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The Pensions (Increase) Bill
20 September 2021
Lead MP
Therese Coffey
Debate Type
Bill Debate
Tags
Benefits & Welfare
Other Contributors: 28
At a Glance
Therese Coffey raised concerns about the pensions (increase) bill in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Lead Contributor
Opened the debate
The Secretary of State for Work and Pensions moves the Second Reading of the Pensions (Increase) Bill, which proposes a review of social security rates to ensure they keep pace with inflation or earnings. The Bill specifically addresses the direct link between certain benefits and earnings, including the basic state pension, new state pension, standard minimum guarantee in pension credit, and survivors’ benefits in industrial death benefit. She emphasises that the bill does not extend to other benefits like universal credit which are linked to prices instead of earnings. Due to an unprecedented fall in average earnings caused by the covid restrictions last year, a change was made to set aside the earnings link for one year. Now, with the economy reopening and witnessing a surge in the labour market, there is a statistical anomaly with an 8.3% increase in earnings. The Bill seeks Parliament's agreement to again set aside the earnings link for just one more year, applying the higher of inflation or 2.5%. This approach has been recommended by Sir Steve Webb, the former Liberal Democrat Pensions Minister.
Announces that the reasoned amendment in the name of Ed Davey (Kingston and Surbiton) has been selected.
Matt Rodda
Lab
Reading Central
The amendment is part of a series of broken promises by the Government, including cuts to overseas aid and increases in national insurance. Labour calls for the Government to maintain an earnings link and provide binding commitments to protect low-income pensioners.
Justin Tomlinson
INTERVENTION
Questions whether the Labour Party would welcome certain positive changes such as permanent increases in local housing allowance, work allowances, above-inflation increase to the national living wage and changes to income tax thresholds.
Chingford and Woodford Green
Supports the idea that the Government needs to make changes to the triple lock due to economic impacts from the pandemic. However, calls for a re-examination of investment levels in universal credit.
David Linden
SNP
Glasgow East
Opposes the Bill due to its negative impact on pensioners' incomes and its breach of manifesto commitments. Emphasises that UK state pensions are among the lowest in Europe, exacerbating poverty among pensioners.
Selaine Saxby
Con
North Devon
Intervened to highlight that despite not meeting triple lock criteria last year due to negative earnings growth, the Government raised pensions anyway, showing consideration for pensioners' needs.
Patrick Grady
SNP
Glasgow North
Echoed concerns about the double injustice faced by 1950s-born women due to the abandonment of the triple lock, highlighting their long-standing campaign for justice.
Douglas Ross
Con
Moray
Asked about state pension specifics in an independent Scotland and currency details, challenging the SNP's stance on independence as a solution to pensioner poverty.
Guy Opperman
Con
Hexham
Intervened to question Wendy Chamberlain's stance, referencing a former Pensions Minister from her party who supports the Government’s proposed changes.
Nigel Mills
Con
Wyre Forest
Supports the bill as it ensures pensioners have reasonable expectations for state pension increases. Criticises the idea of an 8% rise due to pandemic-related earnings fluctuations, arguing it is not in line with the triple lock's intent. Emphasises the need for fiscal sustainability and transparency.
Emphasises that increasing take-up of pension credit could address pensioner poverty. Noted the significant unclaimed amount in Wales, around £214 million, suggesting it is a viable solution.
Chingford and Woodford Green
Intervened to clarify that universal credit includes tax credits and supports the idea of investment in this system to help people into work, rather than reducing it.
Defends the decision to reduce the state pension increase due to economic conditions. Argues that most people understand why the Government is making this change and supports the move towards a double lock for a year.
Patricia Gibson
SNP
North Ayrshire and Arran
Ms Gibson criticises the Government for breaking their triple-lock promise to pensioners, noting that this will disproportionately affect women born in the 1950s. She supports an amendment requiring the Secretary of State to assess and be accountable for the impact of the legislation on poverty among pensioners. She highlights the low levels of pre-retirement wages compared to other European countries and points out the failure to extend automatic enrolment into workplace pensions, which disproportionately affects women. Ms Gibson also questions the lack of steps taken by the Government to increase uptake of pension credit.
