Draft Occupational Pension Schemes (Scheme Administration) (Amendment) Regulations 2016
Shailesh Vara Excerpts(8 years, 7 months ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
I beg to move,
That the Committee has considered the draft Occupational Pension Schemes (Scheme Administration) (Amendment) Regulations 2016.
As always, it is a great pleasure to serve under your chairmanship, Mr Bone. The draft regulations, which were laid before the House on 1 February, respond to stakeholders and interested parties and clarify the Government’s requirements to ensure that regulations work as intended. From April 2015, new governance requirements were introduced in the Occupational Pension Schemes (Charges and Governance) Regulations 2015 for occupational pension schemes providing money purchase benefits. They include: annual statements regarding governance; certain requirements for processing financial transactions; appointing a chair of trustees responsible for signing the annual statement; and further requirements relating to the default arrangement. Additional requirements were imposed on relevant multi-employer schemes to strengthen the independent oversight of schemes used by multiple employers.
Relevant multi-employer schemes must have at least three trustees and a majority of all trustees, including the chair, must be independent of providers of services to the scheme. Trustees must be appointed for limited terms through open and transparent recruitment processes. Those requirements do not apply when the employers are part of the same corporate group, as we consider such schemes to be closer in nature to single employer schemes and thus less likely to require such additional member protections.
We also made a temporary exemption from the additional requirements, until April this year, for schemes set up by statute. That was to enable us to carry out further work on their existing governance requirements before deciding whether the exemption should continue. The National Employment Savings Trust, known as NEST, is also exempt from the additional requirements as it already has rigorous governance requirements set by law.
The governance measures cover occupational schemes offering money purchase benefits regardless of whether they are used for automatic enrolment or not. They also exclude schemes where the only money purchase benefits offered are additional voluntary contributions.
Since those regulations came into force last April, we have received representations that the definition of “relevant multi-employer scheme” had unintended consequences by bringing some corporate group schemes within the scope of the additional governance requirements. The draft regulations will amend the definition of a multi-employer scheme to ensure that normal corporate activity does not bring a corporate group scheme within the additional requirements unless it promotes itself as open to unconnected employers.
The draft regulations will not extend the temporary exemption for multi-employer schemes set up by statute. On balance, we considered that there was no significant reason to provide a further exemption from good governance standards. However, we will give such schemes up to six months to comply with the requirements for the appointment of independent trustees.
The draft regulations will make other minor changes to ease the practical application of the governance standards. They will remove the requirement for the chair of NEST to be appointed within a three-month timeframe, as that appointment is already covered by other statutory requirements. NEST has to comply with the public appointments process. The draft regulations also allow a person or deputy chair appointed by the trustees to sign the annual statement if there is no chair in place—for example, if the chair resigns or is removed.
For some schemes, certain provisions governing the appointment of trustees are set out in their trust deeds and rules, which may conflict with the governance requirements regarding the appointment of independent trustees. To make it easier for those schemes to comply, the draft regulations will apply a statutory override where provisions in trust deeds and rules conflict with the requirements for the appointment of independent trustees in multi-employment schemes. The draft regulations also correct a typographical error in the definition of “default arrangement” in the 2015 regulations, which were inserted into the Occupational Pension Schemes (Investment) Regulations 2005.
Consideration has also been given to the Small Business, Enterprise and Employment Act 2015, so the regulations include a review clause. The review’s conclusions will be set out in a report, to be published within five years after the regulations come into force. Subsequent reports will be published at intervals not exceeding five years. The review will cover both the original governance requirements and the amendments in this instrument. The draft regulations will make important changes to clarify the scope of the governance requirements and will ensure that they are practicable for occupational pension schemes.
Mr Vara
Those who take the trouble to look at the regulations before us will find that they are specific and narrow. I intend to address the issue before us, rather than go into a general debate on pensions.
The revisions proposed today are a specific response to stakeholders and interested parties, and they are intended to improve the system that exists at the moment. I like to think that the public will welcome them, given that we are responding to the points made by them.
Mark Field (Cities of London and Westminster) (Con)
A relevant point was brought up by the Opposition spokesman in relation to a “fit and proper person”. Although I appreciate that the Minister wants to go on to a specific area, it would be useful for the Committee to be aware of some of the potential concerns. I suspect that whatever the Government are doing in this regard will be rather more robust than it is for the Football Association, for whom “fit and proper person” seems an almost meaningless phrase. None the less, given the large sums of money being held on trust for many of our constituents, it is important that at least some thought is put into that, so I look forward to hearing the Minister’s views on the matter.
Mr Vara
My right hon. Friend makes a good point, and I did intend to touch briefly on the governance of master trusts and fit and proper individuals. The hon. Member for Ashton-under-Lyne spoke at length about master trusts and raised several concerns, so I assure her that master trusts already have to meet a number of governance requirements under the current law. A voluntary master trust assurance framework has been developed by the Institute of Chartered Accountants in England and Wales in partnership with the Pensions Regulator. It is designed to help trustees to assess the quality of their scheme against an industry-wide quality benchmark. It also helps employers to find a well run pension scheme that can be used to comply with their automatic enrolment duties. The Department for Work and Pensions and the Pensions Regulator are exploring whether additional protections would be appropriate for the future regulation of this part of the market.
Well run master trusts can and do offer good deals for consumers and employers, and we are keen that the market develops in the right way. We are aware that potential issues have been suggested and we are working with the Pensions Regulator to ensure that the right protection is in place. Once the measures are firmed up, we will inform the public.
Angela Rayner
Does the Minister know how many master trusts have signed up to the voluntary arrangement and how many are yet to do so?
Mr Vara
I do not have a specific figure to hand. The hon. Lady suggested a number of figures, but I want to be careful before I commit myself to any specific number—[Interruption]—although it is my understanding that it may be five. That is my present assumption.
The Government agree that it is important that members’ interests are represented and their views considered. Requirements from April 2015 ensure that independent governance committees and multi-employer scheme boards have arrangements in place to ensure that members’ views are directly represented. Annual chair statements must also include the details of those arrangements. As for contributions paid, the Pensions Regulator works with the industry to monitor the ongoing payment of contributions.
I am grateful for Members’ contributions this morning. The regulations that we have put forward will improve the management of the pensions industry generally. Good governance is fundamental in securing good outcomes for members, and the regulations will help ensure that schemes are well run in members’ interests.
Question put and agreed to.
Lambeth County Court
Shailesh Vara Excerpts(8 years, 7 months ago)
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The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
May I say what a pleasure it is, as always, to serve under your chairmanship, Mr Gray? I commend the hon. Member for Dulwich and West Norwood (Helen Hayes) on securing this debate—we have met about the matter—and I take the opportunity to put on record that she is an extraordinarily diligent and conscientious Member of Parliament who has spoken up very effectively for her constituents in the short time that she has been an MP. I am pleased to see that we also have the hon. Members for Streatham (Mr Umunna) and for Bermondsey and Old Southwark (Neil Coyle) here today, because both of them have written to me and we have corresponded on this issue.
It is absolutely clear from today’s debate that the hon. Lady cares deeply about our courts and the delivery of justice. I want to assure her that I do, too. Before I speak about Lambeth county court, I will mention some general points. The consultation that we have just concluded ran last year and had more than 2,100 responses, all of which were carefully reviewed and analysed. I care about reforming our courts—about moving from places that have changed little since Victorian times to a modern, responsive and flexible system fit for the 21st century.
Neil Coyle
I echo the Minister’s kind words about my colleagues. I am sure that many of those respondents contacted the Minister and the Department to demonstrate their commitment to justice and modernising justice, but how many of the 2,100 responses agreed that it was sensible to close the court?
Mr Vara
I cannot give the hon. Gentleman a precise number regarding the 2,100 responses that we received, but it is fair to say that a number of them objected to closures. As I said, we carefully looked at all the responses that were given. If he gives me some time, I will say that we did actually listen to many of the points that were made—if he bears with me, I will come to that.
Despite the best efforts of our staff and the judiciary, the infrastructure that supports the administration of the courts and tribunals is inefficient and disjointed. It uses technology that is now decades old. We offer very few services online and rely on paper forms. We key in data and pass bundles of documents between agencies. When we need to take payment, we can often only accept cash or cheques. We convene physical hearings to discuss matters of process. We need to end the old-fashioned ways of working that create inefficiencies and which make it hard for the public to access justice.
