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

Ian Blackford Excerpts

Tuesday 26th January 2016 General Committees

[Ian Blackford (Ross, Skye and Lochaber) (SNP)]

It is a pleasure, Ms Buck, to serve under your chairmanship. The changes to the rules on derived and inherited rights are a complex part of the reform package. In its evidence to the inquiry by the Work and Pensions Committee aimed at understanding the state pension, Age UK called on the Government to ensure that those who could be worse off due to the reforms are a priority for communications. As been referred to, communications have been a big issue in many pension matters in the past few years. A priority for communications should be to reach groups who may have planned their retirement income based on the current system but could be worse off due to the reforms. Particularly for women, the loss of derived and inherited rights to the basic pension could reduce entitlement. In the most extreme situation, a woman who is widowed with no entitlement in her own right could end up with no state pension, compared with an expected £115.95 under the current system.

Most women will have made some contributions in their own right, so they will not lose that much, but they could still receive significantly less than they expected. Couples in that situation need to be made aware of the changes so they can review their retirement plans. The Department for Work and Pensions said that as part of its communication activity, it is targeting specific groups such as the self-employed and those with low qualifying years, who may be at risk of failing the minimum qualifying period, as well as those impacted by the changes to the derived entitlement and inheritance rules. The experience of communication regarding the increase in the state pension age suggests that it is reasonable to question whether the Department should not go further and, as recommended by Age UK, directly contact individuals with gaps in their national insurance record.

Like the Labour spokesperson, we remain concerned over the whole WASPI—women against state pensions inequality—issue. There was a debate a number of weeks ago in the Chamber, when the House divided and expressed its opinion clearly by 158 votes to zero. What is parliamentary democracy if the Government feel they can ignore the will of the House? Finally, on frozen pensions, we remain concerned that those who have an entitlement to a UK pension are being denied their full rights. If we do not get sufficient answers this afternoon, the Scottish National party will oppose these measures.

--- Later in debate ---

[Mr Vara]

I do not think anyone in the Committee would expect me to give precise numbers about how many emails have been sent out by a specific Department. If I may remind the hon. Gentleman, his original question was what are the forms of communication. That is the question I answered. If he now wishes to change the question and say he wants specific numbers, because he is not happy with the answer I gave, I think the Committee will be sympathetic to the response that I cannot give the precise number of emails that have been sent out.

[Ian Blackford]

This is a massively important point. Anyone who is involved in an occupational pension scheme or any other type of scheme, will be used to getting annual letters telling them exactly what their entitlements are. Given the importance of this, the Government must communicate with all potential pensioners in a fair and reasonable manner. That means that the DWP has a duty to inform such people by letter—that would be the established practice. I cannot for the life of me understand why the Minister is hiding behind data protection. The Government have a duty to make sure that people prepare adequately for their pension. The Government must take that responsibility and communicate effectively.

[Mr Vara]

I refer the hon. Gentleman to the answer I gave to the hon. Member for Birmingham, Selly Oak.

--- Later in debate ---

[Mr Vara]

There is no one specific form of communication that my Department will be looking at. We recognise the various forms of communication that exist in the modern world and we will seek to use some of those as we feel they will best target the relevant people. I take on board what the hon. Gentleman says, but it is important to recognise that there is no single form of communication that we use. We recognise that in the modern world there are various forms and communicate accordingly.

[Ian Blackford]

rose—

[Mr Vara]

I have given the hon. Gentleman plenty of opportunities. I will give way once more, but I think this point has been laboured somewhat.

[Ian Blackford]

This is a massively important point. We all understand that social media is a wonderful tool—the Minister has referred to what was done in the election campaign and so on—but we are talking about the fundamental right that people have to a pension. People have paid national insurance; they deserve to be told by DWP what they are going to get. That is not a message to be delivered by social media, it is a message that should be delivered by letter. That is the right thing to do, and the Government must do it.

[Mr Vara]

May I put on record, since we are talking about how my Department ensures that people know about the changes, as well as all the items I have just mentioned, the “Know the Facts” communication campaign focused on building awareness for those aged 55-plus, who will be the first to reach state pension age after the new state pension is introduced? That campaign encouraged people to get a personalised statement. Between September 2014 and October 2015, nearly half a million statements were issued. In the current phase of the campaign we are looking at specific groups who may need more detailed information, including people who have been contracted out, have been self-employed, may have a low number of qualifying years, or may be affected by changes to the rules on deriving an inherited state pension.

A range of products is available to help people understand the impact of the changes. These include factsheets, infographics, videos, calculators and content for PensionTube, a YouTube channel dedicated to pensions. The campaign advertising also encourages people to engage with material online, and there is a range of supporting materials on www.gov.uk. We have in place extensive stakeholder communications with third-party organisations and have held stakeholder forums, produced a toolkit for stakeholders and continue to issue weekly stakeholder bulletins. We do communicate with the relevant people outside, we will continue to do so, and we will continue to make sure that people are appreciative of the message. I commend the regulations and the order to the Committee.

Question put.