Welfare Reform Bill

Baroness Howe of Idlicote Excerpts

Tuesday 4th October 2011 Grand Committee

[The Earl of Listowel]

My Lords, I would like to join my thanks to those made this afternoon, and to speak briefly about the importance of involving employers, about the governance of Jobcentre Plus, and briefly about housing.

I thank the Minister for the help of the civil servants. There were a number of very helpful briefing meetings which were most welcome, and I am sure this will continue.

The noble Lord, Lord Kirkwood, raised the issue of involving employers, and if I might I will give an example of how effective that can be in terms of reaching the most hard to reach people out there.

There is a programme, started by the National Grid utility about 10 years ago, led by their chairman, Sir John Parker, which employs young people from within the criminal justice system, and has reduced the reoffending rates among those young people from 70 per cent to below 7 per cent. National Grid has brought in a number of other partners, such as the engineering firm Skanska and another engineering firm Morrisons, and other businesses have been joining in such as software businesses. Because this has come from businesses they have been able to build trust among other employees, and while it would seem most unlikely that many of these companies would wish to employ people from the criminal justice system, in fact they found that because they have made the effort to recruit these young men—they have given them the training and the promise of employing them if they complete the training—those young men have become loyal employees, and have actually risen quickly up the managerial ladders of these companies. They are filling a gap, because these companies have an aging workforce and they need young people to enter their firms.

That is a very important point, and it brings me again to think about whether employers are firmly enough plugged in to the governance of Jobcentre Plus. I hope to table an amendment later in the Bill which will look at how one might perhaps involve more of the stakeholders in the running of Jobcentre Plus. I will not expand too much on this now, but if you look at the example of the Youth Justice Board, which has proved so successful since its introduction about 10 years ago you will see that, its chairman is a former chief executive of a local authority, so she can go to chief executives and directors of children’s services in local authorities and explain to them how important it is that they provide employment and find housing for young people who leave young offender institutions if they are not to reoffend, cost the taxpayer huge sums of money, and ruin their own lives. So I will bring that amendment later.

I am certainly very concerned about housing, but I am grateful for the signals from the Government, who listen very carefully to concerns, and I look forward to that debate. I will sit down at this point, but I am very grateful to the noble Lord, Lord Kirkwood, for allowing this opportunity for a broader debate at the beginning of the Bill.

[Baroness Howe of Idlicote]

My Lords, I shall comment briefly on a couple of the speeches that have been made. The way the noble Lord, Lord Kirkwood, introduced the whole of this absolutely explained my frustration and irritation at the short amount of time any of us have been given to do anything at all with this Bill. The noble Lord’s hard look at the use of language was very illustrative too, and that has of course been added to as far as things like social tax are concerned and other points that have already been made.

Above all, I hope that it will help us, because the atmosphere has not been particularly good regarding the whole of the way in which this has been arrived at between the usual channels. To have a little debate like this, setting the scene, will I hope influence how we all approach what we are going to be dealing with. I will leave it at that, but I have been very impressed, let me put it like that, particularly by what the noble Lord, Lord Kirkwood has said, and by the way he set the scene for the opening.

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[Lord Freud]

I thank the noble Baroness, Lady Meacher, for that. I am at a slight loss at how to respond, in case it is an “Am I beating my wife?” question. I am getting some help from the Box. The universal credit will be built on a computer system, or rather a pair of medium-sized computer systems. We have a careful introduction process. One of the options we had, if I can explain it in layman’s terms, was that we could have picked everyone up electronically out of current systems, moved them over and dropped them into the universal credit, with effectively a Big Bang approach—go for it.

That would have been the conceptual framework in which the noble Baroness asked her question. We are not doing that. We are moving people into the system over an extended period. We will start with the flow in October 2013, and then as we get the system working we will have some managed migrations over a four-year period. It is not the Big Bang approach—where you wait for the thing to go, and then you throw everyone in—that one might envisage. It is a much more considered, steady, incremental approach. Indeed, we are developing the actual IT by using elements and units of what we have much more incrementally than it might seem from outside. That is one of the things that I will try to show noble Lords when we have the presentation; indeed, it will be a wider presentation for all parliamentarians. I see that a few in the Room may be very interested.

[Baroness Howe of Idlicote]

I am trying to visualise in my mind what you are doing with your groups. What worries me is the older group, who may not be quite as alert to the modern methods of IT and may find it not as easy to move around and get the right information via an IT system. It would be helpful if you could answer that point, or take it into account when setting up your demonstration.