That is why the Government have a significant reform programme in which there will be an investment of some £700 million over the next four years. That will transform the experience of everyone who comes into contact with the courts and tribunals. New services and new, more joined-up ways of working across the justice system will require a modern infrastructure to support them. The reforms will increase access to justice by making it swifter, easier and more efficient.
To achieve those benefits, however, we must make difficult decisions, and deciding to close a court is undoubtedly one of the most difficult. I want to emphasise that we have listened to the responses to the consultation. We have retained four courts and in one further case, we have retained one of the jurisdictions along with the building following the responses that we received. In 22 courts, we have modified the proposal in some way to reduce the impact of the closure on court users—indeed, Lambeth is one of those courts, and I will refer to specific points on that shortly.
In the case of Lambeth county court, the court is poorly used; it is only used for around 40% of its available sitting time. The building is in need of considerable maintenance, including the replacement of air conditioning, lighting and aspects of the heating and hot water system. In many respects, it is simply not fit for purpose as a modern and flexible court building.
As the hon. Member for Dulwich and West Norwood mentioned in her speech, she and I had a meeting—I thought it was very productive—following which we were able to engage in conversation with my officials and she was able to liaise with the local council, Southwark council, and there was a very productive dialogue. Unfortunately, after Southwark council had carried out a feasibility study, it came to the conclusion that county court work could not be transferred to its premises, which we were open to considering. I am, however, pleased that following the representations that she and others made, and recognising the enormous number of housing possession cases that are at Lambeth county court, we have managed to shift the work two miles down the road to Camberwell Green magistrates court. I think that is not unreasonable, in that we have listened, and I would like to think that two miles is not a huge distance.
I understand that the closure of a court has a very real impact on the court’s users, staff and judiciary, but I want to make it clear that in England and Wales, the closure of 86 courts will only reduce the proportion of citizens who will be able to reach their nearest civil or family court within an hour by car by 1% and by public transport by 5%. It is also worth pointing out that the majority of the population will never have to attend a court, and for those who do, it is likely to be a rare occurrence.
The issue of access to justice featured prominently in the hon. Lady’s speech. Being able to access courts and tribunals when required is, of course, essential, but effective access to justice is not defined simply by the proximity to a court or tribunal building. It should be defined by how easy it is for court users to access the service they need, however they choose to do that. We want to take advantage of the choice and flexibility that digital technology offers. We will move towards a system in which face-to-face hearings are required only for sensitive and complex cases. Online plea, claims and evidence systems with much wider adoption of video conferencing into court will reduce the need for people to travel to court.
Helen Hayes
It is not clear to me what the timescale is for the investment of £700 million in new technology, or whether there will be a time lag following the closure of Lambeth county court, the move to Wandsworth and the introduction of the advantages that new technology may be able to bring. Will the Minister set out the timescale and process is a little more detail?
Mr Vara
The hon. Lady raises a good point. She will appreciate that I cannot, off the cuff, give her the timetable for Lambeth court, but I can say that it is clearly very important that there is synchronisation between the closure, the transfer of work and the new digital process coming in. Otherwise, there will be an extraordinarily chaotic justice system, which is the last thing any of us want. I assure her that we will be working at pace to ensure the modernisation will work alongside any closures and transfers. She was right to raise the point and I hope I have given her some comfort.
It cannot be right that people are able to transact important aspects of their lives online—for example, completing their tax returns or doing bank transactions—but when interacting with the court having to revert to paper forms and photocopying evidence. I am keenly aware that many people who encounter our justice system do so when they are at their most vulnerable. They may be a victim or witness in a criminal case, or individuals, businesses and families trying to resolve disputes. They may have been recently bereaved or experienced family problems. Whatever the circumstances we need to make better use of technology to provide them with easier access to a more responsive system. This will benefit vulnerable users, with swifter processes and more proportionate services in many cases, which will reduce the need for potentially stressful attendances at court.
Indeed, we have a duty to offer more convenient, less intimidating ways for citizens to interact with the justice system while maintaining the authority of the court for serious cases.
Mr Vara
I am mindful that the hon. Member for Streatham spoke about security and if he wanted to intervene on that, I propose to deal with it now. He raised an important point. At present, we have a system whereby witnesses, victims and defendants can all end up on the same public transport going to the same court. Under the new and reformed court system that we envisage, we hope that evidence can be given from a video conferencing suite, perhaps in a civic building or a local police station. That would be done at an appointed time so the victim and the witness would turn up at a given time. It is likely that that suite would be much closer than the court that is dealing with the case. That must be a better and safer system.
Travel time is mentioned regularly, but given that we are moving to a system with video links, travel times will not be longer and in many cases may be shorter because people will be going to a civic centre or police station to give their evidence. That will reduce cost and time, and will be a lot more convenient.
Mr Umunna
One problem—there are several—is that the Minister cannot give my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) a timeframe for the introduction of the technologies. In his answer just now he used words such as “likely” and “may” do this or that. The problem is that the absence of the technology will create all sorts of problems for our constituents.
My second point is about the data that were collected and formed the background to the consultation. Clearly, they were collected when one of the judges was absent so were not reflective of just how busy Lambeth county court is.
Mr Vara
On the data, I assure hon. Members that the decision was based on the correct information. I hope the hon. Gentleman appreciates that, with the best will in the world, consultation on 91 courts requires human beings to put a huge amount of data into documentation. I assure him that the decision was taken on the correct information.
On my use of the words “may” and “will”, the hon. Gentleman should look at our track record. During the consultation, I met the hon. Member for Dulwich and West Norwood. Following our meeting, there was instant dialogue between my officials and Southwark council. While the consultation was still proceeding, the council came to the conclusion that it was unable to accommodate what we wanted.
It would be unreasonable for the hon. Gentleman to expect me to give a specific time, date or month. All I can say is that when we are putting in place a £700 million-plus programme of court reform throughout England and Wales, he must take it on trust that we will do our damnedest to make sure everything fits in and is timely and orderly because, if it is not, there will be one massive chaotic justice system, which is the last thing I want.
Neil Coyle
I note the absence of a specific timeframe, which is unfortunate. Perhaps the Minister will write to my hon. Friends about that. Where is the assessment of the new costs to the police and councils of providing space for the video conferencing that the Minister mentioned?
On journey times, can the Minister tell us what percentage of cases he expects members of the public will still have to attend? In my constituency, there is a growing number of controlled parking zones. Thousands of people are not allowed to own a car where they live so a massive number of people will still be expected to use public transport and, as I have said, a round trip from Rotherhithe in the rush hour will take around four hours.
Mr Vara
I am mindful that I have about two and a half minutes and I am keen for the hon. Lady to have a few minutes to sum up.
In response to the hon. Gentleman, 20 years ago it was unthinkable that people would be accessing banking services from the comfort of their kitchen table or their sitting room. They did not know they would be able to access the Inland Revenue and file their tax return from the comfort of their home. It is important to recognise that proximity to justice does not mean being in a physical building called a court. We already have online transactions taking place. We will do our best to ensure that the £700 million-plus programme works apace and that we deliver the service that we want for a 21st-century justice system that is fit for purpose.
I am grateful to the hon. Lady for securing this debate and I hope I have given her some comfort. I conclude by saying that this is a once-in-a-generation opportunity to reform our court system and that is precisely what we seek to do.
Helen Hayes
I thank the Minister for his response and for taking the time to respond in detail. On video links, as my hon. Friend the Member for Bermondsey and Old Southwark (Neil Coyle) suggested, there is serious concern about the context in which police stations are closing. I met one of my borough commanders this morning who said Brixton police station is full and there is no capacity. I am not sure the Government have a plan for that. Southwark and Camberwell councils are rationalising a number of their premises, which is probably why they have difficulties in accommodating the Court Service. It is not clear that facilities for video links will be available.
Helen Hayes
My point is about the absence of a detailed plan in the context of a very big decision. The Minister has not responded to my detailed questions about the way in which provision will work at Camberwell and I would be grateful for a written response.
