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Women's Pensions

Volume 408: debated on Thursday 3 July 2003

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What recent discussions she has had with (a) the Treasury and (b) the Department for Work and Pensions on women's pensions. [123240]

The Department is in regular contact, at both ministerial and official level, with colleagues in the Treasury and the Department for Work and Pensions about women's pensions. I welcome the commitment of the Department for Work and Pensions to consider this issue further in the light of the responses it received to its pensions Green Paper.

Given that pensioner poverty is highest among women, with almost three quarters of pensioners on income support being female, what action will the right hon. Lady take with other Departments to ensure that that does not get worse? Some 1.5 million women in their 40s and 50s are about to receive derisory pensions as low as 7p per week because they followed the Government's advice and paid the lower national insurance rate for married women.

The hon. Gentleman makes a valid point about the poverty of many women in retirement. We, of course, have made a great difference to those women with the minimum income guarantee, the pension credit and the increase in the basic retirement pension.

On the issue of the married women's stamp, the hon. Gentleman is completely wrong. When that option was available to them, women made their own decision whether to pay full contributions or the reduced rate. If they paid the reduced rate, they still receive 60 per cent. of their husband's pension. In today's terms, the husband gets a pension of £77 a week; the wife, having paid no contributions of her own, receives a pension of £46 a week. It would grossly unfair to give someone who had paid no contributions—[Interruption.]—who had paid the reduced married women's stamp, which was not designed to pay for a pension, the full single person's retirement pension. That would give her the same pension as a married woman who had chosen to pay the full stamp, thereby reducing her earnings when she was in work. That would be grossly unfair and I am astonished that it is the position of the Liberals.

Does my right hon. Friend agree that one reason why women are poor in retirement is that they have caring responsibilities and take time off to look after children or elderly parents? What does she intend to do to address that issue?

My hon. Friend is right. I know that she, like me, will welcome the fact that the second state pension, which we are introducing, will for the first time allow women and men who have taken time out of employment for caring responsibilities to build up a proper second pension on top of their basic pension. Over time, that will benefit millions of carers, the vast majority of whom are women.

Will the Minister confirm that women with broken national insurance records will not benefit in full from the Government's new pension credit? Will the Government follow the call of my hon. Friend the Member for Havant (Mr. Willetts) that those women should be able to buy back the missing years?

I think that the hon. Lady is wrong about the pension credit, although I will check that with my right hon. Friend the Secretary of State for Work and Pensions and write to her. It has always been possible for people to make additional contributions to fill broken records or missed contributions. Indeed, the Department for Work and Pensions and its predecessor have, on several occasions, written directly to married women who had chosen to pay the reduced contribution to draw their attention to the consequences that that would have for their pension provision.