[Lord Freud]

Yes. Picking up on that point from the noble Baroness, Lady Howe, one of the most complicated areas in practice is not the development of the IT system; it is the interface between the user and that system. We must develop, and are developing, a sophisticated set of gateways. There are a lot of issues to get right surrounding identity assurance, ease of use—which we are doing a lot of work on—and where you go to get access when you do not have broadband in your home or do not necessarily understand how to use programs. Getting that help right and balanced is something that we are spending a lot of time and energy on. I accept the noble Baroness’s point: that is one of the key issues to get right.

Welfare Reform Bill

Baroness Howe of Idlicote Excerpts

Tuesday 13th September 2011 Lords Chamber

[Baroness Howe of Idlicote]

My Lords, I join the noble Lord, Lord Kirkwood, in his concern that the traditional practice of reasonably sized contributions from noble Lords has once again been put aside and a meagre seven minutes advisory per speaker suggested in its place. I notice that he has gone well over that time limit, which gives us plenty of opportunity to follow his example. There will clearly be a great deal to do in Committee and at other stages of the Bill in your Lordships’ House—not least as much of the Bill was apparently not discussed at all during its passage in the other place.

Perhaps the most remarkable thing about this Bill, with its principal aim of simplifying benefits and making work more attractive and much more worth while than living on benefits, is that practically all welfare rights pressure groups, think tanks and involved charities and many individuals are theoretically in favour of such an approach. Rightly so, as who would want a system which continues to encourage family dependency if jobs are genuinely available and wanted?

The snags emerge when we begin to look at the detail, particularly when families and children—even more important, when disabled adults and children and those with mental health learning difficulties—are involved. The closer one examines the huge volume of evidence, including many individual histories written in fairly despairing terms, the more obvious it becomes that the most vulnerable and least able to cope will be hardest hit. Even though there may have been some unnecessary scaremongering, the concern of many third-sector organisations and others working with such families will be to hear reassurance from Ministers as to how clearly essential and necessary support will be maintained. There is also the problem that unless the local authority finance for these essential services is to be ring-fenced, a localism approach may indeed be creating a postcode lottery.

I shall mention one or two issues. On housing for example, the plan to require those in receipt of public support to move to different accommodation if they have an unused bedroom is one concern. The noble Baroness, Lady Wilkins, overwhelmingly made the case here. Reassurance from Ministers will be needed that special arrangements will be possible or extra funding available for more expensive accommodation, if the private sector is the only alternative to a compulsory move. One worry is the understanding that the severe disability premium is to be scrapped, yet surely that kind of situation is exactly where extra help is essential. This may be one of the areas being looked at, but the Children's Society’s view is that it could mean a loss of up to £2,876 per annum for such families.

There is also a need to look at other issues that will affect the likelihood of those with caring responsibilities obtaining a job and at the effect of recent positive measures. It is good news indeed, for example, that the Government are actively involving and encouraging third-sector participation, not least by ensuring that when both sectors are competing for caring contracts, the system does not allow the public sector a tax advantage.

The change in the retirement and pension age will also have a huge impact. As we know, Ministers are eager to raise the retirement age even earlier, but closing the gap between men’s and women’s retirement age also means that women must work longer and therefore will have less time for any caring role. Finding jobs that will allow time for disabled caring responsibilities will become increasingly difficult unless more positive action is taken. Have the Government, for example, thought about a scheme that would reward businesses that make special efforts to provide flexible working opportunities for such families? I would be glad of an answer from the Minister.

Again, frankly, the likelihood of older women, whether carers or not, being able to find jobs, full or part-time, into the intermediate economic future will be minimal, and that situation needs facing. Barnardo’s and its associates, which have sent your Lordships detailed briefings, are also concerned about a number of problems. Family and friend carers, for example, who are bringing up a child who would otherwise be in local authority care, should, they think, be exempted from conditionality requirements under universal credit for a year. Also, from October 2011 carers will have to be available to work when the child is five rather than seven years old, with all that that means for extra childcare costs. Childcare costs, as the Minister knows, are seen as a major obstacle to women working. So, as the Bill progresses, it will be increasingly important for the Government to convince voluntary organisations and family and friend carers that the combination of their proposed changes will not result in even higher numbers of children in care and higher overall costs for the state.

