I beg to move,
That this House, while welcoming the equalisation of the state pension age, is concerned that the acceleration of that equalisation directly discriminates against women born on or after 6 April 1951, leaving women with only a few years to make alternative arrangements, adversely affecting their retirement plans and causing undue hardship; regrets that the Government has failed to address a lifetime of low pay and inequality faced by many women; and calls on the Government to immediately introduce transitional arrangements for those women negatively affected by that equalisation.
I thank the Backbench Business Committee for giving us the time to debate this important issue. I especially want to take a moment to thank the WASPI team— Women Against State Pension Inequality. Pensions are incredibly complicated, as most people would imagine, but these ordinary women have taken the time to sift through all the information and have drafted one of the most comprehensive and articulate briefings that I have seen since being elected. I thank them for articulating their arguments so well.
The hon. Lady is making a very important statement, given that the former Pensions Minister has admitted that he made a bad decision, based on inadequate briefing. Is it not therefore only right that the House considers this decision today, takes it seriously and reaches the right decision, with the right information before it?
That is why the debate is so important, and we should call on the Government to act. However, because pensions are so complicated, it is important, not just for the benefit of some Members, or people in the Gallery, or those watching at home, to try to explain why those women have found themselves in the position that they are in.
To do that, we must go back to 1995, when the Pensions Act increased the female state pension age from 60 to 65. The purpose of that was to equalise the pension age so that women retired at the same age as men. That is fair enough; it makes sense and I do not think anybody would disagree with that principle. The Turner commission recommended that 15 years’ notice be given to individuals if their pension arrangements were to change to give them adequate time to respond appropriately. The 1995 Act technically did that. The equalisation—the changes—was not to be brought in until 2010, which technically gave women 15 years’ notice. The problem is that nobody knew about that. As late as 2008, fewer than half of women knew that they would be affected. The National Centre for Social Research stated in 2011 that only 43% of women were aware of the planned change.
The hon. Lady makes an important point about people not being aware. It would seem that Government Front Benchers are not aware: there is no Equalities Minister here and there is no Department for Work and Pensions Minister here. That is greatly concerning.
It is noticeable, and a pity, how few Conservatives have turned out.
It is important to highlight that the Government did not send out a single letter to women. There was no official correspondence between the Government and the individuals affected, alerting them to the changes that were going to happen to them. Even the previous Pensions Minister, Steve Webb, recognised that not everybody knew that the changes had happened in the 1995 Act.
A response to a freedom of information request states that the Department eventually wrote to individuals affected and that
“Mail campaigns took place between 2009 and 2013.”
That is 14 years after the 1995 Act. Women were not personally notified by anybody official until 14 years after the changes came in. That is 14 fewer years that women have had to prepare and to try to make alternative arrangements.
The hon. Lady is making an important point. In a nutshell, is not the injustice to that set of women the fact that they have had not one but two changes to the state pension age, that the process has been accelerated and that there are no transitional arrangements in place? Is not that the real unfairness?
I have a great deal of sympathy with what the hon. Lady is saying. I am glad that she agrees that the need for equalisation is generally accepted and that it is right and proper. Does she think that it might be sensible to urge the Government to look at the sort of 10 to 15-year transitional arrangements that were made in public sector pensions reform? Would that be a constructive way forward?
As I said, I do not think that anybody here has a problem with the principle of transitioning towards equality. However, we are talking about women’s pensions, and it is important to bring the discussion back to that.
Many constituents who have written to me said that the information in the letters that they did receive was conflicting. They were getting different information. In one case, a constituent was told that they had enough contributions to receive their full state pension at 60, which was a few months away, only to receive a further letter three weeks later telling her that she will not get her pension until she is nearly 66. Many of the letters did not even get to the people they were supposed to reach. Some people were told by MPs and Ministers that they must have given the DWP the wrong addresses, but those women had been living in the same house for more than 20 years, so I find that difficult to believe.
I want to make some progress.
Some people say, “You should not have to be written to. It’s your pension, you should be keeping an eye on it. You should be looking out for reports and things, and take responsibility.” But when giving evidence to the Work and Pensions Committee, financial journalist Paul Lewis told us that after researching this himself he could barely find any reporting of the issue at all in 1995. There were a few small press cuttings from the business pages at the back of some newspapers. A freedom of information request revealed that the Government did fund “broader” awareness campaigns, which ran in waves between 2001 and 2004, but that these campaigns
“did not focus on equalisation in particular”.
In fact, only one of the press adverts in those campaigns was focused on this issue—one press cutting roughly seven years after this had already been passed into law. It is quite evident that this whole thing became a total mess. I do not know whether it was not reported deliberately, for political reasons or fear of ramifications, or whether it was a genuine accident, but what I do know is that women were not notified. It was not reported and they were not given enough time to be able to make appropriate arrangements.
This brings us on to the Pensions Act 2007, which increased the equalised state pension age from 65 to 66 between 2024 and 2026. It gave all affected people 17 years’ notice. That is fair enough, but then we come on to what the hon. Member for Denton and Reddish (Andrew Gwynne) mentioned, the Pensions Act 2011. That came along and said, “Forget the 17 years’ notice, we’re going to rush this through. We need to do this right now.” The 2011 Act accelerated pension age equalisation for women and the subsequent increase to 66, effective from October 2016 onwards, meaning that affected women had only five years’ notice to try to remedy life plans that had been in place for years.
The hon. Lady is making an excellent speech and I welcome the debate she has brought to the House. Does she agree that many of these women have had a lifetime of low and unequal pay in low-paid jobs? They have had broken careers, because they have brought up children. Some may have got divorced or separated. Their whole life plan has been disrupted, destroyed and impoverished by this awful change.
I could not agree more with the hon. Gentleman and I will touch on that point later.
The 2011 Act made women wait an extra year to a year and a half to claim their state pension. However, we have to remember and take into account the context which is women did not know about the initial 1995 Act. We have a situation where there is a whole host of women who read about the 2011 Act and went, “Oh, God. Okay, I am going to have to be working an extra two years. I’d better start making plans. Oh no, wait a minute, I’m working till I’m 66. Where did that come from?” There is a whole host of women who have been given a double whammy. The Government have not and are not giving women enough time to prepare alternative plans. There have to be better transitional arrangements.
The Conservative ethos is to encourage independence and responsible choice, but how can that happen if we do not give people the time to make the responsible choices? By continuing this policy at such a high speed, the Government are knowingly and deliberately placing another burden on women who are already trying to deal with consequences of an Act passed 21 years ago that they have only now found out about. To put that into context, I am 21—that’s how old this is.
One of my constituents told me that she began working at 17 and chose to pay the full rate of national insurance on the basis that she would retire at 60. Other options were available to her, but she said, “I want to retire at 60 so I’ll pay the price, through national insurance, my whole working life.” She put it in a way that I think is a very good and accurate description of what is happening. She has now found out that she is not retiring until she is 66. She says:
“The coalition and this present Government have stripped us of our pensions with no prior warning and with no regard to the contract we all entered when we were 17.”
She uses the term “contract”. That is an important point, because pensions are not benefits; they are a contract. People enter into them on the basis that if they pay X amount of national insurance they will receive Y at a certain age.
That is also the case for my constituent who at 57-and-a-half realised she would no longer be able to retire at 60. She is a care worker doing an extremely physically demanding job. She now has to work until she is 66. She has had a low income throughout her life working as a care worker and now has to carry on doing this demanding job for a further six years.
I could not agree more. Every Member, if they contact their constituents, will recognise that this problem spreads across the whole of the UK and affects women of all classes, from different backgrounds and with different jobs.
In criminal law, if we want to send someone to jail, it has to be agreed beforehand how long that person is going away for, and if that needs to change, there are appropriate measures to deal with it. In civil law, if we enter into a contract, there are terms and conditions stating, “If you want to change this contract or break out of it, there will be a price to pay.” Why are pensions any different? This is a contract people have entered into, but it is now being broken and nothing is being done to allow them to transition. These women have done exactly what was asked of them—they have worked hard all their lives and paid their national insurance—but it is now being taken from them behind their backs.
What is worse, if the Government choose to continue with the policy, they will be completely ignoring the years of gender inequality these women have lived through. Another constituent of mine, Kathleen Birney, explains that she worked until her children came along. Her husband could no longer work because of a disability, but she was determined not to depend on state benefits, so she studied and became a primary school teacher. She cared for her husband and her children, and she never claimed a penny. She has based all her life plans and financial plans on the basis that she would be retiring at 60. She has now found out that she cannot retire until she is 66. Unpaid carers are the unsung heroes of our economy. They have saved consecutive Governments an absolute fortune time and again. Sadly, women in our society have had to live with years of performing gender roles, meaning that the vast majority of unpaid carers are women. They are the type of people this policy is hitting: people who cannot afford to go another six years without a pension. Some women, such as Kathleen, are being left penniless. They have nothing and are being forced to turn to the state for benefits. How does that fit into the logic of reducing public spending?
We will most likely hear the Government say, “It’s all okay because women will do better under the new single-tier state pension”, but there is a campaign called CARIISP—the collection against real inequality and injustice of the state pension—which is a collection of women rightly pointing out that a person only receives the higher rate of the new pension if they have paid 35 years of national insurance, but many women have not had the chance to build up that level of contribution. It is a separate issue; I mention it, first, to raise awareness and, secondly, in the hope it will earn a debate on its own merits.
The Government have said:
“The policy decision to increase women’s state pension age is designed to remove the inequality between men and women.”
That is a strange definition of equality: I am being shafted and short-changed purely because of when I was born and because I am a woman. That is not my definition of equality.
To conclude, there are two problems at the heart of this. First, there is the poor communication over the years, but all we can do is learn from that. I accept that the 1995 Act has happened, and all we can do is reflect on the mistakes made and not repeat them. The second issue, however, is the 2011 Act and the rapid changes the coalition and this Government have made. We can do something about that. Unlike most things that come from this Government—I mean this sincerely—I do not believe that this policy was vindictive or done in the knowledge that it would hurt people. I genuinely think we have ended up in this mess purely because of mistake after mistake, but any mess can be cleared up. If they continue with this policy, however, in the full knowledge of everything that has been and will be outlined, it will become vindictive and deliberate, and it will be done in the full knowledge that people will be hurt.
I understand that we have to work in tandem and with responsibility when it comes to the economy, but that does not mean punishing people who are about to retire. Every topic we speak about in this Chamber comes down to: “Where are you gonna find the money?” I understand that, but the answer is always austerity, no matter how brutal or who it affects. In this Chamber since I was elected we have had a go at people on low wages, the disabled and women, and now we are having a go at pensioners. We can afford to send airstrikes to Syria and to pay for nuclear weapons, but we cannot afford to look after our pensioners? I just do not buy it. The women up in the Gallery right now did not cause the financial crash, they are not responsible for the state of our economy and they did not make the irresponsible decisions that got us here. I understand the question, “Where are you gonna find the money?”, but I refuse to accept or believe that it has to come out of the pensions of older women.
I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on leading today’s debate, for which there is an extraordinary turnout, showing the considerable interest of so many Members in this subject. I became involved in this campaign somewhat by accident. I was approached, as were many other hon. Members, by several constituents who said they were going to be disadvantaged. None of us realised the extent of the hundreds of thousands of women who stand to be treated disproportionately unfairly.
I went along to the Westminster Hall debate, which was led by the hon. Member for Worsley and Eccles South (Barbara Keeley). I expressed my sympathies and I recorded a short podcast on the subject, which has now been followed by 145,000 people, many of whom have written to me about it—and not just my own constituents either.
I want to pay tribute to the Women Against State Pension Inequality campaign, which has articulated the case so well in front of the Select Committee. Its petition has now been signed, I believe, by more than 103,000 people. I want to thank the WASPI campaign for the help and support it gave me, not least in telling non-constituents to write to their own MPs rather than have them all writing to me—and I am exceedingly grateful for that.
We all agree with equalisation of the pension age. Large sums of money are involved and difficult decisions have to be made, but it is important that the rule of fairness is applied as much as possible, and it is clear that a sizeable group of women seem to be bearing the brunt of these changes disproportionately.
The hon. Gentleman is making an important speech. I would like to ask him, while he talks about fairness, whether he realises how this feels for women of my generation who owe everything to those women who were born in the ’50s and who fought for the Equal Pay Act 1970 and for all the advantages that have given us any chance. Does he feel that unfairness to those women, as I do?
I applaud the hon. Lady. I have had representations from constituents who were in low-paid jobs with huge caring responsibilities for children and other family members when they did not have access to free child care and other things—and we have them to thank. Yet it is those people for whom I believe there has been a breach of trust, as these changes hit them disproportionately. We have a large duty of care to them, but I do not think we are going to fulfil it.
I very much agree with everything my hon. Friend is saying. Will he concede that in other pension reforms, we were anxious as a Government to make sure that there was protection for those who were not able to change their circumstances? This operates particularly unfairly on people such as one of my constituents who has worked all her life but is unable to return to work because of a pre-existing medical condition, so she cannot change her circumstances.
My hon. Friend is absolutely right. That is why fairness needs to be applied to everybody, and in this case, there is a cohort of women who are simply not being treated fairly. Our state pension system is funded on the contributory principle. This is not a state benefit for which no prior commitment is involved, yet this group of women who have been paying national insurance contributions over many years in good faith and who have fulfilled their end of the deal face being short-changed retrospectively.
We need to bear in mind many other factors. Fewer than one in four women who qualify for the new state pension in 2016-17 will get the full amount. Right up to 2054, fewer women than men will qualify for the full standard pension. Women are significantly more likely than men to work part time, and to do so for longer periods throughout their working lives, largely driven by caring roles, as hon. Members have mentioned. They therefore tend to be under-pensioned.
I welcome the fact that the new single-tier pension will recognise periods of time spent caring, which will help in the future, and I acknowledge that the Government have made progress on shrinking the gender pay gap—an issue on which consultation is in place. Progress has been made, with more women in work than ever before. We have seen lots of generous reforms—on entitlement to free child care, the national living wage and so forth—but all those are far too late for a generation of women who relied on work without many of the benefits that we now take for granted, while bringing up their families and discharging their caring responsibilities. Because of the number of women who are going out to work, many others have caring responsibilities for grandchildren as well as having to hold down part-time jobs.
I will not give way again, because so many other Members wish to speak.
It is right for the rise in the pension age to reflect growing life expectancy, but a number of recent medical and actuarial studies show that life expectancy for women aged 65, 75, 85 and 95 fell in 2012, while rates among men continued to rise. There are big discrepancies in life expectancy among some of the poorest women in society, and, of course, those born in the 1950s—the ones whom we are discussing today—are the most reliant on the state pension, and therefore the most vulnerable to the changes. There are grounds for querying why members of that group are being hit disproportionately.
There is also the question of whether the women were given proper and adequate notice. I think we all agree that that clearly did not happen. The money expert Paul Lewis, who has helped to articulate this campaign so successfully, has given details about how little notice some women received:
“Approximately 650,000 women worst affected by the speed up— those born 6 April 1953 to 5 April 1955—were written to in…February 2012.
That means they got their letters between the ages of 57 and almost 59 that their pension age would not be 60.”
Some women received no notification at all.
Will the hon. Gentleman give way?
I will not give way.
Those women had precious little time in which to make alternative arrangements, even if they could afford to. That could not happen now because of changes introduced in the state pension review of 2015. However, Angela Heasman, one of my Shoreham constituents, pointed out:
“A very important point that I feel has been missed here is that if one considers what if ten or 15 years notice bad been given? For the women, like myself, who are low earners in part-time work, they would not have had enough or any disposable income to pay into a private pension on top of the high and ever rising contributions to National Insurance.
