Transitional State Pension Arrangements for Women

John McNally Excerpts

Monday 1st February 2016 Westminster Hall

[John Mc Nally (Falkirk) (SNP)]

Thank you for your advice, Mr Hanson.

I am delighted to be able to take part in the debate today, especially as this is the day of my 65th birthday—[Hon. Members: “Hear, hear!”] Thank you. I now qualify for state pension, unlike my wife, who will not qualify, and the other women who will suffer a penalty because of the Government’s decision.

I thank the hon. Member for Warrington North (Helen Jones) for securing the debate. Before I became a Member of Parliament, I worked with and employed many women in my capacity as a small business owner in the hairdressing industry. Throughout the many years I worked with those women, I witnessed their struggles to get back to work after having children, and their subsequent efforts to juggle looking after their families with going out to work. The wholly necessary and desirable career breaks that working mothers take leave them with less pension provision than their male counterparts, assuming that the women are able to return to work. In many cases, for example, they may have, as has been mentioned, the added responsibility of an elderly relative who might be ill or otherwise require attention. Motherhood is only one aspect of gender inequality in the state pension system. The single-tier pension is not the focus of this debate, but the fact remains that the majority of people over 65 are women, yet only 22% of women who reach state pension age in 2016 will qualify for the full £155.65 rate. That cannot be acceptable. Even by 2054, women will be one and a half times more likely than men to receive less than the full amount of the single-tier pension due to a lack of sufficient qualifying years.

Women both disproportionately rely on the basic state pension and are proportionately more poorly served by it, as the women in question will know. Women’s financial independence throughout their working lives is critical, but married women have historically relied on derived pension rights from their husbands. Removing their entitlement to those rights with little notice or time to plan for the change will disadvantage many women who will not have had time to achieve the financial independence or the independent pension entitlement that they need.

During the past couple of months, like many other MPs, I have been contacted by a number of constituents and the campaign group Women Against State Pension Inequality, which has been instrumental in alerting everyone to this issue. One email that I got was from Fiona, who got straight to the point by saying that

“the legislation was rushed in too quickly without proper debate and undemocratically for my age group.”

She was born in 1955 and took partial retirement from the civil service in 2010. At the time, her decision was based on the understanding that her state pension would be payable and due at 60, but that is not now the case. The anxieties expressed by Fiona do not affect just that age group; they also affect younger people in their 40s who are extremely concerned that their pension age, which is nearly 70, will be extended once again.

These inequalities affect women born in the 1950s. Taxes are the price that we pay for a civilised society, and we willingly pay taxes in that civilised society for benefits. This Government should honour that commitment and contract.

[Mr David Hanson (in the Chair)]

Order.