for women’s rights. We have a choice today and we must do the right thing. Many Members have said that. I hope that the Minister has listened to the debate and that the Government do the right thing.

Social Security

Angela Rayner Excerpts

Monday 8th February 2016 Commons Chamber

[Angela Rayner (Ashton-under-Lyne) (Lab)]

This is the first time I have debated with the Minister at the Dispatch Box, so I welcome him to his place and thank him for his—very brief—explanation of the draft proposals.

I want to use this opportunity to debate, clarify and scrutinise aspects of these important measures. As the Minister has outlined previously, the coalition Government legislated in the Pensions Act 2014 to introduce a new single-tier state pension for persons reaching state pension age on or after 6 April 2016.

A central principle of this legislation has been to maintain the earnings link, which was restored in the Pensions Act 2007, passed by a Labour Government. The coalition Government committed to increasing the basic state pension through the triple guarantee of earnings, prices or 2.5%, whichever is highest, from April 2011. The triple lock is a policy approach that Labour Members support—a position that was confirmed in our manifesto at last year’s general election.

Today, we are considering statutory instruments to implement and update key features of that settlement. For existing pensioners on the current state pension age scheme, the proposed 2.9% increase, which matches earnings as the highest rise of the three measures for this year, is a step in the right direction. A full basic state pension will therefore rise to £119.30 a week—an increase of £3.35.

[Andrew Gwynne (Denton and Reddish) (Lab)]

I welcome my hon. Friend to her Front-Bench position. The triple lock is all fine and well if one is in receipt of the state pension, but she will know that there is a group of women who have been deprived of their state pension, the WASPI—Women Against State Pension Inequality—women who were born in the 1950s. Does she agree that a triple lock on nothing is still nothing and that we need from this Government fair transitional arrangements for those women?

[Angela Rayner]

I thank my hon. Friend; I hope to touch on that later. I commend him and my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) for their campaigning on this issue for those women who feel that they have been let down by this Government.

The increased starting rate of £155.65 for the new flat-rate pension, to be introduced in April this year, is also broadly welcomed by Labour Members, although it is of course an increase of only 5p on the previous minimum guarantee of £155.60. Less welcome are the lack of communication, escalated timescales, poor management and utter confusion caused by what the former Pensions Minister, Steve Webb, said was meant to be “a simplified system”. Several aspects of the new legislation will have significant implications for current and future pensioners.

Under the new single-tier state pension, the Government intend that individuals qualifying for the new state pension will receive it on the basis of their own contributory record. The qualifying period to receive the full flat-rate pension goes up from the former 30 years of national insurance contributions to 35 years. There is therefore some concern about reports over the weekend suggesting that up to 4 million people retiring under the new scheme from April could receive an incorrect amount because their incomes are being calculated using data riddled with errors.

The Government are quick to jump on individuals or families who make errors in relation to tax credit or benefit claims, so it is, equally, incumbent on them to ensure that their own calculations are correct. The Minister has been prepared to set debt collectors on families who have received extra tax credit income because of the Department’s errors, so there will be understandable fear of the consequences where pensioners are overpaid due to any errors. Of course, if they are underpaid, the injustice will be obvious. It would therefore be helpful if the Minister gave us his assessment of the scale of these problems and said whether he believes that the press reports over the weekend are accurate. If the Government are encountering such problems, how does he plan to deal with them? What reassurances can he give to the millions of taxpayers potentially affected that they will get the correct amount that they were promised and are entitled to?

On a matter of equal importance, unlike the current state pension, under the new single-tier state pension an individual will no longer derive entitlement based on the national insurance record of their former spouse or civil partner. Though some transitional protection has been provided, the details are not at all clear. I am sure that Members in all parts of the House have constituents in rather desperate circumstances, trying to knit through the fog. A constituent recently contacted me. Her husband is terminally ill and on his deathbed, and he has expressed fears about what would happen to her under these transitional arrangements when he dies. They have no children, and his wife had stayed at home for many years while her husband provided for them both. She called the pensions helpline, but it was unable to offer any clarity or reassurance.

