Personal Independence Payments

Debate between Lord Field of Birkenhead and Damian Green

Wednesday 15th March 2017 Commons Chamber

[Damian Green]

My hon. Friend, who obviously has great personal expertise in this area, is precisely right. There is a continuous dialogue between the Department and the charities. Sometimes we agree and sometimes we do not agree, but that dialogue is very important and I am determined to maintain it precisely so that when we make changes they are practical ones that make sure that the original good intent of the benefit is maintained.

[Frank Field (Birkenhead) (Lab)]

Despite what the Secretary of State says about the current benefit favouring those who do not have physical disabilities, the evidence coming to the Select Committee which is inquiring into PIP shows that those with other disadvantages find it difficult to qualify. Might he look carefully at the form and at the way his staff interpret it for people who do not have physical disabilities and who have difficulties in qualifying?

[Damian Green]

The right hon. Gentleman knows that there is a review going on precisely to address the points he very reasonably makes. Clearly, there is a degree of complexity with any benefit and we will need to keep working on it. We are waiting for the review carried out by Paul Gray, chairman of the SSAC. Knowing Paul, I am sure he will have some trenchant recommendations, and we will obviously look at them very carefully and use them as the basis for further improvement of this benefit.

Oral Answers to Questions

Debate between Lord Field of Birkenhead and Damian Green

Monday 20th February 2017 Commons Chamber

[Damian Green]

I can only refer the hon. Gentleman to the answer I gave the hon. Member for Linlithgow and East Falkirk (Martyn Day), because it is for the Scottish Government to take these decisions. They have the power to give benefits, increase benefits and make supplementary payments beyond the benefits available throughout the UK. It is noteworthy that they fail to exercise those powers and Scottish National party Members come to this House to complain about benefits in Scotland, despite having the power to do something about it themselves.

[Frank Field (Birkenhead) (Lab)]

I support the Government’s strategy in this area, but does the Secretary of State accept that those who support it have concerns about what might be happening, certainly in the short run, to families so affected? What research is he carrying out to make sure that those who can move into work do so and that those who cannot do so are looked at sympathetically?

[Damian Green]

The right hon. Gentleman makes a characteristically reasonable point, to which I make two responses. The first is that those who are put into hardship have available to them discretionary housing payments, which have been extensively used by local authorities throughout the country precisely to avoid the problem that he suggests. Secondly, on the other point he makes, some of the research we have done shows that households that have been capped are 41% more likely to go into work than similar, uncapped households. So the policy is very successful in encouraging people to get back to work, which of course is the best thing for them in the long run.

Pension Schemes Bill [Lords]

Debate between Lord Field of Birkenhead and Damian Green

2nd reading: House of Commons
Monday 30th January 2017 Commons Chamber

[The Secretary of State for Work and Pensions (Damian Green)]

I beg to move, That the Bill be now read a Second time.

Let me start by placing the Bill in the context of the Government’s overall record on pensions. This Government have delivered radical and much-needed changes to our pensions system to make savings easier, fairer and safer for all. Since 2010 the pensions landscape has seen a revolution not only in state support, but in the ways in which people can save and access their pension savings.

We have removed the default retirement age, helping people to live fuller working lives. That is good for people’s wellbeing and their retirement income, and it benefits individuals, employers and the economy. We have made it easier for them to understand their state pension, and by setting the full amount at £155.65 a week we will lift more pensioners out of means-testing in the future. Together with the reviews of the state pension age, those changes are creating a sustainable system as a foundation for people’s private retirement saving.

We have increased private long-term savings by introducing automatic enrolment. More than 7 million people have already been automatically enrolled into a workplace pension, and more than 370,000 employers have declared that they have met their automatic enrolment duties. This is the cornerstone of our private pension reforms and it reverses the decade-long decline in pension savings prior to its introduction. It is a programme that works and it helps people achieve a more financially secure later life.

I am grateful to the many independent observers who have commented on the success of the policy. The Work and Pensions Committee has recognised that automatic enrolment has been a “tremendous success”. The National Audit Office, reporting on automatic enrolment in November 2016, found that the

“programme is also on track to deliver value for money in improving retirement incomes in the longer term”.

Findings of a report by the Institute for Fiscal Studies, which was also published in November 2016, suggest that automatic enrolment is having a huge relative impact on those with the lowest participation rates in workplace pensions before its introduction, in particular those aged between 22 and 29—a group that has seen a 52.1 percentage point increase in pensions saving—and those in the lowest incomes quartile, who have seen a 53.9 percentage points increase. Moreover, the institute found that automatic enrolment is having an effect well beyond our target eligible group, in particular those earning under the £10,000 threshold, and that some employers are paying above minimum contribution rates.

Women are benefiting, too. In 2011, only 39% of eligible women employed in the private sector were in a workplace pension; by 2015, the figure had increased to 70%. By 2018, we estimate that 10 million workers will be newly saving or saving more into a workplace pension as a result of this change, generating about £17 billion in additional pension saving each year by 2019-20.

The Government’s introduction of pension freedoms in April 2015 allows those aged 55 and over to access their pension savings with more flexibility. People with defined contribution pension schemes can now choose to use those funds in the way that is most suited to their circumstances, whether by drawing down the income, taking out an annuity, taking a lump sum or using some combination of those options. Since the introduction of pension freedoms, more than 1.5 million payments have been made, with £9.2 billion withdrawn flexibly in the first 21 months.

That is the landscape; let me turn to the Bill. Our focus now is to make sure that the regulatory landscape continues to be effective in protecting members so that everyone can have confidence in their pension scheme. Automatic enrolment requires employers, small and large, to provide pensions for their workers, in many cases for the first time. Automatic enrolment is helping to ensure that tomorrow’s pensioners have greater security and an asset base in later life. Many employers have selected master trust pension schemes because they can offer scale, good governance and value for members.

[Frank Field (Birkenhead) (Lab)]

I am grateful to the Secretary of State for giving way and for his earlier comments. Although we may have differences on the adequacy of the Department’s responses to some of the Select Committee’s reports, its response to our report on this issue is immensely encouraging. I think that some Members of the Committee will want to endorse the Secretary of State’s proposals, which implement some of our recommendations to defend the hard-earned savings that many people are making, sometimes for the first time, by auto-enrolment. We do not want the cowboys to get hold of those funds.

[Damian Green]

I am extremely grateful to the right hon. Gentleman for his words. Throughout his intervention, I was expecting “but” to appear at any moment, and it did not. We can be as one on the matter, and I will seek to improve our responses to future reports of the Committee that he chairs.