Pensions Bill [Lords]

Fiona O'Donnell Excerpts

Tuesday 18th October 2011 Commons Chamber

[Jenny Willott]

Later in my speech I will move on to comments that relate to the hon. Lady’s point.

Capping the state pension age increase to a maximum of 18 months will protect 250,000 women, as we have heard, and 250,000 men. Therefore, 500,000 people will be better off as a result of the Government amendments. As we have heard, that is costing more than £1 billion. I am grateful to the Secretary of State and the Minister for managing to get £1 billion out of the Treasury. That is no mean feat. A problem with any change to the state pension is that the costs are in the billions, not the millions.

[Fiona O’Donnell (East Lothian) (Lab)]

Will the hon. Lady give way?

[Jenny Willott]

I will make some progress first.

That problem makes it extremely difficult for small changes to be made. Given the financial circumstances, with the issues of debt and deficit that we have discussed, and the fact that other Departments are asking for money in the millions rather than the billions, convincing Treasury officials to be more generous cannot be easy. I hope that all hon. Members appreciate that the £1 billion going to these 500,000 people is a significant amount of money that has been found by the Government.

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[Richard Graham]

I am delighted to be called to speak in the debate. I welcome amendments 13 and 14, which show that the Government have listened to their people, and I congratulate the Secretary of State and the Pensions Minister on successfully providing some relief to women in their 50s in my constituency. I pay tribute to all those from Gloucester who came to see me about this issue, led by Patsy Toleman, and to those who were encouraged by the campaign led by Age UK to write to me about it.

Like others on both sides of the coalition Government, I have been very active in writing to and making the case personally to the Secretary of State and the Chancellor, and I am sorry that the Opposition have been less than generous in their recognition of the value of capping at 18 months the increase in the wait for their pension for 250,000 women. They should perhaps be reminded that Age UK has said that

“we can’t emphasise enough the great achievement that this change represents as it will cost the Government £1 billion in lost cuts to expenditure.”

[Fiona O’Donnell]

Will the hon. Gentleman give way?

[Richard Graham]

I will be more generous than the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont) was earlier; I will give way.

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[Fiona O’Donnell]

I thank the hon. Gentleman for his generosity. He might find us ungenerous, but I wonder how many of those women who came to see him have been in touch over the past few days to tell him that the Government have gone far enough.

[Richard Graham]

I have not heard specifically from any of those who originally lobbied me on this issue. No doubt they will be hearing this debate, and I think that they will recognise, as all Members should do, that the Government cannot simply brush aside the issue of expenditure as those on the Opposition Front Bench did when they were in government. The interest that all our families are having to pay on the mountain of national debt built up by the hon. Lady’s party over the past 13 years means that an amount greater than the entire education budget is being spent on debt interest alone. That affects every woman in her constituency and in mine.

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[Dame Anne Begg]

I may be Chair of the Select Committee, but I am afraid that I have no direct say in what should be in a Labour or any other manifesto. However, common sense tells us that whoever is in power after the next election—the Liberal Democrats might have a majority then, and might want to reverse the arrangement—voting against the amendment tonight will remove any chance of our ever finding a solution for this group of women. Events will have moved on, the timetable will have been set, and the pension age will have already changed by the time of the next election. That is what I mean about the lack of time in which to plan.

I hope that Members will accept that it is wrong that this anomaly has been created. I hope that those who have listened to the women in their constituencies will do the right thing tonight, and will vote for the Opposition amendment. That is what I shall be doing.

[Fiona O’Donnell]

I am genuinely grateful for the opportunity to support the amendment to which my hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont) spoke so eloquently. I welcome him to the Dispatch Box.

Many women in my constituency have contacted me about this issue, and none of those who have contacted me over the weekend, yesterday or today have expressed the view that the Government have gone far enough; they all support the amendment. I found it almost stomach-turning to hear the hon. Member for Cardiff Central (Jenny Willott) congratulate herself on winning this concession from the Government. I do not think that even Labour Members should take credit for the achievement—lacking though it is in ambition—and I certainly do not think that the Liberal Democrats should do so. I wish that some of the honourable and good Liberal Democrat members of the Bill Committee mentioned by my right hon. Friend the Member for Croydon North (Malcolm Wicks) had had the guts and the principle to propose similar amendments when they had the opportunity. This feels a bit like Groundhog Day: it is the Health and Social Care Bill all over again.