To put this in perspective, in order to save enough into a private pension for an annuity of £6,000 pa you are looking at…£100,000. This is why for low paid people their National Insurance contributions are all they can afford and consequently totally dependent upon a state pension. Therefore even ten years notice is not enough time for the low paid to pay into a private pension that would equal the State Pension.”
She suggested that
“the reintroduction of Pension Credit, which is means tested, would alleviate, at a stroke, those who find themselves in this invidious position. If Pension Credit could be reinstated from 60, and add on Pensioner Benefits this would lift those who are genuinely hit the hardest out of extreme poverty.”
I ask the Minister to consider that suggestion.
It is difficult for many older women to stay in the workplace or get back into it. Unemployment rates among women over 50 are well above the national average. The gender pay gap is at its worst for women in their 50s—exactly the sort of women whom we are discussing.
Recent comments from Steve Webb, the former Pensions Minister, strongly indicate that he acknowledged that the Department for Work and Pensions had been at fault in failing to provide adequate notice for the women affected when he made a big fuss about negotiating a six-month concession at the time. That has been compounded by his recent comment that the Government had “made a bad decision” about the state pension age, and had been badly briefed.
During previous debates, when the last changes were made, the Minister gave strong indications that transitional arrangements would be made for the worst affected, but that has not happened. Why not? Will the Minister please revisit that undertaking?
As I said earlier, I have received many e-mails from around the country and from my own constituents. Let me end my speech by quoting the closing paragraph of a letter from a woman in Worthing. She wrote:
“I have also heard some MPs say that older people should downsize their homes to free up the housing stock for families. We did this so that our larger house, where my husband had lived all his life, could be enjoyed by a family but we are quickly using up any money for normal day to day expenses…It seems that we older women who have contributed to society are considered unimportant and not worth the financial support that we have earned over the years.”
I believe that we risk breaching the trust of women who have made many sacrifices, and who do not now have the expectations for their retirement that they were led to believe they would have.
I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) first on securing this important debate, and secondly on the forceful way in which she put the case. She was strongly backed up by the speech of the hon. Member for East Worthing and Shoreham (Tim Loughton).
I just want to make two points by way of introduction. The first is to also congratulate Women Against State Pension Inequality—WASPI—on the powerful way it has put this case and conducted its campaign. Secondly, I want to say there is a basic unfairness in this problem that does need to be addressed. Into the bargain, there is a broken promise—or a broken contract, as I think the hon. Member for Paisley and Renfrewshire South described it—between the state and the women who are affected.
I received a very well put-together letter from a constituent. I will not name her as she marked it “Private and Confidential” and I think there is a message in that for me. Nevertheless, I thought it would be as well to use her words as much as possible, because this is someone who has been directly affected. The points she makes have already been reflected in the two speeches so far, but I think they bear repetition in her own words. The first point she makes is that she was given
“Inadequate notice and communication regarding the age change—I received less than 4 years instead of the recommended 10-15 yrs. This has had disastrous consequences on the important financial and life changing decisions I made in anticipation of my retirement at 60 and receipt of state pension.”
I am sure my right hon. Friend has, like me, had a number of women make representations to him. I met some women on Monday for whom this has changed their life for the worse. I am sure my right hon. Friend will agree that this is discriminatory against women.
I was going to come on to that very point.
The second point my constituent makes is that she was
“Hit by 2 pension age increases first to 65 and rapidly in succession to 66 resulting in the loss of over £35,000”.
The final point she made that I want to highlight is that she is
“No longer eligible to receive the old state pension into which I paid full contributions for over 40 years. I will not receive a full new state pension due to the shortfall of contributions between the ages of 60-66. A factor in my decision to retire at 60 was that I had paid in excess of the 39 years contributions that were required for a full state pension at that time.”
This is a crucial debate not least for my constituents Jackie Williams and Debbie Watkins who are active in the WASPI campaign. My right hon. Friend might be pleased to know that the Minister responsible for this issue says the reason she cannot carry out the terms of this motion is that it would be impossible. He and the House might care to know that, as Ros Altmann, she was a very effective advocate on pensions issues when I was the Work and Pensions Secretary, and when we were arguing that the pension protection fund we had introduced should not be applied retrospectively, as she wished, I said it was impossible. Ros said to me, “That word doesn’t—”
Order, Mr Johnson; come on, you are in the next debate as well. In the interests of fairness, we have a very tight time limit and must have short interventions so nobody drops off the list—and I know you would not want to do that to anybody.
Thank you, Mr Deputy Speaker. My right hon. Friend brings a wealth of experience and understanding of this subject to the contribution he has just made and I am very grateful for it, lengthy though it may have been.
If I can continue with the quote I was midway through from my constituent, she goes on to say:
“This requirement has now been reduced to 30 years. To be faced with an overpayment in the old pension requirements of 10 years contributions which I am no longer eligible for and to have a shortfall of 6 years in the new pension requirements is beyond belief.”
I want to conclude by quoting my constituent again. Her comments illustrate why the WASPI campaign is so reasonable. She says:
“I understand that the equalisation of state pensions had to be addressed but I object to the unfair way that this was handled creating more issues of inequality in the process. Future generations will be given 10 years notice on age changes whereas I and many like me were not. I am requesting that transitional protection/arrangements be provided for the 1950s women affected by these changes.”
Of course all Governments have to consider the financial situation, make proper arrangements and understand the economic difficulties that they face, but this is a basic question of inequality and unfairness.
I cannot give way again.
This matter has to be addressed, and I hope that the Minister will understand the strength of feeling that exists not only among those out there who are affected but in this House. We feel that this is an injustice, and all injustices have to be put right, as this one should be.
It is a great pleasure to follow the right hon. Member for Knowsley (Mr Howarth). I should like to praise the reasonableness of the Women Against State Pension Inequality—WASPI—campaign. Several campaigners have come to my constituency office, and they have put forward their arguments in a cogent, respectful and thoughtful manner.
Since 2010, this Government have been taking the difficult decisions necessary to get Britain’s deficit under control. This has often been contentious and involved many political disagreements with the Opposition. Since the Turner report, however, the one area on which Members on both sides of the House have in no small degree agreed is pensions. For more than a decade, MPs from all parties have been working together to tackle the challenges posed by an ageing population and to ensure the long-term financial security of elderly people. This quite unusual political consensus was both necessary and heartening in dealing with a long-term issue.
It is no secret that, without change, our current state pension arrangements will simply not be financially sustainable. People are living longer than ever: a teenager today can expect to live until the age of 90. That is to be celebrated, but it also imposes serious burdens on welfare systems that were designed in another age. In the last Parliament, the Government estimated the cost of abandoning state pension age reforms at a completely unaffordable £23 billion, the equivalent of putting 7p on income tax.
Much of this debate focuses on the impact of these measures on women, so perhaps we should reflect on how much this Government have done to improve the position of women in the pensions system.
Before the hon. Gentleman tells us that everything is okay, would he like to hear the experience of one of my constituents? She says:
“I have worked full time since leaving school at 16. I am now 61. I have worked through 10 years of kidney failure, dialysis and finally a kidney transplant. The effects have taken their toll. I cannot afford to retire without a state pension so I have another five years of my current life to look forward to, assuming my kidney does not fail or I die of something else.”
Surely that level of hardship is unacceptable.
I thank the hon. Lady for putting the words into my mouth that everything was okay. I remind her that she is a member of the party that was in government from 1997 to 2010, and if there is anything amiss regarding the publicising of these changes, Labour Members ought to look to themselves in that respect.
The motion regrets that the Government have
“failed to address a lifetime of low pay and inequality faced by many women”.
I really do not recognise that. Let us consider two central planks of this Government’s policy—namely, raising personal allowances and increasing the minimum wage to the living wage. Both those initiatives benefit women tremendously. In addition, the Government are looking at options to reform pensions tax relief, which was left unaltered by the Labour Government.
Following the Budget, research carried out by the House of Commons Library showed that women would be twice as likely—if not more—to be hit harder than men as a result of the Chancellor’s measures. If the disproportionate way in which women have been treated and the discrimination that they have suffered are not addressed by this Government, that will simply add to a long list of ways in which the Government have continued to fail the women of this country. Does the hon. Gentleman not agree with that?
I really do not agree with what the hon. Lady says whatsoever. The raising of the personal allowance, combined with the rise in the minimum wage, will give a huge boost to British workers and to women in this country, and she should recognise that fact.
In addition, the Government are looking at options to reform pensions tax relief. If Ministers choose the option that I am calling for, as others are, and they dispense with the top rate of tax relief and move to a single rate of relief, somewhere around the 30p in the pound mark, it will hugely advantage women in the workforce. It would be a real game-changer for the retirement savings of millions of hard-working British women. Equalising the pension age may pose short-term challenges, but it is an overdue acknowledgement of the role women play in the modern workforce. It is quite wrong for the Government to structure the pension system around the assumption that women’s careers—
My hon. Friend made an important point about there being more women in the workforce. There is evidence to show that women directly affected by the state pension age equalisation have increased their employment rate by 6.8%, to 40.7%, according to the Department for Work and Pensions in November. Older working-age women are now more likely to be in employment than at any time over the past 30 years.
I am sorry, but I cannot give way again.
One of the most encouraging things we have seen under this Government is that people are staying in work for longer. The move to equalise the pension age may pose short-term challenges but it was an overdue acknowledgement of the role women play in the modern workforce. We are also enacting very important reforms to the period for which someone has to pay national insurance before qualifying for the full state pension. Until relatively recently, that stood at 39 years for women and 44 years for men. That is surely the worst of both worlds, in that it is structurally unequal while being long enough to penalise women who take time out of work to have children. Under the new arrangements, time taken out of employment for caring or to raise a family will be counted towards someone’s national insurance record, and the new, equal length of 35 years no longer penalises such women. Moreover, by bringing the male contribution periods down to the same level, the Government have recognised that many men may also desire a different work-life balance than was traditionally the case in the past.
I am not in the habit of quoting Liberal Democrats, but I will make an exception in this instance over the Government’s decision to defer the date at which the state pension age will rise to 66, at a cost of £1.1 billion. While in office, Steve Webb, the former Pensions Minister, put it as follows:
“a billion quid is a serious amount of money.”
This decision means that almost a quarter of a million women who faced a sudden increase of 18 months or more in their pension age no longer face that possibility. We have also instituted the triple lock, which ensures that pensions are increased by the highest of three measures: price inflation, growth in earnings or 2.5%. That means no more of the sort of infamous bag-of-peanuts increases we saw under the Labour party. Also, we must not forget that the new state pension will be higher in value than the old one and far less complex.
We in Britain are rightly proud of the care we take of our elderly citizens, which has been shown by a marked reduction in levels of pensioner poverty in the previous two decades. It would be wrong to take serious risks with long-term economic sustainability and our pension system for the sake of winning short-term political battles.
First, I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on her outstanding opening speech, and the Backbench Business Committee on allocating time for this important debate. I am heartened to see the support from my Front-Bench colleagues, including my neighbour, my right hon. Friend the Member for Leigh (Andy Burnham), and my hon. Friends the Members for Oldham East and Saddleworth (Debbie Abrahams) for Newcastle upon Tyne North (Catherine McKinnell) and for Stretford and Urmston (Kate Green)—she is also my neighbour. I know that they all strongly support this campaign and the women in their constituencies who are affected by this issue. I congratulate the WASPI campaigners, who have worked tirelessly on this issue. They have now gained 107,000 signatures—perhaps 108,000 since the start of this debate.
The increases in the state pension age made by the Pensions Act 1995 and the Pensions Act 2011 have had a disproportionate impact on 1950s-born women. As we have heard, many received little or no notification of the changes, despite the Government saying that people must have 10 years’ notice of such changes. Indeed, the financial journalist Paul Lewis found that none of the 1950s-born women had been given 10 years' notice. In the worst case—we have heard about one of the worst cases from my hon. Friend the Member for Bishop Auckland (Helen Goodman)—women were told at 57 and a half that their pension age would rise from 60 to 66. Women who expected to retire at 60 can now find themselves without a job, without a pension and without money to live on.
The former Pensions Minister, Steve Webb, has admitted that the Government made “a bad decision” over these changes. His excuse was that Ministers had not been properly briefed. It appears that civil servants did do a poor job on this legislation; astonishingly, the impact assessment for the 2011 Act states in its conclusion:
“Overall…based on the available evidence, the change to the previous timetable will not have a disproportionate impact on any group compared to another.”
The fact that my hon. Friend had a recent debate in Westminster Hall on this very subject should send a message to the Government that people want action on it. Does she agree with my constituent Linda Gregory, who was born in 1953 and points out that she has been working since the age of 15 and therefore is being penalised even more than people entering the workplace at the age, which is the normal standard nowadays?
I absolutely agree with what my hon. Friend says and I thank her for coming to that earlier debate.
It seems unbelievable that civil servants and Ministers could believe that taking billions in pensions away from a particular group, adding years to their state pension age and then not informing them in good time would not have a disproportionate impact on that group.
I raised these concerns, which had been brought to me by the class that left Foxhills comprehensive school in 1970, on Second Reading of the Bill that became the 2011 Act. When I did so, the Secretary of State for Work and Pensions, said:
“I have had letters from the public stirred up by a number of people”—[Official Report, 20 June 2011; Vol. 530, c. 51.]
Does my hon. Friend agree that this is not just something being stirred up by a number of people, but a very real issue that we have known about for some time?
I do agree with my hon. Friend and I thank him for the work he has done on this matter since that Second Reading debate. These changes are having a disproportionate impact on my constituents and on his, and I have heard from WASPI campaigners who are also badly affected. As we have heard, many have health problems that stop them working and others have given up work to care. One of my constituents affected by the changes has worked for more than 44 years and has raised two children. She suffers with osteoarthritis and she tells me that she suffered the indignity of having to attend the jobcentre, where she was told that she was only entitled to six months’ jobseeker's allowance. Unable to find work, she has to use her hard-earned savings. She has said:
“I must watch my savings dwindle on living costs rather than enjoyment, I wish I had not bothered being frugal all my life, as by the time I get my pension I will be broke or dead.”
I am grateful for the sterling work that my hon. Friend and others have done on this campaign. Does she agree that there is a particular problem here for women in places such as Blackpool who have only been able to work part-time for a long period and are nevertheless having to take on some of the carer and other issues that people have described?
Before the 1995 Act changes, the independent Social Security Advisory Committee said that savings made on raising the state pension age should be spent on the most vulnerable groups, with help specifically for low-paid women, women returning to work and carers. That advice was not followed. Recently, a court in the Netherlands ruled that raising the state pension age could be considered a breach of the European convention on human rights. A woman in her 60s appealed against a two-year increase in her pension age because it created an “individual and excessive burden” on her. The court found in her favour. It is welcome that some Conservative Members who voted for the acceleration of the state pension age in 2011 are now supporting the WASPI campaign. However, other Conservative Members are blaming European legislation for the shabby treatment of the pensions of 1950s-born women—but the facts are against them.
When the Minister answered the debate on 2 December, he said:
“Equalisation was necessary to meet the UK’s obligations under EU law to eliminate gender inequalities in social security provision.”—[Official Report, 2 December 2015; Vol. 603, c. 145WH.]
