State Pension: Women

Baroness Bakewell Excerpts

Thursday 3rd December 2015 Lords Chamber

Asked by

[Baroness Bakewell]

To ask Her Majesty’s Government, in the light of the new single-tier state pension, what provision they have made for informing women in their 50s of their pension expectations.

[Baroness Bakewell (Lab)]

My Lords, I am delighted to launch this topical Question for Short Debate arising from issues that have currently swept the country and the media involving the transition to new pension arrangements. This is a small gathering, but a distinguished one, and I look forward to hearing the Minister’s response to the issues that we have to raise.

The population is ageing; we know that. Life expectancy is currently 81 in the UK, and we now expect to work longer than we once did. Retirement will come later than it used to. We also believe in equality, so it is quite right that women and men should retire at the same age. This is all right and proper, and thoroughly understood by the population of this country. Legislation towards later and equal pensions was begun in 1995 and amended in 2011. The transitional arrangements towards that desire have, however, been a disaster. Through incompetence and faulty communications, many people, mostly women, have been left totally in the dark about what to expect and, as a consequence, suddenly presented with hardship, injustice and what some of them, writing to me, have called theft. I will be giving evidence of that in just a moment.

First, the changes to the state pension to be rolled out in April next year promise a fairer deal for women, but the new figures show that of the 400,000 expected to claim the new state pension, only 20,000 women will get the full flat rate of about £155 per week. There are reasons for this. Many women will not be reaching the state pension age over those years. They once expected to, of course—they expected to until quite recently. It has come as a shock to some 700,000 of them that they will not only not receive their pension until later but, as a consequence of this delay, will be missing out on even more than they had expected.

Complicated matters get more complicated. I put it to the Minister that serious issues of communication with those affected by the changes must be addressed— and urgently. The changes begin within a year. How much immediate contact is the DWP making with those whose features depend on these changing arrangements? What advice systems exist, and what information centres? What initiatives are in place to respond to the needs of these often distraught and deprived women? Why women? Women outnumber men in the pension population, and only a minority of women reaching state pension age have been entitled to the full basic state pension. As author John Macnicol defines it, we are talking about poverty among older women.

We know that transitions can go wrong because they already have. The move to bring forward women’s pension age towards that of men has left some 700,000 women who were on the brink of reaching what they believed was pensionable age completely bereft. They have come together as a powerful lobby—Women against State Pension Inequality, or WASPI—and are finding that their cause is met with sympathy and outrage when they explain their plight.

Many dozens of them have written to me. Let me give some examples of their distress.

“I started work at the age of 15, I have never claimed a penny benefits and worked continually until reaching 57, when because of a heart condition I took early retirement on the understanding that my pension would be forthcoming in the next few years. I have never had any communications from the government about the changes”.

Another writes:

“I resigned my teaching career to care for my husband when he was diagnosed with terminal cancer. On his subsequent death at 60 years of age I have found myself with half his teacher’s pension … and no state pension at 60 as I had planned for”.

Liz writes to me:

“I started work—part time—when I was 13 and I have always worked. Throughout my working life I understood that I would be able to take my state pension at the age of 60 and planned towards this. I now have to wait until I am nearly 66. The short notice given has made it impossible to save enough to cover the shortfall … The complete lack of notice given for a specific group of women … means that they have been treated very shabbily”.

Karen writes to me:

“I am a divorced woman of 60: I have no option but to claim ESA as I cannot work due to health issues … If it wasn’t for the fact the council are paying me housing benefit I would literally be on the streets”.

Here is a man’s voice:

“So let me get this right. We expect women to have time off to have children, earn on average 80% of what men earn, and now without fair and proper warning have imposed on them to work another 6 years. Is this the price of equality for women?”.

There are many more examples. One writes:

“I have worked as a nurse since the age of 18”.

Another writes:

“I worked solidly since I was 17”.

What emerges from those letters is that these women, deprived suddenly of their expected pensions, are often ailing, looking after an ailing partner, caring for a much older parent or may themselves be frail. Many are made redundant and, at the age of 58 or 59, are in no position to find other work.

One wonders what William Beveridge, architect of the nation’s national insurance project, would make of this unexpected occasion of want and injustice. Existing plans show a complete lack of understanding of the reality of these women’s lives. They are not cheats or scroungers; they are honourable citizens who, after a lifetime’s work and often 40-plus years of contributions, are seeking the pensions to which those contributions entitle them.

Many—almost all—of the women complain that they were not informed of the changes. The department made modest protest that it had informed them. Steve Webb, the former Pensions Minister, defending the record of communications before the Work and Pensions Committee, added to his evidence:

“Did we miss some people? Probably, when you move house do you tell the DWP and tell them your new address?”.

Some people? The department missed a large part of 700,000 women. This matter of communication of pension changes to those who are entitled is still in play. The WASPI group has raised a petition of more than 40,000 signatures. Those people want their case reviewed and compensating considerations brought in to redress the injustice.

The arrival of the new single-tier pension is meant to be cost-neutral, but it is not likely to be so. The Government must examine the provisions to see whether within their revenues they cannot find ways to accommodate the needs of those women. Pension changes read as bold and logical when they are set out on paper, but they all involve transitional adaptations. That is where the Government continually fall short of what is expected. The same applies to the recent freedoms given to pensioners to access and spend their pension pots and annuities. The proposal sounded like a new freedom, and was greeted as such. Yet we already hear of plenty of scams as perhaps naive older people are offered unrealistic promises by unscrupulous operators. Announcements of policy are all very well, but they are only the start. Will the Government undertake to remedy the many shortcomings to their communication with, and advice to, the pensioners of this country?