This is a once-in-a-generation opportunity to change the justice system. At the moment, it is a once-in-a-generation opportunity without a plan.
State Pension Age
Shailesh Vara Excerpts(8 years, 7 months ago)
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The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
My noble Friend the Minister of State, Department for Work and Pensions (Baroness Altmann) has made the following written statement.
I am pleased to announce, under section 27(5) of the Pensions Act 2014, the appointment of John Cridland as the independent lead of the state pension age review, which the Government will report on by May 2017.
John Cridland was most recently director-general of the Confederation of British Industry (CBI). He is currently chair of the board of Transport for the North. He has previously helped to negotiate the UK’s first national minimum wage, spent 10 years on the Low Pay Commission and he was also a member of the Council of ACAS. He was awarded a CBE for services to business in 2006.
The purpose of the independent review is to make recommendations to the Secretary of State for Work and Pensions on factors to consider in arriving at future state pension age arrangements. The recommendations should be affordable in the long term, fair to current and future generations of pensioners and consistent with supporting fuller working lives. The review will be forward looking and focused on the longer term. It will not cover the existing state pension age timetable up to April 2028 which is already legislated for.
The terms of reference for the review to this statement are available on the gov.uk website.
Attachments can be viewed online at: http://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2016-03-01/HCWS562/.
[HCWS562]
Transitional State Pension Arrangements for Women
Shailesh Vara Excerpts(8 years, 7 months ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
The hon. Member for Pontypridd (Owen Smith) has just made a speech more of politics than of substance. Given that he has declared himself a contender in the event of a Labour leadership contest, it is clear that his choice of audience was more about getting nominated as a contender than about dealing with the substance of the matter at hand. [Interruption.] Labour Front Benchers are chuntering, “What about the women?” Precisely—what about the women? What about focusing the debate on the women? What about some substance? I will move on to that.
Several hon. Members rose—
Mr Vara
I will give way, but I first wish to make a little progress.
Hon. Members will be aware that the women’s state pension age was changed in 1995 to equalise it with the state pension age for men. Equalisation was then accelerated in the Pensions Act 2011, following extensive debates in both Houses of Parliament. Those changes were about bringing gender equality to pensions for the first time, about reflecting rises in life expectancy—it continues to rise for both men and women—and about taking spending on pensions to more sustainable levels.
Dr Blackman-Woods
I am grateful to the Minister for giving way, because I wanted to point out to him that the audience today is the huge number of women across the country who are adversely affected by the changes. One of them wrote to me:
“When equalization for pensions was first introduced in 1995 I was informed I could collect my State Pension at 64…however this was changed again in 2011 to…66. This is very unfair to me and the many other women it affects bearing the brunt of the changes twice”.
Labour has recognised that, which is why we have tabled a motion calling for transitional arrangements. Why is the Minister not backing us and the WASPI women on this?
Mr Vara
As far as the hon. Lady’s question—or her speech, which had a question at the end of it—is concerned, I will address those issues later in my speech. However, she is absolutely right that the audience for this debate is the women concerned. In my speech, I intend to address the substance of the subject, rather than the politics of it, which we heard earlier.
Mark Spencer (Sherwood) (Con)
Was the Minister struck, as I was, by the fact that the shadow Secretary of State, during the 30 minutes he took to set out the challenges we face, did not actually tell us what the Labour party would do, which of the six changes he would commit to, or whether he would commit to all six of them?
Mr Vara
My hon. Friend is absolutely right. The shadow Secretary of State’s speech was full of bluster and specified no options. He failed to recognise or to speak about the cost, and to explain why the issue was not in the Labour party manifesto. The luxury for the Opposition is the ability to spend money for which they are not accountable and for which they have no responsibility. The difficulty for the Government is to deal with taxpayers’ money and to take the hard decisions that are necessary.
Alison McGovern
The Minister is speaking as though we did nothing to bring this issue to the Government’s attention during the last Parliament. That is straightforwardly not true. I participated in debate after debate with my hon. Friend the Member for Leeds West (Rachel Reeves), who brought it to the Government’s attention time and again. As we have had so many debates about it, can we not just get on with talking about what we are going to do about it?
Mr Vara
I will come on to the debate we had in 2011 later in my speech. If the hon. Lady wants to talk about previous Governments, may I gently remind her of the 13 years of Labour Government, with the 10 Pensions Ministers—one Minister had the job twice—and the nine Secretaries of State for Work and Pensions? In the interests of fairness, she, along with everyone else, might wish to acknowledge the limited work, if any, that was done during the 13 years of the Labour Government to put matters right, as they put it.
Owen Smith
The Minister says that the Labour Government did limited work. May I point out that, following a freedom of information request to the Government just a couple of weeks ago, it was conceded that Labour spent more than £5 million advertising the changes and sent out 800,000 letters? That was in stark contrast to the previous Tory Government, which, frankly, did damn all.
John Redwood (Wokingham) (Con)
When it comes to equalisation, how much leeway do the UK Government have under EU law?
Mr Vara
EU law does require us to equalise pension ages. Later in my speech, I will mention countries that have already achieved what we are still endeavouring to achieve. Incidentally, the shadow Secretary of State was wrong in what he said about Germany. Germany has already achieved equalisation.
Helen Jones
The hon. Gentleman ought to recognise that although EU law requires the equalisation of pension ages, it also allows for transitional arrangements while reaching that stage. Frankly, it is disingenuous to suggest otherwise.
Mrs Anne-Marie Trevelyan (Berwick-upon-Tweed) (Con)
There are women in Northumberland who are likely to be in serious financial difficulty as a result of these changes. It will not be most of those affected, but it will be a few. My concern is for that small number of women. I would be most grateful if the Minister would agree to meet me and other Government Members to look at the small group of women who face such financial pressures.
Several hon. Members rose—
Sir Peter Bottomley
My hon. Friend is saying some fair things about the Opposition and they do not like it. Will he turn his mind to a fair thing that I want to say about the women who are directly affected? The issue is that people who were born within 12 months of each other can have retirement ages nearly three years apart. That is where better transitional arrangements are needed. We all know that this Government have had to put right many things that previous Governments have got wrong, but this is something we need to get right for ourselves.
Mr Vara
I will give way later, but I wish to make some progress.
There has been much debate about this issue, and we have had several debates about it in recent weeks. It comes down to two fundamental issues. First, there have been calls to undo the 2011 pension changes. The cost of that would be more than £30 billion. Secondly, there are calls by some to go even further and unravel the 1995 pension reforms.
Mr Vara
Yes, there are many people, including people in WASPI, who want to unravel the 1995 reforms. It is out there on the internet for people to see, so let us not try to deny the two options that are being debated out there. I said at the outset that I was going to talk about the substance of the matter, and I will talk about both those options.
Owen Smith
The Minister repeats the calumny that the WASPI women are saying, “Do not equalise pensions, and get rid of the 1995 Act.” That is exactly what the Whips’ crib sheet says, but he knows it is not true. That was one comment made by one woman among the hundreds of thousands on Facebook. It is not what WASPI said to the Work and Pensions Committee, and it is not what it said in its petition. It is not true. Will he withdraw it?
Mr Vara
I am simply speaking from my personal experience of speaking to women. There are women who have said to me that they want the restoration of the 1995 rules. Colleagues in this House have had people in their surgeries speaking of 1995. The hon. Gentleman may not have had that—he may be out of touch, but the rest of us are not. When we talk of £77 billion or even £30 billion, we are not talking about a few million pounds or a few billion pounds. In both contexts, we are talking of tens of billions of pounds. That situation is simply not sustainable.
Fiona Mactaggart (Slough) (Lab)
When the hon. Gentleman says that £30 billion was saved as a result of the 2011 changes, what he is saying is that there was a transfer from one of the poorest groups in our society, which is women in their 50s. That group of women saw the largest growth in unemployment under the coalition Government and are more likely to have to work after retirement than men. When they do so, two thirds of them work on the lowest wage levels, unlike men who work after retirement, two thirds of whom work on the highest wage levels. What does he have to say about picking the pockets of the poorest women in our society?