Mick Whitley
Lab
Birkenhead
Mr Whitley condemns the government's breaking of its triple-lock promise, citing it as yet another example of broken promises from the Conservatives. He highlights the impact on pensioners during the pandemic and warns that without reinstatement of the triple lock in 2023, future winters will be harder for retired people. He also calls for a commitment to publish advice given on this issue.
Gavin Newlands
SNP
Paisley and Renfrewshire North
The UK's policy on pensions is a result of decades of deliberate decisions to underfund older people. Removing the triple lock will impact pensioners negatively, especially given rising energy costs and food prices. The Bill undermines the social contract and welfare state, affecting more than half of single pensioners who live in fuel poverty already.
Jim Shannon
DUP
Strangford
While it is necessary to address the financial deficit caused by covid, raiding pensioners' incomes is unjust. Pensioners need additional funding due to rising costs; cutting their benefits will leave them worse off. The Bill will disproportionately affect Northern Ireland's pensioners, especially those in fuel poverty and Housing Executive accommodation.
Jonathan Reynolds
Lab Co-op
Stalybridge and Hyde
Opposes the amendment, questioning the Government's evidence for an 8.3% wage growth rate due to the pandemic anomaly. Emphasises the importance of maintaining manifesto commitments and highlights increasing pensioner poverty despite overall spending on pensions rising.
David Linden
SNP
Glasgow East
Highlights figures showing rising numbers of pensioners living in poverty below 60% of the median income after housing costs. Raises concerns about trust issues stemming from recent Government decisions breaking manifesto commitments.
Spencer
Con
Runnymede and Weybridge
Argues that maintaining the value of the state pension is crucial, but questions whether holding to manifesto commitments might lose trust. Proposes a wider debate on the earnings lock.
Nigel Mills
Con
Amber Valley
Questions the ability to analyse underlying wage trends without pandemic impact and agrees with the challenge of finding unchallengeable data.
Stephen Timms
Lab Co-op
East Ham
Points out that pensioner poverty is rising and emphasises the need to increase take-up of pension credit. Raises concern about the juxtaposition with the cut to universal credit.
David Johnston
Con
Wantage
Discusses past debates on pension upratings and the improvement in poverty levels under previous Labour governments, but agrees that discussion should not be framed as intergenerational conflict.
Patricia Gibson
SNP
North Ayrshire and Arran
Raises concerns about lack of trust stemming from broken manifesto commitments. Emphasises the need for more engagement on the accuracy of data.
Guy Opperman
Con
Hexham
The Minister emphasised that the Bill ensures pensioners’ spending power is preserved and protects them from higher costs of living. He highlighted that pensioner poverty has decreased since 2010 due to the triple lock, which increased the full yearly basic state pension by £2,050 in cash terms. The Minister also mentioned there are now fewer pensioners in absolute poverty compared to 2009-10.
Stephen Timms
Lab
East Ham
Intervened to point out that while the Minister used an absolute measure of pensioner poverty which showed a decrease, the more widely accepted relative measure indicated an increase in pensioner poverty.
Patricia Gibson
SNP
North Ayrshire and Arran
Asked for clarification on whether the Scottish Government could intervene on pensions matters under sections 24, 26 and 28 of the Scotland Act 2016.
Jim Shannon
DUP
Strangford
Asked the Minister to give extra emphasis to Northern Ireland in addressing pensioner poverty, noting that 15% of pensioners are consistently in fuel poverty and overall poverty.
Government Response
The Secretary of State for Work and Pensions moves, That the Bill be now read a Second time. She emphasises that this Government are committed to ensuring that older people can enjoy their retirement with security, dignity and respect. Since 2010, the full yearly basic state pension has increased by more than £2,050 in cash terms. There are now 200,000 fewer pensioners in absolute poverty compared to 2009-10. She is proud of the Government's record on support for pensioners and their action last year to ensure that pensioners' incomes continue to increase. The Bill will ensure that a temporary statistical anomaly in wages does not unfairly track across into pensions, while also preserving the spending power of pensioners and protecting them from increases in the cost of living.
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