Mr. Jim Cunningham (Coventry, South) (Lab): I congratulate my hon. Friend on securing this debate. We have taken a number of measures over the years against discrimination, but does my hon. Friend agree that the operative word for this pension provision is "discriminatory"? A married couplein this case, a civil servant and his wifemay be married for a long time, and the wife ultimately expects a share of his pension because of the hardship, which takes various forms, that she experiences as a widow. Surely, the measure is discriminatory, especially as only about 10 per cent. of women are entitled to a pension.
Mr. Betts: My hon. Friend makes a very good point indeed. It is a matter of entitlement. The spouse of a civil servant, a police officer or an officer in the armed forces effectively achieves entitlement to a pension when they are widowed. The removal of that entitlement at any stage is a fundamental injustice that goes against the grain of the British sense of fairness.
The regulations say that the pension will be taken away if the individual remarries or cohabits. It is quite simple to prove that someone has remarried. Indeed, because everyone knows that it is possible to discover whether someone has remarried, people will write a letter to officials saying, "Hands up, I know that I will lose my pension, but I wish to inform you that I have remarried." Although they do not like it and disagree with it profoundly, they accept that the pension that they receive as a widow or a widower will come to an end. Does my hon. Friend the Minister believe that that happens in all cases of cohabitation? How do the Government know whether someone is cohabiting? Does the Duchy of Lancaster employ an army of individuals who go round the country late at night or in the early hours of the morning to discover whether the widow or widower of a civil servant, a police officer or an Army officer is cohabiting? Do they go out once or twice in the middle of the night to discover whether they are cohabiting? Unless someone puts up their hand and says that they are cohabiting, there is not the faintest possibility that the Minister or his civil servants will know whether someone is cohabiting and should not claim a pension.
Individuals may do something to alert the authorities dealing with pension payments to the fact that they are cohabiting. For example, a widow and a widower who both receive civil service pensions may start to cohabit and provide the officials administering the pension scheme with the same address. Under those circumstances, the officials might put two and two together and work out that the couple are cohabiting. Alternatively, anonymous phone calls might be made, and officials could respond to them. The reality of the situation, however, is that if a widow or a widower remarries they will lose their pension,
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but if a widow or a widower cohabits they probably will not do soso the Government are effectively discriminating against people who remarry.
I do not believe that the state should give people financial incentives to marry. The Government have been right in saying that it is not their responsibility to interfere in people's relationships and say that people should or should no, marry. If people want to live together outside marriage, that is fine. Equally, the state should not give people incentives to co-habit rather than to marry. However, that effectively is what it is doing. One can prove marriage very easilyto prove that someone is co-habiting is much more difficult.
I do not know what the cost of the proposal to bring back the pension for all those who have lost it in this way would be. I have seen a number of figures. I have heard that a one-off payment of £3 billion would have to be made. I find that a little difficult to get my head around. It must extend beyond civil servants to all public servants in this situation. It must assume that people in these circumstances will be paid the pension that they lost over the years after they remarried or cohabited.
I accept that that would be a substantial sum of money and perhaps another thing that the Civil Service Pensioners Alliance would not press for, but I see many different figures for providing a pension from now on to the people who have lost it, or for in future not taking away the pension of people who remarry or cohabit. The Civil Service Pensioners Alliance has given me the figure of £300 million over 30 years. According to its estimate, that would add 0.4 per cent. to the current pension cost. If a further demand for a pension for post-retirement marriage widows and widowers were acceptedI understand that widows are not entitled to benefits if they retired before 1978 and widowers if they retired before 1988that would add another £75 million over 20 years, or about 0.14 per cent. to the cost. Therefore, about 0.5 per cent. in total could be added for both proposals. It does not seem an awful lot of money.
When I asked questions of the then Minister of State, Cabinet Office, my right hon. Friend the Member for Bolton, West (Ruth Kelly), in October 2004, I was told that in the previous two years only 325 widows or widowers' pensions were suspended due to remarriage or cohabitation, and that to reinstate all the pensions that were suspended over the previous 10 years would cost about £50 million. It does not seem that we are talking about enormous sums of money.
Is there not something fundamentally wrong with a system that says to someone, "If you are going to go into a new relationship, we are going to financially penalise you for that. We are going to make you choose whether to go into that relationship without any income of your own and to rely on your new partner absolutely, or whether to accept that you cannot go into a new relationship because the financial penalty imposed on you is so great that it is not worth while"? Forcing people into that dilemmathe choice between the pension that they were entitled to because of their previous spouse's employment and having a new relationshipis fundamentally wrong. The state is interfering in matters, albeit not by design but by effect, in which it should not be involved. It should not be putting people in the position of having to make that appallingly difficult choice.
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My final point must have crossed the Minister's mind. He must have got copious briefing from his civil servants about it because it is about equal opportunities. As my hon. Friend the Member for Coventry, South (Mr. Cunningham) said, the Government have to address that issue seriously. We have a very good record on equal opportunities across the board on a series of matters.
Mr. Jim Cunningham: My hon. Friend raises an important point, which I touched on earlier. The Government have a very good record on equal opportunities, but a report will be published tomorrow or the day after on equal pay for women. It seems that what he has described affects not only men but women. It could be seen as a sanction. If we think about it, the two things are linked. Nine times out of 10, it will be the woman who will face the sanction and be forced into a situation where, as he said, she does not declare the fact that she is cohabiting. Perhaps she will just decide not to have a relationship. At the end of the day, she made a major contribution through bringing up a family for 30 or 40 years. Does he agree that things have to be looked at in a broader sense?
Mr. Betts: I agree entirely and my hon. Friend makes a very important point. Indeed, today's report deals with the inequality between women's pay and men's pay, and the Government have rightly expressed concern about that issue and spoken of the need to address it. Of course, pay is not something that they can directly influence in every circumstance, but they can directly influence pensions because it is within their remit to do so.
The Government recently dealt with the equal opportunities problems to which the 85-year rule for the local government pension scheme has given rise. In general, women do not serve in local government for quite as long as men because their service is often broken, so they cannot benefit from the 85-year rule to the same extent. The Government have therefore said that because the rule disadvantages women, it is fundamentally unfair and must be removed. However, here we are talking about a rule for civil service widows and widowers that by its very nature discriminates against women, because the fact is that the vast majority of those who lose their pension in this way are women. The Minister doubtless has the precise figures, but we know that to be the case. This rule significantly disadvantages women because more widows lose this pension entitlement than do widowers.
I suspect that if the Government applied to the rule for widows' and widowers' civil service pensionsand elsewhere in the public sectorthe same test that they applied to the 85-year rule for the local government pension scheme, they would objectively conclude that the former rule is equally discriminatory. I urge the Government to re-examine it because it is fundamentally unfair. It is unfair because it removes a right that a person has built up over time by being married to someone who was in a job that, in a sense, the couple shared during their lives together. That entitlement should not be removed. It is unfair because it requires people to choose between keeping their
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financial entitlement and entering into a new relationship. It is unfair because it discriminates between those who remarry and those who cohabit. Ultimately, it is unfair because it discriminates against women in a way that could be subject to challenge in the courts under equal opportunities legislation. It would be much better if the Government accepted responsibility and removed this rule, rather than leaving it to the courts to do so.