Pensions Bill [Lords]

Julie Elliott Excerpts

Monday 20th June 2011 Commons Chamber

[Julie Elliott (Sunderland Central) (Lab)]

This debate is incredibly important to Members on both sides of the House. Before I move on to what most concerns me about the Bill, which has been raised by most hon. Members today, I should like to comment on some of the things that my right hon. Friend the Member for Croydon North (Malcolm Wicks) mentioned. My constituency’s past is in heavy industry, and it still has a huge element of industry. Both men and women work very hard in difficult, not-wonderful conditions. Many simply do not reach pensionable age. It is important to bear that in mind in our discussions. Nobody can argue with the statistics on the rate of increase of life expectancy, but in some areas of the country, especially in pockets within those areas, life expectancy is increasing much more slowly. That needs to be borne in mind in our considerations.

In my office, there are folders containing letters from many of my constituents who feel strongly about changes to their state pension age. Many have felt compelled to write to their MP for the first time. I want to speak on behalf of those people, who are predominantly women. They have told me what they think of the Government’s plans, and I promised that I would represent their views to the Government. I shall take this opportunity to raise their objections on their behalf. Some have told me extraordinary things about their lives, the jobs they have done and how hard they have worked. It is my privilege to speak on their behalf. Likewise, I was pleased to take part in a debate on this issue in Westminster Hall recently.

What are my constituents so unhappy about? These women have worked hard their entire lives and done everything right. They have worked, saved and planned. Along the way, many have raised families, and many now have caring responsibilities for younger and older members of their families—I could add that, in that way, they are saving the taxpayer money. They have made their contribution to society. They paid their taxes and national insurance in the hope of a happy, relaxed, financially secure and worry-free retirement, yet the Government have moved the goalposts. My constituents feel angry and let down. Many are afraid and wonder how they will manage financially. Those who must continue to work are fearful of the long-term implications for their health.

Before I go any further, I should like to make something clear. My constituents do not disagree that the state pension age should increase. They recognise that average life expectancy in this country is increasing and they recognise the dangers that come with an ageing society, but the Turner commission recommended 15 years of preparation before implementation, as a swift alteration could cause financial hardship and unnecessary anxiety.

That is of great concern to my constituents, some of whom have already retired. Many who were seven or eight years from pensionable age calculated their savings, pension entitlements and income and retired so that they could take on caring responsibilities within their families. They simply cannot adjust their finances to cope with such sudden changes.

The issue that concerns them, and indeed me, is the sense of injustice, which has left them feeling betrayed. When they started work aged 15 or 16, they had an idea of what was expected of them and what they were signing up to—similar, perhaps, to signing a contract of employment—but that is being unjustly altered, retrospectively, leaving them with very little time to prepare. They thought they were contributing to one thing, but in fact they will get another. There is simply not enough time for them to plan and prepare financially for their retirement, which causes them a great deal of anxiety. Moving the goalposts at such short notice is not the correct way to go about this. My constituents feel penalised, despite, as I said earlier, doing everything right.

Retirement should be about choice. People should be able to assess the prevailing factors and decide when it is appropriate for them to retire. Some of my constituents affected by these changes have already made the decision to retire and are living off small private pensions. The Bill effectively removes that choice. Their carefully planned savings will not suffice for the two extra years they will be forced to wait before receiving their pension.

I worry about the wider implications of the plans. The Minister says that we need to encourage people to save for their pensions, but what message is the Government sending to the young women of today? Are they saying, “You may save and you may plan, but we’ll make the changes anyway”?

I said that I would speak on behalf of my constituents, and I shall now directly quote just a couple of the letters I have received in the past few weeks. One constituent wrote:

“I started work aged 16 with the expectation of receiving a full state pension at 60. 5 years was added. I am now outraged to find that this government has changed it again. Having paid full contributions I now find myself worse off compared to my colleagues and friends who are only a few years older”.

As a result of the arbitrary way in which the Government have decided their dates, I am sure that some of that woman’s better-off colleagues and friends are only a few months or days older than her.

Another constituent wrote:

“I am currently in full time employment and have had 2 knee replacements and am about to have surgery on my back. I am in constant pain and find full-time work very difficult. However I was looking forward to my retirement. I had hoped not to have to claim for any benefits before my retirement but I can no longer see this being possible. I feel very let down and wonder why I have pushed myself to work so hard all these years”.

Have the Government assessed the costs they will incur when people who physically cannot work extra years claim benefits? Has that been taken into account?

Finally, another constituent said:

“I find that the goal posts are being moved and if these proposals go through I shall have to work for a further 91 weeks and £9,295 will be taken from my State Pension. I have worked hard all my life from the age of 15 and I have also brought up a family. I am looking forward to my retirement as the toll of all these years of working is starting to show and feel. This Coalition government is letting thousands of women down.”

[Jonathan Evans]

Hon. Members on both sides of the House will have received similar letters. The Labour party’s policy, as far as I understand it, is to begin the process in 2020. Therefore, those people would write similar letters—would they not?—if the policy adopted by the hon. Lady were pursued.

[Julie Elliott]

That is absolutely right. The Labour party set out a similar policy of raising the pension age, but we would have done it by 2020, which would have allowed a considerable time for people to plan and to take that into account. The problem with the Government’s proposal is not raising the pensionable age, but doing so in such a short period. That is radically different from anything the Labour party proposed.

The coalition agreement said that the state pension age would not rise sooner than 2016 for men and 2020 for women. The Bill breaks that coalition commitment. My constituents feel very angry and misled about that. Like many of the coalition’s ill-conceived policies, this is too much, too fast.