Welfare Reform Bill

Debate between Eilidh Whiteford and Jenny Willott

Wednesday 1st February 2012 Commons Chamber

[Jenny Willott]

Returning to the issue of the time-limited employment and support allowance, there is real concern about an arbitrary time limit. As was kindly pointed out by the right hon. Member for East Ham (Stephen Timms), at a party conference the Liberal Democrats showed their concern by passing a motion against arbitrary time limits. However, the amendment from the Lords and the Government’s original proposal both set arbitrary time limits; it is just that one is longer than the other. Neither of the options in front of us would get rid of an arbitrary time limit, as a number of Members have highlighted.

One way to make the system less arbitrary is to ensure that people are in the right category in the first place, with those in the greatest need in the support group, so that they are not affected by a time limit. My colleagues and I have looked long and hard at the issue, and the important thing is to get the assessment right in the first place and make sure that people are in the right category, as those in the support group are exempt from the time limit. We need to make sure that people who need long-term, indefinite support are in the support group and can get that. That is a more effective way to protect those who need the most help than changing one arbitrary time limit for another.

[Dr Whiteford]

I share the hon. Lady’s concern about getting the test right in the first place, but is she confident that the work capability assessment is working as it should?

[Jenny Willott]

I was going to come on to that. If the hon. Lady will bear with me, I will hopefully answer her question.

--- Later in debate ---

[Jenny Willott]

I will make some progress, because I have hardly said anything yet, and I am being intervened on left, right, and centre.

The Harrington process is critical to getting the assessment right. I welcome the work that has been done looking specifically at cancer patients, which will ensure that the vast majority go into the support group. That is the right way forward. I also welcome the fact that Professor Harrington is looking at how we assess chronic pain and fatigue, because in many chronic, long-term conditions—particularly fluctuating conditions—those are the elements that cause people most difficulty in thinking about returning to work, and the elements that, at the moment, the work capability assessment is not very good at identifying and reflecting. I really hope that Ministers will implement whatever recommendations Professor Harrington makes on those issues; on past experience, his recommendations have been sensible and have made a significant difference to the assessment.

On the point made by the hon. Member for Banff and Buchan, there is evidence that the system is improving. I looked earlier today at the latest figures on the outcome of the work capability assessments, which I found quite reassuring when it comes to the Bill. We have to treat the figures with caution, but they show that initially, following the work capability assessment, more people are going into the support group than the work-related activity group. That is a crucial point. If we are getting the assessment right, and more people are going into the support group in the first place, the time-limit for people in the work-related activity group becomes less of an issue, because the people who need the most care are getting support indefinitely.

[Dr Whiteford]

My concern remains that far too many people are having to appeal against their work capability assessment result, and those appeals are overturning the original decision, so the system really is not working as well as it should.

[Jenny Willott]

I understand the hon. Lady’s concern, and the issue has been raised over a number of years by those on both sides of the House.

Social Security

Debate between Eilidh Whiteford and Jenny Willott

Thursday 17th February 2011 Commons Chamber

[Jenny Willott]

I shall clarify my remarks in case anyone misunderstood me. I said that we will not be debating complicated uprating changes every year. Clearly, there will still be a debate every year, I assume, on the uprating of benefits; I should hate to think they will be frozen in future. I shall talk about pensions later in my remarks.

According to the Institute for Fiscal Studies, the universal credit will mean that 2.5 million families will be better off. They will get more money, which will in time help to reduce the total benefit bill by making it more worthwhile for people to get work and remain in work and off benefits. That should generate support on both sides of the House, as it is something we all want families to do.

As well as an improvement in prospects for those on working-age benefits, as the Minister said, this morning the Government introduced changes that will make a significant difference to pensioner incomes. The level of pensioner poverty in the UK is a complete disgrace in a civilised country. During the shadow Minister’s remarks, it slightly got me that he seemed to criticise the Government for not sticking to the CPI increase for pensions and going for a larger increase in pensions this year. In 2000, the previous Government were happy to see an increase of only 75p in the state pension, which most of us found stingy, measly and completely unforgiveable. At least, this Government are tackling pensioner poverty and are willing to do something serious about it.

Labour’s efforts to lift older members of society out of poverty resulted in a massively complicated, overly bureaucratic system based on means-tested benefits that has left 2 million pensioners still living below the poverty line. Clearly there is something wrong with the current system, so I am delighted that real progress is being made to safeguard the value of the basic state pension. Current pensioners will now be protected by the triple lock, which is welcome. I am delighted that a Liberal Democrat manifesto commitment is being implemented by the Liberal Democrats in government. What we promised we have delivered, and the state pension will increase by earnings, 2.5% or CPI, whichever is greatest. People over the age of retirement will have the protection they deserve. As the Minister said, the amount can be quite significant. We are talking about £15,000 over a person’s lifetime, which will make a significant difference for a large number of pensioners and will, I hope, have an impact on pensioner poverty.

I am glad to see that change. However, I believe that we are still building up problems for future generations of pensioners. Current pensioners’ circumstances will improve significantly, but the ticking pension’s time bomb was not tackled by the Labour Government or by previous Governments. I would like the current Government to take the bull by the horns and ensure that we do not end up with a problem in decades to come. Far too many people are not saving for retirement. Auto-enrolment will help in that regard, but people need to know that it will pay to save. We must reduce the amount of means-testing to ensure that people know that, if they save while they are working, it will benefit them in retirement.

We have an uncertain jobs market. There are no more jobs for life. Occupational pension schemes are closing at a terrifying rate. Many occupational schemes are defined-contribution, rather than defined-benefit, and far less generous. Even with the triple lock, problems will increase. I would be grateful if the Minister told us what the Government plan to do in the long term to tackle the time bomb. The triple lock will make a significant difference, but we need to look at the whole pension system to ensure that we reform it in decades to come so that it is more appropriate to the needs of society.

Clearly, a big issue is the move from RPI to CPI. I understand why people are concerned about that, but I say to pensioners who are worried about the impact on their basic state pensions that they will be protected by the triple lock. As the Minister made clear, the majority of people on public sector pensions will be protected from a potential reduction in their long-term benefits by the triple lock on the state pension, so they will end up better off in the long term. The impact on people will not be as great as many Opposition Members have said it will be.

I can see that benefits come with the change to CPI. It is more stable. It means that we will not face issues such as the one that arose last year when benefits were frozen, which caused significant hardship for many millions of people. CPI is also a more appropriate system as 70% of pensioners own their homes outright. As the Minister said, there is a negative impact for those pensioners as the rate of mortgage interest is taken into account under RPI. They do not benefit in any way from the massive fluctuations that that can generate in their pension increase.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

One of the big concerns is that the Royal Statistical Society has said that the CPI is not a good measure for pension inflation. The differential impact of that measure is causing many Opposition Members concern.

[Jenny Willott]

I thank the hon. Lady for her comment. The issue is likely to be taken up by the Minister in his summing-up because, from his comments from a sedentary position, he seemed to disagree with similar comments by the shadow Minister. I do not have a copy of the whole quote in front of me, but I am sure that he will be able to fill the House in on that and respond to her question later.