Social Security

Matt Rodda Excerpts

Wednesday 31st January 2024 Commons Chamber

[Debbie Abrahams]

My right hon. Friend makes a very important point, which I will come on to.

We have talked about children, but disabled people are another cohort who have been punished over the last 14 years. Again, that is disgraceful—I apologise for repeating the same phrases, but I cannot think of adequate vocabulary to express my rage about what is happening in different terms. Ethnic minority communities are also disproportionately affected.

[Matt Rodda (Reading East) (Lab)]

My hon. Friend is making a deeply important speech. Does she agree that it is also important to consider the effect poor-quality housing has on all the groups she mentions, in particular the combination of poverty and poor-quality housing, which leads to actions such as parents turning heating down?

[Debbie Abrahams]

That is a very good point. The Department for Work and Pensions has the largest spending across Government. The state pension accounts for the largest part of the Department’s spending, followed by universal credit, but third on the list is housing benefit and the support provided through the housing element of universal credit. Given that the Government are investing a large amount of taxpayers’ money in housing, one would think there was some way to safeguard its quality.

My hon. Friend the Member for Wirral South made important points about the escalation in the use of food banks. As I have said before, we did not have a food bank in Oldham before 2010; we now have several to meet the need. We are aware of the impact of poverty on the labour market, which I know is of interest to the Minister. We need a healthy labour market to be able to provide the growth we all want to see across the country, but, again, all the evidence suggests that will not happen for the reasons set out by my right hon. Friend the Member for Hayes and Harlington (John McDonnell).

This is becoming an increasingly unhealthy country. Our healthy life expectancy is declining and our life expectancy is declining, and that has been happening since 2017. At the time, Professor Sir Michael Marmot warned what the consequences would be, and he was right. In the report that he produced at the beginning of the year—I asked the Prime Minister a question about this just last week—he said that

“if everyone had the good health of the least deprived 10% of the population there would have been 1 million fewer deaths in England in the period 2012 to 2019. Of these, 148,000 can be linked to austerity”—

directly linked to austerity.

“In 2020, the first year of the covid pandemic, there were a further 28,000 deaths”

that could have been prevented. Those are the consequences of the poverty and inequality that we have in this country.

The Select Committee is undertaking an inquiry into the adequacy of social security support. With that in mind, I once more commend the Joseph Rowntree Foundation and the Trussell Trust, which have put together some interesting recommendations on the essentials guarantee. They suggest that what we provide should be based on need rather than on some quite subjective view of what the level of support should be. I hope the Work and Pensions Committee can support some aspect of that. Finally, I will just mention that £120 per week for a single person, instead of the £70 currently, would be a good step in the right direction. Thank you for your latitude, Madam Deputy Speaker.

Oral Answers to Questions

Matt Rodda Excerpts

Monday 4th September 2023 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

[Matt Rodda (Reading East) (Lab)]

As inflation rises, being able to top up pension contributions is vital for many part-time workers, who would otherwise not be able to claim the full state pension. However, a Daily Mail investigation showed that the Government are failing to accurately record people’s top-up contributions. Pensioners are terrified that their money has simply disappeared, so when will the Government get a grip of this terrible problem? When will Ministers show that they understand the pressure on families and pensioners due to the cost of living crisis?

[Laura Trott]

With the comprehensive package of support I have talked about today, we have shown that we are taking action during the cost of living crisis to help pensioners as much as we can. We know that accuracy is the most important thing when it comes to the state pension, which is why we have taken action very quickly to correct issues where they have occurred, for example, with LEAP—the legal entitlement and administrative practices exercise. We will do the same in all such cases.

Universal Credit Deductions

Matt Rodda Excerpts

Wednesday 19th July 2023 Westminster Hall

[Matt Rodda (Reading East) (Lab)]

It is a pleasure to serve under your chairmanship, Dame Maria. I, too, congratulate the hon. Member for Glasgow South West (Chris Stephens) on securing today’s debate. The issue of deductions is both incredibly important and sadly often neglected. We often discuss the adequacy of social security as if it were simply a matter of looking at the value of benefits, which has fallen in real terms since 2010 as a result of below-inflation uprating and freezes. However, that is only part of the story.

