Pensions Bill

Lord Forsyth of Drumlean Excerpts

Monday 24th February 2014 Lords Chamber

[Lord German (LD)]

My Lords, the issues raised by this amendment are important, and I congratulate the noble Baroness, Lady Hollis, on her dedication to the issue over many years. She kindly told us in Committee how she was rebuffed by her own Government and today she repeated the argument that they used against her: one could not reasonably divvy up an employer’s national insurance—she used those words today again—if there were two or more such jobs. She further told us that women would not want to pay class 1 contributions. For that reason, this is an important issue. We are looking at people being able to contribute to their own pension and get the credits that they need to win a full pension in under 35 years.

Much of the discussion that noble Lords have heard today and in Committee has been about the way that people behave individually in response to the issues in front of them and about how people’s live are dealt with. The problem that we face is that there are no reliable statistics or evidence that show how individuals’ behaviour works. It is clearly possible—I heard it both in Committee and here today—to illustrate that in a way that works to the best of the argument that says that we need to move on this swiftly because there are so many people involved in a particular category. I do not mind people making contributions about the way people behave, will want to behave or are forced to behave, but I want to know how we can sort this problem out and do so in a realistic way that will result in a concrete outcome.

We are bound to hear more and more about zero-hours contracts. They are not a new phenomenon. Over the past 70 years, the notion of a job for life has all but disappeared. More and more people are spending time in self-employment, many people have more than one job and more people have part-time jobs. The single-tier pension itself is designed in such a way that an individual with a more varied work history will be able to build up their national insurance records to achieve the maximum state pension outcome, provided of course they get credited for their national insurance contributions.

The crucial issue, therefore, is whether universal credit will pick up and deal with this issue. I suspect that the answer given to the noble Baroness, Lady Hollis, when she raised this issue with her own Government, was that this is a very typically difficult issue for HMRC, given the range of information that it would require from every company in the land about who they employed and that it would have to combine the results and put them into a single file. That is of course precisely the process that is taking place, and will take place, through universal credit, which will pick up levels of flexible income including, by implication, that relating to zero-hours contracts. It is interesting that the lower earnings level, below which you do not have to pay or get credit for national insurance contributions, is £5,772 per annum at present. The Labour Force Survey figures show that those on zero-hours contracts work, on average, 20 hours a week at £9 an hour, which is enough to exceed the lower earnings limit. If the figures we have before us are to be believed, most people will be receiving enough income to receive the national insurance contribution.

The other issue about universal credit is that it will look very carefully at how it credits people and bring, as we have heard, another 800,000 people into the crediting system. For example, a single person without savings, earning below that £5,772 per annum level, will be eligible for universal credit and thereby eligible for the national insurance contribution. The question that I have to ask my noble friend is about the delivery of universal credit. In Committee, the Minister said it would be delivered in 2016-17 and the noble Baroness, Lady Hollis, said in 2019-20, although she hoped it might be earlier than that. I apologise if it was somebody else on her Benches but those are the sorts of span. If we believe my noble friend, and it is 2016-17, will this problem be dealt with from the outset by those who are then brought into the universal credit system? If that is the timetable, I ask noble Lords to consider how long it would take to put in the interim solution. In effect, what is being asked for is an interim solution between now and when universal credit comes in for a pensions system that comes into play in 2016.

What is the interim position? Do we need to ask HMRC to invent a system for itself? When the noble Baroness, Lady Hollis, asked the Labour Government for one in their time, they rejected it. I believe they said that it would be cumbersome and expensive. Do we need to have that in place or could we be reassured that, almost within the very short period of the implementation of the single-tier pension, universal credit will be in place in a sufficient and timely position so that the vast majority of people who are occupying two or more jobs that produce an income over a year of less than £5,772 at the current rates will be able to be credited? That is the key question.