The same point has been made to WASPI campaigners in replies from Conservative MPs. However, research done by the House of Commons Library and my own research show that that is not the case. EU law allows countries to have differences in their state pension age, and it also allows lengthy transitional arrangements to be made.
Library research notes that directive 79/7/EEC requires
“the progressive implementation of the principle of equal treatment for men and women in matters of social security.”
My hon. Friend is making an excellent point about the fact that we need to reach a level of equality on this issue, but she is absolutely right that it is the pace of change and the transitional arrangements that are so unfair. Does she not agree that the continual changing of the goalposts goes against the sense of fair play, justice and fairness on which this country should be based?
Absolutely. Furthermore, this background of EU law is not really a cause of the problem. The directive allows for different state pension ages. Indeed, article 7 of the directive specifically states that the determination of the state pension age is the right of member states. A 2007 European Commission report confirmed that different state pension ages are allowed. Equalisation of state pension ages is therefore described as “an objective to be strived for”. The Netherlands, Portugal and France have no current difference in their state pension age, but Austria and Hungary are equalising the state pension age with long transitional arrangements. In other states, a difference in pensionable age is currently maintained, or changes are being made very slowly. State pension ages will not be equalised in Poland until 2040, or in the Czech Republic until 2044. Bulgaria and Romania are retaining different state pension ages. EU law therefore allows different state pension ages and long transitional arrangements, and the Government cannot hide behind it and use it to explain what I see as a £30 billion “pensions grab” from 1950s-born women.
Transitional protections were discussed during the debates on the Pensions Act 2011 but were not brought forward by Ministers. It is worth saying that other countries have had transitional arrangements, or have amended their legislation to help specific groups. The Netherlands has a bridge pension. Italy brought in extensive pension changes, but made exemptions for people who were made redundant or who had a defined level of contributions. Later, Italy realised that public sector workers with a contracted career exit pathway risked being left with no job and no pension owing to the reforms. It then legislated six adjustments between 2012 and 2015 to protect those workers, via special derogations. The UK can and should put in place additional transitional arrangements to address the unfair consequences of this Government’s Pensions Act.
One of the unfair consequences is having to continue to pay national insurance contributions even though many 1950s-born women have already contributed for more than 40 years. Unfair differences in pensioner benefits also exist at a regional level. In November 2012, the Greater London Authority restored to Londoners aged between 60 and the state pension age the free travel that had been lost under the Pensions Act 2011. Bringing in the 60+ London Oyster card , the Mayor of London said:
“Londoners who have grafted all their lives and expected to receive free travel on retirement, quite rightly felt cheated when the age escalator removed the Freedom Pass from their grasp.”
What about women living outside London who have “grafted all their lives” and who also felt “cheated” when the 2011 Pensions Act removed both retirement and free travel from their grasp?
The UK reforms cannot be justified on the basis that the previous system was unsustainable. Historically, the UK state pension has been one of the lowest in the OECD. EU law allows transitional arrangements, so the Government cannot justify their changes by hiding behind that law. The lack of transitional arrangements in the UK for 1950s women is due to decisions made by this Conservative Government. I urge the Minister to look again at the issue and at ways of providing adequate transitional protection.
I am pleased to take part in this debate, and I congratulate those who have secured it and those who are working so hard outside this place to contact their Members of Parliament to talk about this very, very important issue of public policy and the impact of it.
My starting point is a passionate belief that a civilised country provides for families, protects the most vulnerable, helps those who look for work, and supports those in retirement. I am looking for the principles that we might apply to this debate based on the petition that has been presented. As I understand it, the petition raises three particular concerns: the lack of notice; the changes being made faster than expected; and the lack of time to plan. I recognise some of those concerns in what I have heard from my constituents. One told me that they had worked since they were a teenager, and that they were concerned about their own health challenges, their caring burdens and the prospect of re-planning. Other constituents are worried about the way the retirement dates work out. Indeed, one told me in 2011 that
“a woman who is just two months older than me can retire a whole year earlier.”
Again in 2011, a constituent told me that she was concerned about the “double attack” on her. She described how she felt when she received the first notification of change. She said she
“didn’t like it, but eventually accepted it and made the necessary changes to her plans, both mentally and financially”.
She then received another notification of change and was then forced to readjust a second time.
Another constituent put forward a very powerful and emotional argument. She said:
“When I first heard that my retirement age had gone up from 60 to 64 I was shocked and tried to ignore it.”
Those words seem to explain the communication problem that exists. The fact that a person was so shocked that they tried to ignore the problem shows just how powerful the problem is.
I, like my hon. Friend and many other Members in this Chamber, have had many emails on this matter from constituents. Does she share my concern that the people who are affected by this have worked all their lives and have made plans and are now having to change them? We must try doubly hard when it comes to notifying people on pension issues, because, whether we like it or not, pensions are not very exciting until one reaches a certain age, at which I am now.
My hon. Friend puts it very well. Let me repeat what a constituent has more recently told me. She came to my surgery and explained that it had come as a shock to her that she would have to wait until she was 66 before she could retire, she was not informed, and found out only when she requested a pension statement. That goes to the heart of this matter of being informed and of having time to plan.
I would like some clarification from the hon. Lady. Freedom of information requests suggest that details were not sent out until the late 2000s. Is she implying that all these women who say that they were not contacted were contacted after 1995, but just ignored the notification? I find it hard to believe that that is what she is saying.
No, the hon. Lady is mishearing me. I am citing directly from constituents. I will ensure that the Official Report reflects my citations. Let me be absolutely clear. I do not know whether the woman in question received the letter; how could I possibly know that? I know what my constituents tell me. I look forward to the Minister’s explanation of what has happened historically. I understand the point made by the hon. Member for Paisley and Renfrewshire South (Mhairi Black) who opened the debate that the past is the past and that there is only a certain amount that we can do if we are looking back at a problem that has its roots in 1995.
Let me now explain what I am looking for as we move forward. I have already listed a set of principles that we could apply. The first is that we should protect those who can no longer work. Secondly, we should provide the right support for those who can work. Thirdly, we should maintain sound public finances, as to fail to do so hurts every single person in the economy. Fourthly, we should of course promote better communications to enable people to plan. That is my main message to Ministers today.
Let me dwell on the point of equalisation. Earlier in the debate, there was a hubbub of people saying, “Yes, we all agree on equalisation.” Let me provide a few figures on why we need to do that. When the state pension age was first set at 65 in 1926, male life expectancy at birth was 64 compared with 89 today. Indeed, if the state pension age had risen in line with the average life expectancy at 65 since 1926, it would now be at least 75. We have a significant gap that we need to make up. Indeed, if we looked even further back in the history books, we would see that when the state pension was set in 1908, the average life expectancy was 41. Members can see very clearly the difference with which we have to deal. Lord Turner’s report on pensions, commissioned by the previous Government, acknowledged that a more generous state pension had to be funded by an increase in the pension age.
Let us also make sure that we are aware of the costs. I understand that there would be costs to the tune of £30 billion to return to the 1995 timetable. Let us compare that with a few other things, simply so that we have a well informed debate. The 2015-16 spending figures, as shown in the July Budget, include expenditure of £28 billion on housing and the environment and £34 billion on public order or safety. All that we spend on housing or on public order and safety is broadly equivalent to the sum we are talking about today.
Of course comparative statistics are extremely important, but does the hon. Lady not recognise the reasonableness of the WASPI campaign, particularly on the issue of pension credit entitlements, which has been raised today? As she will know as a constituency MP, those are often key to what people receive.
I thank the hon. Gentleman for that point; I do recognise the grounds of the campaign. As I hope I have made clear with remarks from my constituents, I recognise the importance of the issue for every single person affected. I will leave it to the Minister to reply to the hon. Gentleman specifically about pension credits, but let me give him one further example of what £30 billion can buy. It can buy some of the debt interest on his party’s Government’s financial catastrophe, on which we have to spend £36 billion in this financial year.
I will conclude, because I have only a few minutes left and I have already taken several interventions. We have to listen carefully to such a comprehensive and well informed campaign, and I am pleased that we are doing that today. I want my constituents’ concerns, which I have given prominence in my comments, to be balanced with everything else that the Government have to do. I strongly sympathise with the campaign, and in 2011 I was active in representing my constituents’ views to the then Pensions Minister to mitigate the two-year delay in about a quarter of a million women receiving their pension. My call today is for the Government to communicate considerably better than has been done to date. It seems to me that we cannot go back, and equalisation has to mean equalisation. We cannot delay it forever or duck it. We need to maintain the principles that I have set out and communicate better.
First, I apologise for not having been present at the beginning of the debate.
There is no doubt that this Government’s treatment of women in general has been abysmal: more women are in part-time, low-paid work and women are being hit harder than men by tax and benefit changes. It therefore comes as no surprise that the Government are resolute in refusing to redress the financial disadvantage that they have forced on women born in the 1950s. The Pensions Acts of 1995 and 2011 have resulted in millions of women’s pensions being delayed. That is of concern in itself, but given that most of those women have not been notified of those changes, it becomes more than a concern. It becomes a situation in which some people who are already struggling to get by are pushed into poverty.
Of course, I am in favour of equalisation, as are all the women I have spoken to. I accept that increases in life expectancy mean that any Government need to consider carefully the state pension age and the extension of working lives. However, if such changes are to be implemented, is it not the mark of any responsible Government who care about the people whom their legislation affects that they ensure that they let those affected know and do not introduce legislation that directly disadvantages millions of people?
As other Members have said, many of the women affected simply were not notified. Those who have been notified since the 2011 acceleration have received only two years’ notice, yet as we all know, the appropriate minimum notification period for a state pension age increase is generally agreed to be 10 years.
My grandma taught me that two wrongs do not make a right, and the women affected have been wronged time and time again. Given that there has been a successful legal action in the Dutch courts, is it not better that we form transitional arrangements rather than end up in the law courts?
Does my hon. Friend recognise that for many of the women affected, who are our constituents, there is a real threat of stress and stress-related illness as a result of the failure to inform them? The Government should take that seriously when they are trying to understand why so many Members want transitional arrangements.
I thank my right hon. Friend, and I will come on to some examples from my constituency of women who are experiencing such stress.
In my constituency of South Shields we have a higher than average number of people with illnesses such as chronic obstructive pulmonary disorder, left over from our proud heavy industry days. That means that we have a large number of women who are caring for relatives or husbands, including those who fall into the group disadvantaged by the pension changes.
One such woman is my constituent Lynn Wilson. She got a letter sometime in 2011 or 2012 telling her that she would be getting her pension not at 65 but at 66. That was a complete and utter shock to her, as she was still of the view that she would get it when she was 60. Lynn’s husband Derek was diagnosed with lung cancer four years ago. Owing to the pension changes Lynn has had to continue working, but she has had to reduce her hours so that she can care for Derek. She does a difficult and physical job, and she suffers from serious back problems and arthritis herself. She tells me that she has a small private pension that she and Derek could manage to live on if her back got worse, but that it would not last the whole six years she needs to wait for her state pension. She tells me that she continues to struggle, but we agree that it just should not be this way.
Does my hon. Friend agree that women such as her constituent face a double barrier? There is discrimination in the workplace as women are being forced to work longer, and the Government have also put barriers in the way of their access to employment tribunals.
I agree completely with my hon. Friend.
My constituent is not the only person who knows that things should not be this way. Baroness Altmann, who is now in the other place as Minister for Pensions, said when she was director general of Saga that the Government’s changes to state pensions were “clearly discriminatory”. In 2011, the Secretary of State for Work and Pensions made a firm commitment to look at transitional provisions to help the women hit hardest by the changes, and the previous Pensions Minister stated only last year that the changes that had been made were
“a decision that we got wrong”.
It is outrageous that, despite knowing that, the Government are not prepared to do anything about it. They seem content to let the women affected continue to suffer.
Another of my constituents, Dianne Dawson, took voluntary redundancy from her job when she was 60 years old, assuming that she would reach state pension age at 62. She then found out, not from the DWP but from a friend, that she would reach state pension age at 64. She is now living off dwindling savings, and as a result she is having to sell her family home. She has never received anything at all from the DWP. No wonder she feels completely let down and cheated.
There are many more women in such difficult situations, who have worked their entire lives only to find out at the eleventh hour that the system they trusted and paid into for decades has let them down. I urge the Minister to look seriously at the motion, because if transitional arrangements are not introduced, the women affected and Opposition Members will not give up pressing for them. I am sure the Minister agrees that it would be a lot more costly and embarrassing for the Government if those individuals began to seek legal redress. I just hope that the work of WASPI campaigners and others that has prompted today’s debate will lead the Government for once to listen.
I have sympathy with people when their expectations change and I thank my constituents who have emailed me to highlight this issue. I shall start by looking at the background to it.
The longevity of our population is rising, which is a good thing. It is great to live longer and women live longer than men—
Will the hon. Gentleman give way?
Not at the moment.
Women on average have a healthier longevity and that is increasing at a greater rate than it is for men. As a nation we spend a massive and increasing amount on our healthcare system and on our pension system in order to allow as many people as possible a happy retirement.
It was in 1908 that the Liberal Government under Lloyd George brought in the first provisions—[Interruption.] I am certainly not blaming the Liberals for that. A great man, Mr Churchill, was involved too. The age at which the state pension could be claimed was set at 70, compared with the average longevity of 55 at that time. That gives us some idea of the changes that have taken place since. In 1995 the retirement ages were raised so that they would be equal as between women and men in the future. That was further examined in the mid-2000s by Lord Turner. There was cross-party support for those ages to be raised further, given the increases in longevity that I mentioned.
Under the coalition Government, when I was not in Parliament, a decision was taken, based on further increases in longevity, to raise the retirement age even faster for a few people. One of the principles behind all the recent changes was the affordability of the system overall. We have heard that it would cost £39 billion to reverse those changes. That liability would apply to all age groups, and it would be unfair for us to continue to burden younger generations with extra taxes in order to make more concessions than we have already.
Not at the moment.
At the time of the last decision in 2011 a concession of over £1 billion was made to help the age groups who are contacting us now.
I want to say a little about equality. I have two very young daughters and I am keen that they should have equal opportunities, as far as possible, with men of this nation in the workplace and as citizens. I shall highlight a few things that make me think that we as a Government are doing well on behalf of women. The introduction of a single tier state pension will have a good effect on women. It will be equally available to men and women, based on the same approach to national insurance.
My hon. Friend makes an excellent point. Equality is at the heart of what we are trying to do for women. One of the ways that we are trying to achieve that is by decreasing the gender pay gap. That will be helped by increasing the minimum wage, increasing the availability of jobs and increasing the personal tax allowance. We are pursuing many incentives and programmes that will allow women to participate successfully for a little longer than they may have expected.
The issue at the heart of this debate seems to be the extent to which women were given notice and therefore the ability to plan for their retirement. I am sympathetic to anyone going through a stressful personal situation, but we need to be responsible. It is hard to say who was contacted or who was not, but from what I have seen—obviously, I was not involved in any of the previous decisions—it seems that most people were given notice of the change, allowing them to plan.
I have some advice for the younger generations who might be listening to this debate. I have some experience in the pensions world. The main thing that people have to remember when investing for their retirement is that the earlier they start saving, the more money they will have at the end. That is because of the power of compound interest, which has a tremendous effect.
My hon. Friend is making a wide-ranging speech. Will he join me in hoping that the Minister, in his closing remarks, will address the issue of communication with those who are working now and who hope to retire in the future, so that my hon. Friend’s young daughters and mine will know where they stand?
