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Pensions
01 March 2021
Lead MP
Guy Opperman
Debate Type
General Debate
Tags
Crime & Law EnforcementEmploymentClimate
Other Contributors: 6
At a Glance
Guy Opperman raised concerns about pensions 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
This order reflects the conclusions of this year’s annual review of the automatic enrolment earnings threshold required by the Pensions Act 2008. The earnings trigger determines eligibility for automatic enrollment, and the qualifying earnings band sets the limit on contributions. The current order does not change the lower earnings limit or the earnings trigger but sets a new upper limit for the qualifying earnings band effective from 6 April 2021. The Government's commitment to auto-enrolment includes support through the coronavirus job retention scheme, and statistics show increased workplace pension participation rates since its introduction in 2008.
Matt Rodda
Lab
Reading Central
Auto-enrolment has been a positive development for savers' long-term prosperity. The Government should continue and expand the scheme despite economic challenges posed by the pandemic. Labour supports the order but urges the Government to lower the qualifying earnings threshold and reduce the age threshold for automatic enrolment as committed in 2017. There is concern about the implications of freezing the earnings trigger, which affects female workers and ethnic minority employees disproportionately.
David Linden
SNP
Aberdeen South
The SNP calls on the UK Government to remove the £10,000 earning threshold for pensioners’ automatic enrolment due to concerns about lower-paid workers losing out on vital retirement savings. The earnings trigger exacerbates gender and ethnicity pensions gaps, with women disproportionately affected by low wages or part-time work, leading to later life poverty. The SNP offers solutions such as removing the lower limit so contributions are payable from the first pound earned, lowering the age threshold from 22 to 18, and expanding contribution rates beyond the statutory minimum.
Stephen Timms
Lab
East Ham
The debate discusses the Government’s longer-term intentions on auto-enrolment, questioning why the earnings trigger is being frozen at £10,000. The speaker highlights that this change does not represent progress towards the 2017 review's ambition of implementing changes before the mid-2020s to include contributions for all employees aged 18 and over from the first £1 they earn. He also asks about further progress on increasing contributions beyond the statutory minimum, addressing gig economy workers' eligibility for auto-enrolment due to recent Supreme Court rulings, and enquires into extending auto-enrolment success to self-employed individuals.
Wendy Chamberlain
Lib Dem
North East Fife
The speaker acknowledges the success of automatic enrolment but expresses concern about the lack of progress on lowering age thresholds and abolishing lower earnings limits as per the 2017 review. She calls for an update from the Minister regarding these changes and raises concerns over gaps in coverage affecting young people and those with multiple low-paid jobs, especially women due to disproportionately falling below the earnings threshold. Chamberlain also questions how the Government will respond to the recent Supreme Court judgment on Uber workers' status and its implications for auto-enrolment.
Jim Shannon
DUP
Strangford
Jim Shannon supports automatic enrolment for pensions, citing Library briefing data that shows a tenfold increase in membership of defined contribution occupational schemes from 2.1 million to 21 million between 2011 and 2019. He raises concerns about the financial impact on employers due to furloughing staff during the coronavirus pandemic and suggests retaining the lower earnings limit for now. Shannon believes that changes should not be implemented at this time, advocating for support for small employers.
Guy Opperman responds positively to the debate, highlighting the Pension Schemes Act 2021 and automatic enrolment reforms which have increased pension savings among young people from about 35% in 2012 to 86% currently. He commits to ongoing support for employers through measures such as the automatic enrolment review, pensions dashboard implementation, addressing pension scams under section 125 of the Pension Schemes Act, and integrating climate change considerations into pension policies.
Government Response
Guy Opperman responds to concerns raised by Jim Shannon regarding financial pressure on employers during the pandemic. He assures that the Government will continue supporting employers through ongoing measures such as automatic enrolment reviews and addressing pension scams, while also integrating climate change considerations into pension policies.
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Assessment & feedback
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