Women’s State Pension Age: Ombudsman Report
Alan Brown Excerpts(2 weeks, 2 days ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
It is a pleasure to follow the hon. Member for Strangford (Jim Shannon). Like everybody else, I commend my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) for securing this debate, and for all the work she has done in speaking up for 3.8 million affected women for all these years. I also commend all the other Members who have spoken in today’s debate; there have been powerful speeches, and powerful but harrowing stories of how various constituents have been affected by the increases in the state pension age for women.
There is a Back-Bench consensus today that the Government have dragged their heels, that a response is now long overdue, and that compensation is due. We have also disproved the nonsense that women should have known about the increases in their state pension age. Financial advisers and lawyers did not even know: as my hon. Friend the Member for Livingston (Hannah Bardell) said, divorces were granted on the basis of women accessing their pensions at the age of 60.
Some Labour Back Benchers today have rightly criticised the Government for their lack of action and for their policies elsewhere, but then somehow bristled at SNP speakers calling out the silence of their own Front Benchers. We are willing to work cross-party, but we also need pressure for action. If we do not call out what we think is wrongdoing, we are not doing the right thing for the WASPI women who we are all here to represent today.
We would not be in this Chamber today, debating this issue as parliamentarians, if not for fantastic campaigners such as Ayrshire WASPI Group, Cunninghame WASPI Group, WASPI in my constituency, WASPI Scotland, and of course the wider WASPI organisation. I pay tribute to my constituent Ann Hammell, who brought the issue to my attention in my early period as an MP in 2015. Again, it was heartening to hear so many MPs commend their own local campaigners.
Turning to the ombudsman’s report, there are a few key aspects: the findings and confirmation of maladministration in the DWP, compensation to be paid, and Government failures. I will explore each in turn. The ombudsman has not only confirmed that it believes that the DWP is guilty of maladministration, but has expressed outright anger at the belligerence of the Department and, by default, this Tory Government. I welcome the robust comments of the ombudsman’s chief executive, Rebecca Hilsenrath, who has stated:
“The UK’s national Ombudsman has made a finding of failings by DWP in this case and has ruled that the women affected are owed compensation. DWP has clearly indicated that it will refuse to comply. This is unacceptable.”
I agree with her.
It beggars belief that, in 2024, the Government are suddenly pretending that this ombudsman’s report is a bolt out of the blue and very complex. It is three years since the ombudsman found that the DWP was guilty of maladministration because of its lack of communication about increasing the state pension age. It is scandalous that the ombudsman is actually having to ask Parliament to find a way to create a mechanism to provide compensation for those affected. If the ombudsman does not trust the UK Government to do the right thing, I do not trust them either.
Unfortunately, at the moment I also do not trust the official Opposition, who have been too quiet on the report findings to date. That is why I have brought forward my private Member’s Bill, the State Pension Age (Compensation) Bill, which sets out a compensation framework. We need to remember that the Prime Minister was the Chancellor who boasted about setting up the furlough scheme in a couple of weeks for the covid lockdown. Clearly, if there is a Government will, there is a way, so why do the Government not have the will to get on with a compensation scheme for the WASPI women?
In the ombudsman’s report, compensation is unfortunately set at just level 4, which feels wrong. For the majority of the 3.8 million women affected, it feels like a smack in the face. Compensation of between £1,000 and £2,950 is an inadequate maximum payout. The WASPI APPG recommended level 6 for the worst affected, and my private Member’s Bill takes a similar approach. I have suggested a framework that follows the clear logic that those affected by the biggest increase in state pension age, while in effect having the shortest notice period, should receive the most compensation.
As for the 2.5 million women who have had to wait five years or more to access their pension, it would be absurd to award them just level 4 compensation of less than £3,000. In my framework, they would be allocated compensation at PHSO level 6, which is about £10,000. Those who have not had to wait quite as long, but who were still badly affected in some cases, will get levels 4 and 5, with a minority on lower levels. I thank Members from across the House who have signed my private Member’s Bill.
This subject has been debated in Parliament for nine years, and for over nine years these women and their families have been fighting for justice. It is tragic that, as has been repeated many times, the women are dying at a rate of 40,000 a year, or one WASPI woman every 13 minutes, and they are not getting the justice they deserve. This underlines that it is critical that Parliament takes action now.
However, there has not even been a suggestion on the way forward from the official Opposition. They should be putting proposals to the Government, and saying what they would do if they were in government. If their solution was accepted by the Government, they could then claim credit for getting compensation over the line. Instead, we have heard nothing from the Opposition—zip—apart from weasel words about listening. I hope the shadow Minister, the hon. Member for Wirral South (Alison McGovern), will change my mind and offer proposals during her summing up, but there was a bad example last week in the Scottish Parliament, when Labour MPs sat on their hands when it came to voting for compensation for the WASPI women. They had the temerity to get photographs taken with the campaigners, and to tell them that they backed them, but then they went into the Chamber in Holyrood, sat on their hands and actively abstained, which was disgraceful.
As I say, I hope the shadow Minister will bring forward proposals, but I would like her and the Minister responding to the debate to consider the constituents’ stories we have heard today, and a few of mine as well. Lynn was exhausted after working for 34 years in the NHS and agreed to take early retirement at 55, but she found out on her last day of work that it would be 11 years before she got the state pension, not the five years she anticipated. Nancy was widowed at the age of 54, while she was working part time, which was clearly traumatic emotionally and financially. She has suffered umpteen chronic health conditions while caring for her parents, but was forced to take NHS bank work just to survive.
Lesley, who has sometimes worked three jobs to make ends meet, was a carer for her partner when he had cancer, a carer for her dad when he had cancer, and had a period of travelling to Southampton every weekend to visit her aunt—superwoman efforts that would exhaust anybody. It is little wonder that she took early retirement age 56, only to discover later that she had to wait six years longer than she thought to access her pension.
Do not dare tell those women and others like them that they need to wait longer for justice. These are women who did not have maternity rights back in the day. They were paid less than men, and were more likely to work part time, and their private pensions were smaller, if they had them. In reality, pension age equalisation has further disadvantaged those women, especially as they were told that to get a full pension, they had to pay extra NI contributions. It is time that the right thing was done, and that right thing is fair and fast compensation now.
Paul Maynard
If I may, I will answer that in a moment, because I will now turn back to the report. In laying the report before Parliament, the ombudsman brought matters to the House’s attention, making it clear that Parliament has a role in responding to the report. The Government intend to engage fully and constructively with Parliament. I view this debate as a crucial part of that process.
I remind the House about what the ombudsman’s report says—and indeed does not say. The ombudsman has looked not at the decision to equalise the state pension age but rather at how that decision was communicated by the DWP. That is important to understand, as the motion calls on the Government to
“deliver prompt compensation to women born in the 1950s who had their State Pension age raised.”
Importantly, the ombudsman’s report hinted at the Department’s decisions over a narrow period between 2005 and 2007, and their effect on individual notifications. The ombudsman has not found that women have directly lost out financially as a result DWP actions. The report stated:
“We do not find that it”—
the DWP’s communication—
“resulted in them suffering direct financial loss.”
