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Pensions Bill [Lords]

I am grateful for that intervention. The way to get round all the problems, legal or otherwise, is to follow the excellent suggestion that my hon. Friend the Member for Leeds West (Rachel Reeves) has already made in the debate and will restate in her winding-up speech: prevent this unfair change from going ahead and instead look at some of the accelerations in pension age that can be made, particularly in respect of people retiring at 66 or 67, which can also save money for the Exchequer. The Minister and the Secretary of State did not spell out to the House what the legal problems were. Some Members have speculated that they relate to matters of European law. I hope that when the Pensions Minister winds up the debate, he can outline the legal issues. They certainly were not outlined to the country when the coalition agreement was signed, or during the press conference—the love-in—in the rose garden thereafter. The Bill also fails the test of fairness, because it places too great a burden for savings on one group of the population when the Government should be looking elsewhere, such as at equalising state pension eligibility at 67. As my hon. Friend the Member for Kilmarnock and Loudoun (Cathy Jamieson) pointed out, even before these deeply unjust proposals were announced by the Government, women had been disadvantaged in pension provision for some time. As she said, median pension saving of a 56-year-old woman is just £9,100, almost six times lower than that of a man which, on average, is £52,800. Research by Prudential establishes that the average woman retiring this year can expect an annual income in retirement of £12,900 per annum, compared with an expected income of £19,400 for the average retiring male. Further, the same study found that 28% of women planning to retire this year have no savings in private or company pension schemes, compared with just 10% of men. The previous Government's strategy of seeking to link the basic state pension to earnings and making private pensions opt out instead of opt in sought to redress the balance and would have been implemented if we were in government. More safeguards should have been established through the Bill, rather than entrenching inequity, as it appears to do. Following the Bill, women affected will have less than seven years to react to the changes, and may be less likely to be in a pension scheme at all, with less disposable income to supplement savings for retirement, and with greater care responsibilities. Women are also much more likely to wind down in later years of employment, be that to care for elderly relatives or for young grandchildren. Furthermore, it will be more difficult for women to move from part-time to full-time work, or indeed back into employment of any form, given current economic conditions. The Office for Budget Responsibility's projection of 310,000 public sector job losses in the coming years will disproportionately impact women, who make up 65% of that work force. The Prime Minister said on Radio 2 today that retirement should be"““a process rather than a cliff edge””" and that"““many people, when they get to retirement, would like to go on doing some work or part-time work””." The reality is that the cliff edge imposed by the Bill is an unfair burden on 56 and 57-year-old women who have done the right thing and saved for retirement but are now being grievously abandoned by the Government. Recent decades have seen a change in employment patterns among women. The dated notion that a woman's role is to stay at home and look after the children has been well and truly dispelled, but for women in their late 50s who are due to be affected by the proposals, such changes in social attitudes may not have been reflected in the earlier parts of their working lives. The Government's reckless haste in changing the state pension age for those women makes adapting to that change even more difficult. As Carers UK indicated last month, these changes will have a disproportionate impact on other social groups. About 58% of carers—3.4 million people—are women, as are one in five carers aged between 54 and 60. Of the estimated 662,000 carers who combine part-time work with caring, 89% are female. For carers, there is little opportunity to make contributions to a private pension plan or savings, even if they are in part-time employment. For women who are carers, provisions in the Bill collude to put them at even greater disadvantage. In responding to the comprehensive spending review last October, Joanne Segars, chief executive of the National Association of Pension Funds, noted that any changes must include an improved and secure basic state pension. Savings from the Bill's proposals on the state pension age will not even exceed £l billion until 2018-19, which is well outwith the range of the Government's fiscal consolidation plan. The Bill does not spell out how they plan to increase the basic state pension for all. Again, there is little in the way of incentive and assistance for people who will now have to work longer. As the Equality and Human Rights Commission notes:"““Rather than focusing on increasing men's State Pension Age and perpetuating the gap between men and women, Government should focus on how to help women and men extend their working lives, if they wish to do so, and thus reduce the disadvantage that women face in the workplace by shortened working lives.””" Women will also be penalised by the design of the Bill's provisions on auto-enrolment in pension schemes, which will reduce the number of people enrolled by almost 600,000. This is a Bill of broken promises from a deeply dysfunctional Government. It changes the terms of the social contract between women, low-paid workers and the state, with insufficient notice and scant regard to the effects on rising inequality. They are unjust proposals that bear the imprint of the Chancellor, despite having nothing to contribute to his deficit reduction plan during this Parliament. They put the burden of further departmental savings on the shoulders of too few people, and those people have worked and saved for the pension contributions they have accrued. That is why the Bill deserves to be opposed in the Lobby tonight.