Mr Vara
I will address some of the points that the right hon. Lady makes, because there is a broader context to this debate, rather than simply the issue of the pension age. Given the opportunity, I would like to make some progress.
People are living longer and leading healthier lives. Of course, that is to be welcomed, but it does increase the pressure on the state pension scheme. As a Government, we have a responsibility to keep it affordable and sustainable for future generations.
Mr Vara
I would like to make some progress.
The changes that have been made are important in making the state pension scheme affordable and sustainable. They also reflect the way in which men and women lead their lives now, rather than the way they led them in the 1940s. I will come back to that point later.
First, I want to tackle one issue head-on. Many hon. Members have talked about the need for transitional arrangements. I point them towards the extensive debates and discussions that took place when the legislation passed through Parliament. Let me quote Hansard from the day on which the Pensions Bill received its Second Reading in June 2011. The Secretary of State made it very clear that equalisation of the state pension age would take place in 2018. He said that
“we have no plans to change equalisation in 2018, or the age of 66 for both men and women in 2020, but we will consider transitional arrangements.”—[Official Report, 20 June 2011; Vol. 530, c. 52.]
Yes, he said,
“we will consider transitional arrangements.”
Four months after the Secretary of State said those words, and after he had considered the matter further, a concession or a transitional arrangement—call it what you will—was indeed considered by this House and included on Report. That transitional arrangement was worth over £1 billion and reduced the delay that anyone would experience in claiming their state pension from two years to 18 months. So when people say that transitional arrangements should have been made, I simply ask them to look back at the record, to consider what was said and to consider what was subsequently done four months later. There were transitional arrangements. They passed through the House, there was extensive debate, there was extensive engagement with the relevant stakeholders and it was done.
Neil Gray
I think that this is the fourth debate I have attended in which the Minister has responded on these issues, and his answers on this injustice are still woefully inadequate. Talking of injustice, will he answer my constituent, Shiona Airlie, who is four months outside this measure and was only notified in 2012 that she would have to wait a further four years—less than a year before her 60th birthday? Where is the justice in that? How is it fair after she has paid into the system for all of her working life?
Kirsten Oswald (East Renfrewshire) (SNP)
The Minister’s description of Hansard and the discussions that took place in this House was extensive, but the ladies concerned do not know about that. It is surely unreasonable to expect them to read Hansard to understand what their pension arrangements should be. Women in my constituency are coming to my surgery to tell me of the significant changes that they and their families will experience because of this policy. It is not good enough and the Minister must listen and act.
Mr Vara
The hon. Lady is absolutely right that the public are uninterested in Hansard. My point was that people in this House who are speaking in this debate should read Hansard. Rather than simply saying, “Where are the transitional arrangements?”, they should recognise that transitional arrangements were made.
Graham Evans (Weaver Vale) (Con)
Is it not a fact that people were not aware of the Pensions Act 1995? We had 13 years of a Labour Government that spent £5 million on communication. Is it not the complete failure of the previous Labour Government that failed the women involved?
Mr Vara
My hon. Friend is right. In 13 years of government, Labour—with 10 Pensions Ministers and nine Secretaries of State for Work and Pensions— completely failed these women and now refuses to accept any responsibility or to acknowledge the arithmetic of the pensions budget. Labour Members seek to put the blame on those at this Dispatch Box without making any contrary proposals. They refuse to commit themselves. As I said earlier, the luxury of opposition is being able to speak about spending huge sums of money without having the responsibility of taking the political decisions that we have to take.
Several hon. Members rose—
Mr Vara
I have given way many times and I am afraid that we are now getting to a stage at which MPs are simply repeating points that have already been raised. I am mindful that many hon. Members wish to speak. Nobody can accuse me of not being generous in giving way, but I wish to make progress.
The changes that were made, and the transitional arrangements made in 2011, benefited a quarter of a million women who would have otherwise have had a delay of up to two years. For more than 80% of those affected, the increase in the time period will be no more than 12 months. The House voted for this amendment to the Bill and a concession was called for. A concession was considered by the Government, proposed by the Government and accepted and voted for by this House. The Government promised to consider transitional arrangements in 2011 when the legislation was going through, and that is exactly what the Government delivered—a reduction in the time period from two years to 18 months at a cost of £1.1 billion. That shows that the Government were listening to the concerns of Members and responded to them at the time.
Carolyn Harris (Swansea East) (Lab)
Exactly how much of that money went to the women concerned?
Madam Deputy Speaker (Natascha Engel)
Order. There is a lot of shouting out now. If the Minister wants to take an intervention, he will, but if we could stop shouting it would help us proceed with the debate.
Mr Vara
I will not give way, as I wish to make progress.
Following the 2011 Act, we wrote to all those directly affected to inform them of the change to their state pension age. About 5 million letters were sent by the DWP and the sending of the letters to those affected was completed between January 2012 and November 2013. Letters to those whose state pension age was set by the 1995 Act only were sent between April 2009, when Labour was still in government, and March 2011, when that process was finished by the coalition Government. As a result of those efforts, in 2012 a survey by the DWP found that only 6% of women who were within 10 years of receiving their pension thought that their state pension age was still 60.
The shadow Work and Pensions Secretary mentioned several surveys and was somewhat selective in those to which he referred. The one done by the DWP, which runs and is in charge of the pension scheme, has a fair amount of validity and, as I say, only 6% of women who were within 10 years of receiving their pension thought that their state pension age was still 60. As for the original 1995 changes to the state pension age, in 2004 nearly three quarters of those between 45 and 54 were aware of changes to women’s state pensions. Our communications campaign has focused on raising general awareness of the changes and encouraging those closest to the state pension age to get a personalised state pension statement.
Richard Graham (Gloucester) (Con)
I am grateful to the Minister for giving way and, despite the chuntering from those on the Labour Front Bench, I can assure him and everyone else that this is my question. We heard earlier from the shadow Secretary of State that he believed that the communication on this been absolutely appalling. He overlooked the fact that his own Government estimated that 75% of women had been informed. He also overlooked the fact that according to evidence to the Select Committee there were 600 mentions of the 1995 Act found in the media at that time. According to the briefing on the state pension legislation, 17 million automatic forecasts were issued by the Labour Government between 2004 and 2006—[Hon. Members: “Speech!”] Does my hon. Friend agree that although undoubtedly some women were not informed, many were?
Mr Vara
I am grateful to my hon. Friend for putting those facts on the record. I am, however, sorry that as he was making those points of substance, all he got was the yah-boo politics that we can expect from the Opposition. I am afraid that the truth, as anyone watching this debate at home can see for themselves, is that the Opposition do not want to know the substance or the facts. All they are interested in is the politics, but this is far too important an issue to be treated with the political naivety with which some Opposition Members are treating it. This is an important subject and the Government are dealing with it and treating it with the seriousness it deserves.
Catherine McKinnell
I thank the Minister for giving way, and he is clearly in a difficult corner, but I wondered whether he could clarify whether the Government now accept that women—well, anybody—need at least 10 years’ notification of a pension change in order to plan and prepare. If the Government now accept that, will he explain why that does not apply to this group of women?
Mr Vara
The hon. Lady will be aware that Governments have to take difficult decisions at times. Considering the state of the economy and the financial position that this Government came into—she will be aware that one of her own colleagues said that there was no money left—and considering the longevity of both men and women, the Government had to take difficult decisions, as all Governments of both shades have to. This Government had to take difficult decisions and we took them because they needed to be taken.
Tommy Sheppard (Edinburgh East) (SNP)
The women of this country will be watching this debate and listening to the Minister’s comments with a mixture of concern and disappointment. He is giving us history lessons and is trying to apportion blame. We have a material problem now that the Government need to address, so he should stop looking backwards and start looking forwards, and start caring for the women of this country. This House has already said by an overwhelming majority that it wants the Government to look again at the transitional arrangements: has the Minister looked again at them, has his position changed since the last time this House debated the subject and will he tell us what his change of position is?
