Jenny Willott MP writes: 18 months and over a Billion pounds – Lib Dem victory on Women’s State Pension Age

The UK is getting older. In 1970 a person reaching 60 could expect to live a further 18 years. Last year, this had become 28 years. Advances in healthcare, living standards and technology mean that people are living longer and life expectancy is rapidly increasing.

That is why the Government took the decision to bring forward planned increases in the State Pension Age. As I’ve said on Lib Dem Voice before, it is absolutely right for the Government to do this. It’s not a nice decision but doing nothing would risk plunging future pensioners into poverty with less and less help from the state.

However, when the new timetable for this increase was published in the Pensions Bill, it became clear that the Bill could have a devastating impact on hundreds of thousands of women who would be asked to work for up to two years extra before they could claim their pension. And this would happen at short notice, not leaving enough time to adjust retirement plans.

I, and many of my Liberal Democrat colleagues, have been very concerned about the effect of the plans and since the Bill was published, have been fighting to protect those worst affected by the change.

Finally, thanks to this pressure, the Government are going to act. Today they have announced that no women will see their State Pension Age rise by more than 18 months. This is a significant change, costing £1.1 billion pounds and it is down to the great work of Steve Webb, the Liberal Democrat Pensions Minister, as well as many other Lib Dem ministers and backbenchers.

This change will not only help quarter of a million women, but also quarter of a million men who will see their planned increase reduced: half a million people who will be better off thanks to the Lib Dems.

Of course, this is not a perfect solution. Lib Dems would ultimately have liked to have gone further – limiting increases to just a year. However, sadly we are but one part of the Coalition and the vast majority of backbench Conservative MPs have remained silent on this issue, not wishing to put their head above the parapet and risk upsetting Number 10.

Labour on the other hand have offered nothing constructive, calling for the speeding up of the timetable to be scrapped completely at a cost of £10 billion: money which, because of their actions in office, we simply do not have. We must protect people’s pensions but we should be clear that the State Pension would be worth much less if prices rise sharply due to a collapse in the economy.

So we as Liberal Democrats must be proud of the change we have forced on this issue. As members of the Government we have the power to make, shape and influence decisions; to lobby Ministers and stand up for constituents in a way which would simply not be possible if we were outside Government watching the Tories and Labour battle it out.

Yes, a Liberal Democrat-only Government would have gone further, but for the quarter of a million women we have protected, there remain 1.1 billion reasons why Lib Dems in Government matter.

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12 Comments

  • Liberal Neil 13th Oct '11 - 1:08pm

    Well done!

  • paul barker 13th Oct '11 - 7:38pm

    This is a reasonable compromise & our Team in Government deserve our thanks.
    In 2015 we should be arguing for a permanent solution, legislation that would automatically raise The Pension Age by one year every four years. Otherwise every New Administration will have to waste Time & Political Energy going through it all again.

  • Stuart Mitchell 13th Oct '11 - 7:58pm

    Not the best week for the government to be crowing about how woman-friendly it is.

    Of the 180,000 jobs lost between June and August, 175,000 of them were part-time. Since women are four times more likely than men to be part-time, it is clear that women are bearing the brunt of the government’s public sector reduction programme.

    Looking on the bright side, at least those women get to retire much earlier than 65.

    Talk of “rising life expectancy” of course masks the fact that this rise is very dependent on which social class you happen to be in. Those in lower groups will have a very short retirement to look forward to after the age of 68 – not only that, but they will be the people least able to afford to retire early, and in many cases will be physically clapped out long before 68 anyway.

    Add to that the madness of forcing old people to cling on to jobs they may not want while a million young people are out of work, and all of a sudden the increase in retirement age doesn’t seem anything like the logical step we’re all being conned into accepting.

  • Actually Stuart, life expectancies have been increasing for all socio-economic groups. Of course there are still massive inequalities, but this is something which should be addressed through public health and other areas not the pension age.

    And as for the point about older workers clinging onto jobs means young people get them, this is simply not how a labour market works. Google “lump of labour fallacy” and have a read.

    As for Jon’s point about women actually waiting six years, the majority of this increase is due to a 1995 law which equalised pension ages but over a 25 year time period which, thanks to rapidly increasing life expectancies and a falling birth rate, is unaffordable. So this Bill in an added increase. I think we can certainly celebrate shaving some time off (especially given how hard it must be to get £1bn off George Osborne) even if it’s not what we’d like in an ideal world.