My hon. Friend makes an excellent point, the very point on which I had intended to conclude my remarks. We have a duty to the young people of this nation to keep their taxes down so that they have as much scope as possible to plan for their retirement. They are already being asked to shoulder an unacceptable burden that was put on them by the Labour party. It would be entirely wrong to reopen a decision that was taken by the Conservative and Liberal Democrat coalition back in 2011.
I am sure the women listening to this debate will be glad that the hon. Member for Yeovil (Marcus Fysh) feels sympathy for them. When he lectures people about saving early in life, he might want to recall that many of the women we are talking about were barred from paying into secondary pension schemes.
I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on securing this debate. She should not have had to do so—there should have been a statement from the Government. She said the subject was complicated. People always hide behind the notion—the hon. Lady did not do so—that pensions are very complicated, but this is a very simple debate. This is not a pensions debate; it is a debate about public policy.
We have a Chancellor who has a long-term economic plan—Members might have heard about it. It was supposed to end the deficit in four years. It was a complete and utter flop. He cannot even put forward a plan that lasts four weeks. Last year he came to the House with a Budget that would have been detrimental to working people, to those facing welfare cuts and to pensions. A few weeks later he came back with £27 billion in his pocket, which he had found at the back of the settee. That was going to be the way forward. With one leap, he was free. But this morning he is all over the media telling us, “Whoa, hang on. You’ve got it wrong. We’re in a mess again. We’ve got to put the brake on again. People have to realise that we are still facing lots of austerity.”
To give them credit, Government Members who have spoken today have trotted out that line and said how hard it is going to be, as billions of pounds are needed to put right the existing wrongs. However, we have to accept that this is not like the weather. This is a political choice being imposed on the people of this country. The Government are knowingly and deliberately making women, rather than the wealthy, pay for the mistakes that resulted in the crash in 2008, caused not by the Labour party, but by the bankers and the global markets.
Just yesterday I read that the National Audit Office had identified that the cost of the UK’s complex weapons programme has increased to £14 billion a year over the past few years. Does the hon. Gentleman agree that that is clear evidence that pensioners are suffering from the poor decisions and priorities of this Government?
That is absolutely right. The hon. Member for Solihull (Julian Knight) said that to put this right we would have to raise income tax by 7p. No, we would not. We could stop spending on other things. We could stop doing things like giving more money to the children of dead millionaires in inheritance tax bungs. We could stop giving businesses cuts in corporation tax at the same time as saying to poor people, “You’ve got to get even poorer.” The truth is that this has been a choice.
Two days ago, the salaries of the chief executives of the top 100 FTSE companies passed the average annual wage of working men and women. That is the level of inequality in this country. At the same time, we are saying to this group of women, “Sorry, you’ve got to carry the can for the failures of global capitalism.” By and large, Conservative Members simply do not care, because they do not understand the reality of life at the sharp end. My mother was one of the women who worked all her life. She was in and out of jobs where she was never allowed to join a pension scheme, and she was only able to build up a secondary pension scheme, so in the end she died in relative poverty. My mother died 15 years ago, but things have not really changed for the majority of women in this country, particularly the group we are talking about.
My constituent Elizabeth Ainsley wrote me a long, heartfelt letter from which I will quote only small bits. She says:
“My pensionable age has changed twice once in 1995 from 60 to 64…to bring women in line with men and then again when I was not notified until I was age 59 with 5 years to work to my retirement age that this had been changed from 64 to 66. This is just not enough time to prepare.”
My hon. Friend is making a powerful speech. He has reminded me of an email I had from a constituent who also said she had been double-walloped. When she was younger, she did not think about these things, but now she has health problems and she worries that she will be knocking on jobseekers door if this goes on.
Every one of us in this room, particularly Conservative Members, could read out cases from people who have written to us and come to see us about the inequality and the disgrace that is going on today and should never have been allowed to happen.
My constituent Elizabeth goes on to say:
“I started work at age 16 and believed for 25 years that I would receive my pension at 60 only to have this changed not once but twice”
in her lifetime. She continues:
“I feel betrayed by the government and that women of my age have been discriminated against most of our working lives, denied the ability to prepare for our retirement and are now taking the biggest hit of all so the government can rush through the transition to equal retirement age to save money.”
I believe that the Minister is a decent man, but I am not sure that he will have the power or the authority today to do what we think should be done.
The ex-Minister responsible for this was Mr Webb, the Liberal Democrats’ human shield. Where are the Liberal Democrats today? Is anybody here from the Liberal Democrats? Perhaps they are ashamed of him, as they should be, for being a human shield for the austerity agenda that they forced through during five years in coalition. He says now that he made a mistake. He admits that it was an error and he was not properly briefed by people in the DWP.
The hon. Member for Paisley and Renfrewshire South was absolutely right to say that this is a contract with the people of this country. Yet the people of this country had no say in that contract; there was no proper negotiation where they could say, “Let me have my say and you have yours.” It was a contract imposed on them, and it has been breached. That needs to be put right and we need to do the right thing.
That is absolutely correct. I am really glad that my right hon. Friend made that intervention just before I was about to sit down. We do want this to be put right. What we do not want is the shifty thing that happened when the Chancellor came here in December and said, “I’m not going to go ahead with the tax credits cut”, but had moved it round that so that it is going to come back and hit people on universal credit. We want this put right, and put right now.
This debate is in some ways a rerun of one held in December in Westminster Hall organised by the hon. Member for Worsley and Eccles South (Barbara Keeley), who has a long track record of campaigning on this issue. I congratulate my Work and Pensions Committee colleague, the hon. Member for Paisley and Renfrewshire South (Mhairi Black), on bringing this up and bringing to life, in a sense, the emotional feelings of many women of the ages most affected by changes to the state pension. She did so in a way that everyone here can relate to, because we all have pensioner constituents, and indeed members of our own families, who are affected.
However, there is a risk of overstating the case. My Select Committee colleague will not, I hope, mind my saying that when she said that nobody was aware of the 1995 changes because there was no correspondence, that was an exaggeration of the situation. We will never know exactly who was communicated with or who, probably most importantly, noticed and paid attention to it.
I will not give way yet.
We do know, though, that in 2004 the previous Government did a study on this through the DWP, as Labour Members will remember. That study concluded that three quarters of those affected had been communicated with effectively. Opposition Members may care to comment on that.
Not at the moment.
The fact is that quite a lot of people were told about this at the time and thought it was a long way off and therefore they did not have to pay attention to it, while others were not communicated with and have therefore found this to be a difficult wake-up call. There are lessons on communication that I will come on to and that I hope the Minister will address.
A lot of people want to speak, so let me carry on for the moment.
The hon. Member for Paisley and Renfrewshire South was right to quote the previous Pensions Minister, Steve Webb, as saying that not everyone knew about this. He has accepted that, as I think we all recognise. None the less, the argument that no transitional arrangements were made—arrangements that Opposition Members are calling for—is wrong. A significant transitional arrangement and concession was made in 2011 that affected 250,000 people and cost the Government—the taxpayer—£1.3 billion, which was a significant amount of money at the time. That arrangement was made because the then Pensions Minister and the then Government recognised advice from the Department saying that the waiting time for some women born in the 1950s had increased to as much as two years, and they wanted to reduce it to 18 months to benefit those 250,000 people.
What is interesting is that while the motion calls for further transitional arrangements, it does not spell out, nor has any Member who has spoken so far spelt out, exactly what transitional arrangements are being called for. Were the intention—
Hold on a moment—let me finish what I am saying.
Were the intention simply to change all the arrangements for women born in the 1950s and go back to the original proposal, that would, I believe—the Minister might want to put a more detailed figure on it—cost the taxpayer about £10 billion. Yesterday we had the shadow Work and Pensions Secretary, the hon. Member for Pontypridd (Owen Smith), calling for changes to universal credit that were not costed and for which he offered no alternative in terms of where the money would come from. Today we have a proposed transitional arrangement that might cost £10 billion, but its detail has not been spelled out, and neither has its exact cost or how it would be paid for.
I believe that it is incumbent on all of us as MPs partly to represent the emotional feelings of our constituents, as has been done very well by a number of Members today, but also to reflect on the reality, the cost and the implications of what is being proposed, which remains an open question.
Does the hon. Gentleman accept that we had a quest for equalisation in pensions that has resulted in an iniquitous outcome for the women we are discussing? Social justice demands that whatever the transitional arrangements should be—he makes a strong point about that—he and other members of the DWP Committee will work to find arrangements that would ease the iniquitous outcome of this equalisation.
In fact, the Committee had that discussion and we heard evidence from Women Against State Pension Inequality, which is a good, reasonable and sensible campaign. On the whole, its evidence to the Committee focused on the issue of communication, partly so that lessons can be learned so that when future announcements are made about what will happen in 10 years’ time, they are communicated effectively to those who will be affected. We do not want to end up in a similar situation in 10 years’ time, with another generation of women complaining about not knowing.
Does my hon. Friend, like me, hope that when the Minister sums up he will address the failure of the communication strategy since 1995 and right up to the current day? A constituent of mine was told in October that they had qualified for their state pension, but a few weeks later they were told that they had another three years to go. We really need to address that problem.
My hon. Friend is absolutely right and I am sure the Minister will comment on communication. As I said in the debate in December, there are clear lessons and it would be good to have future changes clarified. I know that a further review is planned in 2017, and longevity continues to increase. The average life expectancy for women, as projected by the Office for National Statistics, has already increased by 2.6 years since the 1995 proposals, and Adair Turner, whose report led to the consensus that this House held for many years, said not very long ago that, if he had done the report now, he would have planned for faster changes to state pension ages.
The hon. Member for Paisley and Renfrewshire South rightly said that at some point we will want to discuss the effect of the future state pension on women. In answer to her point about discrimination against women, I think it is really important that all Members and our constituents are aware that the new state pension will be much fairer to women than the old system. National insurance credits will be given for years taken out of work for caring or for bringing up a family. This is the first time this has happened in the history of the pension—it is a really important point. It will give women the same entitlement as they would get from national insurance contributions through earnings. That is a significant change and I would have thought that those Members who tabled the motion would want to allude to it.
I have listened very carefully to the hon. Gentleman. He has said that in 2011 the Government made a policy decision to accelerate and that they failed to communicate the effects of that decision to the many people affected. Why does he therefore conclude that the Government do not have a moral obligation to put that mistake right?
Actually, what I said was that the communication issue goes back to 1995, when I certainly was not in this House. For the bulk of the period from 1995 to 2010, the right hon. Gentleman’s party was in power. There is no point in pointing fingers at different parties, but that period is at the heart of the issue of communication, which the motion addresses.
On the question of what good advice we can now give those of our constituents who are not sure what they are going to receive in retirement, it is important that they ask for a statement. That is what the Pension Wise campaign, which is available to everybody, free of charge, is there to do. People should ask for their statement. Some 500,000 people have already taken advantage of that. It is the most effective communications tool and we should be using it to make sure that everybody—women and men—approaching retirement knows what they will receive.
When the latest changes to pensions were made in the Pensions Act 2011, Labour Members objected to them. We had many debates about the issue—I remember speaking in them—and focused especially on the double-whammy effect on women, but the Government went ahead and passed the legislation.
I want to explain to the Minister what my constituents have written to me—I will read some of it out—about how women are being affected by the changes. Every one of the women who has contacted me has said that they agree with state pension age equality, but they object to and have difficulty with the way in which it has been implemented, particularly the acceleration of the increase and the lack of information.
Some of my constituents who are directly affected by the changes have told me that, even now, they have not received any communication or formal notification of the changes from the Department for Work and Pensions. That is utterly unacceptable, given the gravity of the changes. Posting notices in women’s magazines and Sunday supplements is both patronising and ineffective. None of the women I have spoken to are readers of such publications; they found out about the changes through word of mouth.
As the increase in the pension age is literally life-changing, far more notice should have been given ahead of the changes, and the Government should have ensured that everyone affected can plan for their future. One lady I spoke to told me that she has lived at the same address for the past 30 years and has not received anything. There is no excuse for that. To suggest that people somehow knew what was happening is wrong.
I fully recognise that there has been a breakdown in communication from successive Governments, but does the hon. Lady have a practical solution to deal with that?
I will come on to the practical solution later in my speech.
Women have told me that their other major concern is that, even when they have been notified, they have not had enough time to prepare for the major changes in their lives. One of my constituents is 62 years of age and she was due to retire at 62 years and three months. However, she will now have to work until she is 65. Understandably, that has caused a great deal of distress and uncertainty for her, because she had been planning to retire in a few months’ time. Her plan was to co-ordinate her retirement with the birth of her grandchildren so that she could look after them and not have to resort to having the Government pay for their childcare. The changes have thrown her life into turmoil and, of course, the Government will now end up paying for that childcare.
Another constituent has told me that, anticipating retirement at 60, she took voluntary redundancy aged 58 and a half when her company was seeking to downsize. She was later informed that she will not be able to access her state person until she is 66 years of age. She now finds herself unemployed and having difficulty finding another job, because of her age. She has been left in financial hardship as a result of not being notified about the changes to the state pension age until it was too late. She is not the only example; many thousands of women across the United Kingdom are in the same boat.
The discrepancy of two years and two months for women born between April and December 1953 is simply confusing and unfair. The Chancellor of the Exchequer and the Government were told as much in the debates in 2011. It means that, for some constituents, the difference is about £14,000, which is a lot of money. Again, it is not just a few of my constituents who have been affected, but women across the country.
Hundreds of thousands of women have had significant changes imposed on them not just once, but twice, with a lack of appropriate notification, and retirement plans have been shattered, with devastating consequences. The Government seem to have failed to recognise the severe impact that the speed of the implementation of those changes has had on those women. The changes have not affected men to the same extent, as their state pension age has not been increased by such a large amount and they have had much more notice. The pension system has historically discriminated against women, and the new changes are yet another example of that.
I urge the Government to reconsider the provisions and to diminish their impact by making transitional arrangements that are fairer for those women affected.
I have listened with great interest to the hon. Lady’s speech and to those of other Labour Members, particularly to their references to transitional arrangements. I wonder whether she could help me. What does she mean by and what would she suggest as “transitional arrangements”, how much will they cost and how will we find the money?
I am glad that the hon. Lady has given me extra time for this speech. There are many different ways in which to deal with the issue; there is not one panacea or simple solution. If the Government want a comprehensive response from me about the way forward, I am very happy to put together a detailed plan about how to deal with this issue.
Conservative Members are constantly asking what a practical transitional plan might look like. Surely it is the responsibility of the Government to bring forward such a plan, which the House can then debate. This is an abdication of responsibility.
My hon. Friend may recall that a further transitional arrangement was proposed when the Bill went through in 2011. In October 2011, an arrangement was proposed that would have meant nobody had to wait more than a year, rather than up to 18 months, to reach their pension age. It would have cost £10 billion over 10 years, and it would have meant having a common state pension age in 2022. That was proposed, but the Government rejected it.
I am very grateful to my hon. Friend for his intervention, which I hope has helped the hon. Member for Louth and Horncastle (Victoria Atkins).
As I have said, I am very happy to pen a very detailed plan to help such ladies, but if I write it, I would like the Government to promise to implement it. Perhaps the Government will give me an assurance that, when I come up with suggestions about how to deal with various problems, they will say, “Yes, you are right: the hon. Member for Bolton South East has come up with a solution, and we will actually implement what she says.” Will the Minister make me such a promise?
I congratulate the hon. Members for Paisley and Renfrewshire South (Mhairi Black) and for Worsley and Eccles South (Barbara Keeley) on securing this debate.
