State Pension Age Equalisation

Richard Graham Excerpts

Wednesday 2nd December 2015 Westminster Hall

[Richard Graham (Gloucester) (Con)]

Thank you, Mr Davies. I was not expecting to be called quite so early. It is a pleasure to join this debate, and I congratulate the hon. Member for Worsley and Eccles South (Barbara Keeley) on securing it. The key issue today is communication. I do not think anyone is arguing about the general move towards the equalisation of pension ages. Indeed, most of the decisions were made in 1995, as the hon. Lady pointed out. The issue is about how the women affected were communicated to and when.

[Dr Philippa Whitford]

I take issue with the idea that the problem is just communication. While a big part of it was that women were not given notice, in actual fact, the goalposts have moved on more than one occasion for certain women. That is a big issue, too.

[Richard Graham]

The hon. Lady is right to say that women born after April 1953 had their state pension age increase accelerated under the previous Government. Paul Lewis referred to the three waves of women affected by the changes. Nothing changed for the first wave—the 1950 to 1953 group—but things changed for women born after April 1953. It is correct to say that the state pension age was accelerated for them.

Coming back to the point on communication, it is interesting that in recent evidence to the Work and Pensions Committee, the previous Pensions Minister said that it was unclear to him at exactly what stage people affected by the 1995 Act were written to. The Minister here today referred at DWP questions to a letter writing campaign from 2009 to 2010. Can he say more about that? For example, does his Department believe that that was the first stage at which women affected were written to, or was there an earlier campaign before 2009? That would be interesting to know. To some extent, the decision in December 2013 to give people affected by future pension changes,

“at least 10 years’ notice”,

shows that the DWP has taken on board the point the hon. Member for Worsley and Eccles South made on lessons learned.

[Tim Loughton]

I agree with my hon. Friend that the principle of equalising the pension age is not what is at stake in this debate. Given the clear confusion on who was told what and when, and the fact that such changes could not be made in such an accelerated fashion now for the very reason that he just mentioned, does he not agree that some form of transitional relief should be looked upon favourably? As the hon. Member for Worsley and Eccles South (Barbara Keeley) said, it is not just the amount of pension, but the delay in other benefits, such as bus passes and free prescriptions, that negatively impacts on those women who happen to have fallen foul of the changes, simply because of when they were born.

[Richard Graham]

That is a perfectly valid point that is clearly part of the WASPI campaign, and the Minister will want to comment on it. “Transitional arrangements” is both a comfortable phrase and something with significant financial implications, and he will want to discuss that.

[Barbara Keeley]

If the hon. Gentleman looks back at Second Reading of the Pensions Act 2011, he will see that the Secretary of State promised transitional protection again and again. It was not just mentioned in passing; it was how he dealt with a lot of the interventions about the issues.

[Richard Graham]

The hon. Lady’s memory of that particular occasion is probably better than mine. Some transitional arrangements were agreed and introduced, but certainly not to the degree that I am sure the WASPI campaign would like.

[Mims Davies (Eastleigh) (Con)]

I want to reiterate the communication issue, which is exactly what people were annoyed and fed up with on the doorsteps and when I spoke to women in my constituency in Eastleigh. They had worried and planned and made provision for their future, but the change to their future had not been communicated to them. They had not expected to face hardship because they were women and had been subjected to poor communication. I hope the Minister will tell us what we can do for this group of women who are very much affected by the multiple hit.

[Richard Graham]

My hon. Friend makes a good point. Communication is at the heart of the matter. Part of the issue is about this almost impossible question: who really did receive what? I know that part of the WASPI campaign is about the many people who have said they never received the letter at all, and that will be a hard thing for the Minister or the Department to quantify. Paul Lewis, whom we saw at the Select Committee recently, said of the letters in his paper:

“Even those which did reach the correct destination may not have been read–‘more bumph from the government’ is a common reaction to such things.”

If a communication arrives at the destination but is not read or is swiftly recycled, that is a hard thing for the Government to deal with. Whether there are more effective electronic ways of communicating now that can be recorded, I do not know, but the Minister may wish to comment on that.

I hope that the Minister will respond to the point about the situation that women born in the 1950s find themselves in. There are some really difficult situations. There is no doubt about that. I can see that there is quite a good team here today in the Public Gallery to testify to that. Indeed, a lot of my own family are directly affected. None the less, because pensions are fiendishly complicated, it would be useful if the Minister could share with us some aspects of the current pensions situation, which might in a curious way help women born in the 1950s.

For example, there is a very generous rate of deferral under the old state pension system that would be applicable to women born in the 1950s. This advantageous rate means that someone can increase their pension by more than 10% a year if they defer taking the state pension. A woman born on 6 April 1951 could defer taking her state pension until the same date as her male twin by deferring for four years and thereby add more than 40% to her state pension for the rest of her life. Given the subsidised nature of the deferral scheme, many women who defer would end up with a better state pension than their male twin for the same national insurance record. That is quite a complicated thing to explain, but perhaps the Minister will confirm whether that is correct and how it might benefit some of those affected.

[Mr Gregory Campbell]

Does the hon. Gentleman agree that that presumes that the female in question is physically able to put off taking the pension and continue working? Although females on above average incomes will have some difficulty in adjusting in such a short timescale, the females on an average or below average income would find it impossible to make the adjustment to which he refers.

[Richard Graham]

Indeed. The hon. Gentleman is absolutely right.

[Geraint Davies (in the Chair)]

Order. Mr Graham, could you bring your comments to a conclusion quite quickly? I have seven other people wanting to speak.

[Richard Graham]

I will, Mr Davies. I was just taking as many interventions as possible.

The hon. Member for East Londonderry (Mr Campbell) is absolutely right. The deferral scheme depends on the individual’s circumstances. None the less, the actuaries would tell us that, on balance, most women will live longer than us men and that the four-year deferral may therefore be extremely advantageous for some people. It is just one example of the technicalities that are worth thinking about.

In conclusion, today’s debate is really important. The hon. Member for Worsley and Eccles South was absolutely right to have secured it. Women in their late 50s and early 60s are affected. There is a serious issue of communication. A lot of this will be hard to untangle, but if the Minister can shed more light on what did or did not happen between 1995 and 2009, that would help. There is a generic issue about what happens when Government communicate, but that communication is not read or is recycled. How can Government respond to that position of professed ignorance? Clearly, it would be fantastic if transitional arrangements could be delivered, but the financial cost may be considerable.

[Geraint Davies (in the Chair)]

I am afraid that I am imposing a time limit of four minutes because of the number of people who have indicated they wish to speak.