---

Pensioner Poverty

I want to start by saying what a pleasure it was to serve on the Select Committee during this inquiry. Pensioner poverty is an important subject and, as people can see from the two volumes of the report that were produced and the evidence that went with them, it was a subject that we tackled in considerable depth, with assistance from a range of organisations. I want to draw attention to four things in the report. The first is recommendation 130, which has already been mentioned by the Chairman of the Select Committee, the hon. Member for Bradford, North (Mr. Rooney). It relates to the Committee's disappointment that there is an unacceptable level of pensioner poverty in some black and minority ethnic communities but pretty little in the way of information that explains why that problem exists and how it can be tackled. Having said that, the take-up of pensioner credit among BME communities must play a crucial part. So I want to echo recommendation 130, which showed the seriousness with which we viewed that issue, and to stress the importance of that recommendation. Recommendation 199 is particularly helpful. My constituency is relatively close to London compared with the north of England, but it is still a very rural constituency. Of the 75,000 voters in my constituency, I think that only 14,000 live in towns; the rest live in small villages. Recommendation 199 brings out clearly the difficulty for pensioners, particularly pensioners in poverty, of living in a rural area. I think that too often we forget the difficulties that living in a rural area creates—both the extra costs and the physical difficulties of transport. Essentially, in many rural areas people are restricted to using their own transport, as public transport is weak. For example, my own village is considered sustainable on the basis that it has a bus stop, but there is only one bus during the week that takes people to the market to shop and then brings them back a couple of hours later. Of course, that leads to the other side of pensioner poverty in rural areas, which is the isolation that pensioners feel. Obviously, the financial aspect, combined with that feeling of isolation, makes for a sort of double hit on pensioners in rural areas. So recommendation 199 was one that I felt particularly strongly about. The third recommendation that I want to underline is 315, which refers to the default retirement age. There was huge support for allowing the flexibility that the recommendation calls for. Retirement age must be a judgment for individuals; they must have the flexibility to decide when they retire, so that they can manage their retirement as they have managed their working life. The evidence that we found was that such flexibility was not a particularly onerous burden on employers. We found that people did not want to work for more than one or two extra years, but that the extra time made a big difference to them financially. The fourth and last point that I want to emphasise is not one of the report's recommendations but the evidence from our visit to Canada. For me, that visit was a particularly useful exercise, because we were impressed with Canada's success story in the last 10 years in reducing pensioner poverty. A number of things struck me about that success story that we might want to think about. The first was the way in which the Canada pension plan had been funded, or at least part-funded, in the good times. Obviously, the opportunity to do the same has now passed us by and it is unlikely to be a practical option in the future, so it is a source of regret that we did not go down that route. One of the other things that I was struck by was that the fact that the Canadian pension plan funds were managed on a completely arm's-length basis, unrelated to any contribution that they might have to make to the Canadian economy. They were there to generate as much income as possible to fund pensions. That professionalism came out very strongly. The last element of the Canadian experience was the recognition that there was no obligation in Canada to purchase an annuity, something about which we have probably all had correspondence from constituents during these recessionary times. The Canadians thought about it in advance and ensured that annuity purchase was not compulsory, a policy that we would like to see enacted for pensions here; I would certainly welcome it. I stress those three recommendations. The evidence from the Canadian trips usefully brought together a lot of my experience of the matter. It was a useful trip and one that achieved an enormous amount for my own personal education and knowledge. I am grateful to the Committee for allowing me to be a part of it and for choosing this subject.