In the past few months, I have met a number of my constituents who have been impacted by these changes. These constituents have detailed how the state pension age increases have had an impact on them owing to their being on the wrong side of the dateline. I have every sympathy with anyone impacted by these changes, and I can see why they have felt so much frustration. I congratulate the WASPI campaign on driving this debate.
Although it is true that any criteria changes regarding pensions, benefits or taxation in general are always going to have an impact on some people, I am conscious that the individuals we are talking about have, in many circumstances, worked for decades on the basis that they would receive their pensions at a prescribed time. However, I am also conscious of the fact that when actuaries calculated life expectancy, and therefore the number of years for which a pension would pay out, they did not expect it to reach the level currently enjoyed, and they would not have anticipated the current rising levels of health. These factors have driven successive Governments, and most OECD nations, to increase the pension age.
No. I will make some progress, if I may.
The question remains: what, if anything, can be done to lessen the impact on those who will now have to work for longer before qualifying for their state pension, particularly those who it can be demonstrated were not notified over time, as they should have been?
Does my hon. Friend agree with me and my constituents in Eastleigh that the notice period for some of the women was simply far too short? We hope that the Minister will agree it is a great cause of regret that the largest group of women affected by the pension age increase sadly got less than eight years to plan for it.
I thank my hon. Friend for making that point. I know she has led a campaign in her constituency to that end. Ideally, we will hear such a statement from the Minister. I believe pension changes require 10 years’ notification and that 15 years’ notice was given for the 1995 changes, but, as she mentioned, the notice period for the 2011 changes was eight years, and even down to five years. As I was not in this place at that time, I am certainly very keen to find out more from the Minister.
Where I have issues with the motion is that although I agree very much with the concern raised, I do not ultimately see a remedy. I stood on a manifesto commitment that pledged us to deliver a budget surplus by 2020, which means that compensation for this matter would have to be paid for by another group of my constituents.
I have real concerns about another age group in my constituency—those in their 20s and 30s. They are sometimes referred to as the packhorse generation because they are saddled with debts from university, which I and many others of my age group and those older than me did not have to endure. They are not in receipt of occupational pension schemes. They are paying high rents and struggling to afford a home of their own, and they are likely to be the subject of pension changes in decades to come if life expectancy continues to increase.
No. With respect to the hon. Lady, I will make some progress, if I may.
I am keen for the Government to assess what more can be done to help the women impacted by the pension changes, but I am conscious that, before my election to this place, they conducted a review and allocated more than £l billion to mitigate the impact on the worst affected. Further mitigation, if introduced, would then reveal the next age group to be impacted, and we would never be able to move on. If my Government’s manifesto is to be enacted, such further mitigation will have to be paid for by others in the form of increased taxes.
The issue of pensions is becoming increasingly vexed. It is undoubtedly the case that post-retirement life expectancy is now much greater than was envisaged when pensions calculators were put in place. Additionally, with the advances made to allow those in their 60s to remain fit and active, many people in their 60s and beyond are working in a manner that was not envisaged when those pensions calculators were put in place. This is a general change in life and working age expectancy—we all rightly celebrate it, because it shows that people are living longer and leading fitter lives in their advanced years—but it means that there is a funding gap. To avoid placing a financial obligation on those in their 20s and 30s, who are currently struggling to get on, that gap has required the country to revise the pension age to take into account the changes in life and work expectancy.
Does the hon. Gentleman not see that by forcing such women to continue to work until they are 66, he is contradicting himself? One of the reasons why people my age cannot get work is that it is being done by those trying to secure some income until they reach the pension age.
I thank the hon. Lady for making that point, but I do not agree with her. The reality is that if the change had not been implemented, £30 billion would have had to be found from elsewhere. I think there is an additional £8 billion in tax revenue to be found as well. Where would that money come from if not from the generation that she knows well?
I will continue to make progress. To me, it is a complete contradiction to say, on the one hand, that something needs to be done, but, on the other, that it will not have an impact on any other taxpayers over the generations.
Finally, I have the greatest sympathy for those caught by the changes who have had to revise their plans accordingly. This, however, is a settled matter, and I worry about what the impact will be on others if changes are now made.
Half a million women, including more than 3,500 in my constituency, are asking the Government why they have to wait up to six years longer for their state pension. During their working lives, they paid national insurance contributions expecting to get their pension at the age of 60, an age fixed in 1940 and five years below that for men.
In 1995, the Conservative Government set out a timetable to equalise the pension age for men and women at 65. They fixed a start date 15 years ahead—April 2010—and phased in the changes slowly, so that only from April 2020 would women born in April 1955 or later not get their state pension at 65. The pending changes were largely ignored except for a small section in the financial section of a broadsheet. The women affected, who were then aged 45, were not warned by the Department of Social Security.
One of my constituents, Angela Pugh, has sent me valuable information, and I thank her and WASPI. She outlined one woman’s experience. She said that the job market is not ready to accept older women and that many are forced to accept zero-hours contracts, temporary contracts or low-paid contracts that offer no financial security. Does my hon. Friend agree that those women—the backbone of this country—have been betrayed by the Conservatives?
I most certainly agree with my hon. Friend.
In 1995, 2020 seemed a long time away. In 2007, the Labour Government decided to increase the retirement age for both men and women to 66, but included a caveat that no changes would be made until 2024. In 2011, the coalition Government unsurprisingly reneged on that caveat and set a new timetable that was tough on women and broke a pledge that there would be no change until after 2020.
Does my hon. Friend accept that that is not the only way in which older women have been discriminated against? The raising of the tax threshold disadvantages older women much more than it disadvantages any other group, and the pay gap for older women is bigger than for any other group. Do we not need to hear the voice of older women more clearly in politics, as it is obviously being completely ignored by the Government?
Half a million women had their pension postponed further in 2011. One of the women affected is Lin Phillips, who was born in May 1954. I think she is in the Gallery. She will be nearly 65 and eight months when she gets her pension in January 2020, nearly six years after she originally expected it in May last year when she was 60. Only in 2011 when she read about the new plans did she realise that her state pension age had already been increased to 64. She was shocked to discover that it would be pushed a further 18 months into the future to age 65 and a half.
Altogether, half a million women face an extra delay of more than a year, and 300,000 face an extra wait of 18 months. That delay will cost them in excess of £12,000 each in lost state pension. That money is very difficult to replace. Few will have company pensions, because many firms excluded women and part-timers from their schemes. About half the women aged between 55 and 64 are not in work. Many of them—as we have heard, they are the backbone of this country—are caring for children and elderly relatives. The idea of their finding a part-time job in the current situation, or even a low-paid job, is ludicrous.
The changes to women’s pensions are categorically unfair and unjust. Lin, along with other affected women, started to campaign to push the Government into a compromise agreement for those most affected, possibly in the form of a transitional payment. My understanding is that the Secretary of State for Work and Pensions promised to look at that in 2011 but—surprise, surprise!—he never did. The WASPI campaign is the inspiration behind the debate. Those women have made us sit up and think.
Each of us will be able to tell of constituents who are affected by this gross injustice. Each of us will know of women who have worked and paid their contributions or who have spent the majority of their adult life bringing up the children of this nation. Each will have a different set of circumstances, but they will all say that, had they been written to in 1995 and told of the changes, they would have made appropriate arrangements.
WASPI accepts that the pension age must rise as people live longer but argue—most on the Opposition Benches would agree—that it is not fair to women who were not personally informed either in 1995 or in 2011. The Minister should beware: WASPI has a sting in its tail. Given the power of its argument and its ability to attract the attention of many in the House, its demand for fairness is a compelling one. It has a simple message and only asks for fairness.
I would say this to the Minister: do not underestimate the power of that lobby. Those women have managed to mobilise and get more than 107,000 signatures on a petition, which is far in excess of what is needed for a debate in the Chamber. In four days, they managed to raise funds through crowdfunding to engage the services of a barrister. From my contact with them, I can tell the Minister that they want justice, and that the buzz in the air from the WASPI campaign will not rest until they get it.
I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on securing the debate. I also congratulate members of WASPI—many of the women are in the Gallery today—on its magnificent campaign. Had they not had that campaign, I fear that the problem would have gone unnoticed and certainly would not have been addressed.
The Pensions Act 1995 increased the state pension age for women from 60 to 65 over the period April 2010 to April 2020. It was not a short-notice change—the notice was 15 years. In a debate in October 2013, the Minister, Steve Webb, accepted that some women did not know about the change at the time, but went on to say:
“Although it was all over the papers at the time, these women were a long way from pension age and probably turned the page when they saw the word ‘pension’”.—[Official Report, 8 October 2013; Vol. 568, c. 54WH.]
What a way for a Government to expect people to find out!
The coalition Government legislated in the Pensions Act 2011 to accelerate the increase in the state pension age, which became 65 in November 2018. They intended to equalise the state pension age at 66 by April 2020, but that was amended. During that debate, the then shadow Minister, my hon. Friend the Member for Leeds West (Rachel Reeves), expressed concerns. Largely because of that, the date was amended and we got a reprieve of six months. The Government seem to believe that that is some compensation.
I will not say much about the impact, because hon. Members who have read about it will know. Anne Keen, one of my constituents and a leading WASPI campaigner, is in the Gallery today.
Order. I did not mean to do this and I have tried to ignore it, but hon. Members are not meant to make reference to the Gallery. As much as we appreciate the people here, it is meant to be about the Chamber. I am sorry about this but we must not keep making reference to the Gallery.
I will not do so again, Mr Deputy Speaker.
The women affected were not informed of the changes to the system, so it came as a complete shock to Anne Keen when she discovered that her plans for retirement were in tatters 18 months before her 60th birthday. She said:
“In 2012 I received a letter saying my new state pension age was 63 years and eight months. I was absolutely shocked because I wasn’t told about it.”
She explained that people have been caught out by Department for Work and Pensions mismanagement following changes to pension law in 1995 and 2011. They were caught out again in 2011 when further increases were introduced with, they claim, little notification before their retirement age. She went on to say that many women were having to dip into their savings to survive rather than relax and enjoy their retirement as they had intended and planned. She said:
“Unless people requested a pension forecast, they would not have known about it. All we are asking for is a fair transitional arrangement”
and some consideration.
WASPI has raised important concerns about the changes, which affect millions of women who were born throughout the 1950s, and who are unfairly bearing the burden of the increase in the state pension age. In 2004, DWP research showed that only 43% of those affected by the 1995 Act were able to identify their retirement age. In 2008, the National Centre for Social Research found that only 43% of them were aware that the state pension age was 65. This change has left many women in financial hardship.
Anne Keen says that the situation is worrying. She points out that privileged people, such as MPs, judges and civil servants, have had their occupational pensions protected if they are within 10 years of normal retirement age. Why are women not being treated in the same way? Why are they not afforded the same protection?
Ten years’ notice will be given for any future changes to the state pension age so that people can cope with the change in circumstances. Is that not an admission that what has happened is wrong? The Government have said that they will not revisit the state pension age arrangements for women affected by the 1995 and 2011 Acts. These women have been dealt a severe and unjust blow. Put simply, the Government must revisit this matter and address the concerns.
I am concerned that some Government Members appear to have missed much of the main point of this debate. For clarity, I remind them that the opening line of the motion states:
“That this House, while welcoming the equalisation of the state pension age”.
I do not think anyone is suggesting that there is not an argument to be made for equalising the pension ages of men and women. There are serious long-term pressures that mean that it should be addressed with a degree of urgency. However, there is a fairness argument to be made about the way in which it should be done.
I, too, have been contacted by a succession of constituents—a succession of women who appreciate that action needs to be taken, but who are exasperated utterly by the continual shifting of the goalposts and the unfairness of not knowing where the finishing line will be, just to mix my sporting metaphors. They do not know when they are likely to be able to retire.
These women accepted the first change as something that had to happen. Perhaps it would adversely affect them, but they were persuaded that changes needed to take place. I am not claiming that they were delighted, but they did at least accept it. What worries the women I have heard from and women throughout the UK is that the first change proved not to be sufficient, the second came without warning and there is no guarantee or even probability of belief that it will be the final change.
These are women, as has been mentioned, who worked through times when the working environment for women was far harsher than it is now. They suffered more blatant sexism than is the case for younger women who enter the workplace now.
The hon. Lady is making a powerful case about how unfair this situation is. Does she agree that there is a particular unfairness for women born between 1951 and 1953, such as my constituent Catherine Kirby, who will be left worse off on a weekly basis because they will not qualify for the new flat-rate state pension, whereas men will? Does she agree that it would be simple to solve the problem by allowing women in that position to opt for the single-tier pension?
The hon. Lady makes an excellent point.
We are talking about people who were forced to accept being passed over for promotion. Some of them are still fighting for compensation for unequal pay. These people were given scant consideration when pregnancy and motherhood forced them to take time away from the workplace. Surely they deserve a little more consideration from the Government than they have been given so far. It gets more and more difficult for people to pick themselves up and get back into the workplace with the same enthusiasm as they did before if they feel that they are kicked back at every turn.
I accept that Baroness Altmann has a track record of campaigning for justice in this field, as has been mentioned. I certainly welcome the fact that we have someone with such a track record as Pensions Minister, but she appears to be a lonely figure in this Government. The pressure that is being applied by the Chancellor and the Prime Minister to drive down public spending means that she can do little on her own. The strange worship of the austerity idol, as I call it, constrains any attempt by any spending Department to deliver anything that might look like fairness or help for the poor and disadvantaged.
Does my hon. Friend agree that, given that the Minister in the coalition Government, Steve Webb, indicated that he was aware that not everyone who was affected by the changes was aware of them, the Government must take responsibility for that? Questions must be asked about why women were not more fully informed by the Government and were left in the dark for so long.
Absolutely; I agree with my hon. Friend and look forward to the Minister addressing those points when he speaks.
With the Government’s assault on benefits in full flight, we should remember that pensions and pensioners account for the largest share of benefit spending in the UK and that the Chancellor’s gimlet eye will turn inexorably towards pension provision when the other stones have been bled dry.
I do not think that any working woman is asking for special treatment on her pension. I certainly do not think that any of the many women who have contacted their MPs with concerns over these changes is a shirker or a scrounger. They simply want a bit of fairness and a sound knowledge of what the future is likely to bring. Women who started their working lives under one set of pension rules look like they may finish their working lives under their third set of pension rules, provided that there are no further changes down the line.
Providing these women with as much certainty as can be mustered and making sure that they will not lose out financially have to be the watchwords for the Government over these changes. As has been suggested, a gentle transition would be far more in keeping with the need to ensure that we do not exacerbate pensioner poverty or drive more of the most vulnerable members of society into poverty. I urge the Government and the Minister to keep that in mind.
I congratulate my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black) on securing this important debate and on moving the motion with such an impassioned, articulate and typically powerful speech. I also pay tribute to the hon. Member for Worsley and Eccles South (Barbara Keeley) for her speech and for being a co-signatory to the motion. I pay tribute to my hon. Friends the Members for Kirkcaldy and Cowdenbeath (Roger Mullin) and for Ross, Skye and Lochaber (Ian Blackford), who have consistently and effectively raised this issue since their election in May.