I make one final point: there will be a great need to ensure that it is the main carer of the child, the vast majority of whom will be women, who will continue to receive whatever allowance is due to the family. This is an issue of particular concern for Platform 51 and other such organisations and is vitally important when one looks back to the past and realises that this sum has often been the only money the carer has had in order to ensure that the family is fed.

Pensions Bill [HL]

Baroness Howe of Idlicote Excerpts

Wednesday 27th April 2011 Lords Chamber

[Lord Boswell of Aynho]

My Lords, I congratulate the noble Baroness, Lady Hollis of Heigham, on her ingenuity in inserting this into the delicate business of amendments at Third Reading, of which I have, with modesty, rather less experience than her. I also associate myself with the spirit of her intentions in this matter at least in two respects.

First, many of us across the House felt some dissatisfaction or sadness that we were not able to resolve some of the issues of rough justice connected with the bunching of women's pensions. While I appreciate that we cannot reopen that in this House now, that area might repay further consideration. I have seen some correspondence subsequent to our debates on Report which would have suggested, for example, that a minor adjustment in the entitlement for the male pension above the age of 65 might be a way to finance a smoother progression for women without a net cost to the Treasury. I hope that Ministers have not shut their minds to this area, although I appreciate that it is difficult and that there will always be losers as well as gainers. However, it would be inappropriate to go further into that.

Perhaps I would be on more confident and more positive ground in saying, secondly, that I share the noble Baroness's enthusiasm for the single state pension, which I believe would be a considerable social advance. It would help to make pensions and saving for them, including private pensions and NEST, worth while. That must be an objective for us all. It would also be an important advance in simplifying the system. We could not discuss this previously because of the timings of government proposals and I appreciate that pensions' evolution and development is an incremental business. However, I would like to share with the House some considerations which the Minister, even if he does not consent to a formal review—I know that those things are not easy for Ministers to do—may at least wish to ponder in moving through the consultation process on the state second pension and in looking at the interaction with NEST.

With due respect to the noble Baroness, I will not confine my remarks specifically to women's issues because some wider issues are also appropriate to consider. First, it is in the nature of pensions, particularly where they are guaranteed or organised by the state, to reflect long-term commitments. Any mid-term corrective action, even if benignly intended—and this is so—may therefore inevitably subvert arrangements which have already been made. I cite as an example that when we reduced the qualifying years to 30, with a view to trying to do something about women's pensions in the past, it had the converse disadvantage of nullifying the benefits of some individuals who had made contributions above that period in order to safeguard their entitlement, on the rules as they stood and in good faith.

At the same time, if we moved to a single state pension, I would find it personally important to retain an element of the contributory principle. Again, a post-Bill development, as it were, has been the issue of whether there should be some association either of administration or even of coverage between the tax and national insurance systems. Paying for something and getting something back is both morally and prudentially wise, although there is a huge amount of further work to do on that area. There are also potential differential impacts, as the noble Baroness has already touched on, from the change not just on women but for those with interrupted or overlapping working patterns. For example, there are people who have spent time abroad or who may have saved for a private second pension at different times. All that is complicated and requires a good deal of careful thinking through.

At some stage—the Minister can help us by giving some indication of this—we need therefore to take a dispassionate and careful look at all aspects of the proposed changes as they now come out. This should be designed to minimise any retrospective unfairness and to look prospectively to minimise any moral hazard, where people may feel that they lose when they have acted in good faith; but remembering at all times as we do that—and pursue the hard cases, which we must—that there is a grand prize to follow in simplicity and in providing a good platform for additional, personal private saving. That must be our overriding objective.

[Baroness Howe of Idlicote]

My Lords, I congratulate the noble Baroness on her amendment, which shows us that there are very few people who know as much about pensions as the noble Baroness, Lady Hollis; we recognise her ingenuity, certainly, but above all her knowledge and her belief in getting the right and honourable thing for all pensioners. I too am extremely sad that we were not able to convince this House to amend the proposals affecting those women turning 57 in March and April this year who were going to be required to work an extra two years, a group of women who had far fewer opportunities for flexible working than women have today. I believe that an attempt in the other place will be made to return a more equitable answer to this problem, and I hope that it would be well received in this House. I too support the idea of the single state pension. It would go quite a long way towards a more equitable set-up for both men and women into the future. I would like to end by very much hoping that we will see a better outcome in many respects than we had first thought when looking at this Bill.

