State Pension Age (Women)

Baroness Keeley Excerpts

Thursday 7th January 2016 Commons Chamber

[Barbara Keeley (Worsley and Eccles South) (Lab)]

First, I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on her outstanding opening speech, and the Backbench Business Committee on allocating time for this important debate. I am heartened to see the support from my Front-Bench colleagues, including my neighbour, my right hon. Friend the Member for Leigh (Andy Burnham), and my hon. Friends the Members for Oldham East and Saddleworth (Debbie Abrahams) for Newcastle upon Tyne North (Catherine McKinnell) and for Stretford and Urmston (Kate Green)—she is also my neighbour. I know that they all strongly support this campaign and the women in their constituencies who are affected by this issue. I congratulate the WASPI campaigners, who have worked tirelessly on this issue. They have now gained 107,000 signatures—perhaps 108,000 since the start of this debate.

The increases in the state pension age made by the Pensions Act 1995 and the Pensions Act 2011 have had a disproportionate impact on 1950s-born women. As we have heard, many received little or no notification of the changes, despite the Government saying that people must have 10 years’ notice of such changes. Indeed, the financial journalist Paul Lewis found that none of the 1950s-born women had been given 10 years' notice. In the worst case—we have heard about one of the worst cases from my hon. Friend the Member for Bishop Auckland (Helen Goodman)—women were told at 57 and a half that their pension age would rise from 60 to 66. Women who expected to retire at 60 can now find themselves without a job, without a pension and without money to live on.

The former Pensions Minister, Steve Webb, has admitted that the Government made “a bad decision” over these changes. His excuse was that Ministers had not been properly briefed. It appears that civil servants did do a poor job on this legislation; astonishingly, the impact assessment for the 2011 Act states in its conclusion:

“Overall…based on the available evidence, the change to the previous timetable will not have a disproportionate impact on any group compared to another.”

[Dr Huq]

The fact that my hon. Friend had a recent debate in Westminster Hall on this very subject should send a message to the Government that people want action on it. Does she agree with my constituent Linda Gregory, who was born in 1953 and points out that she has been working since the age of 15 and therefore is being penalised even more than people entering the workplace at the age, which is the normal standard nowadays?

[Barbara Keeley]

I absolutely agree with what my hon. Friend says and I thank her for coming to that earlier debate.

It seems unbelievable that civil servants and Ministers could believe that taking billions in pensions away from a particular group, adding years to their state pension age and then not informing them in good time would not have a disproportionate impact on that group.

[Nic Dakin (Scunthorpe) (Lab)]

I raised these concerns, which had been brought to me by the class that left Foxhills comprehensive school in 1970, on Second Reading of the Bill that became the 2011 Act. When I did so, the Secretary of State for Work and Pensions, said:

“I have had letters from the public stirred up by a number of people”—[Official Report, 20 June 2011; Vol. 530, c. 51.]

Does my hon. Friend agree that this is not just something being stirred up by a number of people, but a very real issue that we have known about for some time?

[Barbara Keeley]

I do agree with my hon. Friend and I thank him for the work he has done on this matter since that Second Reading debate. These changes are having a disproportionate impact on my constituents and on his, and I have heard from WASPI campaigners who are also badly affected. As we have heard, many have health problems that stop them working and others have given up work to care. One of my constituents affected by the changes has worked for more than 44 years and has raised two children. She suffers with osteoarthritis and she tells me that she suffered the indignity of having to attend the jobcentre, where she was told that she was only entitled to six months’ jobseeker's allowance. Unable to find work, she has to use her hard-earned savings. She has said:

“I must watch my savings dwindle on living costs rather than enjoyment, I wish I had not bothered being frugal all my life, as by the time I get my pension I will be broke or dead.”

[Mr Gordon Marsden (Blackpool South) (Lab)]

I am grateful for the sterling work that my hon. Friend and others have done on this campaign. Does she agree that there is a particular problem here for women in places such as Blackpool who have only been able to work part-time for a long period and are nevertheless having to take on some of the carer and other issues that people have described?

[Barbara Keeley]

Before the 1995 Act changes, the independent Social Security Advisory Committee said that savings made on raising the state pension age should be spent on the most vulnerable groups, with help specifically for low-paid women, women returning to work and carers. That advice was not followed. Recently, a court in the Netherlands ruled that raising the state pension age could be considered a breach of the European convention on human rights. A woman in her 60s appealed against a two-year increase in her pension age because it created an “individual and excessive burden” on her. The court found in her favour. It is welcome that some Conservative Members who voted for the acceleration of the state pension age in 2011 are now supporting the WASPI campaign. However, other Conservative Members are blaming European legislation for the shabby treatment of the pensions of 1950s-born women—but the facts are against them.