As we have heard today, we cannot assume that people are even getting the amounts set out in benefit rates. About 2 million households, or about 42%, on universal credit have their benefits reduced below the standard rates every month to repay debt to the Government. Deductions and debt to the Government are at a scale we have never seen before and have become a routine aspect of social security administration under the current Government, and I am afraid to say that that major change to the benefits system has largely escaped scrutiny.

The official Opposition are not opposed in principle to deductions, but the problem is the scale. There will probably always be a need for benefit deductions in social security. For a start, it is unlikely that any system will ever completely eliminate incorrect benefit payments, and taxpayers expect overpayments to be recovered wherever possible. There is also—views differ on this—a role for repayable loans to smooth out the pressure of unpredictable costs, as other hon. Members have said.

We need to recognise that deductions cause hardship for many families that, by definition, are on very low incomes. The Trussell Trust reports that 57% of universal credit households that use food banks face deductions—we have heard accounts of that today. Its evidence shows that 50% of people on universal credit with deductions have had more than one day in the previous month either having only one meal or having gone without eating altogether. That compares with 26% of those without deductions. The Joseph Rowntree Charitable Trust has shown that decisions particularly hit families with children and people with limited capability for work, more than half of whom face deductions.

There is little doubt that, in the middle of the worst cost of living crisis for decades, benefit deductions are pushing families that are already struggling into destitution, as hon. Members have said. I hope Members from across the House agree that, as far as possible, the Government should aim to minimise deductions, but unfortunately the opposite seems to be happening. Nearly half of all universal credit households face deductions each month, so we need to recognise that the system is not working as it should.

One of the main reasons for that is the timing of universal credit payments—a problem that the Government were repeatedly warned about at the design stage of UC. Families have to wait five weeks for their first universal credit payment, and somehow the Government persuaded themselves that that would not be a problem for the great majority of families claiming because they would have a pay packet or savings to tide them over. According to the Department for Work and Pensions, about 60% of people making new claims for universal credit have had to take out an advance, and as of February this year, 732,000 households were paying off new claims advances.

In addition, more than 900,000 universal credit families are facing deductions for budgeting advances. In other words, nearly one in five of all UC households have had to take out a loan to get through the month. We were promised that universal credit would deal much better with fluctuations in income and need than the benefits it replaced. The fact that so many people need to take out budgeting alternatives shows that that is unfortunately far from the case.

Although deductions may be a necessity, there is no excuse for using them as a default mechanism to deal with problems that the Government have failed to address. Ministers should be trying to minimise deductions by addressing those problems at source, but that is the opposite of what the Government have actually been doing. Where deductions are unavoidable, the Government need to manage them much more sensitively, as we have heard pleas for today, and take into account households’ circumstances.

Qualitative research by the Trussell Trust states:

“Many people who have experienced government debt repayments were not supported to understand the situation they were in”—

that is a crucial point.

“They didn’t know why the money was owed, they didn’t know how much they needed to repay, and they didn’t know how long the repayments were going to last. Of particular concern was that they also didn’t know what—if any—options or choices were available to them.”

Given that deductions cause genuine hardship for so many families, we should expect the DWP to adopt a high standard of customer service. It should proactively contact claimants—I hope the Minister will address that point—take into account affordability and ensure claimants are fully aware of the scale of debt and the options available to them, but improving customer service can go only so far. Debt and deductions are playing a much bigger role in social security than they have in the past, largely because of the failure of universal credit to live up to the claims that were made for it. We should not welcome that situation at the best of times, and certainly not in the middle of the worst cost of living crisis in a generation.

--- Later in debate ---

[David Linden]

rose—

[Matt Rodda]

rose—

[Guy Opperman]

I will give way to the hon. Member for Glasgow East (David Linden). The hon. Member for Reading East has had his say.

