State Pension Age

Lord McKenzie of Luton Excerpts

Wednesday 2nd March 2016 Lords Chamber

[Lord McKenzie of Luton (Lab)]

My Lords, I start by thanking the noble Baroness, Lady Altmann, for repeating the Statement delivered in the other place. One of the matters that has characterised this Government’s approach to pensions—changes to both the state and private pensions—has been the lamentable approach to communicating change. This has manifested itself in the frustrations of the WASPI group; the misunderstandings over why only a minority of those retiring after 5 April this year will receive the full rate of the new state pension of £155 per week; and issues arising from the so-called new flexibilities.

What assurance will the Minister give about not repeating the mistakes of the past when the review that is being undertaken brings forward its recommendations? The terms of reference require consideration of what a suitable state pension age is in the immediate future and over the longer term. However, the government press release states—this is what the noble Baroness said—that the review will be focused on the longer term and will not cover the existing timetable to April 2028. So can the Minister please reconcile these two positions? It is a classic case of confused communication which fuels speculation about the Government’s true intent.

Do we take it that there is no intention of revisiting with some transitional relief the position of those in their mid-50s who are adamant that they received inadequate notice of the rise in their state pension age?

The review has to take a view on how changes to state pension age rises support affordability. I ask therefore whether the triple-lock is within its scope.

We accepted the 2014 provision which required a periodic review of the pension age. We know that life expectancy is generally increasing, but we know that this does not always equate to healthy years of life. We know also that health inequalities remain stubbornly persistent. How does the Minister consider that these factors should be reflected in a fair approach to the pension age? Can the review cover an assessment of the adequacy of social security arrangements for those who cannot sustain work before reaching an extended pension age?

We wish John Cridland well with his review: transparency, consultation and a clear recognition of the need for long-term notification of any changes will be vital.

[Baroness Altmann]

I thank the noble Lord for his comments. I would like to request and invite all noble Lords to be in touch with the review, so that we can ensure lessons are learned. If noble Lords have any observations on issues relevant to the consideration of long-term changes to the state pension age and state pension age policy, this is the opportunity to do that. It will be an independent review which will consider all the relevant factors, and the reviewer will welcome such evidence. The review is about the state pension age. It is also about the longer term. I repeat that it will not consider any changes to the state pension age timetable that is already legislated for up to 2028.

[Lord McKenzie of Luton]

If the Minister will forgive me, could we just clarify that point? The terms of reference—I have a copy here—say that the review will consider:

“What a suitable State Pension age is, in the immediate future and over the longer term”.

[Baroness Altmann]

The Government have made it clear that this is about the changes for the longer term and the appropriate framework for state pension age policy. No changes will be considered and the reviewer will not be looking at making or recommending any changes to the timetable before 2028.