When the Minister answered the debate on 2 December, he said:

“Equalisation was necessary to meet the UK’s obligations under EU law to eliminate gender inequalities in social security provision.”—[Official Report, 2 December 2015; Vol. 603, c. 145WH.]

The same point has been made to WASPI campaigners in replies from Conservative MPs. However, research done by the House of Commons Library and my own research show that that is not the case. EU law allows countries to have differences in their state pension age, and it also allows lengthy transitional arrangements to be made.

Library research notes that directive 79/7/EEC requires

“the progressive implementation of the principle of equal treatment for men and women in matters of social security.”

[Justin Madders (Ellesmere Port and Neston) (Lab)]

My hon. Friend is making an excellent point about the fact that we need to reach a level of equality on this issue, but she is absolutely right that it is the pace of change and the transitional arrangements that are so unfair. Does she not agree that the continual changing of the goalposts goes against the sense of fair play, justice and fairness on which this country should be based?

[Barbara Keeley]

Absolutely. Furthermore, this background of EU law is not really a cause of the problem. The directive allows for different state pension ages. Indeed, article 7 of the directive specifically states that the determination of the state pension age is the right of member states. A 2007 European Commission report confirmed that different state pension ages are allowed. Equalisation of state pension ages is therefore described as “an objective to be strived for”. The Netherlands, Portugal and France have no current difference in their state pension age, but Austria and Hungary are equalising the state pension age with long transitional arrangements. In other states, a difference in pensionable age is currently maintained, or changes are being made very slowly. State pension ages will not be equalised in Poland until 2040, or in the Czech Republic until 2044. Bulgaria and Romania are retaining different state pension ages. EU law therefore allows different state pension ages and long transitional arrangements, and the Government cannot hide behind it and use it to explain what I see as a £30 billion “pensions grab” from 1950s-born women.

Transitional protections were discussed during the debates on the Pensions Act 2011 but were not brought forward by Ministers. It is worth saying that other countries have had transitional arrangements, or have amended their legislation to help specific groups. The Netherlands has a bridge pension. Italy brought in extensive pension changes, but made exemptions for people who were made redundant or who had a defined level of contributions. Later, Italy realised that public sector workers with a contracted career exit pathway risked being left with no job and no pension owing to the reforms. It then legislated six adjustments between 2012 and 2015 to protect those workers, via special derogations. The UK can and should put in place additional transitional arrangements to address the unfair consequences of this Government’s Pensions Act.

One of the unfair consequences is having to continue to pay national insurance contributions even though many 1950s-born women have already contributed for more than 40 years. Unfair differences in pensioner benefits also exist at a regional level. In November 2012, the Greater London Authority restored to Londoners aged between 60 and the state pension age the free travel that had been lost under the Pensions Act 2011. Bringing in the 60+ London Oyster card , the Mayor of London said:

“Londoners who have grafted all their lives and expected to receive free travel on retirement, quite rightly felt cheated when the age escalator removed the Freedom Pass from their grasp.”

What about women living outside London who have “grafted all their lives” and who also felt “cheated” when the 2011 Pensions Act removed both retirement and free travel from their grasp?

The UK reforms cannot be justified on the basis that the previous system was unsustainable. Historically, the UK state pension has been one of the lowest in the OECD. EU law allows transitional arrangements, so the Government cannot justify their changes by hiding behind that law. The lack of transitional arrangements in the UK for 1950s women is due to decisions made by this Conservative Government. I urge the Minister to look again at the issue and at ways of providing adequate transitional protection.

--- Later in debate ---

[Richard Graham]

A lot of people want to speak, so let me carry on for the moment.

The hon. Member for Paisley and Renfrewshire South was right to quote the previous Pensions Minister, Steve Webb, as saying that not everyone knew about this. He has accepted that, as I think we all recognise. None the less, the argument that no transitional arrangements were made—arrangements that Opposition Members are calling for—is wrong. A significant transitional arrangement and concession was made in 2011 that affected 250,000 people and cost the Government—the taxpayer—£1.3 billion, which was a significant amount of money at the time. That arrangement was made because the then Pensions Minister and the then Government recognised advice from the Department saying that the waiting time for some women born in the 1950s had increased to as much as two years, and they wanted to reduce it to 18 months to benefit those 250,000 people.