I have asked this question before, but I have yet to receive a satisfactory answer: can the Minister confirm that, in an extreme scenario, a woman with no entitlement in her own right who is widowed could end up with no state pension at all, as compared with the expected £119.95 she would have received under the current system? What are the Government doing to ensure that pensioners do not unfairly lose out and that people are given the correct information, so that they know the position they will be in? When asked how the Department was planning to communicate with those affected, the Minister for Welfare Reform, who of course sits in the other place and so is not here today, said, “You can’t foresee who is going to become widowed in future.” I think it is fair to say that that was not exactly a helpful reply. So perhaps the Minister who is with us today could provide some clarity on what action the Government are taking to communicate these changes, particularly to those with gaps in their record who are likely to be directly impacted.

[Andrew Gwynne]

My hon. Friend is making an important point about the need to communicate any changes to social security and particularly to the state pension rules. She will know that one of the complaints of the WASPI women is that they have not been adequately notified or given proper transitional arrangements. Does she think that the Government ought to be doing a lot more to communicate the changes to the new state pension arrangements because some people will not benefit from this scheme?

[Angela Rayner]

My hon. Friend is absolutely right: the Government do need to get their act together on communicating these changes. The general population out there expect nothing less than honesty and the frank information that the Government should be providing for them, so that they can make informed decisions about their future.

Will the Minister give a more specific estimate of who will be covered by transitional protection and how many people will lose out from these changes in future years? Once again, the Government’s track record on communicating pension changes falls well short of the standard that the public would hope and expect. When I met members of the National Pensioners Convention last week, they pointed out that many pensioners are now waking up to the fact that only a minority of those who reach the state pension age under the new system will receive the full flat rate of £155.65 proposed today, as confirmed by recent analysis published by the Minister’s Department. It estimates that only 37% of people reaching state pension age in 2016-17 will receive the full amount of the new state pension directly from the state. Millions of people will receive a significantly lower state pension in future, and some of them will be more than £500 a year worse off. The gloss from spinning the top-line full flat rate without the detail is rapidly starting to fade. Indeed, the Minister for Pensions herself has now admitted that the new state pension has been “oversold”.

It is clear that the Government should be doing far more to inform those affected, especially those who are nearing retirement and therefore have the least notice or time to consider the impact. In its interim report on the new state pension published in January, the Work and Pensions Committee reported:

“We heard evidence of a widespread lack of awareness among individuals about what they will receive and when. We were concerned to be told that the statements intended to rectify this were confusing and lacked necessary information.”

Age UK, among others, has called on the Government to do far more to contact people who are likely to be affected. It says:

“There are DWP materials highlighting credits and ways to increase the State Pension, but people need to know they may be affected. We believe the DWP should contact people with gaps in their record individually to highlight the changes and explain options.”

What are the Government doing to properly communicate the impact of the changes?

[Andrew Gwynne]

My hon. Friend is being generous in giving way. We also need to have confidence that the information being communicated by the DWP is correct. She will remember from last week’s Westminster Hall debate that, as recently as last week—I have not checked whether this has been changed yet—the DWP was still communicating that the state pension age for women is 60.

[Angela Rayner]

I thank my hon. Friend for making that point, which is central to what the WASPI campaigners have been arguing for some time and with which I have sympathy. The Government are failing to give adequate information and it is not readily available when people require it.

The DWP has produced analysis showing that the majority of people will be better off over the next 15 years, but what about after that? A close look at the figures reveals that, for those aged under 43 now—like me and many others in the House—the probability is that they will receive thousands of pounds less in state pension by the time they retire.

We do not hear much about the impact of the new state pension on the retirement income of future generations, and it is becoming increasingly clear why the Government are keen to keep quiet about it. Analysis that the shadow Secretary of State for Work and Pensions, my hon. Friend the Member for Pontypridd (Owen Smith), has commissioned from the Library shows that those in their 40s now are likely to be £13,000 worse off over their retirement. Men in their 30s now are likely to be nearly £17,000 worse off, while women will lose more than £18,000. For the generation in their 20s now, the loss is likely to be more than £19,000 for men and £20,500 for women. Future generations will clearly be worse off.

By 2060, when today’s 20-year-olds are nearing retirement, the Government will be spending £28 billion a year less on state pension provision. That is a huge cut, and one that has not been given proper acknowledgement by the Government or, consequently, been properly scrutinised and debated in the House or more widely.