By the same token, I must pay tribute to the Women Against State Pension Inequality and their campaign to urge the Government to make fair transitional state pension arrangements for women born after 6 April 1951. In particular, it is important to show our appreciation to Anne Keen, who first raised the petition on this issue after receiving a letter from the DWP which said that her expected retirement age had been increased. Far from getting 15 or indeed five years’ notice, she was notified only 18 months before her 60th birthday. What an absolute scandal and disgrace. Last night the petition had more than 107,000 signatures. I imagine that it is now approaching 108,000. That is testimony to all those who have worked so hard to bring this matter to the Government’s attention, including constituents of mine in Airdrie and Shotts.
Unashamedly, the Government are shifting the goalposts at very short notice for hard-working women—women who have gone to work, bettered our industries, raised children and supported families, but who have not had equal employment opportunities, access to independent pension funds or the opportunities that we have today. These women who have made enormous contributions to our society for the betterment of us all will see their retirement age rise without fair or proper notice.
Does my hon. Friend agree that the Minister must come to the Dispatch Box and give an explanation to my constituents in Livingston, some of whom retired and finished their employment before they had even heard the news and many of whom did not have time to prepare or save before the news was upon them?
I wholeheartedly agree. Sadly, those are typical stories that have played out across the Chamber today. It is this simple but dramatic injustice that is so galling.
The simple truth is that women born in the 1950s will be disproportionately burdened by the Government’s plan for many reasons, not least because men of the same age are and have long been in a better position to offset at least part of the loss through savings or a private defined contribution pension scheme.
The Pensions Policy Institute, in its submission to the Work and Pensions Committee on the Government’s pension reforms, emphasised that point by illustrating that only 65% of women in the 55 to 59 age range are economically active compared with around 76% of men. The gap is even greater among those in the 60 to 64 age bracket: 34% of women are currently economically active compared with 54% of men.
My hon. Friend is making some excellent points. Does he agree that some Government Members seem not to recognise the sense of injustice and grievance that exists among women born in the mid-1950s, such as my constituents Andrea Gregory and Wilma Robertson, who have worked all their lives, paid all their taxes and had their retirement postponed by the state not once, but twice? The word that they use is “robbery”. They feel that they are being made to pay for a financial crisis that was not of their making.
I wholeheartedly agree. There have been some noteworthy speeches from Government Members, but some that have sadly not met the same standard. I hope that the Minister will show some contrition and introduce transitional arrangements.
Many women who have had their retirement plans shattered will be forced, through no fault of their own, to accept zero-hours contracts—temporary and low paid contracts that offer no financial security and poor return for their labour when, relatively recently, they expected to be enjoying a hard-earned retirement. Little, if any, thought has been given to the many women who care for their grandchildren or elderly relatives. It is not always possible to return to work in those circumstances and at this time in their lives.
I, my SNP colleagues and many other hon. Members of all parties agree with the reasons for the equalisation of the state pension age. However, the increased speed of the plans, with poor notice and no transition arrangements, is of great concern. The Government are betraying women and I am worried that there will be further undue hardship if they do not address the blatantly evident inequality. Not transitioning appears to be another example of the Government making cuts in pursuit of their budget surplus holy grail, with no consideration of the impact.
The Government must take some responsibility for their failure not to notify and fully prepare women for a longer wait. That means bringing forward the transitional protection and righting the injustice for those already and those set to be affected. I hope that today we will not get the same complacent ministerial reply that we heard to the recent Westminster Hall debate in which I was involved.
The Government are being warned today that the campaign will not go away. The women in the WASPI campaign will fight this all the way, and will be supported wholeheartedly by my SNP colleagues and by Labour Members. The Government need to sort the matter out with the same speed with which they delivered tax cuts for the rich when they got the opportunity, or they will forever be remembered for their betrayal of pensioners, particularly female pensioners.
It is a pleasure to take part in this Backbench Business Committee debate. I commend the hon. Member for Paisley and Renfrewshire South (Mhairi Black) for her opening remarks and pay tribute to the WASPI campaign, particularly to Marion and Anne and all the other ladies who helped campaign on this important issue. I have worked long and hard with them over the past few months. We have had meetings with my hon. Friends the Members for Worsley and Eccles South (Barbara Keeley) and for Torfaen (Nick Thomas-Symonds). I lobbied my constituents with the WASPI group in Morrisons in Denton recently and I think that I was the first in this Parliament to raise the issue at Prime Minister’s Question Time. I am therefore glad that the subject has been brought to the Floor of the House for a full debate.
A very real injustice has been done to this group of women born in the 1950s. We can go through the history again: there have been two changes to their state pension age and, if that were not bad enough, the real injustice has been the acceleration of the process, which has left many women who were not expecting the changes having to make alternative arrangements. When it came to the private pensions of Members of Parliament, those within 10 years of their normal state pension age could remain on the old scheme, but the group of women we are considering have had no chance to put in place their alternative arrangements.
Government Members have asked Opposition Members for our transitional arrangement suggestions. I made some. I gave examples from other countries: some have bridge pensions while others look after people who are made redundant. It is up to the Government, who have made the £30 billion pension grab, to come up with ideas.
My hon. Friend is right. When the Pensions Act 2011 was debated in the House of the Commons, the current Secretary of State said,
“but we will consider transitional arrangements.”—[Official Report, 20 June 2011; Vol. 530, c. 52.]
Where are they? Those ladies are still waiting. It is about time the Secretary of State came to the Dispatch Box and set out those transitional arrangements, because those women cannot wait forever.
We have already had the first U-turn from the former Pensions Minister, who said that he was not properly briefed. That says a lot about the calibre of Liberal Democrat Ministers in the former coalition Government. Now we have a Pensions Minister in the other place, who was a champion for those ladies until she took the Queen’s shilling. She now says that she cannot do anything about it. What utter nonsense. What is the point of having a Minister if she cannot do anything about it? It is time that Ministers in the Department for Work and Pensions got off their backsides and did something to help those women.
Following on from my hon. Friend the Member for Swansea East (Carolyn Harris), I will give the Minister some friendly advice. I appreciate that it is not his area of responsibility but that of the noble Lady at the other end of the building who speaks on pensions. My hon. Friend likened the WASPI ladies to wasps. Wasps can be pests and nuisances. They cannot easily be bashed away and, when that happens, they get angry and come back. If they are really annoyed, they sting and, unlike bees, they can sting more than once. Let us have some justice for these ladies; it is long overdue.
I congratulate my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black) on bringing this debate to the House through the Backbench Business Committee, and on opening it so powerfully.
From my experience of meeting my constituents at surgeries, I have learned of women affected by this cack-handed change by the Government who are living in damp housing, unable to afford the necessary housing repairs, and I have heard harrowing stories of marriages breaking up due to the financial pressures forced on them through no fault of their own.
During my research on the issue, I met WASPI and I thank them for not only meeting me and my hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown), but for their tireless work in campaigning to right this injustice. WASPI has expressed several concerns about the implementation of the 1995 and 2011 Pensions Acts, mainly, although not exclusively, about communication and timescales.
I could not agree more. I have received an email in the past hour from a constituent who turned 60 in March and was not aware of the changes and is coming to meet me tomorrow at a surgery. The problem is still going on.
My shorter contribution to the debate will centre on fairness. I believe that it is fair that both sexes will receive their state pension at the same age, but the rapid rise in the age of eligibility for the state pension has been unfair for hard-working men and women who have paid into a system all their lives in good faith.
Does my hon. Friend agree that the changes to the state pension mean that women are finding out that retirement is four, five and six years further away than they thought and that that not only leads to financial difficulties but is cruel and heartless? It happens in the context of a lifetime of low pay and inequality faced by far too many women.
I am pleased my hon. Friend has made that point for me. Given the time limit, I had to delete that section of my speech.
Hard-working men and women have paid into the system expecting, in good faith, the state to help to support their retirement. The combination of equalisation and increasing the pension age has been devastating for some women.
As I have said, WASPI has no problems with the principle of the policy; rather, it has problems with its implementation. These rapid and rushed changes have had a significant impact on a large group of women: 2.6 million women, if we accept the Department for Work and Pensions estimates. The changes have meant that some women may have to wait an additional six years to receive a state pension. From the first day of their working lives, these women have been advised to plan accordingly. At the very last minute, the Government have altered the plans that these women have had for years. This, in essence, is why the women affected feel deeply aggrieved and betrayed by the actions of subsequent Governments.
The Secretary of State for Work and Pensions, in answer to my written question on the communication of the changes to the pension age entitlement, replied that the DWP wrote to all individuals directly affected to inform them of the changes to their state pension age. However, from speaking to WASPI and local constituents this does not appear to have happened on the scale or to the degree that the Secretary of State indicated. I have spoken with women affected. They have said they received the DWP letter far too late, with only a few months’ notice of the increase in the pension age. I have also heard of letters sent to wrong addresses. In one case, unfortunately, a constituent who came to my surgery—another is coming in tomorrow—had no knowledge whatever of the changes.
It has come to light that the UK Government informed a large number of women affected only 14 years after the changes were made.
Does my hon. Friend agree that there has almost been some maladministration? I have just heard from my constituent, Susan Casey, who received a letter when she turned 50 to say that her retirement age would be in 2014. She was born in 1954. It is most unfair not only that she has been losing out, but that she has been misinformed.
Absolutely. This seems to have happened to a whole a catalogue of women. It is an absolute disgrace.
We encourage individuals to plan for the future, but if during their working lives the Government make changes to the state pension, it is only appropriate and fair that the Government communicate them adequately to allow people to re-plan financially for their retirement. I phoned one of my constituents yesterday and asked her how she would like the Government to respond to this issue. Her request was simple: she wants the Government to accept that they made a mistake with how hard and how fast the changes were introduced. That should not be a difficult concession for the Government to make, as the previous Pensions Minister himself has already accepted that mistakes were made.
It is important for the Government to learn from the mistakes they have made and to review how the changes were introduced. We need clearer channels of communication between the DWP and individuals when it comes to pensions. I hear all too often that the information the DWP sends out is confusing and unclear. I would ask that the current Government sit down with WASPI and consider ameliorating some of the financial stress that the changes have brought, and perhaps extend the timeframe.
We know the problem. We cannot sit idly by and allow cack-handed policy implementation from subsequent UK Governments to devastate the lives of so many people who have worked so hard for so long. The Government cannot shirk their obligations. They must accept responsibility, apologise and correct this as a matter of urgency. Ignorance will simply not suffice.
I just remind hon. Members that nine more people wish to catch my eye and we need to start wind-ups at a quarter past 2. If people insist on taking more interventions, as they are doing, there will be those who will not be called to speak. With that in mind, I call Philippa Whitford.
A lot of the issues have already been covered. The issue of equalisation is totally accepted, but in response to a Government Member who is no longer in his place I should say that we did point out that the life expectancy increase is not equal. In parts of Scotland we have huge differences in life expectancy, which relates to wealth, in particular. Women who are lower paid, who are unlikely to have a decent pension, who have no chance of having any other kind of pension are exactly the ones who do not get this extended life expectancy.
We also heard from a Government Member that women were definitely written to and that maybe they chose to ignore it. However, we know from FOI 3231 that the information campaign was from 2009 to 2013; in other words, 14 years later. I am sad to challenge Labour Members, but the DWP in 2004, under a Labour Government, recognised from its survey that only 46% of women knew what was coming. For most of these women it is not an extension of a year or 18 months; it is literally a change from 60 to 66.
One of my constituents from Strathaven contacted me this week to say that she had only heard about the changes through word of mouth and a web search. At 59, the Government website suggested she could retire at 62. That was then changed and put up to 64-and-a-half. The changes are unfair because they penalise people at the later stages, when they cannot make alternative arrangements.
We have heard from right across the Chamber about the lack of communication and the acceleration of the age extension, and the fact that women could do nothing about it. This is built on a generation of women who had a lifetime of poor pay. We need to think about that going forward.
Auto-enrolment does not cover the modern worker who has multiple mini-jobs, as they are called. Their combined earnings are not considered. We will therefore have another pension debate in another 30 years about the people who have been left with no pension because of current approaches to work. We know that the derived pension benefit from their husbands is not counted. We know that only 22% of women who retire this year will qualify for the full flat-rate pension. This is just unacceptable. We are talking about women who are often unemployed at 60. They are facing jobseeker’s allowance and multiple job applications. They do not qualify for free transport here in England, free prescriptions or any other benefits, such as cold weather fuel payments. For these women, this is a multiple and accelerating problem.
We have been asked by those on the Government Benches—they are now horrifically empty for such an important debate—to come up with a solution. I understand that HMRC is looking at the higher rate of pension relief, which may claw back £45 billion. That more than covers the £30 billion, which we are told would cover full transitional arrangements. High level tax relief is for the wealthiest people, those who this week, the first proper working week of the year, have already earned more than the average wage. Three-quarters of them are men. The route we should be following is to take away money that goes to people who probably, despite their long life expectancy, will not live long enough to spend it, and share it more equally with women who have been very badly treated. This is an issue of fairness and the Government have a responsibility to deal with it.
I congratulate my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black) on bringing this important issue to the House today and thank her for articulating this inequality so passionately. I am glad that Women Against State Pension Inequality is holding us to account, in spite of the problems I understand it has had in reaching some MPs.
This is a concern for millions of people across the UK, one that continues to gain momentum as the impact on women’s lives looms larger. It is important to stress that Plaid Cymru supports the principle of equalising the state pension age. I note that Lloyd George, who brought in the original state pension, represented part of my constituency.
There is no reason why a woman should be expected to retire earlier than a man. Originally, it was put in place to reflect the age at which husbands retired and the discrepancy between the ages of husbands and their wives. That is not appropriate in an age of modern equality.
I speak today in opposition not to the purpose of equalisation but to the process. The accelerated timetable simply does not give women sufficient time to prepare for retirement.
I want to concentrate on the situation in Wales. The Government claim to be making the changes in response to an increase in life expectancy, but both life experience and life expectancy vary significantly depending on which part of the UK we look at. Unfortunately, this means that Wales will be hit particularly hard by the changes. For example, a new-born baby could expect to live to the age of 87 in parts of England, but just 76 in parts of Wales. At 71.4% of the UK average, income per head in Wales is the lowest in all the UK nations and regions. The average gross salary for a Welshman is £25,200, but a woman in Wales earns on average just £20,500—a fact that this Government and the Welsh Government should be ashamed of.
I reiterate that Plaid Cymru welcomes the equal treatment of women with regard to the state pension age, but this also requires the equal treatment of women in other spheres, such as the workplace, earnings and life opportunities. The UK Government are keen to push ahead with the former as a way to cut social protection budgets, but they are doing precious little fully to secure the latter. I urge the Government to phase in the equalisation of the state pension age over a longer timeframe to give women nearing retirement adequate time to prepare. The current timeframe is too fast and will cause undue hardship. These women cannot go back and live their lives again, and they deserve better treatment from the Government. I urge them to rethink. In a case of such fundamental inequality, and given that these people vote, none of us can afford not to consider this matter in detail and to end this inequality.
I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) and my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) on introducing this important motion. The hon. Lady spoke with passion and force and characterised the problem facing many women born in the 1950s throughout Britain and Northern Ireland who are now faced with decisions they did not think they would have to make in such an accelerated fashion. Many of them are in receipt of, or have been in receipt of, low pay and undertake onerous and strenuous jobs in caring professions—for example, as nurses or home helps providing care within their own families to ageing parents. This places an additional strain on their health, yet, despite that burden, they will, because of this pensions ordeal, have to work for longer and for a smaller pension.