Construction Workers: Pension Age

Matt Rodda Excerpts

Wednesday 12th July 2023 Westminster Hall

[Matt Rodda (Reading East) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate the hon. Member for Midlothian (Owen Thompson) on securing today’s debate, and I thank him for his work in this important policy area. I also thank colleagues from across the House who have taken part in the debate. I will address a number of issues, including the wellbeing of construction workers, how they can take their pension early in some cases, the importance of support for people looking for work and, indeed, the state pension age.

I turn first to the wellbeing of construction workers and those in similar industries. I think it is fair to say—I hope we all agree—that construction is clearly a very important industry. Despite improvements to health and safety, there are still significant risks to workers in the industry, and I believe that it is important for the Government to take action to protect workers and to reduce risks at work. As has been noted by the shadow Secretary of State for the future of work, my right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner), we need a new deal for working people, and an incoming Labour Government will create the right and safe conditions for proper competition and growth.

I am pleased to support the need for safety, both as a shadow Minister and as a constituency MP. There is much more to do to improve safety at work, and further action should be taken in this important area. For example, I believe that there needs to be a review of health and safety at work to make sure that outdated legislation is fit for purpose—something that I think other Members may have implied but that was not commented on. I also believe that those who are not able to work should receive support. There needs to be welfare reform to help support more people to make the breakthrough into sustained employment and, indeed, to progress in work. Without action, we risk condemning a generation to a life on the margins.

Today, unemployment is up, with 1.3 million men and women unemployed. The number of people out of work due to sickness has risen to a record high of 2.5 million, and 760,000 young people are not in education, employment or training—all at a time when we have millions of vacancies in the labour market. That is why reform is so urgent. After 13 years of Conservative Governments, too many people are trapped on welfare, sadly going nowhere. It is an unforgivable waste of their potential. We need reform, and we need new thinking.

I want to talk about the state pension and to briefly recap on some of the changes to state pension age, because there has obviously been a lengthy discussion of aspects of the policy. From the 1940s until April 2010, the state pension age was 60 for women and 65 for men. Legislation to increase the state pension age was introduced in stages, with the Pensions Act 1995 including provisions to increase the state pension age for women aged between 60 and 65 in a series of stages between April 2010 and 2020, to bring it into line with the state pension age for men. The Pensions Act 2007 made provision to increase the SPA from 65 to 68 in stages between 2024 and 2046, and the Pensions Act 2011 brought forward the completion of the increase in the women’s SPA to 65 to November 2018.

As a result of those Acts, the current timetable is for the SPA to rise to 67 between 2026 and 2028, and to 68 between 2044 and 2046. The announcement that the Government are not going ahead with accelerating the state pension age rise is welcome. It is the right decision, but it is the clearest admission yet that a rising tide of poverty is dragging down life expectancy for so many. Life expectancy appears to be stalling and even going backwards in some of our poorest communities, as was hinted at by hon. Members who spoke earlier. I am afraid that that is a damning indictment of 13 years of failure under the current Government and, indeed, the coalition Government. I hope the Minister will acknowledge that later.

The hon. Member for Midlothian has called for the state pension to be available early for some construction workers, and I appreciate that he spoke about that today. As I said, I congratulate him on securing the debate. However, I believe that the approach he suggests could lead to a series of unintended problems for the Department for Work and Pensions in administering the state pension. It is important to remember that other help is available, and I want to see the help and support improved. I would also like to make a broader point to him: it is very important that our pension system offers security and predictability for people of working age who are saving for a pension. I am grateful to him for securing today’s debate, and I look forward to hearing the Minister’s response to the matters raised.

Draft Pensions Dashboards (Amendment) Regulations 2023

Matt Rodda Excerpts

Monday 3rd July 2023 General Committees

[Matt Rodda (Reading East) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Robertson. I also thank the Minister for updating the Committee on this important matter. The Opposition support the dashboard. It is an important initiative that should offer a great deal of benefits to pension savers and the pensions industry.