[Lord Forsyth of Drumlean (Con)]

I did not participate in Committee but I am listening to my noble friend’s carefully constructed argument. Is not the point about this amendment that it is permissive? It simply provides the Government with an alternative; it does not oblige them to do anything. I cannot really understand why my noble friend is opposing the amendment while advancing that argument.

[Lord German]

It is because we have a response in place, which is the universal credit system. What matters more than anything is that the system is in place in time to capture the people who will be most affected by this in the implementation years, from 2016 onwards. That is the fundamental question and I await the answer in my noble friend’s response.

Universal Credit

Lord Forsyth of Drumlean Excerpts

Tuesday 10th December 2013 Lords Chamber

[Lord Forsyth of Drumlean (Con)]

My Lords, will my noble friend resist the bullying from the opposition Benches to move this programme at a speed that would result in difficulties? Will he gently remind them that the system he inherited was one where the poorest people in the land effectively paid marginal rates of tax of more than 95%? The Secretary of State is to be congratulated on taking this very complex system and making it worth while for people to be in work as opposed to being out of work and on benefits, and doing it with sensitivity that takes account of the needs of all groups. He should ignore the opposition, who considerably failed in government to tackle this appalling problem.

[Lord Freud]

My Lords, if you do these major cultural transformations, it is absolutely vital that you do them at the pace at which you can. One thing we are doing, which is a development from our thinking in 2010, is a huge programme of testing, learning and implementing. In particular, one thing we have introduced in the past two years—thanks, I must acknowledge, to help from this Chamber—is very substantial work with local authorities on the local support service framework. I think that will support the vulnerable in a way that they have never been supported in this country in the past.

Disabled People: Mobility Benefits

Lord Forsyth of Drumlean Excerpts

Monday 2nd December 2013 Lords Chamber

[Lord Freud]

My Lords, that is not the process which we are going through. It is difficult to draw a line between people with enhanced mobility and those on Motability. That is one of the things that we will be looking at as we do this review, which will report towards the end of next year—before large volumes of people are due to go in, so we will be able to look at this closely.

[Lord Forsyth of Drumlean (Con)]

My Lords, can my noble friend indicate whether he is satisfied that every penny that is available to Motability goes to those in greatest need? Can he tell the House what the salary is of the highest paid director?

[Lord Freud]

My Lords, Motability puts out a report and accounts. I was looking through the latest the other day, which was from 2012, and its highest paid director was paid something more than £800,000.

Housing: Under-Occupancy Charge

Lord Forsyth of Drumlean Excerpts

Wednesday 9th October 2013 Lords Chamber

[Lord Freud]

I suggest to the Opposition that they think about the challenges that they will face when they extend their extra-bedroom policy to the private rented sector, which will cost them another £500 million and rising.

[Lord Forsyth of Drumlean (Con)]

Will my noble friend explain why the Opposition are so opposed to the changes that are being proposed on the subsidy, when it will undoubtedly help people suffering from chronic overcrowding in social housing and will help young people who find it impossible to get single accommodation? Will not the effect of removing the subsidy be to correct the market failure in social housing?

[Lord Freud]

My Lords, my noble friend is absolutely right. I have talked before about the 250,000 people living in overcrowded accommodation, with 1.8 million people on the waiting list. But the economic signals going on in the social rented sector are very odd. The demand from single people and couples represents each year 61%, for the latest year we have—and it has not changed much. The number of homes provided that have single bedrooms comes to only 13%. Over the past decade, the social rented sector has built virtually no new single bedrooms, at 30,000; that compares with the private rented sector, which has produced in that period 280,000. There is a real economic mismatch going on in terms of what we are encouraging the social rented sector to build, and we need to make sure that we are building the type of accommodation that people in this country actually need.

Marriage (Same Sex Couples) Bill

Lord Forsyth of Drumlean Excerpts

Tuesday 4th June 2013 Lords Chamber

[Lord Forsyth of Drumlean]

My Lords, I will speak very briefly in the gap, of which I have given notice. I think I am entitled to four minutes, which is the time people in the other place—the elected Members—had to talk on a matter of this importance.