[Kevin Foster (Torbay) (Con)]

It is interesting to hear the hon. Lady’s comments. She mentions the reduced state pension for those who are currently in their 20s, but how much of that reduction is based on the fact that the Pensions Act 2007 increased the retirement age for those who are my age and younger to 68?

[Angela Rayner]

I remind the hon. Gentleman of the coalition Government’s provisions. We had a proposal that worked for pensioners—we had a long-term plan—but the coalition Government speeded it up without any regard for the people affected by it, so I will not take any lessons from Conservative Members.

As I was saying, the £28 billion a year less that will be spent on state pension provision is a huge cut that has not been given proper acknowledgement by the Government. I hope we will debate it further in the House. Will the Minister confirm that the Government’s so-called long-term economic plan involves cutting £28 billion from pensions? What assurances can he give to today’s younger generations—who face higher housing costs, the largest fall in real wages and greater insecurity in the workplace—that they will have sufficient income in retirement?

Labour will continue to ask the Government to be far more transparent about the long-term winners and losers from the new state pension. Withholding that information may be politically advantageous in the short term, but in the long term it serves only to undermine public trust in saving for retirement, which Members on both sides of the House agree is the right course for all our population and is in the national interest.

Members on both sides of the House showed enormous interest in a related debate in Westminster Hall last week, which was triggered by more than 140,000 signatures on the petition by WASPI. There was standing room only, not, I suspect, because it was my first outing on the Front Bench, but because of the significance and importance of the issue to many Members and 2.5 million of our female constituents. Indeed, the Minister might wish to note that they include more than 4,000 women in his own constituency. I therefore hope that he will expand on the Government’s consideration of transitional protections for those women, too many of whom were not given proper notification of the acceleration in their state pension age.

The Government have failed to respond to a number of proposals, including specific solutions for the 1951 to ’53 cohort of women, who will not have access to the new state pension that we are agreeing today; for those born between 6 October 1953 and 5 April 1955, who face a delay of more than a year; and for the women born later in 1953, who have had a double whammy of changes in 1995 and 2011. What assessment have the Government carried out of those options?

Alternatively, it was suggested during the passage of the Pensions Act 2011 that maintaining the qualifying age for pension credit according to the 1995 timetable would protect some of the most vulnerable people. Have the Government reconsidered the issue since then?

Turning to another element of the regulations, I note the proposal to freeze the saving credit element of pension credit, as announced in the autumn statement. For the 438,000 pension credit recipients who receive only the saving credit element of the pension credit, their losses will not be offset by the rise in guaranteed credit. Their pension credit reward will, therefore, be reduced.

Unfortunately, the Government have so far refused to come clean about the impact on some of Britain’s poorest pensioners. According to analysis by the Institute for Fiscal Studies, 1.2 million recipients of pension credit will lose an average of £112 a year from the next financial year. That figure will be significantly higher for many people, including those in the poorest fifth of pensioner households. Will the Minister confirm that some of Britain’s poorest pensioners will be worse off as a result of the measure, and will he commit to publishing a more detailed impact assessment than that produced to date? Will he tell us exactly how many people will be worse off and by how much?

Knowledge is power, and people need to be empowered by knowledge when it comes to their retirement. I hope the Minister can provide some answers today, because that is the least that this and future generations of pensioners deserve.

--- Later in debate ---

[Mr Vara]

May I take this opportunity to welcome the hon. Member for Ashton-under-Lyne (Angela Rayner) to her new position? I look forward to discussing and debating various issues with her over the coming months. I thank her and the hon. Member for Banff and Buchan (Dr Whiteford) for their contributions. In the short time that we have, I will try to address as many of their questions as possible. I also thank the hon. Member for Denton and Reddish (Andrew Gwynne) for his one or two interventions. I am grateful to the hon. Member for Ashton-under-Lyne for welcoming the triple lock and to her party for its support for that initiative.