However, I have noted the Minister’s remarks today, the explanatory note, the considerable delays that she has described to us, the cost overruns and the reliance on guidance—all of which is somewhat concerning. I hope that the Minister will address some questions.

Before I ask the Minister some direct questions, however, I will mention some of the valid points about the delays raised by key members of the pensions industry. Tom Selby, the head of retirement policy at AJ Bell, for example, described the delays as “hugely disappointing”. Others have described the whole dashboards project as one that has been

“beset by difficulties and delays from the get go.”

I hope the Minister will address those concerns and reassure me and colleagues across the House on the future progress of this important project.

I realise that the Minster has not been leading the project in its entirety herself; it has been a project supervised by several Ministers. I hope she will be able to update us on how she feels the delays will affect savers, how they will affect the wider pensions industry, which is a very important part of the financial services industry, and what measures she plans to use to ensure compliance.

The Minister talked about the reliance on guidance and the way that it will work, as opposed to the Government’s previous mandatory approach. Will she reassure us that she is confident about hitting the October 2026 deadline, because we have already seen significant slippage? This is a really important programme that means that pension savers can look at and understand their savings and plan for the future. That is very important at a time when there is a considerable body of evidence showing that people are not saving enough for their pensions, and that they may not know where their pension pots are. I hope the Minister can reassure me on those points.

In-work Poverty

Matt Rodda Excerpts

Wednesday 28th June 2023 Westminster Hall

[Matt Rodda (Reading East) (Lab)]

It is a pleasure to serve under your chairmanship, Sir George. I thank my hon. Friend the Member for Slough (Mr Dhesi), my Berkshire colleague, for his excellent work on this important issue. He is a doughty champion for people across our county, and is focused on his constituency. In the time allowed, I would also briefly like to thank families who are under enormous pressure at this time. They are working incredibly hard to keep up with a huge range of increases in costs, whether that is in the price of food, which has rocketed, energy costs, mortgages or rents.

I briefly want to mention some points, to which I hope the Minister will respond. I hope he will be able to direct his remarks to me, my hon. Friend the Member for Luton South (Rachel Hopkins) and my hon. Friend the Member for Slough, because we have many residents in high-cost areas who are under pressure because of the high cost of renting and buying homes in the south-east of England and other high-cost areas.

It is staggering that food prices have risen by around 20% in the past few months. Imagine the impact on most families. The cost of common staple goods, such as Weetabix, pasta, eggs and cheese, which every family rely on daily, and which are almost impossible to substitute in a weekly shop, have all gone up enormously. That is affecting people across the whole country in a most dreadful way. Families are struggling because of that, and there is no easy way to avoid it. Children are desperate for their favourite foods—they are often keen to have specific things. The cost of even own-brand items has gone up enormously.

Equally, the cost of housing has skyrocketed. I have mentioned constituents; there are those whom my hon. Friend the Member for Newport West (Ruth Jones) mentioned in a debate yesterday, who face terrible pressures in the mortgage market. I mentioned a couple of constituents who are under enormous pressure, which is common in my area. There are huge additional costs on mortgages. I spoke about a family paying £800 extra a month for a mortgage on a three-bedroom property in a suburb. Another resident, who lives in Reading town centre, is having to pay an extra £400 a month on the mortgage on her flat. She is already suffering from the cladding crisis, because of unresolved cladding problems with the property. Imagine the pressure that a person in that situation is under at this terrible time.

I hope that the Minister will broaden his response and address some of the related issues around housing and the effect on renters. Landlords are under enormous pressure to put up rents because of the increase in mortgages. That is a hugely important related issue. My hon. Friend the Member for Barnsley East (Stephanie Peacock) made an excellent point about the number of families living on very modest incomes. Rents are increasing dramatically. In the area that I represent, there has been an increase in the proportion of people who rent and a decrease in the number of people who can afford to buy because of the high cost of housing. That puts pressure on many young families, many living in terraced housing or flats in our town centre.

