Government sits on its hands while women await pension developments

By Rachel Reeves MP / @RachelReevesMP

If you were unaware that the Pensions Bill Committee has been sitting for the last two weeks you could be forgiven. Not only has parliament been engulfed by the furore over phone hacking, but the government sat in almost uniform silence throughout all eight committee sessions, before proceeding to reject every one of the amendments Labour proposed.

The Pensions Bill, which will change the agreed timetable for raising the State Pension Age, has significant consequences for one particular group of women. 500,000 women born in 1953 and 1954 will have to wait more than a year to receive their state pension – 33,000 of them will have to wait exactly two years. With the proposed changes starting in 2016 new timetable leaves women very little time to prepare for losing up to £15,000 of pension income.

Those affected are not doing so quietly. A 12,000 strong petition was handed to the Prime Minister; a mass lobby of parliament saw women from across the country take the issue direct to their MPs; and nearly 200 MPs from across the House have opposed the plans publicly – including more than 1/3 of the Liberal Democrat Parliamentary Party. The Secretary of State and the Minister for Pensions have both answered numerous questions from MPs on this issue, and the Prime Minister has had to duck questions in the Commons no less than six times. This is an issue which has resonated deeply with people’s sense of fairness.

And rightly so – these proposals are deeply unfair on a number of levels. Because these women have typically earned less than men during their careers, taken career breaks to care for children, and often worked part-time in an era when part time workers were not offered occupational pensions, they have on average one sixth of the pensions savings of their male peers. In fact 40% of the women affected have no private pension savings at all. Additionally, they have already accepted one increase in their Pension Age and have had to adjust their financial plans accordingly. A second change at such short notice is not only deeply unfair, but is also something which many of those affected are in no position to cope with.

I have backed an alternative policy that would accelerate the increase in the State Pension Age in a way which is fair to all, including these women. It is right and necessary that we increase the pension age in response to increasing longevity, but this must be done in a way which spreads the costs between men and women, between different age groups and gives adequate notice. Piling the burden on the shoulders of women born in 1953 and 1954 is unfair and wrong.

Such has been the opposition to these changes that in the 2nd Reading of the Bill only two MPs stood up to support the government’s proposals, while MPs from all sides of the House spoke in opposition. During that debate, both the Lib Dem Minister (Steve Webb) and his Tory Secretary of State (Iain Duncan Smith) hinted that some sort of ‘transitional arrangements’ might be put forward by the government for the women worst affected.

Given these warm words, we were disappointed, that thegovernment failed to bring forward their proposals for discussion in Committee stage of the Bill, when MPs are supposed to scrutinise the legislation, line by line. Time is running out for the government to introduce the changes. The experts are agreed – people need more time to plan for their retirement than these plans afford. If the government is going to listen to the voices of the thousands of women affected by this and protect those who face the longest wait, it needs to act now, and bring proposals to Parliament at the first opportunity.

Unless they do so they will be heaping injustice on a group of women who have worked hard, balanced family and work commitments, and now, with such little notice, are seeing their carefully thought-through plans being rendered meaningless by these unfair, ill-considered proposals.