Work and Pensions Questions

11th July 2016

Shailesh Vara answers MPs’ questions on issues including the potential effect of the UK leaving the EU on British pensioners living overseas and workplace pensions auto-enrolment.

UK Pensioners Abroad

2. What assessment he has made of the potential effect of the UK leaving the EU on British pensioners living overseas. [905749]
 

There will be no immediate changes, as a result of the referendum, in the circumstances of British pensioners. Negotiations for Britain’s future relationship with Europe will begin under the new Prime Minister.

What discussions has the Minister had with European countries about the exchange rate and its effect on pensioners abroad?

As I say, the negotiations proper will begin when we have a new Prime Minister. In the meantime, we have a European unit that has been set up in the Cabinet Office, and it will report to the new Cabinet in due course.

But would it not make sense for the Department for Work and Pensions to do some investigative work now, when there are thousands if not millions of British pensioners living elsewhere in the European Union? Those people currently have free access, for example, to the NHS in their local areas without contributing, but they might suddenly find their finances to be in dire jeopardy and wish to return to this country. Should not the DWP act immediately? Let me gently suggest to the Minister that just waiting as if the new Prime Minister is going to be some way away might be a bit of a mistake?

I can assure the hon. Gentleman that we are working closely with the new European unit set up in the Cabinet Office, to which I referred in my previous answer.

This is about doing what is right. We are talking about British pensioners living overseas who have paid national insurance. Why not remove that uncertainty? Why not guarantee what they are entitled to? It is all about doing the right thing with a new Prime Minister. Let us get off on the right foot and make sure that happens..

The hon. Gentleman is absolutely right, but we need to have the new Prime Minister in place before those negotiations can start proper.

Is the Minister not aware that the role of pensioners is a very sophisticated and complex one? Many of them depend for support on free access for their relatives in this country and on freedom to travel, as do young people going to places such as Spain to work. Has the Minister not already looked at this in some detail?

As I said, the result of the referendum came only some few days ago, but I can assure the hon. Gentleman that detailed conversations are going on in the Cabinet unit. Let me provide him with the further assurance that Britain still remains a member of the EU. I want to reassure British people living in EU countries and those EU citizens who are living in the UK that there will be no immediate changes in their circumstances.

 

Workplace Pensions: Automatic Enrolment

3. What progress his Department has made on auto-enrolling people into workplace pensions. [905750]

Automatic enrolment has been a great success with nearly 6.3 million people automatically enrolled into a workplace pension by almost 143,000 employers. We will continue with our programme to get many more people enrolled.

Auto-enrolment has met or exceeded all initial targets. However, to maximise pensions in the long term, we need to bear down on charges. Two years ago, the Government put in place a cap of 0.75%, which is half that permitted by the Opposition when they had one for stakeholders. The Government said they would review the level of the cap, with a view to it being lower in future. Will the Minister update us on the status of that review?

I am grateful to my hon. Friend for raising this very important issue. I can give him an assurance that, in 2017, we will review whether the level of the charge cap should change, and whether to include some or all transaction costs in the cap.

The Minister will know that in September last year, in evidence to the Work and Pensions Committee, the Economic Secretary said that if there was not transparency and comparability in fees, the Government would legislate. Does he think there has been transparency? If not, when will he legislate?

The hon. Gentleman raises a good point. We are committed to transparency and openness, and, when opportunity allows, to putting them into place in legislation.

I congratulate the Minister on the successful roll-out of auto-enrolment. What more could be done to help the self-employed to engage in the process?

We are working very closely with the Pensions Regulator to ensure the whole programme of auto-enrolment is easily understood, in particular for self-employed people and those who have one or two employees, so that the rules are in very clear easy-to-use language on the website and in offline literature and any other offline facilities.

 
 

State Pension Age: Transitional Protection for Women

4. If he will make it his policy to introduce transitional protection for women adversely affected by the acceleration of increases in the state pension age. [905752]

9. If he will make it his policy to introduce transitional protection for women adversely affected by the acceleration of increases in the state pension age. [905758]

Transitional arrangements are already in place. We committed over £1 billion to lessen the impact of the changes for those worst affected, so that no one will see their pension age change by more than 18 months compared with the previous timetable. We have no plans for further changes.

My constituent who turned 60 this year has not received any information about the changes. She was the primary carer of her children and now cannot work because of disability. but now looks forward to having to work another six years. The Minister has been presented with many proposals, including transitional arrangements. When will the Government give these women the justice they deserve?

The hon. Lady refers to notice. At the time of the Pensions Act 2011, more than 5 million affected people did receive notification. That was done using the addresses Her Majesty’s Revenue and Customs then had. As far as the proposals are concerned, they all, regrettably, cost a huge amount of money. We therefore have no plans to go down that route.

In reality, it is the 1950s-born women who are bearing the cost. My constituent is 62-years-old and is about to be made redundant in July. She suffers with diabetes, a heart condition and COPD. She tells me that, owing to limited childcare, she worked part-time when her family were young and could not contribute to her pension. She is now very anxious that she will never be able to secure another job, and will not receive her state pension until she is 66. She has a large black hole now in her life. How does the Minister advise her on facing that bleak future?

I assure the hon. Lady that, under the coalition Government and the present Government, we have record levels of employment for women, including older women. That is something to bear in mind. We are working extensively with employers to ensure they appreciate the value of older workers, which they do. That is why we have record levels of employment, particularly for women.