I am usually at one with my noble friend Lord Norton of Louth, but when he says that it is up to us to decide I say no, it is not. We can make laws, but they have to carry consent. Next week it will be 30 years since I was first elected to the other place. I have never known a measure—not even the poll tax—that has produced such division and concern on both sides of the argument. It is important that we take account of that. What worries me about the Bill is the speed with which it has been whisked through the House of Commons and is now being whisked through here. I am told that we are going to be allowed two days in Committee. As the noble Lord, Lord Brennan, pointed out, the Civil Partnership Bill had far more than that—I think it had five days in Committee. The idea that we can deal with a matter of this importance in two days in Committee when we have had two days on Second Reading is ridiculous. What is the haste? What is forcing the pace of this matter?

On the letters and e-mails we have had, I acknowledge that some people who have written have used quite offensive terms. One of the qualities of the debate that we have had so far in this House has been the civilised and respectful way in which we have listened to the arguments. I would have preferred the House of Commons to have dealt with this matter in the normal way, as we have done on other controversial issues: a Private Member’s Bill, with the Government providing time, and with a Committee of the whole House. Instead, we had a Committee which was stacked and a guillotine—and, by the way, we had a manifesto commitment to end the automatic timetabling of Bills. This Bill, above all others, should not have been subject to a timetable Motion.

In this House we are now faced with the question which I want to address. I will be supporting the amendment in the name of the noble Lord, Lord Dear, because the House of Commons needs to think again. It needs to produce a White Paper or a Green Paper, and the public need to be involved in this discussion so that it carries consent. At the end of the day, consent is the most important thing. Listening to the debate in this House, and to the right reverend Prelate, I believe that consensus can be achieved, but the Bill is no way to achieve it.

The Bill was certainly not a manifesto commitment. My noble friend says that it does not matter. Yes, it does. If it had been, it would have been quite wrong for us to vote for the amendment in the name of the noble Lord, Lord Dear. This House is entitled to vote for the noble Lord’s amendment because the House of Commons has not had an opportunity properly to consider it, and indeed, the Bill would not have come to this place had a deal not been done by the Labour Front Bench with the Government to support the Bill in return for a commitment to consider whether civil partnerships should be extended to heterosexual couples. That is a very important measure that could be taken, but we are told that it is very complicated, it will take a very long time, and they need that time. This is very complicated as well. We are entitled to vote for the amendment in the name of the noble Lord, Lord Dear, and I shall do so, because the process by which this Bill has been handled is inappropriate, and has left the country divided, bewildered and puzzled by something that has come out of a blue sky. That is not a proper way in which to make such a major social reform.

Welfare Benefits: Women

Lord Forsyth of Drumlean Excerpts

Thursday 10th January 2013 Lords Chamber

[Lord Freud]

My Lords, the impact on women of the uprating changes, in a Bill that will come to this House shortly, is greater; 33% of women are affected, against only 29% of men. The redistribution under universal credit switches slightly and, in proportion, households with women do slightly better in numbers than households with men—40% of households with women are gainers, compared with 39% of households with men.

[Lord Forsyth of Drumlean]

My Lords, can my noble friend explain how it can be fair that, because of the changes in child benefit, in households with three children where only one partner is working and has a student loan, if their salary goes up from £50,000 to £60,000, they will face an effective marginal tax of 75%? In contrast, households with incomes of £100,000, where both partners are working, will face a marginal tax of 45%. How is that consistent with a fairer tax system?

[Lord Freud]

My Lords, the reason for the reduction in child benefit for those on higher incomes is so that it could be implemented in this way. As my noble friend will know, it has been adjusted to provide a taper at £50,000 to £60,000 to smooth that transition.