Credit for the victory, such as it is, lies with all the women who have written to us, e-mailed us, telephoned us, and come to the House to make their case. They have said, “We will not sit back and let the Government do this to us.” Every evening as I leave this place, I see a touching reminder in the poster in the tube station showing those women, although I must confess that at first I considered it rather strange that there was also a man in the photograph, and wondered what that could be about. The fact is that this change will have an impact not just on the women concerned, but on the families for whom they have made plans. In the light of the rising cost of child care, they have asked themselves, “When can I help my sons and daughters to make better lives for themselves and their families?” I have to say that I think my sons and my daughter have similar plans for me, which I intend to resist for as long as possible.

The Government, particularly the Liberal Democrats, have not just broken their promise to women; they have broken their promise to their families as well. What an appalling lack of ambition from a Government! They have repeatedly called on Labour Members to say how we would pay for our proposals, so let me give them a couple of examples. Through the future jobs fund, they could take a million young people off the dole queue so that they were back at work and contributing to the system. They could scrap their top-down reorganisation of the NHS. They could ask the Secretary of State for Communities and Local Government whether he has any money left in the pocket where he found the bin money. This is not about arithmetic; it is about political will. It is about the Government saying, “We believe that this is something worth doing, and it is something to which we will commit ourselves.”

[Steve Webb]

Will the hon. Lady give way?

[Fiona O’Donnell]

I will gladly give way to the Minister.

[Steve Webb]

I am very grateful. We let a lot of things past, but will the hon. Lady clarify one point? She mentioned—I think I quote her accurately—getting a million young people back to work through the future jobs fund. Can she tell the House how many permanent jobs young people actually got when Labour ran the future jobs fund?

[Fiona O’Donnell]

rose—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. I think the hon. Lady knows—and the Minister certainly does—that the debate has nothing to do with the future jobs fund.

[Fiona O’Donnell]

Perhaps we can have that conversation another time. The point is that the Government do not have the political will to do something about this. In opening for the Opposition, my hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East mentioned that it is not just the Prime Minister of this Government who does not “get” women; the whole team do not “get” women.

At Prime Minister’s questions two weeks ago, I watched the Prime Minister’s Parliamentary Private Secretary gathering—almost dragging—women from their seats in order to create a female halo around the Prime Minister. He and his Government need to understand that the reason he is turning women off has nothing to do with stage management or presentation. The reason is the policies—such as the one we are discussing—which are adversely and unfairly impacting on women. I urge Liberal Democrat Members in particular, who have at times pushed the Government on this issue, to go the whole hog tonight and back the amendment.

When a Government consider an inequality impact assessment, that is not political correctness gone mad—it is not just something the previous Labour Government left for the current Government. Rather, it is about good government and good decision making, so that when a Government make a decision, they are in full possession of the facts about how that decision will impact on people.

[Gordon Birtwistle (Burnley) (LD)]

I would have some sympathy for the hon. Lady’s cause if she could explain where we might find the money to fund what she wants. [Interruption.] This is not about the future jobs fund. Will the hon. Lady tell us where the Labour party would find the cash?

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[Fiona O’Donnell]

The hon. Gentleman should be extremely grateful to me for giving way, as he has not had the courtesy to be present for the entire debate. The fact is that when this Government want to find money, they can do so.

This decision betrays an appalling lack of ambition. I understand that the Government are not doing well in growing the economy, and they are probably a little disappointed in themselves—as, indeed, others are disappointed in them. Perhaps they have little faith in this country’s ability to recover and come out of the recession, with people back in work and contributing to the state. However, none of that serves to explain why this group of 500,000 women have to pay the price. Why do they have to pay for the Government’s plan to reduce debt?

For every one of those 500,000 women who will work for longer—300,000 of them for the full 18 months—there is a real story, such as that of a woman who works in the care service and who wrote to me. If she had known a few years ago that she was going to have to work extra time, she would have got out of the care sector while she could. She thinks she can struggle on until her retirement age as it stands now, but given the physical demands of her job, she does not think she can do another 18 months of lifting and handling.

Unfortunately, the hon. Member for Gloucester (Richard Graham) has left the Chamber. He talked about women retiring at 40 and 50 and living another 60 years of retirement. He is not talking about the women we are talking about. The women who need this money most are the women this Government are hurting most.

I urge Members to consider fairness, and to consider giving these women a fair chance. This is our one opportunity to stand up for those 500,000 women—the women who have been contacting us, appealing for justice. I hope we will all do the right thing tonight.

[Several hon. Members]

rose—

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[Sheila Gilmore]

We are talking about a spending period over 10 years, so it is not equivalent to the budget in a given year. Even in those terms, we are always making choices, and I will not accept lessons from a party with many members who are publicly saying that, as quickly as possible, they want to reduce or take away the 50% tax rate. That is something they are keen to do and that is their choice. They can make the case for it, but if they bring that proposal forward, I for one will certainly oppose it. That is another way of deciding how money is going to be spent and how money is going to be collected—and that is only one example.

