Transitional State Pension Arrangements for Women

Debate between Ben Howlett and Natalie McGarry

Monday 1st February 2016 Westminster Hall

[Ben Howlett]

Thank you.

I think that both sides of the House agree that changes to the state pension age are necessary but, famously, when von Bismarck created the state pension in Germany in 1889 for all those of the age of 70, life expectancy was only 35, whereas a woman who reaches 65 in 2018 has a life expectancy of nearly 90 years. Increased life expectancy has presented a challenge to pension systems all over the world, and equalising the state pension age is an important step in addressing that.

[Natalie McGarry (Glasgow East) (Ind)]

Will the hon. Gentleman give way?

[Ben Howlett]

No, I will make some progress.

The reality is that there has been no shock. People have been living longer for decades, and it is frustrating that Governments of all colours have done nothing about it. In fact, during the 13 years of Labour nothing was done to remedy the issue—at least the Scottish National party has an excuse.

--- Later in debate ---

[Ben Howlett]

I thank the right hon. Lady for that intervention but, as I said, as a member of the Women and Equalities Committee and as someone who has campaigned on equalities issues for a while, I believe that the most vulnerable people need to be looked at, if the Government are to review the policy. Unequal pension ages are unfair and unsustainable in an age of greater life expectancy and of women working longer, but we must remember that there are still glaring financial inequality issues for women in this country, despite huge strides made in recent years.

[Natalie McGarry]

In some parts of my constituency of Glasgow East, life expectancy is 67, so it is simply not correct to say that life expectancy for all is increasing. As Age UK says, it is the people in the poorest areas and in the lowest-paid jobs who are disproportionately hit.

[Ben Howlett]

As I said earlier, transitional arrangements need to be made for the most vulnerable. I completely understand the hon. Lady’s position and I hope that the Minister will look into it. Indeed, in my constituency, and in the south-west in general, there is a nearly 20% difference between the earnings of men and women. My colleagues and I on the Women and Equalities Committee are currently taking evidence on that issue and we will publish a response later this month.

At my surgery last week I met with women affected by the changes, and they brought to my attention the issue of divorce and pensions. As women earn less than men they tend to save less towards their retirement and are often dependent on their spouses’ income, but the vast majority of them do not choose to consider their husbands’ pension in a divorce settlement. I hope that the Minister will consider that further issue in his summary.

Given that emotions are running high, it is important that the Government learn lessons. Although the changes are necessary, we must consider how we can better educate people about their personal finance. We must also remember that women remain economically disadvantaged in both pay and private pension provision. If we address those things we will be able to avoid a recurrence of this regrettable situation in the future. There is little doubt that we will all be living longer and we should not make the same mistakes in communicating such changes in the future.