The final report does not say that all women born in the 1950s will have been adversely impacted, as many women were aware that the state pension age had changed. The stage 1 report found that between 1995 and 2004, the DWP’s communication of changes to the state pension age reflected the standards that the ombudsman would expect it to meet. That report also confirmed that accurate information about changes to the state pension age was publicly available in leaflets, through the DWP pension education campaigns and DWP agencies and on its website. However, when considering the Department’s actions between August 2005 and December 2007, the ombudsman came to the view that they resulted in 1950s-born women receiving individual notice later than they might have done had different decisions been made.
I welcome the wide-ranging contributions from Members on behalf of their constituents.
Alan Brown
The ombudsman clearly said that the DWP was guilty of maladministration during the period of 2005 to 2007. Does the Minister accept the finding that the DWP was guilty of maladministration, and should put its hands up to that?
Paul Maynard
I recognise that there will be an appetite from some Opposition Members for the Government to respond item by item to different parts of the ombudsman’s report, but the Government wish to respond in full when they have reached a conclusion from their deliberations. I will not go down the path that the hon. Gentleman seeks to take me along.
Some of the detailed commentary from Members today illustrates the interlocking considerations at play, depending on how each Member of Parliament responds to the report. The fact that so many have spoken today demonstrates the importance of this issue. Many parliamentary activities are worth noting to understand how they fit in. The Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Sir Stephen Timms), mentioned the evidence session held last week and the recommendation that he has made to the Department, which I read after he mentioned it, so I have only just seen it.
Late last month I was able to meet the hon. Member for Salford and Eccles (Rebecca Long Bailey) and my hon. Friend the Member for Waveney (Peter Aldous), the chair and co-chair of the all-party parliamentary group, to discuss our initial views of the report and what steps they intended to pursue to take further evidence. I am looking forward to seeing what they have to say. I have noted the evidence given last week to the Select Committee. I also took careful note of what occurred in the Scottish Parliament. The many views expressed so far provide valuable input to the ongoing deliberations.
Let me come to the question from the hon. Member for North East Fife (Wendy Chamberlain) about the written answer she received. I will take my glasses off to read this, because the print is very small and not clear: in November 2023, alongside other interested parties, the DWP received a copy of the PHSO’s revised provisional views on injustice, which was stage two of the inquiry, and remedies, which were stage three, for comment. The DWP responded with its comments in January 2024. The Department was notified by the PHSO on 19 March that the final report would be received on 21 March 2024, at a meeting between the permanent secretary and the ombudsman. I note that the hon. Lady’s written question was about the final report as opposed to the preliminary report.
State Pension Changes: Women
Alan Brown Excerpts(2 months, 3 weeks ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
Like everybody else, I thank the hon. Member for Strangford (Jim Shannon) for bringing this debate forward, and also for sponsoring my private Member’s Bill—the State Pension Age (Compensation) Bill—which is aimed at compelling the UK Government to bring forward a compensation framework for the 3.8 million women affected by the state pension increase without proper notification, including 13,000 in my constituency.
Given that the ombudsman concluded at stage 1 in July 2021 that the DWP was guilty of maladministration, we in this place should not be having to force this issue. Would it not have been comforting to see, for once, our Government care to step in and do the right thing by way of remedying an injustice? Of course, as have others said, as with the infected blood scandal, the postmasters scandal and the green deal mis-selling, they do nothing and hope the issue just goes away. They have ignored this issue for nine years, but at least it still has not gone away, even if too many politicians have already given up for my liking.
We are talking about women who did not have maternity rights back in the day, who were paid less than men, who were more likely to work part time, and whose private pensions, if they had them, were smaller than men’s. In reality, the pension age equalisation was a further prejudice against these women, especially the many who had already retired before they got the bombshell notification that they needed to wait six years before they could access their state pension.
They then found out that the number of national insurance-contributing years required to receive the full pension had been increased, so many did not even have the opportunity to contribute enough NI to receive the full pension. That is another double whammy for these women. It really is time that the Government accepted the WASPI call for fair and fast compensation—for money that can be paid out to these women. That money will eventually be clawed back for the Government in taxes anyway, but it will also provide a local spending boost.
We also need to hear today from the Labour Front-Bench team what their position is. For too long, they have been quiet on this topic. For too long, we keep hearing that Labour is going to stick to Tory spending plans, which means austerity 2.0, including £19 billion of future departmental cuts. I hope that the Labour Front-Bench team commit to providing fair and fast compensation for the WASPI women if the Government do not step up to the plate. Let us not be kidded: we cannot have any faith in this fag-end Government stepping up to the plate.
When I presented my ten-minute rule Bill, I put a number of personal testimonies on the record. I hope the Minister will look at some of them, because they show what life is like for many people affected by the state pension increase. Unfortunately, I do not have time to go through those testimonies right now, but they talk about people losing their homes, being dependent on partners, being forced to try to get back into work, struggling on benefits to get by, and struggling on small private pensions because they did not have enough money or enough warning from the Government. Yet again, I say, pay that compensation and step up to the plate.
Gill Furniss
However, I can say that I have been meeting the WASPI women regularly since I took this role just a few months ago. I am honoured to be in what I believe is a friendly and honest dialogue with them, and I will continue to do that throughout the coming months and beyond, should I be in the same position.
Alan Brown
If the hon. Member’s dialogue is a friendly and honest one, she should be able to say whether the Labour party agrees with the principle of compensation for the WASPI women.
Gill Furniss
I believe I have already answered that. I am not here to announce our manifesto. I am here to debate like those who have already and I am here to listen, but I cannot announce our manifesto.
The Parliamentary Under-Secretary of State for Work and Pensions (Paul Maynard)
It is a pleasure to serve under your chairmanship, Sir Gary. I thank the hon. Member for Strangford (Jim Shannon) for securing this debate and all Members who have contributed to it.
This has been a valuable and constructive debate focused on the issues of compensation for 1950s-born women affected by state pension age changes. I recognise that there is a huge strength of feeling among 1950s-born women about the increase to their state pension age and the way in which it was communicated. We have heard today about people who have had difficult personal circumstances to manage, and their struggles are regrettable in the extreme. I am grateful to all Members who have participated. It is important that Members on all sides are able to tell the stories of so many of their own constituents. Indeed, I pay tribute to many of my own constituents whom I have sat with and listened to on a number of occasions as they explained their circumstances. It is important that such testimony is uppermost not just in my mind as the Minister, but in the mind of Government more widely.
I note that the Member in charge of the debate, the hon. Member for Strangford, is a Northern Ireland MP. For the record, I will set out how Northern Ireland manages its own system for dealing with complaints such as this; as he will know, such matters are for the Northern Ireland Public Services Ombudsman to address. Any question relating to Northern Ireland must be directed to the relevant authorities in Northern Ireland. All DWP policy areas are transferred in Northern Ireland, including pensions. However, the equivalent Department in Northern Ireland, the Department for Communities, historically has maintained parity with the DWP on matters of social security, child maintenance and pensions.
As House is aware, the Parliamentary and Health Service Ombudsman’s investigation into state pension age communication is not complete. The date of publication is a matter for the ombudsman. As the investigation remains ongoing, I cannot comment on it, as the ombudsman’s investigations are confidential. The privacy rules extend to all parties involved in the investigation.
Alan Brown
The Minister is right about probity and the fact that the ombudsman’s investigations are to remain quiet. Does he accept that after stage 1 it is still in the Government’s hands to bring forward compensation? They do not have to wait until the conclusion of further stages.
