State Pension Credit Bill [Lords]

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Mr. Webb: Thank you, Mr. Atkinson. The Bill goes some way to deal with a problem that has been greatly exacerbated in recent years, but it does not go the whole way because people, instead of being clearly means-tested and receiving the full benefit are, at the best, receiving 60 per cent. of the benefit of their savings.

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5.15 pm

Maria Eagle: I am not trying to make partisan points, but they are technically correct. The gap that the hon. Gentleman describes is basically due to the fact that the previous Conservative Government decoupled the basic state pension from earnings upratings. Consequently, there was much recipient poverty and it was becoming worse. The means test, the minimum income guarantee, income support—members of the Committee can call it what they will—is there to tackle that problem, hence the gap. Is it not still the hon. Gentleman's party's policy to increase the basic state pension in line with prices? That will not deal with the problem. We are dealing with it.

Mr. Webb: Obviously, my party's policy is not related directly to the amendment. I shall happily lend the hon. Lady a copy of the Liberal Democrats' manifesto, which pledged state pension rises of £5 for those aged 65 to 74, £10 for those aged 75 to 79 and £15 for those aged over 80, and those sums are vastly in excess even of the earnings uprating of a whole Parliament. In other words, by substantially raising the state pension, people would be clear of the means test and their savings will count.

Amendment No. 19 asked for statistics on those entitled to the

    ''guaranteed credit alone;

    (ii) the guarantee credit and the savings credit; and

    (iii) the savings credit alone''.

The Minister has often said that two thirds or three quarters of the gainers under the Bill will be women. Can we be given a breakdown of the guarantee credit and the savings credit by gender? Clearly, the minimum income guarantee is predominantly about women. It concerns poor pensioners and they are mainly women. Most of the money will go to women. When the Government say that two thirds or three quarters of the gainers will be women, I am not clear whether that is driven by the MIG and whether rewarding people with small savings is about women or men, or both equally. I do not know that information and the report proposed under the amendment No. 19 would help.

I hope that the Minister can give us in writing not only the overall figure of women gainers, but the proportion of the minimum income guarantee and the savings credit gainers who are women. I am grateful to have had the chance to pursue such important issues. As the Committee will have gathered, my key point is that take up is essential. At present, the position is unsatisfactory. The figures are out of date. They are derided by the Government. We need good, reliable evidence and the amendment would give it to us.

Mr. Boswell: The Committee has already been treated to two serious presentations by my hon. Friend the Member for Hertsmere and the hon. Member for Northavon, and to some lively exchanges. I seek neither to prolong nor provoke those, but merely to make a couple of points. The purpose of the amendments is to invite the Government to commit themselves to an exercise in truth when presenting the effects of the policy. Clearly, Labour Members believe that the initiative will be successful and that it will

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generate huge benefits for pensioners. We have accepted that it will generate benefit to some pensioners, so we shall not rehearse that argument. However, on the assumption that it will benefit a lot of pensioners and they will take it up, the figures will show that to be so.

My hon. Friend the Member for Canterbury (Mr. Brazier) will remember the story—as would a Biblical scholar—of Gamaliel, who said that if an enterprise is from heaven, it will be successful, and if it is not, we need not bother. That is the essence of what we are saying. Let us get the information out so that we know the figures. In deference to the hon. Member for Northavon, who is the social scientist among us and has a proper interest in the matter, as do we all, let us see whether we are getting value for money and whether the thing is working. That is the substance of the amendment.

It is fair to say that the other amendment is more speculative because of the complexity of working out people's behaviour on their pension provisions from the age of 15 onwards. However, we must know what happens about payments against entitlements—take-up—and whether the system has the success that Ministers anticipate. I do not think that that is unreasonable.

I pick up two points to share with the Committee. Some members of the Committee may have read a study of ancient languages and their texts—I recommend it to hon. Members who have not read it—which may be of value when understanding the pension credit. However, if hon. Members are really students of higher criticism, they will notice a slight difference of style in the text of amendment No. 19. The earlier part is more elegant because it was drafted by my hon. Friend the Member for Hertsmere, and the latter part is rough and ready because I drafted it. Broadly speaking, paragraphs (a) to (d) are in my hon. Friend's hand, and paragraphs (e) and (f) are in mine. I shall speak to those further.

Paragraph (f) states that the report should include

    ''representations made to the Secretary of State by the Social Security Advisory Committee or by such organisations as may seem to him representative of the interests of pensioners in connection with the operation of state pension credit.''

We are asking for what the social scientist would call a feedback system, whether on initiative or because of a request by the Secretary of State. That would allow the outside bodies that gave evidence to the Work and Pensions Committee and made submissions to members of this Committee to continue to monitor the situation.

