State Pension Age

Debate between Tom Blenkinsop and Iain Duncan Smith

Wednesday 2nd March 2016 Commons Chamber

[Mr Duncan Smith]

I must say that I was slightly surprised earlier today when I saw the Opposition spokesman tweeting the most inflammatory comments about people retiring. I can understand that those in opposition need to try to get attention, but to start worrying and scaring people without foundation or reality is nothing short of appalling. I wish the hon. Gentleman would get up and apologise for that.

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

The review will consider variations in pension arrangements between “different groups”. Will the Secretary of State give more detail on whether “different groups” refers to occupations, such as shift workers or, to give an example from my constituency, bus drivers, who get chronic bladder conditions? The life expectancy and health of those groups deteriorates as a result of their occupation. Will those issues be raised in the review?

[Mr Duncan Smith]

It is certainly within scope for that matter to be raised with the reviewer. He and his team have the power to review it. I recommend that the hon. Gentleman raises that concern. It is up to the reviewer to what degree he looks at it.

Pensions Bill [Lords]

Debate between Tom Blenkinsop and Iain Duncan Smith

Monday 20th June 2011 Commons Chamber

[Mr Duncan Smith]

May I just finish my answer to the right hon. Gentleman?

I am always happy to discuss the matter. There are complications, and there may be some issues about women, too, because contributions are an issue for many women at the moment, so we cannot take these things lightly. I recognise the work that the right hon. Gentleman has done, however, and I am very happy to discuss the issue beyond this Bill, as is the Minister of State, Department for Work and Pensions, my hon. Friend the Member for Thornbury and Yate (Steve Webb). For the purposes of the Bill, however, the right hon. Gentleman will forgive me if I stay to the point that we are going to equalise the retirement ages for men and women. The only question is, at what point?

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

rose—

[Mr Duncan Smith]

I am going to make some progress, but I give way to the hon. Member for St Helens North (Mr Watts).

[Mr Duncan Smith]

As I understand it, the pre-1975 data are very patchy and messy. I do not want to get sucked into this debate now, tempting as it is, and never to get on to the rest of the Bill; I do not think the hon. Gentleman’s colleagues would thank me for that. I recognise the issue and I am happy to discuss it post the Bill, but he will forgive me if I do not go down the road that Labour Members want by adding that in all of a sudden. I am not going to do that; we are going to stay with what we have. I am happy to listen to their concerns and to see whether we can make changes in future, but I do not give any guarantees.

[Tom Blenkinsop]

rose—

[Mr Duncan Smith]

To be fair, I want to make a bit of progress, because a lot of people want to speak. If the hon. Gentleman wants to raise something else about the matter, I will give way to him later.

Pensions policy has not been updated accurately to reflect all the increases that I spoke about. I remind the House, however, that we are by no means alone in having to deal with this issue; others are making decisions about it. Ireland has already legislated for the pension age to be raised to 66 by 2014, and the Netherlands and Australia are increasing state pension age to 66 by 2020. The United States is already in that position, and Iceland and Norway are now at 67. Under existing legislation, the timetable for the increase to 66 in the UK was not due to be completed for another 15 years, yet the timetable was based on assumptions that are now out of date. The Pensions Act 2007 was based on ONS projections of average life expectancy from 2004. Those projections have subsequently increased by at least a year and a half for men and for women, so the situation is moving apace. That is why we are taking the necessary decision to look again at the timetable for increasing the state pension age. The Bill amends the current state pension age timetable to equalise men’s and women’s state pension ages at 65 in 2018 and then progressively to increase the state pension age to 66 by 2020. This new timetable will reduce pressures on public finances by about £30 billion between 2016-17 and 2025-26.

The impact of the changes on women has been debated enormously, focusing particularly on certain cohorts. All but 12% of those affected will see their state pension age increase by 18 months or less. I recognise that some 1% of those impacted will have a state pension age increase of two years, but it none the less remains the case that those reaching state pension age in 2020 will spend the same amount of time in retirement as expected when the 2007 Act timetable was being drawn up. That is an important factor. There will be no change to the amount of time that they will spend in retirement—some 24 years, on average. In fact, the women who are affected by the maximum increase will still, on average, receive their state pension for two and a half years longer than a man reaching state pension age in the same year.

--- Later in debate ---

[Tom Blenkinsop]

rose—

[Mr Duncan Smith]

Hon. Members will forgive me if I make some progress. I gave way to the hon. Member for West Bromwich East (Mr Watson) earlier, and, although I did not give way to the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop), others want to speak, and I must conclude.

All the changes should be put in the context of our recent Green Paper, which set out plans for fundamental reform of the state pension. They include the option for a single-tier state pension, set above the level of the means test, which would provide a decent foundation income in retirement for many of the next generation, who might otherwise be forced to live in poverty. Importantly, that includes many women and self-employed people who have tended to suffer poorer pension outcomes in the past, particularly women with caring responsibilities. The changes will be very beneficial for them. The Bill is therefore only part of the process, but it is critical as we take the necessary steps for the next generation. I believe that those are responsible choices for Britain, but responsible government is not always easy government. It involves commitment, tough decisions and a willingness to stay the course. We will not change from that—we will stay the course. We must try to secure our children’s future. The tough decisions are enshrined in the Bill, which I commend to the House.