State Pension Reform

Lord Field of Birkenhead Excerpts

Monday 14th January 2013 Commons Chamber

[Steve Webb]

The current position is that we are obliged by law to uprate by at least earnings, and our policy is to go further and have the triple lock, as is mirrored in the White Paper. The legal position in the draft Bill will be at least for earnings uprating, but all our illustrative estimates in the White Paper are indeed based on the triple lock.

[Mr Frank Field (Birkenhead) (Lab)]

I congratulate the pensions Minister and the Secretary of State on delivering the White Paper against the restriction the Treasury imposed on them—that the reform be delivered at no extra cost. So that the House and the country can understand how successful they have been in driving a coach and horses through the restriction, might the Minister tell us the largest increase in contribution that any worker will face under his scheme?

[Steve Webb]

I enjoyed the right hon. Gentleman’s column in The Guardian today. He imagined that we would make this pension reform work by not making it contributory, but I hope that I have clarified for him that people will still need 35 years of contributions or credits to draw the pension. The straight answer to his question is that the rebate is 1.4% and applies to a band of earnings from the lower earnings limit of about £5,500 to the upper earnings limit of about £40,000. It is 1.4% of that band.