State Pension: Triple Lock

Lord Sikka Excerpts

Tuesday 21st January 2025 Lords Chamber

[Baroness Sherlock (Lab)]

The noble Baroness has raised a number of important and connected questions. Let me pick a couple of them out—as many as I can in the time. First, on the distinction between those on the old basic state pension and those on the new state pension, it is not a straight read across that people on one are getting more than people on the other. As she knows, it depends, of course, on what the national insurance contribution rates were and how many years they worked. How much contribution they made determines how much they will get. It is also a fact that many people on the basic state pension were contracted out and therefore will have occupational pensions and will have paid lower national insurance contributions as a result. Whichever of those state pensions people get, we will guarantee that it will go up by the triple lock, which is a massive investment, given the economic climate, and a huge investment in pensions.

On the broader question, the noble Baroness will know that in the second stage of the pensions review we will look at the whole question of the adequacy of pensions. We need to have in our country a system designed to be built, as she knows as a former Pensions Minister, on the foundation of the state pension but with an adequate second pension coming from occupational provision. On that, auto-enrolment, investment in the system, addressing gender pay gaps, and a whole range of questions are important. I will stop talking now as I have talked for far too long. The point is that we are investing in pensioners, we will get the pensions market working and we want this to work for everybody.

[Lord Sikka (Lab)]

My Lords, despite the triple lock, some 2 million pensioners live in poverty, and those numbers will increase because pensioners who live below the poverty line will be denied the winter fuel payment. In light of that, I urge the Minister to restore the full winter fuel payment to all pensioners below the poverty line. If the Minister is going to say that there is some kind of financial black hole, I can suggest tens of ways of filling it. So can the Minister please proceed in making sure that pensioners below the poverty line get the winter fuel payment in full?

[Baroness Sherlock (Lab)]

My Lords, if my noble friend has lots of good ideas about filling in the financial black hole this Government inherited, I would certainly be glad to hear them, and so too would my colleague the Chancellor of the Exchequer. So I encourage him to make a Budget submission and I look forward to reading it.

On the question of pensioners, we were very careful. Means testing the winter fuel payment was not a decision we wanted to take, and we were careful to protect the poorest pensioners—those entitled to pension credit. Those who get pension credit can also find themselves accessing a wide range of other passported benefits that will help support them. We also managed, despite the circumstances, to find the money to maintain the household support fund and to extend it into next year, so that, if there are people still struggling, there is help for them.

There is also plenty of other help and a range of support out there for pensioners, including the warm home discount and cold weather payment. I understand how tough this is. I know that the cost of living is high but the Government are determined to do all they can to make things as easy as possible for people despite the circumstances.