Transitional State Pension Arrangements for Women

Alan Brown Excerpts

Wednesday 24th February 2016 Commons Chamber

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

This is the fourth WASPI campaign debate that I have spoken in, and it is hard to find something new to say. I note that the Minister had the same problem, because his earlier performance at the Dispatch Box was a disgrace. He said that he would talk about transitional arrangements, but he did not—he avoided the matter the whole time, took interventions and fudged the issue. Let me remind him of a suggestion that he made in a previous answer to an oral question, when he said that women could use the pension freedoms to help themselves bridge the gap and transition to state pension age. For me, that shows that he does not understand that women are less likely to have pensions, and that the pensions they do have are more likely to be low in value. To suggest that women should blow their savings as a remedial measure, instead of the Government helping out, is crazy and irresponsible.

I also want to make the Minister aware of another ongoing issue that could compound matters and affect people’s choice, namely the exit payment gap in the Enterprise Bill. The cap in its current format will further limit the choices for people considering early retirement or voluntary redundancy. The £95,000 cap will affect not the so-called fat cats but long-serving, lower paid workers. The cap in its current format covers the strain on pension funds that an employer requires to pay for early and ill-health retirement. That means that people taking ill-health retirement might have the money due to them capped because of this Government. That compounds matters. The exit cap prevents councils, such as the local authority I was a councillor for, from operating schemes such as Teacher Refresh, which allows higher paid experienced teachers to opt for early retirement. That allows younger teachers to be employed, saving the taxpayer money overall and creating jobs for younger teachers. Combine the cap with the increased retirement age and we have a bad deal for individuals—mainly women—a bad deal for local authorities, and a bad deal for the taxpayer overall.

Another impact of the increase in the state pension age in the 2011 Act is that it can make women more dependent on male partners. That is bad for personal esteem, bad for relationships and potentially damaging in cases of domestic abuse where women feel trapped financially. Women are concerned and are feeling stress due to the bombshell that has been dropped on them. Instead of ignoring what is going on and ignoring the four debates, the Government should think about the consequences and do something about them.

The Government hide behind the £30 billion estimate to fully reverse the 2011 Act. People today are asking for transitional arrangements, but the £30 billion to do a full reversal could be found. The Government found an extra £16 billion in the defence review for Trident, to add to the £167 billion that had already been committed. They have allocated £12 billion for the right to buy social housing. They could introduce a bank levy and a mansion tax. They could reverse the inheritance tax and stop adding more people to the other place. Those are all choices to spend more money or subsidise other policies, while introducing austerity in other ways.

The Government have already lost court cases relating to the personal independence payment and the bedroom tax. There is a great chance they will lose another court case due to the unfairness of this measure and the lack of notice given to women. As has been said, this is a breach of contract. I ask the Minister to please take that into account and to put in place some transitional arrangements.

Transitional State Pension Arrangements for Women

Alan Brown Excerpts

Monday 1st February 2016 Westminster Hall

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

There seems to be widespread consensus that that acceleration of the equalisation of the state pension age directly discriminates against women born on or after 6 April 1951. We all agree that women have not been given fair notice to prepare and manage their plans and finances for an additional number of years before receiving their state pension. Many women in my constituency are genuinely alarmed and worried about their financial future due to the lack of preparation time that they have had. As has been said—it bears repeating—life expectancy across the UK is not uniform, and that creates complexities when discussing this issue.

It has been hinted at but not explicitly said today that it is a real shame and a real disappointment that that fantastic crusader for people of pension age, Baroness Altmann, has allowed herself to be effectively neutralised by her ennoblement. Many women face the real prospect of cancelling retirement plans after a lifetime of work. That goes against the grain of natural justice, and it demands to be addressed because it is a breach of contract.

A DWP research report in 2004 found that only 43% of the women affected were able to identify their own state pension age as 65 years or between 60 and 65 years. That low figure was identified as a cause for real concern, showing that information about the increase in the state pension age was

“not reaching the group of individuals who arguably have the greatest need to be informed.”

Levels of awareness were even lower among women who were economically inactive or in routine and manual occupations, standing at a mere 36%.