Paul Maynard
I will come on to the sequencing and the importance of the different stages shortly, but I am reminded that the Parliamentary Commissioner Act 1967 states that ombudsman investigations that are not complete
“shall be conducted in private”.
The ombudsman has made some information about the investigation public via its website. It published the final version of stage 1 of its report on the website in July 2021. The report said that
“these women should have had at least 28 months’ more individual notice of the changes than they got.”
These findings relate to a specific window of time between August 2005 and December 2007. The report also found that
“between 1995 and 2004, DWP’s communication of changes to State Pension age reflected the standards we would expect it to meet.”
I know that there is frustration among Members of this House and their constituents about how long the investigation has been ongoing, and about the fact that the ombudsman has yet to publish his final report. It is a complex investigation that spans over 30 years, as equalisation of the state pension age was enacted in 1995. The ombudsman provides an independent complaint handling service for complaints that have not been resolved by UK Government Departments and the NHS in England. The ombudsman is managing the investigation in stages, and publication of the final report is entirely a matter for the ombudsman.
Oral Answers to Questions
Alan Brown Excerpts(6 months, 3 weeks ago)
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Guy Opperman
It is good to welcome the hon. Lady to the Dispatch Box; I have not previously had the chance to answer her questions. We have undertaken TV campaigns, internet campaigns and campaigns on the radio, in print and on social media—the great Len Goodman assisted us in that regard before his passing—so there is fantastic support across all aspects. The hon. Lady should be aware that pension credit applications were up 75% in the year to May, and we have never had so many people as we are now seeking to encourage to apply. Absolutely, the Government are fully behind the pension credit campaign.
Alan Brown (Kilmarnock and Loudoun) (SNP)
The Minister for Disabled People, Health and Work (Tom Pursglove)
The Department has developed estimates of the number of claimants impacted by options considered in the work capability assessment consultation. Estimates are not based on specific conditions, because the work capability assessment is based on how a person’s condition affects them, not the condition itself.
Alan Brown
The proposed changes to the work capability assessment could actually see half a million people forced to look for work they are not cut out for and then at risk of sanctions. The proposed changes on continence, mobility and social engagement are putting thousands of Parkinson’s sufferers at risk of being denied the benefits they need, causing needless stress and financial pressures. Will the Secretary of State meet me and Parkinson’s UK to discuss the impacts on those suffering from Parkinson’s? Hopefully the Government will then change their mind on these cruel proposals.
Tom Pursglove
What I can say to the hon. Gentleman is that no decisions have been made. It is right and proper that the consultation responses are properly considered in the normal way. I would be happy to meet with Parkinson’s UK again; I met it previously, and it is an important stakeholder for the Department. We do think it is right that we look at the work capability assessment and review it periodically, not least because of the changes we have seen in homeworking and flexible working in recent years.
State Pension Age: Review
Alan Brown Excerpts(1 year, 2 months ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
I thank the Secretary of State for advance sight of his statement. The Work and Pensions Committee called on the Government to publish the reports by Baroness Neville-Rolfe and the Government Actuary, which have been used to inform the review of the state pension age, and it is regrettable that that did not happen in good time. I am sure that many of us are left wondering why the Government did not publish those reports earlier to allow proper parliamentary scrutiny and a more informed decision. Is it not the case that this is a political decision because this Government, who are at the end of their days, do not want another fight before the next general election?
We in the SNP oppose further increases to the state pension age. We are glad that life expectancy is now finally being factored into the wider consideration of what is an appropriate state pension. The reality is that Tory austerity, followed by covid, has caused an overall reduction in average life expectancy figures. The UK has one of the worst state pensions in western Europe; too many pensioners in Scotland live in poverty, which is a damning indictment in what is supposed to be the sixth largest economy on the planet. Is the Secretary of State not embarrassed that pensioners on these islands have to choose between heating and eating in 21st century Britain? He talks about a reduction in poverty rates, but that is because the Government are using lagged data to analyse poverty rates and ignoring the cost of living crisis that is on us now. With 7 million households in fuel poverty, the Government cannot talk about poverty rates decreasing.
There is evidence that increasing the state pension age from 65 to 66 caused absolute poverty rates to rise. Has the Secretary of State seen the Institute for Fiscal Studies report on that and, if so, has it been part of the decision-making process? What lessons has he learned from the Women Against State Pension Inequality Campaign about raising the state pension age for women born in the ’50s? When will they see some compensation?
Finally, we look forward to an independent Scotland being the best place to grow old in prosperity, not in poverty with a Westminster Government we did not vote for.
Mel Stride
The hon. Gentleman raises several points. First, on the publication of Baroness Neville-Rolfe’s report, I have always been clear that we would publish that at or around the time that my report of the review was released, and that is precisely what we have done, including by giving advance sight of my report and her report to the Opposition.
I believe that the hon. Gentleman’s remarks about pensioner poverty are misplaced. Pensioner poverty has fallen since 2009-10, as has poverty across other cohorts of the economy. He will, of course, be aware of the huge amount that this Government have been doing by way of intervention to ensure that we support low-income households, and pensioners up and down this country—many millions of them—with billions of pounds of targeted transfer payments, which will be going out over the coming months.
Finally, the hon. Gentleman mentioned the WASPI women. He will know that I am not able to comment on that matter as it is subject to a current inquiry by the parliamentary ombudsman.
State Pension Triple Lock
Alan Brown Excerpts(1 year, 6 months ago)
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Jonathan Ashworth
My hon. Friend has described with great eloquence the real-life impact that this cut will have on our constituents. Although I do not know the particular circumstances of the family she refers to, they may well be reliant on other social security payments, and we have no clarity from the Government about whether they will also be cut in real terms.
Alan Brown (Kilmarnock and Loudoun) (SNP)
Does the right hon. Gentleman agree that those other social security payments also need to be uprated in line with inflation? If so, should Labour not have made the motion wider to include that?
Jonathan Ashworth
Today’s debate is about the triple lock, but we do agree that payments such as universal credit should be uprated in line with inflation and not suffer a real-terms cut.
Mel Stride
My hon. Friend is entirely right. That is precisely the point I am making. It would be entirely irresponsible for any member of the Government to prejudge or give a running commentary on anything that may appear in that statement.
Alan Brown
Can the Secretary of State outline why it would be irresponsible to confirm that the Government are keeping a manifesto commitment and promise?
Mel Stride
As I have set out, we are facing what is being called a Budget. It is a major fiscal event and many decisions will be taken within it. It would not be right for a member of the Government at the Dispatch Box to prejudge what may be included in it.
Mel Stride
The hon. Lady asks from a sedentary position why poverty is going up, and I will come to poverty in a moment. There is no doubt that my hon. Friend the Member for Gloucester is right: for a long time the Government have stood up for the interest of pensioners as one of our prime priorities, and we know why. Many pensioners are particularly vulnerable. When economic conditions are difficult—as they are at the moment—it is hard for them to adjust their economic circumstances, to re-engage with the workforce and so on, so it is important that we have that duty.
I turn to poverty. Since 2009-10, 400,000 fewer pensioners are in absolute poverty—before or after housing costs—and the proportion of pensioners in material deprivation has fallen from 10% in 2009-10 to 6% in 2019-20. Over the much longer sweep since 1990, relative poverty has halved, but there is still more to be done.
