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Mr. Boswell: We do not need to get into a silly semantic argument about it. I was merely implying, first, that some Ministers' claims that the measure helps all women went somewhat beyond what they were entitled to say and, secondly, that in a number of cases, which we sought to identify in explaining the new clause, women will not benefit at all.
Mr. McCartney: I thank the hon. Gentleman for his volte face—I was not expecting a total U-turn. I have never said that every single woman who reaches retirement age will benefit from pension credit. We said from the outset that 5.1 million pensioners will benefit. Of those, 53 per cent. of single women and 31 per cent. of couples will benefit from pension credit, so 84 per cent. of women will experience a positive impact on their retirement income. It is nonsense to suggest that this is not a significant step forward for women—of course it is. It is not only about righting the wrongs of the past, but about being able to put in place for the future a system that is non-discriminatory towards women.
I want to refer to the Sunday Mirror article that quoted the hon. Member for Northavon, which is entitled "The Unfairer Sex: Poverty trap for women pensioners". It is unfortunate that in a debate about the unfairer sex, as the article terms them, the only Members who have participated so far are grizzly middle-aged men. I think that we all agree, on a non-partisan basis, that we are sympathetic to the unfair way in which women have been treated in the past, but it is important to correct some of what was said in the Sunday Mirror article so that people are not misled either about a lack of entitlement to minimum income guarantee or the current level of the basic state pension.
The hon. Member for Northavon may say that he was misquoted or that the article was edited to give average figures. I shall be kind and say that it must be the latter,
because the Sunday Mirror never misquotes anyone of substance. [Interruption.] I heard an hon. Member say, "That leaves the hon. Gentleman out." I was not intending to feed Labour Back Benchers; I shall not give them any red meat just yet. I want to clear this up. The last time the basic state pension was £58 was in 1984. The current basic state pension is £75.50 for single people and £120.70 for couples. More importantly, for the women to whom the hon. Member for Northavon referred the minimum income guarantee is £98.15. For couples it is £149.80. That is a significant improvement on the figures cited in last Sunday's article, and that should be acknowledged by all concerned.I turn to the debate in Standing Committee on 18 April this year. I want to give two short quotes that set the tone for what I am going to say next. The quotes come from columns 121 and 122 of the Official Report. That is not so much a reference for Hansard as for the Gallery writer from The Times, who unfortunately seems not to understand Glaswegian. [Hon. Members: "Shame."] He wrote an article in which he did not spell anything right. He thought that I was asking for a pint of heavy, but I was talking about the pension credit. Just for the record, I shall say that it was the pension credit, not a pint of heavy—although at this moment I would prefer a pint of heavy.
I said in Committee, in response to my hon. Friend the Member for Stalybridge and Hyde (James Purnell):
- "We appreciate the work that foster carers do and sympathise with those who, having chosen to be full-time carers, receive poorer pensions as a result."
- "I do not wish to over-egg the pudding and suggest with nods and winks that a solution is just around the corner; I am telling him openly and honestly that this is another issue that I looked at when I first became a Minister, and I decided that something must be done. We are reviewing the matter. I cannot say any more, but I hope that hon. Members will understand that I recognise the problem and that it must be resolved in an effective way".—[Official Report, Standing Committee A, 18 April 2002; c. 121–122.]
New clause 1 would have the effect of deeming a notional amount of basic retirement pension, so that a group of pensioners—in this case, those caring for children before 1978—could make the most of the savings credit. It would increase the amount of basic state pension they have in the calculation of the savings credit, so that they have to use less of, or none of, their own savings to get their income up to the savings credit threshold of £77. It might help if I give an example. A single pensioner has a reduced basic state pension of, say, £50 because they have a deficient national insurance record. They have a second pension of £25 and no other income. Their total income of £75 would immediately be topped up to the guarantee credit of £100, but they would receive no reward for their saving because their income was below the savings threshold of £77. In other words, they would not receive any savings credit because their income was below the level of the full state pension. If they could take advantage of home responsibility protection, they might qualify for the savings credit.
The new clause as drafted would have two peculiar outcomes. First, it would require people to list any natural children they have ever had, regardless of whether they have ever had any caring responsibilities for them. I am not sure that the Department for Work and Pensions needs that information, nor that people would want to share it with us—nor, in some cases, with their current partners. That matters, because at this stage of parliamentary scrutiny there is no further opportunity to correct drafting.
Mr. Webb: I do not quite understand what the Minister is saying. New clause 1 states that claimants would be
- "asked to list the date of birth of any natural children and any other children for whom they had primary caring responsibilities".
Mr. McCartney: My interpretation of the new clause is based on the advice on its wording that I have received from parliamentary counsel and our officers. It would be a legal minefield to go back for such a long period in relation to natural children who were cared for initially, but later not cared for after those looking after them had given up their caring responsibilities. It is also a potential minefield in terms of relationships with current partners.
Secondly, the new clause would allow a person the option of replacing their actual rate of basic pension with a higher amount in the calculation of the guarantee credit. I am unclear whether this was intentional, but if a person did exercise that option, their income would decrease, not increase. That said, I think that what the new clause tries to achieve is an increase in basic state pension so that more people come nearer to the £77 threshold. It would do that in a notional way by imagining that this group of pensioners was entitled to the home responsibility protection in a time before it was invented. One cannot make law on that basis. One cannot dream up or invent a situation, then develop proposals on that basis which go back, not for two or three years or for one or two decades, but beyond even that.
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Home responsibility protection has been available since 1978. It covers two distinct groups of people. Those in the first group have been awarded child benefit for children under 16; those in the second have been regularly engaged for at least 35 hours a week in caring for someone who receives attendance allowance or the highest middle rates of disability living allowance for a minimum of 48 weeks a year. Entitlement to home responsibility protection depends on people undertaking the caring activities for complete tax years.
The protection offers a reduction in the number of qualifying years for a full basic pension. For example, a woman needs 39 qualifying years of contributions or credits for a full pension. Every year of the protection reduces that number, and there is a maximum number of years that can count towards home responsibility protection: 19 for women and 24 for men. The different periods reflect the current arrangements whereby men need five more qualifying years to earn a full basic state pension.
The new clause tries to provide home responsibility protection as if it existed before 1978 to those who would have been entitled to child benefit if it had existed before then. The new clause would achieve that by asking all new claimants for the pension credit to list the dates of birth of their children if they cared for them before the introduction of home responsibility protection. The hon. Member for Northavon wisely does not try to apply the new clause to carers of the sick and disabled. The provision is confined to parents; he does not propose its extension because he knows that that would be unworkable. Trying to prove a caring relationship that fulfilled the criteria for home responsibility protection would be impossible after so many years. He nods, so I am right about his intentions.
The new clause would be impossible to put into effect. We could be stretching back as far as the 1920s. That is at the heart of the problem, and why in practice and in principle, Governments cannot generally go back that far. We cannot replicate current provisions with ease or certainty. If we try to do that, we create a form of injustice for someone else. For those reasons, we must reject the new clause. However, I do not want hon. Members to be left with the impression that refusal to accept it means a significant gap in provision. It does not.
Those who are disadvantaged because they do not have access to home responsibility protection are likely to be few. Many of them and the larger group of carers who are already covered by the protection will be married women. Most will have the benefit of a full married woman's pension. Any pension in excess of that, private or state, will be rewarded. Many of the women will now be widows. On widowhood, the combination of their national insurance contributions and those of their late husbands will have brought the income of most of them up to the basic state pension.
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