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Single-tier State Pension

Volume 543: debated on Monday 23 April 2012

I apologise to my hon. Friend for not giving her a chance to ask her question earlier on.

We will shortly bring forward a White Paper on the single-tier pension, as my right hon. Friend the Chancellor of the Exchequer announced.

I thank my hon. Friend for that reply. He and I have long campaigned for a citizen’s pension, to be paid at a decent level to all pensioners, without the need for bureaucratic means-testing and, of course, the problems that that creates, with many pensioners losing out. I welcome the plans for a single-tier pension from 2016. Will my hon. Friend confirm that, although the current proposals apply only to new pensions, there is nothing to stop a future extension to all pensioners if the money can be found?

Obviously, we will not write the law in a way that prevents all pensioners from being brought within its scope, and I am sure my hon. Friend will press for that. We are aware that, under our proposals, getting on for more than 80%, and eventually 90%, of pensioners will qualify for the pension, so it will have many of the features of a citizen’s pension but be based on 30 years of contributions or credits.

Well, that exchange was worth waiting for, I am sure the House will agree. I thank both Members.

Topical Questions

In recent weeks we have published new figures on the incapacity benefit reassessment programme, so I thought it would be helpful to the House if I just reminded Members of the figures. Throughout Great Britain as a whole, some 37% of people have been found fit for work, with another 34% expected to be able to work in the future, with the right support. These figures show that the programme is working.

Does any Minister think it appropriate that, while undertaking a contract on behalf of the Secretary of State’s Department, Atos Healthcare, first, published misleading information on its website; secondly, refused to comply with the Advertising Standards Authority inquiry into that information; and, thirdly, failed to correct it until alerted to do so by the media last week—several weeks after the compliance notice was issued? Do they think that that is acceptable for an agency working on behalf of the Government?

We always discuss issues such as that one very carefully with our subcontractors, but I do not believe that it affects the professionalism of the health care professionals who are carrying out the work on our behalf. Many are doing a very difficult job in challenging circumstances—but doing the best for people who claim incapacity benefit and who could have a better future.

Following earlier questions on pensions, will the Minister put on record the fact that the Budget and the Government’s decisions are the best news ever for pensioners now, as well as for pensioners in the future? The press and the Opposition appear to have somewhat missed the point.

My right hon. Friend is aware that, as Pensions Minister, I am responsible for people who are currently pensioners and for everyone who will be a pensioner, which is everybody, and we have good news for today’s pensioners: not only the highest-ever cash increase but, more than that, year-on-year above-inflation increases whenever earnings grow more rapidly—and, incidentally, an increase in the age-related personal allowance this April of more than £500.

May I associate myself with the words of tribute to Lord Ashley, who was a formidable champion of the people whom we came into politics to serve? He will be sorely missed in both Houses, but his inspiration will live on.

Two years before the election, the Prime Minister gave the pensioners’ pledge:

“The Government I lead will make sure that older and retired people are treated with dignity and given the quality of life they deserve.”

Will the Secretary of State therefore confirm, as the Institute for Fiscal Studies has said, that pensioners will be £315 a year worse off, thanks to the granny tax?

The changes announced by the Chancellor in the Budget will increase the age-related personal allowance this April by more than £500 and leave it at £10,500 for 65 to 74-year-olds while the allowance for those of working age is levelled up to that figure, at which point all people will have a substantial tax-free allowance that will be increased thereafter.

This is why pensioners on the doorstep are so cross—they know that they have been hoodwinked by the Government. This measure was dressed up in the Budget as a simplification. I think the Secretary of State detains his barbers for about as long as I do. Does he go along and ask for his hair to be “simplified”? I do not think so. A cut is a cut. On top of granny tax 1, we now learn of granny tax 2. Will the Minister admit that from 2014 pensioners will face a further cut of £900, and apologise for trying to keep it secret?

I do not recognise the figures that the right hon. Gentleman quotes, but I assure him that what matters most to the pensioners to whom I speak is a decent state pension. After 30 years of the pension declining in value relative to earnings, from now on it will rise every year by whatever is the highest of earnings, prices or 2.5%. There will be a guaranteed increase every year that matches inflation or is above inflation. That is something that pensioners value.

T4. Does the Minister recognise that traditionally the Child Support Agency has targeted fathers who contribute willingly, rather than chase the more challenging maintenance evaders? (104394)

I understand that the current system feels unfair to many people. However, I reassure my hon. Friend that we do not target people in that way. We want to ensure that more people receive positive financial support. The tragic fact is that only half of children living in separated families currently have a positive financial arrangement in place.

T2. The Scottish Trades Union Congress reported today that the number of young Scots who are in receipt of unemployment benefit for more than 12 months has increased by 1,100% since 2007. Will the Minister confirm that those 5,000-plus young people will not be abandoned? What guarantee will he give about how many of them will be in work by this time next year? (104391)

Once again, it is the same story from the Labour party and its supporters. Let us be clear that what has changed in long-term unemployment since we took office is that we no longer hide young unemployed people—or, indeed, older unemployed people—on a training allowance, which distorted the figures by as much as 30,000 each month. That is why long-term youth unemployment and unemployment appear to be rising. It has nothing to do with economic change and everything to do with how disingenuous the previous Government were.