What is interesting is that while the motion calls for further transitional arrangements, it does not spell out, nor has any Member who has spoken so far spelt out, exactly what transitional arrangements are being called for. Were the intention—

[Barbara Keeley]

rose—

[Mark Durkan (Foyle) (SDLP)]

rose—

--- Later in debate ---

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

It is a pleasure to take part in this Backbench Business Committee debate. I commend the hon. Member for Paisley and Renfrewshire South (Mhairi Black) for her opening remarks and pay tribute to the WASPI campaign, particularly to Marion and Anne and all the other ladies who helped campaign on this important issue. I have worked long and hard with them over the past few months. We have had meetings with my hon. Friends the Members for Worsley and Eccles South (Barbara Keeley) and for Torfaen (Nick Thomas-Symonds). I lobbied my constituents with the WASPI group in Morrisons in Denton recently and I think that I was the first in this Parliament to raise the issue at Prime Minister’s Question Time. I am therefore glad that the subject has been brought to the Floor of the House for a full debate.

A very real injustice has been done to this group of women born in the 1950s. We can go through the history again: there have been two changes to their state pension age and, if that were not bad enough, the real injustice has been the acceleration of the process, which has left many women who were not expecting the changes having to make alternative arrangements. When it came to the private pensions of Members of Parliament, those within 10 years of their normal state pension age could remain on the old scheme, but the group of women we are considering have had no chance to put in place their alternative arrangements.

[Barbara Keeley]

Government Members have asked Opposition Members for our transitional arrangement suggestions. I made some. I gave examples from other countries: some have bridge pensions while others look after people who are made redundant. It is up to the Government, who have made the £30 billion pension grab, to come up with ideas.

[Andrew Gwynne]

My hon. Friend is right. When the Pensions Act 2011 was debated in the House of the Commons, the current Secretary of State said,

“but we will consider transitional arrangements.”—[Official Report, 20 June 2011; Vol. 530, c. 52.]

Where are they? Those ladies are still waiting. It is about time the Secretary of State came to the Dispatch Box and set out those transitional arrangements, because those women cannot wait forever.

We have already had the first U-turn from the former Pensions Minister, who said that he was not properly briefed. That says a lot about the calibre of Liberal Democrat Ministers in the former coalition Government. Now we have a Pensions Minister in the other place, who was a champion for those ladies until she took the Queen’s shilling. She now says that she cannot do anything about it. What utter nonsense. What is the point of having a Minister if she cannot do anything about it? It is time that Ministers in the Department for Work and Pensions got off their backsides and did something to help those women.

Following on from my hon. Friend the Member for Swansea East (Carolyn Harris), I will give the Minister some friendly advice. I appreciate that it is not his area of responsibility but that of the noble Lady at the other end of the building who speaks on pensions. My hon. Friend likened the WASPI ladies to wasps. Wasps can be pests and nuisances. They cannot easily be bashed away and, when that happens, they get angry and come back. If they are really annoyed, they sting and, unlike bees, they can sting more than once. Let us have some justice for these ladies; it is long overdue.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)]

I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on managing to secure this debate, which has attracted many Members on both sides of the House. I also commend all the colleagues who have taken the trouble to come here and speak today. I will try to address as many of their points as I can in the limited time available to me.

I should like to begin by reminding the House of the rationale for reforming the timetable. For our state pension system to function effectively, it has to be fair, affordable and sustainable. The changes made to the state pension age under the Pensions Act 2011 make an important contribution to achieving those aims. Gender equality is one of the main purposes of the changes to the state pension age. Under the previous system, women reaching state pension age in 2010 would spend on average 41% of their adult lives in receipt of the state pension. For men, the figure was only 31%, owing to the longer life expectancy and earlier state pension age of women.

It makes little sense for women to work to a pension age originally set in 1940 which does not reflect the employment opportunities open to them in a modern society. Changes were needed to take account of increased life expectancy and to ensure fairness for working-age people who would otherwise bear the cost of this longevity. Following sharp rises in life expectancy, the previous Government acted to address this and brought forward the timetable for rises in the state pension age. This was vital if we were to continue to meet the UK’s obligations under EU law to eliminate gender inequalities in social security provision and to ensure that the state pension remained affordable and sustainable. It is also important to look at the changes in the context of our wider pension reforms and what these mean for women.

[Barbara Keeley]

The Minister cannot have been listening to what I said earlier. A substantial proportion of what I said showed that that is not the case, although he and his colleagues are hiding behind that argument. We were not required to do that. Some EU countries are not equalising until 2040 or 2044, and some are maintaining a difference. Will he please stop hiding behind something that is not true?

[Mr Vara]

The hon. Lady should respect the views of other people, rather than simply stating that what she says is right. We are bound by EU law, but it is also right and proper that we should have gender equality, irrespective of EU law.