That process would be iterative. If the Government publish a report one year with figures on entitlement and take-up, bodies such as Help the Aged and Age Concern could come back the next year and say, ''This isn't working very well. Our analysis suggests that this is the area that isn't as good as it should be.'' There could be dialogue and what car manufacturers call a policy of continuous improvement. The hon. Member for Basildon (Angela Smith) will remember that phrase because it used to be the policy of the Ford Motor Company—we both have plants with Ford involvement in our constituencies.

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We accept that the situation is not perfect now, and I hope that the Ministers accept that. It is imperfect in several respects. However, even if it were perfect, we could improve it to an extent. Therefore, it is important that continuing dialogue exists. That is a matter of accountability, and forms an important part of the wider issue of the Government's shift to a credit-based philosophy. There is a suggestion that although benefits flow through the Social Security Advisory Committee in what may be termed loosely a time-honoured way, accountability and feedback would be less developed as we move to a credit regime. We want those to be taken forward.

Paragraph (e) mentions

    ''details of the steps taken to encourage those entitled to state pension credit to make a claim for it, and of the steps to advise those making such claims''.

That is the essence of whether the Government's wish to improve take-up will succeed and whether the delivery of the benefit through the Pension Service will be a success. If one wanted to give a short title to the paragraph, it would be ''Let's have a talk about the Pension Service''. The Ministers know that I have expressed worries about that in the past.

If it gets about in the Committee that we are trying to subvert the success of the policy, that is an absurdly overblown attribution of our power. We have no interest in doing that. We shall play it straight and try to tell people how the system works and, above all, not rubbish the work of the Pension Service or its officials. The Minister is blessed with some excellent officials who will want the Bill to work.

I mentioned the fact that the manager of my local Pension Service centre in Leicester has been proactive and has written to me to ask whether I would like to discuss the matter. I welcome that and will respond, and I hope that other Members will do so, too.

Our older constituents have an interest in receiving a proper service. That needs saying, and I am sure that everyone will do their best, including Ministers. However, both the evidence given to and the report of the Work and Pensions Committee show some major areas of concern. I do not want to widen the debate unduly, but the concerns flagged up in the report at least suggest that as part of the process of annual accountability there should be some reporting and feedback on that aspect, too.

The relevant sections of the Select Committee report show concern about the concept of call centres, with which many of us are reasonably familiar and comfortable. Just this afternoon I had to ring a service company about having my windscreen repaired, as a stone hit it. I went through the multiple choice, had to press 1 or 2 and hang on and was told to wait two minutes, very courteously—it is a high level of service, up to a point—and did not end up slamming down the telephone in despair. It went perfectly well, but it was a 10-minute, slightly stressful process, and could be broken at any stage. I am a little younger than a pensioner and my generation was taught to argue, make its case and fill out forms. It is not as easy for every customer of the Pension Service. The dynamics of relying on a call centre, especially if

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there is no local access or adequate domiciliary visits, are important.

A subset of concern expressed in the Work and Pensions Committee's report relates to the natural first language of people from ethnic minorities. Until I read the report, I was not aware of the remarkable fact that there will be no call centres in the south-east. Its Pension Service will be located in Blackpool or thereabouts. Not many people in Blackpool are natural first speakers of ethnic minority languages and so able to match the 300 languages spoken in London. I am sure that the problem can be overcome and am merely telling Ministers that it is essential that it should be.

Ministers will be aware of past analogies and that considerable concern has been expressed about the robustness and reliability of the Department's computer systems. If any of them go wrong, there will be difficulty. My biggest worry, which I do not signal—I do not want it to happen—is that if the credit gets off on a bad foot, people will be discouraged from using the system and even applying for it. Take-up and other figures will tend to move down further.

Ministers are upbeat and optimistic about how the credit will work. I hope for their sakes and that of pensioners that it does. However, to counterbalance that, I quote Tony Lynes of the National Pensioners Convention, who, as is mentioned in the report, said bluntly:

    ''No Government has ever before tried to means test over 5 million pensioners. The chances of that going smoothly seem to be extremely remote.''

That is his conclusion, not mine, and I hope that he is unduly pessimistic. However, the potential for difficulty exists. The policies may not work in policy terms, and they may not be delivered in terms of the service's arrival or availability to those who need to use it. We all want it to work properly. No one who serves on this Committee has no commitment to the cause of pensioners. They constitute a huge interest in this country in terms of numbers, and many of our constituents. Many of them are still under some strain and pressure of income. That is not a matter that we need to debate; we need to ensure that they are looked after properly.

The series of changes to the system were, no doubt, conceived with the best possible motives and from a wish to get the system right; I am not arguing that Ministers do not want it to work. We now have the boring business of seeing that at work. If we are to find out whether it works and whether it has the social consequences that Ministers want, we need data and a system under which there can be feedback and discussion, and under which improvements can be made. That, and no more, is what we are trying to do through the amendment.

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