Equality: EC Policies on Women on Corporate Boards

Lord Forsyth of Drumlean Excerpts

Wednesday 17th October 2012 Lords Chamber

[Baroness Stowell of Beeston]

Just to be absolutely clear, while we do not support the quotas or the European legislation, we feel very strongly about this issue. I think that I am right in saying that we have a target of 50% for appointments to public bodies by 2020. If I am wrong I will write to the noble Baroness, but we are definitely ensuring that as much effort is made in that area as it is in the corporate world.

[Lord Forsyth of Drumlean]

My Lords, as two-thirds of the European Commission membership are themselves men, would not the Commission do better to put its own house in order before deciding on other people?

[Baroness Stowell of Beeston]

My Lords, I shall not say anything.

Workers’ Memorial Day

Lord Forsyth of Drumlean Excerpts

Monday 23rd April 2012 Lords Chamber

[Lord Freud]

I am spending considerable time on mesothelioma currently and I hope to sort out the real problem, which is the large number of people suffering from the illness who are getting no compensation at all because they cannot trace who was insuring them. I hope to see some real progress in this area—looking at the whole area of mesothelioma, both those who have been traced and those who are untraced—and to report back on that in the not too distant future, certainly before the summer.

[Lord Forsyth of Drumlean]

My Lords, when I was responsible for health and safety as a Minister I asked to see all the regulations applying to small businesses. There was a three-month delay, and when I asked why, I was told that the Health and Safety Executive would have to hire a pantechnicon to send them round. Is the Prime Minister not absolutely right to emphasise the importance of the culture of health and safety in the workplace, rather than masses of regulations that people cannot possibly be expected to absorb and comprehend?

[Lord Freud]

Yes, my Lords, the Prime Minister is right: legislation must be comprehensible to people if it is to be useful. That process is currently under way, and we aim to reduce the legislation by up to half by 2014. We are confident that that can be done in a way that actually enhances the effectiveness of our health and safety regime.

Youth Unemployment

Lord Forsyth of Drumlean Excerpts

Tuesday 14th February 2012 Lords Chamber

[Lord Freud]

My Lords, a point that I have made here in the past is that we have had a structural issue with youth unemployment for more than a decade, The number of youngsters inactive or unemployed has been growing steadily, right through to the end of the longest boom that we have ever had. My view—and the Government’s view—is that the best way to tackle that is to make sure that youngsters have education that gets them fit for the workplace. That is why this Government have taken on in toto all of Professor Wolf’s recommendations, because they deal with these core issues.

[Lord Forsyth of Drumlean]

My Lords, on that point, does my noble friend not agree that one of the mistakes we have made over the past 15 or so years is to encourage youngsters to go for degrees at university rather than vocational courses that provide them with the skills that are demanded and, indeed, are in short supply in the labour market?

[Lord Freud]

My Lords, the most shocking thing in Professor Wolf’s report was when he said—I shall quote it—

“as a society we are failing at least 350,000 of our 16-18 year olds, year on year”,

because we had been providing them with vocational education that did not lead them anywhere. That is why our strategy to increase apprenticeships and get vocational training back under control is so important for this generation.

Benefits: EU Nationals

Lord Forsyth of Drumlean Excerpts

Monday 7th November 2011 Lords Chamber

[Lord Freud]

My Lords, we have had this discussion during the Committee stage of the Welfare Reform Bill and I have made it absolutely clear that I am not going to comment on that particular question in any way.

[Lord Forsyth of Drumlean]

My Lords, can my noble friend comment on the fact that EU law requires equal treatment between citizens of member states, but not within member states? So we have the absurd position in Scotland, for example, where English, Welsh and Irish residents have to pay university fees of £36,000 while for Scottish students, along with French, German, Italian and other European students, they are free. Is that not grossly unfair and should not the law be changed so that residents in other parts of the United Kingdom are treated in the same way as EU citizens?

[Lord Freud]

My Lords, I am being taken well off my brief which is concerned with benefits, so I will not comment on that question either.