Women born in the 1950s have been affected by significant changes to their state pension age with a lack of appropriate notification, little notice and much faster than promised. That can have only one outcome: straitened financial circumstances for women as they frantically try to prepare and re-plan retirement. With retirement a further four, five or even six years further away than originally thought, it is not just financially challenging; it is cruel and heartless. All of this, as has been said, is in the context of a lifetime of low pay and inequality faced by far too many women and the old-age problems that are a cumulative effect of that.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

My hon. Friend talks about the lack of planning. In the Chamber earlier today, one of the fallback measures suggested by the Minister was that women could use pension freedoms. That shows a lack of understanding that women are less likely to have a private pension that they can cash in, but to suggest they cash it in to help them get by these few years is absolutely irresponsible.

[Patricia Gibson]

Absolutely. I concur with everything that my hon. Friend has said.

Clearly, and despite the lack of action, the Government know there is a problem. Steve Webb, the Pensions Minister in the coalition Government, has admitted that the period of notice being given to some women was “the key issue”. He further went on to indicate that he recognised that not everyone affected by the 1995 Act had been aware of it. The Government must take responsibility for that. Why did they not act in this matter earlier to ensure that the women affected were fully informed? Why were women left in the dark, blissfully unaware that their retirement plans would lie around them in financial ruins?

The excellent campaign run by Women Against State Pension Inequality calling on the Government to make fair transitional state pension arrangements for 1950s-born women is one that we in the SNP fully support in the interests of natural justice. Fairness is all that is being called for here today. I take exception to what the hon. Member for Gloucester said about the cost being £30 billion. I will challenge anyone who makes that case. Is it more worthwhile to fund weapons of mass destruction or to ensure that our people have dignity as they approach pension age? The Government have not listened to our calls so far. They have avoided and obfuscated.

Oral Answers to Questions

Alan Brown Excerpts

Tuesday 26th January 2016 Commons Chamber

[Andrew Selous]

I understand my hon. Friend’s proper interest in this subject. As the threat evolves, we evolve our response. I can tell her that we are strengthening the training for new prison officers to ensure that they are able to tackle criminal activity in whatever form it takes within prisons. As the Secretary of State said earlier, he has asked the Department to review its approach to dealing with Islamist extremism in prisons, and we await that report shortly.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

T5. It is worth repeating the damning indictment of this Government given by the Lord Chief Justice just two weeks ago:“Our system of justice has become unaffordable to most”.Will the Secretary of State take heed of those comments and also follow the Scottish National party lead by committing to the abolition of tribunal fees?

[Michael Gove]

I take very seriously everything that the Lord Chief Justice says, and that is why I am delighted to be able to work with him on a programme of courts reform, which should make access to justice swifter, more certain and cheaper. Of course it is important that we learn from different jurisdictions, but even as we look to Scotland from time to time to see what we can learn from the development of the law there, it is also important that from time to time those charged with what happens in Scottish courts should look at the tradition of English justice, which, as a Scotsman myself, I would have to acknowledge has certain superior elements.

State Pension Age (Women)

Alan Brown Excerpts

Thursday 7th January 2016 Commons Chamber

[Neil Gray]

rose—

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

rose—

[Richard Graham]

A lot of people want to speak, so let me carry on for the moment.

The hon. Member for Paisley and Renfrewshire South was right to quote the previous Pensions Minister, Steve Webb, as saying that not everyone knew about this. He has accepted that, as I think we all recognise. None the less, the argument that no transitional arrangements were made—arrangements that Opposition Members are calling for—is wrong. A significant transitional arrangement and concession was made in 2011 that affected 250,000 people and cost the Government—the taxpayer—£1.3 billion, which was a significant amount of money at the time. That arrangement was made because the then Pensions Minister and the then Government recognised advice from the Department saying that the waiting time for some women born in the 1950s had increased to as much as two years, and they wanted to reduce it to 18 months to benefit those 250,000 people.

What is interesting is that while the motion calls for further transitional arrangements, it does not spell out, nor has any Member who has spoken so far spelt out, exactly what transitional arrangements are being called for. Were the intention—

--- Later in debate ---

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

I want to pay tribute to the WASPI campaigning group, a group of non-political women who have come together to demonstrate and raise awareness of the serious issues involved. They had to resort to freedom-of-information requests to hold Government Departments to account, and these demonstrated the lack of communication about the Pensions Act 1995. What that group said, what we have heard today and what we hear from our constituents is how the combination of the 1995 and 2011 Pensions Acts is shattering people’s lives.