Mr Vara
If hon. Members did not give mini speeches in the middle of my speech, I could reach my conclusions. I will answer the hon. Gentleman’s question in due course. We cannot look at the changes to women’s state pension age in isolation without acknowledging the significant changes in life expectancy in recent years, the huge progress made in opening up employment opportunities for women and the wider package of reforms. First, on life expectancy, the reason for all these significant reforms is that people are not just living longer but are staying healthy for longer. In just a decade, the length of time for which 65-year-olds will live in good health has surged by more than a year. That is welcome news, but it puts increasing pressure on the state pension scheme, and the Government—any Government—have a duty to ensure the sustainability of the state pension system. It would have been irresponsible for this Government, or the then coalition Government, to have ignored those developments.
Nic Dakin (Scunthorpe) (Lab)
Does the Minister agree that all Governments have the responsibility to be fair to the people of this country? Women are affected by the goal posts moving, and the benefits that they would get at retirement age have gone as well. This is a double whammy for that group of women who have worked hard all their lives.
Mr Vara
The Government have a duty to all their citizens, and they have to take difficult decisions and perform a balancing act. It is important to bear that in mind when people are talking about spending £30 billion-plus, or £77 billion. Those are serious sums of money, and difficult decisions have to be taken to achieve that balancing act.
Several hon. Members rose—
Mr Vara
I will make progress. The landscape for women and employment has completely changed since the 1940s. Female employment is now at record levels, with more than 14 million women in work—a record rate of nearly 70%. The number of older women aged 50 to 64 in work is also at a record high, with over 100,000 more older women in work than this time last year. Indeed, over the past decade, women have on average stopped working later than 60. In 2015, the average age was 63, and we know that more women than men would prefer to work flexibly or part-time before retiring.
Mr Kevan Jones
My hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) just said to the Minister that we need at least 10 years for these notifications to be brought in. Is he confirming that this group of women, some of the poorest people in the country, are paying for the planned deficit reduction? What does he say to my constituent, Jayne Manners, who is disabled and cannot make up the six years that she has lost from this scheme? What transitional help can he give her?
Mr Vara
The hon. Gentleman in part repeated a question that was asked earlier, and I refer him to my previous answer. I will turn to other issues later, given the opportunity to make progress with my speech.
We need a pensions system that recognises the changes that have been made, in the same way that we have responded to the need to support older workers in the labour market. We have abolished the default retirement age and extended the right to request flexible working to all employees, and we are working with businesses to encourage the employment and retention of older workers.
Peter Dowd (Bootle) (Lab)
On transitional funding, is it about time that the Government started tackling rich corporate tax dodgers and stopped dodging poor women pensioners?
Mr Vara
I am sure the hon. Gentleman is delighted that he was able to score his cheap political point.
Let me turn to our wider reforms. We inherited one of the most complex state pension systems in the world, and too many people did not understand what they could expect upon retiring. From April this year, we are introducing a simpler state pension that will give people a clear picture of what the state will provide so that they can build their own savings. We have a triple lock, so that pensioners will see their basic state pension go up by at least 2.5% every year, as it has since 2011. That means that from this April, pensioners will receive a basic state pension that is more than £1,100 higher a year than at the start of the last Parliament. It is important for people to look at matters in a broader context, rather than in the single-issue context that many colleagues seem to be speaking about.
Lady Hermon
I am genuinely grateful to the Minister for at long last allowing me to intervene. In response to an earlier intervention by a Conservative Member who has now left the Chamber, the Minister replied that Ministers are always happy to meet party colleagues to discuss difficult cases. Unlike the Minister for Pensions, who sits in the other place, this Minister has refused to come to Northern Ireland and meet women who were born in the 1950s and who are adversely affected by this change. Will he please have the good grace to agree to come to Northern Ireland and meet my constituents in North Down, and other women affected by this issue, and explain why the Government will not introduce transitional measures?
Madam Deputy Speaker (Natascha Engel)
Order. Before the Minister replies, 25 Members wish to catch my eye and we are hoping to have a Division at about 4:50 pm. We still have another Front-Bench opening speech, and we are getting tight on time. Interventions have been very long, but if the Minister could start concluding his remarks, we might be able to get everybody in.
Mr Vara
I take on board what you say, Madam Deputy Speaker, and I am coming to a conclusion. I am more than happy to meet colleagues, but I am afraid the venue would have to be negotiated. It is not every day that I go to Northern Ireland, but if the hon. Lady wants a meeting with me I am more than happy to meet her here in London.
We have ensured that more people are saving for their retirement by requiring employers to enrol their staff on to a pension with our auto-enrolment scheme. In addition to those reforms, we have continued to protect and build on a range of other pensioner benefits, including a permanent increase to cold weather payments, protection of winter fuel payments, and protection of free bus passes.
Mr Vara
I will not give way. Hopefully the hon. Lady heard what Madam Deputy Speaker directed.
We are providing greater security and choice for people in retirement, while also ensuring that the system is sustainable for the future. That is a record on pensions and pensioners of which Conservative Members can be proud. Parliament has extensively debated accelerating the changes to the state pension age. We listened to all arguments for and against at the time of the Pensions Act 2011, and we made transitional arrangements.
We are far behind other countries in Europe on equalisation—Germany, Denmark, the Czech Republic and Greece have already equalised the pension age for men and women. We must look to the future, not persist in looking backwards. These changes are about putting our pensions system on a secure financial footing, rather than continuous confusion for those affected and further debate. We should build on the high levels of awareness that we already have, and continue to promote flexibility, choice and security for older people. There are no plans on the part of the Government to make policy changes.
Several hon. Members rose—
HM Courts and Tribunals Service
Shailesh Vara Excerpts(8 years, 7 months ago)
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The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
On 19 February the Secretary of State for Justice and Lord Chancellor wrote to the Chair of the Justice Select Committee to inform him of two issues concerning Her Majesty’s Courts and Tribunals Service (‘HMCTS’): one relating to Form E1 and the other relating to community penalty breach warrant processing errors.
As a result of further extensive investigations to establish the cause of the Form E error, my officials have alerted me to a further calculator problem in a past version of another form, Form E1.
Form E1 is the form that parties must use to disclose financial information in certain kinds of financial proceedings, including proceedings for financial provision for children that fall outside the statutory maintenance scheme. Form E1 is used in a much smaller number of proceedings than Form E.
This fault meant that the automatic calculator in the form calculated the wrong total for an individual’s net assets by failing to deduct certain liabilities.
The investigation found the faulty formula was present in the version of Form E1 that was available on the HMCTS Form Finder website between April 2011 and March 2012.
HMCTS has conducted a search on a set of 459 cases that have a record of a financial application or a reference to Form E1 having been filed during this period. Where Form E1s were found, they were checked to see if they were the HMCTS version containing the calculator error, and if so whether the error was present. Three Form E1s have been identified as containing the calculation error.
While we are confident that the trawl has captured the vast majority of cases that could have been affected by the error, anyone concerned about their case can write to us and their case will be checked. Following the Form E error coming to light, HMCTS established a dedicated email address which people could use if they were concerned about their own case: formE@hmcts. gsi.gov.uk. Those who wish to contact us about Form E1 should use this same email address.
Although the faulty form was used in these cases, it will not necessarily have had any effect on the ultimate outcome. Form E1 is only a part of the material used by the parties and the court and is used at an early stage, so the information is often disputed or superseded by further information introduced during proceedings.
We have instructed HMCTS to write to all parties in the three cases identified. The letter will express our sincere regret, set out what happened and explain that, although Form E1 is just one part of the evidence used in their case, there remains a possibility that the error affected the final outcome.
The letter will set out options available to people involved in these cases. They may wish to do nothing, if, for example, they know that the error was corrected during the proceedings or they do not wish to re-open their cases. If they think they have been affected by this error then they can apply to the court to vary or set aside their order. My officials consulted the president of the Family Division about the court rules and procedures that would apply to such applications or for any other proceedings that might be open to the parties. My officials are also consulting the president on the development of a specific form for such applications. We will provide a link to the new form in our letter to the parties, as well as guidance on how to complete the form.
We have instructed that no court fee will be charged for making this application, and this will also be made clear in the letter from HMCTS.
The current version of Form E1 has the correct calculator functionality and we will also consider the future of Form E1 as part of our broader court reforms.
With regard to community penalty breach warrants, on Tuesday 26 January, I was alerted to an error in the processing of an individual breach warrant by HMCTS.