In an earlier intervention, I mentioned the pension tax relief system, which gives a huge amount of money to people who already have a lot of money. If someone wants to save £100 into their pension pot and they are on 20% tax, in order to get £200 tax relief they have to find £800 from their pocket, but if someone is on 50% tax, they have to find only half the amount they want to save. That is unfair; it is a subsidy to those who already have a lot of income and assets. If at the end of this decade we are finding it difficult to make ends meet and we cannot help the group of women we are talking about, perhaps we should be thinking about that system.

The women who are affected by the measure will be making exactly those comparisons. They know that choices are made in politics and that choices are made by Governments, and they know that it is not impossible for the Government to change their mind on this proposal. They did not campaign for it during the election; indeed one of my hon. Friends has suggested that it was probably drawn up in a great hurry and seemed like a good wheeze at the time, but it puts a particular burden on a group of women many of whom cannot easily afford the changes. I want to emphasise, as several of my colleagues have done, that it should not be assumed that these women have a job and can just go on doing that job, or that they will still be in that job in three, four or five years’ time.

[Fiona O’Donnell]

Does my hon. Friend agree that those 500,000 women will also be asking, “Why us? Why not the banks or the bankers?” Why are they being made to pay? This is not just a question of economics but a question of right and wrong—and this is clearly wrong.

[Sheila Gilmore]

I could not have put it better myself.

Another question that the Minister has to answer is whether the Government, in looking for the savings they plan to make by going down this road, have put into the mix the additional costs that might arise in relation to some of these women, some of whom will not be able to work and might claim benefits. Some might claim jobseeker’s allowance for a period and others might claim employment and support allowance if they are in ill health, although some of them will find that those benefits are cut off very quickly in certain circumstances because of other Government proposals. They will then be thrown back to spending any savings they may have made towards retirement.

A woman in her 50s or early 60s who finds herself in that position may not be able to claim benefit for very long. If she has a partner or has savings of any sort she will not be eligible for the means-tested benefits that come in after six months in the case of JSA and that, under Government proposals, will be lost after a year even for people who are unfit to work and are in a work-related activity group. They will find themselves eating up—literally in some cases—their savings to make it through to their postponed retirement date. Of course, at that stage, those women will no doubt have to claim additional top-ups to help their financial situation. I would like to be satisfied that the Government have taken those costs into account. The women themselves will have to meet extra costs, and so will the Government. The proposal is ill-thought-out and there has been a lot of time to rethink it. Like all the women who have been campaigning on this, I am extremely disappointed that the Government are not prepared to support our amendment tonight.

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[Fiona O’Donnell]

Will the Minister also advise those women of their right to employment and support allowance? Will he confirm that, if they claim ESA, are turned down, wait seven months—as some have in my constituency—for an appeal, and that period crosses over their entitlement date to the state pension, their appeal will still be heard and any benefits backdated?

[Steve Webb]

Perhaps the hon. Lady does not understand what I am saying. I am talking about people who will reach state pension age in seven or eight years’ time, so I am not sure that writing a letter, stating, “In the event you are on a certain benefit in seven or eight years’ time, and the delay in tribunals in such and such,” is germane to my point.

The Chair of the Work and Pensions Committee, the hon. Member for Aberdeen South (Dame Anne Begg), in a characteristically balanced contribution—[Interruption]—I spotted the balance even if nobody else did. She described the changes we are making today as a huge achievement, then said, “Well why don’t we go the whole hog,” but there are 11.1 billion reasons why we are not going to go the whole hog, and I am sure she understands that point.

The hon. Member for Edinburgh East said, “Well, I wouldn’t start from here”—and so say all of us. I do not think that any one of us would have chosen to inherit an annual deficit of £150 billion that had to be cleared up—[Interruption.] Members say from a sedentary position, “This isn’t about the deficit,” but a sequence of deficits creates a debt, which will be £1.4 trillion at the end of this Parliament, and that is both a capital sum and the interest that our children and grandchildren will have to pay, so we should take responsibility for it and tackle it.

The hon. Member for Stretford and Urmston (Kate Green) said that the Work programme does not do anything for older women, but its beauty is that providers do not get paid unless they tailor what they do to the individual in front of them. For example, we find that the biggest barrier for many potential older workers is IT skills; they are entirely job-ready but not necessarily up to speed with technology. So, if that is the barrier, the Work programme provider does not need to come to my right hon. Friend the Secretary of State for approval, as in the old days, asking whether it is on a departmental checklist; they just get on with it, help the person obtain the skills and are rewarded only if they get that individual a job.