Alan Brown
Does the Secretary of State accept that poverty analysis figures lag real time and that poverty figures are going up? We only have to look at how an estimated 6.7 million households are in fuel poverty. Will he remember that when he stands at the Dispatch Box and talks about figures coming down?
Mel Stride
Those figures are simple facts about what has happened to absolute poverty across the period that I quoted.
I turn to an important issue: the economic circumstances in which the country finds itself.
Mel Stride
Mr Speaker, you are a man after my own heart. We are on the same page and I could not agree with you more. Thank you very much indeed for that timely intervention.
That brings me to my closing remarks.
Mel Stride
I will not.
I respect the fact that the right hon. Member for Leicester South brought forward the motion and, to the extent that it underlines the absolute importance of standing up for our pensioners, I welcome it. Government Members will always be there to support pensioners. We always have been in the past, we are now and we always will be.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I will pick up some of the Secretary of State’s comments. He started off by trying to claim that there was not much illumination from the shadow Secretary of State’s speech, but we got absolutely no illumination from his speech, either. There is still no clarity on what the Government are going to do. As I said, it is just not adequate to say, “It’s irresponsible to come forward and provide clarity on what is going to happen on the triple lock.” The Secretary of State kept talking about being honest with the public, so he should be honest and tell us what will happen with the triple lock.
The Secretary of State attacked Labour with the old trope about Labour doing borrowing. I am sure that, not that long ago, he was backing the mini-Budget that was all about borrowing to give tax cuts to the rich. That was economic madness. Does he want to come back to the Dispatch Box and apologise for that?
I am happy to support the motion. It is simple and, as it references the Tory manifesto, it should win the entire House’s support—hopefully without the chaos that we witnessed in the Opposition day debate about fracking. I note that that was also the day when the former Prime Minister was questioned at the Dispatch Box by my right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford); she did her 55th U-turn and said that she would protect the triple lock, so it should be easy for the Government to further confirm that, rather than holding on to the line about waiting until next week.
Last year’s breaking of the triple lock cost each pensioner £520 on average during the cost of living crisis, and the Red Book shows that it will take £30 billion in total from pensioners by 2026-27. At least uprating the state pension this year in line with September’s 10% inflation rate would give certainty of income to its recipients.
However, we should also look at the reality. If the triple lock is reinstated and pensions are uplifted, we are actually almost celebrating not cutting pensions in real terms in the Budget. That is how desperate things are. If that is the measure of compassionate conservativism—not making further cuts to pensions—then it shows the reality of where we are with this Government.
In terms of inflation in the here and now, we know from the Office for National Statistics that tea is up 46%, pasta is up 60% and bread is up 38%. The price of budget food in supermarkets is up an astonishing 17% in the year to September. On energy costs, the average bill, based on the previous cap, was £1,100 a year just a year and a half ago. Now, with the so-called energy guarantee, we are supposed to be pleased that bills are now, on average, £2,500 per year during the winter period.
For the Energy Prices Act 2022, the Government’s own figures estimated that energy bills would go up on average to £4,400 without the support package. That is almost 50% of an average state pension. Given that it is perfectly obvious that pensioners are more likely to use more energy than an average household, it is not just the triple lock that needs to be reinstated; we need this Government to come forward with confirmation of what the future energy support package will be for those who need it. The Secretary of State talked about protecting the most vulnerable. Well, they need to know what is happening with energy going forward as well.
In Scotland, average usage already means that bills are in the order of £3,300 per annum even with the current energy support package, so for people on fixed incomes it really is unaffordable.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
I am grateful to my hon. Friend, who is telling it like it is for people in their homes just now. He is talking about energy costs. That does not include those people, including pensioners, who live off the gas grid and are therefore paying far, far more than those he is quoting.
Alan Brown
I agree wholeheartedly with my hon. Friend. The £100 payment to those off gas grid is almost an insult, because it does nothing to help them fill their oil tanks.
In a similar vein on inflation, petrol prices are still massively up compared with recent years. I drive an Insignia, which is not a huge car, but last week it still cost me over £100 to fill the petrol tank. That is clearly unaffordable for those on a fixed income, and it would account for 55% of one week’s full pension.
When we look at the UK in the round, we see that it is one of the most unequal countries in the world. Unfortunately, that inequality continues during retirement. The Gini coefficient shows that the UK is 14th out of 14 north-west European countries. It is the same for the S80:S20 quintile share ratio; when we compare the ratio of the poorest to the richest, the UK has by far the worst ratio and is again 14th out of 14. Scandinavian countries—all small, independent countries—lead the way on these measures.
Poorer pay and lower incomes for those struggling also means that later on in life they are less likely to have private pensions and so are reliant on the UK state pension. Again, the UK state pension fails in comparison with those of other countries. When we look at the proportion of earnings derived from state pensions, the UK sits 30th out of 37 OECD countries. I understand that there is an argument that it can be good to move away from dependence on state pensions, but the UK is clearly among outlier countries near the bottom of the pile, and way below the OECD average. Many people are using occupational pensions and capital as sources of income, but that increases inequality in pension age for those without access to such means.
If we look at the UK’s flat pension rate and compare it with other countries that pay a flat rate—Ireland, Denmark and the Netherlands—we see that the UK rate is again lower and fails in comparison. If we look at state pension expenditure compared to a country’s GDP, we see that the UK is again way below the OECD average and is ranked 28th out of 38 countries. Ministers might say that those measures can be somewhat subjective, but the UK trails in each one, so there is a common theme. One other measure is the replacement rate that compares all sources of pension income versus previous earnings. On this measure, the UK, with an average over 10% less than those of the EU27 and the OECD, is ranked 19th out of 37, so still in the bottom half of the table.
As I have stated, this means that inequality in the UK continues into retirement and the UK has the 12th highest pensioner poverty rate out of 35 countries measured by the OECD. What that means, if we turn that around, is that in terms of disposable income to support a standard of living for those aged 66-plus, the UK is ranked 24th out of 35 countries, while Iceland, Denmark and Norway occupy the top spots. Ireland is in eighth place. And those statistics are based on comparisons before the UK broke the triple lock and the link to earnings last year. It is absolutely critical that the triple lock is restored. Independent Age emphasises that:
“With more than 2 million pensioners already living in poverty and the cost-of-living crisis hitting hard, we know people are being forced to make impossible choices on how to cut back to be able to afford heating, electricity and food”.
One additional income support measure is pension credit, but we know that take-up levels are still too low—the Secretary of State acknowledged that. Previous research commissioned by Independent Age estimated that full take-up of pension credit could lift 440,000 older people out of poverty. So when will that be tackled by the Government? The unclaimed £4 billion in pension credit could make the lives of hundreds of thousands of pensioners more bearable. It is also money that would then be recirculated within local economies as it is spent on vital household needs.
David Linden
Does my hon. Friend think that banks have a role to play? Given that the vast majority of pensioners receive their pension payments from the Department for Work and Pensions into their bank accounts, banks have the ability to identify where payments are coming from and the amount. Does he agree that there is an opportunity for banks to play a role in promoting pension credit?
Alan Brown
That is a very good point. I agree with my hon. Friend that that is an ideal way of managing that. I urge the Secretary of State to take heed of that intervention and work with banks and other organisations to try to increase pension credit take-up.