The issue of communication has come up repeatedly. I just want to say that there is an awareness campaign, which is particularly targeted at those aged 55 and above. They will receive a letter—their addresses will be obtained from payroll and benefits data—providing details of their own state pension. The first phase of our communications campaign aims to build awareness among those in that age group, who will be the first to reach pension age after April 2016, and we are encouraging them to get a personalised statement. Between September 2014 and October 2015, we issued nearly 500,000 personal statements. We have factsheets, infographics, videos, calculators, YouTube videos, toolkits for stakeholders and weekly stakeholder bulletins. We will continue to do whatever is necessary and whatever we can to ensure that people are made aware of what is coming. I urge all colleagues on both sides of the House to do their bit, as Members of Parliament with access to media and to local communities, to make sure that people are aware of this very important change.

It is our intention, and it will be the case, that the new state pension will be a lot simpler and clearer for people than the previous situation, when there were opt-outs in relation to the state earnings-related pension scheme and additional pensions, as well as private pensions, occupational pensions and so on. The hon. Member for Ashton-under-Lyne said that not everyone will qualify for the new rate of £155.65, and she is absolutely right, because the new state pension is based on people’s national insurance contributions. In recent years, some people have not paid full national insurance contributions to the state because they have opted out or contracted out. Some of those people contracted out into a second, additional pension, and that has to be factored in. Alternatively, the national insurance contributions that they had contracted out of were used for an occupational pension or a private pension. If the two pensions are added together, the total will in many cases be more than £155.65.

I hope that the hon. Lady and her colleagues appreciate that if we have a system in which people’s pensions are based on national insurance contributions, they cannot, if they have not paid such contributions, be expected to get the full payment due notwithstanding the fact that some of their national insurance contributions have gone to another pension. I hope she will reflect on that point.

[Angela Rayner]

I gave the Minister a specific example of someone who had not contracted out because of a second pension. Will he address that point and the fact that some people have not been given adequate notice of the changes? I appreciate the point he makes about contracted-out contributions, but some people have not been given such information. I am asking for people to be given that information so that they can make alternative provision.

[Mr Vara]

The hon. Lady will appreciate that I cannot give advice on individual cases at the Dispatch Box. As for communication, I have read out a whole list of measures we are putting in place to make sure that people are communicated with. If we were not doing our job properly, we would not have issued nearly 500,000 personal statements between September 2014 and October 2015. We continue to make sure that people are aware of the change. As I have said, she has a role to play, as do others. I am sorry that she expresses such disappointment, given that in the forthcoming year the Government will spend an additional £2.1 billion more than we are spending at present. There is also the pension credit standard minimum guarantee, which will ensure that the minimum threshold must be met. The state is there to assist people.

The hon. Member for Banff and Buchan mentioned frozen pensions. It has been the policy of successive Governments for the past 70 or so years not to uprate pensions for everyone. The issue is complex, but she will be aware that uprates are made in some countries where there is a legal obligation to do so. It should be remembered, however, that the pensions people get in some countries are based on a means test: if we gave everyone from Britain who is now resident in another country an uprate, our contribution to that uprated pension would be taken into account by their new home country and they would therefore be given less by the new home country.

Transitional State Pension Arrangements for Women

Angela Rayner Excerpts

Monday 1st February 2016 Westminster Hall

[Angela Rayner (Ashton-under-Lyne) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hanson, during my first appearance on the Front Bench in this Chamber. I debated with the Minister in Committee last week, and I welcome him back to what is no doubt the first of many exchanges here. I reassure anyone tuning in late that the broken elbow and rib that I am sporting predate this debate, and that our discussions, although heated, have been civil, although I did fear at one point for the hon. Member for Gloucester (Richard Graham).

I thank my hon. Friend the Member for Warrington North (Helen Jones) for opening this debate with a fantastic speech, and the Petitions Committee for ensuring that we could have it. Above all, I congratulate the women of the WASPI campaign, and all those who signed the petition, on their work to get us here. Their numbers are impressive, but we have revealed that the numbers affected by the issue are even greater, at more than 2.5 million nationally. Around 3,500 of those are in my constituency and, like many here, I have heard their concerns directly.

Hon. Members have made some excellent points and we can tell the level of concern from the number of contributions from both sides of the Chamber. In particular, I thank my hon. Friends the Members for Worsley and Eccles South (Barbara Keeley) and for Denton and Reddish (Andrew Gwynne) for their tireless campaigning, and all hon. Members who have contributed today. There are too many to mention in the time I have, but I will write to them all independently.