  • Bill le Breton 14th Oct '11 - 9:32am

    In 2004, a woman born in 1954 would have expected to be able to start receiving her state pension in 2014, ten years on from that date. A few years later, that age was lifted to 62, shortly after that to 66.
    Had they been born a couple of years earlier they would now already be of pensionable age.
    Can anyone deny that these individuals (Jenny can tell us how many there are) have received a particularly rough deal. I am tempted to say that if this treatment had been doled out to a group of men it would have been met with a storm of protest and soon reversed.
    If I understand yesterday’s announcement correctly, these women have had their pensionable age reduced by six months. In seven years they have seen their prospective pensionable age rise by five and a half years. Where is the fairness in that?
    Because they lived much of their lives in times of extreme sexual discrimination many will have done menial jobs either and often both at work and in the home. So, a high proportion who would otherwise have been able to ‘retire’ with dignity at a reasonable age will now find themselves either on incapacity or (as Stuart warns)unemployment benefit.
    So, it’s two cheers (as Jon seems to be cautioning) for yesterday’s announcement, but I hope those women continue their campaign. And I hope Jenny continues to campaign for them. For all the hype, 6 months is not much of a transitional cushion for this very particular group.

  • Jenny has done such a wonderful job on this. Her speech in the pensions’ debate was a masterclass in loyalty where Steve Webb had got it right but steely strength on an issue where the coalition had got it wrong.

  • @ Bolivia Newton-john

    These are not baby boomers, they have already retired.

    I thought this had been done because of Cameron, not the Lib Dems or so I have read. It has not helped me, I still have to wait over a year extra. Do not worry about the cost of pensions, many will die of stress and poverty related illnesses before they qualify unless of course you are an MP like Jenny Willott. Tell me, have MPs pensions been looked at? No I did not think so.

  • Stuart Mitchell 14th Oct '11 - 8:18pm

    James: Life expectancy may have gone up for all social groups but it’s gone up far more for rich people than it has for the poor – the gap has widened dramatically. The situation is even worse when you look at *healthy* life expectancy; in some parts of the country, among some social groups, this is already significantly lower than the current retirement age. Raise it to 68 (and beyond) and many people will have no realistic expectation of even five minutes of healthy retirement.

    This ought to concern anybody who clings to old-fashioned notions of fairness, and it is entirely appropriate that we should consider it when making decisions about the retirement age.

    There’s a simple one-word retort to those who claim that our current pension age is unaffordable: “France.” Demographically the French are very close to us – similar birth rate, similar percentage of people aged over 65, similar life expectancy (in fact they live a year or so longer than us). They also have a very similar GDP per capita to us. So if they can afford a retirement age of 62 (itself a much-despised increase from the current 60) then don’t believe anybody who tells you we can’t afford to stick with 65. We could – if we wanted to.

  • Bill is wrong and James is right. I am one of the women affected and I have known since I was in my mid 30’s that my pension age would be above 60. I was expecting my pension at 64 and some months and then the new Pensions Bill increased that to 66 – overnight – with eight years notice. I challenged Danny Alexander at the Scottish Conference in the Spring about whether the Government would look at women like me again – and got a short one word answer – No.
    So I am pleased that they HAVE actually reconsidered – and I squeek into the change by some three weeks. I am however still trying to find any information on a Governement website telling me exactly when I get my state pension. Thre was previously a useful table setting out exactly when everyone got their pension depending on their date of birth – I assume it will be updated at some point.
    Obviously I feel a bit sore that many of my women friends just a few years older than me already have their pensions and that I am having to wait considerably longer than them, but I do believe that it is essential to increase the pension age because we are all living longer – and I agree with the comment about reducing inequalities. I did hear a snippet on the radio suggesting that the Government might be considering a formula to increase the pension age automatically as life expectancy increases and that seemed worth considering.

  • Jennifer – the change only becomes law if MPs vote for it tomorrow (which they are expected to do). That is why you can’t find anything official telling you your new pension age, because it is – strictly speaking – unchanged until the law is passed.

    Stuart – I absolutely agree that differential life expectancies is a major cause for concern for any of us interested in equality. However, the pension age is not the right lever to pull because it is an incredibly blunt tool. Hence focus should be on public health and other ways of reducing social and economic inequalities.

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