In terms of pension policies, of course I have to refer to the WASPI—Women Against State Pension Inequality Campaign—scandal and the fact that the Government are still not moving forward on fast and fair compensation, given that the Parliamentary and Health Service Ombudsman found there was maladministration. The PHSO made it clear that the Government do not have to wait for the end of its investigation to take action to remedy this injustice.
There is also the frozen pensions scandal, whereby whether your pension gets uprated or not is arbitrary, depending on which country you reside in. It is also scandalous that the UK Government have yet again rejected offers from the Canadian Government to enter into reciprocal arrangements. I urge the Secretary of State to reconsider that and engage in meaningful talks with the Canadian Government.
All those aspects show that the state pension in the UK is not the safety net we are told it is. It shows clearly that the Better Together mantra of staying in the UK to protect pensions in Scotland was a cruelly false premise. Indeed, with private pensions nearly collapsing after the Tory mini-Budget, that claim looks even more ridiculous. It also shows that when Gordon Brown, at a Better Together event, said:
“Our UK welfare state offers better protection for pensioners, disabled and the unemployed”,
he was, frankly, lying.
Madam Deputy Speaker (Dame Eleanor Laing)
Order. It would be better if the hon. Gentleman found other words—perhaps a little gentler—rather than those he has just used.
Alan Brown
I take your point, Madam Deputy Speaker, but of course I was not referring to any hon. Member in this place.
Madam Deputy Speaker
Order. I fully appreciate that and the hon. Gentleman is technically correct, but I take the view that anyone who has been a right hon. Member, and held a most senior position in this place, should be treated with respect even after they have left. A different form of words would therefore be appreciated.
Alan Brown
Thank you, Madam Deputy Speaker. I respectfully say that his comments were misleading because, as I have outlined, the UK pension is not as good as it is made out to be and is one of the poorest in north-west Europe.
Moving on, it is little wonder that the Scottish Government have been publishing papers comparing the UK to comparator countries for an independent Scotland. Scotland has a lower pensioner poverty rate than the rest of the UK at present, but we want to do much better than that. We want to match or better the comparator countries, reduce inequality during working life, and allow a more dignified and enjoyable retirement for all. We no longer want to be left here hoping, yet again, that Westminster will make the right decisions on such measures as the triple lock. We want to do things for the betterment of the citizens of Scotland.
Kevin Foster (Torbay) (Con)
This is my first Opposition day speech in a while and I welcome the opportunity to speak on an issue that is so important for Torbay. It will perhaps be unlike some of my previous speeches in that, first, I am not following the hon. Member for Strangford (Jim Shannon), and secondly—I see the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Mid Sussex (Mims Davies), on the Front Bench—this will not be quite as thorough an analysis of the issue as some have occasionally enjoyed from me on a Friday. It is a particular pleasure to see the Secretary of State on the Front Bench; I know that he will be a doughty champion for our beautiful county and its people, and that he will ensure that the most vulnerable are protected.
Turning to the motion, it is fascinating to see the huge enthusiasm from Labour Members for our 2019 manifesto. I cannot remember the same enthusiasm three years ago, when they were not that enthusiastic to have a general election in the first place. This measure was a key part of the pledges that we made. We have heard some knockabout today, but we have to remind ourselves that the pension triple lock was introduced in 2010 and not before. For the 13 years prior to that, pensions had been linked to the rise in inflation and in prices, rather than the position adopted under the triple lock.
We know why we introduced the triple lock. As has been referred to, the inspiration came from the 75p increase some years earlier. It aimed to give a clear sense of the direction in which state pensions would go. It would either be in line with prices, as was done previously, or earnings—by reinstating a link to those—or it would be a minimum of 2.5%, providing clarity for those looking ahead to their retirement. As that was done in a simple way, it meant that pensions would be protected against price shocks and that they would keep pace with earnings as they went up. Since 2010, the level of the basic state pension has gone up by £2,300.
The measure also has to be seen in the light of other changes, such as the end of opting out and the introduction of the new state pension, which is clearer about what people will get when they retire. As has been touched on, it allows more years in which, for example, someone is bringing up children to count towards the state pension. The changes were about making what people have clearer and simpler so that they can plan in their retirement.
That was very welcome in Torbay. Those commitments were probably a reason why a seat that was held by another party for 18 years is solidly Conservative again. Most pensioners and those who vote in Torbay are realistic people. They recognise the impact of the pandemic last year and the odd outcomes it produced for earnings—for example, in the previous year when earnings went down, and last year when earnings jumped up. The double lock was therefore introduced for one year last year, using the CPI rate for the increase in the state pension.
Some people say, “If inflation was good enough to be the rate of increase last year, it should be good enough this year, not least given the impacts we are seeing on prices.” I accept that there is a need for balance and the Secretary of State’s point that he cannot pre-empt what will be said next week. We cannot have a running commentary in the run-up to a fiscal event, with a different Department every day ruling something in or out, or putting something in or out. I take his point, but those of us who are not on the Front Bench can make our comments more freely about the outcome that we would like next week.
On the position in Torbay, the Secretary of State was right to highlight other benefits and support that is being offered to pensioners. The second cost of living payments are starting today, not just for pensioners; I think 16,300 families in Torbay will start to get that payment, taking the total up to £650. Members have rightly touched on the energy price guarantee, which helps to cap the price being paid for energy. On top of that, there were such things as the council tax rebate earlier this year. Councils have discretionary funding to apply that to those in band E and above when they have particular pressures. Therefore, when we discuss the triple lock and the state pension, we have to consider some of the other support. Of course, I have not mentioned the £400 per household energy bill discount from which pensioners will innately benefit.
It is interesting to hear people making comparisons with other countries and talking about wanting to emulate some of them. I would be interested to hear whether SNP Members would like to emulate the situation in many European countries whereby, although the position on the pension might be different, pensioners have to pay certain medical charges and there are social care levies applied to pension income and taxes that would not be paid here. Certainly, many services that are provided free at the point of use and point of need under the NHS are charged for in other jurisdictions. If we make comparisons and say we want to emulate other countries, we need to be conscious of what we are arguing we should emulate. We can do more to help people to get pension credit.
Alan Brown
I used a whole suite of comparators to make my point, and the key thing is that the UK has the 12th highest poverty rate out of 35 countries. That is shameful, is it not?
Kevin Foster
The hon. Gentleman made the point in his speech that he was looking to emulate the packages given to pensioners in other countries. If he wants to emulate them, he should look at what those packages include, such as charges for medical services and tax rates that we do not charge here. The council tax rebate of £150 did a lot for my constituents. As for whether that applies in Scotland, that is a devolved matter.
On the triple lock, the rise in prices has hit many people. Many people over the state retirement age are unlikely to have the type of options that others may have to meet some of the rising costs. It is therefore vital that we look to honour our pledge to them. I accept that that pledge cannot be made immediately today, but I look forward to hearing further clarity on that next week.
About £4.7 million of pension credit went unclaimed in Torbay last year. That could have gone to some of the poorest households in the bay. When the Minister sums up, I would be interested to hear about the Government’s thoughts on that issue, particularly when so much data is available. The era of people filling in paper forms or going to a post office with a pension book is long gone. The vast majority of that is done through electronic means. This is about what could be done to fill the gap so that more people can get the support to which they are entitled, not least because once someone is assessed as being eligible for pension credit, it opens the door to a range of other benefits and support.