In addition—I hope that the Minister will respond to this—energy prices are still extremely high. We still have not seen a proper windfall tax. There is still enormous pressure on households because of that problem, which will only get worse in winter, in the colder months. It might not seem immediate to some people, but it will be a huge challenge for many residents facing enormous costs. Many people in this country still live in poorly insulated properties. In the area that I represent, we have a very large number of terraced houses, as do many British cities and towns of a similar size, such as Derby and Portsmouth; so do London boroughs, and other areas in the north of England. Much of that housing stock is poorly insulated. That is a hugely important related problem, and I hope that the Minister can update us on the Government’s action. So far, they have been woeful on that point. A series of problems has not been addressed by either the coalition Government or Conservative Governments.

Oral Answers to Questions

Matt Rodda Excerpts

Monday 19th June 2023 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

[Matt Rodda (Reading East) (Lab)]

Sadly, the figures also show that hundreds of thousands of pensioners are still missing out on pension credit. To make matters worse, this large group of pensioners is also missing out on the Government’s £900 cost of living payment, because receiving pension credit acts as a gateway to other help. Could the Minister explain why the Government designed their cost of living payments in that way? Could she explain what she will do to fix the problem, which the Government themselves created?

[Laura Trott]

I am sure that the hon. Gentleman will welcome the figures that I just announced on the uptake of pension credit. We will not have the eligibility figures for a while—hopefully, they will be out later this year. I hope we will see a rise, but in the meantime we are doing all we can—as I know is true across the House—to get as many people as possible to apply for pension credit so that they qualify for those important cost of living payments.

Terminal Illness: Early Access to Pensions

Matt Rodda Excerpts

Tuesday 2nd May 2023 Westminster Hall

[Matt Rodda (Reading East) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Sharma. I thank the hon. Member for Angus (Dave Doogan) and colleagues from across the House who have contributed to this important debate. I hope the Government will take this issue seriously and find ways to improve the lives of people with a terminal illness.

I am pleased that legislation was passed last year to support people with a terminal illness in having fast-track access to benefits. I hope that we can develop a consensus on other matters, including the related issue we are discussing today, but I would sound a note of caution following on from the debate last September on the Social Security (Special Rules for End of Life) Act 2022, where the House worked together to allow people in the last years of life to receive increased benefits. One of the challenges raised at the time was whether the Government were able to deliver on their promises, given the series of failures over the last decade. I hope that the Minister will ensure that DWP runs smoothly and that the errors we have seen in some aspects of the pensions and benefits system will be addressed, so that the people in that greatest need are protected. I ask the Minister to reassure Members that the Department will be able to provide individual pension savers and people in need with the level of service they would expect.

On the substance of the debate—early access to pensions—I want to cover two aspects in my speech: the issue of occupational pensions, and then the issue of access to the state pension, which the hon. Member for Angus mentioned. Occupational pensions play a very important role in allowing constituents to save for their retirement, and it is only right that people who have saved all their lives and contributed to the system should be able to access the money that they have saved. I understand that people with less than a year to live are already able to withdraw their entire pension in some cases, and a substantial amount in other cases, and even those who are younger may be able to take advantage of that facility through the pension freedoms that are normally available at the age of 55. I ask the Minister to reassure Members about her work with the pensions industry to develop this further, so that we can have a further discussion and perhaps gain further understanding of the possible ways to support people. Given that a great deal of many constituents’ income in retirement does not come from money that is saved through occupational pensions, it is very important that the money that people have saved is available to them at their time of need.

On the state pension, I want to put on the record my thanks to Marie Curie and other campaign groups for raising this issue. It is very important that we listen to the voices of those campaigners, and I am grateful to the hon. Member for Angus for securing the debate so that we can discuss them. I understand that the Government’s current position is not to allow early access to the state pension. I would be very grateful if the Minister confirmed that that and set out the evidence on which the decision is based. I am sure that the Department will have explored the issue in detail, and I ask her to consider publishing some of the research carried out by the Department on this matter, so that we can understand it better and have a fuller debate in future.

