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Pensioner Poverty

It is misleading to focus on the state pension alone. I think that my hon. Friend was referring to the OECD report published in June. That report shows that the replacement rate for the average earner, taking account of private pension provision, rises to 70 per cent., which is above the overall OECD average. The European Commission's report on social protection and social inclusion this year showed that the median income of those aged 65 and over in the UK rose from 15 per cent. below the EU average in 1997 to 9 per cent. above it in 2007. So my hon. Friend should give credit where it is due. Let me say a few words about the Pensions Act 2008. For the first time, all employers will be required to contribute a minimum of 3 per cent. to an eligible employee's workplace pension scheme. That will supplement the 4 per cent. contribution from the employee and about 1 per cent. from the Government in the form of tax relief. It is planned to introduce from 2012 a new low-cost saving vehicle—the personal accounts scheme—aimed at employees who do not have access to a good-quality work-based pension scheme. In the main, those are median to low earners. The Opposition spokesman, the hon. Member for Eastbourne (Mr. Waterson), suggested that this week there had somehow been a U-turn, or at least an S-bend. That is absolutely not true. The starting date for automatic enrolment is unchanged; it was always planned to be October 2012, and it is still planned to be 2012. Implementation was always intended to be staged, and it is still intended to be staged. We will announce in January the details of our full implementation path, in response to the consultation that we have undertaken. I shall move on to the position of women in the pension system, because they were one of the key groups that the Select Committee identified as facing particular problems. Of course, the most important thing that has been done in the past 12 years is the introduction of pension credit, which means that pensioners need not live on less than £130 a week. Almost 60 per cent. of recipients of that credit are single women. As a result of the reforms that we have introduced, around three quarters of women reaching state pension age in 2010 will be entitled to a full state pension, compared to around half who would have been entitled without the reform, and the figure will have risen to more than 90 per cent. by 2025. Reforms in the Pensions Act 2008 will provide equality of opportunity for male and female workers to build up a private pension, thus tackling the long-term problems from which women in this country have suffered in the past two generations. We estimate that around 3.5 million to 4 million women will be eligible for automatic enrolment in a workplace pension scheme. My hon. Friend the Member for Bradford, North also raised the issue of people disabled in early life becoming poor old people—having a life totally lived in poverty. It is certainly true that that group has a high risk of living in poverty, but I would like to point to a number of policies that the Government are implementing that are intended to—and do—help to mitigate that situation. First, the gap between the employment rate of people with disabilities and that of the rest of the population has been falling, and that means that people with disabilities are able to build up their contributions record, which is what they need for their pension. Further to that, we have introduced reforms to the state pension, ensuring that more people with disabilities can build up a state second pension, as well as the credits for a full pension. The hon. Member for Henley (John Howell) pulled out a number of issues from the report. The first one he talked about was the position of pensioners in rural areas. One of the things that the Government have done to support people in rural areas is to introduce free bus passes. I do not know the Conservative party position on that or whether it intends to maintain free bus passes.