The Parliamentary Under-Secretary of State for Work and Pensions (Laura Trott)
I thank all hon. Members for their valuable contributions to the debate.
Since 2010, pensioner incomes have gone up, absolute pensioner poverty has gone down and we have corrected the historic inequalities towards women in the state pension. That is a record that we on the Government Benches can be proud of. The decision on how to uprate state pension for this year is taken by the Secretary of State at the same time as the uprating decision on all benefits for those of working age and over state pension age.
Alan Brown
The Minister is repeating what the Secretary of State said earlier about pensioner poverty going down. The reality is that it is down only on old statistics. Pensioner poverty is increasing. Fuel poverty is increasing. So will the Government update the House on what the true figures on poverty are in the UK?
Laura Trott
We absolutely recognise that this is a very difficult time for pensioners. That is why we put a substantial package of support in place, which I will come on to later.
The Secretary of State set out, when opening the debate, that the results of his uprating review will be announced alongside the autumn statement on 17 November. To nobody’s surprise, I will not be pre-empting the outcome of that review today. However, reflecting the debate this afternoon, it is important to highlight how pensioners have been supported since 2010.
The yearly amount of the basic state pension has risen by over £2,300 in cash terms, rightly highlighted during the debate by my hon. Friends the Members for South Cambridgeshire (Anthony Browne), for Torbay (Kevin Foster) and for Heywood and Middleton (Chris Clarkson). Average weekly pensioner incomes have increased by 12% in real terms and as a result absolute pensioner poverty has fallen by 400,000 since 2010.
We are forecast to spend over £134 billion on benefits for pensioners in 2022-23. That amounts to 5.4% of GDP.
Laura Trott
I will make a bit of progress; I have been quite generous on interventions.
We know that the coming months will be tough for everyone, but especially for pensioners. I thank all hon. Members who have raised cases on behalf of their constituents. The Government fully understand the difficulties that pensioners will face this winter and will stand by those in the most need. That is why the Government have made substantial support available for pensioners struggling with the cost of living this winter. As my hon. Friends the Members for Wantage (David Johnston) and for Gloucester (Richard Graham) pointed out, we have not heard much from the Labour Front-Bench team today about what their plan would be for this winter.
We have a plan that includes the £650 cost of living payment for those on pension credit to help with the rising cost of living. There is a £400 reduction on energy bills for all domestic electricity customers over the coming months and the £150 council tax rebate received by 85% of all UK households. Those on state pension will also receive an increased £500 winter fuel payment if they are under 80 or a £600 winter fuel payment if they are 80 or over. In total, that will mean that all pensioners receiving the state pension could receive up to £850 of additional support in the coming months and that pensioners on the lowest income who are claiming means-tested benefits will receive up to £1,500.
Laura Trott
I will make a bit of progress and then come back to the hon. Gentleman.
Pension credit was raised by a number of Members, including the hon. Member for Kilmarnock and Loudoun (Alan Brown), my hon. Friend the Member for Torbay, the right hon. Member for East Ham (Sir Stephen Timms), the hon. Member for Birmingham, Erdington (Mrs Hamilton), my hon. Friend the Member for Rother Valley and the hon. Members for Arfon (Hywel Williams) and for Wirral West (Margaret Greenwood). My predecessor—the Minister for Employment, my hon. Friend the Member for Hexham (Guy Opperman)—put in a huge amount of work to increase awareness of pension credit. We have seen a significant increase in the number of claims, peaking at a 275% increase year on year during pension credit awareness week in June. We know, however, that only seven out of 10 people who are eligible to claim it do so. That means that £3,300 of additional support is not being claimed by around 850,000 households. Clearly, it would make a significant difference if even some of that money—totalling £1.7 billion—made its way into the pockets of the poorest pensioners.
The benefit of pension credit is that, as many Members have mentioned, it passports to an array of additional support, even when a person’s entitlement is very small. A pension credit recipient will receive a TV licence if they are over the age of 75 and get access to housing benefit and council tax support. The second half of the Government’s cost of living support—worth £324—will also be paid to all pension credit recipients. However, time is running out for those who have not yet claimed pension credit. The crucial date is 18 December. If someone claims pension credit by then and is eligible for the maximum three-month backdating, they will receive £324 of support to which they are entitled. It is therefore essential that all of us here urge our constituents to visit the pension credit page of gov.uk or to call the number listed to check eligibility of claim.
On automatic enrolment, the right hon. Member for East Ham and my hon. Friend the Member for Torbay raised an interesting idea. From the information that I have, the Government do not have the data to be able to do it, but I will definitely explore further the point about local government and what more we can do with data.
Alan Brown
The Minister spoke about the extra support for pensioners—I think she said it was £850. Does she realise that that does not even cover the increase in the average energy bill, which has gone up from £1,100 to £2,500? More importantly, what does she think energy bills will be when the Government’s support ends come April?
Laura Trott
That does not include the energy price guarantee.
As the Secretary of State set out to the House and as I said at the start of my speech, we cannot pre-empt the fiscal statement, but it is the Conservatives who have increased the state pension, it was the Conservatives who introduced automatic enrolment and it is the Conservatives who have reduced absolute pensioner poverty. This Government have always protected and will always protect the most vulnerable: that has been our track record since 2010, and that is what we will continue to do.
Question put.
Oral Answers to Questions
Alan Brown Excerpts(1 year, 7 months ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
The Minister knows that in July 2021 the Parliamentary and Health Service Ombudsman found the DWP guilty of maladministration regarding state pension age increases. The PHSO also suggested that the Department could consider being proactive in remedying the injustice suffered by 3.8 million women, rather than waiting for its final conclusions. Given the ongoing cost of living crisis, does the Minister agree that now is the time for the Government to step up to the plate and agree fair and swift compensation for the women suffering that injustice?
Laura Trott
I am sorry to disappoint the hon. Gentleman but I must repeat that I cannot comment where there is an ongoing investigation.
Oral Answers to Questions
Alan Brown Excerpts(1 year, 10 months ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
The reality is that even before the Pensions Minister scrapped the triple lock, taking £500 out of the pockets of pensioners, the UK had pensioner poverty rates higher than small independent European countries. We now know that the Chancellor is reviewing the corporation tax rates, which were intended to raise £50 billion over the lifetime of this Parliament. How can he guarantee that the triple lock will not be sacrificed once more, trapping pensioners in poverty just to pay for Tory tax giveaways?
Guy Opperman
As the hon. Gentleman will be aware, the United Kingdom Government have provided £37 billion-worth of support—[Interruption.] Oh, we most definitely have. That takes the form of four different payments over the next six months and is a real support to the most vulnerable in our community. Without a shadow of a doubt, we will continue to support those most vulnerable.
Oral Answers to Questions
Alan Brown Excerpts(1 year, 12 months ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
The removal of the triple lock is costing pensioners £500 this year alone, and come October energy bills will have risen by £1,700 compared with April 2021. The £300 winter fuel payment does not come close to plugging that gap, let alone addressing the other inflationary pressures that pensioners are dealing with. Then we have the WASPI women, who have been struggling for years. Following the findings of the parliamentary and health service ombudsman, surely now—this time of crisis—is the time for the Government to agree fair and fast compensation for the WASPI women.