Women in my constituency, many of whom are associated with the WASPI campaign, which I congratulate, will be affected by these changes, because of the mirror legislation passed by the Northern Ireland Assembly. The equalisation of the state pension age is, in principle, to be welcomed, but it would be better if this symbol of gender equality was accompanied by transitional protections to ensure that women do not lose out. I recognise that, as life expectancy increases and many people stay in education longer before entering employment, the pension system must adapt. However, women in lower-paid work—home helps and carers, for example—and more physically straining jobs might not necessarily enjoy such an increase in life expectancy, yet they are the people likely to suffer most as a result of these changes, without being given adequate time to prepare.
That injustice and unfairness is the issue the Government need to address now. The previous coalition Government failed to recognise it, and instead wanted ordinary women to pay for a financial crisis they had nothing to do with. The responsibility for it should not lie at the door of women born in the early 1950s, yet they will be expected to work for longer and for a smaller pension than that which they had expected and planned for. They did not plan for this because they did not realise it was happening.
I congratulate my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black) on securing this important debate.
No one today has disagreed with the concept of equalisation. To bring the pension age for men and women into line promotes the sort of gender equality I have campaigned for, but the way the changes have been implemented amounts to an injustice for women, in the form of a faster roll-out than promised; little or no notice of changes; and no time for women to make alternate arrangements.
Absolutely. If there had been more women in the House over the years, perhaps those changes would not have taken place.
Many women expecting to start drawing their state pensions only found out in 2011 that they would face a delay. I acknowledge the hard work of WASPI and its vociferous approach to ensuring the matter is addressed. These women have experienced at first hand the consequences of the Government’s failure to provide timely and appropriate communication when implementing significant policy changes. The facts are simple: these women were not given sufficient notice. In fact, the Government did not actively inform any women for 14 years. That is simply not sufficient. The Work and Pensions Select Committee suggested 10 years, and even the Chancellor acknowledged in the spending review that 10 years’ notice must be given in the future. To me, that sounds like an admission of guilt and something the Government must address. They know they have short-changed these women and that they must take action. They must now face up to that truth.
In my time as an MP, I have been contacted by many female constituents. I was contacted by a lady from Carnwath who was born in 1956 and began working for the local council in 1978. The age of retirement impacted on her choice of career and mortgage. She could have been better prepared for her retirement had she been given adequate notice. Another constituent told me she had worked for the NHS for 42 years and had retired last May. With one year’s notice, she was informed that she would no longer receive the state pension, and she has since taken on part-time employment to fill the gap. That is simply unacceptable.
Similar themes have emerged in all my conversations with constituents: women working hard and earning less than men but still not having their contribution to society recognised by the Government. I am sure that many of my colleagues on the Women and Equalities Committee, who would have been here today had it not been for a Committee visit, would have echoed the same sentiments from the Conservative Benches. Sadly, their colleagues have failed them in that regard. I must also highlight the submissions to the Committee’s inquiry into the long-term effect of the gender pay gap and the impact of low-paid work on women.
Such sentiments are echoed throughout all constituencies across the country. There are women in every constituency who have signed the petition calling on the Government to take action. The way the changes have been implemented is unfair. The women affected have spent years paying into the system and rightly expect that to see them through their retirement. We owe it to them to make fair transitional state pension arrangements for women born in and after the 1950s. I hope the Government will heed these remarks.
I want briefly to talk about the situation of two women who have contacted me. The first was born in July 1953 and expected to retire at 60. This initially increased to 62 years and three months. She had no problem with that because she had been given plenty of notice and agreed with the gradual move towards equality of retirement age for men and women. Then, of course, with no warning, the retirement age was increased, so she now has to wait until she is 64 before she gets her higher state pension. The injustice is in the way it has been done—on a sliding scale—which means that some people in her class at school will get their pensions almost two years before her, despite their having worked for the same length of time and the same number of pension years. My constituent is still working but says she is fortunate because she has a good civil service pension. She is deeply concerned, however, that many other women rely on their state pension and now find they have to wait for many more years to get it, as discussed this afternoon.
Another constituent of mine is in that unfortunate position. She worked for 20 years as a secretary, and although the male workers in the company were automatically enrolled in the company pension scheme, women were not. It was very different for women in those days. My constituent has arthritis and is continuing to work as a cleaner because she simply cannot afford not to. She also agrees with pension reform to equalise the retirement age. That is not a problem for women; it is the way it is being done that is so very upsetting. Younger women have had to time to adjust to, and plan for, these retirement dates and the changes. Women such as my constituent, however, do not have that opportunity.
I am willing to give the Government the benefit of the doubt and say that perhaps they did not understand just how many women would be affected. I can accept that, but what I cannot get my head around is why they are refusing to look at it again. To me, this is simply callous. You know so many women are being affected; you could look again; you could listen; you could change things—[Interruption.] Apologies, Madam Deputy Speaker.
I ask the Government to look again at the people who have been disproportionately affected. They should listen to what those people are saying and get up and do something to help.
Happy new year, Madam Deputy Speaker, although the people I really hope have a happy one are the women who have been suffering under this injustice for too long.
On 20 June 2011, the Secretary of State for Work and Pensions advised MPs during a debate on the Pensions Act 2011 that he would be considering “transitional arrangements” to provide assistance to the worst-affected women, yet later that year, only completely inadequate transitional arrangements were accepted. In the same 2011 debate, the Hansard record reveals that although concern was expressed by many Members, the extent of the problems, not least the lack of effective communications, support and the transition, was not as well understood as, thanks to the WASPI ladies, it is today.
Today gives us an opportunity to begin to set the record straight and to give the Government the chance to right a wrong. Much more recently, on 24 January 2014, Ros Altmann, now the ennobled Baroness who has become the pensions Minister wrote:
“Women in their late fifties or more today have been the most disadvantaged by the UK pension system”,
and she also pointed out:
“For years, women have been the second class citizens in both state and private pensions. This particularly affects women already in their late 50s...Women…typically…earn less than men when they are working, once again leaving them with less chance to save for a pension and leaving them with lower state pensions as they lose out on the earnings-related element of the system.”
Let us recall, too, that women born in the 1950s did not have the same breadth of employment opportunity as men. In the early years of employment, it was still legal to ban women from joining private pension schemes if they married or worked part time. Women were encouraged to pay the married women’s stamp, which meant they accrued no state pension rights at all, and the state pension system did not credit them if they worked full time raising a family. In other words, the pension system was designed by men, for men.
Thousands of women are now struggling to fill the gap before they have access to their state pension, and no adequate impact assessment has been undertaken by the Government. They have simply left these women to get on with it. Some are planning to use up what savings they have, and others who may have very small private pension pots are choosing to pull them all down to help fill a gap that is the creation of this Government. The Government must act.
I want to pay tribute to the WASPI campaigning group, a group of non-political women who have come together to demonstrate and raise awareness of the serious issues involved. They had to resort to freedom-of-information requests to hold Government Departments to account, and these demonstrated the lack of communication about the Pensions Act 1995. What that group said, what we have heard today and what we hear from our constituents is how the combination of the 1995 and 2011 Pensions Acts is shattering people’s lives.
Some women have spent their whole lives planning to retire at 60 and they now find that they might have to work an extra five or six years. Nobody here can imagine the impact and the stress that this could wreak on family life. Some women have already retired on the basis that they would have enough income to get by until they reached what they thought was going to be the state pension age of 60. These include women who have been out of the workplace for up to five years and now find themselves in the position of having to find employment again. This is difficult enough when they have been out of the workplace, but it is further compounded by the austerity measures in the public sector. Some of these women had financial advisers and took early retirement, but their advisers did not tell them about the impact of the 1995 Act.
One of my constituents was made redundant from the civil service, which allowed her to care for her husband, who has now sadly passed away. Now she has discovered that she needs to get back in the workplace for a further five years. How is she going to do that at the age of 60, bearing in mind that only 34% of women in the 60 to 64 age range are economically active? Another constituent has been lucky enough to get back into work, but she feels that having to pay national insurance again while she is working these extra years rubs salt in the wounds. Another constituent, Jan Buchanan, simply says she has been robbed of over £30,000.
Another aspect of the excellent information gathered by the WASPI group is its submission and recommendations on how the Government should communicate with people in future about their pensions and how to make financial information and its impact clearer. I recommend that the Government take that on board.
We have heard that the previous Pensions Minister now admits that acceleration in 2011 was a mistake, but he has taken the easy option of blaming the civil service and the Tories. I do not think that is acceptable either. Two months ago, the Chancellor found £27 billion pounds and as we have already heard, money could be found for bombing Syria and £5 billion has already been wasted on the development of the future Trident programme.
This Government continue to tell us that they take pride in being able to take tough decisions. We will give them an open goal and an easy decision—they should change their minds on the transitional arrangements and help these people whose lives have potentially been ruined.
I am grateful for the opportunity to speak on behalf of the Democratic Unionist party, and I shall put forward a viewpoint that expresses the concerns that many Members have already raised. I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on setting the scene so passionately and in such a well-focused manner.
A large group of women born in the mid-1950s have had their entitlement to a state pension fundamentally altered by the last Government. Instead of being entitled to their state pension at 60 as they had expected and planned for during their entire life, they now do not qualify at all until the age of 66. Equalising the state pension age is a good move for gender equality in the long term, but in common with many other Members, I have been inundated with messages from constituents who are concerned that their whole life’s plans are going to be thrown up in the air by these unplanned and unexpected changes.
The Office for National Statistics has released research showing that women born in 2064 can expect to live for 100 years. That statement shows that the long-term reform of the pension age is necessary, and statistics on issues other than our ageing population also reinforce that. However, thousands of women across my constituency will be affected by these changes and the publicising of their impact has not been adequate. Thousands of women might not even be aware of these changes, which could have a drastic impact on their lives.
Margaret from my Strangford constituency wrote to me with a heartfelt plea, which I am sure echoes the views of many women across the whole of Strangford, Northern Ireland and the rest of the United Kingdom. She says:
“The stress I feel at times is awful. I thought that at this stage in my life I would have time for the ‘me’ things in life. Women my age have worked hard, we were the generation of the working wife and mother. We are, at this age, the generation of looking after grandchildren and ageing parents. We were given very little time to prepare for this extended retirement age…I feel this latest update in retirement age is unfair as all the plans I had disappeared.”
She underlines the point by saying:
“I was told several years ago that retirement age would be 62 so I had set that as a target for my future plans. Then 18 months ago I am informed that the retirement age was upped to 66. How could our own Government treat us this way?”
I ask the Minister to answer that question of how the Government could let such people down so badly.
It is important to give consideration to the fact that women who are going to be affected by these changes grew up and worked in a time when income inequality was still rife. The women affected were in the workplace in environments drastically different from today’s. They had none of the advantages young women have today in a more equal professional and working environment.
The DWP issues state pension forecasts to working-age people who had not received any type of forecast in the preceding 12 months. Despite this being issued after equalisation was agreed, the letter made no reference whatever to the changes. The opportunity to communicate the changes to affected women early and clearly has been missed, but it is not too late, even today, for the Minister to say that it is possible to make a difference, and to make the process much easier for those women. We need a coherent Government strategy, and we need it to be implemented as soon as possible to assist the women who are affected by these changes through no fault of their own.
It was a privilege to hear the hon. Member for Paisley and Renfrewshire South (Mhairi Black) move the motion, and it was an honour for me to join her in approaching the Backbench Business Committee to request the debate. There have been some powerful contributions from a number of Members who have campaigned on this issue in this and, indeed, the last Parliament.
We have heard much reference to the former Minister Steve Webb, and to what he has recently said. The question that now arises is this: if the Minister himself was subject to some misunderstanding or misapprehension—if he was in some way misled or misinformed—was the House in turn misled and misinformed in 2011, when he made various statements about impact assessments both in the Chamber and in Committee?
I often hear in the House about the principle that one Parliament cannot bind its successor. We are talking about an issue, and a choice, for this Parliament. Those who were not here in 2011 but are here now cannot wash their hands of this and say, “It is nothing to do with us.” This is a choice for us. The fact is that if the Minister was not fully aware of the facts by the time the Bill had completed its passage, other Members were not either, and the people who are directly affected by these changes certainly were not. Given that they are now so active and animated through the WASPI campaign, it is clear that if they had been aware of the facts much earlier, they would have been active much earlier.
It is insulting for Conservative Members to suggest that perhaps people had been informed and simply did not know, and if they did not know they should have known. These women have demonstrated that had they known about the position, they would have done something about it, both in terms of their personal circumstances and in terms of the public policy challenges that they would have issued. Conservative Members also came out with the nonsense that there was no alternative: that they were seeking transitional arrangements leading to pension equality, but none had been proposed. We heard from my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) about the “hard shoulder” arrangements that had been introduced in other countries. Moreover, as I pointed out in an intervention earlier, additional transitional measures were proposed during the Bill’s passage in 2011, but were voted down by the Government.
In May 2011, during a debate in Westminster Hall, I said that if the Minister did not indicate that he would revise the proposals in the Bill because the women involved were an unintended anomaly, those women would have no choice but to conclude that they had been calculated as the victims of an intentional injustice—a drive-by hit on their pension rights. That is how things stand. If we fail to pass this motion, we will be saying that those women are an acceptable casualty on the way to equality, and we cannot accept invidious treatment in the name of equality.
I warmly thank my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black) and congratulate her on securing the debate, and on making such a powerful speech about the inequalities that many women face as a result of changes in the state pension regime. I must add that, given that the debate concerns an issue that is so important to millions of women, it is an utter disgrace that a grand total of two Tory Back Benchers were in the Chamber at 2 pm, and that only half a dozen are present now, as the debate draws to a close. That shows the contempt that the Government feel for the women who are suffering as a result of the pension changes that have been foisted on them. [Interruption.] Yes, it would have been easier for them just to turn up. Where are they, and will they have the guts to stand up and vote this afternoon if we press the motion to a Division, as I expect we will?
There is no more fundamental consideration for all of us than ensuring that we can look forward to retirement, and to a retirement that offers security and dignity. We are here today because women who were born in the 1950s believe that they have been short-changed by this Government, and they are right to do so.
I should make it clear—as many of my hon. Friends have done already, along with Labour Members—that we support the principle of equalisation. It is not equalisation that is the issue; it is the speed of the journey towards equalisation that is unjust, and has led to significant and unacceptable consequences for many women whose expectation of retirement has been deferred.
The Government will tell us, as they often do, that this is all about money. To us, it is also about equity and fairness, and about doing the right thing. That is the problem with this Government. They are wedded to austerity, and wedded to reducing spending, and their obligation to society—and, specifically, to the case that women pensioners are pressing—is one that they are quite prepared to rip up and toss away: “Let us get the deficit down, and others will have to pay the price.” Austerity is not an economic necessity but a political choice, and 1950s women are paying the price of that choice. As we know, this Government know the price of everything and the value of nothing. Women’s pension rights are expendable, and the hopes of many for a decent retirement are crushed by the desire to achieve a budget surplus. We should never cease to tell the House, and the country, that there is an alternative. What we are seeing from the Government is an abrogation of responsibility. We are seeing a poverty of hope and a poverty of ambition.
No doubt the Minister will trot out the excuse that the money could not be found to create a longer transitional period, but this is all about priorities. When a Government can find £167 billion to invest in weapons of mass destruction, they can find the money to ensure that our prisoners are protected. On this issue as on so many others, this Government have a faulty moral compass.
When people enter into an arrangement with any pension provider, they are, in effect, assuming that the provider will exercise its contractual responsibilities. Whether private pensions or national insurance contributions are involved, they are effectively entering into a contractual arrangement. In this case, the state had, since 1940, been paying pensions to women who had reached the age of 60. Women had the expectation that that was what was going to happen.