People listening to contributions made outside this Chamber may have heard the Minister for Pensions say this morning that the WASPI campaign wants to return the state pension age to 60. Let me put it on the record, as others have done, that that is not the case and it has never been advocated in my hearing. Opposition Members are not arguing for that or against equalisation of the state pension age. I hope that, instead of following such red herrings, the Government will listen to the women who are affected, and act. That is what we want to hear from them today.

Opposition Members have shared concerns about the impact of the acceleration under the Pensions Act 2011, the adequacy of the transitional protections and the communication of the changes to retirement ages generally. At one point, those concerns were shared by the Minister herself. She described the last Tory Government’s 2011 Act as a decision

“to renege on its Coalition Agreement, by increasing the State Pension Age for women from 2016, even though it assured these women that it would not start raising the pension age again before 2020.”

That is still live on her website www.rosaltmann.com. After the passage of the Act including the concession that the Minister will no doubt repeat shortly, she said that the Government

“seems oblivious to the problems faced by those already in their late fifties, particularly women”.

Will the real Ros Altmann please stand up? Apparently, she now prefers to stand up for the Government than for those women. That is a pity because the issues at stake are real and the Government give every impression of simply refusing to engage with them. Instead, we have heard repeatedly—most recently a few hours ago at Question Time—that the 18-month cap is their start and end point.

Let me set out my start point. We must take into account that many of the women who are affected by the changes have also been victims of gender inequality for most of their working lives.

[Gavin Robinson]

Will the hon, Lady give way?

[Angela Rayner]

I will not give way because I do not have much time.

The Equal Pay Act was not introduced until 1970 so many of these women began working even before the first legislative steps to ensure gender equality at work. Before I was elected to this place, I was in a traditionally low-paid, largely female workforce in social care. As an active trade unionist I fought for many years to improve pay and conditions, but even now we are a long way from achieving decent, let alone equal, wages in much of that sector.

Some of the women we are discussing today will have entered work before the 1968 strike in Dagenham. They will have been paid less than men simply because they were women. Those who are likely to have entered work earliest—those born between 6 April 1951 and 5 April 1953 —will not be eligible for the new single tier pension.

Another cohort, those born later in 1953, will have found their retirement age change twice: in 1995 and 2011—

[Mr David Hanson (in the Chair)]

Order. There is a Division in the House. We will reconvene in 15 minutes. If there is more than one Division, which is possible, we will reconvene 10 minutes after each subsequent Division.

--- Later in debate ---

On resuming—

[Angela Rayner]

Before we left, I was saying how women have been discriminated against, and continue to be discriminated against, year on year and decade upon decade.

Transitional protections were discussed and promised during the passage of the 2011 Act. We now know that the Minister’s predecessor in the coalition Government, Steve Webb, had hoped for around a tenth of the direct savings—£3 billion—to be put aside for these protections. The option that was eventually put forward as a concession —the 18-month cap—cost around a third of that amount. So we have a missing £2 billion, which has gone to the Treasury, along with the rest of the savings made from these women.

Of course, it bears repeating that the former Minister has since admitted that that decision was a bad one, made as a consequence of his not being properly briefed. It would be interesting to know whether today’s Ministers have been better briefed and whether they will make a better decision.

The Minister has often put this question back on the Opposition but consistently refused to say whether the Department has properly investigated and modelled options for additional transitional protections. For example, as my predecessor, my hon. Friend the Member for Leeds West (Rachel Reeves), stated earlier, during the passage of the 2011 Act we put forward the option to maintain the qualifying age for pension credit on the 1995 timetable rather than on the 2011 one. I hope the Minister will respond to the suggestions made earlier by my hon. Friend the Member for Warrington North and many other Members.

This debate is not the first time that I have asked what consideration the Government have made of these and other options. As the Minister will know, I have asked him in Committee, through written questions and, today, through oral questions. Despite the Government’s boast that they would be the most open and transparent Government in the world, so far we are none the wiser as to what options they have considered, let alone what the outcomes of those investigations were.

I ask the Minister again: what modelling and analysis has the Department carried out since 2011 on the potential transitional protections? Will he publish that work in full, so that we can assess it for ourselves? Will the Government then consider alternatives properly and in full, and come back with a proper response to those who have signed the petition that we are considering today and the many millions more who are similarly affected. In our view, that is the very least that they deserve.