Some women have spent their whole lives planning to retire at 60 and they now find that they might have to work an extra five or six years. Nobody here can imagine the impact and the stress that this could wreak on family life. Some women have already retired on the basis that they would have enough income to get by until they reached what they thought was going to be the state pension age of 60. These include women who have been out of the workplace for up to five years and now find themselves in the position of having to find employment again. This is difficult enough when they have been out of the workplace, but it is further compounded by the austerity measures in the public sector. Some of these women had financial advisers and took early retirement, but their advisers did not tell them about the impact of the 1995 Act.

One of my constituents was made redundant from the civil service, which allowed her to care for her husband, who has now sadly passed away. Now she has discovered that she needs to get back in the workplace for a further five years. How is she going to do that at the age of 60, bearing in mind that only 34% of women in the 60 to 64 age range are economically active? Another constituent has been lucky enough to get back into work, but she feels that having to pay national insurance again while she is working these extra years rubs salt in the wounds. Another constituent, Jan Buchanan, simply says she has been robbed of over £30,000.

Another aspect of the excellent information gathered by the WASPI group is its submission and recommendations on how the Government should communicate with people in future about their pensions and how to make financial information and its impact clearer. I recommend that the Government take that on board.

We have heard that the previous Pensions Minister now admits that acceleration in 2011 was a mistake, but he has taken the easy option of blaming the civil service and the Tories. I do not think that is acceptable either. Two months ago, the Chancellor found £27 billion pounds and as we have already heard, money could be found for bombing Syria and £5 billion has already been wasted on the development of the future Trident programme.

This Government continue to tell us that they take pride in being able to take tough decisions. We will give them an open goal and an easy decision—they should change their minds on the transitional arrangements and help these people whose lives have potentially been ruined.

State Pension Age Equalisation

Alan Brown Excerpts

Wednesday 2nd December 2015 Westminster Hall

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Davies. Like others, I thank the hon. Member for Worsley and Eccles South (Barbara Keeley) for raising this important matter. The turnout in the Chamber reflects its importance.

This issue was first highlighted to me in my first surgery by a constituent who is very active with the campaign group WASPI. I pay tribute to WASPI for highlighting these concerns. Since then, I have been contacted by many other constituents. It is abundantly clear that many women were not properly informed about the Pensions Act 1995. This injustice was not caused just by the Pensions Act 2011; it was compounded by the Department for Work and Pensions’ earlier mistakes. Like others, I have constituents who face a delay in reaching the state pension age not of two years, but of what they feel is a six-year whammy, which clearly causes a lot of emotional distress.

I talk about the 1995 Act because it illustrates the seriousness of the predicament that many women face. They plan to retire at a certain age and work all their lives with that goal in mind, but at the last minute that is taken away from them and they are left with hard choices. Do they work longer, do they use their savings or do they use the pensions flexibilities to retire when they originally planned?

It is clear that this is another tax credit-type issue for the Government. The figures and numbers look good on paper, but behind the statistics are the personal stories of the people—in particular, women—who are affected by the legislation. Like tax credits, it is clear even in this Chamber that this is becoming a cross-party issue. The Government should take heed of it, and not continue to put their head in the sand.

The 2011 Act breached the Department’s guidelines, which state that increases should have a 10-year lead-in or warning. That lead-in period was halved in the 2011 Act for most of the people it affected. People of both sexes, but perhaps more women, were affected by the economic crisis and the 2008-09 recession. For many people at that time, early retirement seemed like the right thing to do, but they now have to wait longer to reach to state pension age. They thought they were doing the right thing. They planned and felt comfortable, but they face potential financial hardship and emotional distress. A crumb of comfort for those who live in Scotland is that the Scottish Government’s policy on bus passes and free prescriptions means that our constituents are slightly insulated. They are not affected by the state pension increase.

I am sure that the Minister will tell us that the Government are looking after pensioners with the triple-lock system and the new single-tier pensions. But believe me, that is of no comfort to the 5 million people affected by the 2011 Act, and in particular to women born in the critical period in the early 1950s.

The last-minute changes to the 2011 Act cost an estimated £1 billion. Considering the surplus that we hear the Chancellor has got, I suggest that another few billion pounds would not go amiss in rectifying this wrong. I strongly urge the Minister to look at concessional arrangements for the future.