[Lord McKenzie of Luton]

My Lords, my noble friend Lady Hollis has been an initiator of thinking about, and a passionate advocate of, a single state pension for a number of years. She is truly a leader of the pack on this issue. As she explained, the nature of her amendment this afternoon is simply that it makes a request that the Secretary of State be required to lay a report before Parliament before the end of June 2016, which of course is the start of the timeframe for the acceleration of equalisation of the state pension age under the Bill. That would assess the consequences of the Bill on any proposals for the introduction of such a pension. This does not seem an unreasonable request.

From time to time during our consideration of this Bill, there have been references to proposals for a single-tier pension and the Minister acknowledged this himself at Report, when he referred to being challenged by his noble friend Lord German to say more about the single-tier pension. The Minister duly obliged by referring to a Green Paper, which was due to be published a few days later.

The Green Paper effectively consults on two propositions. One is accelerating the existing reforms so that the state pension evolves into a two-tier flat-rate structure more quickly; and the second, as my noble friend advocates, is a single-tier flat-rate pension set above the level of the pension credit standard minimum guarantee. The Green Paper, incidentally, also consults on proposals for automatically uprating the state pension age, but we are not focusing on that this afternoon. The consultation is just under way and not due to be completed until 24 June 2011. Which option, if any, the current Government wish to pursue may not emerge for a little while, but like all noble Lords who have spoken I will be interested to hear today’s thinking. Indeed, we as a party need to consider the outcome of this consultation, but see the thrust of the benefit of a single-tier flat-rate pension. A number of considerations will doubtless be brought to bear, particularly the voice of the Treasury. I think that it was the noble Lord, Lord Boswell, who made the point that we need to reflect on these in terms of long-term issues—pensions are about long-term issues—and, I suggest, of the need to drive consensus where we can. The Minister also referred to the contributory principle, and that is very much the same position that my noble friend is in, which is why she prefers the single state pension to a universal pension that would not rely on such provision.

Pensions Bill [HL]

Baroness Howe of Idlicote Excerpts

Wednesday 30th March 2011 Lords Chamber

[Lord McKenzie of Luton]

I shall speak also to the other amendments in the group. Their detail may appear a little intricate, but their effect should be clear and straightforward. The amendments provide for the retention of the existing timetable for the equalisation of state pension age of men and women at age 65, but to bring forward the increase in the state pension age to 66 for both, in stages, between 2020 and 2022. Noble Lords will be aware that the Pensions Act 1995 provides for the gradual rise of women's state pension age from 60 to 65 over a 10-year period from 2010 to 2020. Also, as part of what we might call the Turner settlement and to pay for re-linking the basic state pension to earnings, the Pensions Act 2007 provided for the SPA to increase to 66 between 2024 and 2026, and then to 67 and 68 in the subsequent two decades.

The Bill also brings forward the increase in the state pension age to 66, but it would be completed between November 2018 and April 2020. Because the increase for men cannot run ahead of women's state pension age, the Government have put themselves in a position where they have to accelerate the date for equalisation of the SPA to November 2018, thereby disturbing the settled timetable of the 1995 Act. The Government propose to move to a state pension age for women of 65 by November 2018, rather than March 2020. The acceleration for that begins in May 2016. Between November 2018 and March 2020, the state pension age will rise for both men and women to 66.

What the Government seek to do is a clear breach of the coalition agreement, which committed that the state pension age for women would not start to rise to 66 until 2020. Had it been honoured, we could have reached a consensus on the way forward. Our amendments accept an acceleration of the move to a state pension age of 66, bringing it forward four years from the current timetable, but because that does not need to start until 2020, when men and women will each have a state pension age of 65, there is no need to change and no justification for changing the 1995 provisions.

The Government’s proposals affect nearly 5 million people, about 2.6 million of them women. Of those 2.6 million, 1.5 million women will have to wait a year longer for their pension, of which 500,000 will have to wait more than a year, including 300,000 for more than 18 months and 33,000 for exactly two years. Those first affected will have just five years’ notice. Our amendments would affect 1.2 million fewer people; they would affect approximately equal numbers of men and women; and no one would have to wait more than an extra year for their pension. There would be a minimum of nine years’ notice for all those whose state pension age will change.

Before expanding on our reasons for that proposition, let me reiterate, as I said in Committee, that we do not dispute the updated information concerning life expectancy and the need to change the status quo. We further recognise that the current timetable for increasing the state pension age to 67 and 68 is unlikely to survive. Whether the Chancellor's wish for a more automatic process to update that will achieve a consensus will depend on what view is taken of such matters as fair notice periods and health inequalities.