T5. The Child Support Agency’s office for London and the south-east is in Hastings. It employs nearly 1,000 to do an often difficult and challenging job. When the Minister brings forward her reform plans, I ask her to ensure that this important service is not relocated, because a great deal of local expertise has been built up. (104395)

I thank my hon. Friend for giving me the opportunity to pay tribute to the excellent work of the Child Support Agency staff in Hastings. I reassure her that the changes that we are planning will have a negligible effect on delivery staff.

T3. After the hard-fought and successful campaign to get the higher rate of the mobility component for blind and partially sighted people under disability living allowance, will the Minister reassure me that no blind people will be disadvantaged by the transition to the personal independence payment and that such people will continue to receive the higher rate of the mobility component? (104393)

The hon. Lady will know that we are in the process of finalising the assessment criteria for the new personal independence payment. I am sure that she will be reassured to know that I have met a number of organisations that represent blind people. I remind her that with the personal independence payment, we are trying to recognise the barriers that people face to living an independent life, and not simply to categorise them based on their impairment.

T9. I thank the Minister for agreeing to come to a jobs fair in Thanet in June. I am sure that he shares everybody else’s pleasure at seeing that there has been a small drop in youth unemployment. What more can I tell the young people of Thanet that we are doing to help them get the jobs that will be advertised at the jobs fair? (104399)

I am sure we were all pleased to see the small fall in youth unemployment announced last week, but there is a long way to go in tackling what is a big challenge for this country. I hope that the employers of Thanet will respond to the wage subsidies in the youth contract by giving young unemployed British people their first step on to the ladder of employment. That is what we all want to happen.

T6. We have heard a lot of talk from the Government about creating an information revolution in Whitehall, but with the Secretary of State’s Department leading a charge by outsourcing many of its responsibilities, will the same measures of transparency apply to private sector companies such as A4e and Atos as currently apply to public sector bodies? (104396)

First, with respect to the hon. Gentleman, I do not think that this Government, or this Department under its current management, need to take any lessons from one of the most secret Governments in history. If he would like to look on our website, he will see that we publish a huge amount of data on all the contracts that we let, down to a very low level. He can find out more information now, as a direct result of what we do. Obviously, private contracts are for private people.

Would the Minister like to clarify his earlier remarks about partially sighted people not being means-tested and judged on their savings but being awarded benefit on the basis of their need?

That is of course our approach right across ESA. We do not apply a one-size-fits-all approach. Those with the potential to return to work will receive help to do so, those who will be able to return to work in due course will get support and guidance along that journey, and those who cannot be expected to work will receive long-term unconditional support in the support group. That is absolutely how the Government should seek to work.

T7. Members throughout the House, including Ministers, have emphasised the importance of the care that must be taken in dealing with people with mental health problems as they approach their medical and capability assessments, particularly if they lose benefits. Some anecdotal evidence is emerging of suicides taking place among people who have lost benefits. Have the Government explored any of the coroners’ reports of cases in which there has been a reference to the loss of benefits as a contributory factor, and what lessons have been learned? (104397)

We will always examine something like that very carefully indeed when it happens. So far, my experience is that the stories are usually much more complicated, but that does not mean we are not doing the right thing. I passionately believe that we should help such people, particularly those with mental health problems. I have met people who have been out of work for years and years with chronic depression, but whom we are now beginning to help back into work. We have to be careful, and we examine such situations carefully when they arise.

Will my hon. Friend join me in congratulating Erewash credit union on its participation in the back to work scheme? A young person I met on Friday who is participating in the scheme is extremely enthusiastic about their prospects and future and now feels ready for the next step back to work.

I pay tribute to the credit union in my hon. Friend’s constituency. As she knows, the Department has given credit unions significant financial support. We have recently received a report on their future development and expansion, and we hope to bring forward proposals shortly to give them a greater role and an extended way of helping people on low incomes, through both finance and initiatives such as she describes.

Last Friday I attended Lewisham jobcentre and was told that between 1,800 and 2,000 people visit it every day. What extra resources are being provided to jobcentres in areas of acute unemployment to help people access work?

Most recently, we have increased the number of youth advisers so that we have additional support in places such as Lewisham to enhance our work to help unemployed young people get into work. I hope that those advisers will make a difference to young people’s prospects.

I am very pleased to tell the House that since May 2010, the total number of people in this country on out-of-work benefits has fallen by 45,000.

Is the Minister familiar with the recent freedom of information request that revealed that 1,100 employment support allowance claimants died between January and August last year after being assessed as fit for work? What steps is he taking to investigate this rather large number of deaths, and how come so many of those people were assessed as fit for work?

I am afraid that we cannot simply extrapolate one of those facts from the other. Sadly, we are all mortal, and circumstances arise that we do not expect. As I said to the hon. Member for Hayes and Harlington (John McDonnell), we always look very carefully at individual cases, but the Government are doing the right thing in trying to provide support to help people to get back into work. The worst thing for their health and well-being is for them to be on benefits for the rest of their lives if they do not need to be.

What discussions has the Minister had with the Department for Communities and Local Government on council tenants starting a business in their homes?

We discuss such matters at all times with the Department for Communities and Local Government. I promise my hon. Friend I will ensure that I raise that one.

May I take this opportunity to say to my opposite number, the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), that I wish him the very best of luck if he heads off to be mayor? I have thought of a great slogan: “Byrne for Birmingham: not just 9 to 5, but also a ‘night mayor’.”