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Employment (Older People)
8. Syd Rapson (Portsmouth, North): If he will make a statement on progress in encouraging the employment of people above pensionable age. [132608]
The Minister for Work (Mr. Desmond Browne): Our XAge Positive" campaign is encouraging employers to adopt non-ageist employment practices. Studies show that there has been a marked reduction in the number of companies using age in recruitment. Currently around 930,000 pensioners work. That represents an increase in the employment rate of pensioners from 7.8 to 8.5 per cent. since 1997. Furthermore, we are committed to extending opportunities for older workers and to introducing age discrimination legislation. We are promoting employment among those aged 50 and over and helping people over pensionable age to remain in work if they wish to do so.
Syd Rapson : I thank the Minister for his reply. I cannot understand anyone wanting to work after pensionable age and I shall not be joining them. On behalf of my constituents who have an interest, however, may I ask the Government to take seriously the proposals agreed at the Labour party conference that those in occupational pensions should be able to draw their lump sum, carry on working and draw their pension when eventually they voluntarily retire, without encountering any disbenefit?
Mr. Browne: The implication of my hon. Friend's question is correct. If people choose to take the state pension later while they work on, they deserve a better deal. My right hon. Friend the Secretary of State made the direction of the Government's policy clear at the conference. In addition to enhancing the situation in relation to deferment by increasing the percentage points by 7.5 to 10.4, we propose to offer people the choice for the first time ever of a taxable lump sum if they defer their pension.
Mr. James Gray (North Wiltshire): If the Government are so committed to ending ageism in the workplace, why is there a compulsory retirement age of 60 in the Foreign and Commonwealth Office?
Mr. Browne: The hon. Gentleman probably knows fine well that it is Government policy across the civil service to move from a pension age of 60 to 65. That is a matter for consultation. Once those consultations have concluded, it will be clear how that will apply across each Department.
Mr. Roger Berry (Kingswood): Would it not be helpful for Government Departments to set an example?
Why, for example, should the Ministry of Defence tell one of my constituents who worked as a health and safety adviser that he must retire at the age of 60 not because he could no longer do the job—indeed, he was first employed 12 months ago—but because he had reached the age of compulsory retirement?
Mr. Browne: My hon. Friend highlights why it is so important for the Government to change the policy not only in their Departments but across the country. I cannot, of course, comment on individual cases, but we all know that older workers, whether they be in the Ministry of Defence or elsewhere, have a wealth of skills and experience that can benefit businesses, public services and the economy as a whole. We want employers not only to allow people to work, but actively to recruit workers of that age range.
Private Pension Schemes
9. Chris Grayling (Epsom and Ewell): To ask the Secretary of State for Work and Pensions if he will make a statement on the Government's policy on private pension schemes. [132609]
The Minister for Pensions (Malcolm Wicks): Our document XAction on Occupational Pensions", published in June, sets out a balanced package of measures seeking to ease financial and administrative burdens on employers while ensuring protection for scheme members. By increasing protection, promoting confidence, simplifying the system and enabling people to make informed choices, people will be able to use private pension savings alongside their state support to build up the level of retirement income that they need and expect.
Chris Grayling : I think the Minister's reply is rather thin. The Government appear to believe that the solution to the pensions crisis is either to make people work longer or to use means-testing as a way of rationing the cost. Does the Minister not think it would be smarter just to encourage people to save more for their retirement?
Malcolm Wicks: My brief answer covered much substance in policy, which I recommend the hon. Gentleman studies at some stage. As we have already said this afternoon, pension credit encourages savings. The hon. Gentleman says that our proposals are thin, but they include the introduction for the first time in Great Britain of a pension protection fund to protect pensions when companies go bankrupt. That is not thin—that is a major advance towards social justice.
Kevin Brennan (Cardiff, West): On that point, was my hon. Friend surprised by the comments made last week by the Confederation of British Industry about the Government's proposal of a pension protection fund? The CBI made some critical remarks, which have subsequently been criticised by the Iron and Steel Trades Confederation. Is it not likely that in the past some of the CBI's members got away with not losing their pensions by taking a runner before their company went bust, as usual leaving the workers—such as those at Allied Steel and Wire in Cardiff and Sheerness, and at
Dexion in Hemel Hempstead, and for all I know workers in Kettering as well—without their pensions? As well as legislating for the pension protection fund, as he has promised to do, will he do something to compensate those workers?