It is also accepted that our amendment would achieve only two-thirds of the savings that the Government hope to secure by drawing the line where they have. Our proposition is the same as option 2 in the impact assessment. We will hear from the Government, as we did in Committee, that we cannot forgo the difference of some £11 billion in DWP savings, but let us put this in context. This is a net present value, not an annual figure. The DWP savings forgone on our proposition are spread over about five years and do not exceed £1 billion until 2018-19, with the differential between the two propositions disappearing in 2022-23. These are not small sums, but need to be seen in the context of a GDP which might then be some £2 trillion with annual spending on pensions and benefits of £100 billion a year. The timing of the savings is outside the Government’s deficit reduction plan. The savings are all outside this Parliament and significantly outside the one that follows.

One cannot ignore the medium or long term, particularly on pensions, but intergenerational judgments also involve assessing who is to bear the pain now. Savings to the Government and future taxpayers are pensions forgone by the 5 million individuals, the majority of them women, who are hit by these proposals. If intergenerational issues are to be judged on the basis of the number of years in receipt of state pension or the proportion of adult life spent in receipt of state pension, the impact assessment shows little difference between the Government’s position and our amendment.

We contend that any changes to state pension age have to be reasonable and fair and should not disadvantage any group disproportionately. The Government’s proposals fail this test. Women’s pension age is rising by up to two years; no man will see more than a one-year rise. Some women are being given six years’ notice of a two-year change; men are being given seven years’ notice of a one-year increase. Forty per cent of women in the age group affected by these proposals have no private pension wealth. Many who were part-time workers were excluded from occupational pension schemes until the 1990s. Women’s pension assets are only one-tenth of those of men. Women are more likely to take on caring responsibilities and to have reduced their hours of work or left the labour market on the expectation of a pension at a fixed date. Just on these issues, it is difficult to see that they have not been disproportionately disadvantaged by the Bill.

Of course, it is not possible to redress all the historic disadvantages women have endured in pension provision, but reasonable notice periods for changes to the state pension age is clearly one way of allowing maximum time to adjust. The 1995 Act gave 15 years’ notice. The 2007 Act gave 17 years’ notice. This Bill gives five years’ notice. What is reasonable notice can be judged in part by looking at attachment to the labour market. Analysis shows that women tend to leave the labour market earlier than men. In 2010, 65 per cent of women aged 55 to 59 were still economically active, but by age 60 to 64 this declined to 34 per cent. If individuals are to be able to respond to changes to their economic circumstances caused by a deferral of their pension, they need to know before they make irrevocable decisions about their employment. This assumes that individuals are in a position to mitigate their pension loss by continuing in or rejoining the labour market. We know this is more difficult for some than for others. The impact assessment suggests that ethnic minority groups in particular will be adversely affected. Analysis shows that notice for men should be at least five years and, ideally, 10 years, and for women it should clearly not be less. It will be noted that even our amendment offers only nine years, which is just on the cusp of what should be acceptable.

The Government are right to address the consequences of increasing life expectancy. The much-lauded triple lock has to be paid for, but the Government have gone about it in the wrong way and will cause great unfairness, particularly to women. This group of amendments offers a fairer alternative. I beg to move.

[Baroness Howe of Idlicote]

My Lords, first, I apologise to the House that due to a previous commitment I was not present to support the amendment of the noble Lord, Lord McKenzie, in Committee.

As other noble Lords have said, there are a number of changes which we welcome, not least that auto-enrolment into occupational pensions will in future help more people to save for retirement. However, as we all know, both from individual letters we have received and from organisations such as Age UK, Saga, the TUC and others, considerable numbers of women are very concerned. A total of some 2.6 million women are affected by all this, and they are very concerned at the Government’s proposed acceleration of the state retirement age. To be fair, they had certainly not expected such a step.

