The WASPI debate that will happen tomorrow is of some significance. Not only will parliament be debating the particular circumstances of a particular group of women, they will be deciding whether the duty of care Government has, to keep its citizens properly informed of changes in welfare provision, was properly exercised. Further than this, it is a debate around whether a future Government is responsible for reversing actions taken (or not taken) by previous Governments, on a retrospective basis.
As most people reading this will not be experts in the legislation, here is the background to the debate.
The Pensions Act 1995 provided for the State Pension age (SPA) for women to increase from 60 to 65 over the period April 2010 to 2020.
The Coalition Government legislated in the Pensions Act 2011 to accelerate the latter part of this timetable, so that women’s SPA will now reach 65 in November 2018. The reason was increases in life expectancy since the timetable was last revised. It had initially intended that the equalised SPA would then rise to 66 by April 2020. However, because of concerns expressed about the impact on women born in March 1954 who would see their SPA increase by as much as two years as a result, it decided that this should happen over a longer period, with the SPA reaching 66 in October 2020.
Some women born in the 1950s argue they have been hit particularly hard, with significant changes to their SPA imposed with a lack of appropriate notification. However, the Government has said it will not revisit the 2011 Act timetable.
There was a Westminster Hall debate on the issue on 2 December 2015. In a backbench business debate on 7 January 2016, the House voted in support of a motion tabled by Mhairi Black calling for transitional arrangements for women negatively affected by SPA equalisation. However, such motions are not binding on the Government. 1 February 2016, there will be a debate in Westminster Hall on a petition by Women Against State Pension Inequality
If you want to be familiar with the wider context of the debate -overseas comparitors, the history of communication as well as the key statements made in last twelve months – here is the document you must read. (you need to click the box at the bottom of the page for the PDF)
If you read this Parliamentary Briefing Paper on the State Pension age increases for women born in the 1950s (published 29th Jan), you will see that the decision taken to adjust the timetable of reform in 2011 was a very messy business.
Here is the “mea culpa” made by Steve Webb late last year on
We made a choice, and the implications of what we were doing suddenly, about two or three months later, it became clear that they were very different from what we thought […] And so that’s a decision that we got wrong, and in the end I had to go to Number 10, sit around opposite the Chancellor and the Prime Minister trying to get billions of pounds back. So this was a measure to save 30 billion quid over how many years, and we wanted 10% of that back to soften the blow, and we got £1 billion back in the end, and a billion quid is a serious amount of money. 23
What Webb;s statement says is all that can be said, that Government is imperfect and that from time to time imperfect decisions get taken. The implementation of the new SPA for certain women was badly done and the fix was a bodged job – and that is that
What is done is done- and should not and cannot be undone
You will also read that whatever the Government did to communicate the change was thought proportionate at the time.
The fact is that the £2bn which Webb feels should have been used to soften the blow is now allocated to something else, the money is spent. That something else is presumably sorting out another problem. Restitution -even a relatively small restitution such as the transitional arrangements some are calling for, comes at a price that must be paid by others.
I feel quite strongly that we have a system of Government that- though imperfect – in not institutionally unfair. We need to be Governed and we elect people to Govern us through a proper democratic process. We must abide by the consequences of that process- no matter how imperfect.
And what will be done in future may not be done any better.
You will also read that whatever the Government did to communicate the change was thought proportionate at the time. The distribution of leaflets, the writing of letters, the placing of articles were thought by the DWP to be the proper means of communication of the 1995 and 2011 changes.
There are many changes to come for the state pension- most especially about the state pension age. The Government won’t get all those decisions right either. That’s because the assumptions made on how long people live, what the cost of pension increases will be and what the impact of immigration and emigration will be- cannot be predicted.
Government is imperfect. And what is more communication is imperfect. We may be able to reach a proportion of those in their fifties and sixties by post , but many will not open the letters. We can put Workie like adverts on TV , but many will not watch them. No Government has a foolproof way of telling everyone what is going on.
In the end, we must accept that we- the citizens are responsible for finding out what is going on. This is fundamental to the process and the duty of care we have towards ourselves is greater than the duty of care from the Government.
Under-informed is not the same as being misinformed
No one is saying that what information the Government put out was wrong. Some are saying it was ineffective.
By comparison, much of the information put out by the private sector about personal pensions was clearly wrong, advisers and insurers did not properly explain what would happen on early termination and sometimes they lied.
I hope that this distinction will be made in tomorrow’s parliamentary debate.
No matter how we feel about the job done in 1995 and 2011, we should not consider there a plot to deliberately disadvantage certain people, nor should we conclude that anyone was mis-selling what was going on.
The adjustments may have been a bodged job and the communication under-cooked, these are legitimate observations that may and probably will arise from tomorrow’s debate.
But to assume, as a result of such admissions, that we can roll back the reforms is wrong. We must accept whatever decision is taken by the Government on this – whether we like it or not and move on.
What we can learn
What WASPI is doing is bringing to our attention, the lack of attention we pay to critical decisions being taken on our behalf by those we pay to take them.
The process of consultation about those decisions is part of Open Government and we all have the opportunity to participate and influence debate by arguing from our corner.
The big pension decisions about to be taken on tax, national insurance – on the governance of the private pensions we put our savings into and the way the workplace is used to collect this money- are all open to our influence.
Social media- which allows this blog to be read every day by thousands of people, is part of that process.
We can learn how our retirement can be funded, and how to do the best to make ourselves comfortable. We can learn how taxes can be fairly used to provide fairness across generations and we can learn what we are due and when,
Most importantly, we can learn from WASPI the importance of planning ahead and paying attention to the pension. Which is why I am very grateful to the WASPI women.
I think we have failed in our duty of care and are continuing to do so, but that duty of care is to ourselves, and that is what WASPI can change.