Guy Opperman
There was a lot in that question. In respect of the full package of support, most pensioner households will receive £850 via the additional winter fuel payment, the council tax rebate and the energy bills support scheme. Pensioners who receive means-tested benefits and are most in need of support will receive £1,500, including payments in July and September.
The hon. Gentleman will be aware that the matter of the WASPI women is a subject of and decision for the Court of Appeal, where the matter was decided in favour of successive Governments—this and the previous Labour Government—and that the ombudsman process is an ongoing one, on which we do not comment.
Working Tax Credit and Universal Credit: Two-Child Limit
Alan Brown Excerpts(2 years, 1 month ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
It is a pleasure to serve under your chairmanship, Mr McCabe, and I commend my hon. Friend the Member for Glasgow Central (Alison Thewliss) for having secured this debate. More importantly, I thank her for the tireless campaigning she has done on this two-child policy, which victimises and stigmatises families and children. It is worth putting on the record that my hon. Friend was the first Member to identify the pernicious rape clause, on Budget day in July 2015, and her speech shows just how much she has immersed herself in highlighting the unfairness of this policy and the ludicrous exemptions that go with it. As she has said, it is a poverty trap. The fact that children born beyond the midnight deadline are not deemed worthy of support, and that we now have two tiers of families—two families might be the same size, but by virtue of when one child was born, one family gets more support than the other—is absurd.
I also pay tribute to all other hon. Members who have contributed or made interventions. As the hon. Member for Cynon Valley (Beth Winter) said, this is about the need to support all children and ensure basic fairness; why do this UK Tory Government find it all too easy to breach human rights? The hon. Member for Arfon (Hywel Williams) made a powerful speech, talking about his own circumstances and how political attitudes have changed. The example he gave about the moral condemnation in the past of people stuck in mental institutions, and how we are returning to moral judgments of people having children, should make the Minister sit up, because it certainly made me sit up.
Then, of course, we had a fantastic contribution from the hon. Member for Strangford (Jim Shannon). It did start with his “better together” comparison, but apart from that, I agreed with every word he said. When the hon. Member for Strangford uses such strong language and condemns a policy so much—I genuinely think that was the best speech I have heard from the hon. Gentleman; that says a lot, but it was a really powerful speech—if the Minister does not take note, something is far wrong. The hon. Gentleman gave the example of the Chinese limit, and how it would have impacted families and people here had such a policy been implemented, but he also spoke about the dark perspective of this policy. It is morally wrong, and not just that: it has been an abject failure in its aims. That really summed it up, so I pay tribute to the hon. Gentleman for his speech.
It is disappointing that there are no Tory Back Benchers here to back up the policy. Maybe that says how bad the policy is, or maybe they are just choosing to back the corrupt Prime Minister in the “other place.” The point is that agreeing to provide welfare support for only two children is a horrible policy, backed up by dog-whistle politics. The concept clearly was that people should be able to afford children, just like those who rely solely on work for their income and therefore do not need additional welfare support. That is language designed to imply that anyone on benefits is a scrounger, and that people have children just to screw the welfare system. It is truly awful, and it actually puts a price on children.
As we have heard, in affected families, who suffers the most? The children. Hungry kids cannot learn in school. They will be disadvantaged and less likely to have a positive outcome, so whatever circle the Tories think they are breaking, they might be condemning more people to underachieve and have a higher chance of unemployment, and to be less likely to participate in higher and further education and more likely to end up in lower-paid, semi-skilled work. As the hon. Member for Strangford said, if some children suffer, others do. It is not just the ones directly affected.
Worst of all, the entire concept is based on politics and prejudice and not evidence. What we now have, clear as day, is evidence of how the policy works for those affected by the two-child policy. The Library briefing confirmed that of the 317,500 families affected in April 2021, 56% had somebody in the household working. The majority, also 56%, were in dual-parent households, so the majority of families affected are dual-parent households with somebody in employment. That is proof that the policy is based on falsehoods and proof that the bigger issue is that too many people are in low-paid, insecure jobs, and that is the issue that should be tackled.
What about the people who have lost jobs or faced reduced income due to covid? They now find that the so-called safety net of the welfare state is a lot smaller than they would have anticipated. The Tory Brexit has also impacted jobs, too. The Tories deny that, but I have a meeting tomorrow with somebody who runs a haulage company, and he is close to going under, which will take other jobs with him, because of the ludicrous cabotage rules that the Tory Government signed up to.
Covid unfortunately gave us fire and rehire—another policy that the Tories have done nothing to eliminate, but a policy that is vastly reducing the incomes of thousands of workers or seeing them sacked. Workers that the Tories might otherwise have seen as model families who were able to afford their children without welfare support will now need that support, and it might not be there for them. Families and people who have lost jobs are now having to readjust their outgoings accordingly, and now find that they have been categorised as scroungers by the Tory Government.
Another key issue of the two-child policy is that, as others have said, it disproportionately affects orthodox Jewish and Muslim families who may have religious or ethical views on family size. I agree with the intervention by the hon. Member for Strangford that the religious aspect in terms of discrimination has possible human rights implications as well.
We have heard that some women have considered abortion because they worry about not being able to afford a child. There are debates about how many women have actually undertaken an abortion because of that, but the reality is that women are having to face that choice, and they should not have to. Again, that is something the Minister needs to look at and review.
Carol Monaghan
There are debates about that, but the statistics are clear. The National Audit Office numbers show that since 2016, since the policy came into being, there has been a 24% increase in the number of abortions in England and Wales.
Alan Brown
I thank my hon. Friend for that. I will not disagree. The hon. Member for Strangford also referred to evidential work done by the LSE. This is evidence that the Government should look at. We are discussing a Government who talk about family values. How can they talk about family values when they are forcing women to consider abortion?
That takes us to other evidence of the impact of this policy. Since 2013-14, child poverty among larger families has risen dramatically; almost half of all children living in families that have more than two children live in poverty. Also, recent research for the report “Benefit changes and larger families” by largerfamilies.study shows that most of the recent rise in child poverty overall has been driven by rising poverty among those larger families.
Sara Ogilvie of the Child Poverty Action Group has said:
“The two child limit is a brutal policy that punishes children simply for having brothers and sisters. It forces families to survive on less than they need, and with soaring living costs the hardship and hunger these families face will only intensify.”
Also, according to CPAG:
“Removing the policy would lift 250,000 children out of poverty”,
doing so immediately. So, surely the Minister must review the evidence, act accordingly and take that action to
“lift…children out of poverty”.
Then, if we look at the rape exemption clause, it is apparent that it was thought up on the hoof at the time. It was probably some loose nod by the Government towards thinking that they were adding a moral, even noble, exemption to support children born after their mother’s traumatic experience of being raped. However, it is no wonder that Ministers at the time could not even explain how the policy would be implemented, because it was so absurd. No thought was given to the traumatic psychological effects of a woman having to relive such an experience and being asked to fill in forms to justify financial support for her child. Also, the bizarre logic of the exemption only applies for subsequent children, beyond the two-child limit, born of rape. So, as if the clause in itself is not abhorrent enough, it is somehow seen as being morally okay to decide which child born from rape is worthy of support, which is truly disgusting.