I suspect that most hon. Members have been acquainted with difficult cases like the one mentioned by the hon. Lady. Will my hon. Friend the Minister keep an open mind on pension credit arrangements for these people? They are, after all, means-tested and could deal with the worst hardship cases.

We do have particular criteria and where people fit that criteria, they will of course qualify for whatever benefit it is they are seeking guidance on.

Two thousand women in Dudley North worked hard to save and plan for their retirement, but have been affected by the changes. Will the Minister meet me, my constituent Hilary Henderson and the other women from Dudley North to discuss the changes in detail? If not, why not?

I recently met the leaders of the Women Against State Pension Inequality campaign, and I have met many members of the campaign in my constituency, so I am very well aware of all the details and facts. As the hon. Gentleman knows, there have also been a huge number of debates about the subject in the Chamber in recent weeks.

Given the imminent takeover by the new Prime Minister, who herself falls into the category of women affected by the pension changes, would this not be the ideal moment to look again at the various proposals that have been advanced for much fairer transitional arrangements—such as the one from Mariana Robinson of Wales—for all the women who do not have a prime ministerial salary to fall back on?

I remind the House that in 2012 the DWP conducted a survey and found that only 6% of women who were due to retire within the next 10 years were unaware of an increase in the pension age. As I said earlier, the Government have no plans to review the matter.

A little over a week ago, thousands of women from across the United Kingdom came to Parliament in a display of solidarity that reminded me very much of the Dagenham women some decades earlier. Is not the Secretary of State’s refusal to revisit the financial issues faced by the 2.6 million women whose pension ages have been increased without adequate notice a slap in the face for those women? Given that the former Pensions Minister admitted that the coalition Government had got it wrong, why is the Under-Secretary being so unreasonable?

I find it deeply regrettable that Opposition parties seek to make capital at the Dispatch Box, and indeed from the Back Benches, when they do not have a solid proposal. They cannot provide a proper, credible solution that will ensure that the financial position of the country is taken into account. I might add that if the Opposition parties are so keen on this issue, they should bear in mind that although the Pensions Act came into being in 2011, the issue was not raised in any of their manifestos.

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Women Against State Pension Inequality Campaign

10. What recent representations he has received from the Women Against State Pension Inequality campaign; and if he will make a statement. [905759]

The Pensions Minister, Baroness Altmann, and I recently met WASPI representatives to listen to their concerns. We made clear the Government’s position that we will not be unwinding past decisions and that there are no plans to change policy.

Between 2016-17 and 2025-26, more than 5,000 women in my constituency alone will be affected by the changes. Some of them will need to work six years longer than they anticipated. For the last time, I ask the Minister to show some leadership. Rather than shrug his shoulders, will he step up to the mark and end this injustice?

No one is shrugging shoulders. As I said, no credible alternative has been put forward by any of the parties in this House; it was not in their manifestos. Members do not help the WASPI women by leading them to have expectations when the position of the Government is absolutely clear. A £1.1 billion concession was made in 2011; the period involved was reduced from two years to 18 months; and for 81% of the women affected the period concerned is no more than 12 months—81% of the women will not be affected by more than 12 months.

A few moments ago, the Secretary of State made a statement saying that Britain’s economy was booming—or words to that effect.[Interruption.] It was as near as dammit. If it is that good, why does he not make sure the WASPI women get the proper pensions, and not this load of crap the Government are chucking out now?

Let me just correct the hon. Gentleman: my right hon. Friend the Secretary of State said that the economy was fundamentally strong. As for the other issues, it would have been helpful if the hon. Gentleman had listened to some of the answers I had given earlier, while he was rehearsing his question. If he had listened, he would have appreciated—

You are in the Government.

If he had listened to the questions, he would have found that I said a £1.1 billion concession was made in 2011.

Topical Questions

T2. What support is my right hon. Friend’s Department offering to those in later middle age and older who are seeking work?[905774]

My hon. Friend raises a very good point. We are doing a number of things in this area. For example, as well as access to a full Jobcentre Plus offer of personalised support, the Department for Work and Pensions introduced older claimant champions in each of the seven Jobcentre Plus groups to work with work coaches within jobcentres to raise the profile of older workers, highlight the benefit of employing older jobseekers and share good practice.

T5. Will the Secretary of State explain to the WASPI women from the north-east, some of whom have already retired in the mistaken belief that they would be receiving their state pension sooner and who live in a region that continues to have the highest level of unemployment in the country, how they are to make ends meet? [905777]

The hon. Lady is well aware that a number of benefits are involved here. The DWP survey in 2012 found that only 6% of the women who were due to retire within 10 years were unaware that the state pension age had increased.

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T10. The disabilities Minister just agreed to meet a Member of Parliament and their constituent regarding an issue they were concerned about, so can I try again with the Pensions Minister? Will he meet me and some of the 10,000 women born in the 1950s who are affected by the pension changes? Will he come to Hull to meet some of these people and hear directly from them?[905782]

I have met the leadership of the WASPI campaign, and I have met my own constituents. The hon. Lady has articulated the views of her constituents, as have many other MPs on a regular basis. I know very well all the facts; the issue here is that Members such as her should not be giving expectations to women, when the position has been made absolutely clear at the Dispatch Box: the Government have no intention of changing their policy.