Oral Answers to Questions

Debate between Steve Webb and Baroness McIntosh of Pickering

Monday 1st September 2014 Commons Chamber

[Steve Webb]

The hon. Gentleman raises an important point. A review of legacy pension schemes is under way, under the auspices of the Association of British Insurers, and the issue of excessive exit fees is part of it. In most cases, the terms of schemes will allow people to access their budget flexibilities, but there may be some where the contract and scheme rules impose a charge, and that is a contract that people have entered into.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

Locally, auto-enrolment seems to be working smoothly for those on monthly salaries, but it is incredibly difficult for those on weekly wages. Are the Government familiar with that? Is the Minister able to assist in that regard?

Oral Answers to Questions

Debate between Steve Webb and Baroness McIntosh of Pickering

Monday 28th January 2013 Commons Chamber

[Steve Webb]

Thank you Mr Speaker. It will be a house- hold name soon, I hope.

We worked very closely with the OFT in the run-up to its inquiry, which will look at whether there are problems in this area. It is very welcome, and we will be working very closely with the OFT as it carries it out. As the hon. Gentleman knows, Labour introduced constraints on NEST—the National Employment Savings Trust—and we are consulting on whether to lift them.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

11. When my hon. Friend presented these proposals last week, it was indicated that there would be a net cost to public sector workers in relation to the higher-rate state pension. Is he able to put a figure on that additional cost?

[Steve Webb]

Yes. Those who work in the public sector will pay the full rate of national insurance, which is an extra 1.4%, but they will build up state pension at the full rate. Crudely speaking, they will pay about a tenth extra in national insurance but build up, potentially, up to a third extra in state pension, which will be a very good deal.

State Pension Reform

Debate between Steve Webb and Baroness McIntosh of Pickering

Monday 14th January 2013 Commons Chamber

[Steve Webb]

We are publishing later this week, along with the Bill, a detailed impact assessment of the changes over a series of decades. In the White Paper we have published today, the hon. Gentleman will see a chart that shows that, for I think at least 35 to 40 years, a majority of people affected by the changes will gain rather than lose.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

I congratulate my hon. Friend on what the Government have achieved and seek clarification on two points. From which budget will the NHS and other public sector employers have to find the additional national insurance contributions? Are small employers in constituencies such as Thirsk and Malton being asked to increase national insurance contributions as well as contribute towards a private pension scheme?

[Steve Webb]

In answer to my hon. Friend’s first question, the NHS as an employer already pays the reduced rate of national insurance from its own resources; it will have an increased rate of national insurance. Obviously the Exchequer will have an increased revenue. It will be a matter for the Chancellor of the day to decide what to do with that increased revenue, but the NHS as an employer will pay more national insurance—that is a fact.

In answer to my hon. Friend’s question about small firms in her constituency, very few small firms run contracted-out defined-benefit pensions, so the only people paying increased national insurance will be those who are contracted out who run these special final salary schemes. We have allowed those schemes to adjust their rules to offset the cost if that is how they choose to proceed, but most small firms will not be affected.

Oral Answers to Questions

Debate between Steve Webb and Baroness McIntosh of Pickering

Monday 18th July 2011 Commons Chamber

[Steve Webb]

Clearly, there is a balance to be struck between catching up with the very dramatic improvements in life expectancy, which are moving ahead faster and faster, and recognising the need for fairness and notice. We are trying to strike that balance. We recognise that we need to refine the Bill’s proposals to do so, and we will come back with proposals.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

May I thank the Minister for his answer in that regard? Will he give some reassurance to those in Thirsk, Malton and Filey who have written to me? Successive Governments, and the Turner report, have said that it takes some 10 years to plan for retirement. Will that be reflected and recognised in the Government’s transition proposals?

[Steve Webb]

As my hon. Friend will be aware, if we were to delay the whole transition for 10 years we would need to find an extra £10 billion of savings out of the £30 billion in the Pensions Bill. We believe that many of the people who are affected by the transition are affected by a lot less than the two years that the hon. Member for Livingston (Graeme Morrice) mentioned. We are therefore trying to tackle those who are most adversely affected, and I am confident that we will be able to do so.

Oral Answers to Questions

Debate between Steve Webb and Baroness McIntosh of Pickering

Monday 19th July 2010 Commons Chamber

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

10. What public consultation will be held on proposed changes to the retirement age for state pensions; and if he will make a statement.

[The Minister of State, Department for Work and Pensions (Steve Webb)]

On 24 June we published a call for evidence for plans to increase the state pension age to 66 on a more rapid time scale. The closing date for that consultation is 6 August.

[Miss McIntosh]

There is a general understanding of the need for such a change, but those who will be affected by what will be an arbitrary date desperately need the knowledge to enable them to plan their finances, to give them certainty and security in their retirement.

[Steve Webb]

My hon. Friend makes an important point, and we are seeking to move as quickly as possible to reach a conclusion on the change to the age of 66, to give people the maximum notice so that they can make appropriate plans.