A community penalty breach warrant is issued when an individual has failed to attend court to answer why they have not complied with the conditions of, for example, a community or suspended sentence. In some circumstances, individuals may be remanded in custody following a breach of their order.
The effect of a breach warrant not being processed properly can be that notification that a warrant has been issued to arrest an individual is either sent late to the arresting authority or not sent at all.
Following this individual case, HMCTS immediately began an urgent investigation into whether this was an isolated incident or more widespread. Initial local checks into all 725 ‘live’ breach warrants in the Greater Manchester area discovered that a further 51 breach warrants had been processed incorrectly. Those errors were due to processes being disapplied or ignored by specific members of HMCTS staff in the Greater Manchester area. Immediate steps have been taken to ensure that proper procedures are now being followed in Greater Manchester and action has been taken against all members of staff identified as responsible for these errors. All of the 52 warrants have since been processed correctly and have either been actioned or are in the process of being actioned by the enforcing authority.
Given the potentially serious repercussions of breach warrants not being properly processed, HMCTS then instigated detailed and thorough investigations across the whole of England and Wales to see if the problems in Greater Manchester had also occurred elsewhere. A total of 4,054 live warrants (including those in Greater Manchester) have been checked in 200 issuing courts across the country—including every warrant issued over the last month. Those checks have identified a further 69 errors nationally, including 47 in the London region.
Investigations are now examining the reasons for error in all 69 cases outside of Greater Manchester, and are particularly focused on why a disproportionate number appear to have occurred in London.
Early findings have already made clear that the majority of the errors in London were due to a change in process and personnel that had been addressed by the end of January 2016.
Immediate detailed assurance is being carried out of local processes to ensure that all community penalty breach warrants are sent to the appropriate enforcement authority, and an in-depth audit is being carried out in London and Greater Manchester to assure their processes independently. The relevant standard operating procedures are being strengthened as a matter of urgency, and best practice that has been identified through the investigations undertaken will be shared and implemented across the country. Appropriate action will be taken in respect of all staff members who have made errors, consistent with the approach taken in Greater Manchester.
HMCTS will report to me as soon as possible on the reasons for each individual error across the country and will also recommend whether more action should be taken to the steps outlined above in order to eliminate the possibility of further errors occurring in future. These mistakes are deeply regrettably and I sincerely apologise to anyone who may have been affected.
[HCWS540]
Grants of Probate
Shailesh Vara Excerpts(8 years, 7 months ago)
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The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
On 18 February, the Government published a consultation paper proposing new fees for applications for grants of probate.
In the spending review the Ministry of Justice was allocated £700 million investment in Her Majesty’s Court and Tribunal Service (‘HMCTS’). This will transform our courts and tribunals, reducing complexity in language, processes and systems; helping people reach the best resolution for them; minimising the steps that people need to go through to obtain justice; and improving access to justice. We will invest in better facilities and use technology to reduce paperwork, so that we create a courts and tribunals service fit for the modern age.
At the same time, we must reduce the burden on the taxpayer of running our courts and tribunals. In meeting our spending review settlement, all parts of the Ministry of Justice must contribute to the national effort to reduce the deficit and restore the Government’s finances to surplus. The courts and tribunals service cost £1.8 billion in 2014/15, but only £700 million was received in income. This leaves a net cost to the taxpayer of around £1.1 billion in one year alone.
Our consultation on probate applications sets out reforms designed to increase income for a more sustainable courts and tribunals service and to introduce a more progressive fees regime. Probate applications are currently charged a fee of £155 if made by a solicitor and £215 if paid by an individual (“personal applications”). These fees apply to estates worth £5,000 or more. We propose raising this threshold from £5,000 to £50,000, lifting 30,000 estates out of the need to pay a probate fee altogether. The proportion of estates paying no fee would rise to 57%.
Above that threshold, we propose that the probate fee increases in line with the value of the estate. Estates worth over £50,000 but below £300,000 would see their fee rise to £300, a modest increase of £85 on the current maximum fee of £215. 84% of estates would pay £300 or nothing and 94% of estates would pay £1000 or less. The maximum fee of £20,000 would only be paid by the very wealthiest estates, worth more than £2 million. The fee would never exceed 1% of the value of the estate and in many cases it would be considerably less.
We also want to see a simpler, more streamlined process for probate applications, moving from a paper-based to an online system. This will make the probate service much easier to navigate so the experience of the bereaved is as simple and hassle-free as possible, reducing worry for executors at what is often a very difficult and distressing time, and enabling most applications to be completed online and, we hope, without expensive professional advice.
These proposals are progressive, with lower value estates lifted out of paying any fee at all and other estates only paying more as the value of the estate increases. They are also necessary, making a significant contribution to reducing the deficit and enabling investment which will transform the courts and tribunals service.
Court fees are never popular but they are necessary if we are, as a nation, to live within our means. These proposals would raise around an additional £250 million a year, which is a critical contribution to cutting the deficit and reducing the burden on the taxpayer of running the courts tribunals.
Full details of the Government’s proposals are set out in the consultation document which has published on the website at: www.gov.uk.
[HCWS541]
Her Majesty’s Courts and Tribunals Service
Shailesh Vara Excerpts(8 years, 7 months ago)
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The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
The Government are committed to modernising the way in which justice is accessed and delivered. We are investing over £700 million over the next four years to update the court and tribunal estate, installing modern IT systems and making the justice system more efficient and effective for modern users.
Working closely with the judiciary, we have begun installing wi-fi and digital systems in our criminal courts but much more needs to be done. We want to make the entire justice system more accessible to everyone—witnesses, victims, claimants, police and lawyers—by using modern technology including online plea, claims and evidence systems and video conferencing, reducing the need for people to travel to court.
As part of this modernisation, the court and tribunal estate has to be updated. Many of the current 460 court buildings are underused: last year 48% of all courts and tribunals were empty for at least half their available hearing time. These buildings are expensive to maintain yet unsuitable for modern technology.
Court closures are difficult decisions; local communities have strong allegiances to their local courts and I understand their concerns. But changes to the estate are vital if we are to modernise a system which everybody accepts is unwieldy, inefficient, slow, expensive to maintain and unduly bureaucratic.
On 16 July 2015 I therefore announced a consultation on proposals to close 91 courts and tribunals in England and Wales. Over 2,100 separate responses were received, along with 13 petitions containing over 10,000 signatures. I am grateful to all who took the time to provide their views. It is clear from the responses that the service our courts and tribunals provide continues to be highly valued.
Having considered carefully all responses to the consultation, we have decided to close 86 of the 91 courts and tribunals. A total of 64 sites will close as proposed in the consultation. A further 22 closures will take place but with changes to the original proposals. These changes, many suggested by respondents, include the identification of suitable alternative venues, such as local civic buildings; or different venues in the HMCTS estate to those originally proposed. I am very grateful to all those who engaged with the consultation to help us to reach the best solutions.
On average, the 86 courts we are closing are used for just over a third of their available hearing time. That is equivalent to less than two days a week. It will still be the case that after these closures, over 97% of citizens will be able to reach their required court within an hour by car. This represents a change of just 1 percentage points for both criminal and county courts. The proportion able to reach a tribunal within an hour by car will remain unchanged at 83%.
For each proposal in the consultation, we have considered access to justice; value for money; and efficiency. The consultation response, which is being published today, contains details of all the decisions and changes including an indicative timetable for closures, and will be placed in the Libraries of both Houses.
[HCWS536]
Social Security
Shailesh Vara Excerpts(8 years, 7 months ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
I beg to move,
That the draft Social Security Benefits Up-rating Order 2016, which was laid before this House on 25 January, be approved.
Madam Deputy Speaker (Natascha Engel)
With this we shall take the following motion:
That the draft State Pension (Amendment) Regulations 2016, which were laid before this House on 18 January, be approved.
Mr Vara
May I take this opportunity to welcome the hon. Member for Ashton-under-Lyne (Angela Rayner) to her new position? I look forward to discussing and debating various issues with her over the coming months. I thank her and the hon. Member for Banff and Buchan (Dr Whiteford) for their contributions. In the short time that we have, I will try to address as many of their questions as possible. I also thank the hon. Member for Denton and Reddish (Andrew Gwynne) for his one or two interventions. I am grateful to the hon. Member for Ashton-under-Lyne for welcoming the triple lock and to her party for its support for that initiative.