I want to take this opportunity to raise some other points that have been made by campaigners. I am worried by some of the research that outlines the scale of the problem that energy bills can cause those facing the awful diagnosis of terminal illness, and I am grateful to the hon. Member for Angus for mentioning that point. For example, research by Marie Curie explains that after a terminal illness diagnosis, energy bills may rise by as much as 75%. I think I heard the hon. Member refer to some of the additional medical needs, the need for greater home heating and sometimes the need for expensive equipment, such as oxygen tanks, in a person’s home. It is very important that we understand that, take it into account and see the wider needs of somebody facing an awful diagnosis and suffering a terrible challenge.

There is a lot of independent research on the consequences of living in damp, under-heated properties, which we should also bear in mind when we consider this issue. For example, the World Health Organisation estimates that about 30% of excess winter deaths are directly attributable to living in cold, damp environments, and we have to take that point into account, as well as the additional cost of heating for medical reasons and of paying for additional energy to support machinery. That is why it is really important that we take steps to reduce energy bills in a sustainable and long-term way. As the official Opposition, we are calling for energy bills to be cut for good, which should obviously start with a proper windfall tax on oil and gas giants, continuing with our long-term mission to make Britain a clean energy superpower by 2030.

Campaigners have highlighted other financial and family impacts of having a terminal illness diagnosis, and one difficult challenge faced by some families is that other forms of support may not be available to them. For example, access to paid childcare may diminish as a result of not being able to work, although a family may still need it.  I would like the Government—I hope the Minister will address this in her speech—to look at not only reforming the childcare system in broad terms but addressing the specific issue faced by those who have a family member with a terminal illness diagnosis. They should look at the need for childcare at that difficult time and at the unintended consequences of some aspects of Government policy. There is a need for wider reform because, sadly, families, children’s education and our economy are paying the price for our current childcare system.

To conclude, I hope the Government will respond and continue to work with the pensions industry. I look forward to the Minister answering my questions about her work with the industry, confirming Government policy on the state pension and committing to publish suitably informative material about the research carried out by the Department.

Oral Answers to Questions

Matt Rodda Excerpts

Monday 24th April 2023 Commons Chamber

[Madam Deputy Speaker (Dame Eleanor Laing)]

I call the shadow Minister.

[Matt Rodda (Reading East) (Lab)]

The price of food is rising by 30%, yet the Government are continuing to fail pensioners at this very difficult time: nearly 200,000 women in their 80s have been underpaid for years because of errors at the DWP; hundreds of thousands of pensioners are missing out on pension credit, as we have heard; and when pensioners do get their pension credit application in, it can take up to three months for officials in the Department to process a claim. When will the Government finally tackle this appalling pattern of failure?

Pensions (Extension of Automatic Enrolment) (No.2) Bill

Matt Rodda Excerpts

Committee stage
Wednesday 15th March 2023 Public Bill Committees

[The Chair]

The general debate. I call Matt Rodda.

[Matt Rodda (Reading East) (Lab)]

It is a pleasure to serve under your chairship, Sir Christopher. I will address my remarks purely to the amendments.

I thank the hon. Member for Glasgow East for his work on the subject. He made a deeply personal and heartfelt point about his own experience. However, there has been a wide range of discussion and debate on the matter, and I believe that this afternoon we ought to focus on the Bill itself. I am aware that time is pressing, and given the matters being discussed in the main Chamber, I will leave my remarks at that for now.

[The Parliamentary Under-Secretary of State for Work and Pensions (Laura Trott)]

It is a pleasure to serve under your chairmanship, Sir Christopher.

I have respect for the hon. Member for Glasgow East, as he knows. I listened carefully to what he said. He set out his personal story beforehand, and it is very powerful. I reiterate the points made by my hon. Friend the Member for Stoke-on-Trent North and by the hon. Member for Reading East. This was looked at as part of the 2017 review, and there will be a statutory consultation to follow it up.