I am sure it will not surprise the House to learn that I want to concentrate on the adverse effect that some of the Bill’s proposals will have on women, particularly on those turning 57 in March and April this year who will now have to wait until they reach 66 to receive the state pension they have contributed to during their working lives. They have had less than eight years’ notice of an additional two years without that state pension. Equally, we need, as the noble Lord has already said, to face two realities: first, that our parlous economic situation will inevitably reduce everybody’s quality of life, and secondly, the realisation that our increasing longevity means that all of us will in future have to work longer to earn a decent state retirement pension. However, we shall as well be seeing—I hope, as finance improves—far more effective equal opportunity practices available at all workplace levels for both sexes, which should mean that men as well as women can genuinely share rather more of the family responsibilities. That in particular is why I want to support the noble Lord’s amendments, for it seems to me that they have indeed faced these realities. On economic as well as longevity grounds, they do not ask for the full commitment which the coalition Government’s agreement promised to give to women to be fully honoured, but merely for a slight increase in what the Government themselves propose. For that reason, I really hope that when the Minister replies he will feel able to accept that compromise.

I have to admit that my own preference would be for the commitment to be fully honoured. In my early days as deputy chairman of the Equal Opportunities Commission in the 1970s, pensions were not even perceived as pay. I am glad to say that that situation was very soon seen to be untenable.

I return to what is proposed. A total of some 2.6 million women are affected. Of those, 33,000 women born in the 1953-54 period will see their state pension age increased by at least 18 months. It is estimated that those women will lose around £10,000. We need to remember, too, that when these women were first in the workforce, there were far fewer and far less well-paid jobs available to them than there are in today’s world, especially when they needed to work part-time or flexibly when children or other family members needed care. Two different illustrative figures bring this home very starkly. Women retiring in 2009-10 had on average a state pension of £92 compared with the average male state pension of £124. For those who were lucky enough to be involved in private pensions, an average man’s private occupational savings when aged 56 were £53,000 or nearby, which is no less than six times higher than the woman’s average total of £9,000.

When we consider the just and fair thing to do in this situation, we all need to accept who bore the responsibility for bringing up the generation of healthy, well adjusted young people who are today those responsible for paying our state pension entitlement. We also have to remember that none of the savings that the Government claim to be making will be made during this period of major financial crisis. So why victimise this already exceedingly vulnerable group of women—the poorer they are, the more they will suffer—when no actual money will be saved during this Parliament and not least when, realistically, the likelihood of women in this age group finding or keeping jobs is minimal?

If you add to all that the fact that, in our move towards a unisex retirement age—it is likely to be further increased as our longevity increases—we are asking women to increase their current earlier retirement age by a huge leap of six years compared to the one year expected of men, which was lower than that of men to compensate for the handicap of women in the workplace as a result of their family responsibilities, frankly, we should all be ashamed of doing anything less than what is proposed in these amendments.

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[Lord Boswell of Aynho]

I am grateful to the noble Baroness, Lady Greengross, for moving her amendment, which is cognate with one that I moved in Committee. I have to say I was somewhat shaken by the Minister’s response because I do not normally go around as a fiscal incontinent. However, I accept the reproof of the noble Lord, Lord McKenzie of Luton, at my loose speech in my previous intervention on this issue when I quoted his cost at £10 billion per annum. That is of course a net present-value cost, and my cost, if I may call it that, is £7 billion per annum. Unless I have misread the amendment, the noble Baroness’s cost is very slightly more generous than mine would have been.

These are big sums but my point earlier, which I wish to talk about now, is that in making a macroadjustment—which I believe is essential and for which I established a case on which we have just triumphed—there is nevertheless a very real problem for individuals. I should say, if there is any doubt, that I have a certain background, if only because I have a household that is 80 per cent female, or was before my daughters grew up. I have no lack of sympathy with women’s issues and am well aware from the data that many women look forward to a less than generous pension and have not had an opportunity to build up the entitlement that some men have. Those are the data. We are gradually, by degrees, achieving social advance.

There is now a suggestion that, in dealing with the major problem that we have to address, we may be affecting a particular group of women very hard. We have to answer the question of how we deal with it. In terms of the overall cost of a grand architectural amendment, I can see that that would be very substantial indeed, which, as I have already indicated to your Lordships’ House, might well fall on taxpayers and the active working population of today—our children and our grandchildren. That would have adverse consequences. We have to find ways other than that of dealing with it. It is possible that one could make some slight adjustments within the system by flexing the exact provisions of the Ministers or the proposals of the Government or the proposals of the noble Baroness, Lady Greengross, thereby sharing the cost between the various women who would otherwise be affected.

My concern, and it is a paradox, is that with the best intentions, as the Minister explained to us painstakingly in Committee, the equal treatment directive—I do not dislike the equal treatment of women and I do not as a matter of fact dislike the European Community—constrains us on sharing the burden with men, unless and until we have caught up to the common age of 65. The present arrangements are a derogation from equal treatment until we reach that equality of pension age which is inhibiting this process.