The issue of communication has come up repeatedly. I just want to say that there is an awareness campaign, which is particularly targeted at those aged 55 and above. They will receive a letter—their addresses will be obtained from payroll and benefits data—providing details of their own state pension. The first phase of our communications campaign aims to build awareness among those in that age group, who will be the first to reach pension age after April 2016, and we are encouraging them to get a personalised statement. Between September 2014 and October 2015, we issued nearly 500,000 personal statements. We have factsheets, infographics, videos, calculators, YouTube videos, toolkits for stakeholders and weekly stakeholder bulletins. We will continue to do whatever is necessary and whatever we can to ensure that people are made aware of what is coming. I urge all colleagues on both sides of the House to do their bit, as Members of Parliament with access to media and to local communities, to make sure that people are aware of this very important change.
It is our intention, and it will be the case, that the new state pension will be a lot simpler and clearer for people than the previous situation, when there were opt-outs in relation to the state earnings-related pension scheme and additional pensions, as well as private pensions, occupational pensions and so on. The hon. Member for Ashton-under-Lyne said that not everyone will qualify for the new rate of £155.65, and she is absolutely right, because the new state pension is based on people’s national insurance contributions. In recent years, some people have not paid full national insurance contributions to the state because they have opted out or contracted out. Some of those people contracted out into a second, additional pension, and that has to be factored in. Alternatively, the national insurance contributions that they had contracted out of were used for an occupational pension or a private pension. If the two pensions are added together, the total will in many cases be more than £155.65.
I hope that the hon. Lady and her colleagues appreciate that if we have a system in which people’s pensions are based on national insurance contributions, they cannot, if they have not paid such contributions, be expected to get the full payment due notwithstanding the fact that some of their national insurance contributions have gone to another pension. I hope she will reflect on that point.
Angela Rayner
I gave the Minister a specific example of someone who had not contracted out because of a second pension. Will he address that point and the fact that some people have not been given adequate notice of the changes? I appreciate the point he makes about contracted-out contributions, but some people have not been given such information. I am asking for people to be given that information so that they can make alternative provision.
Mr Vara
The hon. Lady will appreciate that I cannot give advice on individual cases at the Dispatch Box. As for communication, I have read out a whole list of measures we are putting in place to make sure that people are communicated with. If we were not doing our job properly, we would not have issued nearly 500,000 personal statements between September 2014 and October 2015. We continue to make sure that people are aware of the change. As I have said, she has a role to play, as do others. I am sorry that she expresses such disappointment, given that in the forthcoming year the Government will spend an additional £2.1 billion more than we are spending at present. There is also the pension credit standard minimum guarantee, which will ensure that the minimum threshold must be met. The state is there to assist people.
The hon. Member for Banff and Buchan mentioned frozen pensions. It has been the policy of successive Governments for the past 70 or so years not to uprate pensions for everyone. The issue is complex, but she will be aware that uprates are made in some countries where there is a legal obligation to do so. It should be remembered, however, that the pensions people get in some countries are based on a means test: if we gave everyone from Britain who is now resident in another country an uprate, our contribution to that uprated pension would be taken into account by their new home country and they would therefore be given less by the new home country.
Mr Vara
The hon. Gentleman is shaking his head, but I assure him that some countries make pension payments on the basis of means.
This Government take the rights of pensioners very seriously, and we are doing all we can to protect them. From April, the rate of the basic state pension for a single person will go up by the biggest real terms increase since 2001. We will continue to protect the poorest pensioners. The means-tested threshold below which pensioner income need not fall—the pension credit standard minimum guarantee—will also have the biggest real terms increase since its introduction. The full basic state pension will be more than £1,100 per year higher in 2016-17 than at the start of the last Parliament. Our triple lock, our protections for the poorest pensioners and our new state pension reforms mean that we can provide pensioners with the dignity and security that they deserve in retirement. I commend the order and the regulations to the House.
Question put and agreed to.
Social Security
Resolved,
That the draft State Pension (Amendment) Regulations 2016, which were laid before this House on 18 January, be approved.—(Mr Vara.)
Caerphilly County Borough Council
Shailesh Vara Excerpts(8 years, 8 months ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
It is a great pleasure to serve under your chairmanship, Ms Vaz. I congratulate the hon. Member for Caerphilly (Wayne David) on securing this debate. He is diligent and conscientious in all that he does for his constituents, so it is no surprise that he brought this important matter to the House of Commons to get a proper answer for his constituents. I am grateful for the opportunity to respond to this debate. I understand the concerns of the people of Caerphilly about the cost of the case, but I hope the hon. Gentleman will appreciate that the justice system’s obligation to investigate cases, even when they involve high-profile individuals, and the duty on judges to make decisions according to the information before them must continue.
I have spoken previously about the Government’s commitment to a one-nation justice system, and a fundamental part of that is the rule of law. Those responsible for investigating allegations of misconduct must be able to do so robustly and without intrusion, and it is crucial that those who make decisions in the system are independent and protected from undue state influence. It is not for this place to challenge the Wales Audit Office’s investigation, the independent prosecutorial decision to bring the proceedings or the judicial decision to bring the proceedings to a close. If it is felt that the investigation or prosecution was lacking, the right place to seek redress is with the Auditor General for Wales or the Director of Public Prosecutions. Those who feel that the case should not have ended in the way it did could have requested that the judge’s decision be scrutinised by the higher courts by bringing an appropriate challenge within the timescales prescribed in law.
I listened carefully to what the hon. Gentleman said—particularly about the long time it took to arrive at a conclusion. He is, of course, aware that several factors influenced that timescale—indeed, he alluded to some of them—including the defence’s challenge of the police review of unused material, and judicial and defence counsel availability. Notwithstanding those factors, the case was concluded well within the average time for such complex cases. Cases of that nature take, on average, 25 months from charge to conclusion. That case was dealt with more quickly than the average for complex financial cases. The hon. Gentleman also mentioned listing, which is a judicial decision. Bristol Crown court sees a high number of fast-tracked sex cases, so it takes longer than usual for it to see other types of case.
The Government are undertaking a substantial programme of reform to improve the criminal justice system for those directly involved in it and the general public. In January 2015, Sir Brian Leveson published a review on efficiency in criminal proceedings, which included 56 recommendations for improving efficiency in the criminal courts within the existing legislative framework. His recommendations are the result of considerable consultation across the criminal justice system, and they cover a range of areas, including improving case management and progress in magistrates and Crown courts.
In his review, Sir Brian emphasised the need for more robust case management, and noted the importance of getting it right the first time. He recommended that one person in the police, in the Crown Prosecution Service and for the defence must be responsible for the conduct of each case. That recommendation is being taken forward as part of a better case management initiative, and will be rolled out nationally from the beginning of January following its successful introduction in eight Crown court centres in October 2015.
The initiative emphasises the importance of effectively managing proceedings while preserving judicial discretion. It aims to deal more quickly with cases where there is a guilty plea, which will free up capacity to manage more actively cases that go to trial. It aims to ensure better communication between practitioners and the court before the first hearing; more effective hearings; more guilty pleas; the disposal of many cases without the need for adjournment; and robust judicial resistance to applications to adjourn.
According to the Leveson review, to improve case management it is crucial to encourage early engagement between the prosecution and the defence. Sir Brian recommended that the criminal procedure rules make it clear that the parties are under a duty to engage at the first available opportunity. In response to that recommendation, we made amendments to the criminal procedure rules, and we are due to make more in April. Earlier engagement between parties will ensure greater collaborative working. It will allow parties to focus on the key issues, possible pleas, missing evidence and other material that could help them reach an early resolution.
Wayne David
I appreciate the Minister’s point and I welcome the reforms that he says are in the pipeline, but I refer him back to the costs incurred by Caerphilly County Borough Council through no fault of its own. With the benefit of hindsight, would it not have been better for case to have been heard somewhere other than Bristol Crown court if the pressures of work on it were so great? If the case had been held elsewhere, it could have been expedited, and matters could have been dealt with much quicker.