--- Later in debate ---

[Margaret Ferrier]

It is a pleasure to see you in the Chair and to serve under your chairmanship, Sir Christopher. I would like to make some brief comments of support, as this Bill sits in the reserved space and naturally will apply in Scotland on Royal Assent.

We have already seen how automatic enrolment has successfully brought many more members of the public into a pension scheme, which will only serve to benefit them in later life and in retirement. Particularly as we are facing a cost of living crisis and many people are finding it much harder to put away spare cash for a rainy day, it is important and right that contributing to a pension from a younger age is made easier. For the younger generation just starting out in the workplace, retirement looks like a speck on the horizon—too far off to think about for some time yet. I am sure we all remember feeling the same; pensions were the last thing on our mind at that age. It is crucial, however, to start making those savings earlier in life, so that there is less pressure later, as retirement approaches and people have the realisation that they have not saved as much as they need.

A general lack of understanding about pensions is a real problem when it comes to future planning. Research by the Social Market Foundation has shown that most of the population nearing retirement age do not actually know how much money they will need to see them through retirement. The typical person aged 50 to 64 has pension savings that are 58% short of what they require. That adds up to a total annual savings gap of £132 billion across the country for those reaching retirement age.

I hope that this legislation, if passed, will have some positive impacts for the harder-to-reach groups in society: women, people with disabilities, and ethnic minorities. They already have substantially lower-value pension pots on average. However, I wonder whether, when eliminating the lower earnings limit for contributions and laying regulations, the Secretary of State might consider this being for employers only, and having a higher threshold for employee contributions in the light of the current economic difficulties.

I warmly congratulate the hon. Member for Stoke-on-Trent North on successfully steering his Bill through its legislative stages so far. Last year, I was lucky enough to see my own private Member’s Bill through to Royal Assent—incidentally, it was also on pensions policy—and I know how much hard work that is for the Member and for those supporting him, so well done.

[Matt Rodda]

Once again, it is a pleasure to serve under your chairmanship, Sir Christopher. I commend the hon. Member for Stoke-on-Trent North for his work on this Bill, and, indeed, other Members from across the House and the wider policy discussion about the importance of auto-enrolment. As the hon. Member for Rutherglen and Hamilton West rightly said, pensions adequacy is a very important issue facing the whole of our society; it is a matter of great importance. We should, across the House, be encouraging people to save for their future, so it is important to debate this issue today.

I particularly want to say, in the time that I have, that auto-enrolment in itself is a great public policy success of the last few years. It dates back to the work of the Pensions Commission for the last Labour Government. The coalition Government implemented this change in 2012, and there has been growth in the number of people saving for a pension as a result. That is a commendable step forward.

However, pensions adequacy remains an issue and it is important for us to continue to go forward. In doing so, we need to work in a gradual, sensible and practical way to try to encourage auto-enrolment, and to work with stakeholders such as businesses, savers themselves and, indeed, society as a whole to try to take this work forward. In that spirit, I have some questions for the Minister.

This Bill will clearly offer real advantages to many younger people, who will be saving not only a greater sum, but from an earlier point in their life. That will help to build a much better pension pot for those pension savers. My questions for the Minister are primarily about the nature of the consultation, because as we have heard, it is hugely important that we work with pension savers themselves, with employers and with other stakeholder organisations to ensure that there is consensus on this issue and that policy is developed in a sensible way. Therefore I would like the Minister to explain to the Committee a little more about the nature of the consultation: in particular, what work the Department has done to encourage pension savers, especially young people, to be aware of the potential to save more for a pension in the future; the discussion that she has had with employers, both individual employers and employer organisations; and what she will do to continue to work with them, because when this legislation is implemented, it is a step forward for them—it is a greater contribution. We need to work with them.

I would like to know what work the Minister is doing with trade unions. They have a very important part to play in the roll-out of auto-enrolment. I was glad that the hon. Member for Stoke-on-Trent North mentioned that and acknowledged the significant work that they do. I am also interested in the consultation, in so far as it has reached out to advice organisations such as Which? and many others that have an important role in the wider money and savings debate. I hope that she is discussing with them the importance of this.