Draft Pensions Act 2014 (Consequential and Supplementary Amendments) Order 2016 Draft State Pension and Occupational Pension Schemes (Miscellaneous Amendments) Regulations 2016

Angela Rayner Excerpts

Tuesday 26th January 2016 General Committees

[Angela Rayner (Ashton-under-Lyne) (Lab)]

It is a pleasure, Ms Buck, to serve under your chairmanship in my debut in a Delegated Legislation Committee. I thank you for your kindness in allowing me to sit down throughout the proceedings. As Members will have noticed, I am not quite operating at full capacity. I had an accident over the weekend, in which I managed to fracture my elbow and damage my ribs. I am sure that that will not stop me carrying out my duty as a member of the Opposition to scrutinise the measures before us.

[Mr Vara]

And the Whip insisted that you turn up.

[Angela Rayner]

Absolutely—the Opposition have some fantastic Whips. As the Minister outlined, in the Pensions Act 2014, the coalition Government legislated to introduce a new state pension for persons reaching state pension age on or after 6 April this year. We are considering regulations that will implement several key features of that settlement. Several aspects of the new legislation have significant implications for future pensioners, and I will touch on some of them in my contribution.

Under the new scheme, the Government intention is that individuals who qualify for the new state pension will receive it on the basis of their contribution record. The rule that allows an individual, under the current state pension, to derive entitlement based on the national insurance record of a former spouse or civil partner will end, with some transitional protection. Although the changes are likely to affect a relatively small number of people, their impact on those who are affected may be large. Perhaps the Minister will confirm that in an extreme scenario, a woman who has no entitlement in her own right and is widowed could end up with no state pension, rather than the £115.95 she could expect to receive under the current system.

In addition to the amendments on inherited graduated retirement benefit, there are new features that will affect pensioners overseas. In the new pension scheme, as the Minister outlined, state pensions will be uprated in line with earnings only if the recipient is resident in an EEA country or in a country with which the UK has a reciprocal agreement. Furthermore, many people who receive the state pension and who live abroad may have been impacted by the Government’s temperature test for the winter fuel allowance, which was introduced for the first time this winter. The changes could result in an overlap between those who become ineligible for winter fuel allowance and those whose pensions have not been uprated.

State pension deferral is of particular significance. The option to defer one’s pension in order to receive a larger amount has been part of the system since 1948. Under the new state pension, the terms of such deferral will change, resulting in a less generous return. Given that the bulk of the measures before us today are technical, I hope not to divide the Committee, but there are a number of comments that I wish to make and questions that I hope that the Minister can answer. Let me start by making the general point that the Government’s track record in communicating pension changes falls well short of what the public would hope and expect. Recent analysis that the Department of Work and Pensions published on the new state pension makes it clear that millions of people will receive a significantly lower state pension in future. Some will be more than £500 a year worse off. The Government should be doing far more to inform those affected, especially people who are nearing retirement and therefore have the least notice or time to consider the impact.

The same is true for the regulations we are considering, especially the changes to derived entitlement and inheritance rules. The regulations apply to the new state pension that will be introduced in April, so they have come before us are very late in the day, given that they arise from primary legislation that the House agreed in 2014. Perhaps the Minister can tell us why the Government have left it until now to table these measures.

In any event, Age UK, among others, has called on the Government to do far more to contact people who are likely to be affected. In its evidence to the inquiry by the Select Committee on Work and Pensions on the state pension, it said:

“There are DWP materials highlighting credits and ways to increase the State Pension, but people need to know they may be affected. We believe the DWP should contact people with gaps in their record individually to highlight the changes and explain options…In the most extreme situation, a woman with no entitlement in her own right, who is widowed, could end up with no State Pension compared to an expected £115.95 under the current system. Most will have some contributions in their own right so will not lose this much, but they could still receive significantly less than they are expecting. Couples in this situation need to be made aware of the changes as they may be able to review their retirement plans.”

