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Occupational Pensions

26. Richard Ottaway: To ask the Secretary of State for Work and Pensions if he will make a statement on changes in the level of provision of occupational pension schemes, with special reference to the guarantee of a pension based on final earnings. [36352]

Mr. McCartney: There has been a long-term decline since the 1960s in both the coverage and number of occupational schemes. Provision peaked in the 1960s. There is also a trend away from final salary schemes towards defined contribution arrangements, although by far the majority of scheme members remain in salary-related schemes. We welcome the fact that many employers voluntarily continue to provide pensions for their staff, whether it is through defined benefit provision or defined contribution provision.

The reasons for the long-term changes to occupational pension provision are complex. People are living longer. There has been a relative decline in the sectors that traditionally offer occupational pensions and an increase in self-employment. Lower expected stock market returns, ending of contribution holidays, and an increase in complexity of regulations imposed since the late 1980s have all contributed.

But the Government are acting. We are seeking better regulation through the simplification review; better products through the introduction of stakeholder pensions (with 637,000 individual sales within their first eight months) and the Sandler Review of personal investment products; and to reward saving through the Pension Credit.

Employment Assistance (Deprived Areas)

27. Jeff Ennis: To ask the Secretary of State for Work and Pensions what help he plans to give to long-term unemployed people in deprived areas. [36353]

Mr. Nicholas Brown: Our welfare to work initiatives are helping people into work in all parts of the country. The new deals have already helped well over 600,000 people into jobs.

We introduced Employment Zones specifically to help long-term unemployed people in deprived areas get and keep work. The 15 Employment Zones have already helped over 17,200 people move into work. We are in the process of extending the existing zones' contracts until March 2004, and are currently fully evaluating zone performance before deciding how to take the initiative further. The Doncaster Employment Zone, which is

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operating in part of the Barnsley, East and Mexborough constituency, has already helped over 590 people into work.

Action Teams for Jobs are also helping to tackle joblessness in the most employment deprived areas in the country. In their first year of operation they had helped nearly 16,500 people into work. Up to October 2001, Barnsley, Rotherham and Sheffield were covered by a single South Yorkshire Action Team, which helped 585 people move into work. In October 2001, following the extension of the Action Teams initiative, the South Yorkshire Team was split into two, with one Team covering Barnsley and Rotherham. Between October 2001 and January 2002, the Barnsley and Rotherham Action Team helped 63 people into jobs.

31. Shona McIsaac: To ask the Secretary of State for Work and Pensions what plans he has to help people back into work in areas of acute social deprivation. [36357]

Mr. Nicholas Brown: Our welfare to work initiatives are helping people into work in all parts of the country. However, we recognise that there are a small number of areas with acute labour market disadvantages.

In October 2000, we launched Action Teams for Jobs to help jobless people in the most employment deprived areas in the country into work. Action Teams give help tailored to the needs of the individual clients, developing innovative ways to help people overcome the barriers they face when looking for work. By the end of their first year of operation, Action Teams had helped nearly 16,500 people into jobs. In January we increased the number of Action Teams from 53 to 63, and are investing £122 million to fund the teams up to March 2004.

In spring 2000, we introduced 15 Employment Zones in areas of persistently high long-term unemployment. The zones have already helped over 17,200 people move into work. We are in the process of extending the existing contracts until March 2004. We are currently fully evaluating the performance of the zones before deciding how to take the initiative further.


28. Mr. Clifton-Brown: To ask the Secretary of State for Work and Pensions what plans he has to reform the annuity rule for pensioners. [36354]

Mr. McCartney: The Government issued a consultation document, "Modernising Annuities", on 5 February to stimulate discussion on annuity issues. The consultation will run until 5 April, and we will then consider the responses before deciding how to proceed.

As the Government have repeatedly made clear, it is important that pension funds built up with the support of tax relief are used for their intended purpose—that is, to provide pensioners with a secure income in retirement. Our intention is to ensure that people make well-informed and appropriate decisions when purchasing annuities, and that the annuity market is flexible and offers good value choices within that market.

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Textile Workers (Sunderland)

30. Mr. Mullin: To ask the Secretary of State for Work and Pensions what steps he is taking to assist with retraining redundant textile workers in Sunderland; and if he will make a statement. [36356]

Mr. Nicholas Brown: Wherever redundancies occur, and in whatever sector, the Employment Service together with other key regional partners, will set up a task force to identify and provide the support needed by those affected. This can include help through the Rapid Response Service where appropriate.

The aim of the Rapid Response Service is to provide support for those affected by redundancy and help people make the transition into sustainable new jobs. The nature of the help provided by the service will be tailored to the needs of the individuals, the employer, and the local labour market concerned. This could include offering information and advice to those affected, facilitating retraining where necessary, or developing customised retraining programmes.

We have been developing the Rapid Response Service in pilot areas since September 2000, and across all regions, including the north-east, since April 2001. All the elements of the Service will be in place next month, supported by a further investment of £6 million over two years.

Pensions (Low-paid Workers)

32. Brian White: To ask the Secretary of State for Work and Pensions what support his Department gives to low-paid workers to build up pension entitlement. [36358]

Mr. McCartney: From 6 April, some 18 million employees will start to build up better state pensions when State Second Pension reforms SERPS. In particular people earning £10,800 or less will get at least twice as much as they would have done under SERPS, and anybody earning up to £24,600 a year will also benefit, whether or not they are contributing to a private pension. In addition, State Second Pension will allow some two million carers and a similar number of people with long term disabilities to build up an additional (2nd tier) state pension for the first time.

The minimum income guarantee already boosts the retirement income of nearly two million pensioners. We also estimate that around half of all pensioner households will be eligible for the Pension Credit when it is introduced in October 2003—on average pensioners will be better off by £400 a year with some getting up to £1,000.

Income-related Benefits

33. Dr. Julian Lewis: To ask the Secretary of State for Work and Pensions if he will make a statement on the take-up of income-related benefits by pensioners. [36359]

Mr. McCartney: This Government want all pensioners to have a decent income in retirement and is committed to ensuring that those poorer pensioners who are eligible for the receipt of Minimum Income guarantee (MIG) can achieve their legal entitlement.

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As a result of the national MIG take-up campaign launched in May 2000 there have been an additional 243,793 claims of which 127,371 have been successful providing these pensioners with an extra £20 a week on average. In total, over 1.7 million pensioners are now receiving the MIG, 3500 of whom live in the New Forest, East constituency.

We have produced a new leaflet that explains who is entitled to MIG and how to claim, launched the new 10-page claim form, and set up the MIG Tele-Centre. All of these measures make it easier for pensioners to understand their entitlement and make a claim.

We are following this up, and from October 2001 when a customer applies for their retirement pension those who are not already receiving MIG are asked a series of questions to identify if they may be entitled and encouraged to claim if they wish to do so.

We are looking at a number of options to extend this service so that a claim to MIG will be invited automatically following certain key life events, for example when a pensioner reaches age 75 or 80 or when another benefit such as attendance allowance is awarded.

We are also working in partnership with organisations for older people to improve access to benefits and take up of MIG.

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