My second question is about when the Department hopes to use these powers. As has been said, the Bill allows the Government the power to do this and explains how it would happen through a statutory instrument. However, the Bill does not specify when this might happen. The Minister has talked in the past about the mid-2020s. I would be grateful if she clarified how she defines mid-2020s, and whether she will take into account any other factors such as the overall performance of the economy and the nature of any continuing cost of living crisis as we approach that time.

Once again, I thank the hon. Member for Stoke-on-Trent North for his work on this matter, and I thank colleagues from across the House. I look forward to further answers from the Minister about the importance of consultation and bringing stakeholder groups with us on this important journey.

[Laura Trott]

I congratulate my hon. Friend the Member for Stoke-on-Trent North and, in absentia, the Under-Secretary of State for Transport, my hon. Friend the Member for North West Durham, on this excellent Bill, which will expand the benefits of automatic enrolment into workplace pensions to younger people and lower-paid workers.

I think we all agree that automatic enrolment has been a huge game changer in the workplace pension savings market over the past decade. Private sector workplace pension participation among eligible employees has increased by 44 percentage points since 2012, to 86% in 2021. As has been mentioned a couple of times, it has been especially transformative for women, low earners and young people, who historically have been poorly served by or excluded from workplace pensions. The proportion of women in the private sector participating in a workplace pension reached 87% in 2021, above that of men and more than double what it was in 2012.

Thanks to automatic enrolment, the overwhelming majority of eligible workers are now enrolled in a workplace pension, saving an asset for the future. Automatic enrolment is re-establishing a culture of retirement saving for a new generation. However, we know that there is more to do. The Government have made it clear that their ambition has always been to deliver on the 2017 automatic enrolment review measures. The review proposed two key measures: extending AE to young adults aged 18 to 21 by lowering the age criteria for enrolment; and removing the lower earnings limit, which would improve saving levels among low and moderate earners.

Since I took up my role as Minister for Pensions, I have been determined to make progress on AE expansion, and I am therefore delighted to confirm that the Government are supporting my hon. Friend’s Bill to do exactly that. The legislation will mean that younger workers and those who are in lower-paid employment—often because they work part time owing to personal circumstances, such as caring responsibilities—will be able to participate fully in automatic enrolment. For the first time, every worker will benefit from an employment contribution if they are enrolled or opt in; that is key to boosting the overall amounts being saved into a workplace pension. The powers in this Bill allow a Government-defined authority to deliver the changes set out in the 2017 review reforms, which Parliament has debated on numerous occasions, and I think there is broad agreement that it should become law.

On the questions from the hon. Member for Reading East, the Government are clear that implementing the expansion of automatic enrolment can only take place following consultation. That will be a consultation on the implementation approach and the timetable. He mentioned employer and employee engagement in particular. We absolutely need a full comms campaign, and—to the points raised by the hon. Member for Glasgow East—we could also look at what we can do for 16-year-olds. Even if we do not get quite where the hon. Member for Glasgow East wants us to with the age, I think there is more we can do to encourage them to opt in. We can discuss that as part of the consultation.

Trade unions were part of the original 2017 work, and I am very grateful to them for that. We have spoken to them frequently since, as we have to employer organisations. We will hold a series of roundtables now as we move towards the consultation, and we will involve them in the consultation. On timing, I would like to launch the consultation in the autumn, with this Bill going through, I hope, in the near future. I cannot say anything further than “mid-2020s”, I am afraid, but as soon as I am in a position to update the hon. Member for Reading East, I will of course do so.

Our objective is to maintain the broad political consensus for workplace pensions, which has been an important part of the success of the reforms since the beginning. The approach taken in the Bill to guarantee meaningful and detailed consultation to help implement the changes will help to build enduring support for this important work to boost the retirement aspirations of millions of our fellow citizens. Once again, I congratulate my hon. Friend the Member for Stoke-on-Trent North and I commend the Bill to the Committee.