One way forward, which has been touched on briefly in the earlier exchanges, may be to look at something beyond the pension age of 65, or even 66, as a compensating adjustment for burden-sharing. An alternative approach would be to go for a specific targeted scheme, but there are some difficulties even with the law on that if one were to have a differential pension credit arrangement. I have asked the Minister some Parliamentary Questions on that. The cost is much lower, but it is indeed setting up a special scheme to try to sort out the problems of individuals.

If we could have a system whereby nobody went without their pension for more than 12 months, as the noble Baroness suggested, or something like that, we could reasonably argue, given the timescale—not perfect, not ideal, we have all accepted that—that that is something with which people could accommodate themselves. A doubling of their loss, or a further acceleration of the timescale, would not be acceptable.

I urge the Minister to try to find some acceptable approach, or to signal some acceptable approach, which can, within the constraints that have been mentioned, help this group of women who are seriously and significantly affected, where there is a sense of unfairness, or of harsh treatment, without as it were destroying the intentions or the efficiency of the overall change which we need to make. I hope the Minister will consider that very seriously. It is not a matter of party politics. It is a matter of a common feeling that we should try to do something. I very much hope that, one way or another, through our combined wisdom, or at least our combined persistence, we will reach an acceptable solution.

[Baroness Howe of Idlicote]

My Lords, I congratulate the noble Lord, Lord McKenzie, on his amendment and I thank everyone for the very warm support that it got. Obviously, I would rather that amendment had won, but the vote was indeed very narrow. With that in mind, I would certainly want to support the proposal of my noble friend Lady Greengross, which would certainly do something along the lines that the noble Lord, Lord McKenzie, was trying to achieve with his amendment.

If the Minister can find a way to accept that, it will give some comfort at least to those who feel strongly—and have shown how strongly they feel—about this issue. I hope he will bear that in mind when he comes to reply.

[Baroness Grey-Thompson]

My Lords, I rise to speak to this amendment as someone who is certainly not an expert in pension provision; I admit to finding a lot of it rather confusing. The amendment tabled by the noble Baroness, Lady Greengross, is a very positive and useful way forward.

What concerns me is not the arguments that we heard earlier about the 2.6 million women having to wait longer than expected, the 330,000 who will have to wait 18 months or even the 33,000 who will have to wait two years to receive their pension, but the fact that, of the current pensioners who live in poverty, two-thirds are women. The Joseph Rowntree Foundation has made estimates about the poverty level, which it set at around £14,000 a year, and recognises that one in four women retiring today has less than £10,000 a year to live on. We know that women earn less pay on average, while taking time out to raise children means that they earn less over their lifetime. For me, though, the inequality in savings that women have access to is a stark reminder of where many women live today. The average savings in pension schemes of women between 51 and 59 are £37,000, compared to the £54,000 that men hold.

We have heard many case studies. I am very fortunate. I employ someone who is 56 and has a sister who is four years older. Maureen will have to wait 10 years beyond the age of her sister to receive her pension. This is someone who worked for a number of years, took time out to bring up a disabled child, went back into part-time work and, with nothing impelling her to contribute to a pension scheme, made decisions to try to save money but also had to recognise that there was a huge potential loss of salary in contributing to a personal pension scheme. I fear that we are going to alienate a large group of women and penalise them for making sound family choices to stay at home and bring up children and look after them.

It may be true that we need change and need to move on. It might be true that women have relied too heavily on their husbands’ careers and earnings in setting their pension limits, but I strongly believe that women deserve to have more time to adjust to this change in thinking.

Unemployment

Baroness Howe of Idlicote Excerpts

Wednesday 26th January 2011 Lords Chamber

[Lord Freud]

My Lords, I confirm that I am very worried about the situation in respect of NEETs, which is underlying and structural, as I said. We have now transformed the programmes to do something about it. We are introducing the work programme in the middle of this year, and we are also transforming the nature of provision in Jobcentre Plus, making it far more flexible and designed to look after people as individuals rather than in broad groups based on their benefit, as has been the case.

[Baroness Howe of Idlicote]

My Lords, given the Minister’s concentration on NEETs, which many of us would agree is entirely right, is there more that companies could do to encourage young people to come in part time but be trained at the same time? Can he say more about that?