The other big thing aligned with this policy and other policies at the time was the whole “balancing the books” mantra. This debate made me revisit the 2015 summer Budget Red Book. I looked back at that and honestly it is truly horrifying to see how evil that Budget was. The two-child clause was estimated to save £3.4 billion by 2021; freezing benefits, £11.3 billion; benefit cap reduction, £1.7 billion, clawed back from the poor; and increasing the tax credits taper to 48% while reducing income thresholds for tax credits and work allowance was estimated to save—astonishingly—nearly £20 billion by 2021. So, there was a complete and utter hatchet job on the welfare state, and there were also incoherent policies, given the attack on some of the job-related welfare support—so much for “making work pay”. That was an awful Budget and I have to point out that it was shameful that Labour abstained on it.
However, what about the “balancing the books” mantra? Clearly, as I have just illustrated, it is “balancing the books” on the poorest, the most infirm and the lowest-paid in society. But what it also allowed in subsequent Budgets was tax giveaways to those who the Tories deemed worthy of benefiting from them.
Previously, I had the Library conduct analysis on some of the key Budget decisions that were implemented from 2016 to 2018. The Library extrapolated those figures, which were based on figures that were presented in the Budget books, up to 2025, and it estimated that, up to 2025, the Treasury was giving away £80 billion. Increasing the higher rate threshold was estimated to be a giveaway worth £5 billion; changes to individual savings accounts, or ISAs, £7 billion; inheritance tax changes, a £6 billion giveaway; and the personal allowance increase and further raising of the higher threshold to £50,000 of income was estimated to be an £11 billion giveaway by the Tories. There was also a £50 billion giveaway in corporation tax, although at least they realised the error of their ways on that one. All of that shows that plenty of money was found for giveaways, rather than for continuing to balance the books properly. And those figures show that the Tories could easily afford to reverse this two-child policy, if the political will to do so was there.
Returning to the here and now, another issue with universal tax overall is of course the removal of the uplift, or—more appropriately—a cut of £1,040 a year. As the hon. Member for Cynon Valley said, if the pandemic merited an uplift to allow people a more dignified life, then surely—with inflation running at 7% to 8%, the energy cap up 75% compared to April 2021 and petrol at record prices—there is a clear need for a permanent increase in universal credit.
I cannot finish without comparing this with what is happening in Scotland with the Scottish Government, just as my hon. Friend the Member for Glasgow Central did. The Scottish Government introduced the game-changing child payment, doubling it to £20 a week, and it will increase to £25 a week when the benefit is extended to under-16s at the end of this year. As that has been done on a fixed budget in the Scottish Parliament, it cannot have the positive impact it otherwise would have had because we are still living with the impact of Tory austerity. That is proof that whatever the Scottish Government do is undertaken with one hand behind their back. It is interesting that there was a strong theme earlier in the debate about the Welsh Government needing more powers too, so Tory policies are clearly having an impact on the Union, which should make the Minister take note.
Will the Minister pledge to review the effects of the impact of the Scottish Government’s child payment policy and the support it has received from charitable organisations? The Scottish Government have shown that they are treating all children equally. That should not be too much to ask of any Government, and surely it is time for the UK Government to think again.
David Rutley
The point that I am trying to make is that the benefits system is important—it provides support—but it is not the only thing that we are trying to do for people and for claimants.
As the hon. Member for Westminster North (Ms Buck) has highlighted, many of those people are working while on benefits. We want them to get into work and, when they are in employment, to progress. As has been debated long and hard in this Chamber, we have recently introduced work coaches who focus on in-work progression; we have 37 champions across the country who are helping to push that agenda forward. That is vital so that people can progress. People do not depend just on the benefits system; we want them to see more in their wage packet, and we have provided work incentives to do that, be it through the UC taper rate changes that have been put in place or through the increased work allowances. Those are vital incentives.
David Rutley
I will give way to the SNP spokesperson, but then I will make some progress, because others have made many points and I have several to make myself.
Alan Brown
I thank the Minister for giving way. On the point about helping people’s wage packets and making work pay, does he not agree that the minimum wage should reflect the national living wage so that people get a proper, fair wage?
David Rutley
As I think the hon. Gentleman knows, the national minimum wage has gone up to £9.50—[Interruption.] There is a bit of head-shaking going on; it is very disturbing. The national minimum wage is now £9.50 and is projected by many to reach £10. The £9.50 figure is a 6.6% increase, which is very welcome. I am sure that the hon. Gentleman will join me in welcoming that significant increase.
A few things have been said about the non-consensual conception exemption. We recognise that it is a difficult and sensitive issue, and we have put in place procedures that are mindful of the sensitivities involved. Third-party professionals include healthcare professionals, registered social workers and relevant specialist charities, which can also signpost claimants to further support, so claimants will get the support that they need and be assisted through the light-touch processes in challenging circumstances. The hon. Member for Glasgow Central made a point about rape conviction rates. I reassure her—I think she knows this, but let me put it on the record—that the criteria for the non-consensual conception exemption is much wider than just conviction. The third-party professionals can assist in those circumstances as well.
The hon. Member for Strangford (Jim Shannon), who I think everybody in this Chamber loves, highlighted many situations—nearly all of them, actually. I agree with him that there are a few exceptions, but clearly, we will have differences of opinion on this point. He and I share a love of ensuring that people can express their faith freely—that is a fundamental part of our democracy—and the policy does not seek to get in the way of that vital democratic right and freedom that we all cherish. The Government have published an impact assessment noting that ethnic minority households may be more likely to be impacted by the policy because they are, on average, more likely to be in receipt of child tax credit or universal credit, or to have larger families. That could also be the case for households of a particular religion, but the DWP has insufficient data to confirm that. I highlight that the Supreme Court found that the two-child policy was lawful and not in breach of the European convention on human rights.
Points have been made about abortion and fertility rates. The Nuffield Foundation’s research consortium on larger families has this month published a report outlining that fertility rates for those claiming, or eligible to claim, benefits have changed very little since the introduction of the policy. That would seem to refute the evidence from the British Pregnancy Advisory Service that was discussed earlier. The policy was never designed to affect fertility rates; it is fundamentally about seeking to provide fairness with those who are unable to access benefits, when it comes to the choices that they have to make.
The hon. Member for Glasgow Central also asked the question—
Oral Answers to Questions
Alan Brown Excerpts(2 years, 2 months ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
Despite what the Minister says, the Government’s last-published figures show that there are 200,000 more pensioners in poverty compared with 2018-19, and it is going to get worse. Next month, pensioners will face an increase in their heating bills of over £800 a year compared with this time last year, and at the same time, due to breaking their triple lock promise, the Government will have taken £500 a year out of the pockets of pensioners. It is shameful. Does he agree that Wednesday represents the one opportunity the Chancellor has to reverse the breaking of the triple lock and to do something to help pensioners?
Guy Opperman
I wish the hon. Gentleman a swift recovery from the trip or fall that caused his injury.
It is definitely the case that pensioner poverty is declining. [Interruption.] The hon. Gentleman’s statistic is manifestly wrong on that: pensioner poverty is down in relation to 2009-10. Of course, there are conversations with the Chancellor, but it is absolutely the case that state pension has increased year on year on year, and we have never paid a higher state pension than we presently do.