Malcolm Wicks: Workers who are already in severe difficulty, such as the Dexion workers whom I met only the other day, are examples of the tragedy of companies going bust leaving people who have been saving for 30 or 40 years bereft of any hope of substantial benefits. My right hon. Friend the Secretary of State has said that we will look at any sensible proposals in relation to that group, but it is difficult to legislate retrospectively. I am pleased that, in future, the pension protection fund will put an end to such scandals.
Mr. Steve Webb (Northavon): To pursue that issue, the Government will be well aware that compensation schemes are quite common. All such matters could be regarded as retrospective, but compensation is not an unfamiliar concept to Government. Why cannot the workers who have lost catastrophically and who are absolutely innocent receive compensation? Will the Minister tell us what he thinks is the principal stumbling block to introducing such a scheme? Will he accept my offer to work with the Secretary of State and himself and their officials, on a cross-party basis, to draw up proposals to deal with the problem that could be included in the pensions Bill?
Malcolm Wicks: Despite the discussions proper in the House of Commons, I hope that we can get cross-party support for the new pension protection fund. I am afraid that I can only repeat that we are examining sensible suggestions. It would be wrong of anyone in this House to raise false hopes in respect of a complex situation.
Mr. Nigel Waterson (Eastbourne): May I remind the Minister that he has had cross-party support, at least from the Conservatives, for the past year or so in tackling the grotesque injustice affecting long-serving workers whose pension funds become insolvent? Why has he still not taken action to change the rules on winding up pension funds that become insolvent? Will he promise today to announce his detailed plans very soon—perhaps at the pensions summit on 4 November?
Malcolm Wicks: Those details will be with the House very shortly. If the hon. Gentleman is offering cross-party support in this important and complex area, I very much welcome it.
Housing Benefit
10. Mr. Tom Harris (Glasgow, Cathcart): What progress he has made with his plans to reform housing benefit. [132610]
The Parliamentary Under-Secretary of State for Work and Pensions (Mr. Chris Pond): Our priorities for reforming housing benefit are to improve administration, promote choice and responsibility, enhance work incentives and reduce levels of fraud and error in the system. We have already made considerable progress. In particular, our major structural reform—
the local housing allowance—will begin in the first pathfinder authority next month. That is the single most radical reform to housing benefit since its introduction in 1988.
Mr. Harris : Does my hon. Friend agree that, although withdrawal of housing benefit from antisocial neighbours should be used only as a last resort, where it is used it might prove to be an effective sanction? If the Government choose not to use such a measure, is there not a danger that they will be accused of, in effect, subsidising antisocial behaviour by tenants whose rent, after all, is being paid by the Government?
Mr. Pond: My hon. Friend and the House will be aware that we have consulted on proposals to introduce powers for local authorities to apply housing benefit sanctions to those engaged in antisocial behaviour. The consultation ended in August and we are considering the responses. My hon. Friend will not be surprised that many organisations were not overenthusiastic about the idea, but I am sure that his constituents, like mine, believe that the right to housing benefit should be balanced by the responsibility to ensure that individuals receiving it do not make their neighbour's lives a misery through loutish antisocial behaviour.
Sir Sydney Chapman (Chipping Barnet): Whatever the need to change and reform the housing benefit system, are the Government having any more success in tackling the many abuses in housing benefit fraud? The Minister may know that I have been asking questions of the Government for the past two or three years. Can he report any significant progress in dealing with this costly fraud?
Mr. Pond: The hon. Gentleman will know that for the first time ever we have an explicit target for dealing with fraud and error in housing benefit. We are making that a priority, and are putting the necessary resources in to ensure that we deal with fraud and error. We are rightly putting a lot of resources into the housing benefit system, but we want to make sure that those resources go to the people who need and deserve that help, not to the cheats and fraudsters in the system.
Mr. Derek Wyatt (Sittingbourne and Sheppey): Does the Minister have any good news for my constituents, as payment of housing benefit by Swale borough council is now seven months behind? My poorest constituents have taken out overdrafts, which have been called in. They have then foolishly taken out loans on credit cards, but those credit card facilities have been called in. It is desperate. What good news does the Minister have about housing benefit in my constituency?
Mr. Pond: My hon. Friend is right to highlight the impact that failure to administer housing benefit effectively can have on both his constituents and all of our constituents, which is why we want to work with local authorities to ensure that we improve performance. Again, we have established firm targets for the performance levels that we expect, and we are investing #200 million over three years to improve local authorities' performance. However, if they do not respond to that assistance and if we are unable to
achieve an improvement in performance in other ways, my right hon. Friend the Secretary of State has the ability to direct local authorities to take appropriate action. In certain cases, we must consider whether constituents' interests desperately need such intervention.
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