Mr Vara
I am grateful to the hon. Gentleman for raising that issue. He will appreciate that it is for the judge to determine who pays the cost of the trial. The judicial process must be based on the legal advice that the council can take. The hon. Gentleman will appreciate that the cost of employing additional staff to manage the work while a long case is going on is a matter for the council.
On transferring the case to somewhere other than Bristol, I hope that our reforms will enable a broader perspective to be taken on board and allow people to say, “Although this is a local issue, in order to secure justice for the people involved and for justice to be seen to be done quickly, would it be better for it to be dealt with in another nearby court where there is more capacity?” I hope that our reforms will ensure that cases are dealt with quickly and promptly. If there is a delay in one court, we should certainly look at neighbouring courts that have capacity; I do not rule that out. The hon. Gentleman will appreciate that the Ministry of Justice is putting in place ambitious plans. I am confident that they will be in effect in due course, but I am sorry that they could not benefit his constituents at the time of the case that he refers to.
Improving awareness of the criminal procedure rules will also allow more robust case management. The Judicial Office has been working with the judiciary and defence practitioners to raise awareness of and embed the criminal procedure rules. Discussions have been taking place with the Bar Council, the Law Society, the Judicial College and the criminal procedure rules committee. Compliance with the criminal procedure rules will ensure that court time is deployed to maximum effectiveness and efficiency.
Sir Brian also recommended using technology to improve case management. Case management hearings have become inefficient and expensive. They are essentially administrative in nature and do not always require all participants to be gathered in the same room. He therefore encourages the use of video and audio technology to hold case management hearings outside court, reducing the time spent on unnecessary travel and making case management hearings more effective. Pilot hearings have been implemented in Reading Crown court and are soon to be expanded to Aylesbury and Oxford. Those hearings will be evaluated after a couple of months and should then inform national implementation.
I hope that the hon. Gentleman can feel assured that this Government, together with the judiciary, are taking active and practical steps to improve the efficiency of the criminal justice system. In saying that, I do not intend to imply any criticism of the handling of this particular case, as it is not the role of a member of the Government to comment on the outcome of this or any other case. As we improve the system in the coming years, nothing will be done to fetter or interfere with due process, which must be independent of Government and managed by an independent judiciary. I thank the hon. Gentleman again for raising this important issue on behalf of his constituents.
Question put and agreed to.
Transitional State Pension Arrangements for Women
Shailesh Vara Excerpts(8 years, 8 months ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
It is a pleasure to serve under your chairmanship, Mr Hanson.
I start by thanking the hon. Member for Warrington North (Helen Jones) for moving the motion today, and for doing so very passionately, convincingly and articulately. I also thank all other Members from across the political divide who have spoken today. Indeed, I commend all those who signed the petition that triggered this debate. As we have already heard, we have debated this issue extensively in recent weeks and months, and I am grateful to have another opportunity to put the Government’s position on record.
The debate has centred considerably on state pension age equalisation, and in particular its impact on the women who are affected by it. However, it is important that we do not look at this topic in isolation. We cannot look at the changes to women’s state pension age without also acknowledging the significant changes in life expectancy in recent years, the huge progress made in opening up employment opportunities for women and the wider package of reforms—
Mr Vara
I will not give way; I wish to make progress.
As I was saying, we must also acknowledge the wider package of reforms that we have introduced to ensure a fair deal for pensioners.
On life expectancy, people now live longer and stay healthier for longer. I took on board what the hon. Member for Worsley and Eccles South (Barbara Keeley) said, but although she may have quoted a specific figure, other figures show that life expectancy is projected to increase for both men and women. In just a decade, the length of time that 65-year-olds—
Caroline Flint
The Minister is wasting time when he could have taken an intervention.
Mr Vara
In only a decade, the time that 65-year-olds live in good health has gone up by just over a year. Of course, this is welcome news, but the reality is that it puts increasing pressure on the state pension scheme. Even when the state pension age changes are taken into account, women in this group will on average receive a higher state pension over their lifetime than any generation before them.
Mr Vara
I will not give way.
The Government have a duty to ensure the sustainability of the state pension scheme, and it would be irresponsible to ignore such developments.
Employment prospects for women have changed dramatically since the state pension age was first set in 1940. The most recent figures show a record female employment rate of 69.1%, with more than 1 million more women in work than in 2010. I am sure that Members welcome figures showing that the number of women aged between 50 and 64 in work is also at a record high, with more than 100,000 older women in work than at this time last year.
Mr Vara
I will not.
Turning to our broader reforms, we have introduced a package of measures to transform the pensions system. The triple lock is massively boosting the state pension, which will be £1,000 higher from April than would have been the case if we had uprated by earnings over the past six years. In addition, we have protected the winter fuel payment and permanently increased cold weather payments. We have created a new, simpler state pension, which will come in from April with a full rate of £155.65 a week. That means that 650,000 women will receive an average increase of £8 a week for the first 10 years. As that will be set above the basic means test for pensioners, people will have a clear platform to save on.
Ian Blackford
On a point of order, Mr Hanson. May I ask for your guidance about what can be done? This is a specific debate about the WASPI campaign, but the points that the Minister is addressing have nothing to do with that debate—
Mr David Hanson (in the Chair)
Order. With due respect to the hon. Gentleman, the content of the Minister’s speech is for the Minister to elucidate and defend accordingly. It is not for the hon. Gentleman to comment on in a point of order.
Mr Vara
We have also abolished the default retirement age so that people can work for as long as they wish without fear of age discrimination. We have introduced the most fundamental reform to how people can access their pension in almost a century through pension freedom, which has abolished the effective requirement to buy an annuity.
No one can say that the changes have not been fully considered. The parliamentary process was fully followed. We held a full, public call for evidence alongside extensive debate in both Houses. Between January 2012 and November 2013, the Department for Work and Pensions wrote to all those affected.
Mr Vara
I will not.
More than 5 million letters were sent to addresses then recorded by HMRC. Crucially, the Government also listened during the process. On Second Reading of the Pensions Bill in 2011, the Government said:
“we will consider transitional arrangements.”—[Official Report, 20 June 2011; Vol. 530, c. 52.]
On Report, after considering the matter, Ministers made a concession worth £1.1 billion, and the time period was reduced from two years to 18 months. For 81% of those affected, the increase in the time period will be no more than 12 months.
To reverse the Pensions Act 2011 would cost more than £30 billion, which simply is not sustainable, and nor is it sustainable to reverse the 1995 changes, which some wish to do, as that would cost many billions more. It is noteworthy that if we went back to the 1995 position, it would mean that women would be campaigning for a state pension age of 60—[Interruption.]
Helen Jones
Very well then. The Minister cites average ages, but that does not address the issue. The issue is the extra time that women have to wait for their pension and the fact that they have not been informed. The average means nothing to that.
Mr Vara
If the hon. Lady will stop interrupting, I will get on.
I mentioned in the House earlier and I say it again now that when people need extra funds, other benefits are available. That is the case for those who are in work and those who are not. A 2004 Department for Work and Pensions report entitled “Public Awareness of State Pension Age Equalisation” found that 73% of those aged between 45 and 54 were aware of changes to women’s state pension. In 2012, further research by the DWP found that only 6% of women who were within 10 years of receiving their pension thought that their state pension age was still 60.
Several hon. Members have mentioned Steve Webb’s comments. If one reads the full transcript, one sees that he referred to £30 billion. He said that he sought a concession of £3 billion, but got £1 billion. He added that
“a billion quid is a serious amount of money”.
Reference has been made to other European countries. To put the balance right, I point out that there are countries that have already accelerated the process and equalised the pension age for men and women, such as Germany, Denmark, the Czech Republic and Greece.
The Government recognise the huge contribution that older workers make to the workforce and the country, and we are working with stakeholders to ensure that they recognise those benefits. The number of women aged 50 to 64 is at a record high, as I mentioned earlier. Hon. Members talked about carers. Under the new state pension, people who care for others will qualify for credits that will go towards their contributions to that pension.
Our collective responsibility now is to support the package of reforms. Rather than causing continuous confusion for those affected, we need to build further awareness of the measures I have set out. I again thank all those who have contributed.