The women behind the WASPI campaign are to be congratulated on the way in which they have pursued this matter. As with the issue of tax credits, on which the Government ultimately had to see sense, I expect there to be a growing clamour for the Government to do the right thing. I am glad to see that the press are already beginning to take an interest in this story. The Sunday Post in Scotland should be commended for putting it on the front page last Sunday. I understand from its Westminster editor that it has received nearly 400 e-mails this week from women affected by the changes, and I have many of them here.
Let us look at the reality of what is happening. Let us consider how sharply different will be the experiences of women born in the early 1950s. For argument’s sake, let us take the examples of women who were born on 10 February, from 1950 onwards. A woman who was born on 10 February 1950 would have retired at 60 in 2010. A woman born a year later would have had to wait almost two years longer to retire on 6 January 2012. A woman born on 10 February 1952 would have reached the state pension age yesterday, aged 61 years, 10 months and 27 days. Such a woman would have had to wait almost two more years than a woman born in 1950. As if that were not bad enough, the increases in pensionable age for women born in 1953 and 1954 become markedly worse. A woman born in 1954 will not reach pensionable age until 6 July 2019, when she will be aged 65 years, four months and 26 days. A woman born in 1955 will not retire until 10 February 2021, aged 66.
That cannot be right. It is far too steep an increase in pensionable age over a short period. I ask the few Conservative Members who are present to examine their consciences. Members of the WASPI campaign will be coming to their surgeries. Perhaps they will include a woman who was born in 1955, and who had expected to retire either now or not long into the future. Are Conservative MPs going to tell those women that it is right for them to have to wait six years longer than someone who was born five years earlier, without mitigation? That is the scale of the increase that has hit them. It is a breach of trust between the Government and women who have earned the right to a pension. Let me, as a reasonable person—as indeed we all are on these SNP Benches—help the Government out. We should also heed the recognition of the last Pensions Minister, Steve Webb, who last month admitted that the Government made a bad decision on state pension age rises. We should recall the advice from the Turner report—much quoted today—that such measures should be brought in over a 15-year period to mitigate the impact of any such changes. We have heard about the failure of communication, which it can be argued means the start of the 15-year process should be the beginning of the changes in 2010. That would mean that, as we are effectively going to be at a retirement age of 63 for women as of April this year, the Government could, for example, look at smoothing the increase in pensionable age for women aged 63 to 66 out to 2025.
My hon. Friend the Member for Paisley and Renfrewshire South mentioned at the start of her speech that pensions are incredibly complicated. My hon. Friend is also right that we have built in complexity, as well as a number of inconsistencies from the incessant tinkering that often seems at odds with other aspects of pension policy. We all ought to agree that pensions policy should be about getting things right for the longer term.
A number of positive developments have been enacted, such as auto-enrolment, but even here we need to come back and talk about how we can enhance auto-enrolment, and deal with the issue of part-time workers, for example. There are also outstanding issues on the new single-tier pension, and here again there are rightful criticisms of how this has affected many woman born in the 1950s. What I would suggest to the Government, and this is something I hope would have broad support, is that they should establish an independent pension commission that can look holistically at all these issues that require oversight.
If we accept, as we do, that there has to be equalisation of the state pension age, we also need to look at how this and the increase in the state pension age will affect people throughout the UK. We need to look at vastly different mortality rates across the UK and question how this may influence the debate on state pension age.
In conclusion, therefore, let me say the following. In Scotland a 65-year-old man today can normally expect to live until he is 82, and a woman to age 84. That is nearly two and a half years below life expectancy in England. There is therefore a considerable difference in the life experiences of people in different parts of the UK and, crucially, much less time for someone in Scotland to enjoy a secure and comfortable retirement.
We have had a debate today that has shone a light on pension inequalities that many woman born in the 1950s face. I hope the Government are listening and are prepared to reflect on what can be done to mitigate this unfairness. I would also hope they would take on board our suggestion of having an independent pension commission.
I commend the hon. Member for Paisley and Renfrewshire South (Mhairi Black) for securing and opening this debate. It is perhaps an irony, however, as we are discussing pensions, that she is further from retirement age than any other Member of this House. I also want to pay a warm tribute to WASPI on its campaign and the dignity with which it has conducted it. It is a measure of the campaign’s success that every Member of this House knows the meaning of the acronym WASPI. I also pay tribute to the other groups and individuals who have been advocating the cause of women born in the 1950s.
The level of interest in this debate is summed up by the fact that we have had 26 Back-Bench contributions from Members from all parts of the United Kingdom. I want to pick out two contributions: that of my hon. Friend the Member for Denton and Reddish (Andrew Gwynne), who has done so much work on this in recent years, and that of my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley), whose deep commitment to this is known across the House.
I also want to pay tribute to my Labour colleagues who in 2011, when the Pensions Act was going through this House, pressed the issue of transitional provisions as hard as they could. It is a shame the Government did not listen to many of our proposals set out at the time.
That points to what has happened here. In previous debates on this matter the Minister has talked about the cap on the increase being reduced from 24 to 18 months, but that was as far as it got, and we see the Government today have no positive proposals. They keep asking the Opposition about their proposals, but it is the Government whose mind has gone completely blank on this issue.
Let us not forget the fundamentals of this debate. Many women born in the 1950s will have started their working lives without even the protection of the Equal Pay Act 1970. Many of those women will have been paid at a lower rate than men for no reason other than that they were women. The gender pay gap is at its widest for many of the women under discussion today. Also, let us not forget the time that many of them took to work part-time or bring up children when they have not even had the chance to contribute to occupational pensions.
The Pensions Act 1995 increased the state pension age from 60 to 65 for women between April 2010 and 2020, to bring it into line with the state pension age for men, but the coalition Government moved the goalposts. They decided to accelerate the increase in the women’s state pension age from April 2016 so that it reached 65 by November 2018. As my right hon. Friend the Member for East Ham (Stephen Timms) has pointed out, in the Second Reading debate in this House on 20 June 2011 the Secretary of State made it absolutely clear that the Government would “consider transitional arrangements.”
The much vaunted reduction in the cap—capping the maximum increase at 18 months—that the Minister has pointed to in recent debates simply is not enough. Do the Government understand the anger at the fact that more transitional provisions have not been considered—over 100,000 signatures for a debate in this House, the online campaign and the great response to it in the media? Recently I was told by the Sunday Post that a feature on this subject brings an unprecedented response from the hundreds of thousands of women who are affected.
Let us ask ourselves what the Pensions Minister in the coalition Government at the time thinks. This is what he told the Institute for Government:
“There was one very early decision that we took about state pension ages, which we would have done differently if we’d been properly briefed, and we weren’t.”
“We made a choice, and the implications of what we were doing suddenly, about two or three months later, it became clear that they were very different from what we thought.”
He then said:
“So basically we made a bad decision. We realised too late. It had just gone too far by then.”
I am honoured to be put right by that intervention, and perhaps the Professor, as we shall forever refer to him, would have been better off listening to my colleagues on the Labour Benches than the civil servants.
It would be even more interesting to ask ourselves what the current Pensions Minister thinks of the 2011 Act. I thoroughly recommend to the House rosaltmann.com, which has a lot of wonderful critiques of the coalition pensions policy in it. She cannot deny it is her site; her photograph is on every contribution. She said this about the 2011 Act:
“The Government has decided to renege on its Coalition Agreement, by increasing the State Pension Age for women from 2016, even though it assured these women that it would not start raising the pension age again before 2020.”
That is what the current Minister for Pensions said. Even after the concession of the cap being reduced, this is what she said to the Yorkshire Post on 6 June 2013:
“The coalition seems oblivious to the problems faced by those already in their late fifties, particularly women, who feel they simply do not matter to policymakers.”
What an appropriate critique that is!
We should also look carefully at the intervention from my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson) who talked about being lobbied by the Pensions Minister about applying the pensions protection fund retrospectively. Her lobbying of my right hon. Friend was effective on that occasion. She told him that the impossible was possible. Now, however, she says that what we are trying to achieve is impossible. I have an interest in history, and I have been trying—unsuccessfully—all morning to think of an example of another Minister who had more influence on Government policy when they were outside the Government than when they were in it.
We have heard much about the key question of notice. It is key because the Government have in their gift the pensions legal framework in this country, and when they make changes to it, they have a duty to provide notice of them. The House should not just take my word for that; let us take the word of the Pensions Minister. What did she say about women who were already in their late 50s and about the notice they were given under the 2011 Act? She said:
“They are not being given enough notice of such a huge change.”
Why will she not listen to her own words now?
This debate is taking place against the backdrop of a decision in the district court in the northern Netherlands, which has already been mentioned today. It found that a lady who suffered from a number of chronic, progressive diseases faced a disproportionate burden in bridging the gap to her extended retirement age. How awful it would be if this battle were to end up in the courts, given that the Government have the chance to do something about it today. The Government keep saying that they are not sure what to do. They find it impossible to do anything about this, and they have no proposals to bring forward. Yet if we look at the passage of the Pensions Act 2011, we can see that they had a number of options at that time, one of which has been set out by my hon. Friend the Member for Foyle (Mark Durkan) today. Another, which was put forward by one of my predecessors as shadow Pensions Minister, related to maintaining the qualifying age for pension credit on the 1995 timetable rather than the 2011 one, which would at least have provided a buffer for those who were least able to cope financially with the changes. That proposal was completely dismissed at the time.
I ask the Minister at least to open his mind to having a discussion about what might be done, instead of consistently hiding behind the fact that he is going to do absolutely nothing. We have today heard the passion around this issue, and it is not an issue that is going to go away. I urge the Government to be constructive. They could still do something to ease the transitions. Whatever the Minister does today, he should not slam the door in the face of the 1950s women.
I congratulate the hon. Member for Paisley and Renfrewshire South (Mhairi Black) on managing to secure this debate, which has attracted many Members on both sides of the House. I also commend all the colleagues who have taken the trouble to come here and speak today. I will try to address as many of their points as I can in the limited time available to me.
I should like to begin by reminding the House of the rationale for reforming the timetable. For our state pension system to function effectively, it has to be fair, affordable and sustainable. The changes made to the state pension age under the Pensions Act 2011 make an important contribution to achieving those aims. Gender equality is one of the main purposes of the changes to the state pension age. Under the previous system, women reaching state pension age in 2010 would spend on average 41% of their adult lives in receipt of the state pension. For men, the figure was only 31%, owing to the longer life expectancy and earlier state pension age of women.
It makes little sense for women to work to a pension age originally set in 1940 which does not reflect the employment opportunities open to them in a modern society. Changes were needed to take account of increased life expectancy and to ensure fairness for working-age people who would otherwise bear the cost of this longevity. Following sharp rises in life expectancy, the previous Government acted to address this and brought forward the timetable for rises in the state pension age. This was vital if we were to continue to meet the UK’s obligations under EU law to eliminate gender inequalities in social security provision and to ensure that the state pension remained affordable and sustainable. It is also important to look at the changes in the context of our wider pension reforms and what these mean for women.
The Minister cannot have been listening to what I said earlier. A substantial proportion of what I said showed that that is not the case, although he and his colleagues are hiding behind that argument. We were not required to do that. Some EU countries are not equalising until 2040 or 2044, and some are maintaining a difference. Will he please stop hiding behind something that is not true?
I will not give way. I am mindful of the limited time that I have, and I am keen to ensure that the proposer of the motion, the hon. Member for Paisley and Renfrewshire South, has time to make her concluding comments at the end of the debate.
The introduction of the new state pension will benefit many women who would have lost out under the current two-tier system, largely as a result of lower average earnings and part-time working. All those affected by the 2011 changes will reach pension age after the introduction of the new state pension. Around 650,000 women reaching state pension age in the first 10 years will receive an average of £8 per week more under the new state pension than they would have done under the previous system. The majority of households reaching state pension age up to 2030 will receive a higher total income over retirement under the new system.
The solution to ensuring that people have a comfortable later life is encouraging and enabling them to work longer. This benefits individuals through the social and financial rewards of employment, it benefits employers through the skills and experiences that older workers bring to the workplace, and it benefits the wider economy. Research by the National Institute of Economic and Social Research has shown that adding just one year to people’s working lives would add 1% to UK GDP per year.
Support is in place to provide extra help for people who cannot work owing to caring responsibilities, ill health or disability. Women affected would be eligible for the same in-work, out-of-work or disability benefits as men of their age, and carer’s allowance may be available, for which national insurance credits are awarded automatically. In 2011, credits were introduced to help adult family members looking after a child under 12 in order to assist the parents who were working, with these credits being able to count towards state pension entitlements.
Much has been made of the comments made by the previous Pensions Minister, Steve Webb, and it is important to recognise that even he was not seeking a restoration that would cost £30 billion. Indeed, he said that he was only looking for a 10% clawback. It is also worth remembering that he does recognise that the £1.1 billion concession that was made was generous. His exact words were:
“and we got £1 billion back in the end, and a billion quid is a serious amount of money.”
I am grateful to the Minister for being so generous in giving way. He read out the quote about £1 billion being a “serious amount of money”, but he really should have quoted the whole sentence, which begins:
“this was a measure to save 30 billion quid over how many years, and we wanted 10% of that back to soften the blow”.
Steve Webb wanted £3 billion back but got only £1 billion.
If the hon. Gentleman had taken the trouble to listen while he was preparing his question, he would know that that is what I said, except that I used different words. He might want to check the Hansard record tomorrow morning. In this place, it always helps to listen before speaking.
The Government listened to the concerns expressed during the passing of the 2011 Act, and shortened the delay that anyone would experience in claiming their state pension, relative to the 1995 timetable, to 18 months. That concession benefited almost a quarter of a million women, who would otherwise have experienced delays of up to two years. A similar number of men also benefited from a reduced increase. The concession was worth £1.1 billion in total, and as a result 81% of women affected will experience a delay of 12 months or less.
To me, the concessions that were given show that the Government recognise that the transition was not appropriate. Given that the wording of today’s motion is clear in asking the Government to reassess the transitional arrangements, will the Minister confirm that he will do so if the motion is passed, be it unanimously or with a vote—yes or no?
I have only a short time left and I must press on.
As for people being aware of the 1995 changes, I should add that research carried out in 2004 by the Department for Work and Pensions found that 73% of people aged 45 to 54 were aware of the changes to women’s state pension age. It is regrettable that people have sought to put this on a political basis and have conveniently forgotten that after 1995 we had 13 years of Labour government. I have here a list of some 10 Labour Pensions Ministers who totally failed to do anything, yet Labour Members conveniently seek to put the blame on the things that have happened post-2010. The shadow Home Secretary made comments earlier, but he was a Labour Cabinet Minister, and the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson), who also made comments today, was also in the Labour Administration. He is a former Pensions Minister, yet he did nothing then.
The right hon. Gentleman spoke earlier of being lobbied, but he took no action on that. Furthermore, big issues arise as to whether notice was given in respect of the changes in 1995, and when he was Work and Pensions Secretary he did nothing to make sure that those women were informed. All the blame has been put on Conservative Members.
I wind up simply by saying that this matter was debated thoroughly and properly in 2011. A concession was made then—by way of time period and financially—which was worth more than £1 billion, and it was thoroughly debated in both Houses of Parliament. I very much hope that I have put the Government’s position on the record. I simply say to some people that they, too, should learn to take responsibility, given that they were in government for 13 years. With that, I shall allow time for the hon. Member for Paisley and Renfrewshire South to speak.