[Lord Freud]

Yes, an effective strategy has to be built around employers, and we are doing quite a few things. The most important one was the introduction earlier this month of work experience. The idea is to give eight weeks’ work experience to young people aged between 18 and 21 who are not in university, while they continue to collect benefit. We are also looking to introduce later this year the academy programme, which combines work experience with elements of training to introduce people to work.

Poverty

Baroness Howe of Idlicote Excerpts

Tuesday 15th June 2010 Lords Chamber

[Baroness Howe of Idlicote]

My Lords, I too thank the noble Lord, Lord Kirkwood of Kirkhope, for his bright idea of initiating this one and a half hour debate. I shall not take up too much of your Lordships' time, but it is too tempting an opportunity to miss the chance to suggest a number of one’s pet priority areas, which I hope the Government may consider adopting in their important battle against poverty.

I am particularly glad that the coalition Government are to continue with the previous Government’s target to eliminate child poverty by 2020. We all know that targets can be overdone but this one is clearly sensible. The same applies to the commitment to continue with Sure Start as originally conceived. The right reverend Prelate mentioned that; it has done considerable invaluable work. I am a total fan of it. However, a major area I urge the Government to consider is further action to prioritise tackling what Keith Joseph 37 years ago called the cycle of deprivation. I wish to emphasise two specific ways in which that could be done.

The first is to ensure that children with special needs are identified early in their lives, so that the relevant extra support they need can be provided to help them fully develop their potential talents and skills for the benefit of themselves and their whole community. It would be even more beneficial if the Government could extend this form of assessment so that all children are assessed before they start their schooling. This, too, could save both money and misery in the long run. Incidentally, it is an area which many of us—particularly the noble Lord, Lord Elton, who is sadly not in his place—tried to get adopted in a recent education Bill.

My second point is more directly related to the important cycle of deprivation. The Government could undertake—I wish they would do so—an early assessment of potentially delinquent or deprived families with problems. To help identify such families, the Government's plan for more locally based midwives and health visitors will certainly help identify the back-up that may well be needed. Sadly, if prevention is not achieved, offending follows all too often and long-term costs go up considerably—very considerably indeed if a continual pattern of offending is established. Many of these young people who end up in prison have families with a history—often a long history—of parents, grandparents and generations even further back having criminal records. Of course, prison must be the answer for some heinous crimes, but increasingly we are realising that prison does not work for many offenders. Thousands of pounds are wasted each year by sending young offenders repeatedly to prison when they could, with sensible community sentences combined with professional and third-sector mentoring, be reclaimed for a civilised and worthwhile life. Thankfully, if one is to believe anything one reads in the paper, this appears also to be the view of the Justice Secretary, Kenneth Clarke, so perhaps we will see some action in that regard. I hope that the Government will seriously consider a complete rethink. We looked at this in a small committee of Cross-Benchers on penal policy on which I sit, and we all said that it was time to have another royal commission to rethink the whole of penal policy. That might be a thought.

I want to mention another poverty issue affecting us all that I hope the Government will also put on their priority list. A sensible aim of this Government, like their predecessor, is to ensure that welfare benefits go only to those who really need them, but equally it will be essential to give adequate help and retraining to those returning to work after long gaps. If that does not happen, it is obvious that greater poverty will resume. I hope that the Government can reassure your Lordships that sufficient support of this kind will be provided in these difficult times.

Another area of poverty which is unequally shared, yet could produce additional national and individual wealth, if readjusted, is the earnings of men and women. Much of this inequality is due to the assumed and actual caring roles of women, and despite equal opportunities legislation that gap still persists. Will the Government please consider making the right to request flexible working available equally to men and women? Perhaps more challenging would be the right to work either full-time or part-time on a flexible basis. We live in a global economy and work on a 24-hour international basis. Through internet technologies, we can all be constantly in touch with different parts of the world. All of us know that if we ring a company to make a complaint, the phone may well be answered by an employee living in India because it is cheaper for that company to employ—rightly or wrongly—someone living there.

However, if both sexes had such rights, there would be flexible benefits for companies struggling to survive in these harsh economic times, and that would give both sexes the time needed to care for their children, aged parents, disabled family members or friends. They could take a part-time course and stay in employment. There would be other benefits for women— often those who are most in poverty in retirement—because they would be more likely to stay in employment, to be available for selection for more senior posts, and, I hope, to retire on a better pension.

I hope that the Government will give those few thoughts—I am slightly under time—serious consideration.