When asked how the Department was planning to communicate with those affected, the Minister for Pensions replied that we cannot foresee who is going to become widowed in future. I think it is fair to say that that is not exactly a helpful response. I would be grateful if the Under-Secretary provided clarity on what action the Government are taking to communicate these changes, in particular to those with gaps in their record who are likely to be directly affected. I believe there is a pool of people they can inform who could potentially be widowed in future.

Will the Minister also give us an estimate of who will be covered by the transitional protection? How many people does he estimate will lose out as a result of the changes in future years? In the context of those facts, what would be the cost of directly contacting individuals with gaps in their national insurance record? Does the Minister think that that cost is prohibitively expensive? While these changes are likely to affect a relatively small number of people, the impacts on those affected may be very large—the Minister may wish to expand on that, based on official estimates. That is one reason why the Select Committee, in considering the draft legislation, recommended that the Government go further in finding a solution for those women who might be seriously affected.

I will not repeat the debates that were had in the House, but if the Minister can give those women any further reassurance on the terms of transitional protection, that would be welcome. In any event, it is crucial that the Government take the issue of communication far more seriously and learn the lessons from previous instances when they failed to communicate changes effectively: most notably, of course, there is a group of women born in the 1950s who were not given proper notification of acceleration in their state pension age.

On that issue, will the Minister inform us whether the Department has undertaken any further work on transitional protection for the group of women most affected? Will he commit to provide the House with details of any modelling the Government have used when looking at different options for transitional protection; for example, for specific cohorts, such as those born between 6 April and 5 December 1953, who will be particularly affected by the acceleration? He will note that I have tabled questions on that subject, but given Ministers’ stated goal of being the most transparent Government ever, perhaps he can commit to answering them fully and publishing the relevant material before Monday’s debate on the issue.

Turning to another aspect of the regulations, many people who live abroad and receive a state pension may have been impacted by the Government’s temperature test for winter fuel allowance, which was introduced for the first time this winter, as I mentioned. Will the Minister tell the Committee how many people became ineligible for winter fuel allowance as a result of these tests? What is the overlap between those who became ineligible for winter fuel allowance and those whose pensions have not been uprated?

As well as freezing overseas pensions, the Government are freezing the savings credit element of the pension credit, as announced in the autumn statement. Will the Minister confirm that some of Britain’s poorest pensioners will be worse off as a result of this measure, and will he commit to publishing a more detailed impact assessment than has been produced to date? Exactly how many people will be worse off, and by how much? Finally, on the issue of state pension deferral, how much do the Government expect to save from the changes to the deferral? How many people have chosen to defer their state pension in this financial year, and what are the Government doing to ensure that those who defer are made aware of these changes to the deferral provisions under single tier pensions? I hope that we have some substantive answers on those points and in that spirit I look forward to the Minister’s response.

--- Later in debate ---

[Mr Vara]

I do not have the precise details to hand, but I can say that it is an accepted fact that many people now use the new form—the technological advances of the 21st century—for communication purposes. We fought a general election less than a year ago in which the modern form of communication was used by politicians across the political divide. If it were the case that that was ineffective, and people were not taking note of that, we as politicians who aspire to lead and represent our constituents would probably have resorted to the old system. The fact is that the new, modern communication does work and that is why every single person in this Committee resorts to it.

As I said earlier, when DWP conducted a test in 2014 issuing 6,000 personalised letters with the aim of encouraging people to ask for a state pension statement, only 79 requests for a statement resulted from that mailshot. I think that answers the questions more than anything else.

[Angela Rayner]

May I try to help the Minister? In my contribution, I was referring to the fact that we have to learn the lessons from the past. Since becoming the shadow Pensions Minister, it is clear to me—and my mailbox makes it clear—without going into the issues of the WASPI campaign and women in the 1950s, that people do not feel that they are being communicated to in the most effective way. I urge the Minister to take all opportunities—written, social media, magazines, telephone—to do so. Whatever way he does it, it needs to be done, because of the implications for some of these people. It is not acceptable for the Minister to say, “Well, it may not affect them because they may not be a widower”. Something needs to be done to improve communication to people who are affected by these measures.

[Mr Vara]

I take on board what the shadow Minister says. Following the Pensions Act 2011—I know we are not dealing specifically with that issue—millions of people did get a letter, and the letters were sent out according to the details that were held by Her Majesty’s Courts and Tribunals Service.